Justia U.S. 10th Circuit Court of Appeals Opinion Summaries

Les and Gretchen Howell invested in a silver-trading scheme called the Silver Pool, operated by Gaylen Rust through Rust Rare Coin. Les invested about $1.2 million and received $3.2 million in profits, while Gretchen invested $96,450 but lost $74,450. Les used his profits to buy land and build a house in Kingman, Arizona, and made Gretchen a joint tenant. The Silver Pool was later exposed as a Ponzi scheme, and the Commodity Futures Trading Commission (CFTC) brought an enforcement action against Rust. Jonathan O. Hafen was appointed as the receiver to recover assets fraudulently transferred through the scheme.The United States District Court for the District of Utah granted Hafen summary judgment against Les and Gretchen on fraudulent-transfer claims under Utah’s Uniform Voidable Transactions Act (UVTA), ordering them to return Les’s $3.2 million profit. The court also awarded Hafen prejudgment interest at a 5% rate. The Howells sought reconsideration and clarification of the judgment, particularly regarding Gretchen’s liability. The district court clarified that Gretchen was liable for $1.5 million, representing half of the $3 million Les invested in the Kingman property.The United States Court of Appeals for the Tenth Circuit reviewed the case. The court affirmed the district court’s application of the Ponzi presumption under the UVTA and the reliance on expert reports. However, it found that the district court erred in calculating the judgment against Gretchen. The appellate court held that the judgment should reflect the value of Gretchen’s interest in the Kingman property at the time of transfer, not the amount Les invested. The case was reversed and remanded for further proceedings to determine the correct amount of the judgment against Gretchen. The court otherwise affirmed the district court’s rulings. View "Hafen v. Howell" on Justia Law

The case involves a challenge to Kansas's restrictions on private parties partially filling out mail-ballot applications before sending them to registered voters. Plaintiffs, VoteAmerica and Voter Participation Center (VPC), argue that these restrictions violate their First Amendment rights to freedom of speech and association. They seek an injunction to prevent Kansas officials from enforcing the law.The United States District Court for the District of Kansas ruled in favor of the plaintiffs after a bench trial based on stipulated facts. The court applied strict scrutiny to the law, finding that it violated the plaintiffs' First Amendment rights. The court held that the mailing of prefilled applications was protected speech and that the law was not narrowly tailored to serve a compelling state interest. The court also found that the law infringed on the plaintiffs' associational rights and declared the law unconstitutionally overbroad.The United States Court of Appeals for the Tenth Circuit reviewed the case. The court first determined that the prefilled applications should be considered separately from the cover letter included in the mailings. It then concluded that mailing the prefilled applications constitutes speech protected by the First Amendment. However, the court rejected the application of strict scrutiny under the Meyer-Buckley framework, finding that the law did not restrict access to a fundamental avenue of political discourse. The court also rejected the argument that the law was subject to strict scrutiny due to speaker discrimination, as the law's speaker-based exception did not reflect a content preference.The Tenth Circuit held that the proper level of scrutiny for the law is intermediate scrutiny, as the law is a content-based but viewpoint-neutral regulation. The court reversed the district court's rulings on the overbreadth and freedom-of-association claims, remanding for entry of judgment in favor of the defendants on these claims. The court also remanded the free-speech claim for further proceedings consistent with its opinion, applying intermediate scrutiny. View "VoteAmerica v. Schwab" on Justia Law

the State of Missouri bears no legal liability for any judgment against MOHELA. The Act makes clear that MOHELA’s debts and obligations are not debts or obligations of the State. See MO. REV. STAT. § 173.410. This includes any judgments against MOHELA. The State’s lack of legal liability for MOHELA’s debts and judgments is a strong indicator that MOHELA’s finances are independent from the State’s. See Hess, 513 U.S. at 51; Duke, 127 F.3d at 978.In sum, the third Steadfast factor weighs against arm-of-the-state status. MOHELA receives no direct financial assistance from the State, has the ability to generate its own revenue, retains control over its own funds, and the State bears no legal liability for MOHELA’s debts or judgments.d. Factor Four: State or Local AffairsThe fourth Steadfast factor considers whether the entity is concerned primarily with state or local affairs. This factor examines the entity’s function, composition, and purpose. See Hennessey, 53 F.4th at 528; Steadfast, 507 F.3d at 1253. Here, the district court concluded that this factor weighed in favor of arm-of-the-state status, and we agree.MOHELA’s primary function is to help Missourians access student loans needed to pay for college. See MO. REV. STAT. § 173.360. This is a statewide concern, not a local one. MOHELA’s activities are not confined to any particular locality within Missouri; rather, they are intended to benefit residents across the entire state. See Biden, 143 S. Ct. at 2366 (noting that MOHELA was established to perform the “essential public function” of helping Missourians access student loans).Moreover, MOHELA’s board is composed of members appointed by the Governor and representatives from state agencies, further indicating that its focus is on statewide, rather than local, affairs. See MO. REV. STAT. § 173.360. The fact that MOHELA’s profits are used to fund education in Missouri, including providing grants and scholarships for Missouri students, also supports the conclusion that MOHELA is concerned with state affairs. See Biden, 143 S. Ct. at 2366.In conclusion, the fourth Steadfast factor weighs in favor of arm-of-the-state status.3. The Second Step of the Arm-of-the-State Test: The Twin Goals of the Eleventh AmendmentBecause the Steadfast factors point in different directions, we proceed to the second step of the Hennessey test and consider the twin goals underlying the Eleventh Amendment: avoiding an affront to the dignity of the state and the impact of a judgment on the state treasury. See Hennessey, 53 F.4th at 528.As discussed above, the State of Missouri bears no legal liability for any judgment against MOHELA. This means that a judgment against MOHELA would not impact the state treasury. See Hess, 513 U.S. at 51; Duke, 127 F.3d at 978. The lack of impact on the state treasury is a strong indicator that MOHELA is not an arm of the state. See Hennessey, 53 F.4th at 528.Regarding the dignity of the state, MOHELA operates with substantial autonomy and is financially independent from the State. The State has not clearly demarcated MOHELA as sharing its sovereignty. See Hennessey, 53 F.4th at 529. Therefore, treating MOHELA as an arm of the state would not accord with the dignity interests protected by the Eleventh Amendment.In conclusion, considering the twin goals of the Eleventh Amendment, we determine that MOHELA is not an arm of the state entitled to Eleventh Amendment immunity. Accordingly, we reverse the district court’s judgment and remand for further proceedings consistent with this opinion. View "Good v. United States Department of Education" on Justia Law

Angelo Brock, an independent distributor for Flowers Baking Co. of Denver, LLC, filed a class-action lawsuit alleging wage and hour violations under the Fair Labor Standards Act and Colorado labor law. Brock claimed that Flowers misclassified its delivery drivers as independent contractors to avoid paying proper wages. Flowers moved to compel arbitration based on an Arbitration Agreement within the Distributor Agreement between Brock and Flowers. The district court denied the motion, leading to this appeal.The United States District Court for the District of Colorado found that Brock fell within the "transportation workers exemption" under § 1 of the Federal Arbitration Act (FAA), which exempts certain transportation workers from arbitration. The court concluded that Brock's class of workers, who deliver Flowers goods intrastate, are engaged in interstate commerce because they play a direct and necessary role in the flow of goods across state lines. The court also determined that the Arbitration Agreement did not allow for arbitration under Colorado law, as it was inconsistent with the FAA.The United States Court of Appeals for the Tenth Circuit affirmed the district court's decision. The Tenth Circuit agreed that Brock's class of workers is engaged in interstate commerce, as their intrastate deliveries are part of a continuous interstate journey of goods. The court found that Flowers retains significant control over Brock's operations, indicating that the goods' delivery to retail stores is the final leg of an interstate route. The court declined to review Flowers's argument that the Distributor Agreement is not a contract of employment, as it was not raised in the lower court. Additionally, the court determined it lacked jurisdiction to review the district court's denial of arbitration under Colorado law. View "Brock v. Flowers Foods" on Justia Law

In April 2023, Colorado Governor Jared Polis signed a law raising the minimum age for purchasing firearms in Colorado from 18 to 21. The law was set to take effect on August 7, 2023. Plaintiffs, including two individuals and a firearms advocacy group, filed a lawsuit in federal court seeking a preliminary injunction to prevent the law from taking effect. The district court granted the injunction on the day the law was to take effect, halting its enforcement. Governor Polis appealed the decision.The United States District Court for the District of Colorado initially found that the plaintiffs had standing, except for the advocacy group, and determined that the plaintiffs were likely to succeed on the merits of their Second Amendment challenge. The court concluded that the law was not consistent with the nation's historical tradition of firearms regulation and that the plaintiffs would suffer irreparable harm without the injunction. Governor Polis appealed the district court's decision, arguing that the plaintiffs lacked standing and that the law was consistent with historical firearm regulations.The United States Court of Appeals for the Tenth Circuit reviewed the case and reversed the district court's decision. The Tenth Circuit held that the plaintiffs did not demonstrate a substantial likelihood of success on the merits of their Second Amendment claim. The court found that the law was a presumptively lawful regulation imposing conditions on the commercial sale of firearms, which did not fall within the scope of the Second Amendment's protections. The court also determined that the plaintiffs did not establish irreparable harm and that the balance of harms and public interest favored the enforcement of the law. Consequently, the Tenth Circuit remanded the case with instructions to dissolve the preliminary injunction. View "Rocky Mountain Gun Owners v. Polis" on Justia Law

The plaintiff, a transgender woman, was diagnosed with gender dysphoria and prescribed hormone replacement therapy (HRT) while detained at the Oklahoma County jail. After being transferred to the Oklahoma Department of Corrections (ODOC), she continued her HRT regimen. However, upon her transfer to the Dick Conner Correctional Center, a staff psychologist evaluated her and concluded she did not have gender dysphoria. Based on this evaluation, the prison physician at the Davis Correctional Facility, where she was subsequently transferred, decided to taper and discontinue her HRT.The plaintiff filed a 42 U.S.C. § 1983 claim for deliberate indifference to serious medical needs against the prison physician and the health services administrator. The United States District Court for the Eastern District of Oklahoma granted summary judgment in favor of the defendants, concluding that no reasonable jury could find deliberate indifference because the discontinuation of HRT was in compliance with correctional policy, which required a confirmed diagnosis of gender dysphoria for HRT to continue.On appeal, the United States Court of Appeals for the Tenth Circuit affirmed the district court’s decision. The appellate court held that the defendants did not act with deliberate indifference by discontinuing the plaintiff’s HRT based on the psychologist’s evaluation and the correctional policy. The court found no evidence that the defendants knew or strongly suspected that the psychologist’s diagnosis was incorrect. Additionally, the court concluded that the plaintiff’s disagreement with the diagnosis and the course of treatment did not constitute a constitutional violation. The court also rejected the argument that the defendants were required to arrange for a second evaluation, as there was no indication that they suspected the initial diagnosis was wrong. View "Johnson v. Sanders" on Justia Law

The case involves an interlocutory appeal arising from a Securities and Exchange Commission (SEC) enforcement action against Michael Young and others, alleging a fraudulent investment scheme. The SEC claimed that the defendants raised over $125 million from investors by falsely representing the use of a profitable algorithmic trading strategy, misappropriating funds for personal gain, and misrepresenting the profitability of their trading scheme. The parties agreed to a preliminary injunction freezing the defendants' assets, with the defendants retaining the right to request relief from the freeze.The United States District Court for the District of Colorado denied the Youngs' motions to unfreeze assets on three occasions. In April 2020, the court denied their first motion. In November 2020, the court denied their second motion, and the Youngs appealed. The Tenth Circuit affirmed the district court's decision, holding that the Youngs had forfeited their arguments by not raising them properly in the lower court. In March 2023, the Youngs filed a third motion to unfreeze assets, which the district court also denied, citing the law of the case doctrine and improper reconsideration.The United States Court of Appeals for the Tenth Circuit reviewed the appeal and dismissed it for lack of jurisdiction. The court held that the March 2023 motion was a successive motion raising the same issues that could have been raised in the November 2020 motion. The court emphasized that there was no change in circumstances, evidence, or law since the prior motion that would warrant jurisdiction under 28 U.S.C. § 1292(a)(1). The court concluded that the Youngs failed to demonstrate a close nexus between any change and the issues raised on appeal, thus affirming the district court's denial of the motion to unfreeze assets. View "USSEC v. Mediatrix Capital" on Justia Law

The defendant was convicted of two counts of witness tampering and one count of voluntary manslaughter. The presentence report recommended grouping all three counts under the U.S. Sentencing Guidelines, but the district court declined to do so. The defendant appealed, arguing that the Guidelines required all three convictions to be grouped.The United States District Court for the District of New Mexico initially grouped the two witness tampering counts under U.S.S.G. § 3D1.2(b) but did not group them with the manslaughter count under § 3D1.2(c). The district court used uncharged obstructive conduct to enhance the manslaughter count, resulting in a higher offense level and a sentencing range of 168-210 months. The defendant was sentenced to 210 months' imprisonment.The United States Court of Appeals for the Tenth Circuit reviewed the case and found that the relevant Guidelines were grievously ambiguous. The court concluded that the rule of lenity required the Guidelines to be construed in the defendant's favor. The court vacated the defendant's sentence and remanded for resentencing under an offense level of 31, which corresponds to a lower sentencing range of 151-188 months. View "United States v. Tony" on Justia Law

The case involves Rhonda Mengert, who was subjected to a private inspection by Transportation Security Officers (TSOs) at Tulsa International Airport. After an initial screening and pat-down revealed an unidentified object in her groin area, Mengert was taken to a private room and directed to lower her pants and remove the object, which turned out to be a feminine hygiene product. Mengert claimed the incident caused her to experience panic attack symptoms, which recur when she travels by plane. She filed claims under the Federal Tort Claims Act (FTCA) for intentional infliction of emotional distress (IIED) and false imprisonment.The United States District Court for the Northern District of Oklahoma denied the government's motion to dismiss for lack of jurisdiction based on sovereign immunity but granted the government's motion to dismiss the IIED claim under Rule 12(b)(6). The court also denied Mengert's motion for leave to amend her complaint and granted the government's motion for summary judgment on the false imprisonment claim. Mengert appealed these decisions.The United States Court of Appeals for the Tenth Circuit first affirmed the district court's jurisdiction, concluding that TSOs are "investigative or law enforcement officers" under 28 U.S.C. § 2680(h), thus waiving sovereign immunity for Mengert’s claims. However, the court found that Mengert failed to allege sufficiently severe emotional distress to sustain an IIED claim under Oklahoma law. The court also held that Mengert's false imprisonment claim, treated as a false arrest claim, failed because she did not challenge the lawfulness of her detention but rather the conduct during the detention, which is not sufficient under Oklahoma law.Finally, the Tenth Circuit affirmed the district court's denial of Mengert's motion for leave to amend her complaint, finding no "good cause" for the delay in filing the motion. Consequently, the court affirmed all the district court's decisions. View "Mengert v. United States" on Justia Law

Plaintiffs, consisting of individuals and advocacy organizations, challenged a New Mexico Department of Health (NM DOH) Public Health Order (PHO) that restricted firearm carry in public parks and playgrounds in Albuquerque and Bernalillo County. They argued that the PHO violated the Second and Fourteenth Amendments of the U.S. Constitution.The United States District Court for the District of New Mexico initially issued a Temporary Restraining Order (TRO) against parts of the first PHO. After the NM DOH amended the PHO, the plaintiffs sought preliminary injunctions against the amended order. The district court denied the motion for a preliminary injunction, finding that the plaintiffs failed to show a substantial likelihood of success on the merits.The United States Court of Appeals for the Tenth Circuit reviewed the case. The court found that the plaintiffs' appeal regarding the public parks restriction was moot because a separate case, Springer v. Grisham, had already granted a preliminary injunction against the same restriction. The court determined that any relief granted would not have a real-world effect since the plaintiffs had already received the relief they sought.Regarding the playgrounds restriction, the court found that the plaintiffs lacked standing. The court noted that existing city and county regulations independently restricted firearm carry in playgrounds, and the plaintiffs did not demonstrate how enjoining the PHO would allow them to lawfully carry firearms in those areas. The court concluded that the plaintiffs failed to show that a favorable decision would redress their alleged injuries.The Tenth Circuit dismissed the appeal, finding that the plaintiffs' claims were either moot or lacked standing. View "We the Patriots v. Grisham" on Justia Law