Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

Smith claimed (42 U.S.C. 1981) that he endured serious racist harassment from his immediate supervisor at former defendant Equistar and was fired for complaining about it. Equistar was an affiliate of another former defendant, Lyondell, but both are now bankrupt. Smith has settled his claims against the primary wrongdoer, his former supervisor Bianchetta. He also brought claims against Equistar’s human resources manager, Bray, who, Smith says conspired with Bianchetta to retaliate against him. The district court granted Bray for summary judgment. The Seventh Circuit affirmed. The retaliation claim did not satisfy the causation element of the direct method of proof because Smith did not present sufficient circumstantial evidence showing that his complaints about discrimination motivated Bray to seek his termination. Constructive discharge occurs when working conditions become so unbearable that an employee is forced to resign; the evidence showed that Smith was fired.

Siblings of decedent, a 22-year-old inmate who committed suicide while incarcerated, sued under 42 U.S.C. 1983 alleging that staff members acted with deliberate indifference to his serious medical condition involving a long history of suicide attempts, self-harm, and mental illness. The district court granted qualified immunity to the management level defendants, the Wisconsin Resource Center defendants, and the nurse who was called after the suicide, but denied qualified immunity to staff members. The Seventh Circuit affirmed, noting the different levels of knowledge available to the defendants and that there is a clearly established right to be free from deliberate indifference to suicide

Between 2004 and 2008, Brown ran an elaborate scheme that tricked lenders into issuing fraudulent mortgage loans in Chicago and Las Vegas. Brown recruited or directed dozens of individuals: lawyers, accountants, loan officers, bank employees, realtors, home builders, and nominee buyers. Of his accomplices, 32 people were criminally charged. The Chicago scheme resulted in about 150 fraudulent loans, totaling more than $95 million in proceeds from victim lenders. The Las Vegas scheme resulted in approximately 33 fraudulent loans totaling about $16 million. Brown entered guilty pleas and was sentenced to 216 months’ imprisonment for the Las Vegas scheme and 240 months’ imprisonment for the Chicago scheme, to run concurrently. The district court also imposed a restitution amount of more than $32.2 million. The Seventh Circuit affirmed Brown’s sentence, rejecting a challenge to the loss calculation. The court remanded the 66-month sentence and $7.1 restitution order against another participant in the Chicago scheme because the court incorrectly determined the number of victims.

Defendant was arrested while officers executed a warrant at his apartment, and, based on items found and statements to officers, was charged with possession of cocaine base with intent to distribute, possession of Ecstasy with intent to distribute, and possession of a firearm by a convicted felon. After denial of a motion to suppress, the case was dismissed without prejudice under the Speedy Trial Act, 18 U.S.C. 3162(a)(2). The grand jury returned another indictment, based on the same circumstances. Defendant was convicted of possession with intent to distribute 50 grams or more of crack cocaine, 21 U.S.C. 841(a)(1), (b)(1)(A), and possession of a firearm by a convicted felon, 18 U.S.C. 922(g)(1). He was sentenced, as a "career offender" and applying an obstruction of justice enhancement, to 300 months' imprisonment. After granting a motion to expand the record, the Seventh Circuit affirmed.

In 1984 petitioner was convicted of murder, attempted murder, aggravated battery, and attempted robbery. During six jury selection striking sessions, both sides used all 20 of their peremptory challenges; the state exercised 17 on African-Americans. Two African-Americans served on the jury and one was an alternate. Petitioner was sentenced to death. Following the decision Batson v. Kentucky, 1986, the Illinois Supreme Court remanded. The trial court accepted the state’s race-neutral reasons for the strikes. The Illinois Supreme Court vacated the death sentence and conditionally vacated the convictions, holding that petitioner established a prima facie case of discrimination. On remand the trial court found no Batson violation, again imposing the death penalty. The Illinois Supreme Court affirmed. The trial court dismissed a postconviction petition, claiming ineffective-assistance-of-counsel in the Batson hearing and a Brady violation based on nondisclosure of medical records that would have impeached a witness. On remand from the supreme court, the trial court dismissed because Illinois Governor Ryan had commuted the death sentence. The appellate court affirmed; the supreme court denied review. The federal district court denied habeas relief, 28 U.S.C. 2254. The Seventh Circuit reversed. It was unreasonable for the state courts to credit the prosecutor’s proffered reasons for several peremptory challenges.

Plaintiff, hired as a police officer in 1992 and promoted to sergeant and shift supervisor in 1996, publicly criticized several departmental officials at two police officers’ union meetings. Roughly during that same time period, he also committed several violations of departmental policy and was punished accordingly with, among other things, a written reprimand and a two-day suspension. After plaintiff failed to clear a fitness-for-duty evaluation, the department filed termination charges. The matter was assigned to arbitration where he was suspended but not terminated. The district court rejected his claims of retaliation under 42 U.S.C. 1983. The Seventh Circuit affirmed. None of the employment actions that plaintiff complained about followed close on the heels of his purportedly protected speech. The context in which these actions were taken indicates that they were not related to his speech. Significant intervening, particularly plaintiff's own negative behavior, were the cause of the negative or disciplinary employment actions.

KSM failed to reinstate strikers after the union made an unconditional offer to return to work in 1997. In 2001, the NLRB ruled that KSM violated the NLRA, 29 U.S.C. 158(a)(3), and ordered backpay. The parties entered into partial settlement 2006, but there was no further progress. The ALJ attempted a remedial order in 2007, but the case was held up for a year and a half pending the Board having the necessary quorum. In 2010 the Board issued a Second Supplemental Decision and Order requiring KSM to compensate 42 former striking employees with backpay totaling $383,461.11. The Seventh Circuit granted a petition to enforce that order, upholding a seniority method of recall and rejecting challenges to pay for specific workers.

Aegis sold sham “trusts,” promising asset protection and reduced tax liability. Clients paid initially paid $20,000 to $40,000 and an annual fee of $3,000 to $7,000. Defendants continued the scheme, despite a 2000 search of their office, investigation by the IRS and FBI, and participants receiving audit requests. Defendants received over $350,000 in fees and caused tax loss of about $6 million. Wasson was charged in 2006 with aiding in filing a false tax return, 26 U.S.C. 7206(2). The grand jury twice superseded the indictment to add Starns and Wolgamot, add counts under 7206(2), and charge all defendants with conspiracy to defraud the IRS, 18 U.S.C. 371. The third indictment was returned May 2, 2007. The district court made an unopposed finding that the case was complex and warranted excluding time until May 1, 2007, 18 U.S.C. 3161(h)(7)(A). Additional delays were attributable to new defense counsel, Starns’s death, Wolgamot’s plea, and government counsel’s participation in Guatanamo litigation. The district court rejected Wasson’s motion to dismiss under the Speedy Trial Act, 18 U.S.C. 3161-74, found him guilty in December 2009, calculated his advisory guideline range using the 2008 Guidelines, and sentenced Wasson to 180 months, (middle of the range). The Seventh Circuit affirmed on all issues.

Medicare pays teaching hospitals for work by residents when a teaching physician supervises. During the 1990s, HHS concluded that many hospitals were billing for unsupervised services and began to audit invoices. There was also a GAO report and private litigation: qui tam suits under the False Claims Act, allowing relators to collect a bounty. Under 31 U.S.C. 3730(e)(4)(A), suits cannot be based upon public disclosure of allegations or transactions in public agencies’ official reports unless the relator is an original source of information. A prior case concluded that the 1998 GAO report and similar public documents disclosed that billing for unsupervised work was common practice. The district court dismissed a suit filed against a teaching hospital in 2004, claiming to describe conduct, such as inadequate supervision, not previously disclosed. The Seventh Circuit vacated. No one who read the GAO report, or followed the progress of the audits, would suspect that Rush University was misrepresenting "immediate availability" of teaching physicians during concurrently scheduled procedures. The complaint alleged a kind of deceit that the GAO report does not attribute to any teaching hospital.

In 1997 Javier unlawfully entered the U.S.; he married in 2001. In 2007 the bank hired wife. Husband, attempting to start a business, could not open a bank account without a social security number. He obtained an individual tax identification number. Wife named him a joint owner on her account and helped use his ITIN to open accounts of his own. The business failed. Husband returned to Mexico to deal with his citizenship. Wife revealed the situation to her supervisor, requesting time off to help husband obtain citizenship. The supervisor agreed and called the bank security officer, who was concerned that the accounts might implicate bank fraud laws. During a meeting, the security officer became angry and berated wife. Wife refused to attend another meeting without her attorney The bank terminated her employment and reported her activity to U.S. Immigration and Customs Enforcement and a consortium of area banks. Wife sued, claiming blacklisting, defamation, emotional distress, and employment discrimination, 42 U.S.C. 2000e. The district court granted the bank summary judgment. The Seventh Circuit affirmed, holding that any discrimination was not based on race or national origin, but on an unprotected classification, husband’s status as an alien lacking permission to be in the country.