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

Losing money on every box fan it sold, Lakewood authorized CAM to practice Lakewood’s patents and put its trademarks on completed fans. Lakewood was to take orders; CAM would ship to customers. CAM was reluctant to gear up for production of about 1.2 million fans that Lakewood estimated it would require during the 2009 season. Lakewood provided assurance by authorizing CAM to sell the 2009 fans for its own account if Lakewood did not purchase them. Months later, Lakewood’s creditors filed an involuntary bankruptcy petition against it. The court-appointed trustee sold Lakewood’s business. Jarden bought the assets, including patents and trademarks. Jarden did not want Lakewood-branded fans CAM had in inventory, nor did it want CAM to sell them in competition with Jarden’s products. Lakewood’s trustee rejected the executory portion of the CAM contract, 11 U.S.C. 365(a). CAM continued to make and sell Lakewood fans. The bankruptcy judge found the contract ambiguous, relied on extrinsic evidence, and concluded that CAM was entitled to make as many fans as Lakewood estimated for the 2009 season and sell them bearing Lakewood’s marks. The Seventh Circuit affirmed, rejecting an argument that CAM had to stop making and selling fans once Lakewood stopped having requirements. View "Sunbeam Prods, Inc. v. Chicago Am. Mfg." on Justia Law

Mota was convicted of attempting to distribute 500 grams or more of cocaine and of possessing with the intent to distribute 500 grams or more of cocaine, 21 U.S.C. 841(a)(1) and 21 U.S.C. 846. At the start of his jury trial, Mota learned that a government agent had failed to record and relay exculpatory evidence regarding a conversation between the agent and co-defendant Ponce, during which conversation Ponce assumed complete responsibility for the crime and proclaimed Mota’s innocence. The Seventh Circuit affirmed, rejecting a “Brady” argument. While the failure to transmit exculpatory evidence was inexcusable, Mota learned of this evidence at the start of his trial and thoroughly presented it to the jury. He had opportunity to cross-examine the negligent agent and Ponce testified on his behalf; he was not denied a fair trial. There was sufficient evidence for the jury to find guilt beyond a reasonable doubt, including testimony from the government informant who met Ponce and Mota in order to conduct a drug deal and the audio recording of this sting operation. View "United States v. Mota" on Justia Law

Defendants were convicted of conspiring to entice underage girls to engage in prostitution, to transport them (along with adult women) in interstate commerce to engage in prostitution, to use force and fraud to coerce adult women to engage in prostitution, and to commit related offenses and of the underlying offenses, 18 U.S.C. 1591, 2421, 2423. The judge sentenced ringleaders to life in prison and another to 324 months. The Seventh Circuit affirmed, rejecting an argument that the indictment was “duplicitous." With respect to an argument based on the government’s frequently posing leading questions, the court stated that the judge was too hard on the prosecution. One defendant’s argument that his 324-month sentence is grossly disproportionate to his role was frivolous, but another defendant was entitled to remand because of an ambiguity in his sentence. At the sentencing hearing the judge imposed life sentences on him on seven counts for which the jury convicted him, and on the other seven counts of conviction imposed sentences ranging from 5 to 10 years. The judge added that the sentences are “all to be served consecutively to each other.” The written judgment, however, states that all the sentences are “to be served concurrently.” View "United States v. Cephu" on Justia Law

Collins served as a city councilman and vice-mayor of East St. Louis. In 2002 he moved to the suburbs, but continued to use his previous address to vote East St. Louis and to establish residency for election to as precinct committeeman for the Democratic Party. Federal agents checked tax filings to verify his residency and discovered that Collins had not filed federal or state income tax returns for almost two decades. Convicted of multiple counts of tax evasion, willful failure to file tax returns, and voter fraud, he was given a within-guidelines sentence of 50 months. The Seventh Circuit affirmed. The district court used pattern jury instructions for tax evasion, which properly define the required element of willfulness and need no clarification to distinguish tax evasion from negligent failure to file. It is not “remotely plausible” to attribute tax delinquency of almost two decades to negligence. The court properly stated Illinois law regarding requirements for establishing voting residency. The evidence was “easily sufficient” to support the verdict. Collins did not file tax returns, and to hide his income, commingled personal and business accounts, used a false Employer Identification Number, and misappropriated the Social Security Number of his deceased business partner. View "United States v. Collins" on Justia Law

TAMS, a medical device manufacturer, hired Comtrans to coordinate shipment of equipment to a trade show in Chicago. Comtrans is not a carrier. It used its affiliate, ACS, which retained Atlas to perform the actual shipment. The Atlas truck was involved in a serious accident, leaving TAMS with more than $1 million in losses. TAMS’s insurance company sued on behalf of TAMS. Atlas is an interstate motor carrier authorized by the Federal Motor Carrier Safety Administration to transport goods in interstate commerce. Claims are subject to the Carmack Amendment, 49 U.S.C. 14706, which provides that a carrier of property in interstate commerce is liable for the actual loss or injury to the property caused b” the carrier, which may be limited “to a value established by written or electronic declaration of the shipper or by written agreement between the carrier and shipper if that value would be reasonable under the circumstances.” Atlas relied on the contract it had in place with ACS and the bill of lading delivered signed by a Comtrans warehouse manager when Atlas picked up TAMS’s shipment, as limiting liability to $0.60 per pound. The district court entered summary judgment for Atlas. The Seventh Circuit remanded for further development of the facts. View "Nipponkoa Ins. Co., L v. Atlas Van Lines, Inc." on Justia Law

Griffin was convicted of intentional possession of a firearm and ammunition as a convicted felon, 18 U.S.C. 922(g)(1). The Seventh Circuit reversed. Griffin was living with his parents and was, therefore, present in a home where firearms belonging to his father were present, but the government offered no evidence that would have allowed a reasonable jury to find beyond a reasonable doubt that he had constructive possession of the firearm and ammunition by intending to exercise control over them. The weapons were found during a SWAT team search for Griffin’s brother. View "United States v. Griffin" on Justia Law

Breshers entered a consumer installment loan business with a gun. Employees M and T told him they had no money. He directed them to leave their cell phones, lock the office, and get into T’s car. In the car, Breshers told them that he needed money. T suggested that they could get money from the business. He told her to drive back to the office and, once there, T wrote a check for $3,000. They unsuccessfully attempted to cash the check at a nearby bank. M and T then stated that they had about $1,000 at the business. , Breshers ordered them to return to the office, where they gave him $1,104. Breshers then instructed them to get back into the car. He released the two unharmed beside the highway. Convicted of kidnapping and interference with commerce by robbery, 18 U.S.C. 1201(a)(1) and 1951, Breshers was sentenced to 293 months of imprisonment and restitution of $44,618.50 (Mandatory Victims Restitution Act, 18 U.S.C. 3663A). The victims testified about emotional harm and expenses incurred as a result of the incident. The Seventh Circuit affirmed, rejecting an argument that the restitution was unauthorized because his victims did not suffer physical injury. View "United States v. Breshers" on Justia Law

A former inmate sued under the Rehabilitation Act, 29 U.S.C.794–94e, the Americans with Disabilities Act, 42 U.S.C. 12111–213, and the Eighth Amendment, claiming that prison officials ignored his need for placement in an ADA-compliant facility, and refused to consider him for a work-release program solely because he walks with a cane. Imprisoned for driving on a suspended license, the inmate had advanced osteoarthritis and vascular necrosis in his hip. The prison declined his request for installation of grab bars or for a transfer. The district court screened the complaint before service and dismissed. The Seventh Circuit vacated. While the court correctly dismissed the Eighth Amendment count, the inmate adequately alleged that refusal to accommodate his disability kept him from accessing meals and showers on the same basis as other inmates. View "Jaros v. Taylor" on Justia Law

An Illinois prisoner who alleges that he is confined to a wheelchair because of an unspecified “nerve condition” claimed that, by applying a quorum rule, prison officials subjected him to cruel and unusual punishment and violated his rights under the Americans with Disabilities Act. Under the rule, under which outdoor recreation does not occur without participation by10 disabled individuals, defendants allegedly refused to allow him to engage in any physical outdoor recreational activity for seven weeks. The district court dismissed. The Seventh Circuit reversed and remanded. Regardless of whether state officials are immune under the ADA, the Rehabilitation Act, 29 U.S.C. 701, applies and the suit was dismissed prematurely. View "Norfleet v. Walker" on Justia Law

The Directors & Officers Liability policy contains an insured vs. insured exclusion that removes the duty to defend or indemnify for “Loss on account of any Claim ... by or on behalf of any Insured or Company in any capacity.” The allocation clause provides: “If ... Insureds incur an amount consisting of both Loss covered by this Policy and loss not covered … because the Claim includes both covered and uncovered matters, such amount shall be allocated between covered Loss and uncovered loss based upon the relative legal exposures of the parties to covered and uncovered matters.” Five plaintiffs sued SCBI and directors and officers, asserting fraud, civil conspiracy, and violation of the Illinois Consumer Fraud and Deceptive Business Practices Act. The insurer declined to advance defense costs or otherwise indemnify SCBI, citing the exclusion. Two plaintiffs are former directors of SCBI who are insureds; a third is also included in the definition. The district court dismissed, finding no duty to defend or to indemnify. The Seventh Circuit held that the insurer has no duty to defend or indemnify the claims brought by the three insured plaintiffs, but must defend and indemnify with respect to the two non-insured plaintiffs. View "Miller v. St. Paul Mercury Ins. Co." on Justia Law