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

During the 2008 financial crisis, Congress created the Federal Housing Finance Agency and authorized it to place into conservatorship the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation (Fannie Mae and Freddie Mac), 12 U.S.C. 4617(a) and empowered the U.S. Treasury to purchase their “obligations and other securities” through 2009. In exchange for a cash infusion and fixed funding commitment for each enterprise, Treasury received senior preferred shares and extraordinary governance and economic rights, including the right to receive dividends tied to the amount of Treasury’s payments. As Fannie and Freddie’s capital needs grew, Treasury agreed to modify the original agreements. The First and Second Amendments primarily increased Treasury’s funding commitment. The third modification, made after Treasury’s purchasing authority expired, set Treasury’s dividend rights equal to the companies’ outstanding net worth. Plaintiffs, private shareholders of Fannie and Freddie, sued, claiming that the Agency violated its duties by agreeing to the net‐worth dividend and by unlawfully succumbing to the direction of Treasury and that Treasury exceeded its statutory authority and failed to follow proper procedures. The Seventh Circuit affirmed dismissal. Section 4617(f) bars “any” judicial interference with the “exercise of powers or functions of the Agency as a conservator.” The purpose of the conservatorship is the “reorganizing, rehabilitation, or winding up” of the companies’ affairs, not just the preservation of assets. Wiping out Treasury’s acceptance of the original agreements or the Third Amendment would undermine the conservatorships. View "Roberts v. Federal Housing Finance Agency" on Justia Law

The Byrne Memorial Justice Assistance Grant Program allocates substantial funds annually to provide for the needs of state and local law enforcement, including personnel, equipment, training. In 2017, the Attorney General tied receipt of the funds to the recipient’s compliance with conditions. Chicago, a “sanctuary city,” argued the conditions were unlawful and unconstitutional. The district court agreed and enjoined, nationwide, the enforcement of a condition mandating advance notice to federal authorities of the release date of persons in state or local custody who are believed to be aliens and a condition requiring the local correctional facility to ensure agents access to such facilities to meet with those persons. Compliance with those conditions would require the allocation of state and local resources, including personnel. The Seventh Circuit affirmed, noting that it was not assessing “optimal immigration policies” but enforcing the separation of powers doctrine. The statute precisely describes the formula through which funds should be distributed to states and local governments and imposes precise limits on the extent to which the Attorney General can deviate from that distribution. It “is inconceivable that Congress would have anticipated" that the Attorney General could abrogate the distribution scheme and deny funds to states and localities that would qualify under the Byrne JAG statutory provisions, based on a decision to impose conditions—the putative authority for which is provided in another statute (34 U.S.C. 10102(a)(6)). View "City of Chicago v. Sessions" on Justia Law

University Park hired Linear as its Village Manager through May 2015, concurrent with the term of its Mayor. In October 2014 the Village extended Linear’s contract for a year. In April 2015 Mayor Covington was reelected. In May, the Board of Trustees decided that Linear would no longer be Village Manager. His contract provides for six months’ severance pay if the Board discharges him for any reason except criminality. The Village argued that the contract’s extension was not lawful and that it owes Linear nothing. The district court agreed and rejected Linear’s suit under 42 U.S.C. 1983, reasoning that 65 ILCS 5/3.1-30-5; 5/8-1-7 prohibit a village manager's contract from lasting beyond the end of a mayor’s term. The Seventh Circuit affirmed on different grounds. State courts should address the Illinois law claims. Linear’s federal claim rests on a mistaken appreciation of the role the Constitution plays in enforcing state-law rights. Linear never had a legitimate claim of entitlement to remain as Village Manager. His contract allowed termination without cause. His entitlement was to receive the contracted-for severance pay. Linear could not have a federal right to a hearing before losing his job; he has at most a right to a hearing to determine his severance pay--a question of Illinois law. View "Linear v. Village of University Park" on Justia Law

The Mayor of Chicago appoints the city’s Board of Education, 105 ILCS 5/34-3. Until 1995, the Mayor needed the consent of the City Council; now the Mayor acts independently. Plaintiffs claimed that the system violated the Voting Rights Act, 52 U.S.C. 10301 (section 2). School boards elsewhere in Illinois are elected; plaintiffs say that failure to elect the school board in Chicago has a disproportionate effect on minority voters. The Seventh Circuit affirmed the dismissal of the complaint. Section 2(a) covers any “voting qualification or prerequisite to voting or standard” that results in an abridgment of the right to vote; it does not guarantee that any given public office be filled by election rather than appointment, a civil service system, or some other means. Whether having an appointed board is “good government” or good for pupils is irrelevant to the Act. While more minority citizens live in Chicago than in other Illinois cities and do not vote for school board members, neither does anyone else. Every member of the electorate is treated identically, which is what section 2 requires. View "Quinn v. Board of Education of the City of Chicago" on Justia Law

The Mayor of Chicago appoints the city’s Board of Education, 105 ILCS 5/34-3. Until 1995, the Mayor needed the consent of the City Council; now the Mayor acts independently. Plaintiffs claimed that the system violated the Voting Rights Act, 52 U.S.C. 10301 (section 2). School boards elsewhere in Illinois are elected; plaintiffs say that failure to elect the school board in Chicago has a disproportionate effect on minority voters. The Seventh Circuit affirmed the dismissal of the complaint. Section 2(a) covers any “voting qualification or prerequisite to voting or standard” that results in an abridgment of the right to vote; it does not guarantee that any given public office be filled by election rather than appointment, a civil service system, or some other means. Whether having an appointed board is “good government” or good for pupils is irrelevant to the Act. While more minority citizens live in Chicago than in other Illinois cities and do not vote for school board members, neither does anyone else. Every member of the electorate is treated identically, which is what section 2 requires. View "Quinn v. Board of Education of the City of Chicago" on Justia Law

Cannici was a Melrose Park firefighter for 16 years before being terminated for violation of the Residency Ordinance. Cannici and his family lived in Melrose Park until 2008 when they bought a home in Orland Park while retaining ownership of their Melrose Park home. During the week, Cannici’s wife and children lived in Orland Park, while Cannici lived in Melrose Park, spending weekends together in one of the homes. In 2013, Cannici rented the Melrose Park home out, reserving part of the basement for his exclusive use. He kept belongings in the home, paid utilities and taxes, and received all of his mail at the Melrose Park address, but slept in Orland Park between June 2013 and June 2016. In May 2016, the Village requested an interview to inquire about his residency. The Board of Fire and Police Commissioners issued a written Statement of Charges, seeking to terminate his employment. Before his hearing, Cannici filed an unsuccessful motion challenging purported ex parte communications between the prosecuting attorney and the Board’s attorney. The Seventh Circuit affirmed the dismissal of Cannici’s equal protection and due process claims. The Illinois statute does not provide full protection from termination; the Village afforded Cannici what the statute requires: written charges, a hearing, and the opportunity to present evidence. View "Cannici v. Village of Melrose Park" on Justia Law

The National Organic Standards Board, an advisory committee, has 15 members, all appointed by the Secretary of Agriculture, 7 U.S.C.6518(b), (c); its principal task is advising the Secretary what belongs on the “National List of approved and prohibited substances that shall be included in the standards for organic production and handling” Plaintiffs, who operate organic farms, asked the Secretary to appoint them to the Board, but the Secretary appointed Beck and Swaffar. Plaintiffs contend that Beck and Swaffar are ineligible to fill the seats to which they were appointed. The Seventh Circuit affirmed the dismissal of the suit for lack of standing. Beck and Swaffer, appointed to seats reserved for “individuals who own or operate an organic farming operation,” were office employees of agribusinesses that produce some organic products and some non-organic products. Plaintiffs argued that by deflecting the Board from making recommendations most likely to promote organic farmers’ interests, Beck and Swaffar have called organic-farming into disrepute and reduced organic sales; that is not the kind of person-specific loss needed to show standing. Any injury plaintiffs assert could not be redressed by a favorable decision. The Secretary has a statutory right to appoint Board members but no corresponding duty to evaluate any particular applicant. View "Cornucopia Institute v. United States Department of Agriculture" on Justia Law

Jane Doe is a transgender man residing in Marion County, Indiana. Doe is originally from Mexico. The U.S. granted him asylum because of the persecution he might face in Mexico for being transgender. Doe alleges that he faces harassment and discrimination in the U.S. when he gives his legal name or shows his identification to others. Doe sought to legally change his name from Jane to John so that his name conforms to his gender identity and physical appearance, which are male. Doe asserts that the statute governing name changes is unconstitutional because it requires petitioners to provide proof of U.S. citizenship, Ind. Code 34‐28‐2‐2.5(a)(5). As an asylee, Doe cannot provide such proof. The Seventh Circuit affirmed the dismissal of Doe’s case for lack of standing. The Eleventh Amendment generally immunizes state officials from suit in federal court unless the official has “some connection with the enforcement” of an allegedly unconstitutional state statute. The Governor, the Attorney General, and the Executive Director of the Indiana Supreme Court Administration, do not enforce the challenged law. The County Clerk of Court is not a state official, but Doe cannot establish “redressability” because the Clerk has no power to grant or deny a name-change petition but may only accept and process petitions. View "Doe v. Holcomb" on Justia Law

Jane Doe is a transgender man residing in Marion County, Indiana. Doe is originally from Mexico. The U.S. granted him asylum because of the persecution he might face in Mexico for being transgender. Doe alleges that he faces harassment and discrimination in the U.S. when he gives his legal name or shows his identification to others. Doe sought to legally change his name from Jane to John so that his name conforms to his gender identity and physical appearance, which are male. Doe asserts that the statute governing name changes is unconstitutional because it requires petitioners to provide proof of U.S. citizenship, Ind. Code 34‐28‐2‐2.5(a)(5). As an asylee, Doe cannot provide such proof. The Seventh Circuit affirmed the dismissal of Doe’s case for lack of standing. The Eleventh Amendment generally immunizes state officials from suit in federal court unless the official has “some connection with the enforcement” of an allegedly unconstitutional state statute. The Governor, the Attorney General, and the Executive Director of the Indiana Supreme Court Administration, do not enforce the challenged law. The County Clerk of Court is not a state official, but Doe cannot establish “redressability” because the Clerk has no power to grant or deny a name-change petition but may only accept and process petitions. View "Doe v. Holcomb" on Justia Law

The plaintiffs formed the Fredericksburg partnership to search for oil and contracted with Kraft for management services. The IRS began a criminal investigation of the partnership, Kraft, and Kraft principals Valeri and Blum. In 2003, the plaintiffs and the IRS settled allegations against the partnership in exchange for the payment of taxes for the tax year 1994. The statute of limitations for 1994 tax liability had expired, but the IRS had obtained a waiver from Valeri. The plaintiffs allege that the IRS did not sign the agreement and Valeri could not waive the statute of limitations on plaintiffs’ behalf, 26 U.S.C. 6229(a)–(b); that the IRS never sent the plaintiffs required notices that the IRS had begun an administrative proceeding, 26 U.S.C. 6223(a); and that plaintiffs did not discover these alleged violations until 2009. The plaintiffs never sent formal refund claims but filed suit in 2012. The Seventh Circuit affirmed dismissal of the refund claims for lack of jurisdiction for failure to exhaust administrative remedies and claims for damages because they alleged IRS errors only in assessing taxes, not in collecting them, and were outside the scope of section 7433. The court rejected claims to exceptions under the “informal claim doctrine,” noting that the plaintiffs never perfected their claims. View "Goldberg v. United States" on Justia Law