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

Defendant sold crack cocaine to his nephew, who was a paid DEA informant and who recorded the transaction and turned over 22 grams of crack purchased with $1250 of DEA money. Based on the recording, agents obtained a warrant, had the nephew execute another controlled buy, then search the house and found large quantities of drugs. Defendant acknowledged ownership of the drugs. The nephew later signed an affidavit and recorded a video, swearing that he had obtained the crack on the night of the search not from defendant, but from someone outside the house, and that he had lied in stating that defendant was a drug dealer. The nephew left the state and refused to cooperate. No party sought a material witness warrant. The judge rejected the recantation as hearsay. Convicted of possession of at least 280 grams of crack cocaine with intent to distribute, defendant was sentenced to 288 months in prison. The Seventh Circuit affirmed, rejecting claims that defendant’s statement about ownership should have been excluded because he had not received his Miranda warnings; that showing the videotape of the second buy to the jury, in the absence of the nephew, violated defendant’s constitutional right to confront witnesses against him; and of ineffective assistance. View "United States v. Wallace" on Justia Law

In 2008 the Kathreins challenged Evanston’s Affordable Housing Demolition Tax under the Fifth and Fourteenth Amendments. The Tax required a property owner seeking to demolish any residential building to pay the greater of $10,000 per building, or $3,000 per unit. The measure is to “provide a source of funding for the creation, maintenance, and improvement of safe and decent affordable housing; proceeds go to the city’s Affordable Housing Fund. The Kathreins alleged that a developer, learning of the Tax, lowered his bid on their property. The sale fell through. The Kathreins also alleged the unconstitutionality of the Tax Injunction Act (TIA), 28 U.S.C. 1341, which forbids federal courts to enjoin assessment or collection “of any tax under State law,” so long as there is a remedy in state court. The district court dismissed. A Seventh Circuit panel reversed in part, holding that the Demolition Tax was a regulatory device, not a tax under the TIA, because it provided a deterrent against demolition of residential buildings and raised little revenue. Before the district court could resolve remaining claims on remand, the Seventh Circuit, en banc, rejected the approach to identifying a tax taken in the Kathrein case, holding that an “exaction[] designed to generate revenue” was a tax, contrasted to fines “designed … to punish,” and fees that “compensate for a service,” but did not directly overrule the Kathrein decision. The district court applied the new holding and again dismissed. The Seventh Circuit affirmed, stating that the decision of the en banc court did effect an intervening change in the law. View "Kathrein v. City of Evanston, IL" on Justia Law

DEA task force members went to Beltran’s two-unit residence. Ramirez came to the front porch. He did not speak English well but had the building owner (Beltran) on the phone; he gave the phone to an agent. Beltran indicated that it would take him an hour to get home. Beltran and Ramirez agreed to a search if the officers waited until Beltran arrived. Ramirez remained on the porch with the officers. Ramirez placed several calls (speaking in Spanish). He appeared nervous. Ramirez said that there was no one in the building, but officers heard sounds of human movement. In garbage cans, outside of a fence and marked for Beltran’s building, an officer discovered packaging that looked like it had been used to wrap “bricks” of narcotics. Posted behind the residence, an officer saw Beltran emerge through the back door, stopped and frisked him, felt something in Beltran’s pocket, and confirmed that it was substantial cash. Beltran withdrew his consent for a search. A Spanish-speaking agent obtained Ramirez's consent to search. In the Ramirez apartment they found bins containing more than a million dollars, packaging material like in the garbage cans, nine kilograms of heroin, a loaded gun, and other items consistent with narcotics trafficking. Beltran stated that he would cooperate and agreed to a search, which produced a shotgun, scales, a heat sealer, drug-cutting agents, packaging material, and baggies. A drug-sniffing dog alerted to the baggies. A dryer on the second floor landing contained another large stash of money and three kilograms of cocaine. Beltran claimed that his consent was the product of coercion, as he was handcuffed. The district court denied his motion to suppress. He was convicted of possessing and conspiring to possess, with the intent to distribute, 500 grams or more of cocaine and one kilogram or more of heroin, 26 U.S.C. 841(a)(1), 846 and sentenced to 168 months in prison. The Seventh Circuit affirmed.View "United States v. Beltran" on Justia Law

Campbell worked at the Forest Preserve District’s Cermak Family Aquatic Center. In 2010, a security camera recorded him having sex with a coworker in the center’s office. Weeks later, the FPD fired him. Nearly two and a half years later, Campbell sued under 42 U.S.C. 1983 and 1981, alleging that he was denied progressive discipline in violation of his right to due process; that he was fired because of his race in violation of his right to equal protection of the law; and that his termination violated that statute’s prohibition on racial discrimination in making and enforcing contracts. Campbell later conceded that his section 1983 claims were time‐barred. The district court dismissed, finding that section 1983 provides the exclusive remedy for violations of section 1981 committed by state actors. The Seventh Circuit affirmed, rejecting arguments that under the Civil Rights Act of 1991 section 1981 provides a remedy against state actors independent of section 1983 and that if we were to allow his claim to proceed directly under section 1981, it would be timely because it would be governed by 28 U.S.C. 1658’s four‐year statute of limitations, rather than the two‐year statute of limitations governing section 1983 claims in Illinois. View "Campbell v. Forest Pres. Dist. of Cook Cnty." on Justia Law

Plaintiffs challenged Wisconsin’s campaign-finance law in light of the Supreme Court decision, Citizens United (2010), alleging that laws concerning groups that spend money for political speech independently of candidates and parties are vague and overbroad and unjustifiably burden the free-speech rights of independent political speakers in violation of the First Amendment. The Seventh Circuit previously invalidated section 11.26(4), which capped at $10,000 the aggregate annual amount a donor could give to state and local candidates, political parties, and political committees. Remaining claims challenge a ban on political spending by corporations, interlocking definitions that determine “political committee” status, “noncoordination” oath and disclaimer requirements for independent political messages, among other provisions. The district court enjoined the ban on corporate political spending, partially enjoined a regulatory disclaimer rule, and denied an injunction on other challenges. The Seventh Circuit vacated with instructions to enter a new injunction to conform to the specificity requirements of FRCP Rule 65(d). On the merits, the court stated that the First Amendment requires a heightened degree of regulatory clarity and close fit between the government’s means and its end; some forms of regulation are categorically impermissible. Wisconsin Statutes Chapter 11 has not been updated to reflect new Supreme Court doctrine; administrative rules do not cohere with the statutes and the state elections agency has given conflicting signals about its intent to enforce some provisions. Certain provisions (the ban on corporate political spending and the cap on the amount a corporation may spend to raise money for an affiliated PAC) are obviously unconstitutional under Citizens. Others fail First Amendment standards as applied to independent political speakers. Some provisions are valid. View "WI Right to Life, Inc. v. Barland" on Justia Law

Plaintiffs, employees of Antioch, participated in an employee stock ownership, plan (ESOP). In 2003, Antioch borrowed money to buy back all stock except the stock owned by the ESOP. The buy-out left Antioch bankrupt and ESOP worthless. Plaintiffs filed suit under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001, claiming breach of fiduciary duties. The district court granted the defendants summary judgments. The presumptive limitation period for violations is six years from the date of the last action constituting part of the breach or violation, but the time is shortened to three years from the time the plaintiff gained “actual knowledge of the breach or violation.” Applying the three-year limitations period, section 1113(2), the court reasoned that proxy documents given to plaintiffs at the time of the buy-out and their knowledge of Antioch’s financial affairs after the transaction gave them actual knowledge of the alleged ERISA violations. The Seventh Circuit reversed. The claims for breach of fiduciary duty do not depend only on the disclosed substantive terms of the 2003 transaction, but also depend on the processes used to evaluate, negotiate, and approve the transaction. Plaintiffs’ knowledge of the substantive terms of the buyout, therefore did not give them “actual knowledge of the breach or violation” alleged in this case. View "Fish v. Greatbanc Trust Co." on Justia Law

Ogletree ran a tax preparation service. Robtrel and Larryl provided Ogletree with birth dates and social security numbers of individuals unlikely to file tax returns; Ogletree filed false returns using that information and her Electronic Filers Identification Number. They also generated false W2 statements to support the claims. In 2006 Ogletree filed 200 fraudulent returns, seeking refunds of $834,548. The actual loss to the IRS was $652,730.In 2007, Robtrel established a tax business and obtained EFINs for new tax preparation entities. Ogletree claims she withdrew from the conspiracy and did not file fraudulent tax returns in 2007 or later. Robtrel and Larryl continued the scheme into 2008, when they were caught. Charged with conspiracy to defraud the U.S. government, 18 U.S.C. 286, and presenting a false claim against the IRS, 18 U.S.C. 287 and 2, Robtrel and Larryl pleaded guilty, but Ogletree went to trial. Her attorney did not present any witnesses, but argued that the government did not establish that Ogletree had joined the conspiracy or knowingly filed false returns, noting that the witnesses all identified Robtrel and Larryl and that no one had identified Ogletree. She was convicted and sentenced to 51 months imprisonment, the low end of the sentencing range. The Seventh Circuit affirmed her sentence, rejecting challenges to the loss calculation, to a finding that she participated in the tax fraud scheme in 2007, and that the district court did not adequately consider the section 3553 sentencing factors. View "United States v. Williams-Ogletree" on Justia Law

A psychiatrist, called 911 to report that Sutterfield had just left her office, indicating that she had received some bad news, and had remarked, “I guess I’ll go home and blow my brains out.” She informed officers that Sutterfield had worn an empty gun holster, from which she surmised that Sutterfield owned a gun. Officers were unable to locate Sutterfield. Hours later, the doctor told officers that Sutterfield had called minutes earlier stating that she did not need assistance, but did not indicate that Sutterfield no longer posed a danger to herself. Hours later, Sutterfield answered her door but would only state that she had “called off” the police. Officers concluded that they would have to enter forcibly. Sutterfield called 911. After informing Sutterfield of his intention to open the storm door forcibly, an officer yanked the door open and entered. A struggle ensued. Sutterfield can be heard on the 911 recording demanding that the officers let go of her and leave. Officers conducted a protective sweep and observed a compact disc carrying case in plain view. The soft-sided case was locked. An officer surmised from its feel and weight that there might be a firearm inside. He forced the case open and discovered a handgun and concealed-carry licenses from other jurisdictions. They also discovered a BB gun made to realistically resemble a handgun. They seized the guns and transported Sutterfield to a psychiatric hospital. Sutterfield sued under 42 U.S.C. 1983. The district court rejected the claims. The Seventh Circuit affirmed. Warrantless entry was justified by exigent circumstances; even if the officers exceeded constitutional boundaries in searching the closed container and seizing the guns, they are protected by qualified immunity.View "Sutterfield v. City of Milwaukee" on Justia Law

PepperBall is a projectile ball filled with a pepper-spray-like irritant. Police departments, private security firms, and comparable organizations are its primary consumers. Advanced Tactical brought a trademark infringement claim against Real Action and its president, Tran. The district court granted a preliminary injunction. The Seventh Circuit reversed, holding that the district court lacked personal jurisdiction over Real Action, which preserved its objection. There was no evidence that Real Action had the necessary minimum contacts with Indiana to support specific jurisdiction. View "Advanced Tactical Ordnance Sys., LLC v. Real Action Paintball, Inc." on Justia Law

The Union represents a bargaining unit at PPG’s plant. PPG informed the Union in April 2009 that it wanted to modify the collective bargaining agreement to reduce labor costs. That CBA states that a party seeking to alter the agreement must provide 30 days’ notice. The parties are required to meet in conference at least 10 days before the agreement expires. Proposed changes must be presented not later than the first day of the conference, by the party seeking modification. The parties attended an informal meeting on May 14. PPG explained that its labor costs exceeded competitors’ by $10 an hour; the parties discussed possibilities for reducing those costs. The Union requested that PPG provide details of one proposal and calculate labor-cost reductions that could be achieved without concessions from current employees. On May 28, PPG sent an e-mail with those details. The official negotiating conference began on June 1. PPG reiterated its proposal. During the next two days PPG put forward other proposals. The Union responded that it was not required to bargain about those proposals and filed a grievance. An arbitrator found some proposals timely and others untimely. PPG put forward its final offer, removing several items that had been proposed after June 1. PPG determined that the parties were at an impasse and unilaterally implemented the final offer. The Union filed suit under 29 U.S.C. 185(a). The district court granted PPG summary judgment, concluding that the arbitrator’s award did not preclude PPG from implementing the proposals. The Seventh Circuit affirmed. Neither the text of the decision nor the arbitration record supported the Union’s desired interpretation of the award. View "United Steel, Paper & Forest, Rubber, Mfg, Energy Int'l Union v. PPG Indus., Inc." on Justia Law