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

The case involves Continental Indemnity Company (Continental) and its attempt to collect a default judgment against BII, Inc. (BII) from Starr Indemnity & Liability Company (Starr), BII's insurer. Continental had paid a workers' compensation claim for an employee injured at a construction site where BII was a subcontractor. Continental then sought reimbursement from BII, which had failed to maintain its own workers' compensation insurance. When BII did not pay, Continental secured a default judgment against BII and sought to collect from Starr under Illinois garnishment procedures.The district court in the Northern District of Illinois dismissed the garnishment proceeding against Starr, finding that it lacked subject matter jurisdiction. The court reasoned that the dispute over the scope of coverage under the Starr-BII insurance policy was too distinct from the underlying suit between Continental and BII. Continental appealed this decision to the United States Court of Appeals for the Seventh Circuit.The Seventh Circuit affirmed the district court's decision. The court found that the garnishment proceeding introduced new factual and legal issues, making it essentially a new lawsuit. The court explained that while federal courts have ancillary enforcement jurisdiction to consider proceedings related to an underlying suit, the subject of those proceedings must still be sufficiently related to the facts and legal issues of the original action. In this case, the court found that the garnishment proceeding fell outside the scope of ancillary enforcement jurisdiction. The court suggested that Continental could file a new civil action against Starr to litigate the dispute over the insurance policy's coverage. View "Continental Indemnity Company v. BII, Inc." on Justia Law

The case revolves around a dispute over the estate of Dr. Lester Frank Sumrall, who founded a church that grew into a global evangelical empire, LeSEA, Inc. After his death, his son and grandson, Lester Sumrall, claimed they should have inherited part of his estate, including copyrights to his works and his right of publicity. They alleged that LeSEA, now controlled by other family members, had wrongfully taken ownership of these assets.The case was initially heard in the United States District Court for the Northern District of Indiana. The district court dismissed the claims brought by Lester Sumrall and the Lester Sumrall Family Trust against LeSEA and its affiliates, ruling in favor of LeSEA on all counts. The court found that the copyright claims were untimely and that LeSEA owned the copyright to a particular photograph, the "Traveler Photo," taken by Lester Sumrall. The court also dismissed various state law claims for damages under the doctrine of laches, citing inexcusable delay in asserting rights and prejudice to the adverse party.Upon appeal, the United States Court of Appeals for the Seventh Circuit affirmed the district court's decision. The appellate court agreed that the copyright claims were untimely and that LeSEA owned the copyright to the Traveler Photo. The court also upheld the application of laches to the state law claims, noting that laches is equally applicable in suits at law in Indiana. Finally, the court dismissed the claim for LeSEA's alleged use of Dr. Sumrall's right of publicity, as the Trust failed to plead the required half-ownership. View "Sumrall v. LeSEA, Inc." on Justia Law

Marcos Mendez was stopped for inspection at O'Hare International Airport after returning from a trip abroad. Customs agents, who had been alerted to Mendez due to his arrest record and travel history, searched his cell phone and found child pornography. Mendez was subsequently indicted on multiple counts related to child pornography. He moved to suppress the evidence found on his phone, arguing that the search violated his Fourth Amendment rights as it was conducted without a warrant, probable cause, or reasonable suspicion.The district court denied Mendez's motion to suppress the evidence, ruling that the search did not violate the Fourth Amendment as customs agents had reasonable suspicion to look through Mendez's phone. Mendez pleaded guilty to one count of producing child pornography but preserved his right to appeal the district court's ruling on the suppression motion.In the United States Court of Appeals for the Seventh Circuit, Mendez argued that the Supreme Court's decisions in Riley v. California and Carpenter v. United States required a warrant, probable cause, or at least reasonable suspicion for the searches of his phone. The Court of Appeals disagreed, noting that searches at borders do not require a warrant or probable cause. The court held that the routine, manual search of Mendez's phone required no individualized suspicion. The court affirmed the district court's decision, joining the uniform view of other circuits that searches of electronics at the border do not require a warrant or probable cause. View "United States v. Mendez" on Justia Law

Kevin Shibilski was charged with environmental and wire-fraud crimes and conspiracy to defraud the United States, related to his operation of three Wisconsin-based companies involved in recycling electronic equipment. Shibilski pleaded guilty to a single felony count of willful failure to pay employment taxes, and in exchange, the government dropped the other charges. During the sentencing hearing, Shibilski objected to the presentence report’s recommendations regarding relevant conduct under the Sentencing Guidelines, particularly the recommendation to hold him responsible for the total amount of unpaid employment taxes for all three companies. The district judge held a seven-hour sentencing hearing, most of which was consumed by the presentation of documents and testimony, including testimony from Shibilski himself.The district judge found Shibilski responsible for the full amount of unpaid taxes. The judge also declined to award credit for acceptance of responsibility under U.S.S.G. § 3E1.1(a), finding that Shibilski had falsely denied responsibility for relevant conduct. After weighing the statutory sentencing factors, the judge imposed a sentence of 33 months in prison, the bottom of the advisory Guidelines range.Shibilski appealed to the United States Court of Appeals for the Seventh Circuit, arguing that the judge violated Rule 32(i)(4)(A)(i) of the Federal Rules of Criminal Procedure by unduly curtailing his attorney’s presentation of evidence, that the judge improperly denied credit for acceptance of responsibility under § 3E1.1(a), and that the judge committed procedural error by failing to meaningfully address the statutory sentencing factors. The Court of Appeals rejected these arguments and affirmed the district court's decision. View "United States v. Shibilski" on Justia Law

The case involves Taiwo Onamuti, who was charged with 23 crimes related to his involvement in a tax-fraud scheme. He pleaded guilty to one count each of identity theft, aggravated identity theft, and presenting false claims for tax refunds. After several changes in defense counsel and an unsuccessful motion to withdraw the guilty plea, Onamuti was sentenced to 204 months in prison. Later, Onamuti moved to vacate his convictions under 28 U.S.C. § 2255, arguing that his attorney had been ineffective for failing to move to dismiss the charge and for advising him to plead guilty. The judge vacated the aggravated identity theft conviction, reduced Onamuti’s prison sentence by 24 months, and denied all other relief.Onamuti filed a motion in his criminal case seeking attorney’s fees under the Hyde Amendment for the legal expenses he had incurred to fight the charges of aggravated identity theft. He argued that the government had pursued those charges vexatiously and in bad faith. The government objected on procedural grounds, arguing that the Hyde Amendment does not apply in a § 2255 proceeding. The judge denied the motion for fees, concluding that the motion was procedurally deficient.On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the lower court's decision. The court held that Onamuti did not show that the government’s position was frivolous, vexatious, or in bad faith. The court also held that the civil deadline applies to a motion for attorney’s fees under the Hyde Amendment because it is a civil matter ancillary to the criminal case. Therefore, Onamuti was not entitled to an award of attorney fees under the Hyde Amendment. View "United States v. Onamuti" on Justia Law

The case revolves around a former coal miner, Richard McLain, who developed a serious lung condition after working underground for nearly two decades. McLain filed a claim under the Black Lung Benefits Act, alleging that his years of mine work had left him totally disabled from a pulmonary perspective. His former employer, Old Ben Coal Company, had been liquidated through bankruptcy, so Liberty Mutual Insurance Company, the surety guaranteeing Old Ben’s debts under the Act, contested liability on the coal company’s behalf.The case was initially heard by an administrative law judge (ALJ), who determined that McLain was disabled within the meaning of the Black Lung Benefits Act. The ALJ's decision was based on a thorough review of the medical record and a set of medical findings regarding how to distinguish between lung disorders arising from coal dust and those arising from tobacco smoke. Old Ben appealed the ALJ’s decision to the Benefits Review Board, arguing that the ALJ erroneously treated the 2001 preamble as if it were binding law and made factual findings unsupported by the medical record. The Review Board affirmed the benefits decision in full.The case was then brought before the United States Court of Appeals for the Seventh Circuit. The court affirmed the decision of the Benefits Review Board, emphasizing the broad discretion ALJs enjoy when evaluating competing medical theories, the weight ALJs may properly attribute to the perspective of the Department of Labor on such issues, and the significant deference owed to ALJs’ medical findings and scientific judgments on appeal. The court found no error in the ALJ's application of a regulatory preamble or in the factual findings that were challenged by Old Ben. View "Safeco Insurance/Liberty Mutual Surety v. OWCP" on Justia Law

The case revolves around Gerald Sewell, who responded to a post on Craigslist, seeking a sexual encounter. The post was made by an undercover FBI agent posing as a 15-year-old girl. The conversation between Sewell and the agent quickly turned sexual, with plans to meet later the same day. Sewell drove from Missouri to Illinois to meet the supposed minor, only to be arrested upon arrival.Sewell was indicted for attempted enticement of a minor and for traveling across state lines with intent to engage in illicit sexual conduct. He pleaded not guilty and requested a jury instruction on entrapment. The district court denied this request, finding no evidence of persistent persuasion by the undercover agent or reluctance by Sewell. The court concluded that the government had used the sting operation to solicit the crime without inducing Sewell. Sewell was convicted on both counts and sentenced to concurrent ten-year sentences.In the United States Court of Appeals for the Seventh Circuit, Sewell appealed the district court's denial of an entrapment instruction. The court, after reviewing the case, found no evidence of inducement, only solicitation of the crime, which is insufficient to put the entrapment defense before the jury. The court noted that it was Sewell who encouraged the supposed minor to meet for a sexual rendezvous, and he set aside any misgivings he may have had to drive across state lines to meet her. The court concluded that the government had furnished Sewell the ordinary opportunity to commit the charged crime, and he eagerly took it. The court affirmed the district court's decision, denying Sewell's requested entrapment instruction. View "USA v. Sewell" on Justia Law

The case revolves around Echo Scheidt, who was convicted for knowingly providing false information on a Firearms Transaction Record (ATF Form 4473) during five separate gun purchases. Scheidt resold the firearms, two of which were later used in shootings, including a murder. The false statements pertained to her residential address, which she misrepresented in the forms. The authorities traced the firearms back to her after the shootings.The district court indicted Scheidt on five counts of knowingly making a false written statement likely to deceive a firearms dealer, in violation of 18 U.S.C. § 922(a)(6), and one count of knowingly making a false statement to a government agent, in violation of 18 U.S.C. § 1001(a). Scheidt moved to dismiss the five § 922(a)(6) counts, arguing that the statute criminalized conduct protected by the Second Amendment. The district court denied the motion, stating that the conduct prohibited by § 922(a)(6) does not enjoy Second Amendment protection. Scheidt pleaded guilty to all counts and was sentenced to 18 months' imprisonment.In the United States Court of Appeals for the Seventh Circuit, Scheidt appealed her conviction, arguing that § 922(a)(6) violates the Second Amendment. She contended that her right to purchase a firearm was conditioned on completing ATF Form 4473 and that § 922(a)(6) further conditioned her right to possess a firearm by demanding honesty. However, the court disagreed, stating that ordinary information-providing requirements, like those imposed by ATF Form 4473 and enforced through criminal statutes like § 922(a)(6), do not infringe the right to keep and bear arms. The court affirmed her conviction, concluding that the Second Amendment does not immunize purchasers from knowingly providing misstatements in ATF Form 4473. View "USA v. Scheidt" on Justia Law

Jan Kowalski, an attorney, was accused of using her position to hide her brother's assets during his bankruptcy proceedings. She allegedly concealed around $357,000 in her attorney trust account and made false statements under oath to cover up the concealment. Kowalski was charged with four counts of bankruptcy fraud and one count of concealing assets from the bankruptcy trustee. She pleaded guilty to the charge of concealing assets.Prior to her trial, Kowalski had been involved in her brother's bankruptcy proceedings, where she used her attorney trust account to hide her brother's assets from his creditors and the bankruptcy trustee. She also made false statements under oath and fabricated documents to cover up her actions. The bankruptcy trustee confronted Kowalski with inconsistencies between her personal bank records and her earlier testimony, but she continued to lie under oath.Kowalski was sentenced to 37 months' imprisonment by the United States District Court for the Northern District of Illinois, Eastern Division. The court applied two sentencing enhancements: the § 2B1.1(b)(10)(C) sophisticated-means enhancement, and the § 3B1.3 abuse of position of trust enhancement. Kowalski appealed her sentence, arguing that the district court erred in applying these enhancements and that her sentence was substantively unreasonable.The United States Court of Appeals for the Seventh Circuit affirmed the district court's decision. The court found that Kowalski had indeed used sophisticated means to commit the offense and had abused her position of trust. The court also found her sentence to be substantively reasonable. View "United States v. Kowalski" on Justia Law

The case involves Patrick Hancock, who pleaded guilty to unlawful possession of a firearm as a convicted felon. His federal sentence was enhanced on the grounds that he also violated Indiana Code § 35-44.1-2-6, which makes it a felony for a civilian to impersonate a law enforcement officer. Hancock appealed his sentence, challenging the Sentencing Guidelines enhancement. The evidence supported the district court’s findings that Hancock represented himself as a police officer by wearing various law enforcement paraphernalia.The district court applied a four-level sentencing enhancement, finding that Hancock's attire was sufficient to prove by a preponderance of the evidence that § 2K2.1(b)(6)(B) applied. The court sentenced Hancock to 48 months in prison to be followed by three years of supervised release. The district court varied upward from the Sentencing Guidelines range because it found that Hancock’s crime involved “extreme conduct” and that greater punishment was needed to deter future criminal conduct.In the United States Court of Appeals For the Seventh Circuit, the court affirmed the district court’s decision. The court rejected Hancock’s argument that he did not intend to deceive anyone at Costco into thinking he was a law enforcement officer. The court also rejected Hancock’s argument that Indiana’s false impersonation statute violates the First Amendment. The court held that the statute was narrowly tailored to serve the government’s compelling public interest in preserving public safety and protecting the reputation of law enforcement. View "USA v. Hancock" on Justia Law