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

Hernandez filed a voluntary Chapter 7 bankruptcy petition in December 2016, reporting one sizable asset: a pending workers’ compensation claim valued at $31,000. To place that claim beyond the reach of creditors, she listed it as exempt under section 21 of the Illinois Workers’ Compensation Act, 820 ILCS 305/21, applicable via 11 U.S.C. 522(b). Two days after filing for bankruptcy, Hernandez settled the claim. Hernandez owed significant sums to three healthcare providers who treated her work-related injuries. The providers objected to her claimed exemption, arguing that 2005 amendments to the Illinois Act enable unpaid healthcare providers to reach workers’ compensation awards and settlements. The bankruptcy court denied the exemption and the district judge affirmed. The Seventh Circuit certified to the Illinois Supreme Court the question: Whether the Illinois Workers’ Compensation Act, as amended, allows care-provider creditors to reach the proceeds of workers’ compensation claims. The court noted that Section 21 has been interpreted by bankruptcy courts to create an exemption for these assets; 2005 amendments imposed a new fee schedule and billing procedure for care providers seeking remuneration. The Illinois Supreme Court has not addressed the interplay between these competing components of state workers’ compensation law. View "Hernandez v. Marque Medicos Fullerton, LLC" on Justia Law

Herrera-Garcia, a citizen of El Salvador, entered the U.S. illegally in 1990. In 2016, DHS initiated removal proceedings under 8 U.S.C. 1229a, alleging that he was convicted of a crime of moral turpitude. Herrera-Garcia sought asylum, withholding of removal, and relief under the Convention Against Torture, testifying that when he was nine years old, guerrillas stopped him about every three weeks to get information about neighbors who might be working for the military; he never saw the guerillas with guns. Herrera-Garcia also testified that several of his friends were forced to join the military and that his fear of living in El Salvador is worse today than it was 27 years ago because of the number of gangs and kidnappings there. His parents testified that they worry about El Salvadoran gangs kidnapping him for ransom given his American accent. The IJ found Herrera-Garcia removable and denied his applications for relief; the BIA affirmed. He unsuccessfully sought reconsideration, citing a new Supreme Court decision, Pereira v. Sessions. Pereira held that a notice to appear that fails to specify the time or place of a removal hearing does not trigger the “stop-time rule” for purposes of cancellation of removal. Herrera-Garcia argued that Pereira should be extended outside the context of the stop-time rule to preclude the agency’s jurisdiction over his proceedings. The Seventh Circuit denied his petition. Herrera-Garcia provided no evidence of past torture or persecution and did not show that he, specifically, would be in danger in El Salvador or that the government would have inflicted or allowed torture. View "Herrera-Garcia v. Barr" on Justia Law

Kanter pleaded guilty to mail fraud, 18 U.S.C. 1341, based on his submission of bills to Medicare for non-compliant therapeutic shoes and shoe inserts. Due to his felony conviction, he is prohibited from possessing a firearm under both federal and Wisconsin law, 18 U.S.C. 922(g)(1) and Wis. Stat. 941.29(1m). He challenged those felon dispossession statutes under the Second Amendment, as applied to nonviolent offenders. The Seventh Circuit affirmed judgment upholding the laws. Even if felons are entitled to Second Amendment protection, so that Kanter could bring an as-applied challenge, the government met its burden of establishing that the felon dispossession statutes are substantially related to an important government interest in preventing gun violence. Congress and the Wisconsin legislature are entitled to categorically disqualify all felons—even nonviolent felons like Kanter—because both have found that such individuals are more likely to abuse firearms. The “bright line categorical approach … allows for uniform application and ease of administration.” View "Kanter v. Barr" on Justia Law

Freedom From Religion Foundation (FFRF), a nonprofit organization, “[t]akes legal action challenging entanglement of religion and government, government endorsement or promotion of religion.” FFRF paid its co-presidents a portion of their salaries in the form of a housing allowance, seeking to challenge 26 U.S.C. 107, which provides: In the case of a minister of the gospel, gross income does not include— (1) the rental value of a home furnished to him as part of his compensation; or (2) the rental allowance paid to him as part of his compensation, to the extent used by him to rent or provide a home. Having unsuccessfully sought refunds from the IRS based on section 107 they sued. The district court granted FFRF and its employees summary judgment, finding that the statute violates the Establishment Clause of the First Amendment. The Seventh Circuit reversed, applying the “Lemon” test. The law has secular purposes: it is one of many per se rules that provide a tax exemption to employees with work-related housing requirements; it is intended to avoid discrimination against certain religions in favor of others and to avoid excessive entanglement with religion by preventing the IRS from conducting intrusive inquiries into how religious organizations use their facilities. Providing a tax exemption does not “connote[] sponsorship, financial support, and active involvement of the [government] in religious activity.” FFRF offered no evidence that provisions like section 107(2) were historically viewed as an establishment of religion. View "Gaylor v. Peecher" on Justia Law

Chicago makes a car’s owner, rather than its driver, liable for many fines, including those for speeding, running a red light, and illegal parking. After their Chapter 13 bankruptcy payment plans were confirmed, the seven debtors incurred, and failed to pay, at least 72 fines aggregating almost $12,000. The debtors argued that a Chapter 13 plan does not provide for the payment of post-petition fines and that the automatic stay of 11 U.S.C. 362 prevented their cars from being towed or booted. The bankruptcy court ordered that the vehicles were the property of the estate for the duration of the payment plan. Reversing the order, the Seventh Circuit noted that the holding could be seen as permission to violate traffic laws with the fines never to be paid. The court noted that, while a Chapter 13 petition transfers most of the debtor’s assets to the bankruptcy estate, upon the confirmation of a payment plan, 11 U.S.C. 1327(b) presumptively returns that property to the debtor, who becomes personally responsible for the expenses of maintaining the property. The bankruptcy court gave no explanation for departing from that scheme. View "City of Chicago v. Marshall" on Justia Law

Kreg, a medical-supply company, contracted with VitalGo, maker of the Total Lift Bed®, for exclusive distribution rights in several markets. A year and a half later, the arrangement soured. VitalGo told Kreg that it had not made the minimum‐purchase commitments required by the contract for Kreg to keep its exclusivity. Kreg thought VitalGo was wrong on the facts and the contract’s requirements. The district court ruled, on summary‐judgment that VitalGo breached the agreement. The damages issue went to a bench trial, despite a last-minute request from VitalGo to have it dismissed on pleading grounds. The court ordered VitalGo to pay Kreg about $1,000,000 in lost‐asset damages and prejudgment interest. The Seventh Circuit affirmed, upholding the district court’s rulings that the agreement allowed Kreg to make minimum-purchase commitments orally; that the minimum‐purchase commitment for the original territories was made in December 2010; that VitalGo breached the agreement by terminating exclusivity in June 2011 and by failing to deliver beds in September 2011; and concerning the foreseeability of damages. View "Kreg Therapeutics, Inc. v. VitalGo, Inc." on Justia Law

Indiana University and faculty members, claiming interference with medical scholarship, challenged a state statute, providing that “[a] person who intentionally acquires, receives, sells, or transfers fetal tissue commits unlawful transfer of fetal tissue, a Level 5 felony,” Ind. Code 35‐46‐5‐1.5(d). A federal district court held that several terms in the statute were unconstitutionally vague and that it must be treated as if it read: “A person who intentionally sells fetal tissue commits unlawful transfer of fetal tissue, a Level 5 felony.” The definitional clause, as enacted, read: “As used in this section, ‘fetal tissue’ includes tissue, organs, or any other part of an aborted fetus.” The court held it must be treated as if it read: “As used in this section, ‘fetal tissue’ includes tissue or organs of an aborted fetus.” The Seventh Circuit reversed. A federal judge cannot definitively interpret Indiana statutes but the state judiciary can do so in a declaratory judgment suit. Instead of using an available state‐law remedy, the plaintiffs asked a federal court to invalidate the law. The statute survives an equal‐protection challenge under a rational basis test. The law regulates conduct, not speech and does not discriminate against interstate commerce. A Takings Clause claim is confined to the University but the University, as part of Indiana, is not entitled to sue the state. View "Trustees of Indiana University v. Curry" on Justia Law

Illinois law requires sex offenders to register with the police. Offenders with a fixed residence were required to register either every 90 days or annually; homeless offenders were to report weekly. Some Chicago officers thought the weekly requirement was burdensome and “steered” offenders to identify a residence. Officers directed Regains to a homeless shelter, which they listed as his permanent address, and to return for re-registration in 90 days. When he reported three months later, Regains was arrested on an “investigative alert,” because other officers had not been able to locate Regains at the address provided. Regains remained in custody 17 months before the Illinois trial court found him not guilty of failing to a report a change of address. Regains sued the city under 42 U.S.C. 1983. The district court dismissed the claim as time-barred under Illinois’ two-year statute of limitations for personal injury claims and found that the amended complaint lacked sufficient factual details to give fair notice. The Seventh Circuit reversed, concluding that the claim accrued when Regains was released from custody. The court remanded, noting that it will be difficult for Regains to amend his complaint to allege a policy or practice, widespread enough to constitute a custom and that high-ranking Department members knew of the differing practices and allowed them to continue. View "Regains v. Chicago" on Justia Law

Walker was charged with possessing a firearm as a convicted felon. During his detention awaiting trial, the government discovered that Walker and his associates had bribed witnesses to testify falsely on his behalf at his upcoming trial. The grand jury returned a superseding indictment, adding one count charging Walker with conspiring to obstruct justice. He pleaded guilty to both counts of the superseding indictment. The district court imposed sentences of 80 months’ imprisonment for each count, to be served concurrently, plus three years of supervised release. The district court recommended to the Bureau of Prisons (BOP) that Walker should not receive credit for time served before the date the superseding indictment was filed, because of his conduct leading to the addition of the obstruction of justice charge. The Seventh Circuit affirmed, rejecting arguments that the district court improperly left to the BOP the calculation of credit for his time served before trial and that he should receive credit for all the time he spent in custody between his arrest and the superseding indictment. Congress has committed the responsibility for the calculation of credit for pretrial confinement to the BOP; the court has the discretion to make a recommendation as to whether pretrial credit is appropriate. View "United States v. Walker" on Justia Law

Surviving Mustang fighter planes are collectors’ items. In 1965 Vartanian bought a Mustang, serial number 44-74543 and kept it in a Fulton County New York hangar. In 1985 Vartanian's representative could not find it. Vartanian suspected Martin, who had promised to restore the plane. Vartanian’s lawyer unsuccessfully demanded that Martin return the plane. Vartanian complained to the FAA, the FBI, and local police. Martin denied taking Vartanian’s plane. Martin later registered with the FAA a Mustang, serial number 44-63655. Martin asserts that it was cobbled together using parts from a plane that crashed in Nicaragua plus components acquired from several sources. In 1998 Martin sold 44-63655 to Greenhill. Vartanian learned about this transaction in 2002 or 2003 by reading a magazine article that incorrectly identified it as 44-74543. Vartanian hired another lawyer, who died before filing suit. Vartanian did not follow up until after learning in 2013 that there were irregularities in the serial numbers of several of Martin’s planes. Vartanian demanded that Greenhill return the plane. Greenhill sought a declaratory judgment of ownership. Vartanian filed counterclaims. The Seventh Circuit affirmed that the counterclaims were untimely and that the aircraft is free of Vartanian's claim. Although federal law provides the registration system, state law supplies the rules for determining ownership, 49 U.S.C. 44108(c)(1). For conversion claims, Illinois law establishes a five-year limitations period that starts when the injured party “knows or reasonably should know” of the injury and its cause. Vartanian knew in 1985 that his Mustang had vanished; he suspected Martin immediately and knew long ago what serial number Martin was using. Even if Illinois would not apply a statute of limitations, the doctrine of laches would remain. View "Greenhill v. Vartanian" on Justia Law