Case Summaries

Bankruptcy Law

[06/23] In re: Trout
In a bankruptcy trustee's appeal from a decision of the bankruptcy appellate panel affirming the bankruptcy court's determination that, having successfully avoided a preferential vehicle lien under 11 U.S.C. section 547, the trustee was not entitled to a money judgment equal to the value of the avoided liens under section 550(a), the order is affirmed where the bankruptcy estate had been sufficiently returned to its pre-transfer status by avoiding the preferential lien at issue and stepping into the lien priority of the avoided creditor under 11 U.S.C. section 551.

[06/23] In re McKinney
An appeal by a tax debt owner in Chapter 13 proceedings, arising from the bankruptcy court's denial of its objections to the debtor's proposed plan to pay off the tax debt with interest within five years, is dismissed for lack of jurisdiction as, although the issue that the tax debt owner cares about may have been resolved, its basic dispute with the bankruptcy estate has not been resolved and therefore the judgment of the bankruptcy court is not final.

[06/22] RLI Ins. Co. v. All Star Transp., Inc.
In an interpleader action by an insurance company to determine its obligations to pay truckers hired by its bankrupt insured under a surety bond, summary judgment for plaintiff-insurer is affirmed where Form BMC 84, which governed such bonds, plainly stated that the face value of the bond was the sum of $10,000 for all claims combined.

[06/22] In re: Delta Airlines, Inc.
In creditors' appeal from a bankruptcy court's order upholding debtor's objections to their claims under tax indemnification agreements, the order is vacated where: 1) the bankruptcy court's construction of "pay" as that term was used in an agreement at issue nullified debtor's obligation to pay the "Owner Participant" under the agreement upon the occurrence most likely to call its provisions into play ? the debtor's insolvency; and 2) the bankruptcy court effectively nullified the agreements by stripping them of their ability to protect the Owner Participant in the event of debtor's default.

[06/21] In re: Wilborn
In an interlocutory appeal from a bankruptcy court's certification of a class action in an adversary proceeding, the order is vacated where a bankruptcy judge may certify a class of debtors under appropriate circumstances but the proposed class in this case did not satisfy the requirements of Federal Rule of Civil Procedure 23 and Federal Bankruptcy Rule of Procedure 7023.

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Family Law

[06/24] Doe v. Reed
In a First Amendment case arising out of a state law extending certain benefits to same-sex couples, involving a challenge to the Washington Public Records Act based on its provision permitting the disclosure of referendum petition signers' names and addresses, the Ninth Circuit's reversal of the district court's preliminary injunction in favor of plaintiffs is affirmed where disclosure of referendum petitions does not as a general matter violate the First Amendment.

[06/23] In re Marriage of Hartman
Trial court's denial of wife's motion to vacate an order restraining her from interfering with ex-husband's child custody time is affirmed as the restraining order is neither ambiguous nor overbroad.

[06/22] In re Kyle E.
In juvenile dependency proceedings, the juvenile court's visitation order is reversed and remanded as it unlawfully delegated the responsibility of whether or not the father's visitation would occur at all to the Sacramento County Department of Health and Human Services.

[06/18] Elliot v. Carcieri
In a class action lawsuit on behalf of foster care children who are under the legal custody of Rhode Island's Department of Children, Youth and Families (DCYF), claiming that systematic deficiencies in the state's child welfare and foster care systems deprived the plaintiffs of their rights under the U.S. Constitution and several federal statutes, district court's judgment dismissing the complaint on the ground that the Next Friends lacked capacity to sue on behalf of plaintiffs is reversed where: 1) the district court erred in finding that the state appointed guardians ad litem or CASA advocates precluded plaintiffs from filing suit by a Next Friend; 2) under the circumstances of the case, Rule 17(c) allows federal courts discretion to appoint a Next Friend to represent the children in federal court; and 3) the proposed Next Friends are suited to represent the children in this case.

[06/17] Estate of Charania v. Shulman
In a tax deficiency case, the judgment of the tax court is affirmed in part and reversed in part where: 1) the tax court's judgment that all of the Citigroup shares were the separate property of the decedent for federal estate tax purposes and, thus, were includable in his gross taxable estate is affirmed, as the rule of De Nicols is that a change in marital domicile does not, in itself, effect a change in the marital property regime governing the spouses' rights in personal property acquired throughout the course of the marriage; but 2) the tax court's approbation of the late-filing penalty was in error and is therefore reversed.

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Property Law & Real Estate

[06/25] Rathborne Land Co. v. Ascent Engy., Inc.
In an action for breach of defendant's obligations to reasonably develop and explore a leased parcel of oil, gas, and mineral land, judgment for plaintiff is affirmed in part where: 1) plaintiff's letter to defendant met the La. Rev. Stat. Ann. section 31:136 demand requirement; and 2) district court did not clearly err in concluding that plaintiff would have been able to lease the disputed acreage more than once if it had been able to seismically survey the parcel prior to 2006. However, the judgment is vacated in part where neither the district court nor plaintiff could show an adequate ground -- indeed, any relevant precedent -- for awarding consequential damages for lost leasing and seismic revenues on the entire parcel.

[06/25] Greenspan v. LADT, LLC
In a trust's suit for breach of contract and other claims against two affiliated companies and individuals, trial court's confirmation of an arbitrator's award against defendants in the amount of $6.34 million is affirmed where: 1) per the JAMS rules, the arbitrator, not a court, determines what issues are arbitrable, and here, the arbitrator determined that the issue of joint and several liability was arbitrable; 2) arbitrator's finding of joint and several liability was rationally related to the parties' contract; 3) as to the timeliness of the final award under JAMS rules, the arbitrator's interpretation and application of the rules cannot be judicially reviewed on the merits; and 4) the suit against the arbitrator was barred by arbitral immunity and would not have caused a reasonable person to doubt the arbitrator's impartiality.

[06/25] St. Marks Place Hous. Co. v. US Dept. of Hous. & Urb. Dev.
In a challenge to the Department of Housing and Urban Development's (HUD) decision, contending that HUD regulations prohibited HUD from requiring prepayment approval for a housing project's federally insured mortgage, dismissal of the complaint is affirmed where there was no basis for concluding that HUD's position was plainly erroneous or inconsistent with the operative regulation.

[06/25] Flava Works, Inc. v. City of Miami
In an action challenging the Miami Code Enforcement Board's final administrative ruling that plaintiffs were engaged in "adult entertainment" in an inappropriate zone and "illegally operating a business in a residential zone," judgment for plaintiffs is reversed where the activities taking place at the residence at issue were a clear violation of the prohibition against operating a business in a residential zone.

[06/24] Kaur v. N.Y. State Urb. Dev. Corp.
In a petition for review of the Empire State Development Corporation's (ESDC) taking of plaintiffs' property by eminent domain for the purposes of constructing a new Columbia University campus, a denial of the petition is affirmed where the condemnation of petitioners' property qualified as a "land use improvement project" was rationally based and entitled to deference.

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Injury & Tort Law

[06/25] Crescent Towing & Salvage Co. v. Chios Beauty MV
In an action for damages sustained when defendant's ship collided with plaintiffs' barges and tugboats during Hurricane Katrina, partial judgment for plaintiff is affirmed in part where the district court did not clearly err in its finding of a predicted "direct hit" on New Orleans by the hurricane, its factual findings based on this finding, and the ultimate finding of negligence to the extent that it relied upon this finding. However, the matter is remanded where the district court needed to enter an order setting the total amount of recovery plaintiffs could recover in rem.

[06/25] Bagby Elevator Co. v. Schindler Elevator Corp.
In an action for tortious interference with contract, judgment for plaintiff is affirmed where: 1) under the court's highly deferential standard of review, there was no reversible error in the district court's decision to use the pattern jury instruction; 2) there was sufficient evidence of both malice and gross negligence to support an award of exemplary damages; and 3) there was ample evidence of causation to support the verdict.

[06/25] Lal v. State of Cal.
In an action against the California Highway Patrol and certain officers for the shooting death of plaintiff's husband, dismissal of the action with prejudice under Federal Rule of Civil Procedure 41(b) for failure to prosecute when her attorney failed to meet deadlines and attend hearings is reversed where an attorney's gross negligence constituted an extraordinary circumstance warranting relief from a judgment dismissing the case for failure to prosecute under Rule 41(b).

[06/24] DDJ Mgmt., LLC v. Rhone Group L.L.C.
In an action claiming that defendants presented plaintiffs with corporate financial statements that were false and misleading, the appellate division's modification of the trial court's order dismissing plaintiffs' fraud claim is reversed where: 1) when a plaintiff has taken reasonable steps to protect itself against deception, it should not be denied recovery merely because hindsight suggested that it might have been possible to detect the fraud when it occurred; and 2) plaintiffs in this action for fraud have alleged facts from which a jury could find that they were justified in relying on the representations defendants made to them.

[06/18] Wal-Mart Stores, Inc. v. Merrell
In plaintiffs' wrongful death and survival claims against Wal-Mart for the death of their son from smoke inhalation, claiming that a halogen lamp purchased from Wal-Mart caused the fire, the court of appeals' reversal of the trial court's grant of defendant's motion for summary judgment on the ground that plaintiffs produced evidence on each challenged element of their cause of action is reversed as, plaintiff's expert's testimony was legally insufficient to support causation.

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