April 29, 2013 4th Circuit published opinions

United States v Abdulwahab 

Abdulwahab was charged with securities fraud and money laundering. At the end of the government’s case, he moved to dismiss the money laundering charges. The district court denied his motion. Abdulwahab was convicted on all counts. At sentencing, he was held responsible for all investor losses and sentenced to 720 months. The panel reversed in part and remanded. It held that the money laundering convictions had to be vacated as the payment of commissions to salesmen was the payment of expenses necessary to the operation of the fraud. Thus, under circuit precedent, there was merger problem with these convictions and they had to be vacated. The panel held that Abdulwahab’s convictions for conspiracy and fraud were fully supported by the evidence and suffered no merger or other legal defects. The panel finally held that the district court did not clearly err in ruling Abdulwahab was responsible for all investor loses based on Abdulwahab’s knowledge of the misrepresentations and his personal making of misrepresentations. The case was remanded for a new sentencing.

Central Telephone of Virginia v Sprint Communications Company of Virginia, Inc. 

Sprint stopped paying access fees under access agreements with Central and other local service providers. The providers sued for payment. The district court ruled it had jurisdiction over the case and entered judgment after bench trials in favor of the providers. The district court refused to recuse itself after it discovered some shares of the providers wee in its managed retirement account. The panel affirmed. It held federal district courts have jurisdiction over disputes about the access agreements as nothing on the plain language of the 1996 telecommunications Act vests jurisdiction in any administrative body and the purposes of the act and not served by a prudential exhaustion requirement. It also held that under the safe harbor provision of the recusal statute, 28 USC 445, owning stock in a managed fund is not a financial interest in a corporate party. As the trial judge here ordered the sale of the stock upon learning of its presence in his account, there was no basis to recuse. As to the merits, on the long distance issue, the agreements were ambiguous as to whether access charges applied to voice over internet protocol calls and thus the agreement had to be construed against Sprint who wrote the agreements. Thus, Sprint was required to pay access fees. As to the local call issue, Sprint again wrote the agreement, it was ambiguous as to what method needed to be sued to identify local calls, thus, Sprint was required to pay the fees claimed by the providers.

The Country Vintner of North Carolina, LLC v E &J Gallo Winery, Inc. 

Gallo sought over $100,000 in costs for electronic discovery expenses incurred during the civil case against Country. The district court ruled 28 USC 1920(4) only allowed expenses for reducing electronic documents to uneditable form and burning them onto compact disks. It therefore awarded $218 in costs. The panel affirmed. Agreeing with the 3rd Circuit, the panel held that 1920(4) is a limited statute that only allows costs actually incurred for reproducing original works. Just as the expenses incurred in physical discovery cases are merely steps taken toward reproduction, imaging hard drives, creating search terms, running searches and so on are merely steps towards copying and are not recoverable. Nor were the electronic discovery steps “exemplification” as they did not authenticate public documents or party exhibits or demonstrative aids.

United States v Springer 

The government sought to commit Springer as a sexually dangerous offender. The district court ruled the government failed to prove its case and ordered Springer released. He was, but, during the pendency of this appeal was found to have violated his supervised release in another case and the government filed another petition to commit Springer. The panel, 2-1, affirmed. The majority held that the case was not moot as Springer would obtain release after his current term if the judgment was affirmed and because successive petitions could be field to prevent an inmate from ever getting released, the case fell into the “capable of repetition yet evading review” exception. The majority rejected the dissent’s position of mootness and vacation as this would allow the government to file successive petitions until it got the committal it wants which would implicate federal due process rights. The panel held that the district court did not clearly err in finding Springer never suffered from pedophilia based on the expert testimony and lack of a recent prepubescent victim. It noted that Springer will remain in custody until the new petition is adjudicated. The dissent argued that the case was moot as Springer was back in custody. Further, the dissent argued that the appropriate approach would be to allow the district court to evaluate the new conduct especially as the case was close as of the time of the hearing. Fearing that the majority’s decision could endanger a child by allowing Springer to molest him or her, the dissent lamented the rush to affirm.

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