Short Circuit: A roundup of recent federal court decisions

(Here is the latest edition of the Institute for Justice's weekly Short Circuit newsletter, written by John Ross.)

All across the land, officials are spending enormous sums of public money on fanciful real-estate schemes, subsidies for companies that relocate from one locality to another, sports stadiums, and much more. We advocate a different approach to economic development: freeing entrepreneurs from initiative-strangling red tape. In a new report, IJ Senior Attorney Paul Sherman identifies seven common restrictions that cities could strip from their codes at little to no cost resulting in a boon to entrepreneurs. Click here to read it.

• D.C. Circuit: An SBA program that bolsters business owners' chances of securing government contracts if they have faced racial prejudice or are otherwise socially disadvantaged is not an unconstitutional racial classification. Dissent: Individuals are presumed to be disadvantaged or not depending on their race. Which is a racial classification.
• Allegation: Kindergarten teacher releases student into care of stranger who failed to produce the requisite ID. The stranger sexually assaults the student. Teacher: There's no constitutional violation, and, even if there were, I'm entitled to qualified immunity. Third Circuit: Wrong and wrong.
• The feds are prosecuting New Jersey officials who allegedly closed lanes on the George Washington Bridge, causing substantial travel delays, in retaliation for a local mayor's refusal to endorse Gov. Chris Christie. Can a variety of media outlets force disclosure of discovery material naming an unindicted co-conspirator who has not been publicly identified? That would be inappropriate, says the Third Circuit.
• Rehoboth Beach, Del. voters narrowly approve measure to borrow funds for public project. Allegation: Officials gave some voters (owners of multiple properties) more than one vote, used taxpayer funds to urge residents to "Vote Yes." Third Circuit (over a dissent): Plaintiff, a voter and taxpayer, lacks standing to bring suit.
• Federal law generally bars anyone convicted of a crime with a max sentence of over a year from possessing a gun. Plaintiffs: We committed nonviolent, misdemeanor crimes decades ago and were not jailed. Third Circuit (sitting en banc): As applied to these plaintiffs, the ban violates the Second Amendment. Dissent: Plaintiffs' proper source of redress is their states' legislatures—not the courts. They should (have had to) lobby legislators to lessen the penalties for their crimes.
• As staff prepare to discharge her for third time in two days, woman miscarries at Catholic hospital in Muskegon, Mich. Can she sue Catholic organization that instructs member hospitals not to terminate a pregnancy unless the fetus's heartbeat stops on its own, a directive that allegedly led to the poor care she received? Sixth Circuit: No.
• Richland County, Ohio nursing-home aide, a 23-year-old single mom, convicted of participating in drug buy. Yikes! She's innocent; an informant framed her with help from DEA agent. Can she sue county sheriff's officers who surveilled the buy and used a sixth-grade photo to identify her? Nope, says the Sixth Circuit. Dissent: A jury could reasonably conclude the officers should have known she, a blonde, was not the brunette at the buy.
• Because Wisconsin man is unable to find housing that complies with state and local restrictions on sex offenders, officials keep him in jail for 54 weeks after his mandatory release date. Seventh Circuit: Officials are entitled to qualified immunity. Dissent: Local parole agents surely are, but policymaking officials should have known continued custody without court authorization violates the Constitution.
• In which the Seventh Circuit upbraids the gov't for its 23-year, Javert-like effort to deport immigrant over minor crime (of the sort the gov't purports to no longer prioritize). But the law is the law, so the man may very well be sent back to Iraq, which has changed somewhat since he left as a teenager in 1979.
• Minneapolis municipal water pipes burst and flood condos. City officials only compensate uninsured property owners. Insurance company sues. Is this a taking? Eighth Circuit: We'll not address that because plaintiff used the wrong writ in state court.
• Woman alleges Woodbury, Minn. man assaulted her. Prosecutors file a criminal complaint against him. Yikes! The prosecutors (private attorneys working under contract with the city) are also representing the woman in her civil case arising from the incident. State court: Criminal complaint dismissed. Eighth Circuit: The prosecutors are entitled to absolute immunity, but the city, which lacked a conflict-of-interest policy, is not.
• In 1982, 18-year-old pleads guilty to sleeping with 14-year-old, gets four years of probation. The following year, Arizona legislators create sex-offender registry. He does not register and in 2010 is sentenced to over three years in prison. Ninth Circuit: The law is more regulatory in nature than punitive, so its retroactivity does not offend the Constitution.
• Federal agents wiretap drug suspect's phone, overhear incriminating talk. But wait! Their suspect wasn't using the phone and had no connection to the fellow who was. Ninth Circuit: Once agents realized the fellow using the phone was not part of their suspect's conspiracy, they should have stopped listening.
• Allegation: Toxic mold at Clark County, Nev. health office contributed to employee's death. Can his survivors sue his supervisors, who knew about the mold and his ill health? The supervisors could have been deliberately indifferent toward the danger, but nonetheless are entitled to qualified immunity, says a divided Ninth Circuit panel. They weren't on notice that the "state-created danger" doctrine could apply to physical dangers in the workplace.
• Jury awards man $50k for beating at the hands of Vallejo, Calif. police officer. Cities typically pay such awards for their officers, but Vallejo is bankrupt. Must the officer cough up the money himself? Just so, says the Ninth Circuit.
• Low-cost airline springs last-minute fee on customers after they've selected their flight (but before purchase is made). Plaintiffs: It's unconscionable. And it's also mail and wire fraud, which, among other things, give rise to a Racketeer Influenced and Corrupt Organizations Act claim. Eleventh Circuit: Nope.
• And in en banc news, the Ninth Circuit will not reconsider its holding allowing the DOL to regulate "tip pooling" sans express statutory authority, prompting dissenters to wonder if they've "spun out of the known legal universe and are now orbiting alone in some cold, dark corner of a far-off galaxy, where no one can hear the scream 'separation of powers.'"

Last month, California legislators passed a sterling civil-forfeiture reform bill by a wide margin (69-7 in the Assembly and 39-0 in the Senate). To curb policing for profit, SB 443 would require a criminal conviction before agencies could receive equitable-sharing payments from the federal government on forfeited real estate, vehicles, boats, and cash valued at under $40k and raise the threshold to forfeit seized cash under state law from $25k to $40k. All the bill needs now is the governor's signature. Click here to learn more.