Short Circuit: A roundup of recent federal court decisions

Objector blackmail, John Doe summonses, and inappropriate commentary from the bench.

Please enjoy the latest edition of Short Circuit, a weekly feature from the Institute for Justice.

Last week, the Supremes issued one of the most important free speech rulings in a generation, outright rejecting the "professional speech" doctrine, which invited gov't officials to silence all manner of speakers, like a concerned citizen who criticized gov't policy on traffic-light camera timing. So say IJ senior attorneys Robert McNamara and Paul Sherman. Click here to read more.

• American investors invest $221 mil into Brazilian oil project projected to produce $90 bil revenue. Yikes! Massive corruption comes to light; the $221 mil is lost. Can an American investment fund (which directed money through Luxembourg corporations for tax purposes) sue Brazil's state-run oil company in U.S. court? Sure thing, says the D.C. Circuit. Dissent: The losses, borne "by a Luxembourg entity, owned by another Luxembourg entity, in turn owned by United States entities," don't have the "direct effect" on the U.S. necessary to give us jurisdiction.
• Allegation: Uber tacked an $8.75 surcharge on customers heading to or from Boston airport, violating state law against "fictitious" fees. Uber: This should be resolved in arbitration, which our users agreed to. First Circuit: Nope—Uber didn't force customers to click on the 10-page "terms and conditions" when they signed up for the app.
• In 1961, Delaware, New Jersey, New York, and Pennsylvania enter into compact creating Delaware River Basin Commission, requiring anyone wishing to undertake a "project having a substantial effect on the water resources of the basin" to first apply for permission. The Commission has since banned fracking, but is fracking a "project"? Maybe not, says the Third Circuit; the district court should take another look.
• Honduran asylum seekers fear domestic violence at home. BIA: Which does not make them part of a "particular social group," as the statute requires, so they aren't eligible. Third Circuit: We've rejected the BIA's interpretation of what constitutes a particular social group in the past, but this is fine. Chevron deference for the BIA, and deportation for the women.
• District judge dismisses indictment after female prosecutor fails to turn over evidence to the defense, chews her out: "You're supposed to know what you're doing…. It was a lot simpler when you guys wore dark suits, white shirts and navy ties…. We didn't let girls do it in the old days." District judge also fails to cite, apply relevant case law. Fifth Circuit: The indictment should not have been dismissed, the judge's comments were "beneath the dignity of a federal judge," and a new judge needs to be assigned to the case.
• Parma, Ohio man engages in commercial sex transactions with young woman who advertises herself online as 19. Yikes! She's 14. Jury: Which he knew or should've known. Judge: So that's 17 years in prison for sex trafficking. Sixth Circuit: If you charge someone with one crime and then at trial present evidence and jury instructions that reflect a different crime, that's a problem—and our circuit has been less than clear about when it requires a new trial. But that's not a problem in this case. Conviction affirmed.
• IRS agents order bank to turn over taxpayers' financial records without naming the taxpayers (instead, agents identify account numbers)—so-called John Doe summonses, which are permissible as long as agents first obtain approval from a federal judge. Taxpayers: The agents did not get approval. Sixth Circuit: Because you're an LLC, sovereign immunity means you can't sue. You could've had you taken a different business form.
• District judge gives drug convict 10 years—double the guideline sentence and double what prosecutors asked for—because of a news article he'd just seen about an increase in opioid overdose deaths. Sixth Circuit: Yeah, no, can't do that.
• Allegation: After class action (over the claimed benefits of a dietary supplement) settles, class members who weren't part of the lawsuit object in bad faith—seeking side payment rather than better terms for the class. Objector blackmail? Maybe so, says the Seventh Circuit. The district court should take a look.
• Now-terminated Clark County, Ind. drug court jails participants for weeks and months without justification and without notice or access to counsel. Seventh Circuit: No doubt plaintiffs had their rights violated, but they can't sue the sheriff (who ran the jail) for failing to do anything about the detentions. Nor can they sue court staff who carried guns and badges, and made arrests directly without "any semblance" of legal authority.
• Allegation: Police officer orders Monticello, Ark. pedestrian to stop walking. The man continues a short way but stops when the officer points a taser at him. He walks toward the police cruiser as directed but stops and points to a nearby house saying, "You know what? That's my house right over there." The officer tases him without warning. Eighth Circuit: No qualified immunity.
• Arkansas Supreme Court justices remove judge, an anti-death penalty activist (pictured on cot), from cases related to the death penalty. A violation of the judge's free speech rights? The Eighth Circuit says no. Dissent: A writ of mandamus was not appropriate here.
• Motorist with broken taillight flees traffic stop, crashes into utility pole. Concerned for the motorist's safety, a Chico, Calif. officer approaches her car from the rear, shoots at her as she backs the car up slowly. She changes course, accelerates—into the path of other officers and potentially the public—so the officer fires twice more. The other officers fire too. She dies. District court: Qualified immunity all around. Ninth Circuit: Reversed in part. No qualified immunity for the first officer. (H/t: Police4aqi blog.)
• Santa Clara, Calif. police shoot, kill mentally ill woman who wielded a bat in her apartment. Her biological son and only living relative, who had been adopted by another family as an infant, sues the officers and the city. Ninth Circuit: Case dismissed. It's not that children "adopted out" can never file Fourteenth Amendment loss of companionship claims on behalf of their biological parents. It's that this plaintiff didn't show he had enough of a relationship with his mother.
• A Tennessee law that automatically rescinds the licenses of drivers who fail to pay court debt is unconstitutional, says a district court. "No rational creditor wants his debtor to be sidelined from productive economic life. No rational creditor wants his debtor to be less able to hold a job or cover his other, competing living expenses…. The state can still use the specter of revocation to encourage payment of court debt; it simply must afford the debtor the opportunity to demonstrate, first, that the only reason he has failed to pay is that he simply cannot."
• The end result of the U.S. Supreme Court's holdings involving motorist stops is that police have "virtually unlimited discretion to stop arbitrarily whomever they choose, arrest the driver for a minor offense that might not even be subject to jail penalties, and then obtain a broad inventory search of the vehicle—all without a warrant." So says the Iowa Supreme Court, holding the state's Constitution provides greater protections against such searches than the U.S. Constitution. (H/t: Andrew Fleischman.)
• Woman posts poor reviews ("abject lies") about personal injury lawyer on Yelp. The lawyer sues for defamation—and wins! Must Yelp, which wasn't a party to the suit, take down the reviews? The California Supreme Court, over several dissents, says no. Had the lawyer sued Yelp directly, the suit would have been tossed immediately (as Congress has immunized Internet companies that host third-party content on their sites from this kind of suit). No dice trying to achieve indirectly what Congress has clearly forbidden achieving directly.

African-style hair braiding is illegal in New Jersey without a cosmetology license, which is a sad state of affairs. The law chiefly benefits cosmetology schools (which charge upwards of $15k), provides no benefit at all to consumers, and throws up needless barriers to braiders seeking to earn a living. Fortunately, state legislators (in both the Senate and Assembly) have unanimously passed a bill exempting braiders from cosmetology licensing. Should Gov. Phil Murphy sign it, the bill would make New Jersey the 26th state to free the braiders. Click here to learn more.