Female Judges of the Sixth Circuit Court of Appeals: The Role of a HotPlate in Sixth Circuit History

By Squire Patton Boggs on Posted in News and Analysis

hotplate1.jpg   In honor of International Women’s Day 2012, marking the economic, political and social achievements of women around the world, we would like to recognize a few of the many historical achievements of the past and present female judges of the Sixth Circuit Court of Appeals.

    History was made when, in 1934, Judge Florence Allen was appointed to the Sixth Circuit Court of Appeals.  With that appointment, Judge Allen became the first female judge on any United States Court of Appeals.  No stranger to firsts, prior to joining the Sixth Circuit, Judge Allen was the first female elected to the Ohio Supreme Court (1922). In that position, she has been credited as the first woman in the world to sit on a court of last resort.

    The Court’s adjustment to the appointment was not easy and Judge Allen often ate lunch alone, heating her lunch on a hotplate while her male colleagues dined together at a restaurant that did not permit women. She bought a marble-top table so the hotplate would not burn the table, which table is storied to be passed down to the most senior female judge on the Sixth Circuit.  Currently that honor would go to Senior Judge Cornelia Kennedy who also is a female pioneer in her own right.  Judge Kennedy is the first woman to have served as a chief judge of any United States District Court.

     Boundaries continue to be broken in the Sixth Circuit as Judge Bernice Bouie Donald recently became the first African-American woman to serve on the Sixth Circuit Court of Appeals.  No newcomer to breaking boundaries, Judge Donald was also the first African-American woman elected as a judge in Tennessee, the first appointed as a federal bankruptcy judge in the nation and the first confirmed as a United States district judge in Tennessee.

 

Blue Cross Files Petition for Rehearing En Banc of Antitrust Immunity Appeal

By Squire Patton Boggs on Posted in Uncategorized

We recently reported on the Sixth Circuit’s decision to dismiss an antitrust appeal for lack of jurisdiction.  The appeal had been taken by Blue Cross/Blue Shield of Michigan in connection with an antitrust suit brought by the State of Michigan which sought to enjoin Blue Cross from using most favored nation clauses in its contracts with Michigan hospitals.  Blue Cross appealed the district court’s denial of its motion to dismiss which relied on a state action immunity defense.

At the time, we speculated that Blue Cross might seek rehearing en banc because of the significance of the case “to Blue Cross and other related insurers . . . .”  That has now come to pass.  This past Wednesday, Blue Cross filed a petition for rehearing en banc (Blue Cross Petition.pdf).  In the petition, Blue Cross’ asserts the fact that the federal circuit courts are split regarding whether a district court ruling denying a state action immunity defense in an antitrust case is immediately appealable.  The crux of Blue Cross’ argument is that the Sixth Circuit’s ruling which relied on the Sixth Circuit’s Huron Valley Hospital Inc. v. City of Pontiac decision issued in 1986 is inconsistent with subsequent rulings from other circuit courts which have held that such denials are immediately appealable. 

We will continue to provide you with updates on this case as more details continue to emerge.

Breaking News: Oral Arguments in En Banc Rehearing of Michigan Affirmative Action Case

By Colter Paulson on Posted in News and Analysis, Recent Cases

Over the past months, we have reported on developments in Coalition to Defend Affirmative Action, et al. v. Regents of the University of Michigan, et al (See here, here, here, and here). In the latest development in this Michigan affirmative action case, the Sixth Circuit held oral arguments in an en banc rehearing yesterday afternoon. 

From the atmosphere both inside and outside the courthouse, it became clear how strongly people feel about this case: Proposal 2 protestors circled the courthouse yelling and chanting; the courtroom filled to capacity nearly an hour before the oral arguments were scheduled to begin; and during oral arguments, a court employee sharply rebuked a man in the audience for clapping in favor of the appellants. 

The en banc panel was comprised of eleven active judges and Senior Judge Daughtrey, continuing her participation from the panel at the original hearing. The court first heard oral argument from the appellants, who contend that Michigan’s Proposal 2 referendum is unconstitutional under the Equal Protection Clause of the Fourteenth Amendment. Although the appellants proposed various arguments, they focused on the idea that Proposal 2 amounts to political restructuring, which is both “toxic” to the Fourteenth Amendment and precludes a “fair fight” for minorities in admissions decisions. One appellant went so far as to characterize Proposal 2 as a “gag order”. The rhetoric was intense and heated. 

The appellees’ arguments were more varied, as some of the appellees contest their position as proper parties to the suit, while others focus on the constitutional issues. The last appellee to speak was Michigan’s Solicitor General. He argued that Proposal 2 does not violate the Equal Protection Clause. The Supreme Court, according to the appellee, encouraged race-neutral policies in Grutter v. Bollinger, which have become “salutary” to minorities in admissions decisions.  He also explained that while diversity should be achieved through the admissions process, “artificial proxies” for diversity should be eliminated. Although both sides agree that Hunter v. Erickson and Washington v. Seattle Sch. Dist. No. 1 control this case, they diverge in their analyses and applications of the two cases. They also disagree as to whether Proposal 2 applies to the sex of applicants as well as their race. Appellants contend that Proposal 2 applies only to race, while the appellees argue that it applies to race, sex, ethnicity, and national origin. 

With judges also seeming to disagree on various points during oral arguments yesterday, we expect this case to be under review for the next few months. We will keep you abreast of developments as they occur.

Thanks to Lauren Henderson, a law clerk at Squire Sanders, for attending the oral argument and providing this update.

Sixth Circuit En Banc Court Currently Addressing Affirmative Action in College Admissions

By Steve Delchin on Posted in En Banc Watch

The Sixth Circuit is currently rehearing en banc the constitutionality of Michigan’s Proposal 2, which prohibits Michigan’s public colleges and universities from granting “preferential treatment to . . . any individual or group on the basis of race, sex, color, ethnicity, or national origin.”  Back in July of 2011, a divided panel of the Sixth Circuit ruled that Proposal 2 violates the equal protection clause.  The panel’s July 1, 2011 decision sparked national commentary on affirmative action, and by September 9, 2011, the Sixth Circuit had voted to rehear en banc the panel decision.

This is one of the highest profile cases that the Sixth Circuit will hear in 2012, and it is one of a handful of cases that the Court will hear en banc.  The Sixth Circuit is permitting extended oral argument in this appeal, and we’ll continue to provide you updates.

MERS Case Heads to Sixth Circuit

By Squire Patton Boggs on Posted in Uncategorized

One of the issues that has recently attracted attention (and litigation) in the wake of the global financial crisis is the use of the MERS recording system used by certain banks in connection with the securitization of mortgages.  The MERS system has been attacked by some as a way of avoiding recording fees, and in a case that was just appealed to the Sixth Circuit, county recorders have sought to reclaim those funds, Christian County Clerk v Mortgage Electronic Registration Systems, Inc. In this case, various county clerks in Kentucky filed a putative class action seeking recovery against MERS and a series of bank defendants related to the alleged lost recovery of the recording fees.  The district court made short work of the case, dismissing it because the relevant statutes under which the clerks sued did not provide a right of action for the clerks.  Despite a number of creative arguments advanced by the clerks, the court ultimately rejected each of these and concluded that the statute was not drafted for their benefit.  The clerks have now set their sights on the Sixth Circuit, which has recently been confronting a number of mortgage foreclosure cases.  We will continue to monitor the progress of this case as it works its way through the system.

Sixth Circuit Reverses Antitrust Dismissal

By Squire Patton Boggs on Posted in Recent Cases

In Carrier Corporation v. Outokumpu OYJ, Nos. 07-6052/6114 (Mar. 2, 2012)(Carrier.pdf), the Sixth Circuit reviewed the dismissal of antitrust claims which had been brought by purchasers of air-conditioning and refrigeration copper tubing.  Much of the lawsuit revolved around two decisions issued by the Commission of the European Communities (the “EC”) in 2003 and 2004, which determined that the defendants, along with other companies, participated in conspiracies to set price targets and other commercial terms “for industrial tubes, coordinated price increases, [and] allocated customers and market shares in violation of European law” and similar violations in the market for plumbing tubes.  Notably, neither of these decisions identified any conspiratorial agreements with respect to U.S. markets, focusing exclusively on the European market.

In its complaint, Carrier claimed that the conspiracy was also directed at the U.S. market for air-conditioning and refrigerator tubing, thereby violating the Sherman Act and state law.  Specifically, Carrier alleged that between 1998 and 2001, the defendants conspired to raise the price for copper tubing by developing “a customer and market allocation scheme” under which other conspirators agreed not to pursue Carrier’s U.S. business if the defendants did not aggressively pursue Carrier’s European business.  The conspiracy resulted in Carrier paying “artificially inflated and supra-competitive prices . . . .” 

In reversing the district court’s decision, the Sixth Circuit found the threshold jurisdictional requirement for the Sherman Act was met under the Supreme Court’s “effects test” because Carrier’s complaint alleged that the U.S. market was intertwined with the alleged conspiracy and the conspiracy had an effect on the U.S. market.  Similarly, the Court found that subject matter jurisdiction was met because Carrier alleged a non-conclusory effect on U.S. commerce by virtue of a world-wide conspiracy in which the U.S. market was assigned to one of the conspirators thereby causing prices in the U.S. to increase, which in turn caused a direct antitrust injury.  In making this determination, the Court appeared to look favorably on the specific factual allegations set forth in the complaint, including specific dates when the conspirators met and dates when the various agreements were entered into.

The Sixth Circuit also analyzed Carrier’s complaint under the Twombly pleading standard and emphasized that for  claims under the Sherman Act, “allegations must be specific enough to establish the relevant who, what, where, when, how or why”  and “how each defendant was involved in the alleged conspiracy.”  The court found that the allegations in the complaint, which were based in part on the two decisions issued by the Commission of the European Communities, were sufficiently specific that the complaint crossed the threshold from “conceivable to plausible.”

It is unclear what impact Carrier Corporation will have on practice in the Sixth Circuit.  The case appears to be fairly fact specific, particularly because the plaintiff had the benefit of two decisions from the EC which beefed up the specificity of the allegations in the complaint.  The implication of the Sixth Circuit’s decision, however, is that specific factual allegations are required, which should generally include specific who, what, where, when, how or why allegations – and should specify how each defendant was involved in the alleged conspiracy.  The Carrier decision follows in the wake of several notable pleadings decisions issued last year by the Sixth Circuit, and we’ll keep an eye out for how the Court (as well as the district courts) apply these various decisions.

           

 

Sixth Circuit Reverses Dismissal of Single-Issue Case, Reminding District Courts that Facts Must be Plausible- Not Persuasive- To Survive a Motion to Dismiss

By Squire Patton Boggs on Posted in News and Analysis

On Friday, the Sixth Circuit reminded district courts that the pleading requirements articulated by the Supreme Court in Iqbal and Twombly require that facts pleaded be plausible, not necessarily that they be persuasive, to survive a motion to dismiss.

In Mediacom Southeast v. BellSouth Telecommunications, Inc., Mediacom challenged AT&T’s right to offer video services over its telephone wires pursuant to a perpetual telephone franchise or whether a new cable franchise was required.  The District Court for the Western District of Kentucky granted AT&T’s motion to dismiss for failure to state a claim, finding that as a matter of law AT&T’s franchise permitted it to offer the service under the existing franchise.

The case was initiated by Kentucky cities against AT&T for a declaratory judgment that a new cable franchise was required for AT&T’s distribution of its U-Verse video service over its existing telephone lines.  The initial parties settled, entering into a settlement agreement that AT&T did not require a new franchise to provide U-Verse.  Mediacom intervened after dismissal, seeking a declaration that AT&T was required to obtain a new franchise.

On appeal, the Sixth Circuit reversed the district court, holding that only after sufficient discovery, with an adequate factual record, can the district court make such a determination. (PDF)  The Sixth Circuit found that the district court had committed two errors in granting AT&T’s motion to dismiss:  1)  improperly assigning the burden to the nonmoving party Mediacom when stating that “Mediacom’s contention that AT&T Kentucky requires a separate franchise…is unpersuasive”; and 2) relying on self-serving facts  written by AT&T in a stipulated agreement that conflicted with facts pleaded in the Complaint, i.e. whether the U-Verse transmissions are one-way or two-way transmissions.

Thus, though the sole issue may be whether the video signals fall within the scope of the existing franchise, that is an issue for summary judgment – not a motion to dismiss.  This case serves as yet another refinement of the pleading standard that the Sixth Circuit commenced in earnest last year in the wake of Twombly/Iqbal.

Still Waiting For Sixth Circuit To Rule On Free Speech Challenge To FDA’s New Tobacco Warnings As A District Court Judge In D.C. Rules That The Warnings Are Unconstitutional

By Steve Delchin on Posted in News and Analysis

Last summer, we brought you highlights from oral arguments at the Sixth Circuit in the free speech challenge to the Family Smoking Prevention and Tobacco Control Act, Public Law 111-31, which gives the Food and Drug Administration the power to regulate tobacco advertising and marketing.  See Discount Tobacco City & Lottery v. United States (6th Cir., Case Nos. 10-5234 & 5235).   The plaintiffs argued to the panel that several provisions of the Tobacco Control Act violate their First Amendment rights to free speech.  One key element of the Act is the requirement of new color warnings which graphically depict the negative health consequences of smoking.  Beginning in Fall 2012, these new warnings must occupy the top half of the front and back of all cigarette packages, and must occupy 20% of all cigarette and smokeless tobacco advertising.  The warnings, which were formally unveiled by the FDA on June 21, 2011, include graphic images of, among other things, a dead man’s body with staples lining his chest, decaying teeth, and a man breathing through a hole in his neck.

A similar lawsuit was filed in the U.S. District Court for the District of Columbia back in August 2011 by five of the country’s largest tobacco manufacturers.  On Wednesday, District Court Judge Richard Leon granted summary judgment in favor of the tobacco companies, ruling that “these mandatory graphic images violate the First Amendment by unconstitutionally compelling speech.”  See Memorandum Opinion, R.J. Reynolds Tobacco Co. v. U.S. Food and Drug Admin., Case No. 11-1482 (D.D.C.) (PDF).  Judge Leon thus permanently permanently enjoined the FDA’s final rule establishing graphic warnings for cigarette packaging and advertising.

We’re still waiting for a ruling in the Sixth Circuit case, which was argued over seven months ago.  The panel includes Sixth Circuit Judges Eric L. Clay and Jane B. Stranch, and United States District Judge Michael R. Barrett (Southern District of Ohio), sitting by designation.  It will be interesting to see whether Judge Leon’s recent opinion influences the Sixth Circuit’s decision.  We’ll, of course, give you a full report on the Sixth Circuit’s decision as soon as it is handed down.

Effective Advocacy And The Questions Posed At Oral Argument

By Colter Paulson on Posted in News and Analysis

Oral argument is important:  recent scholarship shows that a strong performance at oral argument can influence the result of an appeal.  In a recent post, we reported that we observed oral argument at the Sixth Circuit and generally found the court to be a “hot” bench. The panels we watched asked the attorneys an average of more than 30 questions per case. But we were also interested in what we could learn from the types of questions asked by the judges during oral argument.  When judges ask questions, is it usually to advance an attorney’s argument, to disagree with the argument, or to clarify a factual point of the argument?

In “The Illusion of Devil’s Advocacy:  How the Justices of the Supreme Court Foreshadow their Decisions during Oral Argument,” 6 J. App. Prac. & Process 271, 278 (2004), Sarah Shullman proposes that the frequency, substance, and tone of voice of the Supreme Court Justices’ questions can reveal the outcome of the case before a written opinion is issued. We decided to apply Shullman’s methodology to oral argument at the Sixth Circuit. Even though we will have to wait for opinions to be issued in order to fully evaluate this question, there is a lot to be learned from the questions themselves.

The questions posed by judges in our sample of 18 cases were usually either neutral or slightly aggressive. Neutral questions were directed to clear up the facts, or to review issues that had been presented before the district court. If a judge seemed to disagree strongly with an attorney’s argument, he or she would pose aggressive questions. Oftentimes, aggressive questions were presented as a string of multiple questions, with the judge interrupting the attorney to ask another question before the attorney could fully responded to the previous one. In one case, a judge became so irritated with an attorney’s argument that a second judge on the panel asked him to stop firing questions and to just listen to the attorney.  The judges also sometimes played “devil’s advocate” and asked more questions of the party whose argument they did not support.

Less frequently, judges used questions to advance their own positions before their fellow judges.  On these occasions, they would usually direct attorneys to respond to opposing counsel’s argument or begin questions by rephrasing the attorney’s argument in an attempt to better state the position. But most questions were aimed at scrutinizing bad arguments or to help the panel fully understand a particular factual issue.

Unfortunately, many attorneys stick to a pre-written script and fail to craft their arguments to the judges’ concerns.  An effective oral advocate can discern a judge’s position by paying close attention to her questions, tone of voice, and body language.  As Judge Hatchett of the Eleventh Circuit wrote:  “By looking at a judge’s body language, and listening to the questions he or she asks, an effective appellate oral advocate should be able to conform his or her argument to the judge’s viewpoint.”  Judge Hatchett notes that this skill is especially relevant for the appellee, who should be closely watching the judges’ reactions to the appellant’s argument.

Once the cases we watched are decided, we will follow up with any links between the judges’ questions, their perceived positions during oral argument, and the result of the appeal.  Thanks again to Lauren Henderson, a law clerk at Squire Sanders, for her work on this series on posts on oral argument.

Sixth Circuit Finds Personal Jurisdiction Over Out-of-State Attorney Who Drafted Letters to Individuals in Ohio

By Squire Patton Boggs on Posted in Recent Cases

The Sixth Circuit recently reversed the Southern District of Ohio and found personal jurisdiction over an out-of-state attorney in Schneider v. Hardesty, Case No. 09-3892.  Michael Hardesty, a resident of Utah, solicited David Schneider, a resident of Ohio, to participate in an investment program with London Reinsurance.  Schneider’s premium was pooled with other premiums and would be invested with Vavasseur.  However, when it became apparent that the Vavasseur was a Ponzi scheme being investigated by the SEC, the assets were frozen by a bank in Europe.  To assist with the recovery of London Reinsurance’s frozen assets, Hardesty hired Thomas Nelson, an attorney licensed to practice in Utah.  Nelson drafted two letters addressed to the individuals whose premiums were invested in London Reinsurance.  The letters introduced Nelson as an attorney “retained by Mike Hardesty . . . to assist in recovering the funds that were invested” and were drafted with Nelson’s signature block.  In one letter, Nelson summarized the efforts to recover the assets and stated that “the name, address, and contact information for each insured” had been provided to the bank to aid in return of the funds.  Both letters included statements that “every effort is being made to obtain a 100% return of your funds.”  Nelson gave the letters to Hardesty and did not mail the letters himself. 

Schneider filed a lawsuit against Hardesty and Nelson alleging that the letters were false and misleading and that he had detrimentally relied on Nelson’s representation that he was acting on behalf of the insureds.   Nelson moved to dismiss Schneider’s claims against him for lack of personal jurisdiction.   Schneider deposed Nelson on the issue of jurisdiction, but neither party requested a hearing.  While the court noted the difficulty of determining the standard to apply where discovery was taken but no hearing was had, it declined to rule on the standard because Schneider had nevertheless met the more exacting “preponderance of the evidence” standard. 

First, the Court held that Ohio’s long-arm statute had been satisfied because the letters drafted by Nelson caused “reasonably expected tortious injury” within the meaning of Ohio Rev. Code Ann. § 2307.382(A)(6).  Although Nelson claimed to have no knowledge of the locations of investors, Nelson explicitly acknowledged that he was involved in the transmission of the investors’ names and addresses to the bank in Europe.  The Court noted that it “defies logic that Nelson participated in this transmission, but remained ignorant of the investors’ geographic locations.”  The Court held that there were sufficient facts to conclude that Nelson should have reasonably expected that the letters would cause injury in Ohio. In doing so, the Court endorsed the district courts’ holdings that fraudulent communications or misrepresentations directed at Ohio residents satisfy § 2307.382(A)(6)’s requirements.

The Court then held that the Schneider’s claim of specific jurisdiction also accorded with due process.  Nelson purposefully availed himself of the benefits and burdens of Ohio when he drafted the letters knowing that Hardesty would then mail the letters to investors.  The representations in the letters showed an intent to establish an ongoing contact with the investors – the exact kind of conduct recognized by Burger King to constitute purposeful availment.  The fact that Nelson himself did not mail the letters himself did not make Nelson’s actions any less purposeful.  The dispute clearly arose from the two letters Nelson wrote and Schneider received, and the exercise of jurisdiction was not unreasonable.  The Court therefore remanded the case for further proceedings. 

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