Weekly Case Digests — June 23-27, 2014

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Wisconsin Law Journal’s Case Digests, June 23-27, 2014

CIVIL OPINIONS

U.S. Court of Appeals for the 7th Circuit

Civil
Energy

An energy supplier cannot shift a grossly disproportionate share of their costs to other utilities on which the projects will confer only future, speculative, and limited benefits.

“By now it should be apparent that the basic fallacy of the Commission’s analysis is to assume that the 500 kV lines that have been or will be built in PJM’s eastern region are basically for the benefit of the entire regional grid. Not true; their purpose is to address specific reliability violations in the eastern part of PJM. No electric-power company would spend billions of dollars just to improve reliability in the absence of reliability violations that required fixing. There are bound to be benefits to the entire grid and therefore to the utilities connected to it, but they are incidental, just as repairing a major pothole in a city would incidentally benefit traffic in the city’s suburbs, because some suburbanites commute to the city. So they should pay a share of the cost of repair, but a share proportionate to their use of the street with the pothole rather than proportionate to their population. The incidental-benefits tail mustn’t be allowed to wag the primary-benefits dog.”

Petitions Granted.

13–1674, 13–1676, 13–2052 & 13–2262 Illinois Commerce Commission v. FERC

Petitions for Review of an Order of the Federal Energy Regulatory Commission, Posner, J.

Wisconsin Court of Appeals

Civil
Child Abuse Injunctions — supervised visitation

Charles Walker, pro se, appeals a child abuse injunction order, challenging the sufficiency of the evidence. We affirm. This opinion will not be published.

2013AP1854 Rose v. Walker

Dist III, Price County, Fox, J., Per Curiam

Attorneys: For Appellant: Walker, Charles, pro se; For Respondent: Rose, Callisa S., pro se

U.S. Supreme Court

Civil
Securities – misrepresentation — presumption of reliance

The presumption of reliance on a misrepresentation in Basic Inc. v. Levinson, 485 U. S. 224, remains binding precedent.

Halliburton also contends that Basic rested on two premises that have been undermined by developments in economic theory. First, it argues that the Basic Court espoused “a robust view of market efficiency” that is no longer tenable in light of empirical evidence ostensibly showing that material, public information often is not quickly incorporated into stock prices. The Court in Basic acknowledged, however, the debate among economists about the efficiency of capital markets and refused to endorse “any particular theory of how quickly and completely publicly available information is reflected in market price.” 485 U. S., at 248, n. 28. The Court instead based the presumption of reliance on the fairly modest premise that “market professionals generally consider most publicly announced material statements about companies, thereby affecting stock market prices.” Id., at 247, n. 24. Moreover, in making the presumption rebuttable, Basic recognized that market efficiency is a matter of degree and accordingly made it a matter of proof. Halliburton has not identified the kind of fundamental shift in economic theory that could justify overruling a precedent on the ground that it misunderstood, or has since been overtaken by, economic realities.

718 F. 3d 423, vacated and remanded.

13-317 Halliburton Co. v. Erica P. John Fund Inc.

Roberts, C.J.; Ginsburg, J., concurring; Thomas, J., concurring.

BANKRUPTCY

U.S. Court of Appeals for the 7th Circuit

Civil
Bankruptcy — abstention

Where resolution depends on how state courts interpret state law, the federal court should have abstained pending resolution of the state law issues in state court.

“If we knew that Judge Kaplan‘s opinion rejecting Parmalat’s claim against Grant Thornton would persuade the Illinois courts, then affirming Judge Darrah would bring this litigation to a close before it had a chance to exceed the length of the Trojan War (10 years). But we can’t be certain what the Illinois courts will do. And nowhere in its 85-page brief does Grant Thornton contend that the problem illustrated by this case — the intricacies of the in pari delicto defense in corporate suits against independent auditors — arises frequently enough to justify the radical surgery that it asks us to perform on the ‘no appeal’ clause of section 1334(d). Indeed, enforcing that clause strictly may minimize overall delay in the decision of state-law cases related to bankruptcy proceedings. Had Judge Darrah, as directed by the Second Circuit, remanded the case two years ago to the Circuit Court of Cook County, the litigation might well be at an end rather than on the brim of restarting. We conclude that Judge Darrah was authorized to do naught but remand the case (actually cases, but we’ve been pretending there’s just one, for the sake of simplicity) to the Cook County court. He must do so now.”

Reversed and Remanded.

13-2245 & 13-2253 Parmalat Capital Finance Limited v. Grant Thornton International

Appeals from the United States District Court for the Northern District of Illinois, Darrah, J., Posner, J.

U.S. Court of Appeals for the 7th Circuit

Civil
Bankruptcy — judicial estoppel

A debtor’s failure to include a contingent claim, such as an employment discrimination lawsuit, can be cured by oral disclosure.

“Viewing the summary judgment record in the light reasonably most favorable to plaintiff Spaine, judicial estoppel does not apply here. Spaine’s affidavit testimony that she had disclosed her lawsuit against Community Contacts during the bankruptcy case is material. Without considering the creditors meeting transcript submitted on appeal, her testimony on this point is not even disputed. Spaine’s disclosure made the trustee aware of the litigation, and the trustee made a decision about its value to her creditors. That testimony protects Spaine from an inference on summary judgment that she deliberately concealed her claim from the bankruptcy trustee and her creditors.”

Reversed and Remanded.

13-3059 Spaine v. Community Contacts Inc.

Appeal from the United States District Court for the Northern District of Illinois, Kendall, J., Hamilton, J.

CIVIL COMMITMENT

Wisconsin Court of Appeals

Civil
Civil Commitment — involuntary medication

Jeffrey J.T. appeals an order extending his involuntary commitment. Jeffrey argues the circuit court lacked competency to extend his commitment and that the evidence was insufficient to support the court’s involuntary medication order. Affirmed. This opinion will not be published.

2013AP2481 In the matter of the mental commitment of Jeffrey J.T.

Dist IV, Portage County, Eagon, J., Sherman, J.

Attorneys: For Appellant: Breedlove, Tristan, Madison; For Respondent: Hickethier, David E., Stevens Point

Wisconsin Court of Appeals

Civil
Civil Commitment — involuntary medication

Kathleen H. appeals from an order for involuntary medication and treatment. Kathleen maintains that the County did not show that she is incompetent to refuse medication or treatment because it did not show that the advantages, disadvantages, and alternatives to her medication were explained to her, as required by Wis. Stat. § 51.61(1)(g)4. In light of Outagamie Cnty. v. Melanie L., 2013 WI 67, 349 Wis. 2d 148, 833 N.W.2d 607, we must conclude that the County did not show by clear and convincing evidence that Kathleen was incompetent to refuse medication or treatment, and we therefore reverse and remand for further proceedings not inconsistent with this opinion. This opinion will not be published.

2014AP90 In the matter of the mental commitment of Kathleen H.

Dist II, Waukesha County, Domina, J., Neubauer, P.J.

Attorneys: For Appellant: York, Katie R., Madison; For Respondent: Mueller, Robert J., Waukesha

CIVIL PROCEDURE

U.S. Court of Appeals for the 7th Circuit

Civil
Civil Procedure – standing — First Amendment

Where the district court ruled that a city violated the Establishment Clause by granting a permit, the party who sought the permit lacks standing to appeal.

“Seeking a permit, the West Side Christian Church (“West Side”) applied to the City of Evansville, Indiana, to set up its “Cross the River” display, which consisted of thirty-one, six-feet tall decorated crosses on four blocks of the City’s public Riverfront. After Evansville approved the application, residents Chris Cabral and Nancy Tarsitano filed suit against Evansville seeking an injunction to stop the display from being erected, claiming that it violated their First Amendment rights. The district court agreed and ordered the City permanently enjoined from permitting the erection of West Side’s display on the River-front. Here, the City does not appeal, but West Side, which was an intervenor in the district court action, does. We need not reach the merits of West Side’s arguments, however, because West Side does not have standing to bring the appeal. We cannot redress any injury West Side might have suffered because Evansville is not party to this appeal and could prohibit the display’s erection regardless of any order we issue. And, any First Amendment injury West Side might have suffered from the injunction was not fairly traceable to, or caused by, Evansville. Since West Side does not have standing, we dismiss the appeal.”

Dismissed.

13-2914 Cabral v. City of Evansville

Appeal from the United States District Court for the Southern District of Indiana, Barker, J., Williams, J.

U.S. Court of Appeals for the 7th Circuit

Civil
Civil Procedure — recruitment of counsel

It was an abuse of discretion for the district court not to attempt to recruit counsel for a prisoner alleging indifference to his medical needs.

“Because of his documented low IQ, functional illiteracy, poor education, inexperience with civil litigation, and incarceration, Henderson was incapable of obtaining the witnesses and evidence he needed to prevail on his claims. He offered no medical evidence in opposing the defendants’ summary judgment motion because he had none. This was fatal to his claims: the district court granted the defendants summary judgment because Henderson “put forth [no] evidence from which a reasonable jury could conclude that the treatment provided to him … was so far afield of accepted professional standards as to raise the inference that it was not based on medical judgment.” Had counsel been recruited during the discovery phase, counsel could have served discovery requests; could have deposed the defendants, probing them about their subjective knowledge of Henderson’s kidney health and the accepted standards of care; could have deposed the hospital nephrologist regarding Henderson’s medical condition and the proper treatment for kidney disease; and could have produced other evidence on the accepted standard of care, including an expert report, if necessary. Because appointed counsel could have obtained this evidence that Henderson could not, Henderson has shown prejudice.” Reversed and Remanded.

13-2035 Henderson v. Ghosh

Appeal from the United States District Court for the Northern District of Illinois, Marovich, J., Per Curiam.

U.S. Court of Appeals for the 7th Circuit

Civil
Civil Procedure — waiver

Where the defendant failed to argue protectability as a defense to a trademark infringement action in the district court, the defense is waived.

“Presumably, the court ruled on protectability in response to Door Peninsula’s brief, which marshaled both facts and law in support of its argument that ‘Hallowine’ was a protectable mark. We will not find that an argument was adequately preserved solely because a party’s opponent defended against the argument, as Door Peninsula did here. Williams v. Dieball, 724 F.3d 957, 962 (7th Cir. 2013) (‘to find that one party’s argument was preserved because his opponent defended against it out of an abundance of caution would be to punish the opponent for being more thorough.’). The party making the argument on appeal must have raised it before the district court itself, which Illinois River failed to do. Its statement of undisputed facts contained the results of Google searches for ‘Hallowine,’ and a vague assertion that ‘Hallowine’ was commonly used for fall special events. But Illinois River did not argue protectability in response to Door Peninsula’s motion for summary judgment. Arguments that are ‘underdeveloped, conclusory, or unsupported by law’ are waived on appeal. Puffer, 675 F.3d at 718. Illinois River’s argument was all three and thus was waived.”

Affirmed.

13-3786 C&N Corp. v. Kane

Appeal from the United States District Court for the Eastern District of Wisconsin, Griesbach, J., Kanne, J.

U.S. Court of Appeals for the 7th Circuit

Civil
Civil Procedure — abstention

Where the factors weigh both in favor of and against staying federal proceedings pending parallel state proceedings, it was not an abuse of discretion for the district judge to stay the proceedings.

“In sum, several factors strongly favor abstention while numerous others weigh in its favor. Freed has not presented persuasive arguments to establish why any of the factors strongly weigh against abstention. Since the factors more heavily weigh in favor of a stay, we respectfully suggest that the state court should first resolve when Freed dissociated from CLG and whether he has stated a claim for breaches of contract or fiduciary duty against Weiss before any of the derivative federal suits can go forward. Accordingly, we find that the district court did not abuse its discretion in finding that the nature and circumstances of the state and federal proceedings warranted a stay.”

Affirmed.

13-2339 & 13-2340 Freed v. J.P. Morgan Chase Bank N.A.

Appeals from the United States District Court for the Northern District of Illinois, Feinerman, J., Bauer, J.

CIVIL RIGHTS

U.S. Court of Appeals for the 7th Circuit

Civil
Civil Rights — equal protection — class of one

Summary judgment was properly granted to the defendants on plaintiff’s claim that he was denied equal protection when the state would not give him a license to operate a pawn shop.

“Saalwaechter argues that George Belt had ‘done things that a reasonable fact finder could find to be “worse” than what Fares Pawn was accused of,’ so that the decision to grant Deal Brothers’ application and deny Fares Pawn’s was irrational. This argument misses the point. It may be true that, as Saalwaechter reminds us, ‘[i]f a bad person is treated better than a good person, this is just as much an example of unequal treatment as when … a good person [is treated] worse than an equally good person.’ Esmail v. Macrane, 53 F.3d 176, 179 (7th Cir. 1995). But an applicant cannot fashion a triable class-of-one claim merely because he can locate another applicant accused of arguably ‘worse’ conduct. As with any comparator, the question is whether, given the red flags in each of their applications, DFI had a rational basis for licensing Deal Brothers and not licensing Fares Pawn. See Bell, 367 F.3d at 707. Clearly, it did—DFI believed Belt when he said that he acted in self-defense, and it either did not believe or found insufficient Saalwaechter’s explanation for the numerous causes for concern that surfaced in his own application. That is not a violation of the Equal Protection Clause.”

Affirmed.

13-3240 Fares Pawn LLC v. IDFI

Appeal from the United States District Court for the Southern District of Indiana, Young, J., Flaum, J.

U.S. Court of Appeals for the 7th Circuit

Civil
Civil Rights — attorney fees

Where the plaintiff recovered only $2,000 in damages in a civil rights action, it was not an abuse of discretion for the district court to award only $108,000 of the $400,000 attorney fee request.

“The judge did not make the mistake of limiting the fee to some multiple of the judgment, which would have been reversible error. See id. at 545. Instead, after finding that the attorneys’ expenditure of time could not be explained by the complexity of the facts or the relevant legal doctrine, or by the vindication of an important public interest, see City of Riverside v. Rivera, 477 U.S. 561, 574, 579 (1986) (plurality opinion), the judge treated the disproportionate fees as an indicator that Montanez and his attorneys unrealistically believed these claims were worth far more than they recovered. The 50% reduction was not an abuse of discretion, and the final fee award of $108,350.87 was quite ‘generous in relation to [Montanez’s] recovery.’ Richardson, 740 F.3d at 1103.”

Affirmed.

13-1692 Montanez v. Simon

Appeal from the United States District Court for the Northern District of Illinois, Finnegan, Mag. J., Sykes, J.

CONSTITUTIONAL LAW

U.S. Supreme Court

Civil
Constitutional Law — Recess Appointments Clause

For purposes of the Recess Appointments Clause, a three-day recess is too short a time to bring the recess within the scope of the clause, rendering presidential appointments during the recess invalid.

Under the standard set forth here, the Senate was in session during the pro forma sessions at issue. It said it was in session, and Senate rules make clear that the Senate retained the power to conduct business. The Senate could have conducted business simply bypassing a unanimous consent agreement. In fact, it did so; it passed a bill by unanimous consent during its pro forma session on December 23, 2011. See 2011 S. J. 924; Pub. L. 112–78. The Court will not, as the Solicitor General urges, engage in an in-depth factual appraisal of what the Senate actually did during its pro forma sessions in order to determine whether it was in recess or in session for purposes of the Recess Appointments Clause.

Because the Senate was in session during its pro forma sessions, the President made the recess appointments at issue during a 3-day recess. Three days is too short a time to bring a recess within the scope of the Clause, so the President lacked the authority to make those appointments. 705 F. 3d 490, affirmed.

12-1281 NLRB v. Noel Canning

Breyer, J.; Scalia, J., concurring.

U.S. Supreme Court

Civil
Constitutional Law — freedom of speech

A 35-foot buffer zone around abortion clinics violates the First Amendment.

The buffer zones burden substantially more speech than necessary to achieve the Commonwealth’s asserted interests. Subsection (e) of the Act already prohibits deliberate obstruction of clinic entrances. Massachusetts could also enact legislation similar to the federal Freedom of Access to Clinic Entrances Act of 1994, 18 U. S. C. §248(a)(1), which imposes criminal and civil sanctions for obstructing, intimidating, or interfering with persons obtaining or providing reproductive health services. Obstruction of clinic driveways can readily be addressed through existing local traffic ordinances. While the Commonwealth contends that individuals can inadvertently obstruct access to clinics simply by gathering in large numbers, that problem could be addressed through a law requiring crowds blocking a clinic entrance to disperse for a limited period when ordered to do so by the police. In any event, crowding appears to be a problem only at the Boston clinic, and even there, only on Saturday mornings.

708 F. 3d 1, reversed and remanded.

12-1168 McCullen v. Coakley

Roberts, C.J.; Scalia, J., concurring; Alito, J., concurring.

EMPLOYMENT

U.S. Court of Appeals for the 7th Circuit

Civil
Employment — hostile work environment

Where an employee was subjected to only one unambiguously racially hostile incident, summary judgment was properly granted to the employer on his hostile work environment claim.

“While the alleged actions Nichols faced were offensive, his case can be distinguished from the plaintiffs in Cerros II and Lambert. Cerros and Lambert were subjected to multiple racial epithets directed at them or uttered in their presence. Nichols can only point to one unambiguous incident that is of similar magnitude to that Cerros and Lambert faced. In addition, many of the other incidents that Nichols points to, such as Springfield employees not telling him where the janitor’s closet was located, allegedly making a mess for him to clean up, and baiting him to steal a purse and money from a cash register are similar to the offensive behavior in Peters that we deemed not offensive enough to avoid summary judgment. While there is no place in today’s workplace for the offensive behavior Nichols allegedly experienced, summary judgment on this claim was proper because Nichols failed to present sufficient evidence to support his hostile work environment claim.”

Affirmed.

13-2893 Nichols v. Michigan City Plant Planning Department

Appeal from the United States District Court for the Northern District of Indiana, Simon, J., Williams, J.

ENVIRONMENTAL LAW

U.S. Supreme Court

Civil
Environmental Law — Clean Air Act — carbon dioxide

The Clean Air Act neither compels nor permits EPA to adopt an interpretation of the Act requiring a carbon dioxide source to obtain a PSD or Title V permit on the sole basis of its potential greenhouse-gas emissions.

Agencies empowered to resolve statutory ambiguities must operate “within the bounds of reasonable interpretation,” Arlington v. FCC, 569 U. S. ___, ___. EPA has repeatedly acknowledged that applying the PSD and Title V permitting requirements to greenhouse gases would be inconsistent with the Act’s structure and design. A review of the relevant statutory provisions leaves no doubt that the PSD program and Title V are designed to apply to, and cannot rationally be extended beyond, a relative handful of large sources capable of shouldering heavy substantive and procedural burdens. EPA’s interpretation would also bring about an enormous and transformative expansion in EPA’s regulatory authority without clear congressional authorization. FDA v. Brown & Williamson Tobacco Corp., 529 U. S. 120, 160.

684 F. 3d 102, affirmed in part and reversed in part.

12-1146 Utility Air Regulatory Group v. EPA

Scalia, J.; Breyer, J., concurring in part, and dissenting in part; Alito, J., concurring in part, and dissenting in part.

INTELLECTUAL PROPERTY

U.S. Supreme Court

Civil
Intellectual Property – copyright — public performance

Aereo performs television stations’ works publicly within the meaning of the Transmit Clause.

The text of the Clause effectuates Congress’ intent. Under the Clause, an entity may transmit a performance through multiple transmissions, where the performance is of the same work. Thus when an entity communicates the same contemporaneously perceptible images and sounds to multiple people, it “transmit[s] . . . a performance” to them, irrespective of the number of discrete communications it makes and irrespective of whether it transmits using a single copy of the work or, as Aereo does, using an individual personal copy for each viewer.

712 F. 3d 676, reversed and remanded.

13-461 ABC v. Aereo Inc.

Breyer, J.; Scalia, J., dissenting.

LABOR AND EMPLOYMENT

U.S. Supreme Court

Civil
Employment – ERISA — pensions

ESOP fiduciaries are not entitled to any special presumption of prudence.

Rather, they are subject to the same duty of prudence that applies to ERISA fiduciaries in general, §1104(a)(1)(B), except that they need not diversify the fund’s assets, §1104(a)(2). This conclusion follows from the relevant provisions of ERISA. Section 1104(a)(1)(B) “imposes a ‘prudent person’ standard by which to measure fiduciaries’ investment decisions and disposition of assets.” Massachusetts Mut. Life Ins. Co. v. Russell, 473 U. S. 134, 143, n. 10. Section 1104(a)(1)(C) requires ERISA fiduciaries to diversify plan assets. And §1104(a)(2) establishes the extent to which those duties are loosened in the ESOP context by providing that “the diversification requirement of [§1104(a)(1)(C)] and the prudence requirement (only to the extent that it requires diversification) of [§1104(a)(1)(B)] [are] not violated by acquisition or holding of [employer stock].” Section 1104(a)(2) makes no reference to a special “presumption” in favor of ESOP fiduciaries and does not require plaintiffs to allege that the employer was, e.g., on the “brink of collapse.” It simply modifies the duties imposed by §1104(a)(1) in a precisely delineated way. Thus, aside from the fact that ESOP fiduciaries are not liable for losses that result from a failure to diversify, they are subject to the duty of prudence like other ERISA fiduciaries.

692 F. 3d 410, vacated and remanded.

12-751 Fifth Third Bancorp v. Dudenhoeffer

Breyer, J.

Wisconsin Court of Appeals

Civil
Employment — wage claims — attorney fees

American Concrete Leveling Corporation appeals the judgment and order entered after a jury found that American Concrete owed Blaine E. Goldner $31,000 for unpaid wages and that Goldner did not breach his duty of loyalty to American Concrete when he helped a competitor by going to five or six customers’ homes to give basement repair estimates because the competitor had a foot injury that prevented the competitor from doing the estimates. Post-trial, the circuit court granted Goldner’s request for lawyer’s fees and expenses, allowed under Wis. Stat. § 109.03(6), for prevailing on his wage claim, and ordered American Concrete to pay a $5,000 penalty, under Wis. Stat. § 109.11(2)(a), for not paying Goldner’s wages.[1] American Concrete challenges only the lawyer’s fees and penalty that the trial court ordered, arguing: (1) the fees should have been limited to time spent on the wage claim; (2) the fees awarded should have been reduced for what it contends was the “substantial overtrial by Goldner”; and (3) the trial court should not have ordered American Concrete to pay a $5,000 penalty. We affirm. Publication in the official reports is not recommended.

2013AP2077 Goldner v. American Concrete Leveling Corp.

Dist I, Milwaukee County, Foley, J., Fine, J.

Attorneys: For Appellant: Schulz, Leonard W., Big Bend; For Respondent: Fredrick, Kristin Posekany, Brookfield

U.S. Court of Appeals for the 7th Circuit

Civil
Employment — FMLA

An employee is entitled to summary judgment on her FMLA claim, even though she never informed her employer how much time off she needed to care for her daughter.

“Foreseeable leave is governed by 29 C.F.R. §825.302, which directs employees to tell their employers how much leave they need and adds that an employer must inquire further if an employee’s statement is inadequate. 29 C.F.R. §825.302(c). We discuss the notice system of §825.302 in Righi v. SMC Corp., 632 F.3d 404 (7th Cir. 2011). (To be more precise, Righi discusses the 2006 version. Section 825.302 and related regulations have since been amended. The 2009 version applies to Gienapp and the 2013 version to current applications. These amended regulations supersede Righi to the extent of any differences.) But Gienapp’s application is covered by §825.303, which deals with unforeseeable leave. And §825.303, unlike §825.302, does not require employees to tell employers how much leave they need, if they do not know yet themselves.”

Reversed and Remanded.

14-1053 Gienapp v. Harbor Crest

Appeal from the United States District Court for the Northern District of Illinois, Kapala, J., Easterbrook, J.

PROFESSIONAL RESPONSIBILITY

Wisconsin Supreme Court

Civil
Professional Responsibility — suspension

Where attorney Andrew J. Bryant committed 15 acts of misconduct, a four-month suspension is appropriate.

“After thoroughly reviewing the parties’ stipulation, the referee’s recommendation, and the record in this matter, we conclude that the stipulated facts demonstrate that Attorney Bryant committed all of the 15 counts of misconduct alleged in the OLR’s complaint. We determine that the requested level of discipline, a four-month suspension, is an appropriate level of discipline to impose for Attorney Bryant’s professional misconduct. While we agree with the referee that Attorney Bryant should be required to pay restitution to two former clients, we do not follow the referee’s recommendation regarding the imposition of a monitoring program. We impose other conditions on Attorney Bryant’s reinstatement that we believe will adequately ensure Attorney Bryant’s ability to practice law and conform his conduct to the Rules of Professional Conduct for Attorneys.”

2012AP484-D OLR v. Bryant

Per Curiam.

Attorneys: For Complainant: St. Ores, Sheryl A., Madison; For Respondent: Cayo, Richard J., Milwaukee; Kolb, Christopher T., Milwaukee; Bryant, Andrew J., Verona

PROPERTY

Wisconsin Court of Appeals

Civil
Property — options to purchase

This is a dispute between two banks over the relative priorities of (1) an option to purchase commercial property, held by one bank and (2) a lien created by a real estate mortgage on the same property, held by the other bank.

The option to purchase the property at issue was first created in 1986 between the property owner, Jess Levin, and the Bank of Elmwood, as part of a lease. In 2009, the lease containing Elmwood’s option to purchase was assigned by a receiver to one of the banks that is a party to this appeal, Tri City National Bank.

The real estate mortgage at issue was secured by this same property. The mortgage was executed and recorded in 2007, in connection with a loan of $1.55 million that Levin took from the other bank that is a party here, National Exchange Bank and Trust.

In 2011, Tri City executed its option to purchase the property from Levin, while Levin still owed an outstanding balance on the National Exchange mortgage note. Levin failed to produce to Tri City a fee title to the property, free of the lien created by the National Exchange mortgage. In response, Tri City initiated this litigation, seeking an order granting it clear title to the property based on its willingness to pay the price called for under the option to purchase.

The circuit court ruled for Tri City, with relief that included discharging the lien created by the National Exchange mortgage, on the grounds that the lien is an interest subordinate to Tri City’s option to purchase.

On appeal, National Exchange argues that Tri City never validly exercised its option to purchase the property from Levin. In addition, National Exchange argues that Tri City’s option is subordinate to the mortgage for the following reasons: Tri City executed the option only after National Exchange had executed and recorded the mortgage deed with Levin; the 2009 assignment by which Tri City obtained the option states that the option is subordinate to such encumbrances; the doctrine of equitable subrogation must be applied to avoid the unjust enrichment of Tri City; and, under Wis. Stat. § 706.11(1)(d) (2011-12),[1] the National Exchange mortgage “shall have priority” over Tri City’s “lien[] upon the mortgaged premises.” National Exchange also argues that the 1986 lease between Levin and Elmwood provides for the exclusive remedies available to lessee Elmwood (and now Tri City, in Elmwood’s place) in the event of a non-curable “title defect,” which the mortgage debt represents under these circumstances, and that these exclusive remedies do not include any of the remedies granted by the circuit court. We reject each of these arguments and accordingly affirm. Not recommended for publication in the official reports.

2013AP2060 Tri City National Bank v. Levin et al.

Dist II, Racine County, Jude, J., Blanchard, P.J.

Attorneys: For Appellant: Callan, Laura E., Madison; For Respondent: Long, Russell S., Milwaukee; Ambrose, Dillon, Milwaukee

Wisconsin Court of Appeals

Civil
Property — eminent domain — relocation expenses

This is a dispute about the amount of compensation The Lamar Company, LLC, d/b/a Lamar Outdoor Advertising is entitled to when the land it leased for its billboard was taken by the Department of Transportation. We reverse and remand because the circuit court’s ruling does not comport with the supreme court’s holding that relocation expenses are distinct from damages for the loss of the fair market value for the property taken. Not recommended for publication in the official reports.

2013AP2215 In re the Petition of Country Side Restaurant Inc. for the Clerk of the Circuit Court of Winnebago County to Accept a Portion of an Award of Damages Made by the DOT on 10/09/08 for Property located at 1145 Abraham Lane Oshkosh, WI

Dist II, Winnebago County, Bissett, J., Neubauer, P.J.

Attorneys: For Appellant: Hornig, Thomas S., Madison; Byron, Kraig A., Madison; For Respondent: Braun, Hugh R., Milwaukee; DiUlio, Nicholas Robert, Milwaukee

Wisconsin Court of Appeals

Civil
Property — adverse possession

Franklin Schaefer, his wife, Ardis, and their daughters brought this action to quiet title via adverse possession to a disputed strip of land between their property and that owned by Miroslav and Mira Ristic. The Ristics appeal the judgment holding that the Schaefers own the property through adverse possession and which ordered the Ristics to pay damages for vegetation they removed from the strip while litigation was pending. We affirm. This opinion will not be published.

2013AP2174 Schaefer v. Ristic

Dist II, Kenosha County, Schroeder, J., Per Curiam

Attorneys: For Appellant: Nistler, Brent D., Wauwatosa; Shepard, Joan M., Wauwatosa; For Respondent: Hartley, Thomas B., Kenosha; Hartley, Miles W., Kenosha

TORTS

Wisconsin Court of Appeals

Civil
Torts — trade name infringement

This case stems from a dispute between Ted and Carolyn Ritter, d/b/a Ritter Enterprises, (Ritters) and Tony and Arlyce Farrow, d/b/a Farrow Enterprises, (Farrows) over use of the name “Bibs Resort.” A jury found that Farrows’ use of the name “Bibs Resort” constituted a trade name, and Ritters infringed on that trade name. The circuit court entered a judgment awarding Farrows compensatory damages and $25,000 in attorney fees.

On appeal, Ritters argue the circuit court erred by denying their motion to require joinder of Bibs Resort Condominium, Inc., (the Association) and the individual condominium unit owners. Similarly, the Association argues the court erroneously denied its motion to intervene. We agree that the court erred by denying the motions for joinder and intervention. We also agree with Ritters that Farrows were not entitled to recover attorney fees on their trade name claim. We therefore reverse the judgment in favor of Farrows and the order denying the motion for intervention, and we remand for further proceedings on Farrows’ trade name claim. This opinion will not be published.

2012AP781, 2013AP927 Ritter v. Farrow et al.

Dist III, Vilas County, Stenz, J., Per Curiam

Attorneys: For Appellant: Danner, John E., Minoqua; Idlas, Jacob Allan, Minoqua; For Respondent: Levine, Jonathan B., Milwaukee; Bazelon, Adam S., Milwaukee; Sullivan, Maureen, Milwaukee

CRIMINAL OPINIONS

U.S. Supreme Court

Criminal
Bank fraud — intent

18 U.S.C. 1344(2) does not require the government to prove that a defendant intended to defraud a financial institution.

Section 1344(2) requires only that the defendant intend to obtain bank property and that this end is accomplished “by means of” a false statement. No additional requirement of intent to defraud a bank appears in the statute’s text. And imposing that requirement would prevent §1344(2) from applying to cases falling within the statute’s clear terms, such as frauds directed against a third-party custodian of bank-owned property. Loughrin’s construction would also make §1344(2) a mere subset of §1344(1), which prohibits any scheme “to defraud a financial institution.” That view is untenable because those clauses are separated by the disjunctive “or,” signaling that each is intended to have separate meaning. And to read clause (1) as fully encompassing clause (2) contravenes two related interpretive canons: that different language signals different meaning, and that no part of a statute should be superfluous.

710 F. 3d 1111, affirmed.

13-316 Loughrin v. U.S.

Kagan, J.; Scalia, J., concurring; Alito, J., concurring.

Wisconsin Court of Appeals

Criminal
Extended supervision – revocation — ineffective assistance

Juan Antonio Rodriguez, pro se, appeals from the circuit court order denying his petition for a writ of habeas corpus. Rodriguez alleged that he had received ineffective assistance of counsel at his revocation hearing. We conclude that Rodriguez has failed to demonstrate ineffectiveness of his counsel and, thus, he fails to show he is restrained contrary to the Constitution. We therefore affirm the order. This opinion shall not be published.

2013AP934 State ex rel. Rodriguez v. Rice et al.

Dist I, Milwaukee County, Murray, J., Per Curiam

Attorneys: For Appellant: Rodriguez, Juan Antonio, pro se; For Respondent: Loebel, Karen A., Milwaukee; Potter, Kevin C., Madison; Tarrant, Margaret E., Milwaukee; Remington, Christine A., Madison

Wisconsin Court of Appeals

Criminal
Return of Property — sufficiency of the evidence

Aaron C. Ols appeals from a circuit court order denying his petition for return of property pursuant to Wis. Stat. § 968.20 (2011-12). Ols seeks the return of a firearm police seized from Ols when he was arrested for disorderly conduct while armed. Because the record in this case is sparse, (the City of Milwaukee called no witnesses and Ols simply made an unsworn statement to the court), it does not provide evidence sufficient to demonstrate that the City proved by the greater weight of credible evidence that Ols used his firearm in the commission of a crime. Accordingly, because the City failed to meet its burden, we reverse. Not recommended for publication in the official reports.

2013AP1882 In re the Return of Property in State v. Ols

Dist I, Milwaukee County, Watts, J., Brennan, J.

Attorneys: For Appellant: Monroe, John R., Roswell, GA; For Respondent: Loebel, Karen A., Milwaukee; Apollo, Antoni J., Milwaukee; Sitzberger, Randy, Milwaukee

Wisconsin Court of Appeals

Criminal
Stalking — sufficiency of the evidence — jury instructions — restitution

Michel Moller appeals the judgment of conviction entered upon a jury verdict finding him guilty of stalking. Moller also appeals the circuit court’s order denying his motion for postconviction relief. Moller argues that: (1) the evidence was insufficient to prove that he was guilty of stalking beyond a reasonable doubt; (2) the jury instruction incorrectly defined the “course of conduct” element of the stalking charge; and (3) the restitution order issued by the circuit court is invalid.

We conclude that the evidence was sufficient to prove that Moller was guilty of stalking beyond a reasonable doubt. As to the jury instruction, we assume without deciding that the jury instruction incorrectly defined the “course of conduct” element of the stalking charge, but we conclude that any such error was harmless. Regarding restitution, we conclude that Moller stipulated to the restitution order. We therefore affirm the judgment of conviction and the order denying Moller’s motion for postconviction relief. This opinion will not be published.

2013AP2147-CR State v. Moller

Dist IV, Dane County, O’Brien, Markson, JJ., Per Curiam

Attorneys: For Appellant: Hanes, Ben, Menasha; For Respondent: Loebel, Karen A., Milwaukee; O’Brien, Daniel J., Madison; Ozanne, Ismael R., Madison

U.S. Court of Appeals for the 7th Circuit

Criminal
Controlled Substances — sufficiency of the evidence

The evidence was sufficient for a jury to have rationally inferred that the defendant knowingly and actively participated in the conspiracy to possess crack cocaine with intent to distribute.

“In this case, Goree admitted that he drove with Woods from St. Louis to Chicago on April 29, 2008, and May 6, 2008. Though he initially lied to an ATF agent about the purpose of their trips to Chicago, Goree eventually admitted that he and Woods were going to Chicago to purchase crack cocaine. He acknowledged that he went along to provide security and that he and Woods bought ‘a lot’ of crack cocaine on April 29, 2008, and ‘a half kilo of crack’ on May 6, 2008. Goree also volunteered that when police attempted to pull Woods over after the May 6, 2008, drug deal, he encouraged her to keep driving, and threw the crack cocaine out the window so that police would not recover it.”

Affirmed.

13-2669 U.S. v. Goree

Appeal from the United States District Court for the Northern District of Illinois, Dow, J., Bauer, J.

CRIMINAL PROCEDURE

Wisconsin Court of Appeals

Criminal
Criminal Procedure — plea withdrawal

Brian Ingle appeals the circuit court’s judgments convicting him of manufacturing methamphetamine as a party to the crime and felony bail jumping, both as a repeater. Ingle also appeals the order denying his motion for postconviction relief. He argues that he should be allowed to withdraw his pleas to the charges because he was not aware of the total maximum sentence he faced when he entered the pleas. The State does not dispute Ingle’s lack of awareness. The State argues that, under State v. Taylor, 2013 WI 34, 347 Wis. 2d 30, 829 N.W.2d 482, the circuit court correctly concluded that Ingle is not entitled to plea withdrawal because Ingle received a sentence no greater than what Ingle was advised he could receive. We agree with Ingle that Taylor does not apply here and, lacking any other apparent basis to affirm, we reverse and remand for the circuit court to allow Ingle to withdraw his pleas. This opinion will not be published.

2013AP1495-CR, 2013AP1496-CR State v. Ingle

Dist IV, Crawford County, Czajkowski, J., Per Curiam

Attorneys: For Appellant: Grunder, Steven D., Madison; For Respondent: Tarver, Sandra L., Madison; Baxter, Timothy C., Prairie du Chien

Wisconsin Court of Appeals

Criminal
Criminal Procedure — ineffective assistance

Clarence Christopher Joseph appeals an order denying his postconviction motion brought pursuant to Wis. Stat. § 974.06. Joseph argues that he received constitutionally ineffective assistance from his trial lawyer because his lawyer should have called a third-party eyewitness to testify at his trial. Joseph also argues that his lawyer should have objected to the prosecutor’s factual errors and improper argument during closing argument. We affirm. This opinion will not be published.

2013AP1703 State v. Joseph

Dist I, Milwaukee County, Borowski, J., Per Curiam

Attorneys: For Appellant: Marion, Colleen, Milwaukee; For Respondent: Loebel, Karen A., Milwaukee; O’Brien, Daniel J., Madison

U.S. Court of Appeals for the 7th Circuit

Criminal
Criminal Procedure — ineffective assistance

It was not deficient performance for an attorney not to have anticipated a change in the law.

“In this context, counsel’s failure to object to the PSR’s characterization of Groves’s 1995 burglary was not ineffective assistance of counsel under Strickland. The district court sentenced Groves in May 2007, over two years before the Woods decision and six years before Descamps. We cannot say that counsel’s performance ‘fell below an objective standard of reasonableness,’ because counsel failed to anticipate Descamps and future Seventh Circuit case law clarifying the application of § 4B1.2(a)(2).”

Affirmed.

12-3253 Groves v. U.S.

Appeal from the United States District Court for the Northern District of Indiana, Miller, J., St. Eve, J.

Wisconsin Court of Appeals

Criminal
Criminal Procedure — ineffective assistance — new trials

Bryanntton A. Brown appeals from a judgment of conviction entered after a jury found him guilty of one count of repeatedly sexually assaulting the same child and from an order denying his postconviction motion. Brown contends that: (1) he received ineffective assistance from his trial counsel; (2) the trial court erred in concluding that new evidence revealing a witness’s mental illness did not entitle Brown to a new trial; and (3) the trial court erroneously exercised its discretion at sentencing. We disagree and affirm. Not recommended for publication in the official reports.

2013AP1332-CR State v. Brown

Dist I, Milwaukee County, Dallet, J., Brennan, J.

Attorneys: For Appellant: Pray, John A., Madison; For Respondent: Loebel, Karen A., Milwaukee; Sanders, Michael C., Madison

Wisconsin Court of Appeals

Criminal
Criminal Procedure — plea withdrawal

Lynnesha L. Craig appeals the judgment convicting her of three counts of Medicaid fraud as a party to the crimes. Craig also appeals the order denying her postconviction motion to withdraw her guilty pleas. We reject Craig’s arguments and affirm the judgment and order. This opinion will not be published.

2013AP1057-CR State v. Craig

Dist I, Milwaukee County, Cimpl, J., Per Curiam

Attorneys: For Appellant: Paulson, Randall E., Milwaukee; For Respondent: Loebel, Karen A., Milwaukee; Wren, Christopher G., Madison

Wisconsin Court of Appeals

Criminal
Criminal Procedure — plea withdrawal — ineffective assistance

Jamal Desmar Williams appeals from a judgment of conviction entered upon his guilty plea to one count of armed robbery. He also appeals from a postconviction order denying his motion to withdraw his guilty plea. He claims his trial counsel gave him ineffective assistance and he entered his guilty plea involuntarily because, he alleges, his trial counsel promised that he would receive five years in prison if he pled guilty. The circuit court rejected his claims, and we affirm. This opinion will not be published.

2013AP2500-CR State v. Williams

Dist I, Milwaukee County, Hansher, Witkowiak, J., Per Curiam

Attorneys: For Appellant: Holzman, Michael S., Waukesha; For Respondent: Loebel, Karen A., Milwaukee; Remington, Christine A., Madison

Wisconsin Court of Appeals

Criminal
Criminal Procedure — ineffective assistance — prejudice

Robert Carlson appeals judgments convicting him of eight offenses relating to his stalking of G. G. He also appeals an order denying his postconviction motion in which he alleged ineffective assistance of trial counsel. He contends his counsel, Francis Rivard, asked questions that allowed the jury to learn of accusations that Carlson repeatedly beat G. G. and was investigated for sexually assaulting the victim’s daughter. Because we conclude Carlson has not established prejudice to his defense, we affirm the judgment and order. This opinion will not be published.

2013AP2065-CR State v. Carlson

Dist III, Eau Claire County, Schumacher, J., Per Curiam

Attorneys: For Appellant: Brehm, Philip J., Janesville; For Respondent: Balistreri, Thomas J., Madison; King, Gary M., Eau Claire

Wisconsin Court of Appeals

Criminal
Criminal Procedure — breach of plea agreement — ineffective assistance

Kyle Perz appeals judgments convicting him of four counts of sexual assault of a child, repeated sexual assault of a child, two counts of possession of THC and bail jumping. He also appeals an order denying his postconviction motion in which he alleged the State violated the terms of the plea agreement by “subtly suggesting that the facts justified a longer sentence.” Because Perz’s trial counsel did not object to the assistant district attorney’s statements, the alleged breach of the plea agreement must be reviewed under ineffective assistance of trial counsel rubric. To establish ineffective assistance of counsel, Perz must show deficient performance and prejudice to his defense. We conclude that counsel’s performance was not deficient for failing to object to the prosecutor’s remarks because the remarks did not violate the plea agreement. This opinion will not be published.

2013AP1930-CR, 2013AP1931-CR, 2013AP1932-CR, 2013AP1933-CR State v. Perz

Dist III, Brown County, Hammer, J., Per Curiam

Attorneys: For Appellant: Kachinsky, Leonard D., Appleton; For Respondent: Wellman, Sally L., Madison; Lasee, David L., Green Bay

EVIDENCE

Wisconsin Court of Appeals

Criminal
Evidence – relevance — hearsay

William E. Akins appeals a judgment of conviction entered after a jury found him guilty of first-degree reckless homicide by use of a dangerous weapon. He contends that the circuit court erred by: (1) limiting his cross-examination of a witness; and (2) barring admission of a text message as evidence on hearsay grounds. We affirm. This opinion will not be published.

2013AP447-CR State v. Akins

Dist I, Milwaukee County, Dallet, J., Per Curiam

Attorneys: For Appellant: Loeb, Basil M., Milwaukee; For Respondent: Loebel, Karen A., Milwaukee; Lloyd, Katherine Desmond, Madison

OWI

Wisconsin Court of Appeals

Criminal
Motor Vehicles — operating with detectable amount of controlled substances — due process

Even though the government destroyed the sole evidence of the defendant’s guilt prior to notice, charging, or a meaningful opportunity for the accused to inspect the State’s evidence, the defendant’s due process rights were not violated.

“Weissinger was able to cross-examine persons in the chain of custody as well as persons involved in the testing of her blood sample. Additionally, the trial court allowed Weissinger to examine the State’s witnesses regarding the destruction of the blood sample. Thus, the only difference between this case and Disch and Ehlen is that in those cases the defendants were arrested and advised of their ability to obtain further tests. See WIS. STAT. § 343.305(2)-(4). Weissinger was not under arrest, and thus the officer was under no obligation to advise her regarding additional tests. That factual difference does not compel a different result here. Youngblood, Greenwold I, and Greenwold II establish the test we must apply to determine whether there has been a due process violation by the destruction of evidence. Weissinger has not shown that the destroyed test was apparently exculpatory or that the test was destroyed in bad faith.” Affirmed.

Recommended for publication in the official reports.

2013AP218-CR State v. Weissinger

Dist. II, Ozaukee County, Williams, J., Neubauer, J.

Attorneys: For Appellant: Boyle, Gerald P., Milwaukee; Boyle, Bridget E., Milwaukee; For Respondent: Gerol, Adam Y., Port Washington

SEARCH AND SEIZURE

Wisconsin Court of Appeals

Criminal
Search and Seizure — warrantless searches — exigent circumstances

Ronald Sallmann appeals a judgment convicting him of second-degree recklessly endangering safety and aggravated battery/intent to cause bodily harm. He contends that his arrest should have been quashed and evidence suppressed because the arrest and search were carried out without a warrant. As exigent circumstances justified the warrantless arrest, we affirm. This opinion will not be published.

2013AP1711-CR State v. Sallmann

Dist II, Waukesha County, Foster, J., Per Curiam

Attorneys: For Appellant: George, Gary R., Milwaukee; For Respondent: Schimel, Brad, Waukesha; Wittwer, Jacob J., Madison

U.S. Supreme Court

Criminal
Search and Seizure — warrantless searches — cell phones

The police generally may not, without a warrant, search digital information on a cell phone seized from an individual who has been arrested.

Cell phones differ in both a quantitative and a qualitativesense from other objects that might be carried on an arrestee’s person. Notably, modern cell phones have an immense storage capacity. Before cell phones, a search of a person was limited by physical realities and generally constituted only a narrow intrusion on privacy. But cell phones can store millions of pages of text, thousands of pictures, or hundreds of videos. This has several interrelated privacy consequences. First, a cell phone collects in one place many distinct types of information that reveal much more in combination than any isolated record. Second, the phone’s capacity allows even just one type of information to convey far more than previously possible. Third, data on the phone can date back for years. In addition, an element of pervasiveness characterizes cell phones but not physical records. A decade ago officers might have occasionally stumbled across a highly personal item such as a diary, but today many of the more than 90% of American adults who own cell phones keep on their person a digital record of nearly every aspect of their lives. 13–132, reversed and remanded; No. 13–212, 728 F. 3d 1, affirmed.

13-132 Riley v. California

Roberts, C.J.; Alito, J., concurring.

SENTENCING

U.S. Court of Appeals for the 7th Circuit

Criminal
Sentencing — supervised release

Where the defendant’s only sex-related offense occurred 15 years earlier, it was error to impose sex offender treatment as a condition of supervised release.

“After a jury convicted him of distributing three grams of crack cocaine and being a felon in possession of a firearm, Montarico Johnson received a 210-month sentence. He appeals on several grounds. The government had exercised peremptory challenges against two female prospective jurors, but Johnson failed to show a prima facie case of discrimination in jury selection on the basis of gender so the court did not need to evaluate the reasons for the government’s strikes. As for his sentence, which was largely driven by his career offender status, we find that the district court understood Johnson’s request for a below-guidelines sentence but rejected it in light of Johnson’s criminal history, and we affirm his prison term. The special condition of supervised release requiring that Johnson participate in a sex offender treatment program is another story, however. Johnson’s only sex-related offense came fifteen years earlier when he received a misdemeanor conviction and a probation-only sentence because, at the age of seven-teen, he had sex with a girl over thirteen and less than seventeen years old. Guided in part by decisions we made after the sentencing in this case took place, we conclude that the record does not support a connection between mandatory sex-offender treatment and the 18 U.S.C. § 3553(a) factors. We therefore vacate this condition of supervised release, as well as other conditions not mentioned in the oral pronouncement of sentence. In all other respects we affirm.”

Affirmed in part, and Vacated in part.

12-3229 U.S. v. Johnson

Appeal from the United States District Court for the Southern District of Illinois, Gilbert, J., Williams, J.

Wisconsin Court of Appeals

Criminal
Sentencing — accurate information

Robert Close appeals a judgment of conviction for aggravated battery with a dangerous weapon and an order denying his post-conviction motion for resentencing. Close argues he was sentenced based on inaccurate information in violation of his due process rights. We reject Close’s arguments and affirm. This opinion will not be published.

2013AP1161 State v. Close

Dist III, Pierce County, Duvall, J., Per Curiam

Attorneys: For Appellant: Fernandez Close, Robert D., pro se; For Respondent: Moeller, Marguerite M., Madison; Froelich, Sean E., Ellsworth

Wisconsin Court of Appeals

Criminal
Sentencing — accurate information

Kevin Lavare Spight, Sr., pro se, appeals an order denying his postconviction motion brought pursuant to Wis. Stat. § 974.06. Spight argues that his due process rights were violated because the circuit court sentenced him on the basis of inaccurate information. We affirm. This opinion will not be published.

2013AP1148 State v. Spight

Dist I, Milwaukee County, DiMotto, J., Per Curiam

Attorneys: For Appellant: Spight, Kevin Levare, Sr., pro se; For Respondent: Loebel, Karen A., Milwaukee; Larson, Sara Lynn, Madison

U.S. Court of Appeals for the 7th Circuit

Criminal
Sentencing — supervised release — conditions

A supervised release condition that a defendant convicted of extortion not be self-employed was not supported by the evidence.

“The district court gave some brief explanation for the self-employment ban, first raising its own concern about Farmer’s spotty employment and tax payment history, and then adopting the government’s suggestion of a self-employment ban, raised for the first time at the hearing. See Transcript of Plea and Sentencing and Competency Hearing, United States v. Farmer, No. 4:12-cr-00026 (S.D. Ind. Nov. 14, 2013), ECF No. 84, 54–55 (discussing Farmer’s self-employment over the past ten years), 57–59 (discussing with the parties, then imposing, a prohibition on self-employment, on the basis that Farmer ‘hasn’t paid anything into Social Security other than $1,200’ and that the requirement that he ‘start working and get[] a paycheck and pay[] taxes and become a good citizen’ may rid Farmer of ‘that temptation to con people’). However, the district court’s ex-planation did not provide the necessary nexus between Farmer’s underlying crime — attempted extortion — and the self-employment ban. The district court did not determine that Farmer’s activities as a self-employed entrepreneur caused him to attempt to extort Walter Allen. The court’s explanation focused instead on its belief that Farmer’s lack of success as an entrepreneur was causing him to turn to con activities to fund himself: perhaps not an incorrect conjecture, but one that is insufficient to meet the requirement that the occupation being restricted or banned ‘bear a reasonably direct relationship’ to the ‘conduct relevant to the offense of conviction.’ U.S.S.G. § 5F.15(a); cf. United States v. Wittig, 528 F.3d 1280, 1288 (10th Cir. 2008) (reasoning, on the basis of the relevant statute and guidelines, that a court that did not explain how the occupational restriction related to the offense of conviction had erred, and that ‘[t]he mere fact [Defendant] engaged in such conduct while employed as an executive does not establish the necessary connection between the conduct and his management/executive positions’). The court also noted Farmer’s spotty tax payment history, stating: ‘He hasn’t paid anything into Social Security other than $1,200. He’s 48 years old. He’s going to have nothing paid in as he becomes a senior citizen.’ But Farmer’s offense of conviction is extortion rather than a tax offense. Farmer’s age and status with regard to Social Security seem irrelevant to whether there was a ‘reasonably direct relationship’ between his extortionate activities and his self-employment.

Vacated and Remanded.

13-3373 U.S. v. Farmer

Appeal from the United States District Court for the Southern District of Indiana, Pratt, J., Tinder, J.