This is a guest post by David Goodwin.
It’s a veritable law of nature, as regular and predictable as the sun rising each day. You’re at a cocktail party, chatting away, and you mention the name “Judge Anthony Scirica.” Always the same response: “Oh! General Electric Credit Corporation v. Nardulli & Sons!” Or maybe, during your weekly North Bowl league, someone spies retired Judge Timothy Lewis a few lanes down, leans over, and whispers, “Look over there! Mr. Geisinger Health Plan v. Commissioner himself . . . whoah, 215?” And who can forget learning in law school about “the legendary Learned Hand, author of Metropolitan Trust Co. v. McKinnon?”*
Among today’s opinions is a similar debut. Without further ado . . .
United States v. Ronald Damon—Criminal Law (scope of appeal waivers)—affirming—Matey
When Ronald Damon pleaded guilty, he signed a waiver of his rights to file any appeal, collateral attack, writ, or motion challenging” a within- or below-Guidelines “sentence imposed by” the court. The issue: in this context, does a request for early termination of a period of supervised release, brought under 18 U.S.C. 3583(e)(1), fall within the scope of the waiver? The District Court thought the answer was “yes,” and enforced the waiver to bar Damon’s challenge.
Writing for the Court, Judge Matey agrees. “Sentence,” Judge Matey holds, refers to “all penalties” imposed on Damon, and therefore must extend to his term of supervised release. And while Damon had argued that he was not challenging his sentence in the manner contemplated by the plea agreement, Judge Matey sees this as a distinction without a difference: a request for a modification seeks also to challenge the underlying sentence. Both parts of the analysis, I note, rely heavily on dictionary definitions.
While this decision arrives in the context of supervised release, it may plausibly extend to the more-common 3582(c)(2) discretionary sentencing challenges, too. Whether 3582(c)(2) motions fall under the ambit of broad appeal waivers is, I think, still an open question in the Circuit; Damon may shut that door.
Joining Judge Matey were Judges Jordan and Bibas. Federal Defender Julie McGrain argued for Damon and AUSA John Romano argued for the government.
Nicholas Bergamatto v. Board of Trustees of the NYSA-ILA Pension Fund—ERISA—affirming—Jordan
This complex ERISA appeal has, as its core, two main issues: 1) was the plaintiff entitled to more benefits from his plan than he received, and 2) does the Third Circuit recognize a “de facto administrator” theory, where a plan participant sues not the plan’s actual administrator, but an entity that is alleged to function as the administrator, under a statute penalizing the late provision of plan information?
On the first point, Judge Jordan rules that the deferential standard applicable to ERISA review—”arbitrary and capricious/abuse of discretion” when, as here, the plan administrator exercises discretionary authority—dooms the plaintiff’s claims. The plan language was not ambiguous, and the administrator’s decision aligned with that language.
On the second point, Judge Jordan’s opinion for the Court makes plain that the Circuit does not recognize a de-facto plan administrator theory. The plaintiff sued the Executive Director of the plan, arguing he was a “de facto” administrator and thus subject to suit under 29 U.S.C. § 1132(a)(1)(A), which is explicitly limited by § 1132(c)(1) to “administrators” who fail to comply with requests for information. As Judge Jordan notes, most other Courts of Appeals, save the 11th and 1st Circuits, have rejected the idea that someone can be liable to suit as an administrator despite not being an administrator under ERISA, and both the plain language of the statute and relevant Third Circuit precedent cut against the de facto administrator theory. “In short,” Judge Jordan writes, “we must restrict application of the title ‘administrator’ to those who fit the statutory definition and not stretch the term to authorize penalties against others whom a disappointed plan participant might like to reach.”
Joining Judge Jordan were Chief Judge Smith and Judge Matey. The case was submitted without oral argument.
Abdul Jaludi v. Citigroup—arbitration/Sarbanes-Oxley/contracts—partial reversal—C.J. Smith
Jaludi, a former Citigroup worker, allegedly blew the whistle and was laid off for his troubles. He sued under RICO (apologies to Ken White) and Sarbanes-Oxley. Citigroup moved to compel arbitration, relying on a 2009 employee Handbook with expansive arbitration clauses that explicitly encompassed Sarbanes-Oxley claims, even though Dodd-Frank amended Sarbanes-Oxley to prohbit pre-dispute agreements to arbitrate whisleblower claims (and which, in turn, led the 2011 Handbook to delete Sarbanes-Oxley from the list of arbitrable claims). The District Court held that arbitration was nevertheless required.
Chief Judge Smith’s opinion for the Court reverses in part. The “in part” here is due to the presence of the RICO claim, which did fall within both Handbooks’ arbitration provisions. Judge Smith otherwise holds that the 2011 Handbook, which eliminated Sarbanes-Oxley from the list of arbitrable claims, superseded the 2009 Handbook. Taking an opportunity to clarify the state of Circuit law on whether there is an agreement to arbitrate, Judge Smith emphasizes: “we make clear today that the question of whether a later agreement supersedes a prior arbitration agreement is tantamount to whether there is an agreement to arbitrate. It is therefore a question to which state law, not federal law, applies.” And, under Pennsylvania law, “the later of two agreements between the same parties as to the same subject matter generally supersedes the prior agreement.”
This is the same panel as the case above, so joining Chief Judge Smith are Judges Jordan and Matey.
Jaludi originally proceeded pro se. Drexel’s Federal Litigation and Appeals Clinic was appointed as pro bono counsel, with recent graduate Sydney Melillo arguing for Jaludi mere days after graduating (and, hopefully, before bar prep got too out of hand). Thomas Linthorst of Morgan Lewis argued for Citigroup.
In re: Google Inc. Cookie Placement Consumer Privacy Litigation—class actions/cy pres awards—vacating—Ambro
This is a sequel to a 2015 decision about Google’s successful manipulation of browser cookie-blocking features—”don’t be evil” indeed. On remand, the parties agreed to a settlement and moved to certify a Fed. R. Civ. P. 23(b)(2) class. The cy pres settlement, though, didn’t benefit any of the class members, and instead directed Google to cover class counsel’s fees and donate money to data privacy organizations, in exchange for which Google would obtain class-wide release.
The Ted Frank objected to the settlement, arguing that the cy pres money properly belongs to the class as compensation.
Judge Ambro’s opinion for the Court strikes a middle ground: while cy pres settlements may be appropriate for some 23(b)(2) classes, the District Court’s fairness analysis here was not sufficient. As a threshold issue, Judge Ambro concludes that the plaintiffs have standing under In re Nickelodeon Consumer Privacy Litigation, 827 F.3d 262, 273–74 (3d Cir. 2016). On the merits, the Court “see[s] no reason why a cy pres-only (b)(2) settlement that satisfies Rule 23’s certification and fairness requirements could not ‘belong’ to the class as a whole, and not to individual class members as monetary compensation.” But although the District Court here ran through the appropriate factors, Judge Ambro was “not persuaded the Court sufficiently assessed the fairness, reasonableness, and adequacy of the settlement,” and particularly the broad class-wide release of money-damages claims and the selection of specific cy pres recipients. The Court remands, warning:
The vista view of this case is not pretty. According to the complaint, an internet behemoth with unprecedented tools for monitoring private conduct told millions of Americans it would not track their personal browser history, and then it did so anyway to profit from the data. Through the proposed class-action settlement, the purported wrongdoer promises to pay a couple million dollars to class counsel and make a cy pres contribution to organizations it was already donating to otherwise (at least one of which has an affiliation with class counsel). By seeking certification under Rule 23(b)(2), the defendant and class counsel avoid the additional safeguards that apply to Rule 23(b)(3) actions. One might think this would leave room for class members to pursue damages individually; yet that relief is foreclosed as well, as the settlement contains a nationwide release of claims for money damages that arose or could arise were there unauthorized snooping, presumably covering tens if not hundreds of millions of Americans. In this context, we believe the District Court’s factfinding and legal analysis were insufficient for us to review its order certifying the class and approving the fairness, reasonableness, and adequacy of the settlement.
Joining Judge Ambro were Judge Krause and Judge Rendell. Enthusiasts of PDF-creation intrigue—I mean, who isn’t these days?—will note that this opinion, alone of the 4, does not hyperlink footnote calls to the actual corresponding footnotes.
The Ted Frank of the Competitive Enterprise Institute argued for the appellants. Brian R. Strange of Strange & Butler and Anthony Weibell of Wilson Sonsini argued for the appellees. Oramel Skinner of the Arizona AG’s office argued on behalf of a grab-bag of amicus appellant states.
*: Yes, yes, I know, this is an opinion he issued as a District Judge sitting by designation. It was legitimately hard to tell which opinion was his first for the Second Circuit proper, as Court did not distinguish between its two Hands for quite some time.