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The Fourth Circuit affirmed the tax court's imposition of back taxes and penalties attributable to taxpayers' use of an unlawful tax shelter. In this case, taxpayers claimed in their 2000 tax return substantial capital losses attributable to a Custom Adjustable Rate Debt Structure (CARDS) transaction. The court held that the tax court did not abuse its discretion in rejecting taxpayers' Daubert challenge; the tax court did not clearly err in finding that taxpayers' CARDS transaction failed both the subjective and objective prongs of the economic substance test; and the tax court properly found that taxpayers failed to establish reasonable cause and good faith for claiming losses based on the CARDS transaction. View "Baxter v. Commissioner" on Justia Law

Posted in: Tax Law

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Air Evac, an air ambulance company and registered air carrier, filed suit to enjoin the enforcement of various laws in West Virginia enacted to limit the reimbursement rates of air ambulance companies. The Fourth Circuit affirmed the district court's ruling in favor of Air Evac by enjoining the state from enforcing the maximum reimbursement caps and fee schedules for ambulance companies. The court held that the state's laws were preempted by the Airline Deregulation Act of 1978 (ADA), which expressly preempts state efforts to regulate the prices, routes, and services of certain air carriers. View "Air Evac EMS, Inc. v. Cheatham" on Justia Law

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The judicially mandated exhaustion requirement is a nonjurisdictional precondition to suit under section 301(a) of the Labor Management Relations Act. Plaintiff filed suit against his union and former employer under section 301 for breach of a collective bargaining agreement that governed his employment. The Fourth Circuit reversed the district court's dismissal of the action based on failure to exhaust the agreement's grievance procedures. The court held that the district court erred in treating exhaustion as a matter of jurisdiction. The court also held that the district court erred in holding that the collective bargaining agreement in fact required exhaustion. View "Staudner v. Robinson Aviation, Inc." on Justia Law

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Nursing Homes, on behalf of eleven residents, filed suit against the Secretaries, alleging that the Secretaries wrongfully denied the residents Medicaid benefits in violation of the Fourteenth Amendment and several federal statutes. The Fourth Circuit affirmed the district court's dismissal of the complaint for lack of subject matter jurisdiction and failure to state a claim. The court held that the Eleventh Amendment barred the Nursing Homes' constitutional and Medicaid Act claims for damages or other relief based on past actions; the Nursing Homes' claims for declaratory and injunctive relief were moot and required dismissal because the court lacked subject matter jurisdiction; and, because the Nursing Homes failed to state a viable Americans with Disabilities Act claim, they failed to state a cognizable Rehabilitation Act claim. View "Wicomico Nursing Home v. Padilla" on Justia Law

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The Fourth Circuit granted a petition for review of the BIA's determination that petitioner was removable under the Immigration and Nationality Act (INA) based on his commission of a crime involving moral turpitude within five years of his admission to the United States. The court explained that it was DHS's burden to affirmatively prove (by clear and convincing evidence) that petitioner last entered in 2000 without inspection, and was therefore not admitted until 2008, because this determined whether his 2012 felony abduction offense fell within the five-year window for removability. The court held that DHS failed to prove that petitioner was admitted in 2008. In this case, the record contained essentially unrebutted evidence showing that petitioner was in Peru from 1999 to 2001, and that he presented himself for inspection and was allowed to enter the United States at Reagan National Airport in 2002 (whether on a visa or otherwise). View "Mauricio-Vasquez v. Whitaker" on Justia Law

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MDENT, a Charleston drug task force, investigated Terry after an officer found remnants of drugs in trash outside of a residence associated with Terry. An MDENT agent acquired a search warrant for Terry’s residence. Agents followed Terry to a store. Once Terry had parked, Corporal Johnson approached the car and smelled marijuana. Terry turned over a small amount of marijuana. Johnson searched the car. Nothing more was found. Meanwhile, another MDENT agent surreptitiously placed a GPS tracker onto the car. No contraband or incriminating evidence was found in the residence. Afterwards, Johnson obtained a warrant to “ping” Terry’s cell phone and to place a GPS tracker on the car. Two days later, agents relied solely on the GPS data to track the car to Ohio, where they suspected Terry obtained drugs. After the car returned, the officers followed it and determined that it was speeding at five miles above the posted speed limit of 45 MPH. Officers pulled the car over. Tamara, the car’s owner, was driving. Terry was a passenger. Johnson wrote Tamara a warning citation while another officer spoke with Terry and informed Johnson that he smelled marijuana, Johnson ordered Terry out of the car and performed a pat-down. Officers discovered 195.5 grams of methamphetamine and 2.9 grams of marijuana. Although the district court found that MDENT’s conduct constituted a flagrant constitutional violation, it denied Terry’s motion to suppress on the basis of standing. The Fourth Circuit vacated. Terry had standing and the discovery of the evidence seized during the traffic stop was not sufficiently attenuated from the unlawful GPS search to purge the taint. View "United States v. Terry" on Justia Law

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Tairou was born in Benin in 1977. Although Tairou married a woman, he testified that in 2007, he “figured out [he] was a homosexual” and entered into a relationship with a man. Despite the general secrecy surrounding their relationship, the men were openly affectionate in front of Tairou’s cousin, who took pictures. Tairou was subsequently confronted by a group of approximately 40 men, including his uncles, cousins, ministers from the mosque, and other villagers. The crowd threatened and harassed him for five hours. In Tairou’s declaration attached to his asylum application, he asserted that several people said that he “should die,” and some "outright threatened to kill [him].” A week later, Tairou’s cousins forced their way into his home and beat him, threatening to “kill [him], to shame [him] publicly again,” and to harm his wife and children. Tairou’s son sustained head and arm injuries trying to protect his father. The Fourth Circuit remanded a removal order. The BIA erred in finding that Tairou was not subjected to past persecution. Binding precedent explicitly holds that a threat of death constitutes persecution. Tairou established that he was subjected to past persecution; the BIA must consider whether, in light of Tairou’s demonstrated past persecution, he has a well-founded fear of future persecution. View "Tairou v. Whitaker" on Justia Law

Posted in: Immigration Law

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In 2004, after pleading guilty to selling crack cocaine to a government informant, Lester was sentenced to almost 22 years in prison because he was designated a career offender under the then-mandatory Sentencing Guidelines. This enhancement depended on a past conviction for a “crime of violence,” Lester’s 1990 Georgia conviction for walkaway escape. In 2005, the Supreme Court stripped the Sentencing Guidelines of legal force and made them purely advisory; in 2009, the Court ruled that the generic crime of failing to report to a prison was not a crime of violence. Lester’s sentence should have been up to 11 years shorter. Lester sought habeas corpus relief. The district court denied his petition. The Fourth Circuit vacated, noting that its 2018 decision in United States v. Wheeler permits Lester’s challenge although Lester had already filed a petition under 28 U.S.C. 2255. In limited circumstances, courts, including the Fourth Circuit, allow a prisoner otherwise unable to file a second or successive section 2255 petition to seek relief under 28 U.S.C. 2241. A sentencing error “need not result in a sentence that exceeds statutory limits in order to be a fundamental defect.” Lester’s case must be considered on the merits. View "Lester v. Flournoy" on Justia Law

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In 2004-2006, Pulte purchased 540 acres of Clarksburg land, then governed by the 1994 Master Plan, which divided development into four stages. In the fourth stage, the area containing Pulte’s land was to be developed into residential communities. Pulte’s land was designated as a receiving property for Transferable Development Rights (TDRs) and was zoned for one-acre lots. Pulte could increase the allowable density to two units per acre by purchasing TDRs from agricultural properties in other Montgomery County areas, which would restrict future development of the agricultural property. Pulte invested 12 million dollars in TDRs. Under the Plan, there were prerequisites to Stage 4 development. All had occurred by 2009. The Plan stated that Stage 4 developments can proceed once public agencies and the developer have complied with all “implementing mechanisms,” which included Water and Sewer Plan amendments. Pulte submitted its Water and Sewer Request to the County and the Maryland-National Capital Park and Planning Commission in 2009, with a $10,000 filing fee. The County never acted on Pulte’s application. In 2012, Pulte submitted a Pre-Application Concept Plan to the Commission, which rejected the plan. The agencies refused to meet and stopped responding to Pulte’s communications but reopened the Plan to study the watershed in which Pulte’s land is located and ultimately imposed regulatory changes that severely reduced the number of dwellings Pulte could build and imposed additional costly burdens. The Fourth Circuit affirmed the dismissal of Pulte’s due process, equal protection, and regulatory taking claims, stating that federal courts are not the appropriate forum to challenge local land use determinations. Pulte had no constitutional property interest in developing its land as it had contemplated, and local authorities had a plausible, rational basis for their actions. View "Pulte Home Corp. v. Montgomery County" on Justia Law

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A Newport News police officer pulled over Brown’s car for a traffic violation; he smelled alcohol and observed that Brown had slurred speech. A preliminary breath test measured a blood alcohol content of approximately 0.23, over the legal limit for driving in Virginia. Officers informed Brown that he was under arrest and instructed him to put his hands behind his back. Brown attempted to flee. Officers pursued him on foot, seized and handcuffed him, then recovered a firearm that had fallen from Brown’s pants leg. Officers searched the vehicle and recovered bags containing 3.59 grams of cocaine. Brown pleaded guilty to possession of a firearm by a convicted felon, 18 U.S.C. 922(g)(1). A PSR gave Brown three criminal history points for a 2008 state conviction for possession with intent to distribute cocaine and added two points under USSG 4A1.1(d) because Brown committed the instant offense while “under a criminal justice sentence.” Brown was sentenced to 10 years’ incarceration for the 2008 conviction, with eight years and nine months suspended, conditioned on good behavior for 10 years upon release. The PSR calculated a guidelines range of 57-71 months. The Fourth Circuit affirmed a 60-month sentence, agreeing that a period of good behavior qualifies as being under a criminal justice sentence. Although Brown wasn’t under active supervision, he was subject to the authority of the state court, which could revoke the suspended sentence if Brown violated the condition. View "United States v. Brown" on Justia Law

Posted in: Criminal Law