Justia U.S. 4th Circuit Court of Appeals Opinion Summaries

In 2015, Towers Watson & Co. (“Towers Watson”), a Delaware company headquartered in Virginia, purchased directors and officers (“D&O”) liability insurance coverage from several insurance companies, including National Union Fire Insurance Company of Pittsburgh, Pa. (“National Union”) as the primary insurer. Following Towers Watson’s merger with another company, Towers Watson shareholders filed several lawsuits against Towers Watson’s chairman and CEO and others, alleging that the shareholders received below-market consideration for their shares in the merger. The litigation was settled, and Towers Watson sought indemnity coverage from its insurers under the relevant D&O policies. The insurers refused the indemnity request, citing a so-called “bump-up” exclusion in the policies. This declaratory judgment action followed. The district court sided with Towers Watson and held that the bump-up exclusion “does not unambiguously” preclude indemnity coverage for the underlying settlements.   The Fourth Circuit vacated the district court’s judgment and remanded for further proceedings. Under Virginia law, it will not do to merely identify any conceivable basis to hold that an insurance-coverage exclusion does not apply before stripping the exclusion of all force. Rather, the language of the exclusion must reasonably lend itself to an “equally possible” interpretation precluding the exclusion’s applicability. Here, however, the district court’s chosen interpretation, which disregarded the Policy’s plain language and inserted terms not included by the parties, cannot be characterized as one of two “equally possible” constructions. View "Towers Watson & Co. v. National Union Fire Insurance Company" on Justia Law

A criminal complaint was filed against Appellant. On May 20, 2009, a certificate of mental disease or defect and dangerousness issued pursuant to 18 U.S.C. Section 4246. Appellant’s mental condition improved with treatment. The district court ordered his conditional discharge. Appellant returned home and lived with his mother after conditional discharge. The district court revoked the term and recommitted him. This appeal presents two consequential questions. Both relate to the continued involuntary commitment of those afflicted with a mental illness. A commitment wrongly perpetuated is an unwarranted restraint of liberty; a commitment errantly discontinued poses a danger to the committee and the public.   The Fourth Circuit vacated the district court’s order and remanded for further proceedings. The court explained that the record is unclear whether the district court’s findings were made by a preponderance of the evidence. It also appears from the record that the district court collapsed both inquiries of Section 4246(f) into a single question, focusing only on whether Appellant violated the conditions of his release and not explaining why “in light of” those violations his continued release created a substantial risk to other persons or property. Additionally, the record would benefit from further development respecting the violations alleged and the available, recent records from the facility. Further, the court wrote that the government should take note of its evidentiary burden, develop evidence on the point, and provide the district court a sound basis for making reasoned findings on the matter of dangerousness for that particular alleged violation. View "US v. Christopher Perkins" on Justia Law

Plaintiffs, residents of West Virginia, formerly owned Demcorp, LLC, which did business as “Dollar Stretcher,” a convenience store in nearby Winchester, Virginia. That store sold large quantities of cigarettes, which law enforcement agents of the Department of Homeland Security had evidence to believe was being resold in New York to avoid New York’s higher excise taxes, in violation of the Contraband Cigarette Trafficking Act. During their criminal investigation, agents, armed with warrants, seized 1,560 cartons of cigarettes from the Dollar Stretcher store, and the Department of Homeland Security then held them for several years, during which time the cigarettes passed their shelf life of one year. When the Department ultimately offered to return the cigarettes, Plaintiff refused them as they could no longer be sold and thus had no value. Plaintiffs commenced this action against the Department of Homeland Security and the United States under the Federal Tort Claims Act, seeking compensatory damages. The district court dismissed the complaint for lack of subject matter jurisdiction.   The Fourth Circuit affirmed. The court explained that the criminal warrant served a range of obvious and stated criminal investigative purposes. Any damages action against the United States for the improper seizure and detention under such a warrant is barred by sovereign immunity. Even though the seizure of cigarettes, in this case, was authorized by both a warrant issued for criminal investigative purposes and a warrant issued for civil forfeiture — dual purposes — the court concluded that the United States is immune from suit. View "Reba Myers v. Alejandro Mayorkas" on Justia Law

Defendant was originally charged with four federal offenses: (1) carjacking; (2) kidnapping; (3) using a firearm during a crime of violence; and (4) possessing a firearm after being convicted of a felony. The parties agreed Defendant would plead guilty to the kidnapping and Section 924(c) charges, and the government would dismiss the carjacking and felon in possession charges. Neither the indictment nor the plea agreement specified a predicate “crime of violence” for the Section 924(c) charge, and the plea agreement contained no agreed-upon factual statement. Defendant filed a pro se motion to vacate his Section 924(c) conviction based on intervening authority. The district court denied Defendant’s motion. The court acknowledged it is now clear “kidnapping is not a Section 924(c) predicate offense.” But the court concluded Defendant’s Section 924(c) conviction remained valid because.   The Fourth Circuit reversed the district court’s denial of Defendant’s motion to vacate his firearm conviction and remanded him for resentencing. The court explained that the categorical approach does not deny the district court its ultimate discretion, nor does it deprive the facts of their force. Even if a statutory enhancement under Section 924(c) does not apply because of the categorical approach, as is the case here, judges may, at their discretion, calculate a guidelines range or grant upward variances based on the violent nature of the criminal activity. Even if the categorical approach renders violent predicates legally invalid, district courts are at liberty to sentence the violent character of the cases that come before them. View "US v. Elliott Graham" on Justia Law

After pleading guilty to possession of a firearm by a felon, Defendant was sentenced to 15 years imprisonment, an enhanced penalty that represents the mandatory minimum sentence required for such a violation when the provisions of the Armed Career Criminal Act (“ACCA”) are satisfied. ACCA provides that when a defendant violates Section 922(g) and has “three previous convictions . . . for a violent felony or a serious drug offense . . . committed on occasions different from one another,” he shall be given the enhanced sentence. Defendant’s indictment did not allege the facts supporting the ACCA enhancement; instead, the district court found them as part of the sentencing procedure. Defendant maintained that, in light of Supreme Court cases and the Fifth and Sixth Amendments, ACCA’s requirement that the defendant has committed the prior offenses on different occasions must be alleged in the indictment and found by a jury or admitted by the defendant in his guilty plea because that fact increases the penalty for his crime.   The Fourth Circuit affirmed. The court concluded that the ACCA enhancement remains a matter for sentencing. Under Almendarez-Torres v. United States, 523 U.S. 224 (1998), the facts that support a recidivism enhancement are resolved by the district court during sentencing, and ACCA provides just such a recidivism enhancement, as the court recognized in Thompson. Despite Defendant’s arguments to the contrary, the court concluded that the Supreme Court’s decisions in Descamps, Mathis, and Wooden have not narrowed or overruled Almendarez-Torres. And if they have done so by implication, the Supreme Court must say so, not a court of appeals. View "US v. Rico Brown" on Justia Law

Plaintiff Moses Enterprises, LLC, sells cars. Moses had an insurance policy issued by defendant Lexington Insurance Company, with Defendant AIG Claims, Inc. serving as the claims administrator. Moses sued Lexington and AIG in federal district court. The complaint made four claims under West Virginia law, including—as relevant here—one for breach of the insurance contract and one for violating the State’s unfair trade practices statute. The district court granted partial summary judgment for Moses on the breach of contract claim but resolved only liability—not damages.   The Fourth Circuit vacated the district court’s judgment and remanded. The court explained that the district court’s later grant of partial summary judgment also did not obviate the need for further work to “obtain payment of the insurance proceeds.” However, at the same time the court rejected Moses’s contention that the district court committed no legal errors in concluding Moses was entitled to “the entire amount of attorney’s fees incurred until the final resolution of the case.” Thus, the court wrote because the district court committed legal error in awarding Moses the full amount of its requested fees without determining whether any of the work was properly attributed only to the Jenkins claim, the court vacated the fee award and remand for further proceedings View "Moses Enterprises, LLC v. Lexington Insurance Company" on Justia Law

While working for Adnet, Inc. (“Adnet”), Defendants learned of a subcontract that Adnet was attempting to win. Thereafter, Defendants, through their own company, submitted a bid for that same subcontract. After Defendants won the subcontract, Adnet brought claims against them for breach of the duty of loyalty, tortious interference with a business relationship, and business conspiracy. The district court granted Defendants’ motion for summary judgment, concluding that Defendants did not compete against Adnet, that Adnet did not have a business expectancy in the subcontract, and that, without proof of an underlying tort, there was no business conspiracy. Adnet appealed.   The Fourth Circuit reversed the district court’s grant of summary judgment to Defendants on Adnet’s claims for breach of the duty of loyalty and tortious interference with a business relationship. Further, the court vacated the district court’s grant of summary judgment to Defendants on Adnet’s business conspiracy claim and remanded. The court explained that there is sufficient evidence of a direct competition for the subcontract between Adnet and Defendants while they were working for Adnet to bar a grant of summary judgment to Defendants. A reasonable juror could conclude that employees, like Defendants, breach their duty of loyalty to their employer when they learn of a potential business opportunity through their employment and then participate in direct competition with their employer for that opportunity while still employed. View "Adnet, Inc. v. Rohit Soni" on Justia Law

After Defendant’s allocution, but before his attorney argued at his sentencing hearing, the district court forecast that the minimum sentence he would receive was 60 months in prison—his crime’s statutory max. Defendant’s attorney then advocated for a lower sentence. The court imposed a 60-month sentence. He claimed it was procedurally unreasonable for the court to state his term of imprisonment before his attorney argued. Defendant also argued that his sentence is procedurally unreasonable because it was not adequately explained and was based on an incorrectly calculated guidelines range.The Fourth Circuit explained that because Defendant did not make this argument to the district court, the court reviewed it for plain error and found none. The court explained that the district court offered enough explanation to satisfy us that it considered Defendant’s alcohol addiction argument and had a reasoned basis for the sentence it imposed. Defendant and his defense counsel argued at sentencing that Defendant’s untreated alcohol addiction contributed to his crime and warranted a lighter sentence. In response, the district court suggested that it was Defendant’s own fault that he had not sought treatment for his addiction. The district court then discussed the nature of Defendant’s offense, the impact his actions had on his victims, and the danger he posed to the public. The record as a whole shows the district court’s rationale for discounting Defendant’s argument and why the court thought the Section 3553(a) factors outweighed it. Accordingly, the court rejected Defendant’s argument that the sentence was inadequately explained and, thus, procedurally unreasonable. View "US v. Joel Covington" on Justia Law

Plaintiff, an African American woman, worked as a conductor for Amtrak National Railroad Passenger Corporation (Amtrak). During her employment, she belonged to a division of the Sheet Metal, Air, Rail and Transportation Workers (SMART) union, which maintained a collective bargaining agreement (CBA) with Amtrak. Plaintiff brought the instant lawsuit pro se. She named Amtrak and the company’s director of employee relations as Defendants, along with three other Amtrak colleagues. Plaintiff asserted state-law claims of breach of contract and tort, as well as a federal claim of racial discrimination in violation of Title VII. Defendants moved to dismiss, and Plaintiff moved for summary judgment as well as for leave to amend her complaint. The district court granted Defendants’ motion and denied Plaintiff’s two motions. The district court held that Plaintiff’s claims were subject to arbitration under the Railway Labor Act (RLA).   The Fourth Circuit affirmed. The court explained that it declines to unwind a statutory scheme without a clear congressional directive to do so. Plaintiff argued that at least her particular claim is not a minor dispute. The mere fact that Plaintiff’s claim arises under Title VII does not disqualify that claim from being a minor dispute within the RLA’s ambit. The thrust of Plaintiff’s Title VII claim is that Amtrak deviated from its policies when dealing with her. While Plaintiff’s allegations as to her own treatment are factual, those concerning Amtrak’s policies directly implicate the relevant CBA between Plaintiff’s union, SMART, and Amtrak. That some of Plaintiff’s interpretive disagreements concern the Drug-Free Program does not alter the character of her claim. View "Dawn Polk v. Amtrak National Railroad Passenger Corporation" on Justia Law

Plaintiff was a subcontractor for Forney Enterprises, a contractor working for the Pentagon. Forney Enterprises was bonded through the Fidelity and Deposit Company of Maryland. Plaintiff worked as a project manager for Forney Enterprises, supervising others who engaged in manual labor. After Forney Enterprises’ work at the Pentagon was terminated, Plaintiff sued Fidelity to recover the value of the work he had not been paid for. The district court found that his supervisory work did not qualify as “labor” and granted summary judgment for Fidelity.   The Fourth Circuit affirmed. The court explained that Under the Miller Act, contractors hired to work on government projects are required to furnish bonds to pay those who provided labor and were not paid as a result of a dispute. But not all work on a government project qualifies as “labor” under the Miller Act. And even when the work qualifies as labor, to claim his piece of the bond, a laborer must sue within one year of completing the labor to recover. Here, the court found that much of Plaintiff’s work was “labor,” the only work he performed within one year of filing suit, a materials inventory, was not “labor.” And no circumstances warrant estopping Fidelity from asserting the statute of limitations. View "Elliot Dickson v. Fidelity and Deposit Company" on Justia Law