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Editor’s Note: This is the last in a series of end-of-year stories. Some of the most interesting cases argued in 2007 before the 3rd U.S. Circuit Court of Appeals are still pending – most likely to be decided sometime in 2008 – including the appeal by death-row inmate Mumia Abu-Jamal and CBS Corp.’s battle with the FCC over the fines imposed for Janet Jackson’s infamous “wardrobe malfunction” at the 2004 Super Bowl. One new judge, Thomas Hardiman, joined the court in 2007, and nominations are pending before the Senate for the two remaining vacancies. If the Senate confirms those two nominees – New Jersey attorney Shalom D. Stone and Eastern District of Pennsylvania Judge Gene E. K. Pratter – half of the 3rd Circuit’s 14 active judges will be appointees of President George W. Bush. In one of the most closely watched cases of 2007, the 3rd Circuit ruled in AARP v. EEOC that employers are free to modify health care benefits for retirees as soon as they become eligible for Medicare. Rejecting a challenge to an EEOC regulation that approved the practice, the court found that the agency has broad powers to create “exemptions” for practices that would otherwise violate federal age discrimination laws. Mumia Spectators packed the courtroom when the 3rd Circuit heard oral arguments in an appeal by Mumia Abu-Jamal, perhaps the world’s most famous death-row inmate who was convicted and sentenced to die a quarter century ago for the murder of Philadelphia police officer Daniel Faulkner. Abu-Jamal’s death sentence was overturned due to confusing jury instructions, but his conviction was upheld by U.S. District Judge William H. Yohn Jr. in December 2001. In the 3rd Circuit appeal, prosecutors are asking that the death sentence be reinstated and Abu-Jamal’s lawyers are asking for an entirely new trial, arguing that the conviction must be overturned because there is evidence that prosecutors improperly struck black jurors in his 1982 trial. Chief Judge Anthony J. Scirica and Judges Thomas L. Ambro and Robert E. Cowen heard oral arguments that lasted more than two hours – far longer than the ordinary 15 minutes per side. But for many of the hundreds of spectators who packed the courtroom, the arguments were likely difficult to follow as the judges and lawyers spoke in a lexicon specific to modern-day death penalty litigation, often referring to case law from the 3rd Circuit and the U.S. Supreme Court. Much of the arguments focused on highly technical and complicated questions about how the federal courts should weigh such claims when a state court system has already rejected identical arguments and upheld both the conviction and death sentence. But the bottom line was fairly simple: Prosecutors insisted that Abu-Jamal got a fair shake in the Pennsylvania courts and that the federal courts should not second-guess those rulings. But Abu-Jamal’s lawyers insisted in oral arguments that no court has ever given their client justice since his trial was unfair from the start due to a racially biased jury selection process and a racist trial judge. Wardrobe Malfunction The courtroom was packed again in September when the 3rd Circuit heard argument in CBS’ appeal over fines imposed for the “wardrobe malfunction” at the 2004 Super Bowl in which singer Janet Jackson’s breast was briefly exposed to millions of television viewers. “CBS neither planned nor approved this split-second incident,” attorney Robert Corn-Revere of Davis Wright & Tremaine in Washington, D.C., argued. Corn-Revere urged the three-judge panel to overturn a $550,000 fine imposed by the Federal Communications Commission, arguing that the agency unfairly held the network responsible for the conduct of Jackson and singer Justin Timberlake. But Justice Department attorney Eric Miller insisted that Jackson and Timberlake were legally CBS employees that day and that the network failed to exercise proper control over them despite ample warning signs that they were planning to do something “shocking.” “CBS broadcast the spectacle of a man singing ‘Gonna have you naked by the end of this song,’ while simultaneously grabbing a woman, ripping apart her clothing and exposing her breast to the largest television audience of any broadcast that year,” Miller said. Although the incident was very brief, Miller said, the FCC imposed fines due to its graphic nature and the fact that it was done purely for shock value in a program that children were watching and which carried no warnings of possible adult content. Products Liability Industry scored a significant victory when the 3rd Circuit overturned a $13.5 million jury verdict in a products liability case. The 3rd Circuit ruled that while Pennsylvania law calls for judges to make an initial determination of whether a product is “unreasonably dangerous,” the jury must also be allowed to hear evidence relating to that risk-utility analysis before it makes its decision on liability. In Moyer v. United Dominion Industries Inc., the court found that the trial judge had misapplied the Pennsylvania Supreme Court’s 1978 decision in Azzarello v. Black Bros. Co. in which the justices called for a two-step process in strict liability cases in which the trial judge conducts a risk-utility analysis to decide the legal question of whether a product is unreasonably dangerous and the jury decides only whether the product “left the supplier’s control lacking any element necessary to make it safe for its intended use.” Federal courthouse security officers who were fired when they failed to meet stricter medical requirements lost their 3rd Circuit appeal seeking to revive their lawsuit against the U.S. Marshal’s Service, the Judicial Conference of the United States, the U.S. Department of Justice and MVM Inc., the private security company that employed them. In the suit, three court security officers (CSOs) complained that their firings violated their rights to due process and equal protection, as well as the Americans With Disabilities Act, the Rehabilitation Act and state contract law. But the 3rd Circuit upheld a decision by Eastern District Chief Judge Harvey Bartle III, who found that the CSOs were given fair notice that they could be deemed “medically disqualified” from their posts and were provided with an opportunity to respond and present evidence to the contrary. A killing spree by a mentally unstable veteran that led to a $7.4 million verdict against the Department of Veterans Affairs forced the 3rd Circuit to decide whether the agency could be held responsible for expelling the man from a treatment center despite his “rage disorder” diagnosis. In DeJesus v. United States, a unanimous three-judge panel upheld the verdict rendered by U.S. District Judge Paul S. Diamond, who concluded after a nonjury trial that the murders were the direct result of the VA’s “gross negligence.” Diamond concluded that VA officials should have known that the decision to expel Alejandro DeJesus from a treatment center and fire him from his job there would trigger his rage disorder and put his family in danger. In March 1999, just one day after he was expelled, DeJesus shot and killed his children, Alejandro Jr., 22, and Felicia, 7, and their friends, Michael Faulk, 16, and Aaron Faulk, 14, and then committed suicide. The Department of Veterans Affairs Medical Center in Coatesville had been treating DeJesus since 1997 for severe mental problems including “intermittent explosive disorder,” drug addiction and domestic abuse. Just one day before the murders, Diamond found, the VA expelled DeJesus because he had attacked another resident with a knife, despite a warning from a therapist who said she feared his expulsion “might provoke him to an act of domestic violence.” The 3rd Circuit, in an opinion by Judge D. Michael Fisher, upheld the verdict, saying “we are satisfied that the district court’s determination that the VA was grossly negligent is not only not clearly erroneous, but is a correct decision.” Insurance In a major setback for insurers, the 3rd Circuit revived a RICO suit against First Unum Life Insurance Co., finding that a lower court erred when it held that such a claim would interfere with state regulation of insurers. “There is nothing of record in this case that suggests that the availability of RICO would disrupt the playing field in the state insurance regime beyond what was clearly intended by state law,” U.S. Circuit Judge Marjorie O. Rendell wrote in Weiss v. First Unum Life Insurance Co. In a huge win for recovering heroin addicts, the 3rd Circuit struck down a Pennsylvania statute that restricts the placement of a methadone-treatment facility within 500 feet of a school, public playground or park, residential housing area, child-care facility or church. “A law that singles out methadone clinics for different zoning procedures is facially discriminatory under the ADA [Americans With Disabilities Act] and the Rehabilitation Act,” Judge D. Brooks Smith wrote in New Directions Treatment Services v. City of Reading. Antitrust Giving quick effect to the U.S. Supreme Court’s most recent business-friendly antitrust ruling, the 3rd Circuit upheld the dismissal of a suit brought by a beauty supplies company that said it was the victim of a “group boycott” by distributors of so-called “salon-only” products. In Cosmetic Gallery Inc. v. Schoeneman Corp., the court said the plaintiff had failed to show the existence of a group boycott because its evidence “falls short of excluding the possibility that the distributors acted independently.” Writing for the court, Chief Judge Anthony J. Scirica cited several times to the U.S. Supreme Court’s recent 7-2 decision in Bell Atlantic v. Twombly, which held that plaintiffs alleging an antitrust conspiracy must show more than “parallel conduct,” and must have evidence that rules out the possibility that the alleged conspirators had acted on their own. A Significant Fall When attorney Patrick J. O’Connor of Cozen O’Connor took a vacation in Barbados with his wife in 2003 and seriously injured his shoulder – in a slip and fall in a shower after receiving a massage – he probably had no idea that his lawsuit against the resort would later result in a significant opinion from the 3rd Circuit that would clarify the law on personal jurisdiction. The O’Connors’ suit against the Sandy Lane Hotel was dismissed by a lower court on the grounds that the hotel’s “activities in Pennsylvania fall short of the standard required to establish personal jurisdiction.” But the 3rd Circuit revived the suit, finding that the hotel, by mailing a brochure to Pennsylvania and making phone calls to finalize the O’Connors’ reservations for spa treatments, had “deliberately reached into Pennsylvania to target two of its citizens.” And since one of those spa treatments directly led to O’Connor’s injury, the court found that the hotel’s contacts with Pennsylvania were sufficiently related to the claim. ERISA Workers who “cash out” their 401(k) plans still have standing to sue the administrator of the plan under ERISA for alleged mismanagement of the fund, the 3rd Circuit held in Graden v. Conexant Systems Inc. The unanimous three-judge panel reversed a lower court’s decision to dismiss Howard Graden’s suit on the grounds that such a former employee, once he is cashed out, is no longer a “participant” in the plan and has therefore lost standing under the Employee Retirement Income Security Act (ERISA). “When determining participant standing under ERISA, the relevant inquiry is whether the plaintiff alleges that his benefit payment was deficient on the day it was paid under the terms of the plan and the statute,” Judge Thomas L. Ambro wrote. “If so, he states a claim for benefits, which, if colorable, makes him a participant with standing to sue.” In a big win for drug manufacturers, the 3rd Circuit ruled in Pennsylvania Employees Benefit Trust Fund v. Zeneca Inc. that federal law bars a suit alleging false-advertising claims under state law because the U.S. Food and Drug Administration has “exclusive authority” to regulate prescription drug advertising. “To allow generalized state consumer fraud laws to dictate the parameters of false and misleading advertising in the prescription drug context would pose an undue obstacle to both Congress’ and the FDA’s objectives in protecting the nation’s prescription drug users,” Judge D. Brooks Smith wrote. The ruling upheld the dismissal of a proposed class action suit accusing Zeneca of misleading consumers and doctors by advertising the acid reflux drug Nexium as an improvement over Prilosec because it knew that the patent for Prilosec was about to expire and a generic version would soon be hitting the market. Philadelphia health department officials who provided “morning-after” pills to a 16-year-old girl were cleared of any wrongdoing when the 3rd Circuit held they did not violate the girl’s civil rights nor those of her parents. The suit accused city health workers of failing to explain that the drug could prevent the implantation of a fertilized egg – something that the girl and her parents equate with abortion. But Judge Theodore A. McKee Jr. found that a lower court had properly dismissed the suit because “the Constitution does not impose an affirmative obligation on defendants to ensure that children abide by their parents wishes, values or religious beliefs.” Fourteen alleged victims of sexual abuse by Catholic priests lost their bid to revive a civil RICO suit against the Archdiocese of Philadelphia for its alleged cover-up of the scandal when the 3rd Circuit held they failed to allege RICO-style injury. In Magnum v. Archdiocese of Philadelphia, the plaintiffs claimed that the alleged cover-up had deprived them of the opportunity to bring personal injury suits within the statute of limitations. But Thomas M. Hardiman found that the case was properly dismissed because “the lost opportunity to bring a state law personal injury claim is not ‘business or property’ within the meaning of Section 1964(c), and cannot support a civil RICO claim.”

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