Eversheds Sutherland 11th Circuit Business Blog
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COURT LIMITS REVIEW OF REMAND ORDER BASED ON ONE DEFENDANT’S FORUM SELECTION CLAUSE

The Eleventh Circuit waded into a procedural thicket in Overlook Gardens Properties, LLC v. ORIX USA, L.P., 2019 WL 2590869 (11th Cir. June 25, 2019), ultimately concluding that it had no appellate jurisdiction to review an order remanding a removed case to state court .  At issue was the effect of a forum selection clause that bound one, but not all, of the defendants to litigate, in state court only, any dispute relating to the mortgage loan in issue. The district court held that defendant to have waived its right to removal, which precluded the required unanimous consent needed to remove...
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Florida Exemption Does Not Shield Improperly Maintained IRA from Creditors

An IRA owner could not rely on a Florida exemption to shield his IRA account from creditors after engaging in prohibited acts of self-dealing with his IRA funds, the Eleventh Circuit held in Yerian v. Webber, 2019 WL 2610751 (11th Cir. June 26, 2019). The IRA owner, Keith Yerian, opened a self-directed IRA. The IRA was governed by two contracts. One of the contracts required Yerian to refrain from engaging in prohibited acts, which included using IRA income or assets for his own interest or transferring IRA income or assets to himself or his spouse. Under § 408 of the federal tax code, an...
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Supreme Court Will Review Eleventh Circuit’s Decision that Official Code of Georgia Annotated Cannot Be Copyrighted

The Supreme Court yesterday granted certiorari to review the Eleventh Circuit’s decision in Code Revision Commission v. Public.Resource.Org, Inc., 906 F.3d 1229 (11th Cir. 2018), cert. granted, 2019 WL 1047486 (U.S. June 24, 2019). The question presented for review in Georgia v. Public.Resource.Org, Inc. is whether the principle that “government edicts,” such as statutes and judicial opinions, are not copyrightable extends to works that lack the force of law, such as the annotations in the Official Code of Georgia Annotated. The Eleventh Circuit, in an opinion authored by Judge Marcus, had...
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How Accountable Are You for Your Accountant’s Tax Fraud? The Eleventh Circuit Decides Not to Answer.

In Finnegan v. Commissioner, 2019 WL 2428109 (11th Cir. June 11, 2019), the Eleventh Circuit was asked to review whether a taxpayer may be indefinitely held responsible for the fraud of its paid tax return preparer. It is a question of special interest to small business owners that rely on an outside accountant to help with their taxes. Ultimately, the court chose not to answer the question because the taxpayer had not properly preserved the question at the lower court. The court’s decision not to review the issue leaves uncertainty for taxpayers in the Eleventh Circuit. Section 6501 of the...
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Court Grants En Banc Rehearing in Employment Retaliation Case

The Eleventh Circuit today granted the defendant employer’s petition for rehearing en banc in Gogel v. Kia Motors Manufacturing of Georgia, Inc., 904 F.3d 1226 (11th Cir. 2018). The now-vacated panel opinion, authored by Judge Martin, had affirmed summary judgment for the defendant on the plaintiff’s discrimination claims but revived her claim for retaliation. Judge Julie Carnes wrote a separate opinion dissenting as to the retaliation claim only, and the employer moved for en banc rehearing on that issue. Based on Judge Carnes’s dissent, the en banc decision may focus on the question of...
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CASH FROM CORN: PLAINTIFF INJURED AT CORN HARVESTING FACILITY ADVANCES TO TRIAL

The Eleventh Circuit reversed the district court’s grant of summary judgment to the employer of a forklift driver who injured a truck driver picking up a shipment of corn in Newcomb v. Spring Creek Cooler Inc., 2019 WL 2364498 (11th Cir. June 5, 2019). Because the plaintiff picking up a load of corn at the defendant’s facility was responsible for the count and condition of the load, he stood on the loading dock near the trailer so that he could take the corn’s temperature as it was being loaded. Over the course of an hour, the harvester’s employee drove the forklift to transfer corn pallets...
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Eleventh Circuit Takes the Middle of the Road in Evaluating a Foreign Tribunal’s “Receptivity” to Judicial Assistance from U.S. Courts

In Department of Caldas v. Diageo PLC, 2019 WL 2333910 (11th Cir. June 3, 2019), the Eleventh Circuit held that a district court evaluating a foreign court’s receptivity to judicial assistance from a U.S. Court in the context of an application for discovery under 28 U.S.C. § 1782 need not apply a rigid burden of proof.  Section 1782 permits, under certain circumstances, discovery in the United States for use in aid of a foreign proceeding.  In 2016, four Colombian Departments—the Department of Caldas, the Department of Cundinamarca, the Department of Valle del Cauca, and the Department of...
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Monkey See, Monkey Do: Eleventh Circuit Affirms Decision that Defendant’s Gorilla Logo Infringed Plaintiff’s Trademark But Vacates Award of Defendant’s Profits

In PlayNation Play Systems, Inc. v. Velex Corp., 2019 WL 2180589 (11th Cir. May 21, 2019), the Eleventh Circuit considered whether the district court erred in determining that the defendant infringed the plaintiff’s trademark and in awarding damages in the form of the defendant’s profits and cancellation of the defendant’s trademark. Plaintiff sold children’s outdoor play equipment, and defendant sold doorway pull-up bars. Both parties had registered trademarks that depicted gorillas and used the word “Gorilla.” To determine whether the defendant’s mark was likely to cause consumer confusion...
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Ex-Wife Who Was Fraudulently Transferred Millions Of Dollars Can’t Get Relief From Paying Her Ex-Husband’s Creditors, But She Doesn’t Have To Pay Punitive Damages Awarded Against Him

The Eleventh Circuit published a fraudulent-transfer decision in Alliant Tax Credit 31, Inc. v. Murphy, 2019 WL 2121297 (11th Cir. May 15, 2019). With appeals from both sides, the court tediously worked its way through numerous issues on appeal. Most of these involved state law questions, but the court in an opinion by Judge Tjoflat shed some light on mootness and assessing diversity jurisdiction in complicated cases. The defendant husband had transferred millions of dollars to his wife in a divorce settlement, making him judgment proof when other creditors sued him for debts he incurred on...
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“Once-Upon-A-Time” Injury Insufficient to Establish Article III Standing to Seek Declaratory and Injunctive Relief

The Eleventh Circuit has dismissed for lack of standing a trucking company’s suit for declaratory and injunctive relief against the Federal Motor Carrier Safety Administration (“FMCSA”). Flat Creek Trans., LLC v. Federal Motor Carrier Safety Admin., 2019 WL 2049770 (May 9, 2019). Flat Creek Transportation claimed that FMCSA had unfairly targeted the company for compliance reviews, which reviews could result in a “Conditional” or “Unsatisfactory” safety rating. Flat Creek alleged that in 2016, its regulatory consultant “received surreptitious reports from confidential informant(s)” that FMCSA...
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Eleventh Circuit Avoids Controversial Interpretative Question on S Corporation Taxation

In Meruelo v. Commissioner, 2019 WL 1986618 (11th Cir. May 6, 2019), the Eleventh Circuit was tasked with reviewing a controversial Tax Court decision regarding the basis created by a subchapter S corporation’s indebtedness to its shareholders. Meruelo v. Commissioner, T.C. Memo. 2018-16. In Judge William Pryor’s opinion, the court determined the case on its facts, never addressing the Tax Court’s decision that the common law “actual economic outlay” standard applied despite recent Treasury Regulations intended to override the doctrine. Meruelo was a shareholder in a real estate development...
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Party Seeking to Vacate International Arbitration Award Must Assert Ground Enumerated in Convention, Court Reaffirms

In Inversiones y Procesadora Tropical INPROTSA, S.A. v. Del Monte International GmbH, 2019 WL 1768911 (11th Cir. Apr. 23, 2019), the Eleventh Circuit affirmed the district court’s order that denied INPROTSA’s petition to vacate an international arbitration award and confirmed that award.  Concluding that INPROTSA was required to assert a valid defense under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“the Convention”), the court reaffirmed its holding in Industrial Risk Insurers v. M.A.N. Gutehoffnungshütte GmbH, 141 F.3d 1434, 1446 (11th Cir. 1998), and...
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Municipal Fair Housing Act Suit vs. Banks Is Again Green-Lighted

Capping off a busy week, the Eleventh Circuit took a second crack at whether a municipality can bring an action under the Fair Housing Act against banks to recover damages allegedly attributable to racially discriminatory lending practices. In the prior round, the court held that the City of Miami had alleged standing and causation sufficiently to survive a motion to dismiss. But the Supreme Court granted review and scaled back that decision, holding that although standing was adequately alleged, causation was not, because more than foreseeability was required to demonstrate proximate cause....
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Ponzi Scheme Victims Prevail over SEC Receiver on Due Process Grounds

In SEC v. Torchia, 2019 WL 1911823 (11th Cir. Apr. 30, 2019), the Eleventh Circuit held in favor of investors victimized by a Ponzi scheme, concluding that the investors were permitted to appeal the district court’s interlocutory orders regarding receivership proceedings and that they had been denied a meaningful day in court. The appeal arose from the SEC’s case against James Torchia charging that he orchestrated a Ponzi scheme. As part of Torchia’s alleged scheme, investors purchased life settlement policies. The district court froze the assets of one the entities used by Torchia to...
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