Undoubtedly the recent revelations regarding “Operation Fast and Furious” conducted by the Bureau of Alcohol, Tobacco, and Firearms raises a whole host of legal issues.  But one in particular that surfaced in a new report the other day sparked my interest. 

A piece in the Washington Times on July 6th contained this snippet:

In the letter Tuesday to Mr. Holder, Mr. Grassley and Mr. Issa said they were “disappointed” that the Justice Department failed to tell Mr. Melson he had the right to choose a voluntary interview rather than participate with counsel representing the department’s interests.

Now to me, this poses that classic law school professional responsibility query:  Who is the client?  When a Department of Justice lawyer represents the head of a government agency at a Congressional hearing, who is the client?  Is it the administration at whose pleasure the attorney serves, the DOJ, the ATF, or the individual himself?

Turning to a quick plain language search of All Federal materials on WestlawNext,

client of federal government attorney (14) Content: Overview Jurisdiction: All Federal

 perhaps the most interesting guidance comes from the CFR.

 Attorneys employed by any component of the Department of Justice who participate in any process utilized for the purpose of determining whether the Department should provide representation to a federal employee, undertake a full and traditional attorney-client relationship with the employee with respect to application of the attorney-client privilege.    

28 C.F.R. § 50.15(a)(3).

 Under the circumstances described in section 50.15, where a government official has been “sued, subpoenaed, or charged in his individual capacity” and “when the actions for which representation is requested reasonably appear to have been performed within the scope of the employee’s employment and the Attorney General or his designee determines that providing representation would otherwise be in the interest of the United States,” the individual is the client.  So Ken Melson, acting director of the ATF would be the client in a hearing before Congress.

But what if Melson is ultimately determined to be the one responsible and he now faces criminal charges stemming from this program?  Again, section 50.15 provides an answer, but it doesn’t really lay the question to rest.

Representation generally is not available in federal criminal proceedings. Representation may be provided to a federal employee in connection with a federal criminal proceeding only where the Attorney General or his designee determines that representation is in the interest of the United States and subject to applicable limitations of § 50.16. In determining whether representation in a federal criminal proceeding is in the interest of the United States, the Attorney General or his designee shall consider, among other factors, the relevance of any non-prosecutorial interests of the United States, the importance of the interests implicated, the Department’s ability to protect those interests through other means, and the likelihood of a conflict of interest between the Department’s prosecutorial and representational responsibilities. If representation is authorized, the Attorney General or his designee also may determine whether representation by Department attorneys, retention of private counsel at federal expense, or reimbursement to the employee of private counsel fees is most appropriate under the circumstances.

28 C.F.R. 50.15(a)(4)

If the prosecuting division indicates that the employee is the subject of a federal criminal investigation concerning the act or acts for which he seeks representation, the litigating division shall inform the employee that no representation by Justice Department attorneys will be provided in that federal criminal proceeding or in any related civil, congressional, or state criminal proceeding. In such a case, however, the litigating division, in its discretion, may provide a private attorney to the employee at federal expense under the procedures of § 50.16, or provide reimbursement to employees for private attorney fees incurred in connection with such related civil, congressional, or state criminal proceeding, provided no decision has been made to seek an indictment or file an information against the employee.

28 C.F.R. 50.15(a)(8)

The Department can’t represent an individual it knows it intends to prosecute.  But what if it doesn’t know and the Congressional hearing provides the impetus for the charges?  That opens a whole new can of worms.

All in all, with so many questions and problems swirling around this issue, if I were in Melson’s shoes, I think I’d be giving a long hard look at 28 C.F.R. 50.16 - Representation of Federal employees by private counsel at Federal expense.

Minnesota, where the Reference Attorneys are located and where many of us have practiced, currently allows for the retainer of a lawyer by means of a nonrefundable retainer fee.  In fact, here in Minnesota it’s not uncommon for solo practitioners, particularly those practicing in areas such as criminal defense or estate planning, to use such retainer agreements almost exclusively.  Under the current writing of Minnesota Rules of Professional Conduct Rule 1.5:

All agreements for the advance payment of nonrefundable fees to secure a lawyer’s availability for a specific period of time or a specific service shall be reasonable in amount and clearly communicated in a writing signed by the client.

There is no requirement that the fee be held in a trust account, and if the client terminates the representation, often times that means forfeiture of the retainer as well.

Minnesota seems on par with other states in this respect.  See, e.g., In re Connelly (2002) 203 Ariz. 413, 55 P.3d 756 (Ariz. 2002) (stating because a non-refundable flat fee reflects a balancing of the risk to both client and lawyer, a flat fee can be larger than the fee generated by hourly rates without being excessive under the rules of professional conduct under Ariz. R. Prof. Cond. Rule 1.5); FL ST BAR Rule 4-1.5.  But see, CO ST RPC Rule 1.5 (“Nonrefundable fees and nonrefundable retainers are prohibited.”) (effective July 1, 2011); In re Stephens, 2006, 851 N.E.2d 1256  (Ind. 2006) (holding nonrefundable retainer provision of attorney’s malpractice employment agreement with client violated rule of professional conduct requiring that a lawyer’s fee be reasonable, as it locked client to attorney, thereby chilling client’s right to terminate the representation under Ind. R. Prof. Cond. Rule 1.5).

However the Minnesota Supreme Court recently opted to change language of Rule 1.5.  Under the new wording:

A lawyer may charge a flat fee for specified legal services, which constitutes complete payment for those services and may be paid in whole or in part in advance of the lawyer providing the services. If agreed to in advance in a written fee agreement signed by the client, a flat fee shall be considered to be the lawyer’s property upon payment of the fee, subject to refund as described in Rule 1.5(b)(3). Such a written fee agreement shall notify the client: (i) of the nature and scope of the services to be provided; (ii) of the total amount of the fee and the terms of payment; (iii) that the fee will not be held in a trust account until earned; (iv) that the client has the right to terminate the client-lawyer relationship; and

(v) that the client will be entitled to a refund of all or a portion of the fee if the agreed-upon legal services are not provided. . . . .

(3) Fee agreements may not describe any fee as nonrefundable or earned upon receipt but may describe the advance fee payment as the lawyer’s property subject to refund. Whenever a client has paid a flat fee . . . and the lawyer-client relationship is terminated before the fee is fully earned, the lawyer shall refund to the client the unearned portion of the fee. If a client disputes the amount of the fee that has been earned, the lawyer shall take reasonable and prompt action to resolve the dispute.

Minn. R. Prof. Cond. 1.5(b)(1) (effective July 1, 2011) as amended by MN ORDER 11-0005.

While not prohibiting nonrefundable language as expressly as Colorado, one can’t help but wonder if the de facto application of this amendment will have the same result. 

Under the new language of the rule, the nonrefundable fee is considered “the lawyer’s property subject to refund.”  The lawyer must return the unearned portion of the fee to the client if the relationship is terminated prior to the fee being fully earned.  This is where things get tricky…

How exactly does one know when a fee has been fully earned?  A typical flat-fee retainer would state a dollar amount for services to be performed, but not necessarily an hourly rate by which that would be computed.  Seemingly, though, such an hourly arrangement would be the only way to determine if the attorney has earned the fee on a quantum meruit basis upon termination of the relationship. 

As an illustration, if an attorney were to charge a flat, nonrefundable $2,000 retainer to represent a client in connection with a first-offense DWI, go into court for the initial appearance, get an offer for a diversionary program, and help his client enter a plea that day.  How would that attorney be able to establish a right to the full amount of the retainer if no hourly amount had been agreed upon for the purposes of such calculation?  And if that is the method of choice for the determination, is that not a de facto hourly retainer agreement, but with a cap on the amount the attorney can earn in the event the case proceeds to trial?

And then comes the issue of the impact on the lawyer’s accounting practices.  Presumably many attorneys working on flat-fee arrangements treated a nonrefundable retainer as money in the bank.  Literally.  But now, as the rule specifies that it is the lawyer’s property subject to refund, would the prudent lawyer put the money in trust so as to avoid an accounting headache should a refund be necessary?  Moreover, does the typical solo attorney used to working on flat fees have the facilities or business practices to track when a fee is earned so as to keep track of refunds?

Certainly this amendment to the rule raises some questions.  It will be interesting to see how this plays out over the next few years as attorneys adapt.

Additional Research References:

I recently returned from the annual Expo of the International Association of Amusement Parks and Attractions (IAAPA) held in Orlando. One of the important issues discussed in several class seminars was the new Americans with Disabilities Act Accessibility Guidelines (ADAAG).  While the amusement industry strives to put smiles on people’s faces and to appeal to the broadest spectrum of the population as possible, safety of all guests is a prominent concern to the industry.  Operators are constantly striving to have a good working knowledge of the A.D.A. requirements and how they impact operations.  Such knowledge becomes extremely complex when you look at the wide variety of goods and services offered at an amusement facility or traveling show.  The facility or show not only provides amusement rides, but it also provides water attractions, go-karts, miniature golf, indoor theaters, restaurants, games, shopping, camping facilities and restrooms.  Each of these areas has its own nuances and requirements under the ADAAGs.

On September 15th of this year, the Civil Rights Division of the Department of Justice promulgated a final rule amending its ADA Title III regulation, which covers nondiscrimination on the basis of disability by public accommodations and in commercial facilities.  The final rule can be found on Westlaw at 75 FR 56164. For earlier versions of the rule, you can use the Regulation Identification Number (RIN), 1190-AA46, as your search term in the FR database.  (A very common research question is, ‘I have the notice of proposed rule making, has the agency adopted the final rule?’ Most agencies, but not all, use RINs.  If you’ve got one, run it as your search term to find related proposed, amended and final rules.)

The final rule adopts the 2004 ADAAG and makes them operable six (6) months after publication or on March 15, 2011; while the 2010 Standards (ADAAG) will become enforceable eighteen (18) months after publication or March 15, 2012.  With the promulgation of 2010 Standards, amusement operators will be looking at ways to better accommodate hearing-impaired and sight-impaired guests.  Keep your eyes open for future discussions on this topic.

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I follow the legal happenings of the amusement industry as part of another blog I write. I find it useful to set up a Westclip as a way of monitoring recent opinions issued in the amusement industry area.  Based on the number of type of results I received over the past 9 years, I have tweaked my Westclip on several occasions to add new concepts to my search.

Recently, my Westclip informed me of the case of Pickaway County Skilled Gaming, L.L.C. v. Cordray 2010 WL 3972575 (Ohio 2010), in which the Ohio Supreme Court reviewed Ohio Statutes R.C. 2915.02(A)(2) and R.C. 2915.01 (AAA)(1) when an operator of a members-only amusement game arcade that handed out cash prizes to players challenged the $10 prize limit for each play on its machines, arguing that the limit was not rationally related to determining whether amusement machines are based on skill or on chance which violated the Equal Protection Clause of the United States and Ohio constitutions.  R.C. 2915.02(A)(2) states that no person shall “[e]stablish, promote, or operate or knowingly engage in conduct that facilitates * * * any scheme of chance.” R.C. 2915.01(C) defines “scheme of chance”; the subsection specifically states that a “scheme of chance” does not include a skill-based amusement machine. These types of machines range from games (e.g., Skee-ball and Whack-a-Mole) commonly found at fair and amusement-park midways and in family fun centers to more sophisticated skill-based games found in the members-only arcade that was involved in this case.

In response to a documented “increase in the number of illegal gambling machines around the State of Ohio,” Ohio Governor Ted Strickland issued Executive Order 2007-28S on August 22, 2007.  Through this Executive Order, Governor Strickland declared an emergency justifying suspension of the normal rulemaking process and authorized the attorney general to immediately adopt former Ohio Adm.Code 109:4-3-31. Executive Order 2007-28S at ¶ 9-10.  Shortly thereafter, the Ohio Attorney General closed Pickaway County Skilled Gaming (“Pickaway”) in violation of the new rule and Pickaway challenged the rule and requested an injunction.  While the challenge was pending, the Ohio House of Representatives passed Sub.H.B. No. 177, which, among other provisions, amended R.C. 2915.01(AAA). The bill incorporated into the statute much of the language defining “skill-based amusement machines” that had been set forth in Ohio Adm.Code 109:4-3-31, including the ten-dollar prize-value limit.  Now the Ohio Attorney General defends the statute saying that the limit is rationally related to two legitimate government interests: (1) establishing economic regulations governing the operation of skill-based amusement machines and (2) protecting against criminal acts and enterprises as a prophylactic measure against illegal gambling.

The Ohio Supreme Court agreed with the Attorney General.  According to the Court, “[t]he rational-basis test involves a two-step analysis. We must first identify a valid state interest. Second, we must determine whether the method or means by which the state has chosen to advance that interest is rational.” McCrone v. Bank One Corp., 107 Ohio St.3d 272, 2005-Ohio-6505, 839 N.E.2d 1, ¶ 9, citing Buchman v. Wayne Trace Local School Dist. Bd. of Edn. (1995), 73 Ohio St.3d 260, 267, 652 N.E.2d 952.  The Court agreed that R.C. 2915.01 does help protect two valid government interests and “[u]nder the rational-basis standard, a state has no obligation to produce evidence to sustain the rationality of a statutory classification.” Columbia Gas Transm. Corp. v. Levin, 117 Ohio St.3d 122, 2008-Ohio-511, 882 N.E.2d 400, ¶ 91, citing Am. Assn. of Univ. Professors, Cent. State Univ. Chapter, 87 Ohio St.3d at 58, 60, 717 N.E.2d 286. “[S]tatutes are presumed to be constitutional and * * * courts have a duty to liberally construe statutes in order to save them from constitutional infirmities.” Eppley, 122 Ohio St.3d 56, 2009-Ohio-1970, 908 N.E.2d 401, ¶ 12, citing Desenco, Inc. v. Akron (1999), 84 Ohio St.3d 535, 538, 706 N.E.2d 323.

So how does one cope to have games within the statutory limits but offer big prizes?  As Pickaway stated in the case, because the dollar limit is based on each play, and R.C. 2915.01(AAA)(1) does not limit the number of times an individual can play a skill-based amusement machine, players can amass endless vouchers and redeem them for valuable prizes.

In a recent order United States Magistrate Judge James L. Cott (Southern District of New York), denied Gucci’s application for a protective order against the disclosure of the privileged communications of Gucci’s Vice-President, Director of Legal and Real Estate Jonathan Moss, on attorney-client grounds.  See entry 125 at 1:09CV04373.  The Court recognized that for the duration of his employment with Gucci, Jonathan Moss was an inactive member of the California State Bar.

The court claims that an essential element of the attorney-client privilege is that an attorney participates in the communication.  The court reasoned that an attorney is one who is “admitted to the bar of a state or federal court.”  In re Rivastigmine Patent Litigat., 237 F.R.D. 428.  Cott cites Wright and Miller’s Federal Practice and Procedure sec. 5480 : “[I]nactive or retired membership that does not permit the member to practice law will not suffice.”  The Order stated that “Moss did not possess the type of bar membership that authorized him to engage in the practice  of law.  California explicitly limits the practice of law to active members.”  Cal. Bus. & Prof. Code Sec. 6125.  Since Moss had no bar membership authorizing him to practice law in any jurisdiction, Gucci’s communications would not satisfy any standard of the attorney-client privilege.

The court’s order continues to look at the federal common law that a client can avail itself of the privilege if the client can demonstrate that it reasonably believes the person (Moss) was authorized to practice law.  In this case, however, Gucci cannot make this claim.  Once Gucci promoted Moss to a legal position, it was obligated to conduct some due diligence to confirm Moss’s professional status as an attorney.  Minimal due diligence includes that Gucci confirm Moss was licensed in some jurisdiction, that the license authorized him to practice law, and that he was not suspended from practicing or faced disciplinary sanctions.

This Memorandum and Order appears to place a burden on corporations, and potentially outside counsel, to check in-house counsel’s bar status before discussing privileged corporate information with that counsel and most certainly before placing any documents involving that counsel on a privilege log in front of opposing counsel.  Corporations can easily confirme in-house attorney licensure by using the appropriate Individual State  ATTYLICENSE-XX  database on Westlaw.

In 1938, the Nazi’s arrested  Fritz Grunbaum, a Jewish cabaret performer as he attempted to flee Europe.  He was deported to Dachau and died there in 1941.  During his incarceration, Grunbaum was forced to execute a power of attorney which effectively divested him of his property including a work of art by the Viennese artist, Egon Schiele.  The work found its way to Swiss art gallery and then to New York where David Bakalar, a Massachusetts resident, purchased it for $4300. Earlier this month, the Second Court of Appeals vacated a Southern District of New York judgment and held that New York law, not Swiss law applied to Mr. Bakalar’s declaratory judgment action.  See 2010 WL 3435375.  In New York, unlike Switzerland, a thief cannot pass good title.  Stolen artwork, the Second Circuit concluded, belongs to the original owner.

Raymond J. Dowd is a partner and member of Dunnington, Bartholow and Miller’s intellectual property and art law practice groups. He has broad commercial litigation experience and is author of the Copyright Litigation Handbook (on Westlaw at COPYLITIG).  He also writes the Copyright Litigation Blog (http://copyrightlitigation.blogspot.com/).  He represented the Grunbaum heirs. We interviewed Mr. Dowd last week.

Reference Attorneys (RA):  Welcome and congratulations, Mr. Dowd. The focus of our blog is really nuts and bolts, legal research.  But, it’s hard to ignore the incredible story behind this litigation; from the tragedy at Dachau to what the court described as the “shadowy institution of the art gallery.”  I was especially struck, by the comments of the U.S. Consul General cited in the concurrence stating that there was “a curious respect for legalistic formalities.  The signature of the person despoiled is always obtained, even if the person in question has to be sent to Dachau in order to break down his resistance.” And, this, by historian Raul Hilberg, also cited by the concurrence:  “Lawyers were everywhere…again and again, there was a need for legal justifications.”

Time has passed (and, we’re in the US) but, the Swiss law seems to perpetuate the ill effect of those ‘legalistic formalities.’  What does this say about our profession?

Raymond Dowd (RD): The rise of Nazi Germany and the central role played by the legal profession shows how important it is to have an independent bar that actively promotes individual liberties and property rights in the face of state action, political pressures or unpopular causes.  Too many of us are silent when rights guaranteed by the Constitution are infringed, particularly when those rights belong to an unpopular minority.

RA: As an experienced litigator, how do you view your role in righting this wrong?

RD: Specific to the Nazi spoliation of Jews 1933 through 1942, I have been able, with the help of the world’s leading historian in the area, to reconstruct the legal environment in position at the time.  We had to take Nazi-era legal documents, decrees and other evidence scattered in various publications and tie them together to demonstrate that Jews weren’t simply voluntarily abandoning their property en masse, that there were legal coercions such  taxes and as 90% confiscatory foreign exchange rates that pauperized anyone wishing to flee the country.

RA: Also, I mention the $4300 price tag because there’s obviously more at stake here than the value of a work of art.  How would you characterize the ‘value’ of this case?

RD: I have spend five years of my life on this case, often with the evidence of hundreds of thousands of murders on my desk or a nearby bookshelf.   The massive spoliation of Jews has been overshadowed in history by the horror of the murders.  For a full picture of history, we must realize that 8-9% of Germany’s budget of 1938-39 was stolen from Jews.  When we put the profit motive into the Holocaust, it gives us a new understanding of why the murders took place and how the Nazis exterminated a pauperized population.

RA: I was surprised by the amount of materials related to stolen and looted art.  This case sites to several publications.  Is there a resource you relied on or might recommend?

RD: It is estimated that over 600,000 artworks stolen by the Nazis alone are still missing.  Many books have been written, it really depends on the country and era.  For provenance researchers, there is the American Association of Museums Guide to Provenance Research.  There are reports on stolen art that date back to the 1940’s and websites of many of the major museums report on dubious provenances in their collections.

RA: What can you tell us about the ‘art law?’  Is this a growing practice area?

RD: I think that art and cultural property will grow in significance as a practice area.  Now the number of practitioners is relatively small.  But U.S. museums have enjoyed explosive growth, and the US public has taken to art collecting and contemporary art like never before.   As in any other multi-billion dollar industries, lawyers are needed.

RA: Is it limited to stolen and looted art?

RD: No, there is a significant legal trade in art and artworks and a myriad of problems that implicate everything from construction law to labor law.

RA: Do you have a sense for how big the problem of looted and stolen art is?

RD: I hear statistics that the illicit art trade is just behind the illegal arms and drug trades.

RA: Customers reading this case will be calling Reference Attorneys for the Austrian Nullification Act, Article 934 of the Swiss Civil Code, the Bergier Commission Report.  Are these materials provided exclusively by your experts, or is there a resource you enjoy for these kinds of historical and international material?

RD: The Final Bergier Commission report is available online in English at http://www.uek.ch/en/index.htm.  I am not aware of any commercially available English-language translations of the Austrian or Swiss Civil Codes, we had to pay to translate these and relied on foreign law experts.   If you look at Cultural Property blogs, you can locate good resources.

RA: I learned a new term of art; a work’s “provenance” significantly affects work’s value.  This sounds like a job for a history detective.  Any recommendations for researching a work’s “provenance?”

RD: Attorneys and judges are not trained in historiography.  An attorney must work closely with provenance researchers or “art detectives,” as well as genealogists specialized in probate research and historians trained in art.  History is not logic.  I think that after learning a lot about the particular art, artist and historical context, an attorney can work well with these professionals to develop theories of a case or draw solid conclusions from historical documentation.

RA: Finally, where I can our readers find you in the near future?  Are you presenting or participating in any upcoming events?

RD: I will be speaking at the upcoming Federal Bar Association Convention in New Orleans, for more information, www.fedbar.org For more news on speaking enagements and Nazi-looted art, please subscribe to Copyright Litigation Blog (http://copyrightlitigation.blogspot.com/).

The Wall Street Journal’s Law Blog yesterday had a story regarding a federal inmate and frequent frivolous litigant Jonathan Lee Riches.  It seems that the United States District Attorney for the Eastern District of Kentucky has attempted to obtain an injunction preventing Mr. Riches from filing documents in any court unless a  federal judge determines that they have a basis in law and fact.

Mr. Riche’s history of filing lawsuits that are later dismissed as frivolous is quite long.  His filings are often hard to understand, and his list of parties are also sometimes confusing.  A search of:

AT(LEE-RICHES) & PRO-SE INMATE-MAIL CORRECTIONAL-INSTITUTION

Returns over 2,000 results in DOCK-ALL, although in fairness they may not all be Mr. Lees cases, they are simply anything with Lee Riches in the attorney field with pro se, inmate mail, or correctional institution elsewhere in the document.  One docket in particular stands out (and has a new motion filed as of July 30th 2010) as having a very strange mix of parties, some of the extremely numerous names:

We start out with the usual individuals:

GEORGE W. BUSH INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS PRESIDENT OF THE UNITED STATES OF AMERICA

RICHARD B. CHENEY VICE PRESIDENT

CONDOLEEZA RICE SECRETARY OF STATE

No real surprises there for a case filed in 2006.  However the list of parties also contains foreign governments and celebrities:

KINGDOM OF SAUDI ARABIA

JEWISH STATE OF ISRAEL

THE VATICAN

JERRY WEST VICE PRESIDENT OF THE LOS ANGELES LAKERS

TONY DANZA

ANNA NICHOLE SMITH

BRAD PITT AND HIS ADOPTED SON MADDOX PITT/JOLIE

SADDAM HUSSEIN

But more strangely included are a large list of inanimate objects, geographical places, long dead historical figures, wholly fictional product spokespeople and sometimes ephemeral concepts that have no physical existence.  Some examples:

VIENNA CONVENTION

MAGNA CARTA

TSUNAMI VICTIMS

FRUIT OF A-LOOM [sic.]

PLATO

MEIN KAMPF

NORDIC GODS

THE DA VINCI CODE

MT. RUSHMORE

GREEN BAY’S LAMBEAU FIELD

MING DYNASTY

GANGS IN HONG KONG

THE APPALACHIAN TRAIL

THE COLOSSUS OF RHODES

BETTY CROCKER

LIBERTY BELL

This is a very small sampling of the parties.  You can find the entire list by clicking the link above.

The 3rd Circuit on Tuesday September 7th handed down a much anticipated decision  dealing with the Governments attempts to get cellular network positioning information  without a warrant (2010 WL 3465170).

The dispute stems from the Governments attempts to obtain cell site location information (CSLI)  regarding a particular subscriber under the Stored Communications Act (18 U.S.C.A. §§ 2701 et seq.).

CSLI is information that cellular providers maintain regarding the location of their customers when they make a call.  Whenever a cellular customer makes a phone call, the cellular providers record what tower transmitted the call, as well as what “face” of the antenna was used to receive the call.

The police argue that this is valuable information for proving that individuals were at certain locations at particular times.  In this case, they requested the information under the Stored Communications Act provision that allows the Government to obtain the information by getting a court order merely upon a showing of the information’s relevance and materiality of the data to an ongoing criminal investigation.  This Act relieves the Government in certain situations of having to get a warrant and show probable cause.

In this case, the lower court refused to grant the order, and in a rare occurrence the order denying the request was joined by the other judges in the district.  The lower court held that the Stored Communication Act did not apply and that the CSLI records could only be obtained upon a showing of probable cause.

The 3rd Circuit here decided that the Stored Communications Act does not necessarily require that Probable Cause be shown in order to obtain this data.  Having decided that the lower court’s decision would not stand, much of the later decision dealt with the Government’s contention that if it met the requisite showing under the Stored Communications Act then the Magistrate must grant the order.  The 3rd Circuit did not agree, in addressing the legislative history they concluded that the magistrate might have discretion to require probable cause and a warrant under some circumstances.  The 3rd Circuit then remanded to the lower court for further consideration.

For more on the Stored Communications Act, see Chapter 9 of Data Security and Privacy Law: Combating Cyberthreats; specifically,  DATASPL § 9:17 et. seq.

Retail giant Abercrombie & Fitch has found itself a recipient of a second lawsuit filed against it by the E.E.O.C. within the past 12 months for refusing to hire a Muslim job applicant because she wore a hijab (religious head scarf).  The most recent case is entitled U.S. Equal Employment Opportunity Commission v. Abercrombie & Fitch, Co. et. al.   The case was filed in the U.S. District Court for the Northern District of California on September 2nd, Case number 5:10-CV-03911, and assigned to Judge Howard Lloyd.  According to the E.E.O.C. press release (2010 WLNR 17415315), in March 2008, an 18-year-old female applied for a job stocking merchandise at the “Abercrombie Kids” store at the Great Mall in Milpitas, Calif. In accordance with her religious beliefs, she wore a colorful headscarf to her interview. According to the EEOC, the Abercrombie & Fitch manager asked if she was Muslim and required to wear a head scarf, then marked “not Abercrombie look” on the young woman’s interview form. The EEOC’s suit alleges that Abercrombie & Fitch refused to accommodate the applicant’s religious beliefs by granting an exception to its “Look Policy,” an internal dress code that includes a prohibition against head coverings.

The first case, EEOC v. Abercrombie & Fitch d.b.a. Abercrombie Kids (Case No. 4:09cv602 in the U.S. District Court for the Northern District of Oklahoma) was filed by the St. Louis District Office of the E.E.O.C. in September 2009. Both cases are premised on Title VII of the Civil Rights Act of 1964 that prohibits discrimination based on religion (42 U.S.C.A. § 2000e-2) , and requires employers to accommodate the sincerely held religious beliefs or practices of employees, unless doing so would impose an undue hardship on the business.

The EEOC press release notes that, “This is not the first wake-up call for Abercrombie & Fitch. In 2005, the company agreed to a six-year consent decree and paid $40 million to a class of African Americans, Asian Americans, Latinos, and women. Why? They were sued by EEOC and private litigants for refusing to recruit, hire, promote, and retain minorities because they did not fit Abercrombie’s ‘All-American look.’

This latest case was filed just days after another Muslim woman from California received national attention for filing a complaint with the U.S. Equal Employment Opportunity Commission against the Walt Disney Company’s Grand Californian Hotel & Spa for not responding to her request to wear a hijab at work.

The EEOC press releases can be found in the EEOCDOCS database.  Try

Query: hijab

Results: 3

EEOC decisions are in FLB-EEOC.

Much has been written about a request by Netflix for rehearing en banc by the Federal Circuit.  Netflix would like to be reheard en banc regarding the recent denial of their request for attorneys fees incurred defending a patent claim (2010 WL 1293379). 

Netflix and BlockBuster among others were sued by Media Queue for supposed patent infringement.  The Northern District of California granted summary judgment for Netflix. 

However the US District Court also denied the request by Netflix for over $1,000,000 in attorneys fees.  Netflix appealed this decision to the Federal Circuit, and after the Federal Circuit at first sided with Media Queue, Netflix has moved for rehearing en banc (672 F.Supp.2d 1022). 

Netflix would like the court to adopt a more liberal standard for awarding attorneys fees, it is hoped that this will act as a deterrent to future baseless patent claims.  Netflix would have the courts apply an “objectively reckless” standard for awarding attorneys fees.

Depending on what the Federal Circuit decides to do with this case, it could end up being very important precedent.  You can set up a Docket Alert to track developments in this case with the docket number 10-1199.

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