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Week 34 (2020)

Week of August 17 through August 21, 2020

United States v. Millender (Motz 8/17/2020): The Fourth Circuit held that, in the context of a wire fraud and money laundering conviction, where there was evidence that the perpetrators of fraudulent activity discussed the risks of their investments and agreed to not inform their lenders of the spending of their loan principal, a reasonable juror could find that a defendant knew that the laundering companies were fraudulent. The court reversed the district court’s grant of the defendant’s motion of a judgment of acquittal as to counts of wire fraud and money laundering, vacated the district court’s grant of the defendant’s motion for a new trial, and remanded the case back to the district court for further proceedings. Full Opinion.

Argueta v. Barr (Rushing 8/18/2020): The Fourth Circuit denied the review of a Board of Immigration Appeals (BIA) order, dismissing the appeal of an order denying a cancellation of removal of a citizen of El Salvador who was a lawful permanent resident of the United States. The Department of Homeland Security sought removal of the petitioner based on two separate drug convictions. The court explained that even though the petitioner was not seeking admission to the country, as he was already a lawful resident, his guilty plea for two drug convictions rendered him “inadmissible”; and thus, because he committed his drug offenses within seven years of his admission to the United States, he was ineligible for cancellation of removal. Therefore, the court denied the petition to review the BIA order. Full Opinion.

United States v. Ward (Richardson 8/20/2020): The Fourth Circuit affirmed the district court’s enhancement of a defendant’s sentence for distribution of cocaine, based on the defendant’s prior conviction controlled substance offenses. The defendant argued that his two prior convictions for possession with intent to distribute heroin in Virginia did not qualify as controlled substances under the Federal Sentencing Guidelines because Virginia law defines controlled substances more broadly than federal law does. To qualify as a “controlled substance offense,” the defendant argued, the controlled substances criminalized under state law must be coextensive with those listed in the federal Controlled Substances Act. But the court disagreed with the defendant, and it held that the prior convictions qualify under the ordinary meaning of “controlled substance offense” in the Federal Controlled Substances Act and the district court correctly counted those convictions as predicate offenses for the sentence enhancement. Full Opinion.

Navy Federal Credit Union v. LTD Financial Services, LP (Richardson 8/20/2020): The Fourth Circuit held that Navy Federal Credit Union, a federally chartered corporation, is a Virginia citizen for diversity jurisdiction purposes. The court reversed the district court’s order and reasoned that the district court’s application of U.S.C. 28 § 1332(c)(1) conflicted with Fourth Circuit precedent. Accordingly, the court reversed the district court’s dismissal of the case for lack of subject-matter jurisdiction. Full Opinion.

This appeal centers on the meaning of a seemingly simple, three-letter word connecting two clauses: and. For establishing diversity jurisdiction, Congress provides that a corporation “shall be deemed a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business.” 28 U.S.C. § 1332(c)(1) (emphasis added). We regularly apply this subsection to your bread-and-butter, state-chartered corporations. But federally chartered corporations (not incorporated in a State or foreign state) do not “fit comfortably” under the first clause.

Navy Federal Credit Union v. LTD Financial Services, LP

Campbell v. Florian (Richardson 8/20/2020): The Fourth Circuit held that the deputy general counsel for the S.C. Department of Corrections was entitled to qualified immunity for a memorandum where the attorney interpreted the Omnibus Act. The government attorney’s interpretation caused an inmate to be denied credits that would have made him eligible for parole and early release. The court reversed the district court’s ruling that the deputy counsel was not entitled to qualified immunity because the meaning of the Omnibus Act was obvious and therefore the inmate’s Eighth Amendment right was clearly established. The court reasoned that, although the deputy counsel’s interpretation of the Omnibus Act was incorrect, the legal error—in interpreting the state law—was not one of deliberate indifference. Accordingly, the court reversed the judgment of the district court and held that the defendant was thus entitled to qualified immunity. Full Opinion.

United States v. Medley (Gregory 8/21/2020): The Fourth Circuit vacated a defendant’s conviction for violation of 18 U.S.C. § 922(g)(1), possession of a firearm by a convicted felon, after finding that the failure to include the knowledge-of-felon-status element in the defendant’s indictment was a plain error affecting the defendant’s substantial rights. The court concluded that the district court’s failure to instruct the jury that it had to find the defendant knew his prohibited status of a felon, and the Government’s failure to present sufficient evidence on that point at trial, was a plain error affecting the defendant’s substantial rights. The court relied on Rehaif v. United States. 139 S. Ct. 2191(2019). In Rehaif, the Supreme Court held that “in a prosecution under 18 U.S.C. §922(g) . . . the government must prove that the defendant knew he possessed a firearm and that he knew he belonged to the relevant category of persons barred from possessing a firearm.” Id. at 2200 (emphasis added). Judge Quattlebaum dissented, arguing the Rehaif errors did not seriously affect the fairness, integrity, or public reputation of the judicial proceedings. Ultimately, the court vacated the defendant’s § 922(g)(1) conviction and remanded the case to the district court with instructions to enter judgment dismissing the conviction without prejudice. Full Opinion.

Robbie Holland