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Name: Commission Regulation (EU) No 267/2010 of 24 March 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to certain categories of agreements, decisions and concerted practices in the insurance sector (Text with EEA relevance) Type: Regulation Subject Matter: competition; insurance; business organisation Date Published: nan
30.3.2010 EN Official Journal of the European Union L 83/1 COMMISSION REGULATION (EU) No 267/2010 of 24 March 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to certain categories of agreements, decisions and concerted practices in the insurance sector (Text with EEA relevance) THE EUROPEAN COMMISSION, Having regard to the Treaty on the Functioning of the European Union, Having regard to Council Regulation (EEC) No 1534/91 of 31 May 1991 on the application of Article 85(3) of the Treaty to certain categories of agreements, decisions and concerted practices in the insurance sector (1), and in particular Article 1(1)(a), (b), (c) and (e) thereof, Having published a draft of this Regulation, After consulting the Advisory Committee on Restrictive Practices and Dominant Positions, Whereas: (1) Regulation (EEC) No 1534/91 empowers the Commission to apply Article 101(3) of the Treaty on the Functioning of the European Union (2) by regulation to certain categories of agreements, decisions and concerted practices in the insurance sector which have as their object cooperation with respect to: the establishment of common risk premium tariffs based on collectively ascertained statistics or the number of claims, the establishment of common standard policy conditions, the common coverage of certain types of risks, the settlement of claims, the testing and acceptance of security devices, registers of, and information on, aggravated risks. (2) Pursuant to Regulation (EEC) No 1534/91, the Commission adopted Regulation (EC) No 358/2003 of 27 February 2003 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices in the insurance sector (3). Regulation (EC) No 358/2003 expires on 31 March 2010. (3) Regulation (EC) No 358/2003 does not grant an exemption to agreements concerning the settlement of claims and registers of, and information on, aggravated risks. The Commission considered that it lacked sufficient experience in handling individual cases to make use of the power conferred by Regulation (EEC) No 1534/91 in those fields. That situation has not changed. Furthermore, although Regulation (EC) No 358/2003 granted an exemption for the establishment of standard policy conditions and the testing and acceptance of security devices, this Regulation should not do so since the Commissions review of the functioning of Regulation (EC) No 358/2003 revealed that it was no longer necessary to include such agreements in a sector specific block exemption regulation. In the context where those two categories of agreements are not specific to the insurance sector and, as the review showed, can also give rise to certain competition concerns, it is more appropriate that they be subject to self-assessment. (4) Following a public consultation launched on 17 April 2008, the Commission adopted a report to the European Parliament and the Council on the functioning of Regulation (EC) No 358/2003 (the Report) (4) on 24 March 2009. In the Report and its accompanying Working Document (the Working Document) preliminary amendments of Regulation (EC) No 358/2003 were proposed. On 2 June 2009, the Commission held a public meeting with interested parties, including representatives of the insurance sector, consumer organisations and national competition authorities, on the findings and proposals in the Report and Working Document. (5) This Regulation should ensure effective protection of competition while providing benefits to consumers and adequate legal security for undertakings. The pursuit of those objectives should take account of the Commissions experience in this field, and the results of the consultations leading up to the adoption of this Regulation. (6) Regulation (EEC) No 1534/91 requires the exempting regulation of the Commission to define the categories of agreements, decisions and concerted practices to which it applies, to specify the restrictions or clauses which may, or may not, appear in the agreements, decisions and concerted practices, and to specify the clauses which must be contained in the agreements, decisions and concerted practices or the other conditions which must be satisfied. (7) Nevertheless, it is appropriate to continue the approach taken in Regulation (EC) No 358/2003 of placing the emphasis on defining categories of agreements which are exempted up to a certain level of market share and on specifying the restrictions or clauses which are not to be contained in such agreements. (8) The benefit of the block exemption established by this Regulation should be limited to those agreements which can be assumed with sufficient certainty to satisfy the conditions of Article 101(3) of the Treaty. For the application of Article 101(3) of the Treaty by regulation, it is not necessary to define those agreements which are capable of falling within Article 101(1) of the Treaty. At the same time, there is no presumption that agreements which do not benefit from this Regulation are either caught by Article 101(1) of the Treaty or that they fail to satisfy the conditions of Article 101(3) of the Treaty. In the individual assessment of agreements under Article 101(1) of the Treaty, account must be taken of several factors, and in particular the market structure on the relevant market. (9) Collaboration between insurance undertakings or within associations of undertakings in the compilation of information (which may also involve some statistical calculations) allowing the calculation of the average cost of covering a specified risk in the past or, for life insurance, tables of mortality rates or of the frequency of illness, accident and invalidity, makes it possible to improve the knowledge of risks and facilitates the rating of risks for individual companies. This can in turn facilitate market entry and thus benefit consumers. The same applies to joint studies on the probable impact of extraneous circumstances that may influence the frequency or scale of claims, or the yield of different types of investments. It is, however, necessary to ensure that such collaboration is only exempted to the extent to which it is necessary to attain these objectives. It is therefore appropriate to stipulate in particular that agreements on commercial premiums are not exempted. Indeed, commercial premiums may be lower than the amounts indicated by the compilations, tables or study results in question, since insurers can use the revenues from their investments in order to reduce their premiums. Moreover, the compilations, tables or studies in question should be non-binding and serve only for reference purposes. The exchange of information not necessary to attain the objectives set out in this recital should not be covered by this Regulation. (10) Moreover, the narrower the categories into which statistics on the cost of covering a specified risk in the past are grouped, the more leeway insurance undertakings have to differentiate their commercial premiums when they calculate them. It is therefore appropriate to exempt joint compilations of the past cost of risks on condition that the available statistics are provided with as much detail and differentiation as is actuarially adequate. (11) Furthermore, access to the joint compilations, tables and study results is necessary both for insurance undertakings active on the geographic or product market in question and for those considering entering that market. Similarly access to such compilations, tables and study results may be of value to consumer organisations or customer organisations. Insurance undertakings not yet active on the market in question and consumer or customer organisations must be granted access to such compilations, tables and study results on reasonable, affordable and non-discriminatory terms, as compared with insurance undertakings already present on that market. Such terms might for example include a commitment from an insurance undertaking not yet present on the market to provide statistical information on claims, should it ever enter the market and might also include membership of the association of insurers responsible for producing the compilations. An exception to the requirement to grant access to consumer organisations and customer organisations should be possible on the grounds of public security, for example where the information relates to the security systems of nuclear plants or the weakness of flood prevention systems. (12) The reliability of joint compilations, tables and studies becomes greater as the amount of statistics on which they are based is increased. Insurers with high market shares may generate sufficient statistics internally to be able to make reliable compilations, but those with small market shares may not be able to do so, and new entrants are even less likely to be able to generate such statistics. The inclusion in such joint compilations, tables and studies of information from all insurers on a market, including large ones, in principle promotes competition by helping smaller insurers, and facilitates market entry. Given this specificity of the insurance sector, it is not appropriate to subject any exemption for such joint compilations, tables and studies to market share thresholds. (13) Co-insurance or co-reinsurance pools can, in certain limited circumstances, be necessary to allow the participating undertakings of a pool to provide insurance or reinsurance for risks for which they might only offer insufficient cover in the absence of the pool. Those types of pools do not generally give rise to a restriction of competition under Article 101(1) of the Treaty and are thus not prohibited by it. (14) Co-insurance or co-reinsurance pools can allow insurers and reinsurers to provide insurance or reinsurance for risks even if pooling goes beyond what is necessary to ensure that such a risk is covered. However, such pools can involve restrictions of competition, such as the standardisation of policy conditions and even of amounts of cover and premiums. It is therefore appropriate to lay down the circumstances in which such pools can benefit from exemption. (15) For genuinely new risks it is not possible to know in advance what subscription capacity is necessary to cover the risk, nor whether two or more pools could co-exist for the purposes of providing the specific type of insurance concerned. A pooling arrangement offering the co-insurance or co-reinsurance of such new risks can therefore be exempted for a limited period of time without a market share threshold. Three years should constitute an adequate period for the constitution of sufficient historical information on claims to assess the necessity or otherwise of a pool. (16) Risks which did not previously exist should be considered as new risks. However, in exceptional circumstances, a risk may be considered as a new risk where an objective analysis indicates that the nature of the risk has changed so materially that it is not possible to know in advance what subscription capacity is necessary in order to cover such a risk. (17) For risks which are not new, co-insurance and co-reinsurance pools which involve a restriction of competition may, in certain limited circumstances, involve benefits so as to justify an exemption under Article 101(3) of the Treaty, even if they could be replaced by two or more competing insurance entities. They may, for example, allow their participating undertakings to gain the necessary experience of the sector of insurance involved, or they may allow cost savings, or reduction of commercial premiums through joint reinsurance on advantageous terms. However, any exemption should be limited to agreements which do not afford the undertakings involved the possibility of eliminating competition in respect of a substantial part of the products in question. Consumers can benefit effectively from pools only if there is sufficient competition in the relevant markets in which the pools operate. This condition should be regarded as being met when the market share of a pool remains below a given threshold and can therefore be presumed to be subject to actual or potential competition from undertakings which are not participating in that pool. (18) This Regulation should therefore grant an exemption to any such co-insurance or co-reinsurance pool which has existed for more than three years, or which is not created in order to cover a new risk, on condition that the combined market share held by the participating undertakings does not exceed certain thresholds. The threshold for co-insurance pools should be lower because co-insurance pools may involve uniform policy conditions and commercial premiums. For the assessment of whether a pool fulfils the market share condition, the overall market share of the participating undertakings should be aggregated. The market share of each participating undertaking is based on the overall gross premium income of that participating undertaking both within and outside that pool in the same relevant market. These exemptions however should only apply if the pool in question meets the further conditions laid down in this Regulation, which are intended to keep to a minimum the restrictions of competition between the participating undertakings of the pool. An individual analysis would be necessary in such cases, in order to determine whether or not the conditions set out in this Regulation are fulfilled. (19) In order to facilitate the conclusion of agreements, some of which can involve significant investment decisions, the period of validity of this Regulation should be fixed at seven years. (20) The Commission may withdraw the benefit of this Regulation, pursuant to Article 29(1) of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty (5), where it finds in a particular case that an agreement to which the exemptions provided for in this Regulation apply nevertheless has effects which are incompatible with Article 101(3) of the Treaty. (21) The competition authority of a Member State may withdraw the benefit of this Regulation pursuant to Article 29(2) of Regulation (EC) No 1/2003 in respect of the territory of that Member State, or a part thereof where, in a particular case, an agreement to which the exemptions provided for in this Regulation apply nevertheless has effects which are incompatible with Article 101(3) of the Treaty in the territory of that Member State, or in a part thereof, and where such territory has all the characteristics of a distinct geographic market. (22) In determining whether the benefit of this Regulation should be withdrawn pursuant to Article 29 of Regulation (EC) No 1/2003, the anti-competitive effects that may derive from the existence of links between a co-insurance or co-reinsurance pool and/or its participating undertakings and other pools and/or their participating undertakings on the same relevant market are of particular importance, HAS ADOPTED THIS REGULATION: CHAPTER I DEFINITIONS Article 1 Definitions For the purposes of this Regulation, the following definitions shall apply: 1. agreement means an agreement, a decision of an association of undertakings or a concerted practice; 2. participating undertakings means undertakings party to the agreement and their respective connected undertakings; 3. connected undertakings means: (a) undertakings in which a party to the agreement, directly or indirectly: (i) has the power to exercise more than half the voting rights; or (ii) has the power to appoint more than half the members of the supervisory board, board of management or bodies legally representing the undertaking; or (iii) has the right to manage the undertakings affairs; (b) undertakings which directly or indirectly have, over a party to the agreement, the rights or powers listed in point (a); (c) undertakings in which an undertaking referred to in point (b) has, directly or indirectly, the rights or powers listed in point (a); (d) undertakings in which a party to the agreement together with one or more of the undertakings referred to in points (a), (b) or (c), or in which two or more of the latter undertakings, jointly have the rights or powers listed in point (a); (e) undertakings in which the rights or powers listed in point (a) are jointly held by: (i) parties to the agreement or their respective connected undertakings referred to in points (a) to (d); or (ii) one or more of the parties to the agreement or one or more of their connected undertakings referred to in points (a) to (d) and one or more third parties; 4. co-insurance pools means groups set up by insurance undertakings either directly or through brokers or authorised agents, with the exception of ad-hoc co-insurance agreements on the subscription market, whereby a certain part of a given risk is covered by a lead insurer and the remaining part of the risk is covered by follow insurers who are invited to cover that remainder, which: (a) agree to underwrite, in the name and for the account of all the participants, the insurance of a specified risk category; or (b) entrust the underwriting and management of the insurance of a specified risk category, in their name and on their behalf, to one of the insurance undertakings, to a common broker or to a common body set up for this purpose; 5. co-reinsurance pools means groups set up by insurance undertakings either directly or through broker or authorised agents, possibly with the assistance of one or more reinsurance undertakings, with the exception of ad-hoc co-reinsurance agreements on the subscription market, whereby a certain part of a given risk is covered by a lead insurer and the remaining part of this risk is covered by follow insurers who are then invited to cover that remainder in order to: (a) reinsure mutually all or part of their liabilities in respect of a specified risk category; (b) incidentally accept, in the name and on behalf of all the participants, the reinsurance of the same category of risks; 6. new risks means: (a) risks which did not previously exist, and for which insurance cover requires the development of an entirely new insurance product, not involving an extension, improvement or replacement of an existing insurance product; or (b) in exceptional cases, risks the nature of which has, on the basis of an objective analysis, changed so materially that it is not possible to know in advance what subscription capacity is necessary in order to cover such a risk; 7. commercial premium means the price which is charged to the purchaser of an insurance policy. CHAPTER II JOINT COMPILATIONS, TABLES, AND STUDIES Article 2 Exemption Pursuant to Article 101(3) of the Treaty and subject to the provisions of this Regulation, Article 101(1) of the Treaty shall not apply to agreements entered into between two or more undertakings in the insurance sector with respect to: (a) the joint compilation and distribution of information necessary for the following purposes: (i) calculation of the average cost of covering a specified risk in the past (hereinafter compilations); (ii) construction of mortality tables, and tables showing the frequency of illness, accident and invalidity in connection with insurance involving an element of capitalisation (hereinafter tables); (b) the joint carrying-out of studies on the probable impact of general circumstances external to the interested undertakings, either on the frequency or scale of future claims for a given risk or risk category or on the profitability of different types of investment (hereinafter studies), and the distribution of the results of such studies. Article 3 Conditions for exemption 1. The exemption provided for in Article 2(a) shall apply on condition that the compilations or tables: (a) are based on the assembly of data, spread over a number of risk years chosen as an observation period, which relate to identical or comparable risks in sufficient numbers to constitute a base which can be handled statistically and which will yield figures on the following, amongst others: (i) the number of claims during the said period; (ii) the number of individual risks insured in each risk year of the chosen observation period; (iii) the total amounts paid or payable in respect of claims that have arisen during the said period; (iv) the total amount of capital insured for each risk year during the chosen observation period; (b) include as detailed a breakdown of the available statistics as is actuarially adequate; (c) do not include in any way elements for contingencies, income deriving from reserves, administrative or commercial costs or fiscal or parafiscal contributions, and take into account neither revenues from investments nor anticipated profits. 2. The exemptions provided for in Article 2 shall apply on condition that the compilations, tables or study results: (a) do not identify the insurance undertakings concerned or any insured party; (b) when compiled and distributed, include a statement that they are non-binding; (c) do not contain any indication of the level of commercial premiums; (d) are made available on reasonable, affordable and non-discriminatory terms, to any insurance undertaking which requests a copy of them, including insurance undertakings which are not active on the geographic or product market to which those compilations, tables or study results refer; (e) except where non-disclosure is objectively justified on grounds of public security, are made available on reasonable, affordable and non-discriminatory terms, to consumer organisations or customer organisations which request access to them in specific and precise terms for a duly justified reason. Article 4 Agreements not covered by the exemption The exemptions provided for in Article 2 shall not apply where participating undertakings enter into an undertaking or commitment among themselves, or oblige other undertakings, not to use compilations or tables that differ from those referred to in Article 2(a), or not to depart from the results of the studies referred to in Article 2(b). CHAPTER III COMMON COVERAGE OF CERTAIN TYPES OF RISKS Article 5 Exemption Pursuant to Article 101(3) of the Treaty and subject to the provisions of this Regulation, Article 101(1) of the Treaty shall not apply to agreements entered into between two or more undertakings in the insurance sector with respect to the setting-up and operation of pools of insurance undertakings or of insurance undertakings and reinsurance undertakings for the common coverage of a specific category of risks in the form of co-insurance or co-reinsurance. Article 6 Application of exemption and market share thresholds 1. As concerns co-insurance or co-reinsurance pools which are created in order exclusively to cover new risks, the exemption provided for in Article 5 shall apply for a period of three years from the date of the first establishment of the pool, regardless of the market share of the pool. 2. As concerns co-insurance or co-reinsurance pools which do not fall within the scope of paragraph 1, the exemption provided for in Article 5 shall apply as long as this Regulation remains in force, on condition that the combined market share held by the participating undertakings does not exceed: (a) in the case of co-insurance pools, 20 % of any relevant market; (b) in the case of co-reinsurance pools, 25 % of any relevant market. 3. In calculating the market share of a participating undertaking on the relevant market, account shall be taken of: (a) the market share of the participating undertaking within the pool in question; (b) the market share of the participating undertaking within another pool on the same relevant market as the pool in question, to which the participating undertaking is a party; and (c) the market share of the participating undertaking on the same relevant market as the pool in question, outside any pool. 4. For the purposes of applying the market share thresholds provided for in paragraph 2, the following rules shall apply: (a) the market share shall be calculated on the basis of gross premium income; if gross premium income data are not available, estimates based on other reliable market information, including insurance cover provided or insured risk value, may be used to establish the market share of the undertaking concerned; (b) the market share shall be calculated on the basis of data relating to the preceding calendar year. 5. Where the market share referred to in paragraph 2(a) is initially not more than 20 % but subsequently rises above that level without exceeding 25 %, the exemption provided for in Article 5 shall continue to apply for a period of two consecutive calendar years following the year in which the 20 % threshold was first exceeded. 6. Where the market share referred to in paragraph 2(a) is initially not more than 20 % but subsequently rises above 25 %, the exemption provided for in Article 5 shall continue to apply for a period of one calendar year following the year in which the level of 25 % was first exceeded. 7. The benefit of paragraphs 5 and 6 may not be combined so as to exceed a period of two calendar years. 8. Where the market share referred to in paragraph 2(b) is initially not more than 25 % but subsequently rises above that level without exceeding 30 %, the exemption provided for in Article 5 shall continue to apply for a period of two consecutive calendar years following the year in which the 25 % threshold was first exceeded. 9. Where the market share referred to in paragraph 2(b) is initially not more than 25 % but subsequently rises above 30 %, the exemption provided for in Article 5 shall continue to apply for a period of one calendar year following the year in which the level of 30 % was first exceeded. 10. The benefit of paragraphs 8 and 9 may not be combined so as to exceed a period of two calendar years. Article 7 Conditions for exemption The exemption provided for in Article 5 shall apply on condition that: (a) each participating undertaking having given a reasonable period of notice has the right to withdraw from the pool, without incurring any sanctions; (b) the rules of the pool do not oblige any participating undertaking of the pool to insure or reinsure through the pool and do not restrict any participating undertaking of the pool from insuring or reinsuring outside the pool, in whole or in part, any risk of the type covered by the pool; (c) the rules of the pool do not restrict the activity of the pool or its participating undertakings to the insurance or reinsurance of risks located in any particular geographical part of the Union; (d) the agreement does not limit output or sales; (e) the agreement does not allocate markets or customers; and (f) the participating undertakings of a co-reinsurance pool do not agree on the commercial premiums which they charge for direct insurance. CHAPTER IV FINAL PROVISIONS Article 8 Transitional period The prohibition laid down in Article 101(1) of the Treaty shall not apply during the period from 1 April 2010 to 30 September 2010 in respect of agreements already in force on 31 March 2010 which do not satisfy the conditions for exemption provided for in this Regulation but which satisfy the conditions for exemption provided for in Regulation (EC) No 358/2003. Article 9 Period of validity This Regulation shall enter into force on 1 April 2010. It shall expire on 31 March 2017. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 24 March 2010. For the Commission The President Josà © Manuel BARROSO (1) OJ L 143, 7.6.1991, p. 1. (2) With effect from 1 December 2009, Article 81 of the EC Treaty has become Article 101 of the Treaty on the Functioning of the European Union. The two articles are, in substance, identical. For the purposes of this Regulation, references to Article 101 of the Treaty on the Functioning of the European Union should be understood as references to Article 81 of the EC Treaty where appropriate. (3) OJ L 53, 28.2.2003, p. 8. (4) COM(2009) 138. (5) OJ L 1, 4.1.2003, p. 1. | nan | [
"Name: Commission Regulation (EU) No 267/2010 of 24 March 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to certain categories of agreements, decisions and concerted practices in the insurance sector (Text with EEA relevance) Type: Regulation Subject Matter: competition; insurance; business organisation Date Published: nan 30.3.2010 EN Official Journal of the European Union L 83/1 COMMISSION REGULATION (EU) No 267/2010 of 24 March 2010 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to certain categories of agreements, decisions and concerted practices in the insurance sector (Text with EEA relevance) THE EUROPEAN COMMISSION, Having regard to the Treaty on the Functioning of the European Union, Having regard to Council Regulation (EEC) No 1534/91 of 31 May 1991 on the application of Article 85(3) of the Treaty to certain categories of agreements, decisions and concerted practices in the insurance sector (1), and in particular Article 1(1)(a), (b), (c) and (e) thereof, Having published a draft of this Regulation, After consulting the Advisory Committee on Restrictive Practices and Dominant Positions, Whereas: (1) Regulation (EEC) No 1534/91 empowers the Commission to apply Article 101(3) of the Treaty on the Functioning of the European Union (2) by regulation to certain categories of agreements, decisions and concerted practices in the insurance sector which have as their object cooperation with respect to: the establishment of common risk premium tariffs based on collectively ascertained statistics or the number of claims, the establishment of common standard policy conditions, the common coverage of certain types of risks, the settlement of claims, the testing and acceptance of security devices, registers of, and information on, aggravated risks.",
"(2) Pursuant to Regulation (EEC) No 1534/91, the Commission adopted Regulation (EC) No 358/2003 of 27 February 2003 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices in the insurance sector (3). Regulation (EC) No 358/2003 expires on 31 March 2010. (3) Regulation (EC) No 358/2003 does not grant an exemption to agreements concerning the settlement of claims and registers of, and information on, aggravated risks. The Commission considered that it lacked sufficient experience in handling individual cases to make use of the power conferred by Regulation (EEC) No 1534/91 in those fields. That situation has not changed. Furthermore, although Regulation (EC) No 358/2003 granted an exemption for the establishment of standard policy conditions and the testing and acceptance of security devices, this Regulation should not do so since the Commissions review of the functioning of Regulation (EC) No 358/2003 revealed that it was no longer necessary to include such agreements in a sector specific block exemption regulation. In the context where those two categories of agreements are not specific to the insurance sector and, as the review showed, can also give rise to certain competition concerns, it is more appropriate that they be subject to self-assessment.",
"(4) Following a public consultation launched on 17 April 2008, the Commission adopted a report to the European Parliament and the Council on the functioning of Regulation (EC) No 358/2003 (the Report) (4) on 24 March 2009. In the Report and its accompanying Working Document (the Working Document) preliminary amendments of Regulation (EC) No 358/2003 were proposed. On 2 June 2009, the Commission held a public meeting with interested parties, including representatives of the insurance sector, consumer organisations and national competition authorities, on the findings and proposals in the Report and Working Document. (5) This Regulation should ensure effective protection of competition while providing benefits to consumers and adequate legal security for undertakings. The pursuit of those objectives should take account of the Commissions experience in this field, and the results of the consultations leading up to the adoption of this Regulation.",
"(6) Regulation (EEC) No 1534/91 requires the exempting regulation of the Commission to define the categories of agreements, decisions and concerted practices to which it applies, to specify the restrictions or clauses which may, or may not, appear in the agreements, decisions and concerted practices, and to specify the clauses which must be contained in the agreements, decisions and concerted practices or the other conditions which must be satisfied. (7) Nevertheless, it is appropriate to continue the approach taken in Regulation (EC) No 358/2003 of placing the emphasis on defining categories of agreements which are exempted up to a certain level of market share and on specifying the restrictions or clauses which are not to be contained in such agreements. (8) The benefit of the block exemption established by this Regulation should be limited to those agreements which can be assumed with sufficient certainty to satisfy the conditions of Article 101(3) of the Treaty. For the application of Article 101(3) of the Treaty by regulation, it is not necessary to define those agreements which are capable of falling within Article 101(1) of the Treaty.",
"At the same time, there is no presumption that agreements which do not benefit from this Regulation are either caught by Article 101(1) of the Treaty or that they fail to satisfy the conditions of Article 101(3) of the Treaty. In the individual assessment of agreements under Article 101(1) of the Treaty, account must be taken of several factors, and in particular the market structure on the relevant market. (9) Collaboration between insurance undertakings or within associations of undertakings in the compilation of information (which may also involve some statistical calculations) allowing the calculation of the average cost of covering a specified risk in the past or, for life insurance, tables of mortality rates or of the frequency of illness, accident and invalidity, makes it possible to improve the knowledge of risks and facilitates the rating of risks for individual companies. This can in turn facilitate market entry and thus benefit consumers. The same applies to joint studies on the probable impact of extraneous circumstances that may influence the frequency or scale of claims, or the yield of different types of investments.",
"It is, however, necessary to ensure that such collaboration is only exempted to the extent to which it is necessary to attain these objectives. It is therefore appropriate to stipulate in particular that agreements on commercial premiums are not exempted. Indeed, commercial premiums may be lower than the amounts indicated by the compilations, tables or study results in question, since insurers can use the revenues from their investments in order to reduce their premiums. Moreover, the compilations, tables or studies in question should be non-binding and serve only for reference purposes. The exchange of information not necessary to attain the objectives set out in this recital should not be covered by this Regulation. (10) Moreover, the narrower the categories into which statistics on the cost of covering a specified risk in the past are grouped, the more leeway insurance undertakings have to differentiate their commercial premiums when they calculate them.",
"It is therefore appropriate to exempt joint compilations of the past cost of risks on condition that the available statistics are provided with as much detail and differentiation as is actuarially adequate. (11) Furthermore, access to the joint compilations, tables and study results is necessary both for insurance undertakings active on the geographic or product market in question and for those considering entering that market. Similarly access to such compilations, tables and study results may be of value to consumer organisations or customer organisations. Insurance undertakings not yet active on the market in question and consumer or customer organisations must be granted access to such compilations, tables and study results on reasonable, affordable and non-discriminatory terms, as compared with insurance undertakings already present on that market. Such terms might for example include a commitment from an insurance undertaking not yet present on the market to provide statistical information on claims, should it ever enter the market and might also include membership of the association of insurers responsible for producing the compilations. An exception to the requirement to grant access to consumer organisations and customer organisations should be possible on the grounds of public security, for example where the information relates to the security systems of nuclear plants or the weakness of flood prevention systems.",
"(12) The reliability of joint compilations, tables and studies becomes greater as the amount of statistics on which they are based is increased. Insurers with high market shares may generate sufficient statistics internally to be able to make reliable compilations, but those with small market shares may not be able to do so, and new entrants are even less likely to be able to generate such statistics. The inclusion in such joint compilations, tables and studies of information from all insurers on a market, including large ones, in principle promotes competition by helping smaller insurers, and facilitates market entry.",
"Given this specificity of the insurance sector, it is not appropriate to subject any exemption for such joint compilations, tables and studies to market share thresholds. (13) Co-insurance or co-reinsurance pools can, in certain limited circumstances, be necessary to allow the participating undertakings of a pool to provide insurance or reinsurance for risks for which they might only offer insufficient cover in the absence of the pool. Those types of pools do not generally give rise to a restriction of competition under Article 101(1) of the Treaty and are thus not prohibited by it. (14) Co-insurance or co-reinsurance pools can allow insurers and reinsurers to provide insurance or reinsurance for risks even if pooling goes beyond what is necessary to ensure that such a risk is covered. However, such pools can involve restrictions of competition, such as the standardisation of policy conditions and even of amounts of cover and premiums.",
"It is therefore appropriate to lay down the circumstances in which such pools can benefit from exemption. (15) For genuinely new risks it is not possible to know in advance what subscription capacity is necessary to cover the risk, nor whether two or more pools could co-exist for the purposes of providing the specific type of insurance concerned. A pooling arrangement offering the co-insurance or co-reinsurance of such new risks can therefore be exempted for a limited period of time without a market share threshold. Three years should constitute an adequate period for the constitution of sufficient historical information on claims to assess the necessity or otherwise of a pool. (16) Risks which did not previously exist should be considered as new risks.",
"However, in exceptional circumstances, a risk may be considered as a new risk where an objective analysis indicates that the nature of the risk has changed so materially that it is not possible to know in advance what subscription capacity is necessary in order to cover such a risk. (17) For risks which are not new, co-insurance and co-reinsurance pools which involve a restriction of competition may, in certain limited circumstances, involve benefits so as to justify an exemption under Article 101(3) of the Treaty, even if they could be replaced by two or more competing insurance entities. They may, for example, allow their participating undertakings to gain the necessary experience of the sector of insurance involved, or they may allow cost savings, or reduction of commercial premiums through joint reinsurance on advantageous terms. However, any exemption should be limited to agreements which do not afford the undertakings involved the possibility of eliminating competition in respect of a substantial part of the products in question. Consumers can benefit effectively from pools only if there is sufficient competition in the relevant markets in which the pools operate. This condition should be regarded as being met when the market share of a pool remains below a given threshold and can therefore be presumed to be subject to actual or potential competition from undertakings which are not participating in that pool. (18) This Regulation should therefore grant an exemption to any such co-insurance or co-reinsurance pool which has existed for more than three years, or which is not created in order to cover a new risk, on condition that the combined market share held by the participating undertakings does not exceed certain thresholds.",
"The threshold for co-insurance pools should be lower because co-insurance pools may involve uniform policy conditions and commercial premiums. For the assessment of whether a pool fulfils the market share condition, the overall market share of the participating undertakings should be aggregated. The market share of each participating undertaking is based on the overall gross premium income of that participating undertaking both within and outside that pool in the same relevant market. These exemptions however should only apply if the pool in question meets the further conditions laid down in this Regulation, which are intended to keep to a minimum the restrictions of competition between the participating undertakings of the pool. An individual analysis would be necessary in such cases, in order to determine whether or not the conditions set out in this Regulation are fulfilled. (19) In order to facilitate the conclusion of agreements, some of which can involve significant investment decisions, the period of validity of this Regulation should be fixed at seven years. (20) The Commission may withdraw the benefit of this Regulation, pursuant to Article 29(1) of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty (5), where it finds in a particular case that an agreement to which the exemptions provided for in this Regulation apply nevertheless has effects which are incompatible with Article 101(3) of the Treaty. (21) The competition authority of a Member State may withdraw the benefit of this Regulation pursuant to Article 29(2) of Regulation (EC) No 1/2003 in respect of the territory of that Member State, or a part thereof where, in a particular case, an agreement to which the exemptions provided for in this Regulation apply nevertheless has effects which are incompatible with Article 101(3) of the Treaty in the territory of that Member State, or in a part thereof, and where such territory has all the characteristics of a distinct geographic market.",
"(22) In determining whether the benefit of this Regulation should be withdrawn pursuant to Article 29 of Regulation (EC) No 1/2003, the anti-competitive effects that may derive from the existence of links between a co-insurance or co-reinsurance pool and/or its participating undertakings and other pools and/or their participating undertakings on the same relevant market are of particular importance, HAS ADOPTED THIS REGULATION: CHAPTER I DEFINITIONS Article 1 Definitions For the purposes of this Regulation, the following definitions shall apply: 1. agreement means an agreement, a decision of an association of undertakings or a concerted practice; 2. participating undertakings means undertakings party to the agreement and their respective connected undertakings; 3. connected undertakings means: (a) undertakings in which a party to the agreement, directly or indirectly: (i) has the power to exercise more than half the voting rights; or (ii) has the power to appoint more than half the members of the supervisory board, board of management or bodies legally representing the undertaking; or (iii) has the right to manage the undertakings affairs; (b) undertakings which directly or indirectly have, over a party to the agreement, the rights or powers listed in point (a); (c) undertakings in which an undertaking referred to in point (b) has, directly or indirectly, the rights or powers listed in point (a); (d) undertakings in which a party to the agreement together with one or more of the undertakings referred to in points (a), (b) or (c), or in which two or more of the latter undertakings, jointly have the rights or powers listed in point (a); (e) undertakings in which the rights or powers listed in point (a) are jointly held by: (i) parties to the agreement or their respective connected undertakings referred to in points (a) to (d); or (ii) one or more of the parties to the agreement or one or more of their connected undertakings referred to in points (a) to (d) and one or more third parties; 4. co-insurance pools means groups set up by insurance undertakings either directly or through brokers or authorised agents, with the exception of ad-hoc co-insurance agreements on the subscription market, whereby a certain part of a given risk is covered by a lead insurer and the remaining part of the risk is covered by follow insurers who are invited to cover that remainder, which: (a) agree to underwrite, in the name and for the account of all the participants, the insurance of a specified risk category; or (b) entrust the underwriting and management of the insurance of a specified risk category, in their name and on their behalf, to one of the insurance undertakings, to a common broker or to a common body set up for this purpose; 5. co-reinsurance pools means groups set up by insurance undertakings either directly or through broker or authorised agents, possibly with the assistance of one or more reinsurance undertakings, with the exception of ad-hoc co-reinsurance agreements on the subscription market, whereby a certain part of a given risk is covered by a lead insurer and the remaining part of this risk is covered by follow insurers who are then invited to cover that remainder in order to: (a) reinsure mutually all or part of their liabilities in respect of a specified risk category; (b) incidentally accept, in the name and on behalf of all the participants, the reinsurance of the same category of risks; 6. new risks means: (a) risks which did not previously exist, and for which insurance cover requires the development of an entirely new insurance product, not involving an extension, improvement or replacement of an existing insurance product; or (b) in exceptional cases, risks the nature of which has, on the basis of an objective analysis, changed so materially that it is not possible to know in advance what subscription capacity is necessary in order to cover such a risk; 7. commercial premium means the price which is charged to the purchaser of an insurance policy.",
"CHAPTER II JOINT COMPILATIONS, TABLES, AND STUDIES Article 2 Exemption Pursuant to Article 101(3) of the Treaty and subject to the provisions of this Regulation, Article 101(1) of the Treaty shall not apply to agreements entered into between two or more undertakings in the insurance sector with respect to: (a) the joint compilation and distribution of information necessary for the following purposes: (i) calculation of the average cost of covering a specified risk in the past (hereinafter compilations); (ii) construction of mortality tables, and tables showing the frequency of illness, accident and invalidity in connection with insurance involving an element of capitalisation (hereinafter tables); (b) the joint carrying-out of studies on the probable impact of general circumstances external to the interested undertakings, either on the frequency or scale of future claims for a given risk or risk category or on the profitability of different types of investment (hereinafter studies), and the distribution of the results of such studies. Article 3 Conditions for exemption 1. The exemption provided for in Article 2(a) shall apply on condition that the compilations or tables: (a) are based on the assembly of data, spread over a number of risk years chosen as an observation period, which relate to identical or comparable risks in sufficient numbers to constitute a base which can be handled statistically and which will yield figures on the following, amongst others: (i) the number of claims during the said period; (ii) the number of individual risks insured in each risk year of the chosen observation period; (iii) the total amounts paid or payable in respect of claims that have arisen during the said period; (iv) the total amount of capital insured for each risk year during the chosen observation period; (b) include as detailed a breakdown of the available statistics as is actuarially adequate; (c) do not include in any way elements for contingencies, income deriving from reserves, administrative or commercial costs or fiscal or parafiscal contributions, and take into account neither revenues from investments nor anticipated profits.",
"2. The exemptions provided for in Article 2 shall apply on condition that the compilations, tables or study results: (a) do not identify the insurance undertakings concerned or any insured party; (b) when compiled and distributed, include a statement that they are non-binding; (c) do not contain any indication of the level of commercial premiums; (d) are made available on reasonable, affordable and non-discriminatory terms, to any insurance undertaking which requests a copy of them, including insurance undertakings which are not active on the geographic or product market to which those compilations, tables or study results refer; (e) except where non-disclosure is objectively justified on grounds of public security, are made available on reasonable, affordable and non-discriminatory terms, to consumer organisations or customer organisations which request access to them in specific and precise terms for a duly justified reason. Article 4 Agreements not covered by the exemption The exemptions provided for in Article 2 shall not apply where participating undertakings enter into an undertaking or commitment among themselves, or oblige other undertakings, not to use compilations or tables that differ from those referred to in Article 2(a), or not to depart from the results of the studies referred to in Article 2(b). CHAPTER III COMMON COVERAGE OF CERTAIN TYPES OF RISKS Article 5 Exemption Pursuant to Article 101(3) of the Treaty and subject to the provisions of this Regulation, Article 101(1) of the Treaty shall not apply to agreements entered into between two or more undertakings in the insurance sector with respect to the setting-up and operation of pools of insurance undertakings or of insurance undertakings and reinsurance undertakings for the common coverage of a specific category of risks in the form of co-insurance or co-reinsurance.",
"Article 6 Application of exemption and market share thresholds 1. As concerns co-insurance or co-reinsurance pools which are created in order exclusively to cover new risks, the exemption provided for in Article 5 shall apply for a period of three years from the date of the first establishment of the pool, regardless of the market share of the pool. 2. As concerns co-insurance or co-reinsurance pools which do not fall within the scope of paragraph 1, the exemption provided for in Article 5 shall apply as long as this Regulation remains in force, on condition that the combined market share held by the participating undertakings does not exceed: (a) in the case of co-insurance pools, 20 % of any relevant market; (b) in the case of co-reinsurance pools, 25 % of any relevant market. 3. In calculating the market share of a participating undertaking on the relevant market, account shall be taken of: (a) the market share of the participating undertaking within the pool in question; (b) the market share of the participating undertaking within another pool on the same relevant market as the pool in question, to which the participating undertaking is a party; and (c) the market share of the participating undertaking on the same relevant market as the pool in question, outside any pool.",
"4. For the purposes of applying the market share thresholds provided for in paragraph 2, the following rules shall apply: (a) the market share shall be calculated on the basis of gross premium income; if gross premium income data are not available, estimates based on other reliable market information, including insurance cover provided or insured risk value, may be used to establish the market share of the undertaking concerned; (b) the market share shall be calculated on the basis of data relating to the preceding calendar year. 5. Where the market share referred to in paragraph 2(a) is initially not more than 20 % but subsequently rises above that level without exceeding 25 %, the exemption provided for in Article 5 shall continue to apply for a period of two consecutive calendar years following the year in which the 20 % threshold was first exceeded. 6. Where the market share referred to in paragraph 2(a) is initially not more than 20 % but subsequently rises above 25 %, the exemption provided for in Article 5 shall continue to apply for a period of one calendar year following the year in which the level of 25 % was first exceeded. 7. The benefit of paragraphs 5 and 6 may not be combined so as to exceed a period of two calendar years.",
"8. Where the market share referred to in paragraph 2(b) is initially not more than 25 % but subsequently rises above that level without exceeding 30 %, the exemption provided for in Article 5 shall continue to apply for a period of two consecutive calendar years following the year in which the 25 % threshold was first exceeded. 9. Where the market share referred to in paragraph 2(b) is initially not more than 25 % but subsequently rises above 30 %, the exemption provided for in Article 5 shall continue to apply for a period of one calendar year following the year in which the level of 30 % was first exceeded. 10. The benefit of paragraphs 8 and 9 may not be combined so as to exceed a period of two calendar years. Article 7 Conditions for exemption The exemption provided for in Article 5 shall apply on condition that: (a) each participating undertaking having given a reasonable period of notice has the right to withdraw from the pool, without incurring any sanctions; (b) the rules of the pool do not oblige any participating undertaking of the pool to insure or reinsure through the pool and do not restrict any participating undertaking of the pool from insuring or reinsuring outside the pool, in whole or in part, any risk of the type covered by the pool; (c) the rules of the pool do not restrict the activity of the pool or its participating undertakings to the insurance or reinsurance of risks located in any particular geographical part of the Union; (d) the agreement does not limit output or sales; (e) the agreement does not allocate markets or customers; and (f) the participating undertakings of a co-reinsurance pool do not agree on the commercial premiums which they charge for direct insurance.",
"CHAPTER IV FINAL PROVISIONS Article 8 Transitional period The prohibition laid down in Article 101(1) of the Treaty shall not apply during the period from 1 April 2010 to 30 September 2010 in respect of agreements already in force on 31 March 2010 which do not satisfy the conditions for exemption provided for in this Regulation but which satisfy the conditions for exemption provided for in Regulation (EC) No 358/2003. Article 9 Period of validity This Regulation shall enter into force on 1 April 2010. It shall expire on 31 March 2017. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 24 March 2010. For the Commission The President Josà © Manuel BARROSO (1) OJ L 143, 7.6.1991, p. 1. (2) With effect from 1 December 2009, Article 81 of the EC Treaty has become Article 101 of the Treaty on the Functioning of the European Union. The two articles are, in substance, identical. For the purposes of this Regulation, references to Article 101 of the Treaty on the Functioning of the European Union should be understood as references to Article 81 of the EC Treaty where appropriate.",
"(3) OJ L 53, 28.2.2003, p. 8. (4) COM(2009) 138. (5) OJ L 1, 4.1.2003, p. 1."
] | https://dataverse.harvard.edu/dataset.xhtml?persistentId=doi:10.7910/DVN/0EGYWY | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
117 HR 87 IH: Jurists United to Stop Trafficking Imitation Child Exploitation Act of 2021 U.S. House of Representatives 2021-01-04 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
I117th CONGRESS1st SessionH. R. 87IN THE HOUSE OF REPRESENTATIVESJanuary 4, 2021Mr. Duncan (for himself, Mr. Calvert, Mr. Waltz, Mr. Posey, Mr. Carter of Georgia, Mr. Joyce of Ohio, Mr. Perry, Mr. Timmons, Mr. Fleischmann, Mr. Gosar, Mr. Kelly of Mississippi, Mr. Budd, Mr. Weber of Texas, and Mr. Norman) introduced the following bill; which was referred to the Committee on the JudiciaryA BILLTo amend title 18, United States Code, to prohibit the importation or transportation of child sex dolls, and for other purposes.1.Short titleThis Act may be cited as the Jurists United to Stop Trafficking Imitation Child Exploitation Act of 2021 or the JUSTICE Act of 2021.2.FindingsThe Congress finds as follows:(1)There is a correlation between possession of the obscene dolls, and robots, and possession of and participation in child pornography.(2)The physical features, and potentially the personalities of the robots are customizable or morphable and can resemble actual children.(3)Some owners and makers of the robots have made their children interact with the robots as if the robots are members of the family.(4)The robots can have settings that simulate rape.(5)The dolls and robots not only lead to rape, but they make rape easier by teaching the rapist about how to overcome resistance and subdue the victim.(6)For users and children exposed to their use, the dolls and robots normalize submissiveness and normalize sex between adults and minors.(7)As the Supreme Court has recognized, obscene material is often used as part of a method of seducing child victims.(8)The dolls and robots are intrinsically related to abuse of minors, and they cause the exploitation, objectification, abuse, and rape of minors.3.Prohibition of importation or transportation of child sex dollsSection 1462 of title 18, United States Code, is amended—(1)in paragraph (a), by striking or at the end;(2)in paragraph (b), by striking or at the end;(3)by inserting after paragraph (c) the following:(d)any child sex doll; or; and(4)by adding at the end the following:In this section, the term child sex doll means an anatomically correct doll, mannequin, or robot, with the features of, or with features that resemble those of, a minor, intended for use in sexual acts.. | 01-04-2021 | [
"117 HR 87 IH: Jurists United to Stop Trafficking Imitation Child Exploitation Act of 2021 U.S. House of Representatives 2021-01-04 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain. I117th CONGRESS1st SessionH. R. 87IN THE HOUSE OF REPRESENTATIVESJanuary 4, 2021Mr. Duncan (for himself, Mr. Calvert, Mr. Waltz, Mr. Posey, Mr. Carter of Georgia, Mr. Joyce of Ohio, Mr. Perry, Mr. Timmons, Mr. Fleischmann, Mr. Gosar, Mr. Kelly of Mississippi, Mr. Budd, Mr. Weber of Texas, and Mr. Norman) introduced the following bill; which was referred to the Committee on the JudiciaryA BILLTo amend title 18, United States Code, to prohibit the importation or transportation of child sex dolls, and for other purposes.1.Short titleThis Act may be cited as the Jurists United to Stop Trafficking Imitation Child Exploitation Act of 2021 or the JUSTICE Act of 2021.2.FindingsThe Congress finds as follows:(1)There is a correlation between possession of the obscene dolls, and robots, and possession of and participation in child pornography.",
"(2)The physical features, and potentially the personalities of the robots are customizable or morphable and can resemble actual children. (3)Some owners and makers of the robots have made their children interact with the robots as if the robots are members of the family. (4)The robots can have settings that simulate rape. (5)The dolls and robots not only lead to rape, but they make rape easier by teaching the rapist about how to overcome resistance and subdue the victim. (6)For users and children exposed to their use, the dolls and robots normalize submissiveness and normalize sex between adults and minors. (7)As the Supreme Court has recognized, obscene material is often used as part of a method of seducing child victims. (8)The dolls and robots are intrinsically related to abuse of minors, and they cause the exploitation, objectification, abuse, and rape of minors.3.Prohibition of importation or transportation of child sex dollsSection 1462 of title 18, United States Code, is amended—(1)in paragraph (a), by striking or at the end;(2)in paragraph (b), by striking or at the end;(3)by inserting after paragraph (c) the following:(d)any child sex doll; or; and(4)by adding at the end the following:In this section, the term child sex doll means an anatomically correct doll, mannequin, or robot, with the features of, or with features that resemble those of, a minor, intended for use in sexual acts.."
] | https://www.govinfo.gov/content/pkg/BILLS-117hr87ih/xml/BILLS-117hr87ih.xml | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case: 21-2163 Document: 33 Page: 1 Filed: 08/09/2022
NOTE: This disposition is nonprecedential.
United States Court of Appeals for the Federal Circuit ______________________
JONATHAN R. HIRSCH, Plaintiff-Appellant
v.
UNITED STATES, Defendant-Appellee ______________________
2021-2163 ______________________
Appeal from the United States Court of Federal Claims in No. 1:19-cv-00236-RAH, Judge Richard A. Hertling. ______________________
Decided: August 9, 2022 ______________________
THOMAS ANDREW COULTER, Norton Rose Fulbright US LLP, Washington, DC, argued for plaintiff-appellant.
RICHARD PAUL SCHROEDER, Commercial Litigation Branch, Civil Division, United States Department of Jus- tice, Washington, DC, argued for defendant-appellee. Also represented by BRIAN M. BOYNTON, PATRICIA M. MCCARTHY, DOUGLAS K. MICKLE; NICHOLAS MORJAL, Liti- gation Division, United States Army Legal Services Agency, Fort Belvoir, VA. ______________________ Case: 21-2163 Document: 33 Page: 2 Filed: 08/09/2022
2 HIRSCH v. US
Before MOORE, Chief Judge, LOURIE and STARK, Circuit Judges. LOURIE, Circuit Judge. Lieutenant Colonel (“LTC”) Jonathan R. Hirsch began serving in the United States Army in 1988. While serving in the Army, LTC Hirsch attended law school. In 2016, the Army removed LTC Hirsch from active status. According to the Army, he had served for 28 years, the maximum al- lowed for lieutenant colonels under 10 U.S.C. § 14507(a) (absent certain exceptions not applicable here). Because LTC Hirsch disagreed with the Army’s calculation of 28 years, he filed a complaint in the United States Court of Federal Claims (“the Claims Court”). In his complaint, he argued that the Army should have excluded the service that he performed concurrently with law school. In support of his argument, LTC Hirsch pointed to 10 U.S.C. § 14706, which provides that certain periods of service are excluded from the Army’s 28-year calculation. The Claims Court de- nied LTC Hirsch’s claim based on its construction of § 14706. Hirsch v. United States, No. 19-236C, 153 Fed. Cl. 345 (2021) (“Decision”). Because the Claims Court erred in construing § 14706, we reverse its decision and remand for further proceedings consistent with this opinion. BACKGROUND This appeal concerns the Army’s removal of LTC Hirsch from active status. We begin with a brief over- view of the statutory framework governing his removal. I Under 10 U.S.C. § 14507(a), an Army reserve officer who holds the grade of lieutenant colonel and is not recom- mended for promotion, “shall . . . be removed from [the Case: 21-2163 Document: 33 Page: 3 Filed: 08/09/2022
HIRSCH v. US 3
reserve active-status list]” after “complet[ing] 28 years of commissioned service.” 1 When calculating an officer’s removal date, however, the Army need not include every year of service. 2 For ex- ample, 10 U.S.C. § 14706(a)(3) provides a general rule ex- cluding the service that an officer performed while attending an advanced education program (provided that the officer satisfies other relevant requirements, discussed further below). It reads as follows: [A] Reserve officer’s years of service include all ser- vice of the officer as a commissioned officer . . . other than the following: . . . Service after appoint- ment as a commissioned officer of a reserve compo- nent while in a program of advanced education to obtain the first professional degree required for ap- pointment, designation, or assignment to a profes- sional specialty, but only if that service occurs before the officer commences initial service on active duty or initial service in the Ready Reserve in the specialty that results from such a degree. § 14706(a)(3) (emphases added). A separate subsection of the statute limits the scope of the exclusion in § 14706(a)(3). Specifically, 10 U.S.C. § 14706(b) provides that: The exclusion under subsection (a)(3) does not ap- ply to service performed by an officer who previously served on active duty or participated as a member of the Ready Reserve in other than a student status
1 The statute also encompasses certain reserve offic- ers in the Navy, Air Force, and Marine Corps. 2 The parties also refer to “mandatory removal” as “mandatory retirement.” Case: 21-2163 Document: 33 Page: 4 Filed: 08/09/2022
4 HIRSCH v. US
for the period of service preceding the member’s ser- vice in a student status. § 14706(b) (emphases added). With this background in mind, we now turn to LTC Hirsch’s Army service. II From August 1984 to May 1988, LTC Hirsch was en- rolled in the Reserve Officers’ Training Corps (“ROTC”) at Georgetown University. Decision, 153 Fed. Cl. at 348. On May 27, 1988, he was commissioned as an officer in the United States Army Reserve. Id. From May 1988 to Sep- tember 1992, he served as a Transportation Officer in var- ious military statuses, including the Individual Ready Reserve and active duty. Id. From September 1992 to May 1995, LTC Hirsch at- tended law school at the Louisiana State University Paul M. Hebert Law Center. Id. He did not attend law school under orders from the military. Id. Importantly, while at- tending law school, LTC Hirsch continued to serve as a re- serve officer. Id. From September 1995 to May 2016, LTC Hirsch served in the Judge Advocate General’s (“JAG”) Corps. Id. On June 1, 2016, 28 years after the Army commis- sioned LTC Hirsch as an officer, it removed him from active status. Id. at 347. When calculating his removal date, the Army included the (approximately) three years that he served as a reserve officer during law school from 1992 to 1995. Id. at 348. LTC Hirsch disagreed with the Army’s calculation and petitioned the Army Board for Correction of Military Records (“the Board”). Id. According to LTC Hirsch, the Army should have excluded those years of service pursuant to § 14706(a)(3). J.A. 140. In particular, he pointed to § 14706(a)(3)’s language that an officer’s ser- vice “while in a program of advanced education” is ex- cluded. Accordingly, LTC Hirsch requested that the Army Case: 21-2163 Document: 33 Page: 5 Filed: 08/09/2022
HIRSCH v. US 5
adjust his mandatory removal date from June 1, 2016 to June 1, 2019. Decision, 153 Fed. Cl. at 348. The Board denied LTC Hirsch’s petition in view of its construction of § 14706(a)(3). 3 Id. The Board acknowl- edged § 14706(a)(3)’s language that an officer is entitled to exclude “service . . . while in a program of advanced educa- tion.” J.A. 144, 146–47. It explained, however, that LTC Hirsch failed to address the sentence’s final clause: “but only if that service occurs before . . . initial service. . . in the specialty that results from such a degree.” Id. In the Board’s view, that clause requires an officer’s “initial service” to be in a specialty that results from the advanced degree. Id. (emphasis added). Accordingly, because LTC Hirsch’s initial service was in the Transportation Corps, which was not a specialty that resulted from his law de- gree, the Board denied his claim. Id.; J.A. 149. The Board also addressed § 14706(b), interpreting it to mean that the exclusion 4 does not apply to an officer’s service preceding enrollment in advanced education. J.A. 146. Following the Board’s denial, LTC Hirsch filed a com- plaint in the Claims Court. In his complaint, he again ar- gued that he was entitled to the exclusion in § 14706(a)(3). Decision, 153 Fed. Cl. at 350. Both LTC Hirsch and the government filed motions for judgment on the administra- tive record. Id. at 349. The Claims Court granted judgment in favor of the gov- ernment. Id. at 357. The court first observed that § 14706(a)(3) provides a general rule excluding the service
3 The Claims Court previously remanded LTC Hirsch’s appeal to the Board twice regarding matters not relevant to this appeal. Decision, 153 Fed. Cl. at 348–49. 4 “The exclusion” refers to the exclusion in § 14706(a)(3). Case: 21-2163 Document: 33 Page: 6 Filed: 08/09/2022
6 HIRSCH v. US
that an officer performed while enrolled in advanced edu- cation. Id. at 350. It further acknowledged that both par- ties offered differing interpretations of § 14706(a)(3)’s scope. Id. The court, however, declined to construe § 14706(a)(3); in its view, a separate subsection of the stat- ute barred LTC Hirsch’s service from being excluded— § 14706(b). Id. at 352. In particular, the Claims Court focused on § 14706(b)’s language that “the exclusion under [§ 14706(a)(3)] does not apply to service performed by an officer who previously served [on active duty or in the Ready Reserve] . . . for the period of service preceding the member’s service in a stu- dent status.” § 14706(b); Decision, 153 Fed. Cl. at 354–55. In the court’s view, § 14706(b) provides that the exclusion does not apply to an officer who served (on active duty or in the Ready Reserve in other than a student status) before enrolling in advanced education. Decision, 153 Fed. Cl. at 353–54. The court specifically observed that: Subsection (b) contains no punctuation indicating a break. It first provides that the provision limits the exclusion found in subsection (a)(3): “The exclu- sion under subsection (a)(3) does not apply to ser- vice performed by an officer . . . .” 10 U.S.C. § 14706(b). What follows is a single restrictive rela- tive clause modifying the noun “officer” and defin- ing which officers cannot exclude their service under subsection (a)(3): those “who previously served on active duty or participated as a member of the Ready Reserve in other than a student status for the period of service preceding the member’s service in a student status.” Id. at 354. Because LTC Hirsch served as a Transportation Officer before attending law school, the court determined that he was not entitled to have his service during law school Case: 21-2163 Document: 33 Page: 7 Filed: 08/09/2022
HIRSCH v. US 7
excluded. Id. at 357. 5 Accordingly, it concluded that the Army correctly calculated LTC Hirsch’s mandatory re- moval date and granted the government’s motion for judg- ment on the administrative record. Id. LTC Hirsch moved for reconsideration. The court denied his motion. Hirsch v. United States, 154 Fed. Cl. 24 (2021). LTC Hirsch ap- pealed to this court. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(3). DISCUSSION This court reviews a decision of the Claims Court “granting or denying a motion for judgment on the admin- istrative record de novo, applying the same standard of re- view as the [Claims Court].” Prestonback v. United States, 965 F.3d 1363, 1368 (Fed. Cir. 2020) (citing Palantir USG, Inc. v. United States, 904 F.3d 980, 989 (Fed. Cir. 2018)). “Accordingly, we will not disturb the decision of the Board unless it is arbitrary, capricious, contrary to law, or unsup- ported by substantial evidence.” Id. (citing Chambers v. United States, 417 F.3d 1218, 1227 (Fed. Cir. 2005)). We review the Claims Court’s interpretation of a stat- ute de novo. Flowers v. Sec’y of Dep’t of Health & Human Servs., 49 F.3d 1558, 1559–60 (Fed. Cir. 1995) (citing Matos v. Sec’y of Dep’t of Health & Human Servs., 35 F.3d 1549, 1552 (Fed. Cir. 1994)). “[A]ll statutory construction cases . . . begin with the language of the statute.” Momenta Pharms., Inc. v. Amphastar Pharms., Inc., 686 F.3d 1348, 1353–54 (Fed. Cir. 2012) (quoting Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450 (2002) (alterations in original)). We first “determine whether the language at issue has a plain and unambiguous meaning with regard to the particular dispute in the case.” Id. (quoting Robinson v. Shell Oil Co.,
5 The Claims Court recognized that its interpreta- tion of § 14706(b) differed from the Board’s interpretation. Decision, 153 Fed. Cl. at 353. Case: 21-2163 Document: 33 Page: 8 Filed: 08/09/2022
8 HIRSCH v. US
519 U.S. 337, 340 (1997)). “Whether the text of a statute is plain or ambiguous ‘is determined by reference to the lan- guage itself, the specific context in which the language is used, and the broader context of the statute as a whole.’” Id. at 1354 (quoting Robinson, 519 U.S. at 341). Our “in- quiry ceases ‘if the statutory language is unambiguous and the statutory scheme is coherent and consistent.’” Barn- hart, 534 U.S. at 450 (quoting Robinson, 519 U.S. at 340). The parties’ dispute centers on the construction of § 14706(a)(3) and (b). To prevail, LTC Hirsch must estab- lish that he is entitled to the exclusion in § 14706(a)(3) and not barred from that exclusion by § 14706(b). Accordingly, we address each subsection in turn. I As in any case involving statutory interpretation, we begin with the language of the statute itself. See Consumer Prod. Safety Comm’n v. GTE Sylvania, Inc., 447 U.S. 102, 108 (1980). Under § 14706(a)(3), for an officer’s service to qualify for the exclusion, it must have occurred: (1) “after [the officer’s] appointment as a commissioned officer of a reserve component,” (2) “while [the officer was] in a pro- gram of advanced education to obtain the first professional degree required for appointment, designation, or assign- ment to a professional specialty,” and (3) “before the officer commences initial service on active duty or initial service in the Ready Reserve in the specialty that results from such a degree.” Both parties agree that LTC Hirsch’s service during law school from 1992 to 1995 satisfies the first two clauses of § 14706(a)(3) because it occurred (1) after he was ap- pointed as a commissioned officer and (2) while he was in an advanced education program—law school. Accordingly, they focus on the subsection’s third clause: “before the of- ficer commences initial service . . . in the specialty that re- sults from such a degree.” § 14706(a)(3). Case: 21-2163 Document: 33 Page: 9 Filed: 08/09/2022
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The government proposes a broad interpretation of the third clause. According to the government, to benefit from the exclusion in § 14706(a)(3), an officer’s “initial service” must be “in the specialty that results from the advanced degree.” Appellee’s Br. 36 (emphasis added). Thus, be- cause LTC Hirsch initially served in the Transportation Corps (not a specialty resulting from his law degree), the government argues that he is ineligible for the exclusion. LTC Hirsch responds that the government’s construc- tion contradicts the plain language of the statute. Specifi- cally, he argues that the government reads the word “initial service” in isolation, without accounting for the fi- nal clause—“in the specialty that results from such a de- gree.” Appellant’s Br. 32. Thus, according to LTC Hirsch, his “initial service” in the Transportation Corps is irrele- vant; that service did not “result[]” from his law degree. Id. at 36. We agree with LTC Hirsch that the government’s con- struction contradicts the statute’s plain language. Here, “the language at issue has a plain and unambiguous mean- ing with regard to the particular dispute in the case.” Barnhart, 534 U.S. at 450 (quoting Robinson, 519 U.S. at 340). It provides, in relevant part, that to obtain the exclu- sion, a specific sequence of events must occur: an officer must serve while obtaining a degree from a “program of ad- vanced education” and only then “initially serve” in “the specialty that results from” that degree. LTC Hirsch satis- fied those requirements. He served in the Army while at- tending law school and only then initially served in a specialty resulting from his law degree, i.e., the JAG Corps. The government’s alternative construction is unsup- ported by the plain language of the statute. The govern- ment places much weight on the word “initial,” emphasizing that an officer’s “initial” service must be in the “specialty resulting from the advanced degree.” But the government reads the word “initial” in isolation, Case: 21-2163 Document: 33 Page: 10 Filed: 08/09/2022
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ignoring the following clause: “in the specialty that results from such a degree.” § 14706(a)(3). That clause serves an important purpose: it qualifies the type of “initial service” that is relevant, namely, service in the specialty resulting from the advanced degree. In effect, the government urges us to read that clause out of the statute entirely. We de- cline to do so. See Hellebrand v. Sec’y of Dep’t of Health & Hum. Servs., 999 F.2d 1565, 1571 (Fed. Cir. 1993) (“A stat- ute is to be construed in a way which gives meaning and effect to all of its parts.” (citing United States v. Nordic Vil- lage, Inc., 50 U.S. 30, 35–36 (1992))). Accordingly, for pur- poses of our analysis here, it is immaterial that LTC Hirsch “initially served” in the Transportation Corps before at- tending law school; that service was not in a specialty re- sulting from his law degree. The government also insists that LTC Hirsch’s con- struction “would render the word ‘[initial]’ insignificant, if not wholly superfluous.” Appellee’s Br. 36. It argues that LTC Hirsch’s construction does not give effect “to every clause and word of a statute.” Id. (quoting United States v. Menasche, 348 U.S. 528, 538–39 (1955)). We disagree with the government’s argument. As is clear from the context of § 14706(a)(3) and the surrounding language, the word “initial” refers to the officer’s first em- ployment in the “specialty that results from” the advanced degree. Here, that would mean LTC Hirsch’s initial service in the JAG Corps. Accordingly, we conclude that LTC Hirsch is eligible for the exclusion in § 14706(a)(3). Because the government ar- gues that LTC Hirsch is independently barred from the ex- clusion under § 14706(b), we address that subsection next. II Section 14706(b) provides that: The exclusion under subsection (a)(3) does not ap- ply to service performed by an officer who previously Case: 21-2163 Document: 33 Page: 11 Filed: 08/09/2022
HIRSCH v. US 11
served on active duty or participated as a member of the Ready Reserve in other than a student status for the period of service preceding the member’s ser- vice in a student status. § 14706(b) (emphases added). The government reads § 14706(b) to bar a particular category of officers from the exclusion, namely, officers who previously served (on active duty or in the Ready Reserve) before enrolling in advanced education. In support of its construction, the government largely repeats the Claims Court’s analysis, explaining that § 14706(b) contains a “re- strictive relative clause” defining which category of officers are ineligible for the exclusion: those “who previously served . . . for the period of service preceding the member’s service in a student status.” Appellee’s Br. 26 (quoting De- cision, 153 Fed. Cl. at 354). Accordingly, because LTC Hirsch previously served in the Transportation Corps prior to attending law school, the government contends that he is ineligible for the exclusion. LTC Hirsch responds that the Army misconstrues § 14706(b). According to LTC Hirsch, § 14706(b) does not bar a particular “category of officers” from invoking the ex- clusion. Appellant’s Rep. Br. 18–19. Rather, it bars a par- ticular “category of service,” namely, “the period of service preceding the member’s service in a student status.” § 14706(b). In other words, under LTC Hirsch’s construc- tion, the exclusion does not apply to an officer’s service be- fore the advanced education program. 6 Here, that would mean the period that LTC Hirsch spent as a Transporta- tion Officer before law school, from 1988 to 1992.
6 LTC Hirsch does not dispute that those four years should count toward his total years of service. Rather, he contends that the years of service during law school should be excluded. Case: 21-2163 Document: 33 Page: 12 Filed: 08/09/2022
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We agree with LTC Hirsch’s construction of § 14706(b). Under the plain and natural reading of the statute, § 14706(b) provides that the exclusion does not ap- ply to an officer’s service before the advanced education program. Specifically, § 14706(b) first provides that the ex- clusion does not apply to a specific period of service, namely, “service performed by an officer who previously served . . . .” It then clarifies which period of service: that which “preced[es] the member’s service in a student sta- tus.” § 14706(b). The government’s construction, on the other hand, is inconsistent with the plain language of the statute. Con- trary to the government’s argument, § 14706(b) does not bar a particular category of officers from invoking the ex- clusion. If that were the case, the statute would state that the exclusion does not apply to “an officer who previously served . . . .” There would be no reason for it to specify that the exclusion does not apply to “service performed by an of- ficer who previously served . . . .” See id. (emphasis added). Similarly, the government’s construction would also render the last clause of § 14706(b)—“for the period of ser- vice preceding the member’s service in a student status”— superfluous. Id. More specifically, if, as the government contends, the statute bars an officer who “previously served” before enrolling in advanced education, then it would have stated so. There would be no need for it to fur- ther provide “for the period of service preceding the mem- ber’s service in a student status.” Id. Indeed, the Claims Court itself acknowledged that, under the government’s construction, the final clause “could be deleted without changing the meaning because the provision already uses the word ‘previously.’” Decision, 153 Fed. Cl. at 355. It similarly explained that the government’s construction was “not ideal, because it produces repetitive meaning Case: 21-2163 Document: 33 Page: 13 Filed: 08/09/2022
HIRSCH v. US 13
within the provision.” 7 Id. We agree with the court’s ob- servations. The government makes several additional arguments, all unpersuasive. First, the government argues that the “legislative history of 10 U.S.C. § 14706 precludes LTC Hirsch from the exclusion.” Appellee’s Br. 47–48 (cap- italization modified). Specifically, the government points to earlier versions of the statute that omitted the final clause, “for the period of service preceding the member’s service in a student status.” See H.R. 1401 at 39, 106th Cong. § 514 (1999); S. 1059 at 135–36, 106th Cong. § 519 (1999). 8 According to the government, those earlier ver- sions conveyed Congress’s intent to preclude officers with service prior to their advanced education from the exclu- sion. We disagree with the government. “Absent a clearly expressed legislative intention to the contrary, [the stat- ute’s] language must ordinarily be regarded as conclusive.” See Consumer Prod. Safety Comm’n, 447 U.S. at 108. Here, the government fails to point to a legislative intention con- trary to the statute’s plain language. Certainly, earlier versions of the statute omitted the final clause, “for the pe- riod of service preceding the member’s service in a student status.” Importantly, however, Congress did not enact those earlier versions. Instead, it enacted a version that included the final clause. Accordingly, we must assume that Congress added this language with a purpose, namely, to clarify which period of service is not subject to the exclu- sion. See Taylor v. United States, 495 U.S. 575, 597 (1990)
7 The court still determined that the government’s construction was “the most natural syntactical reading of the language.” Decision, 153 Fed. Cl. at 355. 8 Available at https://www.congress.gov/106/bills/ hr1401/BILLS-106hr1401ih.pdf and https://www.con- gress.gov/106/bills/s1059/BILLS-106s1059pp.pdf. Case: 21-2163 Document: 33 Page: 14 Filed: 08/09/2022
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(“We must assume that Congress had a purpose in adding the word ‘burglary’ to [the statute].”); GPX Int’l Tire Corp. v. United States, 678 F.3d 1308, 1312 (Fed. Cir. 2012) (“[A] statute cannot be interpreted in a manner that would ‘ne- gate[] its recent revision, and indeed would render it [] largely meaningless.’”) (quoting Rumsfeld v. Forum for Acad. & Institutional Rts., 547 U.S. 47, 57–58 (2006) (al- terations in original)). Moreover, the government’s inter- pretation under which “the final phrase could be deleted without changing the meaning,” Decision, 153 Fed. Cl. at 355, is inconsistent with the legislative history. Second, the government contends that LTC Hirsch’s construction is illogical. According to the government, the statute already clarifies that the exclusion applies to an of- ficer’s service during an advanced education program (as long as the officer’s service meets additional requirements). Thus, in the government’s view, it would be pointless for the statute to further clarify that the exclusion does not apply to an officer’s service before the advanced education program. We disagree with the government. LTC Hirsch’s con- struction makes sense in view of “the broader context of the statute as a whole.” Momenta Pharms., 686 F.3d at 1354 (quoting Robinson, 519 U.S. at 341). As explained above, § 14706(a)(3) provides that the exclusion applies to an of- ficer’s service during an advanced education program (sub- ject to additional requirements). However, some subset of officers such as LTC Hirsch may have also served prior to attending an advanced education program. Sec- tion 14706(b) makes clear that such prior service is not also subject to the exclusion. The government’s argument is thus unpersuasive. Accordingly, we construe § 14706(b) to provide that the exclusion does not apply to “the period of service preceding the member’s service in a student Case: 21-2163 Document: 33 Page: 15 Filed: 08/09/2022
HIRSCH v. US 15
status.” 9 Here that encompasses LTC Hirsch’s service in the Transportation Corps. In summary, because LTC Hirsch satisfies both the re- quirements of § 14706(a)(3) and § 14706(b), he is entitled to exclude his service during law school. CONCLUSION We have considered the government’s remaining argu- ments but find them unpersuasive. For the foregoing rea- sons, we reverse the Claims Court’s judgment and remand for further proceedings consistent with this opinion. REVERSED AND REMANDED COSTS Costs to appellant.
9 Although not dispositive, this construction com- ports with the Army’s regulation concerning chaplain can- didates. See Army Reg. 165-1, 7-5(a). | 09-12-2022 | [
"Case: 21-2163 Document: 33 Page: 1 Filed: 08/09/2022 NOTE: This disposition is nonprecedential. United States Court of Appeals for the Federal Circuit ______________________ JONATHAN R. HIRSCH, Plaintiff-Appellant v. UNITED STATES, Defendant-Appellee ______________________ 2021-2163 ______________________ Appeal from the United States Court of Federal Claims in No. 1:19-cv-00236-RAH, Judge Richard A. Hertling. ______________________ Decided: August 9, 2022 ______________________ THOMAS ANDREW COULTER, Norton Rose Fulbright US LLP, Washington, DC, argued for plaintiff-appellant. RICHARD PAUL SCHROEDER, Commercial Litigation Branch, Civil Division, United States Department of Jus- tice, Washington, DC, argued for defendant-appellee. Also represented by BRIAN M. BOYNTON, PATRICIA M. MCCARTHY, DOUGLAS K. MICKLE; NICHOLAS MORJAL, Liti- gation Division, United States Army Legal Services Agency, Fort Belvoir, VA. ______________________ Case: 21-2163 Document: 33 Page: 2 Filed: 08/09/2022 2 HIRSCH v. US Before MOORE, Chief Judge, LOURIE and STARK, Circuit Judges.",
"LOURIE, Circuit Judge. Lieutenant Colonel (“LTC”) Jonathan R. Hirsch began serving in the United States Army in 1988. While serving in the Army, LTC Hirsch attended law school. In 2016, the Army removed LTC Hirsch from active status. According to the Army, he had served for 28 years, the maximum al- lowed for lieutenant colonels under 10 U.S.C. § 14507(a) (absent certain exceptions not applicable here). Because LTC Hirsch disagreed with the Army’s calculation of 28 years, he filed a complaint in the United States Court of Federal Claims (“the Claims Court”). In his complaint, he argued that the Army should have excluded the service that he performed concurrently with law school. In support of his argument, LTC Hirsch pointed to 10 U.S.C. § 14706, which provides that certain periods of service are excluded from the Army’s 28-year calculation.",
"The Claims Court de- nied LTC Hirsch’s claim based on its construction of § 14706. Hirsch v. United States, No. 19-236C, 153 Fed. Cl. 345 (2021) (“Decision”). Because the Claims Court erred in construing § 14706, we reverse its decision and remand for further proceedings consistent with this opinion. BACKGROUND This appeal concerns the Army’s removal of LTC Hirsch from active status. We begin with a brief over- view of the statutory framework governing his removal. I Under 10 U.S.C. § 14507(a), an Army reserve officer who holds the grade of lieutenant colonel and is not recom- mended for promotion, “shall . . .",
"be removed from [the Case: 21-2163 Document: 33 Page: 3 Filed: 08/09/2022 HIRSCH v. US 3 reserve active-status list]” after “complet[ing] 28 years of commissioned service.” 1 When calculating an officer’s removal date, however, the Army need not include every year of service. 2 For ex- ample, 10 U.S.C. § 14706(a)(3) provides a general rule ex- cluding the service that an officer performed while attending an advanced education program (provided that the officer satisfies other relevant requirements, discussed further below). It reads as follows: [A] Reserve officer’s years of service include all ser- vice of the officer as a commissioned officer . . . other than the following: . .",
". Service after appoint- ment as a commissioned officer of a reserve compo- nent while in a program of advanced education to obtain the first professional degree required for ap- pointment, designation, or assignment to a profes- sional specialty, but only if that service occurs before the officer commences initial service on active duty or initial service in the Ready Reserve in the specialty that results from such a degree. § 14706(a)(3) (emphases added). A separate subsection of the statute limits the scope of the exclusion in § 14706(a)(3). Specifically, 10 U.S.C. § 14706(b) provides that: The exclusion under subsection (a)(3) does not ap- ply to service performed by an officer who previously served on active duty or participated as a member of the Ready Reserve in other than a student status 1 The statute also encompasses certain reserve offic- ers in the Navy, Air Force, and Marine Corps. 2 The parties also refer to “mandatory removal” as “mandatory retirement.” Case: 21-2163 Document: 33 Page: 4 Filed: 08/09/2022 4 HIRSCH v. US for the period of service preceding the member’s ser- vice in a student status. § 14706(b) (emphases added). With this background in mind, we now turn to LTC Hirsch’s Army service. II From August 1984 to May 1988, LTC Hirsch was en- rolled in the Reserve Officers’ Training Corps (“ROTC”) at Georgetown University. Decision, 153 Fed.",
"Cl. at 348. On May 27, 1988, he was commissioned as an officer in the United States Army Reserve. Id. From May 1988 to Sep- tember 1992, he served as a Transportation Officer in var- ious military statuses, including the Individual Ready Reserve and active duty. Id. From September 1992 to May 1995, LTC Hirsch at- tended law school at the Louisiana State University Paul M. Hebert Law Center. Id. He did not attend law school under orders from the military. Id.",
"Importantly, while at- tending law school, LTC Hirsch continued to serve as a re- serve officer. Id. From September 1995 to May 2016, LTC Hirsch served in the Judge Advocate General’s (“JAG”) Corps. Id. On June 1, 2016, 28 years after the Army commis- sioned LTC Hirsch as an officer, it removed him from active status. Id. at 347. When calculating his removal date, the Army included the (approximately) three years that he served as a reserve officer during law school from 1992 to 1995. Id. at 348. LTC Hirsch disagreed with the Army’s calculation and petitioned the Army Board for Correction of Military Records (“the Board”). Id. According to LTC Hirsch, the Army should have excluded those years of service pursuant to § 14706(a)(3). J.A. 140. In particular, he pointed to § 14706(a)(3)’s language that an officer’s ser- vice “while in a program of advanced education” is ex- cluded. Accordingly, LTC Hirsch requested that the Army Case: 21-2163 Document: 33 Page: 5 Filed: 08/09/2022 HIRSCH v. US 5 adjust his mandatory removal date from June 1, 2016 to June 1, 2019.",
"Decision, 153 Fed. Cl. at 348. The Board denied LTC Hirsch’s petition in view of its construction of § 14706(a)(3). 3 Id. The Board acknowl- edged § 14706(a)(3)’s language that an officer is entitled to exclude “service . . . while in a program of advanced educa- tion.” J.A. 144, 146–47. It explained, however, that LTC Hirsch failed to address the sentence’s final clause: “but only if that service occurs before . . . initial service. . . in the specialty that results from such a degree.” Id. In the Board’s view, that clause requires an officer’s “initial service” to be in a specialty that results from the advanced degree.",
"Id. (emphasis added). Accordingly, because LTC Hirsch’s initial service was in the Transportation Corps, which was not a specialty that resulted from his law de- gree, the Board denied his claim. Id. ; J.A. 149. The Board also addressed § 14706(b), interpreting it to mean that the exclusion 4 does not apply to an officer’s service preceding enrollment in advanced education. J.A. 146. Following the Board’s denial, LTC Hirsch filed a com- plaint in the Claims Court. In his complaint, he again ar- gued that he was entitled to the exclusion in § 14706(a)(3). Decision, 153 Fed. Cl. at 350. Both LTC Hirsch and the government filed motions for judgment on the administra- tive record. Id. at 349.",
"The Claims Court granted judgment in favor of the gov- ernment. Id. at 357. The court first observed that § 14706(a)(3) provides a general rule excluding the service 3 The Claims Court previously remanded LTC Hirsch’s appeal to the Board twice regarding matters not relevant to this appeal. Decision, 153 Fed. Cl. at 348–49. 4 “The exclusion” refers to the exclusion in § 14706(a)(3). Case: 21-2163 Document: 33 Page: 6 Filed: 08/09/2022 6 HIRSCH v. US that an officer performed while enrolled in advanced edu- cation. Id. at 350. It further acknowledged that both par- ties offered differing interpretations of § 14706(a)(3)’s scope. Id. The court, however, declined to construe § 14706(a)(3); in its view, a separate subsection of the stat- ute barred LTC Hirsch’s service from being excluded— § 14706(b). Id.",
"at 352. In particular, the Claims Court focused on § 14706(b)’s language that “the exclusion under [§ 14706(a)(3)] does not apply to service performed by an officer who previously served [on active duty or in the Ready Reserve] . . . for the period of service preceding the member’s service in a stu- dent status.” § 14706(b); Decision, 153 Fed. Cl. at 354–55. In the court’s view, § 14706(b) provides that the exclusion does not apply to an officer who served (on active duty or in the Ready Reserve in other than a student status) before enrolling in advanced education. Decision, 153 Fed.",
"Cl. at 353–54. The court specifically observed that: Subsection (b) contains no punctuation indicating a break. It first provides that the provision limits the exclusion found in subsection (a)(3): “The exclu- sion under subsection (a)(3) does not apply to ser- vice performed by an officer . . . .” 10 U.S.C. § 14706(b). What follows is a single restrictive rela- tive clause modifying the noun “officer” and defin- ing which officers cannot exclude their service under subsection (a)(3): those “who previously served on active duty or participated as a member of the Ready Reserve in other than a student status for the period of service preceding the member’s service in a student status.” Id.",
"at 354. Because LTC Hirsch served as a Transportation Officer before attending law school, the court determined that he was not entitled to have his service during law school Case: 21-2163 Document: 33 Page: 7 Filed: 08/09/2022 HIRSCH v. US 7 excluded. Id. at 357. 5 Accordingly, it concluded that the Army correctly calculated LTC Hirsch’s mandatory re- moval date and granted the government’s motion for judg- ment on the administrative record. Id. LTC Hirsch moved for reconsideration. The court denied his motion. Hirsch v. United States, 154 Fed. Cl. 24 (2021). LTC Hirsch ap- pealed to this court. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(3). DISCUSSION This court reviews a decision of the Claims Court “granting or denying a motion for judgment on the admin- istrative record de novo, applying the same standard of re- view as the [Claims Court].” Prestonback v. United States, 965 F.3d 1363, 1368 (Fed. Cir. 2020) (citing Palantir USG, Inc. v. United States, 904 F.3d 980, 989 (Fed. Cir. 2018)).",
"“Accordingly, we will not disturb the decision of the Board unless it is arbitrary, capricious, contrary to law, or unsup- ported by substantial evidence.” Id. (citing Chambers v. United States, 417 F.3d 1218, 1227 (Fed. Cir. 2005)). We review the Claims Court’s interpretation of a stat- ute de novo. Flowers v. Sec’y of Dep’t of Health & Human Servs., 49 F.3d 1558, 1559–60 (Fed. Cir. 1995) (citing Matos v. Sec’y of Dep’t of Health & Human Servs., 35 F.3d 1549, 1552 (Fed. Cir. 1994)). “[A]ll statutory construction cases . . . begin with the language of the statute.” Momenta Pharms., Inc. v. Amphastar Pharms., Inc., 686 F.3d 1348, 1353–54 (Fed. Cir. 2012) (quoting Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450 (2002) (alterations in original)). We first “determine whether the language at issue has a plain and unambiguous meaning with regard to the particular dispute in the case.” Id.",
"(quoting Robinson v. Shell Oil Co., 5 The Claims Court recognized that its interpreta- tion of § 14706(b) differed from the Board’s interpretation. Decision, 153 Fed. Cl. at 353. Case: 21-2163 Document: 33 Page: 8 Filed: 08/09/2022 8 HIRSCH v. US 519 U.S. 337, 340 (1997)). “Whether the text of a statute is plain or ambiguous ‘is determined by reference to the lan- guage itself, the specific context in which the language is used, and the broader context of the statute as a whole.’” Id.",
"at 1354 (quoting Robinson, 519 U.S. at 341). Our “in- quiry ceases ‘if the statutory language is unambiguous and the statutory scheme is coherent and consistent.’” Barn- hart, 534 U.S. at 450 (quoting Robinson, 519 U.S. at 340). The parties’ dispute centers on the construction of § 14706(a)(3) and (b). To prevail, LTC Hirsch must estab- lish that he is entitled to the exclusion in § 14706(a)(3) and not barred from that exclusion by § 14706(b). Accordingly, we address each subsection in turn. I As in any case involving statutory interpretation, we begin with the language of the statute itself. See Consumer Prod. Safety Comm’n v. GTE Sylvania, Inc., 447 U.S. 102, 108 (1980).",
"Under § 14706(a)(3), for an officer’s service to qualify for the exclusion, it must have occurred: (1) “after [the officer’s] appointment as a commissioned officer of a reserve component,” (2) “while [the officer was] in a pro- gram of advanced education to obtain the first professional degree required for appointment, designation, or assign- ment to a professional specialty,” and (3) “before the officer commences initial service on active duty or initial service in the Ready Reserve in the specialty that results from such a degree.” Both parties agree that LTC Hirsch’s service during law school from 1992 to 1995 satisfies the first two clauses of § 14706(a)(3) because it occurred (1) after he was ap- pointed as a commissioned officer and (2) while he was in an advanced education program—law school.",
"Accordingly, they focus on the subsection’s third clause: “before the of- ficer commences initial service . . . in the specialty that re- sults from such a degree.” § 14706(a)(3). Case: 21-2163 Document: 33 Page: 9 Filed: 08/09/2022 HIRSCH v. US 9 The government proposes a broad interpretation of the third clause. According to the government, to benefit from the exclusion in § 14706(a)(3), an officer’s “initial service” must be “in the specialty that results from the advanced degree.” Appellee’s Br. 36 (emphasis added). Thus, be- cause LTC Hirsch initially served in the Transportation Corps (not a specialty resulting from his law degree), the government argues that he is ineligible for the exclusion. LTC Hirsch responds that the government’s construc- tion contradicts the plain language of the statute. Specifi- cally, he argues that the government reads the word “initial service” in isolation, without accounting for the fi- nal clause—“in the specialty that results from such a de- gree.” Appellant’s Br.",
"32. Thus, according to LTC Hirsch, his “initial service” in the Transportation Corps is irrele- vant; that service did not “result[]” from his law degree. Id. at 36. We agree with LTC Hirsch that the government’s con- struction contradicts the statute’s plain language. Here, “the language at issue has a plain and unambiguous mean- ing with regard to the particular dispute in the case.” Barnhart, 534 U.S. at 450 (quoting Robinson, 519 U.S. at 340). It provides, in relevant part, that to obtain the exclu- sion, a specific sequence of events must occur: an officer must serve while obtaining a degree from a “program of ad- vanced education” and only then “initially serve” in “the specialty that results from” that degree. LTC Hirsch satis- fied those requirements. He served in the Army while at- tending law school and only then initially served in a specialty resulting from his law degree, i.e., the JAG Corps. The government’s alternative construction is unsup- ported by the plain language of the statute.",
"The govern- ment places much weight on the word “initial,” emphasizing that an officer’s “initial” service must be in the “specialty resulting from the advanced degree.” But the government reads the word “initial” in isolation, Case: 21-2163 Document: 33 Page: 10 Filed: 08/09/2022 10 HIRSCH v. US ignoring the following clause: “in the specialty that results from such a degree.” § 14706(a)(3). That clause serves an important purpose: it qualifies the type of “initial service” that is relevant, namely, service in the specialty resulting from the advanced degree. In effect, the government urges us to read that clause out of the statute entirely. We de- cline to do so. See Hellebrand v. Sec’y of Dep’t of Health & Hum.",
"Servs., 999 F.2d 1565, 1571 (Fed. Cir. 1993) (“A stat- ute is to be construed in a way which gives meaning and effect to all of its parts.” (citing United States v. Nordic Vil- lage, Inc., 50 U.S. 30, 35–36 (1992))). Accordingly, for pur- poses of our analysis here, it is immaterial that LTC Hirsch “initially served” in the Transportation Corps before at- tending law school; that service was not in a specialty re- sulting from his law degree. The government also insists that LTC Hirsch’s con- struction “would render the word ‘[initial]’ insignificant, if not wholly superfluous.” Appellee’s Br. 36.",
"It argues that LTC Hirsch’s construction does not give effect “to every clause and word of a statute.” Id. (quoting United States v. Menasche, 348 U.S. 528, 538–39 (1955)). We disagree with the government’s argument. As is clear from the context of § 14706(a)(3) and the surrounding language, the word “initial” refers to the officer’s first em- ployment in the “specialty that results from” the advanced degree. Here, that would mean LTC Hirsch’s initial service in the JAG Corps. Accordingly, we conclude that LTC Hirsch is eligible for the exclusion in § 14706(a)(3). Because the government ar- gues that LTC Hirsch is independently barred from the ex- clusion under § 14706(b), we address that subsection next. II Section 14706(b) provides that: The exclusion under subsection (a)(3) does not ap- ply to service performed by an officer who previously Case: 21-2163 Document: 33 Page: 11 Filed: 08/09/2022 HIRSCH v. US 11 served on active duty or participated as a member of the Ready Reserve in other than a student status for the period of service preceding the member’s ser- vice in a student status.",
"§ 14706(b) (emphases added). The government reads § 14706(b) to bar a particular category of officers from the exclusion, namely, officers who previously served (on active duty or in the Ready Reserve) before enrolling in advanced education. In support of its construction, the government largely repeats the Claims Court’s analysis, explaining that § 14706(b) contains a “re- strictive relative clause” defining which category of officers are ineligible for the exclusion: those “who previously served . . . for the period of service preceding the member’s service in a student status.” Appellee’s Br. 26 (quoting De- cision, 153 Fed.",
"Cl. at 354). Accordingly, because LTC Hirsch previously served in the Transportation Corps prior to attending law school, the government contends that he is ineligible for the exclusion. LTC Hirsch responds that the Army misconstrues § 14706(b). According to LTC Hirsch, § 14706(b) does not bar a particular “category of officers” from invoking the ex- clusion. Appellant’s Rep. Br. 18–19. Rather, it bars a par- ticular “category of service,” namely, “the period of service preceding the member’s service in a student status.” § 14706(b). In other words, under LTC Hirsch’s construc- tion, the exclusion does not apply to an officer’s service be- fore the advanced education program. 6 Here, that would mean the period that LTC Hirsch spent as a Transporta- tion Officer before law school, from 1988 to 1992.",
"6 LTC Hirsch does not dispute that those four years should count toward his total years of service. Rather, he contends that the years of service during law school should be excluded. Case: 21-2163 Document: 33 Page: 12 Filed: 08/09/2022 12 HIRSCH v. US We agree with LTC Hirsch’s construction of § 14706(b). Under the plain and natural reading of the statute, § 14706(b) provides that the exclusion does not ap- ply to an officer’s service before the advanced education program. Specifically, § 14706(b) first provides that the ex- clusion does not apply to a specific period of service, namely, “service performed by an officer who previously served . . . .” It then clarifies which period of service: that which “preced[es] the member’s service in a student sta- tus.” § 14706(b). The government’s construction, on the other hand, is inconsistent with the plain language of the statute. Con- trary to the government’s argument, § 14706(b) does not bar a particular category of officers from invoking the ex- clusion.",
"If that were the case, the statute would state that the exclusion does not apply to “an officer who previously served . . . .” There would be no reason for it to specify that the exclusion does not apply to “service performed by an of- ficer who previously served . . . .” See id. (emphasis added). Similarly, the government’s construction would also render the last clause of § 14706(b)—“for the period of ser- vice preceding the member’s service in a student status”— superfluous. Id. More specifically, if, as the government contends, the statute bars an officer who “previously served” before enrolling in advanced education, then it would have stated so. There would be no need for it to fur- ther provide “for the period of service preceding the mem- ber’s service in a student status.” Id. Indeed, the Claims Court itself acknowledged that, under the government’s construction, the final clause “could be deleted without changing the meaning because the provision already uses the word ‘previously.’” Decision, 153 Fed.",
"Cl. at 355. It similarly explained that the government’s construction was “not ideal, because it produces repetitive meaning Case: 21-2163 Document: 33 Page: 13 Filed: 08/09/2022 HIRSCH v. US 13 within the provision.” 7 Id. We agree with the court’s ob- servations. The government makes several additional arguments, all unpersuasive. First, the government argues that the “legislative history of 10 U.S.C. § 14706 precludes LTC Hirsch from the exclusion.” Appellee’s Br. 47–48 (cap- italization modified). Specifically, the government points to earlier versions of the statute that omitted the final clause, “for the period of service preceding the member’s service in a student status.” See H.R. 1401 at 39, 106th Cong. § 514 (1999); S. 1059 at 135–36, 106th Cong. § 519 (1999). 8 According to the government, those earlier ver- sions conveyed Congress’s intent to preclude officers with service prior to their advanced education from the exclu- sion. We disagree with the government. “Absent a clearly expressed legislative intention to the contrary, [the stat- ute’s] language must ordinarily be regarded as conclusive.” See Consumer Prod. Safety Comm’n, 447 U.S. at 108.",
"Here, the government fails to point to a legislative intention con- trary to the statute’s plain language. Certainly, earlier versions of the statute omitted the final clause, “for the pe- riod of service preceding the member’s service in a student status.” Importantly, however, Congress did not enact those earlier versions. Instead, it enacted a version that included the final clause. Accordingly, we must assume that Congress added this language with a purpose, namely, to clarify which period of service is not subject to the exclu- sion. See Taylor v. United States, 495 U.S. 575, 597 (1990) 7 The court still determined that the government’s construction was “the most natural syntactical reading of the language.” Decision, 153 Fed.",
"Cl. at 355. 8 Available at https://www.congress.gov/106/bills/ hr1401/BILLS-106hr1401ih.pdf and https://www.con- gress.gov/106/bills/s1059/BILLS-106s1059pp.pdf. Case: 21-2163 Document: 33 Page: 14 Filed: 08/09/2022 14 HIRSCH v. US (“We must assume that Congress had a purpose in adding the word ‘burglary’ to [the statute].”); GPX Int’l Tire Corp. v. United States, 678 F.3d 1308, 1312 (Fed. Cir. 2012) (“[A] statute cannot be interpreted in a manner that would ‘ne- gate[] its recent revision, and indeed would render it [] largely meaningless.’”) (quoting Rumsfeld v. Forum for Acad. & Institutional Rts., 547 U.S. 47, 57–58 (2006) (al- terations in original)). Moreover, the government’s inter- pretation under which “the final phrase could be deleted without changing the meaning,” Decision, 153 Fed.",
"Cl. at 355, is inconsistent with the legislative history. Second, the government contends that LTC Hirsch’s construction is illogical. According to the government, the statute already clarifies that the exclusion applies to an of- ficer’s service during an advanced education program (as long as the officer’s service meets additional requirements). Thus, in the government’s view, it would be pointless for the statute to further clarify that the exclusion does not apply to an officer’s service before the advanced education program. We disagree with the government. LTC Hirsch’s con- struction makes sense in view of “the broader context of the statute as a whole.” Momenta Pharms., 686 F.3d at 1354 (quoting Robinson, 519 U.S. at 341).",
"As explained above, § 14706(a)(3) provides that the exclusion applies to an of- ficer’s service during an advanced education program (sub- ject to additional requirements). However, some subset of officers such as LTC Hirsch may have also served prior to attending an advanced education program. Sec- tion 14706(b) makes clear that such prior service is not also subject to the exclusion. The government’s argument is thus unpersuasive. Accordingly, we construe § 14706(b) to provide that the exclusion does not apply to “the period of service preceding the member’s service in a student Case: 21-2163 Document: 33 Page: 15 Filed: 08/09/2022 HIRSCH v. US 15 status.” 9 Here that encompasses LTC Hirsch’s service in the Transportation Corps. In summary, because LTC Hirsch satisfies both the re- quirements of § 14706(a)(3) and § 14706(b), he is entitled to exclude his service during law school. CONCLUSION We have considered the government’s remaining argu- ments but find them unpersuasive.",
"For the foregoing rea- sons, we reverse the Claims Court’s judgment and remand for further proceedings consistent with this opinion. REVERSED AND REMANDED COSTS Costs to appellant. 9 Although not dispositive, this construction com- ports with the Army’s regulation concerning chaplain can- didates. See Army Reg. 165-1, 7-5(a)."
] | https://www.courtlistener.com/api/rest/v3/opinions/8205682/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case: 22-1624 Document: 13 Page: 1 Filed: 06/28/2022
NOTE: This order is nonprecedential.
United States Court of Appeals for the Federal Circuit ______________________
JUMP ROPE SYSTEMS, LLC, Plaintiff-Appellant
v.
COULTER VENTURES, LLC, dba Rogue Fitness, Defendant-Appellee ______________________
2022-1624 ______________________
Appeal from the United States District Court for the Southern District of Ohio in No. 2:18-cv-00731-MHW- CMV, Judge Michael H. Watson. ______________________
ON MOTION ______________________
Before PROST, BRYSON, and STOLL, Circuit Judges. PER CURIAM. ORDER The appellant Jump Rope Systems, LLC moves unop- posed for summary affirmance of the district court’s judg- ment, conceding that, under existing caselaw, the outcome is controlled by this court’s earlier decision in Jump Rope Systems, LLC v. Coulter Ventures, LLC, Nos. 20-2284, Case: 22-1624 Document: 13 Page: 2 Filed: 06/28/2022
2 JUMP ROPE SYSTEMS, LLC v. COULTER VENTURES, LLC
2020-2285, 2021 WL 4592276 (Fed. Cir. 2021) (affirming the Patent Trial and Appeal Board’s unpatentability deter- mination for all asserted claims). Accordingly, IT IS ORDERED THAT: (1) The motion for summary affirmance is granted. (2) Each side shall bear its own costs. FOR THE COURT
June 28, 2022 /s/ Peter R. Marksteiner Date Peter R. Marksteiner Clerk of Court
ISSUED AS A MANDATE: June 28, 2022 | 06-28-2022 | [
"Case: 22-1624 Document: 13 Page: 1 Filed: 06/28/2022 NOTE: This order is nonprecedential. United States Court of Appeals for the Federal Circuit ______________________ JUMP ROPE SYSTEMS, LLC, Plaintiff-Appellant v. COULTER VENTURES, LLC, dba Rogue Fitness, Defendant-Appellee ______________________ 2022-1624 ______________________ Appeal from the United States District Court for the Southern District of Ohio in No. 2:18-cv-00731-MHW- CMV, Judge Michael H. Watson. ______________________ ON MOTION ______________________ Before PROST, BRYSON, and STOLL, Circuit Judges. PER CURIAM. ORDER The appellant Jump Rope Systems, LLC moves unop- posed for summary affirmance of the district court’s judg- ment, conceding that, under existing caselaw, the outcome is controlled by this court’s earlier decision in Jump Rope Systems, LLC v. Coulter Ventures, LLC, Nos.",
"20-2284, Case: 22-1624 Document: 13 Page: 2 Filed: 06/28/2022 2 JUMP ROPE SYSTEMS, LLC v. COULTER VENTURES, LLC 2020-2285, 2021 WL 4592276 (Fed. Cir. 2021) (affirming the Patent Trial and Appeal Board’s unpatentability deter- mination for all asserted claims). Accordingly, IT IS ORDERED THAT: (1) The motion for summary affirmance is granted. (2) Each side shall bear its own costs. FOR THE COURT June 28, 2022 /s/ Peter R. Marksteiner Date Peter R. Marksteiner Clerk of Court ISSUED AS A MANDATE: June 28, 2022"
] | https://www.courtlistener.com/api/rest/v3/opinions/6495697/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
NOT RECOMMENDED FOR FULL-TEXT PUBLICATION File Name: 18a0256n.06
No. 17-5222
UNITED STATES COURT OF APPEALS FILED FOR THE SIXTH CIRCUIT May 24, 2018 DEBORAH S. HUNT, Clerk UNITED STATES OF AMERICA, ) ) Plaintiff-Appellee, ) ON APPEAL FROM THE ) UNITED STATES DISTRICT v. ) COURT FOR THE EASTERN ) DISTRICT OF TENNESSEE JEFFERY EARL HALL, ) ) Defendant-Appellant. ) )
BEFORE: GIBBONS, WHITE, and STRANCH, Circuit Judges.
JULIA SMITH GIBBONS, Circuit Judge. Jeffrey Hall appeals the district court’s
revocation of his supervised release and sentence of 51 months’ incarceration. In 2001, Hall was
convicted of a Class A felony based on his then-designation as an armed career criminal. Based
on this original conviction, the district court found that the maximum sentence upon supervised
release revocation was five years. 18 U.S.C. § 3583(e)(3). Hall argues that in light of the
Supreme Court’s decision in Johnson v. United States, 135 S. Ct. 2551 (2015), which applies
retroactively in cases on collateral review, Welch v. United States, 136 S. Ct. 1257, 1268 (2016),
he should not have been categorized as an armed career criminal. Thus, his original conviction
should have been of a Class C felony, which carries a statutory maximum of two years’
incarceration upon revocation of supervised release. Hall therefore argues for the first time in
this appeal that the district court’s sentence of 51 months was over the statutorily allowed
maximum. No. 17-5222, United States v. Hall
We hold that because Hall did not raise this argument at his supervised release revocation
sentencing, he has forfeited any error. Moreover, generally, an original conviction may not be
collaterally attacked at a supervised release revocation hearing. Instead, if Hall wishes to
challenge his designation as an armed career criminal for his 2001 conviction, the proper avenue
is a 28 U.S.C. § 2255 petition. Accordingly, we affirm the district court.
I.
In 2001, Jeffrey Hall pled guilty to possessing a firearm as a convicted felon, in violation
of 18 U.S.C. § 922(g). At the time of this conviction, Hall was classified as an armed career
criminal based on five prior Tennessee convictions: two burglaries, two aggravated burglaries,
and one third-degree burglary. Thus, Hall’s conviction was for a Class A felony. He was
sentenced to 188 months’ incarceration and 3 years’ supervised release. Hall completed his
custodial sentence in February 2015, but in 2016, Hall violated the terms of his supervised
release. Under 18 U.S.C. § 3583(e)(3), when supervised release for a Class A felony is revoked,
the maximum sentence is five years in prison. Accordingly, when the district court revoked
Hall’s supervised release, it sentenced him to 51 months’ imprisonment, followed by one year of
supervised release.1
In June 2015, four months after Hall was released from custody, the Supreme Court
issued its decision in Johnson, 135 S. Ct. 2551. Under Johnson, Hall arguably no longer
qualifies as an armed career criminal based on his prior convictions. Hall, however, did not raise
any such argument in his supervised release revocation hearing. Instead, he argues for the first
time in this appeal that, under Johnson, his 2001 conviction would have been of a Class C felony
without this armed career criminal designation. This, he argues, would invalidate his sentence in
1 The court thereafter amended its judgment to reduce the term of supervised release to 9 months.
2 No. 17-5222, United States v. Hall
this case, as when supervised release is revoked for a Class C felony, the sentence cannot exceed
more than two years’ imprisonment. 18 U.S.C. § 3583(e)(3).
II.
Where a defendant concedes that he failed to raise an objection to his sentence in the
district court, he has forfeited the claim. See United States v. Mabee, 765 F.3d 666, 671 (6th Cir.
2014). Hall concedes that he failed to object to his sentence in the district court, but he argues
that this court should still reach the merits of his argument under the plain error standard. See
Fed. R. Crim. P. 51, 52(b); United States v. Oliver, 397 F.3d 369, 377–78 (6th Cir. 2005)
(reviewing sentencing challenges raised for the first time on appeal for plain error). However,
this court is not required to review sentencing errors alleged for the first time on appeal under
Federal Rules of Criminal Procedure 52(b). See United States v. Olano, 507 U.S. 725, 735
(1993). Rather, “[o]ur authority to remedy a ‘plain error’ is discretionary.” Oliver, 397 F.3d at
375. We decline to rule on the merits of Hall’s argument and find that it has been forfeited.
III.
Furthermore, even were we to employ our discretion to consider Hall’s argument, our
precedent indicates that such a challenge to his original armed career criminal designation may
be inappropriate in this proceeding. This circuit has consistently held that a defendant may not
“attempt to invalidate his original conviction at a supervised release revocation hearing.” United
States v. Lewis, 498 F.3d 393, 395 (6th Cir. 2007) (quoting United States v. Meacham, 65 F.
App’x 529, 533 (6th Cir. 2003)); see also, e.g., United States v. Strickland, 597 F. App’x 854,
857 (6th Cir. 2015); United States v. Hallom, 505 F. App’x 480, 481 (6th Cir. 2012); United
States v. Flanory, 45 F. App’x 456, 459–60 (6th Cir. 2002).2 The reasoning behind this rule is
2 Other circuits also bar collateral attacks of an original conviction in a supervised release revocation hearing. See, e.g., United States v. Miller, 557 F.3d 910, 913 (8th Cir. 2009); United States v. Warren, 335 F.3d 76,
3 No. 17-5222, United States v. Hall
that the appropriate vehicle for collaterally attacking the validity of a federal sentence or
conviction is through a motion under 28 U.S.C. § 2255. See Meacham, 65 F. App’x at 532. This
makes sense, as sentencing after revocation of supervised release is governed by 18 U.S.C.
§ 3583(e), which directs the court to apply certain 18 U.S.C § 3553(a) factors, and nothing in
these factors indicates that the district court should consider the validity of the original
conviction when deciding sentencing after revocation of a supervised release. See 18 U.S.C
§ 3553. In fact, the statute excludes consideration of the seriousness of the original crime as a
factor. See Strickland, 597 F. App’x at 857. This indicates that a revocation hearing is not the
appropriate forum to reconsider the original conviction.
Indeed, the Third Circuit found Hall’s exact argument here to be an impermissible
collateral attack on an original conviction. See United States v. Jones, 833 F.3d 341 (3d Cir.
2016). In Jones, the defendant also argued that because he no longer qualified as an armed
career criminal under Johnson, his sentence of 40 months upon the revocation of his supervised
release exceeded the two-year statutory maximum. Id. at 343. That court concluded that “[e]ven
if Jones were correct that his original offense would not include an armed career criminal
designation under current law, it would have no effect on his revocation sentence because the
District Court is not tasked under Section 3583(e) with reconsidering an offender’s status as an
armed career criminal.” Id. at 344. Although Jones is not binding on us, it is highly persuasive.
Hall asks this court to draw on a line of cases that, he claims, allow collateral challenges
to an original conviction for purely legal issues. The two cases he points to are United States v.
Garcia-Hernandez, 74 F. App’x 412 (5th Cir. 2003), and United States v. Justin D., 156 F.
App’x 936 (9th Cir. 2005). Neither of these cases helps Hall’s argument. In Garcia-Hernandez,
78 (2d Cir. 2003); United States v. Pregent, 190 F.3d 279, 283 (4th Cir. 1999); United States v. Almand, 992 F.2d 316, 317–18 (11th Cir. 1993); United States v. Simmons, 812 F.2d 561, 563 (9th Cir. 1987); United States v. Torrez- Flores, 624 F.2d 776, 780 (7th Cir. 1980).
4 No. 17-5222, United States v. Hall
that court explicitly declined to address whether the appeal was an impermissible collateral
attack on the original conviction. Garcia-Hernandez, 74 F. App’x at 414–15 (“declin[ing] to
address this question” because Garcia’s challenge would fail on the merits). And in Justin D.,
the court stated that the defendant was “attacking the sufficiency of the underlying information,
not just the underlying conviction,” which is “a fundamental defect which can be raised at any
time.” Justin D., 156 F. App’x at 937. We know of no case indicating that an erroneous
designation as an armed career criminal is a similar “fundamental defect which can be raised at
any time.” See id. Furthermore, this circuit has not drawn any line allowing certain collateral
attacks to an original conviction but not others and drawing such a line could lead to confusion
and inefficiency. Accordingly, we hesitate to create an exception to the general rule barring
collateral attacks of an original conviction at a supervised release revocation hearing.
This does not mean, however, that Hall is without means to challenge his sentence. Hall
could instead file a § 2255 motion to challenge his original conviction. In such a situation, any
revocation proceedings could be stayed in order to expedite resolution of the underlying legal
issue in the habeas proceeding. This would ensure that the defendant is properly sentenced upon
revocation of his supervised release. Here, the parties have every reason to efficiently and justly
resolve this issue, as Hall’s Johnson argument may have merit.
IV.
Because Hall raises his sentencing objection for the first time on appeal, we decline to
address Hall’s claim on the merits. Additionally, case law—from both within and outside this
circuit—forbidding collateral review of the original conviction at a supervised release revocation
hearing supports our decision to not review Hall’s argument here. We therefore affirm the
district court’s sentence of 51 months.
5 | 05-24-2018 | [
"NOT RECOMMENDED FOR FULL-TEXT PUBLICATION File Name: 18a0256n.06 No. 17-5222 UNITED STATES COURT OF APPEALS FILED FOR THE SIXTH CIRCUIT May 24, 2018 DEBORAH S. HUNT, Clerk UNITED STATES OF AMERICA, ) ) Plaintiff-Appellee, ) ON APPEAL FROM THE ) UNITED STATES DISTRICT v. ) COURT FOR THE EASTERN ) DISTRICT OF TENNESSEE JEFFERY EARL HALL, ) ) Defendant-Appellant. ) ) BEFORE: GIBBONS, WHITE, and STRANCH, Circuit Judges. JULIA SMITH GIBBONS, Circuit Judge. Jeffrey Hall appeals the district court’s revocation of his supervised release and sentence of 51 months’ incarceration. In 2001, Hall was convicted of a Class A felony based on his then-designation as an armed career criminal. Based on this original conviction, the district court found that the maximum sentence upon supervised release revocation was five years. 18 U.S.C. § 3583(e)(3).",
"Hall argues that in light of the Supreme Court’s decision in Johnson v. United States, 135 S. Ct. 2551 (2015), which applies retroactively in cases on collateral review, Welch v. United States, 136 S. Ct. 1257, 1268 (2016), he should not have been categorized as an armed career criminal. Thus, his original conviction should have been of a Class C felony, which carries a statutory maximum of two years’ incarceration upon revocation of supervised release. Hall therefore argues for the first time in this appeal that the district court’s sentence of 51 months was over the statutorily allowed maximum.",
"No. 17-5222, United States v. Hall We hold that because Hall did not raise this argument at his supervised release revocation sentencing, he has forfeited any error. Moreover, generally, an original conviction may not be collaterally attacked at a supervised release revocation hearing. Instead, if Hall wishes to challenge his designation as an armed career criminal for his 2001 conviction, the proper avenue is a 28 U.S.C. § 2255 petition. Accordingly, we affirm the district court. I.",
"In 2001, Jeffrey Hall pled guilty to possessing a firearm as a convicted felon, in violation of 18 U.S.C. § 922(g). At the time of this conviction, Hall was classified as an armed career criminal based on five prior Tennessee convictions: two burglaries, two aggravated burglaries, and one third-degree burglary. Thus, Hall’s conviction was for a Class A felony. He was sentenced to 188 months’ incarceration and 3 years’ supervised release. Hall completed his custodial sentence in February 2015, but in 2016, Hall violated the terms of his supervised release. Under 18 U.S.C. § 3583(e)(3), when supervised release for a Class A felony is revoked, the maximum sentence is five years in prison. Accordingly, when the district court revoked Hall’s supervised release, it sentenced him to 51 months’ imprisonment, followed by one year of supervised release.1 In June 2015, four months after Hall was released from custody, the Supreme Court issued its decision in Johnson, 135 S. Ct. 2551.",
"Under Johnson, Hall arguably no longer qualifies as an armed career criminal based on his prior convictions. Hall, however, did not raise any such argument in his supervised release revocation hearing. Instead, he argues for the first time in this appeal that, under Johnson, his 2001 conviction would have been of a Class C felony without this armed career criminal designation. This, he argues, would invalidate his sentence in 1 The court thereafter amended its judgment to reduce the term of supervised release to 9 months. 2 No. 17-5222, United States v. Hall this case, as when supervised release is revoked for a Class C felony, the sentence cannot exceed more than two years’ imprisonment.",
"18 U.S.C. § 3583(e)(3). II. Where a defendant concedes that he failed to raise an objection to his sentence in the district court, he has forfeited the claim. See United States v. Mabee, 765 F.3d 666, 671 (6th Cir. 2014). Hall concedes that he failed to object to his sentence in the district court, but he argues that this court should still reach the merits of his argument under the plain error standard. See Fed. R. Crim. P. 51, 52(b); United States v. Oliver, 397 F.3d 369, 377–78 (6th Cir.",
"2005) (reviewing sentencing challenges raised for the first time on appeal for plain error). However, this court is not required to review sentencing errors alleged for the first time on appeal under Federal Rules of Criminal Procedure 52(b). See United States v. Olano, 507 U.S. 725, 735 (1993). Rather, “[o]ur authority to remedy a ‘plain error’ is discretionary.” Oliver, 397 F.3d at 375. We decline to rule on the merits of Hall’s argument and find that it has been forfeited. III. Furthermore, even were we to employ our discretion to consider Hall’s argument, our precedent indicates that such a challenge to his original armed career criminal designation may be inappropriate in this proceeding. This circuit has consistently held that a defendant may not “attempt to invalidate his original conviction at a supervised release revocation hearing.” United States v. Lewis, 498 F.3d 393, 395 (6th Cir. 2007) (quoting United States v. Meacham, 65 F. App’x 529, 533 (6th Cir. 2003)); see also, e.g., United States v. Strickland, 597 F. App’x 854, 857 (6th Cir. 2015); United States v. Hallom, 505 F. App’x 480, 481 (6th Cir.",
"2012); United States v. Flanory, 45 F. App’x 456, 459–60 (6th Cir. 2002).2 The reasoning behind this rule is 2 Other circuits also bar collateral attacks of an original conviction in a supervised release revocation hearing. See, e.g., United States v. Miller, 557 F.3d 910, 913 (8th Cir. 2009); United States v. Warren, 335 F.3d 76, 3 No. 17-5222, United States v. Hall that the appropriate vehicle for collaterally attacking the validity of a federal sentence or conviction is through a motion under 28 U.S.C. § 2255. See Meacham, 65 F. App’x at 532. This makes sense, as sentencing after revocation of supervised release is governed by 18 U.S.C. § 3583(e), which directs the court to apply certain 18 U.S.C § 3553(a) factors, and nothing in these factors indicates that the district court should consider the validity of the original conviction when deciding sentencing after revocation of a supervised release. See 18 U.S.C § 3553.",
"In fact, the statute excludes consideration of the seriousness of the original crime as a factor. See Strickland, 597 F. App’x at 857. This indicates that a revocation hearing is not the appropriate forum to reconsider the original conviction. Indeed, the Third Circuit found Hall’s exact argument here to be an impermissible collateral attack on an original conviction. See United States v. Jones, 833 F.3d 341 (3d Cir. 2016). In Jones, the defendant also argued that because he no longer qualified as an armed career criminal under Johnson, his sentence of 40 months upon the revocation of his supervised release exceeded the two-year statutory maximum. Id. at 343. That court concluded that “[e]ven if Jones were correct that his original offense would not include an armed career criminal designation under current law, it would have no effect on his revocation sentence because the District Court is not tasked under Section 3583(e) with reconsidering an offender’s status as an armed career criminal.” Id.",
"at 344. Although Jones is not binding on us, it is highly persuasive. Hall asks this court to draw on a line of cases that, he claims, allow collateral challenges to an original conviction for purely legal issues. The two cases he points to are United States v. Garcia-Hernandez, 74 F. App’x 412 (5th Cir. 2003), and United States v. Justin D., 156 F. App’x 936 (9th Cir.",
"2005). Neither of these cases helps Hall’s argument. In Garcia-Hernandez, 78 (2d Cir. 2003); United States v. Pregent, 190 F.3d 279, 283 (4th Cir. 1999); United States v. Almand, 992 F.2d 316, 317–18 (11th Cir. 1993); United States v. Simmons, 812 F.2d 561, 563 (9th Cir. 1987); United States v. Torrez- Flores, 624 F.2d 776, 780 (7th Cir. 1980). 4 No. 17-5222, United States v. Hall that court explicitly declined to address whether the appeal was an impermissible collateral attack on the original conviction.",
"Garcia-Hernandez, 74 F. App’x at 414–15 (“declin[ing] to address this question” because Garcia’s challenge would fail on the merits). And in Justin D., the court stated that the defendant was “attacking the sufficiency of the underlying information, not just the underlying conviction,” which is “a fundamental defect which can be raised at any time.” Justin D., 156 F. App’x at 937. We know of no case indicating that an erroneous designation as an armed career criminal is a similar “fundamental defect which can be raised at any time.” See id. Furthermore, this circuit has not drawn any line allowing certain collateral attacks to an original conviction but not others and drawing such a line could lead to confusion and inefficiency.",
"Accordingly, we hesitate to create an exception to the general rule barring collateral attacks of an original conviction at a supervised release revocation hearing. This does not mean, however, that Hall is without means to challenge his sentence. Hall could instead file a § 2255 motion to challenge his original conviction. In such a situation, any revocation proceedings could be stayed in order to expedite resolution of the underlying legal issue in the habeas proceeding. This would ensure that the defendant is properly sentenced upon revocation of his supervised release. Here, the parties have every reason to efficiently and justly resolve this issue, as Hall’s Johnson argument may have merit. IV. Because Hall raises his sentencing objection for the first time on appeal, we decline to address Hall’s claim on the merits.",
"Additionally, case law—from both within and outside this circuit—forbidding collateral review of the original conviction at a supervised release revocation hearing supports our decision to not review Hall’s argument here. We therefore affirm the district court’s sentence of 51 months. 5"
] | https://www.courtlistener.com/api/rest/v3/opinions/4278173/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
V 112th CONGRESS 1st Session H. R. 259 IN THE HOUSE OF REPRESENTATIVES January 7, 2011 Mr. King of New York introduced the following bill; which was referred to the Committee on the Judiciary A BILL For the relief of Alemseghed Mussie Tesfamical. 1.Permanent resident status for Alemseghed Mussie Tesfamical (a)In generalNotwithstanding subsections (a) and (b) of section 201 of the Immigration and Nationality Act, Alemseghed Mussie Tesfamical shall be eligible for issuance of an immigrant visa or for adjustment of status to that of an alien lawfully admitted for permanent residence upon filing an application for issuance of an immigrant visa under section 204 of such Act or for adjustment of status to lawful permanent resident. (b)Adjustment of statusIf Alemseghed Mussie Tesfamical enters the United States before the filing deadline specified in subsection (c), he shall be considered to have entered and remained lawfully and shall, if otherwise eligible, be eligible for adjustment of status under section 245 of the Immigration and Nationality Act as of the date of the enactment of this Act. (c)Deadline for application and payment of feesSubsections (a) and (b) shall apply only if the application for issuance of an immigrant visa or the application for adjustment of status is filed with appropriate fees within 2 years after the date of the enactment of this Act. (d)Reduction of immigrant visa numberUpon the granting of an immigrant visa or permanent residence to Alemseghed Mussie Tesfamical, the Secretary of State shall instruct the proper officer to reduce by 1, during the current or next following fiscal year, the total number of immigrant visas that are made available to natives of the country of the alien’s birth under section 203(a) of the Immigration and Nationality Act or, if applicable, the total number of immigrant visas that are made available to natives of the country of the alien’s birth under section 202(e) of such Act. (e)Denial of preferential immigration treatment for certain relativesThe natural parents, brothers, and sisters of Alemseghed Mussie Tesfamical shall not, by virtue of such relationship, be accorded any right, privilege, or status under the Immigration and Nationality Act. | 01-07-2011 | [
"V 112th CONGRESS 1st Session H. R. 259 IN THE HOUSE OF REPRESENTATIVES January 7, 2011 Mr. King of New York introduced the following bill; which was referred to the Committee on the Judiciary A BILL For the relief of Alemseghed Mussie Tesfamical. 1.Permanent resident status for Alemseghed Mussie Tesfamical (a)In generalNotwithstanding subsections (a) and (b) of section 201 of the Immigration and Nationality Act, Alemseghed Mussie Tesfamical shall be eligible for issuance of an immigrant visa or for adjustment of status to that of an alien lawfully admitted for permanent residence upon filing an application for issuance of an immigrant visa under section 204 of such Act or for adjustment of status to lawful permanent resident. (b)Adjustment of statusIf Alemseghed Mussie Tesfamical enters the United States before the filing deadline specified in subsection (c), he shall be considered to have entered and remained lawfully and shall, if otherwise eligible, be eligible for adjustment of status under section 245 of the Immigration and Nationality Act as of the date of the enactment of this Act.",
"(c)Deadline for application and payment of feesSubsections (a) and (b) shall apply only if the application for issuance of an immigrant visa or the application for adjustment of status is filed with appropriate fees within 2 years after the date of the enactment of this Act. (d)Reduction of immigrant visa numberUpon the granting of an immigrant visa or permanent residence to Alemseghed Mussie Tesfamical, the Secretary of State shall instruct the proper officer to reduce by 1, during the current or next following fiscal year, the total number of immigrant visas that are made available to natives of the country of the alien’s birth under section 203(a) of the Immigration and Nationality Act or, if applicable, the total number of immigrant visas that are made available to natives of the country of the alien’s birth under section 202(e) of such Act. (e)Denial of preferential immigration treatment for certain relativesThe natural parents, brothers, and sisters of Alemseghed Mussie Tesfamical shall not, by virtue of such relationship, be accorded any right, privilege, or status under the Immigration and Nationality Act."
] | https://www.govinfo.gov/content/pkg/BILLS-112hr259ih/xml/BILLS-112hr259ih.xml | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
99th Ave. Holdings, LLC v TSI Hell's Kitchen, LLC (2022 NY Slip Op 06737)
99th Ave. Holdings, LLC v TSI Hell's Kitchen, LLC
2022 NY Slip Op 06737
Decided on November 29, 2022
Appellate Division, First Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
Decided and Entered: November 29, 2022
Before: Acosta, P.J., Kern, Singh, Scarpulla, Pitt, JJ.
Index No. 655667/20 Appeal No. 16751-16752-16752A Case No. 2021-03005, 2022-00001, 2022-00245
[*1]99th Avenue Holdings, LLC, Plaintiff-Respondent, vTSI Hell's Kitchen, LLC, Defendant-Appellant, New York Communications Center Associates, LP, et al., Defendants.
Akerman LLP, New York (Robert Chester of counsel), for appellant. Thomas D. Shanahan, P.C., New York (Thomas D. Shanahan of counsel), for respondent.
Judgment, Supreme Court, New York County (Arthur F. Engoron, J.), entered August 11, 2021, in favor of plaintiff and against defendant TSI Hell's Kitchen, LLC in the amount of $252,264.38, unanimously affirmed, without costs. Appeal from order, same court and Justice, entered July 22, 2021, which granted plaintiff's motion for summary judgment and denied TSI's motion for summary judgment, unanimously dismissed, without costs, as subsumed in the appeal from the judgment. Order, same court and Justice, entered on or about December 20, 2021, which, to the extent appealed from, granted defendant's motion to reargue and, upon reargument, adhered to its prior determination, unanimously affirmed, without costs. The assignment of lease from plaintiff to TSI and their asset purchase agreement (APA) contained obligations that both plaintiff and TSI were required to fulfill. Plaintiff was required to procure a temporary certificate of occupancy (TCO) and secure it with a deposit to the landlord in the amount of $250,000. TSI was required to maintain the tenancy in good standing by, among other things, paying rent until the TCO was procured. The court correctly decided the parties' motions for summary judgment. It is undisputed that TSI failed to pay rent for several months in 2020, resulting in arrears of more than $1 million by the time plaintiff procured the TCO. Because TSI allowed the arrears to accrue, which resulted in the landlord withholding the TCO deposit, TSI breached the agreements and plaintiff was damaged in an amount of $250,000. Contrary to TSI's position, the APA's own language in sections 1.2 and 8.2, reinforced by paragraph 5 of the assignment agreement, required TSI to keep the tenancy in good standing, even after closing. We have considered TSI's remaining arguments and find them unavailing.THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT. ENTERED: November 29, 2022 | 11-29-2022 | [
"99th Ave. Holdings, LLC v TSI Hell's Kitchen, LLC (2022 NY Slip Op 06737) 99th Ave. Holdings, LLC v TSI Hell's Kitchen, LLC 2022 NY Slip Op 06737 Decided on November 29, 2022 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the Official Reports. Decided and Entered: November 29, 2022 Before: Acosta, P.J., Kern, Singh, Scarpulla, Pitt, JJ. Index No. 655667/20 Appeal No. 16751-16752-16752A Case No. 2021-03005, 2022-00001, 2022-00245 [*1]99th Avenue Holdings, LLC, Plaintiff-Respondent, vTSI Hell's Kitchen, LLC, Defendant-Appellant, New York Communications Center Associates, LP, et al., Defendants.",
"Akerman LLP, New York (Robert Chester of counsel), for appellant. Thomas D. Shanahan, P.C., New York (Thomas D. Shanahan of counsel), for respondent. Judgment, Supreme Court, New York County (Arthur F. Engoron, J. ), entered August 11, 2021, in favor of plaintiff and against defendant TSI Hell's Kitchen, LLC in the amount of $252,264.38, unanimously affirmed, without costs. Appeal from order, same court and Justice, entered July 22, 2021, which granted plaintiff's motion for summary judgment and denied TSI's motion for summary judgment, unanimously dismissed, without costs, as subsumed in the appeal from the judgment. Order, same court and Justice, entered on or about December 20, 2021, which, to the extent appealed from, granted defendant's motion to reargue and, upon reargument, adhered to its prior determination, unanimously affirmed, without costs. The assignment of lease from plaintiff to TSI and their asset purchase agreement (APA) contained obligations that both plaintiff and TSI were required to fulfill.",
"Plaintiff was required to procure a temporary certificate of occupancy (TCO) and secure it with a deposit to the landlord in the amount of $250,000. TSI was required to maintain the tenancy in good standing by, among other things, paying rent until the TCO was procured. The court correctly decided the parties' motions for summary judgment. It is undisputed that TSI failed to pay rent for several months in 2020, resulting in arrears of more than $1 million by the time plaintiff procured the TCO. Because TSI allowed the arrears to accrue, which resulted in the landlord withholding the TCO deposit, TSI breached the agreements and plaintiff was damaged in an amount of $250,000. Contrary to TSI's position, the APA's own language in sections 1.2 and 8.2, reinforced by paragraph 5 of the assignment agreement, required TSI to keep the tenancy in good standing, even after closing. We have considered TSI's remaining arguments and find them unavailing.THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT. ENTERED: November 29, 2022"
] | https://www.courtlistener.com/api/rest/v3/opinions/9297051/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
WEDLBOEN, District Judge. The court having heretofore announced its findings in favor of petitioners, so far as concerns the acts of bankruptcy charged in the petition, the only question now to be disposed of is whether or not respondent is such a corporation as may be adjudged an involuntary bankrupt; or, more specifically, whether or not respondent is a corporation “engaged principally in manufacturing, trading, printing, publishing, or mercantile pursuits.” The purposes for which respondent was formed are set forth in its articles of incorporation as follows: “(1) To acquire by construction, purchase, exchange, or other means, and thereafter to own, maintain, operate, and carry on, or to sell or otherwise dispose of sanatoriums and other establishments suitable for the care and treatment of tlie sick. (2) To acquire by purchase or other means, and thereafter use and employ, or to sell or otherwise dispose of pneumo-chemic and other systems fer the treatment of persons afflicted with tuberculosis- and other diseases. (3) To acquire, own, hold, soil, convey, and mortgage such real and personal property as may be necessary, proper, or convenient in carrying on the business of the corporation.” A circular letter issued and distributed by respondent contains the following statement as to its location: “The San Gabriel Sanatorium is delightfully located between the cities of Los Angeles and Pasadena. It is surrounded with six acres of fine lawn, shaded with live oak, orange, palm, and other tropical and semitropical trees and shrubs in profusion. The building has one hundred comfortable, furnished rooms, heated by steam and lighted with gas, together with a climate that is unsurpassed, making an ideal spot for a health-seeker.” Hie circular letter already mentioned describes the character of respondent’s business, as follows: *272“Our system of treatment is that of filling the apartments of each patient with an antiseptic germicidal air by means of an evaporator, which has a capacity sufficient to saturate the air continually. In addition to this, fresh air'is forced through a battery of cylinders containing the antiseptic germicidal fluid, consisting of oil of tar, oil of eucalyptus, thymol, 'menthol, pine tar, permanganate of potash,' and carbolic acid. After passing through the fluid, the moisture is extracted. This gives us practically a dry, medicated air, which is conveyed to the apartment of each patient in sufficient quantities to maintain the normal amount of oxygen to meet the requirements of the nutritive function. In this atmosphere- the patient is asked to practice forced inhalations and forced exhalations, under proper directions, and soon the following results are observed: The physical examination shows that the lungs are clearing up, the respirations approaching normal,” etc. “The treatment of phthisical patients by inhalation is not only rational and practicable, but it is strictly in harmony with therapeutic law. By this means of administration it is not irritating, and the air is so thoroughly impregnated that the medicaments must reach every portion of the lung tissue that air in any form can reach.” In another publication made by it, respondent refers to its location, and characterizes its business thus: “This system of treatment is administered under the direction of the National Pulmonary Company, and is in operation at San Gabriel Sanatorium, San Gabriel, California, near Los Angeles, and at other points. The San Gabriel Sanatorium is owned and operated by the San Gabriel Sanatorium Company. The 'sanatorium is lighted with gas and heated by steam and open fires. The rooms, over one hundred in number, are cheerful, sunny, and well furnished. Many suites have private baths. The sanatorium is delightfully located, surrounded by twelve acres of land, fruit trees, and shrubs. A billiard room, lawn tennis court, and croquet grounds are free for the use of patients. * * # yye desire to call particular attention to the salutary influence of the stimulating antiseptic vapor on the ulceration consequent to the tubercular process. Every physician must have noticed the rapid decline of phthisical patients where a large quantity of purulent matter was expectorated — direct proof of extensive ulceration. * * * We recognize the importance of creating within the lungs and -air passages a medium in which the pathogenic germ cannot li.ve or thrive, by the continuous inhalation of a sterilizing vapor, and at the same time of increasing the resisting power of the body, by proper exercise, good’ food, tonics, etc. This is accomplished under our method as follows: First. In the apartment of each patient there is placed one of our vaporizers which is of sufficient capacity to saturate the air of a room, night and day, by evaporation. Second. Fresh air is drawn from the outer atmosphere, high above the earth’s surface by an air pump, and forced, under moderate pressure, through a system of piping into the room of each patient, where it is expelled into the antiseptic fluid contained in the evaporizer. This fresh air becomes thoroughly impregnated with the sterilizing properties of the antiseptic fluid, and is introduced into the room in quantities sufficient to maintain the normal proportion of oxygen to meet the requirements of the system. In this atmosphere the patient sleeps, and at intervals during the day practices breathing exercises as prescribed. Third. A special treatment room is provided where the vaporized antiseptic is more concentrated than is needed in the living apartments. In this ‘strong room’ the patients practice breathing exercises for twenty,minutes three times a day. Fourth. Pulmonary gymnastics and proper exercises are prescribed and practiced. In cases where there are complications, they are treated according to the laws of regular medicine.” The proof shows that respondent’s institution is not a charity, but conducted on the lines indicated in the foregoing extracts, and for profit. Patients are lodged and furnished with the usual accommodations of a hotel at the sanatorium, the rates charged being $25 per week, and upward. Cigars are kept on sale at the sanatorium by the respondent for the benefit of those who desire them.' Petitioners furnished cigars and groceries to respondent for use at its sanatorium. *273Section 4 of the bankrupt act is as follows: “San. 4. Who Alay Become. Bankrupts, a. Any person who owes debts, except a corporation, shall be entitled to the benefits of this act as a voluntary bankrupt, b. Any natural person, except a wage-earner or a person engaged chiefly in farming or the tillage of the soil, any unincorporated company, and any corporation engaged principally in manufacturing, trading, printing, publishing, or mercantile pursuits, owing debts to the amount of one thousand dolíais or over, may be adjudged an Involuntary bankrupt upon default or an impartial trial, and shall be subject to the provisions and entitled to the benefits of this act. Private bankers, but not national banks or banks incorporated under state or territorial laws, may be adjudged Involuntary bankrupts.” While the artificial atmosphere used at respondent’s sanatorium is doubtless the product of a manufacturing process, I am not prepared to hold that manufacturing' is respondent’s principal business. Nor is there any proof showing that respondent’s business is that of printing or publishing. I am of the opinion, however, that respondent may be properly classified as a trading or mercantile corporation; that is, a corporation principally engaged in trading or mercantile pursuits. To the proposition that “a corporation created for the purpose of carrying oti or pursuing any lawful business defined by its charter, and clothed with power so to do for the sake of gain, is clearly a business corporation, and amenable to the provisions of the bankruptcy act,” pettioners cite: Bump, Bankr. p. 773; Railroad Co. v. Jones, 1 Fed. Cas. 275; Adams v. Railroad Co., Id. 91; Rankin v. Railroad Co., 20 Fed. Cas. 274. These authorities, however, are interpretations of the bankruptcy act of 1867, of which section 37 is as follows: “flee. 37. And be it further enacted that the provisions of this act shall apply to all moneyed, business or commercial corporations and joint stock companies,” etc. (14 Stat. 535), and, of course, are not .determinative of the meaning of the bankruptcy act of 1898; but the meaning of said last-mentioned act must be ascertained from its own peculiar phraseology. In construing said act, however, a. few general definitions will be helpful. The word “mercantile” is defined thus: “Pertaining to merchants, or the business of merchants.” Webst. Did. “A merchant” is “one whose business it is to buy and sell merchandise,” and “merchandise” is “a term including all those things which, merchants sell, either wholesale or retail, as dry goods, hardware, groceries, drugs, etc.” Bouv. Law Dict. “Merchant” includes “hotel keeper.” Campbell v. Finck, 2 Duv. 107. It has been held that one who keeps on livery, or boards, horses belonging to other persons, is a merchant. In re Odell, 18 Fed. Cas. 574. See, also, Black, Bankr. p. 82. “Trader” is thus defined: "One who makes it his business to buy merchandise or goods and chati el:', and fo sell the same for the pm pose of making a profit. The quantum of dealing is immaterial, when the intention to deal generally exists.” 3 Starkie, 515: 2 Car. & P. 135; 1 Term it. 572. The principal question is whether the person has the intention of getting a living by his trading. If this is proved, the extent or duration of the trading is not material. 3 Camp. 238; 2 Bouv. Law; Dict. 741; In re Cowles, 6 Fed. Cas. 672. A baker who buys flour and makes it into bread for sale is a trader. In re Cocks, 5 Fed. Cas. 1154. A stair-builder is a trader. In re Garrison, 10 Fed. Cas. 49. *274These authorities, I think, fairly outline the character of a merchant or trader, within the meaning of the bankruptcy law, although there are some cases which give to the words more restricted significations, as In re Smith, 22 Fed. Cas. 394. Respondent contends that, inasmuch as the ultimate object of its business is the cure of consumptives, it is not a corporation principally engaged in trading or mercantile pursuits, resting its argument largely on the word “principally,” used in section 4 of the bankruptcy act above quoted. This word “principally,” it seems to me, does not denote the object or end of a pursuit, as claimed by respondent, but is employed here to distinguish a calling, usual occupation, from an isolated single transaction. Thus, if an incorporated charity — a public free hospital, for instance — should buy a horse to be used in conveying patients to .and from the hospital, and, finding' the horse unfit for such use, should sell it, this one purchase and sale would not bring the hospital within the classification of a corporation principally engaged in trading or mercantile pursuits; but if an incorporated company such as a private hospital be conducted in a business way for profit, and not on charitable lines, it is, I think, a trading or mercantile corporation, within the meaning of the present bankruptcy law, no matter what may be the result or effects it purposes to accomplish with or upon its patrons. A decree adjudging respondent a bankrupt will be entered. | 11-26-2022 | [
"WEDLBOEN, District Judge. The court having heretofore announced its findings in favor of petitioners, so far as concerns the acts of bankruptcy charged in the petition, the only question now to be disposed of is whether or not respondent is such a corporation as may be adjudged an involuntary bankrupt; or, more specifically, whether or not respondent is a corporation “engaged principally in manufacturing, trading, printing, publishing, or mercantile pursuits.” The purposes for which respondent was formed are set forth in its articles of incorporation as follows: “(1) To acquire by construction, purchase, exchange, or other means, and thereafter to own, maintain, operate, and carry on, or to sell or otherwise dispose of sanatoriums and other establishments suitable for the care and treatment of tlie sick. (2) To acquire by purchase or other means, and thereafter use and employ, or to sell or otherwise dispose of pneumo-chemic and other systems fer the treatment of persons afflicted with tuberculosis- and other diseases.",
"(3) To acquire, own, hold, soil, convey, and mortgage such real and personal property as may be necessary, proper, or convenient in carrying on the business of the corporation.” A circular letter issued and distributed by respondent contains the following statement as to its location: “The San Gabriel Sanatorium is delightfully located between the cities of Los Angeles and Pasadena. It is surrounded with six acres of fine lawn, shaded with live oak, orange, palm, and other tropical and semitropical trees and shrubs in profusion. The building has one hundred comfortable, furnished rooms, heated by steam and lighted with gas, together with a climate that is unsurpassed, making an ideal spot for a health-seeker.” Hie circular letter already mentioned describes the character of respondent’s business, as follows: *272“Our system of treatment is that of filling the apartments of each patient with an antiseptic germicidal air by means of an evaporator, which has a capacity sufficient to saturate the air continually. In addition to this, fresh air'is forced through a battery of cylinders containing the antiseptic germicidal fluid, consisting of oil of tar, oil of eucalyptus, thymol, 'menthol, pine tar, permanganate of potash,' and carbolic acid.",
"After passing through the fluid, the moisture is extracted. This gives us practically a dry, medicated air, which is conveyed to the apartment of each patient in sufficient quantities to maintain the normal amount of oxygen to meet the requirements of the nutritive function. In this atmosphere- the patient is asked to practice forced inhalations and forced exhalations, under proper directions, and soon the following results are observed: The physical examination shows that the lungs are clearing up, the respirations approaching normal,” etc. “The treatment of phthisical patients by inhalation is not only rational and practicable, but it is strictly in harmony with therapeutic law. By this means of administration it is not irritating, and the air is so thoroughly impregnated that the medicaments must reach every portion of the lung tissue that air in any form can reach.” In another publication made by it, respondent refers to its location, and characterizes its business thus: “This system of treatment is administered under the direction of the National Pulmonary Company, and is in operation at San Gabriel Sanatorium, San Gabriel, California, near Los Angeles, and at other points.",
"The San Gabriel Sanatorium is owned and operated by the San Gabriel Sanatorium Company. The 'sanatorium is lighted with gas and heated by steam and open fires. The rooms, over one hundred in number, are cheerful, sunny, and well furnished. Many suites have private baths. The sanatorium is delightfully located, surrounded by twelve acres of land, fruit trees, and shrubs. A billiard room, lawn tennis court, and croquet grounds are free for the use of patients. * * # yye desire to call particular attention to the salutary influence of the stimulating antiseptic vapor on the ulceration consequent to the tubercular process. Every physician must have noticed the rapid decline of phthisical patients where a large quantity of purulent matter was expectorated — direct proof of extensive ulceration.",
"* * * We recognize the importance of creating within the lungs and -air passages a medium in which the pathogenic germ cannot li.ve or thrive, by the continuous inhalation of a sterilizing vapor, and at the same time of increasing the resisting power of the body, by proper exercise, good’ food, tonics, etc. This is accomplished under our method as follows: First. In the apartment of each patient there is placed one of our vaporizers which is of sufficient capacity to saturate the air of a room, night and day, by evaporation.",
"Second. Fresh air is drawn from the outer atmosphere, high above the earth’s surface by an air pump, and forced, under moderate pressure, through a system of piping into the room of each patient, where it is expelled into the antiseptic fluid contained in the evaporizer. This fresh air becomes thoroughly impregnated with the sterilizing properties of the antiseptic fluid, and is introduced into the room in quantities sufficient to maintain the normal proportion of oxygen to meet the requirements of the system. In this atmosphere the patient sleeps, and at intervals during the day practices breathing exercises as prescribed. Third.",
"A special treatment room is provided where the vaporized antiseptic is more concentrated than is needed in the living apartments. In this ‘strong room’ the patients practice breathing exercises for twenty,minutes three times a day. Fourth. Pulmonary gymnastics and proper exercises are prescribed and practiced. In cases where there are complications, they are treated according to the laws of regular medicine.” The proof shows that respondent’s institution is not a charity, but conducted on the lines indicated in the foregoing extracts, and for profit. Patients are lodged and furnished with the usual accommodations of a hotel at the sanatorium, the rates charged being $25 per week, and upward. Cigars are kept on sale at the sanatorium by the respondent for the benefit of those who desire them.'",
"Petitioners furnished cigars and groceries to respondent for use at its sanatorium. *273Section 4 of the bankrupt act is as follows: “San. 4. Who Alay Become. Bankrupts, a. Any person who owes debts, except a corporation, shall be entitled to the benefits of this act as a voluntary bankrupt, b. Any natural person, except a wage-earner or a person engaged chiefly in farming or the tillage of the soil, any unincorporated company, and any corporation engaged principally in manufacturing, trading, printing, publishing, or mercantile pursuits, owing debts to the amount of one thousand dolíais or over, may be adjudged an Involuntary bankrupt upon default or an impartial trial, and shall be subject to the provisions and entitled to the benefits of this act. Private bankers, but not national banks or banks incorporated under state or territorial laws, may be adjudged Involuntary bankrupts.” While the artificial atmosphere used at respondent’s sanatorium is doubtless the product of a manufacturing process, I am not prepared to hold that manufacturing' is respondent’s principal business. Nor is there any proof showing that respondent’s business is that of printing or publishing. I am of the opinion, however, that respondent may be properly classified as a trading or mercantile corporation; that is, a corporation principally engaged in trading or mercantile pursuits.",
"To the proposition that “a corporation created for the purpose of carrying oti or pursuing any lawful business defined by its charter, and clothed with power so to do for the sake of gain, is clearly a business corporation, and amenable to the provisions of the bankruptcy act,” pettioners cite: Bump, Bankr. p. 773; Railroad Co. v. Jones, 1 Fed. Cas. 275; Adams v. Railroad Co., Id. 91; Rankin v. Railroad Co., 20 Fed. Cas. 274. These authorities, however, are interpretations of the bankruptcy act of 1867, of which section 37 is as follows: “flee.",
"37. And be it further enacted that the provisions of this act shall apply to all moneyed, business or commercial corporations and joint stock companies,” etc. (14 Stat. 535), and, of course, are not .determinative of the meaning of the bankruptcy act of 1898; but the meaning of said last-mentioned act must be ascertained from its own peculiar phraseology. In construing said act, however, a. few general definitions will be helpful. The word “mercantile” is defined thus: “Pertaining to merchants, or the business of merchants.” Webst. Did. “A merchant” is “one whose business it is to buy and sell merchandise,” and “merchandise” is “a term including all those things which, merchants sell, either wholesale or retail, as dry goods, hardware, groceries, drugs, etc.” Bouv. Law Dict. “Merchant” includes “hotel keeper.” Campbell v. Finck, 2 Duv. 107. It has been held that one who keeps on livery, or boards, horses belonging to other persons, is a merchant.",
"In re Odell, 18 Fed. Cas. 574. See, also, Black, Bankr. p. 82. “Trader” is thus defined: \"One who makes it his business to buy merchandise or goods and chati el:', and fo sell the same for the pm pose of making a profit. The quantum of dealing is immaterial, when the intention to deal generally exists.” 3 Starkie, 515: 2 Car. & P. 135; 1 Term it.",
"572. The principal question is whether the person has the intention of getting a living by his trading. If this is proved, the extent or duration of the trading is not material. 3 Camp. 238; 2 Bouv. Law; Dict. 741; In re Cowles, 6 Fed. Cas. 672. A baker who buys flour and makes it into bread for sale is a trader. In re Cocks, 5 Fed. Cas.",
"1154. A stair-builder is a trader. In re Garrison, 10 Fed. Cas. 49. *274These authorities, I think, fairly outline the character of a merchant or trader, within the meaning of the bankruptcy law, although there are some cases which give to the words more restricted significations, as In re Smith, 22 Fed. Cas. 394. Respondent contends that, inasmuch as the ultimate object of its business is the cure of consumptives, it is not a corporation principally engaged in trading or mercantile pursuits, resting its argument largely on the word “principally,” used in section 4 of the bankruptcy act above quoted.",
"This word “principally,” it seems to me, does not denote the object or end of a pursuit, as claimed by respondent, but is employed here to distinguish a calling, usual occupation, from an isolated single transaction. Thus, if an incorporated charity — a public free hospital, for instance — should buy a horse to be used in conveying patients to .and from the hospital, and, finding' the horse unfit for such use, should sell it, this one purchase and sale would not bring the hospital within the classification of a corporation principally engaged in trading or mercantile pursuits; but if an incorporated company such as a private hospital be conducted in a business way for profit, and not on charitable lines, it is, I think, a trading or mercantile corporation, within the meaning of the present bankruptcy law, no matter what may be the result or effects it purposes to accomplish with or upon its patrons. A decree adjudging respondent a bankrupt will be entered."
] | https://www.courtlistener.com/api/rest/v3/opinions/8865789/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Allowable Subject Matter The following is an examiner’s statement of reasons for allowance: The prior art of record, taken alone or in combination, fails discloses or render obvious a method and a laser distance measurement device for operating a hand-held laser distance measurement device for contactless distance measurement in a calibration mode comprising all the specific elements with the specific combination including acquiring at least one image of at least one target environment of the target point with a camera of the laser distance measurement device, the at least one image being a visible light image; outputting a display of the at least one image overlaid with a marker of the target point using a screen of the laser distance measurement device; and correcting a parallax error in the display of the at least one image overlaid with the marker of the target point in set forth of claims 1 and 10, wherein dependent claims 2-9 are allowable by virtue of dependency on the allowed claim 1. Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.” Any inquiry concerning this communication or earlier communications from the examiner should be directed to SANG H NGUYEN whose telephone number is (571)272-2425. The examiner can normally be reached on M-F.
If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Tarifur Chowdhury can be reached on 571-272-2800 ext. 86. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
September 10, 2021
/SANG H NGUYEN/ Primary Examiner, Art Unit 2886 | 2021-10-05T08:35:23 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Allowable Subject Matter The following is an examiner’s statement of reasons for allowance: The prior art of record, taken alone or in combination, fails discloses or render obvious a method and a laser distance measurement device for operating a hand-held laser distance measurement device for contactless distance measurement in a calibration mode comprising all the specific elements with the specific combination including acquiring at least one image of at least one target environment of the target point with a camera of the laser distance measurement device, the at least one image being a visible light image; outputting a display of the at least one image overlaid with a marker of the target point using a screen of the laser distance measurement device; and correcting a parallax error in the display of the at least one image overlaid with the marker of the target point in set forth of claims 1 and 10, wherein dependent claims 2-9 are allowable by virtue of dependency on the allowed claim 1.",
"Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.” Any inquiry concerning this communication or earlier communications from the examiner should be directed to SANG H NGUYEN whose telephone number is (571)272-2425. The examiner can normally be reached on M-F.",
"If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Tarifur Chowdhury can be reached on 571-272-2800 ext. 86. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. September 10, 2021 /SANG H NGUYEN/ Primary Examiner, Art Unit 2886"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-09-19.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
282 F.2d 120 NORTHERN PETROLEUM TANK STEAMSHIP CO., Ltd., as Owner of the Motor Vessel Tynefield, Libelant-Appellant,v.CITY OF NEW YORK, as Owner of THE Ferryboat DONGAN HILLS, Respondent-Appellee.CITY OF NEW YORK, as Owner of the Ferryboat Dongan Hills, Libelant-Appellee,v.THE M/V TYNEFIELD, her engines, etc., andThe Northern Petroleum Tank Steamship Co., Ltd., Hastings & Sons, and Furness Withy & Co., Ltd., Respondents-Appellants.Petition of CITY OF NEW YORK, as Owner of the Ferryboat Dongan Hills for a limitation or exoneration from liability. No. 332. No. 333. No. 334. Docket 26149. Docket 26150. Docket 26151. United States Court of Appeals Second Circuit. Argued June 16, 1960. Decided August 11, 1960.
William Warner, Symmers, Fish & Warner, New York City, for Northern Petroleum Tank S.S. Co., Ltd. Eugene J. Keefe, Charles H. Tenney, Corp. Counsel, New York City, Seymour B. Quel, New York City, of counsel, for City of New York. Before WATERMAN, MOORE and HAMLIN, Circuit Judges. LEONARD P. MOORE, Circuit Judge.
1 On February 8, 1958 at about 8:00 p. m., the tanker Tynefield owned and operated by the Northern Petroleum Tank Steamship Co., Ltd., Hastings & Sons and Furness Withy & Co. (collectively "Northern") and the Staten Island ferryboat Dongan Hills owned and operated by the City of New York (the "City") were in collision in New York Harbor. Three proceedings (consolidated for trial) resulted: (1) by Northern against the City and the Dongan Hills; (2) by the City against Northern and the Tynefield; and (3) a petition by the City for limitation of, or exoneration from, liability. From an interlocutory decree holding both vessels equally at fault, City and Northern appeal, each arguing that the collision was solely the fault of the other. The City also appeals from the denial of its limitation or exoneration petition.
2 The facts material to the applicable legal principles governing the determination of this controversy for the most part have been found by the trial court and are adequately supported by the evidence.
3 During the evening of February 8, 1956, the Dongan Hills was on its regular run from South Ferry, Manhattan, to Staten Island and the Tynefield, having left Bayonne, New Jersey, was en route across the Harbor bound for Kingston, New York, which is some 90 miles up the Hudson River. The Harbor was practically devoid of traffic. The Tynefield was making about 2½ to 5 knots heading east; the Dongan Hills about 13 knots southwest. There was a strong (25-30 miles) northwest wind. Both vessels had their navigation and running lights on at the time. Visibility was excellent.
4 The Tynefield had departed from its dock under control of the docking pilot. About four minutes before the collision the river pilot had taken over. On the bridge were the docking and river pilots, the master, the third officer and the helmsman. The Dongan Hills was observed about a mile away off the port bow. Except for the pilots and officers on the bridge there was no lookout stationed at the bow. The Tynefield as the privileged vessel maintained its course. It so indicated its intention by one long blast of its whistle. Receiving no response, a second blast was sounded. When a collision seemed imminent the danger signal consisting of a series of short blasts was sounded, the engine put full astern and the rudder hard right. Nevertheless, the Dongan Hills continuing on its course, struck the Tynefield almost at right angles on the port bow penetrating her number one tank.
5 In the pilot house of the Dongan Hills were the captain and assistant captain. The trial court found that "the Dongan Hills had no lookout whatsoever" and that "the assistant captain was obviously not keeping a sharp lookout, and since he had the wheel at the time cannot be considered as performing the duties of a lookout. The captain, comfortable upon the settee, was not a lookout either." No crew member was serving as a lookout. The captain and assistant captain first saw the Tynefield when it was some 600 to 700 feet away. It too gave a series of danger blasts but despite a full speed astern command the Dongan Hills collided with the Tynefield. As the trial court found as a fact, "the Dongan Hills assumed she had some prescriptive rights to the fairway and just kept plowing ahead on schedule."
6 In appraising the actions of each vessel prior to collision the primary inquiry must relate to their respective obligations and duties. New York Harbor is used by ships of all types. Ferryboats have no special "prescriptive rights" (Pitney v. United States, 2 Cir., 1945, 149 F.2d 907; The Red Star Towing & Transportation Co. v. Director General of R.R., 2 Cir., 1923, 292 F. 854). Inland and Pilot Rules of the Road apply and in this case, i.e., "Vessels approaching each other at right angles or obliquely," "the steam vessel which has the other on her own port side shall hold her course and speed"; the other vessel must keep out of the way "by directing her course to starboard so as to cross the stern of the other steam vessel, or, if necessary to do so, slacken her speed or stop or reverse." 33 C.F.R. 80.7; 33 U.S.C.A. §§ 204, 206. Thus the Tynefield as the privileged vessel had a right to continue on its course and to assume that the Dongan Hills would so maneuver as to comply with the Rule. In addition to its reliance on the Rule, the Tynefield by its single blast (repeated a second time) gave a similar guide to its intention of proceeding on course. In the comparatively few moments remaining and when collision seemed likely, both vessels blew the danger signal and attempted to stop as required by the same Rule.
7 Under the circumstances what more could the Tynefield have done? The entire purpose of any navigational rule is to create as much certainty as possible so that each vessel can conduct itself accordingly. The Tynefield had a right (even a duty as well) to maintain its course until collision appeared likely. The Dongan Hills was under an obligation to avoid a collision by obeying the rule and the Tynefield had a right to expect that she would do so. The Tynefield blew the correct whistle signals and when danger was apparent sounded the danger signal, endeavored to stop and veer off to starboard. But even if she had not signaled, "Being the privileged vessel, she was under no such duty. The Hoboken, 59 F.2d 993, 995 (C.C.A.2)." The Boston Socony, 2 Cir., 1933, 63 F.2d 246, 248.
8 In view of this long recognized navigational rule and the importance of strict adherence thereto, the trial court's conclusions that "Regardless of the right and privilege of the Tynefield to maintain her course and speed there was a continuing duty on her part to exercise care to avoid collision until the crossing was safely effected"; that the Tynefield "failed to change her speed and course until too late"; and "took no precaution to avoid the impending collision until it was too late, relying recklessly on its `privilege' in this crossing situation" are not in accord with the law. It was not reckless for the Tynefield to rely on its privilege. To the contrary she was obliged under the Rule to maintain her course (The Delaware, 1896, 161 U.S. 459, 16 S. Ct. 516, 40 L. Ed. 771). She cannot be charged with any failure to change her speed and course when to have done so would have violated the Rule. Nor did she have any reason to believe that the Dongan Hills would not comply with the Rule. It was the Dongan Hills' duty to change her course and speed (if necessary) to avoid collision. And had there been an adequate lookout the Tynefield should have been observed. Once observed the ferry could have and should have veered to starboard and passed astern of the tanker.
9 The City argues that "the basic cause of the collision in the case at bar was the failure of the Tynefield to be properly lighted." The trial court found that "both vessels had their navigation and running lights on at the time." The docking pilot of the Tynefield had testified that he saw "The starboard light and the port light, and then you could see the flare of it, the glow of the white light on the forward mast and the after mast." The Captain of the Tynefield had observed the "light indicator" which indicated that "the foremast light, the main mast light, the two side lights, port and starboard side lights and the stern light were all burning." From his position on the bridge he testified that he also actually saw the foremast light and the starboard side light. The City's argument that the Tynefield was improperly lighted is not supported by the testimony.
10 The trial court relied upon certain erasures in the Tynefield's log books as covering some default and justifying some adverse inference. However, the subject matter of the erasures did not relate to the violation of the rules of the road by the Dongan Hills. There was no sufficient proof that any change in speed, helmsmen or pilots was the cause of the collision. The absence of any designated lookout on the Tynefield was not a contributing cause. She had two officers and two pilots on duty on the bridge who saw the Dongan Hills from a distance of a mile.
11 The City also contends that the Tynefield changed her course and speed. The trial court found as a fact that the speed was not so reduced but any last-minute effort to avoid collision by so doing would not constitute fault.
12 There is no merit to the City's argument that the Tynefield entrance into the channel was improper. No proof was submitted that vessels coming out of the Kill Van Kull had to follow any special channel or course or that ferryboats were entitled to a path into which other ships trespassed at their peril.
13 The trial court concluded as to the City's petition for limitation of liability that it had failed to meet its burden of establishing that it had no knowledge of the operational negligence involved here. Having found that Captain McGuire, the director of ferry operations for the City, had knowledge that lookouts were not maintained on the ferries, and that absence of a lookout was a contributing cause of the collision, the court properly denied the petition.
14 Since upon the facts the Dongan Hills was solely liable as a matter of law, the decree of the district court should be modified to so provide, with costs to appellant, Northern Petroleum Tank Steamship Co., Ltd. | 08-23-2011 | [
"282 F.2d 120 NORTHERN PETROLEUM TANK STEAMSHIP CO., Ltd., as Owner of the Motor Vessel Tynefield, Libelant-Appellant,v.CITY OF NEW YORK, as Owner of THE Ferryboat DONGAN HILLS, Respondent-Appellee.CITY OF NEW YORK, as Owner of the Ferryboat Dongan Hills, Libelant-Appellee,v.THE M/V TYNEFIELD, her engines, etc., andThe Northern Petroleum Tank Steamship Co., Ltd., Hastings & Sons, and Furness Withy & Co., Ltd., Respondents-Appellants.Petition of CITY OF NEW YORK, as Owner of the Ferryboat Dongan Hills for a limitation or exoneration from liability. No. 332. No. 333. No.",
"334. Docket 26149. Docket 26150. Docket 26151. United States Court of Appeals Second Circuit. Argued June 16, 1960. Decided August 11, 1960. William Warner, Symmers, Fish & Warner, New York City, for Northern Petroleum Tank S.S. Co., Ltd. Eugene J. Keefe, Charles H. Tenney, Corp. Counsel, New York City, Seymour B. Quel, New York City, of counsel, for City of New York. Before WATERMAN, MOORE and HAMLIN, Circuit Judges. LEONARD P. MOORE, Circuit Judge. 1 On February 8, 1958 at about 8:00 p. m., the tanker Tynefield owned and operated by the Northern Petroleum Tank Steamship Co., Ltd., Hastings & Sons and Furness Withy & Co. (collectively \"Northern\") and the Staten Island ferryboat Dongan Hills owned and operated by the City of New York (the \"City\") were in collision in New York Harbor. Three proceedings (consolidated for trial) resulted: (1) by Northern against the City and the Dongan Hills; (2) by the City against Northern and the Tynefield; and (3) a petition by the City for limitation of, or exoneration from, liability. From an interlocutory decree holding both vessels equally at fault, City and Northern appeal, each arguing that the collision was solely the fault of the other. The City also appeals from the denial of its limitation or exoneration petition.",
"2 The facts material to the applicable legal principles governing the determination of this controversy for the most part have been found by the trial court and are adequately supported by the evidence. 3 During the evening of February 8, 1956, the Dongan Hills was on its regular run from South Ferry, Manhattan, to Staten Island and the Tynefield, having left Bayonne, New Jersey, was en route across the Harbor bound for Kingston, New York, which is some 90 miles up the Hudson River. The Harbor was practically devoid of traffic. The Tynefield was making about 2½ to 5 knots heading east; the Dongan Hills about 13 knots southwest. There was a strong (25-30 miles) northwest wind. Both vessels had their navigation and running lights on at the time. Visibility was excellent.",
"4 The Tynefield had departed from its dock under control of the docking pilot. About four minutes before the collision the river pilot had taken over. On the bridge were the docking and river pilots, the master, the third officer and the helmsman. The Dongan Hills was observed about a mile away off the port bow. Except for the pilots and officers on the bridge there was no lookout stationed at the bow. The Tynefield as the privileged vessel maintained its course. It so indicated its intention by one long blast of its whistle.",
"Receiving no response, a second blast was sounded. When a collision seemed imminent the danger signal consisting of a series of short blasts was sounded, the engine put full astern and the rudder hard right. Nevertheless, the Dongan Hills continuing on its course, struck the Tynefield almost at right angles on the port bow penetrating her number one tank. 5 In the pilot house of the Dongan Hills were the captain and assistant captain. The trial court found that \"the Dongan Hills had no lookout whatsoever\" and that \"the assistant captain was obviously not keeping a sharp lookout, and since he had the wheel at the time cannot be considered as performing the duties of a lookout. The captain, comfortable upon the settee, was not a lookout either.\"",
"No crew member was serving as a lookout. The captain and assistant captain first saw the Tynefield when it was some 600 to 700 feet away. It too gave a series of danger blasts but despite a full speed astern command the Dongan Hills collided with the Tynefield. As the trial court found as a fact, \"the Dongan Hills assumed she had some prescriptive rights to the fairway and just kept plowing ahead on schedule.\" 6 In appraising the actions of each vessel prior to collision the primary inquiry must relate to their respective obligations and duties.",
"New York Harbor is used by ships of all types. Ferryboats have no special \"prescriptive rights\" (Pitney v. United States, 2 Cir., 1945, 149 F.2d 907; The Red Star Towing & Transportation Co. v. Director General of R.R., 2 Cir., 1923, 292 F. 854). Inland and Pilot Rules of the Road apply and in this case, i.e., \"Vessels approaching each other at right angles or obliquely,\" \"the steam vessel which has the other on her own port side shall hold her course and speed\"; the other vessel must keep out of the way \"by directing her course to starboard so as to cross the stern of the other steam vessel, or, if necessary to do so, slacken her speed or stop or reverse.\"",
"33 C.F.R. 80.7; 33 U.S.C.A. §§ 204, 206. Thus the Tynefield as the privileged vessel had a right to continue on its course and to assume that the Dongan Hills would so maneuver as to comply with the Rule. In addition to its reliance on the Rule, the Tynefield by its single blast (repeated a second time) gave a similar guide to its intention of proceeding on course. In the comparatively few moments remaining and when collision seemed likely, both vessels blew the danger signal and attempted to stop as required by the same Rule. 7 Under the circumstances what more could the Tynefield have done? The entire purpose of any navigational rule is to create as much certainty as possible so that each vessel can conduct itself accordingly. The Tynefield had a right (even a duty as well) to maintain its course until collision appeared likely. The Dongan Hills was under an obligation to avoid a collision by obeying the rule and the Tynefield had a right to expect that she would do so.",
"The Tynefield blew the correct whistle signals and when danger was apparent sounded the danger signal, endeavored to stop and veer off to starboard. But even if she had not signaled, \"Being the privileged vessel, she was under no such duty. The Hoboken, 59 F.2d 993, 995 (C.C.A.2).\" The Boston Socony, 2 Cir., 1933, 63 F.2d 246, 248. 8 In view of this long recognized navigational rule and the importance of strict adherence thereto, the trial court's conclusions that \"Regardless of the right and privilege of the Tynefield to maintain her course and speed there was a continuing duty on her part to exercise care to avoid collision until the crossing was safely effected\"; that the Tynefield \"failed to change her speed and course until too late\"; and \"took no precaution to avoid the impending collision until it was too late, relying recklessly on its `privilege' in this crossing situation\" are not in accord with the law. It was not reckless for the Tynefield to rely on its privilege. To the contrary she was obliged under the Rule to maintain her course (The Delaware, 1896, 161 U.S. 459, 16 S. Ct. 516, 40 L. Ed. 771).",
"She cannot be charged with any failure to change her speed and course when to have done so would have violated the Rule. Nor did she have any reason to believe that the Dongan Hills would not comply with the Rule. It was the Dongan Hills' duty to change her course and speed (if necessary) to avoid collision. And had there been an adequate lookout the Tynefield should have been observed. Once observed the ferry could have and should have veered to starboard and passed astern of the tanker. 9 The City argues that \"the basic cause of the collision in the case at bar was the failure of the Tynefield to be properly lighted.\"",
"The trial court found that \"both vessels had their navigation and running lights on at the time.\" The docking pilot of the Tynefield had testified that he saw \"The starboard light and the port light, and then you could see the flare of it, the glow of the white light on the forward mast and the after mast.\" The Captain of the Tynefield had observed the \"light indicator\" which indicated that \"the foremast light, the main mast light, the two side lights, port and starboard side lights and the stern light were all burning.\" From his position on the bridge he testified that he also actually saw the foremast light and the starboard side light. The City's argument that the Tynefield was improperly lighted is not supported by the testimony.",
"10 The trial court relied upon certain erasures in the Tynefield's log books as covering some default and justifying some adverse inference. However, the subject matter of the erasures did not relate to the violation of the rules of the road by the Dongan Hills. There was no sufficient proof that any change in speed, helmsmen or pilots was the cause of the collision. The absence of any designated lookout on the Tynefield was not a contributing cause. She had two officers and two pilots on duty on the bridge who saw the Dongan Hills from a distance of a mile. 11 The City also contends that the Tynefield changed her course and speed. The trial court found as a fact that the speed was not so reduced but any last-minute effort to avoid collision by so doing would not constitute fault.",
"12 There is no merit to the City's argument that the Tynefield entrance into the channel was improper. No proof was submitted that vessels coming out of the Kill Van Kull had to follow any special channel or course or that ferryboats were entitled to a path into which other ships trespassed at their peril. 13 The trial court concluded as to the City's petition for limitation of liability that it had failed to meet its burden of establishing that it had no knowledge of the operational negligence involved here. Having found that Captain McGuire, the director of ferry operations for the City, had knowledge that lookouts were not maintained on the ferries, and that absence of a lookout was a contributing cause of the collision, the court properly denied the petition. 14 Since upon the facts the Dongan Hills was solely liable as a matter of law, the decree of the district court should be modified to so provide, with costs to appellant, Northern Petroleum Tank Steamship Co., Ltd."
] | https://www.courtlistener.com/api/rest/v3/opinions/251826/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
EXHIBIT 32.1 CERTIFICATION PURSUANT TO 18 U.S.C. ss.1350, AS ADOPTED PURSUANT TO SECTION -OXLEY ACT OF 2002 I, Douglas Bathauer, the chief executive officer of Integral Technologies, Inc. (the “Company”), a, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Quarterly Report of the Company on Form 10-Q, for the fiscal period ended September 30, 2016(the “Report”), fully complies with the requirements of Section13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. /s/ Douglas Bathauer Douglas Bathauer Chief Executive Officer February 10, 2017 | [
"EXHIBIT 32.1 CERTIFICATION PURSUANT TO 18 U.S.C. ss.1350, AS ADOPTED PURSUANT TO SECTION -OXLEY ACT OF 2002 I, Douglas Bathauer, the chief executive officer of Integral Technologies, Inc. (the “Company”), a, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Quarterly Report of the Company on Form 10-Q, for the fiscal period ended September 30, 2016(the “Report”), fully complies with the requirements of Section13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. /s/ Douglas Bathauer Douglas Bathauer Chief Executive Officer February 10, 2017"
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
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Exhibit 32 Section 1350 Certifications STATEMENT FURNISHED PURSUANT TO SECTION -OXLEY ACT OF 2002 The undersigned is the Chief Executive Officer and Treasurer, Principal Accounting Officer of SunVault Energy, Inc. This Certification is made pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. This Certification accompanies the Quarterly Report on Form 10-Q of SunVault Energy, Inc. for the three months ended June 30, 2013. The undersigned certifies that such 10-Q Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such 10-Q Report fairly presents, in all material respects, the financial condition and results of operations of SunVault Energy, Inc. as of June 30, 2013. This Certification is executed as of August 14, 2013 By: /s/ John Crawford Name: John Crawford Titles: President, Principal Executive Officer and Treasurer, Principal Accounting Officer and Chief Accounting Officer A signed original of this written statement required by Section 906 has been provided to SunVault Energy, Inc. and will be retained by SunVault Energy, Inc. and furnished to the Securities and Exchange Commission or its staff upon request. The forgoing certification is being furnished to the Securities and Exchange Commission pursuant to § 18 U.S.C. Section 1350. It is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing. | [
"Exhibit 32 Section 1350 Certifications STATEMENT FURNISHED PURSUANT TO SECTION -OXLEY ACT OF 2002 The undersigned is the Chief Executive Officer and Treasurer, Principal Accounting Officer of SunVault Energy, Inc. This Certification is made pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. This Certification accompanies the Quarterly Report on Form 10-Q of SunVault Energy, Inc. for the three months ended June 30, 2013. The undersigned certifies that such 10-Q Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such 10-Q Report fairly presents, in all material respects, the financial condition and results of operations of SunVault Energy, Inc. as of June 30, 2013. This Certification is executed as of August 14, 2013 By: /s/ John Crawford Name: John Crawford Titles: President, Principal Executive Officer and Treasurer, Principal Accounting Officer and Chief Accounting Officer A signed original of this written statement required by Section 906 has been provided to SunVault Energy, Inc. and will be retained by SunVault Energy, Inc. and furnished to the Securities and Exchange Commission or its staff upon request. The forgoing certification is being furnished to the Securities and Exchange Commission pursuant to § 18 U.S.C. Section 1350. It is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing."
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
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EXHIBIT 10.25
As disclosed in the annual report on form 10-K filed by Midwest Generation, this is not an agreement to which Midwest Generation is a party. However, because it contains a number of provisions to which Midwest Generation is bound, it is incorporated by reference. This caption does not constitute a part of the Guarantee.
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GUARANTEE
Dated as of December 11, 2003
in favor of
CITICORP NORTH AMERICA, INC., as Administrative Agent
made by
MIDWEST GENERATION EME, LLC as Guarantor
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GUARANTEE dated as of December 11, 2003, between MIDWEST GENERATION EME, LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (the "Guarantor"); and CITICORP NORTH AMERICA, INC, as administrative agent for the lenders or other financial institutions or entities party, as lenders, to the Credit Agreement referred to below (in such capacity, together with its successors in such capacity, the "Administrative Agent").
Mission Energy Holdings International, Inc., a corporation organized under the laws of the State of Delaware (the "Borrower"), certain lenders and the Administrative Agent are parties to a Credit Agreement dated as of December 11, 2003 (as modified and supplemented and in effect from time to time, the "Credit Agreement"), providing, subject to the terms and conditions thereof, for loans to be made by said lenders to the Borrower in an aggregate principal amount not exceeding $800,000,000.
To induce said lenders to enter into the Credit Agreement and to extend credit thereunder, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Guarantor has agreed (to the extent hereinafter provided), along with the other BV Holdings Guarantors, to jointly and severally guarantee the Guaranteed Obligations (as hereinafter defined). Accordingly, the parties hereto agree as follows:
Section 1. Definitions. Capitalized terms not otherwise defined herein shall have the meanings set forth in Annex A hereto.
Section 2. The Guarantee.
2.01 The Guarantee. Subject to the limitations set forth in Sections 2.08 and 2.09, the Guarantor hereby, along with the other BV Holdings Guarantors, jointly and severally guarantee to each Lender and the Administrative Agent and their respective successors and assigns the prompt payment in full when due (whether at stated maturity, by acceleration or otherwise) of the principal of and interest on the Loans made by the Lenders to the Borrower and all other amounts from time to time owing to the Lenders or the Administrative Agent by the Borrower under the Credit Agreement, in each case strictly in accordance with the terms thereof (such obligations being herein collectively called the "Guaranteed Obligations"). The Guarantor hereby further agrees that if the Borrower shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantor, along with the other BV Holdings Guarantors, jointly and severally will promptly pay the same, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal.
2.02 Obligations Unconditional. Subject to the limitations set forth in Sections 2.08 and 2.09, the obligations of the Guarantor under Section 2.01 (along with the obligations of the other BV Holdings Guarantors under the other BV Holdings Guarantees) are absolute and unconditional, joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the Credit Agreement or any other agreement or instrument referred to herein, or any substitution, release or exchange of any other guarantee of or security for any of the Guaranteed Obligations, and, to the fullest extent permitted by applicable law, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor, it being the intent of this Section 2.02 that the obligations of the Guarantor hereunder (and the obligations of the other BV Holdings Guarantors under the other BV Holdings Guarantees) shall be absolute and unconditional, joint and several, under any and all circumstances. Without limiting the generality of the foregoing, it is agreed that the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantor hereunder which shall remain absolute and unconditional as described above:
(i) at any time or from time to time, without notice to the Guarantor, the time for any performance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived;
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(ii) any of the acts mentioned in any of the provisions of the Credit Agreement or any other agreement or instrument referred to herein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the Guaranteed Obligations shall be modified, supplemented or amended in any respect, or any right under the Credit Agreement or any other agreement or instrument referred to herein shall be waived or any other guarantee of any of the Guaranteed Obligations or any security therefor shall be released or exchanged in whole or in part or otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of, the Administrative Agent or any Lender or Lenders as security for any of the Guaranteed Obligations shall fail to be perfected.
The Guarantor hereby expressly waives, to the extent permitted by applicable law, diligence, presentment, demand of payment, protest and all notices whatsoever, and any requirement that the Administrative Agent or any Lender exhaust any right, power or remedy or proceed against the Borrower under the Credit Agreement or any other agreement or instrument referred to herein, or against any other Person under any other guarantee (including other BV Holdings Guarantees) of, or security for, any of the Guaranteed Obligations.
2.03 Reinstatement. The obligations of the Guarantor under this Section 2 shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of the Borrower in respect of the Guaranteed Obligations is rescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, and the Guarantor, along with the other BV Holdings Guarantors, jointly and severally agree that they will indemnify the Administrative Agent and each Lender on demand for all reasonable costs and expenses (including, without limitation, fees of counsel) incurred by the Administrative Agent or such Lender in connection with such rescission or restoration, including any such costs and expenses incurred in defending against any claim alleging that such payment constituted a preference, fraudulent transfer or similar payment under any bankruptcy, insolvency or similar law.
2.04 Subrogation. The Guarantor hereby waives all rights of subrogation or contribution, whether arising by contract or operation of law (including, without limitation, any such right arising under the Federal Bankruptcy Code) or otherwise by reason of any payment by it pursuant to the provisions of this Section 2 and further agrees with the Borrower for the benefit of each of its creditors (including, without limitation, each Lender and the Administrative Agent) that any such payment by it shall constitute a contribution of capital by the Guarantor to the Borrower (or an investment in the equity capital of the Borrower by the Guarantor).
2.05 Remedies. The Guarantor, along with the other BV Holdings Guarantors, jointly and severally agree that, as between the Guarantor, the other BV Holdings Guarantors and the Lenders, the obligations of the Borrower under the Credit Agreement may be declared to be forthwith due and payable as provided in Section 8.3 of the Credit Agreement (and shall be deemed to have become automatically due and payable in the circumstances provided in said Section 8.2 of the Credit Agreement) for purposes of Section 2.01 notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against the Borrower and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by the Borrower) shall forthwith become due and payable by the Guarantor for purposes of Section 2.01.
2.06 Instrument for the Payment of Money; Post-Default Interest. The Guarantor hereby acknowledges that the guarantee in this Section 2 constitutes an instrument for the payment of money, and consents and agrees that any Lender or the Administrative Agent, at its sole option, in the event of a dispute by the Guarantor in the payment of any moneys due hereunder, shall have the right to bring motion action under New York CPLR Section 3213. In addition, the Guarantor hereby agrees that (without regard to the limitation contained in Section 2.09) in the event it shall fail to pay in full any amount owing by it hereunder on the date upon which the same shall become due (whether upon demand or otherwise), it shall be obligated to pay interest at the Post-Default Rate in respect of such
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amount for each day during the period from and including the due date thereof to but excluding the date the same shall be paid in full, such interest to be payable upon demand of the Administrative Agent.
2.07 Continuing Guarantee. The guarantee in this Section 2 is a continuing guarantee, and shall apply to all Guaranteed Obligations whenever arising.
2.08 General Limitation on Guarantee Obligations. In any action or proceeding involving any state corporate law, or any state or Federal bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if the obligations of the Guarantor under Section 2.01 would otherwise be held or determined to be void, invalid or unenforceable, or subordinated to the claims of any other creditors, on account of the amount of its liability under Section 2.01, then, notwithstanding any other provision hereof to the contrary, the amount of such liability shall, without any further action by the Guarantor, the Administrative Agent, the Lenders or any other Person, be automatically limited and reduced to the highest amount that is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding.
2.09 Dollar Limitation on Guarantee Obligations. Notwithstanding the foregoing provisions of this Section 2, the aggregate amount that the Guarantor may be required to pay under Section 2.01, plus the amounts required to be paid by the other BV Holdings Guarantors under the other BV Holdings Guarantees, shall not exceed an amount equal to the principal amount of the Loans on the Closing Date (and if less the aggregate principal amount of the Loans outstanding at any time), plus accrued and unpaid interest (whether due after acceleration or otherwise, applicable fees, expenses and all other amounts payable with respect to such Loans under the Loan Documents.
2.10. Rights of Contribution. The Guarantor hereby agrees, and each other BV Holdings Guarantor has agreed in its respective BV Holdings Guarantee that, as between themselves, that if any of the BV Holdings Guarantors shall become an Excess Funding Guarantor (as defined below) by reason of the payment by such BV Holdings Guarantor of any Guaranteed Obligations, each other BV Holdings Guarantor shall, on demand of such Excess Funding Guarantor (but subject to the next sentence), pay to such Excess Funding Guarantor an amount equal to such BV Holdings Guarantor's Pro Rata Share (as defined below and determined, for this purpose, without reference to the properties, debts and liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined below) in respect of such Guaranteed Obligations. The payment obligation of a BV Holdings Guarantor to any Excess Funding Guarantor under this Section 2.10 shall be subordinate and subject in right of payment to the prior payment in full of the obligations of such BV Holdings Guarantor under the other provisions of this Article and such Excess Funding Guarantor shall not exercise any right or remedy with respect to such excess until payment and satisfaction in full of all of such obligations.
For purposes of this Section 2.10, (i) "Excess Funding Guarantor" means, in respect of any Guaranteed Obligations, a BV Holdings Guarantor that has paid an amount in excess of its Pro Rata Share of such Guaranteed Obligations, (ii) "Excess Payment" means, in respect of any Guaranteed Obligations, the amount paid by an Excess Funding Guarantor in excess of its Pro Rata Share of such Guaranteed Obligations and (iii) "Pro Rata Share" means, for any BV Holdings Guarantor, the ratio (expressed as a percentage) of (x) the amount by which the aggregate present fair saleable value of all properties of such BV Holdings Guarantor (excluding any shares of stock of any other BV Holdings Guarantor) exceeds the amount of all the debts and liabilities of such BV Holdings Guarantor (including contingent, subordinated, unmatured and unliquidated liabilities, but excluding the obligations of such BV Holdings Guarantor hereunder and any obligations of any other BV Holdings Guarantor that have been Guaranteed by such BV Holdings Guarantor) to (y) the amount by which the aggregate fair saleable value of all properties of all of the BV Holdings Guarantors exceeds the amount of all the debts and liabilities (including contingent, subordinated, unmatured and unliquidated liabilities, but excluding the obligations of the Borrower and the BV Holdings Guarantors hereunder and under the other Loan Documents) of all of the BV Holdings Guarantors.
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Section 3. Representations and Warranties. The Guarantor represents and warrants as of the Effective Date with respect to itself and with respect to its Subsidiaries, to the Lenders and the Administrative Agent that:
3.01 Organization; Power; Compliance with Law and Contractual Obligations. Each of the Guarantor and its Subsidiaries (a) is a corporation or a limited liability company validly organized and existing and in good standing under the laws of the state of its incorporation or organization, (b) is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction where the nature of its business requires such qualification, (c) has all requisite corporate or limited liability company power and authority and holds all material requisite governmental licenses, permits and other approvals to conduct its business substantially as currently conducted by it and, in the case of the Guarantor, perform its obligations hereunder and (d) is in compliance with all laws, governmental regulations (including ERISA and Federal Reserve regulations), court decrees, orders and Contractual Obligations applicable to it, except, with respect to clauses (b), (c) and (d) to the extent that the failure to comply therewith would not reasonably be expected to have a Material Adverse Effect.
3.02 Due Authorization; Non-Contravention. The execution, delivery and performance by the Guarantor of this Agreement is within the Guarantor's limited liability company powers, has been duly authorized by all necessary limited liability company action, and does not:
(a) contravene the Guarantor's Organic Documents;
(b) contravene any law, governmental regulation, court decree or order or material Contractual Obligation binding on or affecting the Guarantor or its Subsidiaries; or
(c) result in, or require the creation or imposition of, any Lien on any of the Guarantor's or its Subsidiaries' properties.
3.03 Governmental Approval; Regulation.
(a) No authorization, consent, approval, license, exemption of or filing or registration with any court or governmental authority or regulatory body ("Governmental Approval") is required for the Guarantor to execute and perform its obligations hereunder, except for those which have been duly obtained or effected. No material Governmental Approval is required for the Guarantor or its Subsidiaries to carry on its business, except for those which have been duly obtained or effected.
(b) Neither the Guarantor nor its Subsidiaries is (i) subject to any regulation as an "investment company" under the Investment Company Act of 1940, as amended, or (ii) a "holding company" or a "subsidiary" or an "affiliate" of a "holding company" that is subject to the Public Utility Holding Company Act of 1935, as amended, except Section 9(a)(2), 32 or 33 thereof. The Guarantor or its Subsidiaries are not otherwise subject to any regulation as a "public utility" under any other applicable law, rule or regulation, which would have a Material Adverse Effect.
3.04 Validity. This Agreement constitutes the legal, valid and binding obligations of the Guarantor enforceable in accordance with their respective terms (except as may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights generally and general principles of equity).
3.05 Financial Information. The unaudited consolidated balance sheet of the Guarantor and its Subsidiaries as at December 31, 2002, and the related consolidated statement of income of the Guarantor and its Subsidiaries, copies of which have been furnished to the Administrative Agent, have been prepared using GAAP and present fairly in all material respects the consolidated financial condition of the Guarantor and its Subsidiaries as at the dates thereof and the results of their operations for the period then ended.
3.06 No Material Adverse Change. There has not occurred any event or condition having a Material Adverse Effect since December 31, 2002, except as otherwise disclosed in the Relevant Public Filings.
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3.07 Litigation. Except as disclosed in the Relevant Public Filings, there is no pending or, to the knowledge of the Guarantor or its Subsidiaries, threatened litigation, action, proceeding, or labor controversy affecting the Guarantor or its Subsidiaries, or any of its properties, businesses, assets or revenues, which, if adversely determined (taking into account any insurance proceeds payable under a policy where the insurer has accepted coverage without any reservations), would have a Material Adverse Effect or which purports to adversely affect the legality, validity or enforceability of this Agreement.
3.08 Ownership of Properties.
(a) Except as set forth (i) on Schedule 3.08(a) hereto and (ii) in the Correlative Financing Provisions, each of the Guarantor and its Subsidiaries owns good and marketable title to, or a valid leasehold interest in or other enforceable interest in all properties and assets, real and personal, tangible and intangible, of any nature whatsoever (including patents, trademarks, trade names, service marks and copyrights) purported to be owned, leased or held by it, free and clear of all Liens, charges or claims (including infringement claims with respect to patents, trademarks, copyrights and the like) except as permitted pursuant to Section 5.02.
(b) The properties and assets of each of the Guarantor and its Subsidiaries are separately identifiable and are not commingled with the properties and assets of any other entity, except that for certain internal organizational, but not legal, purposes, the Illinois plants operated by the Subsidiaries of the Guarantor as well as the Homer City plant operated by an Affiliate of the Guarantor are sometimes referred to collectively as Midwest Generation. The properties and assets of each of the Guarantor and its Subsidiaries are readily distinguishable from the properties and assets of EME.
3.09 Taxes. Each of the Guarantor and its Subsidiaries has filed all tax returns and reports required by law to have been filed by it and has paid all taxes and governmental charges thereby shown to be owing, except any such taxes or charges which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books.
3.10 Pension and Welfare Plans. During the consecutive twelve-month period prior to the date of the execution and delivery of this Agreement, no steps have been taken to terminate any Pension Plan, and no contribution failure has occurred with respect to any Pension Plan sufficient to give rise to a Lien under Section 302(f) of ERISA. No condition exists or event or transaction has occurred with respect to any Pension Plan which would reasonably be expected to result in the incurrence by the Guarantor or any member of the Controlled Group of any material liability (other than liabilities incurred in the ordinary course of maintaining the Pension Plan), fine or penalty. Neither the Guarantor nor any member of the Controlled Group has any contingent liability with respect to any post-retirement benefit under a Welfare Plan which would reasonably be expected to have a Material Adverse Effect, other than liability for continuation coverage described in Part 6 of Title I of ERISA.
3.11 Environmental Warranties.
(a) All facilities and property owned or leased by the Guarantor or any of its Subsidiaries or, to its knowledge, Joint Enterprises have been, and continue to be, owned or leased by the Guarantor and its Subsidiaries in compliance with all Environmental Laws, except where the failure so to comply would not have, or be reasonably expected to have, a Material Adverse Effect.
(b) Except as disclosed in the Relevant Public Filings, there are no pending or, to the knowledge of the Guarantor, threatened:
(i) claims, complaints, notices or requests for information received by the Guarantor or its Subsidiaries from governmental authorities with respect to any alleged violation by the Guarantor or its Subsidiaries of any Environmental Law that, singly or in the aggregate, have, or would reasonably be expected to have, a Material Adverse Effect; or
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(ii) complaints, notices or inquiries to the Guarantor or its Subsidiaries from governmental authorities regarding potential liability under any Environmental Law that, singly or in the aggregate, have, or would reasonably be expected to have, a Material Adverse Effect.
(c) (i) To the knowledge of the Guarantor and except as have been disclosed in the Relevant Public Filings, there have been no Releases (as defined under any Environmental Law) of Hazardous Materials prior to December 15, 1999 at, on or under any property now or previously owned or leased by the Guarantor or its Subsidiaries and (ii) except as have been disclosed in the Relevant Public Filings after December 15, 1999, there have been no Releases (as defined under any Environmental Law) of Hazardous Materials at, on or under any property now or previously owned or leased by the Guarantor or its Subsidiaries that, singly or in the aggregate, have, or would reasonably be expected to have, a Material Adverse Effect.
(d) Each of the Guarantor and its Subsidiaries has obtained and is in compliance with all permits, certificates, approvals, licenses and other authorizations relating to environmental matters and necessary for the Guarantor's or its Subsidiaries' business, except where the failure to obtain, maintain or comply with such permits, certificates, approvals, licenses or other authorizations would not have, or be reasonably expected to have, a Material Adverse Effect.
(e) To the reasonable knowledge of the Guarantor, no property now or previously owned or leased by the Guarantor or its Subsidiaries is listed or proposed for listing (with respect to owned property only) on the National Priorities List pursuant to any Environmental Law, on the CERCLIS or on any similar state list of sites requiring investigation or clean-up.
(f) No conditions exist at, on or under any property now or previously owned or leased by the Guarantor or its Subsidiaries which, with the passage of time, or the giving of notice or both, would give rise to liability under any Environmental Law which liability would have, or would reasonably be expected to have, a Material Adverse Effect.
3.12 Regulations T, U and X. Neither the Guarantor nor its Subsidiaries is engaged in the business of extending credit for the purpose of purchasing or carrying margin stock, and no proceeds of any Loans will be used for a purpose which violates, or would be inconsistent with, F.R.S. Board Regulation T, U or X. Terms for which meanings are provided in F.R.S. Board Regulation T, U or X or any regulations substituted therefore, as from time to time in effect, are used in this Section 3.12 with such meanings.
3.13 The Obligations. Except as set forth in Schedule 5.01, this Agreement is the only outstanding Indebtedness of the Guarantor.
3.14 Separateness.
(a) The Guarantor and its Subsidiaries maintain separate bank accounts and separate books of account from those bank accounts and books of account of EME and any other entity. The separate liabilities of the Guarantor and its Subsidiaries are readily distinguishable from the liabilities of EME.
(b) Although the Guarantor and its Subsidiaries generally do business under the collective name of "Midwest Generation," each of the Guarantor and its Subsidiaries enters into contractual relations solely in its own name in a manner not misleading to other Persons as to its identity. Without limiting the generality of the foregoing, all invoices, purchase orders, contracts, statements, and applications are made solely in the name of the Guarantor or its Subsidiaries, if related to the Guarantor or its Subsidiaries.
(c) The Guarantor is a 100% wholly owned direct Subsidiary of EME.
Section 4. Affirmative Covenants. The Guarantor agrees, with respect to itself and with respect to Subsidiaries and Joint Enterprises, if any, it may have now or in the future that, until the payment and satisfaction in full of the Guaranteed Obligations:
4.01 Financial Information, Reports, Notices. The Guarantor will furnish, or will cause its Subsidiaries to furnish, to the Administrative Agent (a) copies of the financial statements, reports,
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notices and information required to be furnished pursuant to Section 7.11 of the Credit Agreement, (b) copies of the documents governing Permitted Refinancing Indebtedness of each Financed Subsidiary referred to in the definition of "Correlative Financing Provisions" and all amendments, supplements and modifications thereto and (c) other information reasonably requested by the Administrative Agent.
4.02 Compliance with Laws. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, comply in all material respects with all applicable laws, rules, regulations and orders, such compliance to include the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property (except to the extent non-compliance would not reasonably be expected to have a Material Adverse Effect and to the extent that such assignments and charges are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books); provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
4.03 Maintenance of Properties. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, maintain, preserve, protect and keep its property and equipment in good repair, working order and condition (ordinary wear and tear excepted), and make necessary and proper repairs, renewals and replacements so that its business carried on in connection therewith may be properly conducted at all times unless the Guarantor determines in good faith that the continued maintenance of any of its properties or equipment is no longer economically desirable and except where the failure so to do would not have a Material Adverse Effect; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
4.04 Insurance. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, maintain or cause to be maintained with responsible insurance companies insurance with respect to its properties and business against such casualties and contingencies and of such types and in such amounts as is customary in the case of similar businesses and in a similar geographic region; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
4.05 Books and Records. The Guarantor will:
(a) keep books and records separate from the books and records of its Affiliates or any other entity which accurately reflect all of its business affairs, transactions and the documents and other instruments that underlie all limited liability company actions;
(b) cause each of its Subsidiaries to keep books and records which accurately reflect their affairs and transactions;
(c) keep separate books and records from EME and separately identify its own property, assets, liabilities and financial affairs from EME; and
(d) permit the Administrative Agent and Lenders (at such Lender's expense) or any of their respective representatives, at reasonable times and intervals upon reasonable prior notice, to visit all of its offices, to discuss its financial matters with its officers and independent public accountant.
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The Guarantor will at any reasonable time and from time to time upon reasonable prior notice, permit the Administrative Agent or any of their respective agents or representatives to examine and make copies of and abstracts from the records and books of account of the Guarantor; provided that by virtue of this Section 4.05 the Guarantor shall not be deemed to have waived any right to confidential treatment of the informational obtained, subject to the provisions of applicable law or court order.
4.06 Environmental Covenant. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to:
(a) use and operate all of its facilities and properties in compliance with all Environmental Laws, keep all necessary permits, approvals, certificates, licenses and other authorizations relating to environmental matters in effect and remain in material compliance therewith, and handle all Hazardous Materials in material compliance with all applicable Environmental Laws, in each case where the failure to do so may reasonably be expected to have a Material Adverse Effect; and
(b) provide such non-privileged information as the Administrative Agent may reasonably request from time to time to evidence compliance with this Section 4.06;
provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
4.07 Conduct of Business and Maintenance of Existence. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, continue to engage in business of the same type as now conducted by it and preserve, renew and keep in full force and effect its existence (corporate or otherwise) and good standing in the state of its organization and take all reasonable action to maintain all material rights, privileges and franchises necessary or desirable in the normal conduct of its business, except, in each case, as otherwise permitted by Sections 5.04 and 5.05; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
4.08 Separateness. The Guarantor will:
(a) act solely in its name and through its duly authorized officers or agents in the conduct of its businesses;
(b) except as described in Section 3.14(b), conduct its business solely in its own name, in a manner not misleading to other Persons as to its identity, (without limiting the generality of the foregoing, all invoices, purchase orders, contracts, statements, and applications are made and shall continue to be made solely in the name of the Guarantor, if related to the Guarantor); and
(c) obtain proper authorization from its managing directors or members, as required by its Organic Documents for all limited liability company actions of the Guarantor.
Section 5. Negative Covenants. The Guarantor agrees, with respect to itself and with respect to Subsidiaries and Joint Enterprises, if any, it may have now or in the future that, until the payment and satisfaction in full of the Guaranteed Obligations:
5.01 Restrictions on Indebtedness. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its
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obligations to other members of such Joint Enterprise) to, create, incur, assume or suffer to exist any Indebtedness other than:
(a) Indebtedness of the Guarantor set forth on Schedule 5.01 existing on the Effective Date and Indebtedness of the Guarantor's Subsidiaries or Joint Enterprises of any kind whatsoever existing on the Effective Date;
(b) Permitted Refinancing Indebtedness;
(c) Permitted Intercompany Indebtedness or Permitted EME Intercompany Indebtedness;
(d) Indebtedness consisting of a $100,000,000 cash collateralized letter of credit facility; and
(e) Indebtedness secured by Liens set forth on Schedule 3.08(a).
provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
5.02 Liens. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, create, incur, assume or suffer to exist any Lien upon any of its property, revenues or assets, whether now owned or hereafter acquired, except:
(a) any Lien existing on the property of the Guarantor, the Guarantor's Subsidiaries or Joint Enterprises on the Effective Date.
(b) Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books;
(c) Liens (other than Liens securing Indebtedness for borrowed money or Contingent Liabilities relating to borrowed money) incurred in the ordinary course of business for sums not overdue or which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books, collectively hereunder, in no event to exceed $5,000,000 in the aggregate at any time outstanding;
(d) Liens incurred in the ordinary course of business in connection with workmen's compensation, unemployment insurance or other forms of governmental insurance or benefits, or to secure performance of tenders, statutory obligations, leases and contracts (other than for borrowed money or Contingent Liabilities relating to borrowed money) entered into in the ordinary course of business or to secure obligations on surety or appeal bonds;
(e) judgment Liens in existence less than 30 days after the entry thereof or with respect to which execution has been stayed or the payment of which is covered in full (subject to a customary deductible) by insurance maintained with responsible insurance companies;
(f) Liens incurred by any Financed Subsidiary in connection with the Permitted Refinancing Indebtedness; and
(g) Liens securing Indebtedness issued pursuant to Section 5.01(d).
provided that (i) in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor) and (ii) notwithstanding anything to the contrary in this Section 5.02, no intercompany note or other intercompany obligation payable to the Guarantor will be pledged, encumbered or otherwise transferred (except as pledged or encumbered under, and pursuant to, the Security Documents).
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5.03 Investments. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, make, incur, assume or suffer to exist any Investment in any other Person, except:
(a) Investments existing on the Effective Date;
(b) Cash Equivalent Investments;
(c) without duplication, Investments permitted as Indebtedness pursuant to Section 5.01;
(d) Investments in Subsidiaries or Joint Enterprises of the Guarantor in the ordinary course of business;
(e) Investments permitted pursuant to Section 5.04(b);
(f) Investments in Subsidiaries or Joint Enterprises of the Guarantor primarily engaged in the power generation, power sales or power transmission business;
(g) Investments to permit the Guarantor or a Subsidiary of the guarantor to directly or indirectly acquire the Indebtedness of the lessors of the Collins facility or the related Indebtedness evidenced by promissory notes issued by Midwest Funding LLC; and
(h) Investments in Affiliates resulting from the issuances of letters of credit under the letter of credit facility pursuant to Section 5.01(d).
provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
5.04 Consolidation, Merger. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, liquidate or dissolve, consolidate with, or merge into or with, any other Person, or purchase or otherwise acquire all or substantially all of the assets of any Person except as permitted pursuant to Section 5.03(g) (or of any division thereof) and except:
(a) any such Subsidiary of the Guarantor may liquidate or dissolve voluntarily into, and may merge with and into, any other Subsidiary of the Guarantor, and the assets or stock of any Subsidiary of the Guarantor may be purchased or otherwise acquired by any other Subsidiary of the Guarantor;
(b) the Guarantor or any of its Subsidiaries may purchase all or substantially all of the assets of any Person, or acquire such person by merger; provided, that after giving effect thereto, the surviving corporation has Debt Ratings of at least BBB- from S&P and Baa3 from Moody's (with a stable outlook from both rating agencies); and
(c) so long as no Default or Event of Default has occurred and is continuing or would occur after giving effect thereto, the Guarantor may consolidate with or merge into any other Person, or convey, transfer or lease its properties and assets substantially as an entirety to any person, or permit any Person to merge into or consolidate with the Guarantor if (i) the Guarantor is the surviving corporation or the surviving corporation or purchaser or lessee is a corporation incorporated under the laws of the United States of America and assumes the Guarantor's obligations under this Agreement and (ii) the surviving corporation has Debt Ratings of at least BBB- from S&P and Baa3 from Moody's (with a stable outlook from both rating agencies).
5.05 Asset Dispositions. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, Dispose of, lease, contribute or otherwise convey, or grant
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options, warrants or other rights with respect to, all or any substantial part of its assets (including accounts receivable and capital stock of Subsidiaries) to any Person, unless:
(a) such Disposition, lease, contribution, conveyance or grant is to an unaffiliated third party on an arm's-length basis;
(b) at least 90% of the consideration to be received is paid in cash or Cash Equivalent Investments and such remaining 10% is not a debt instrument of the Guarantor or any of its Affiliates (provided that for purposes of this provision, (i) any amounts deposited into an escrow or other type of holdback account and any consideration in the form of readily marketable securities shall be deemed to be cash, (ii) customary purchase price adjustments may be settled on a non-cash basis and (iii) the assumption of Indebtedness relating to the asset being Disposed shall be disregarded for the purposes of this provision); and
(c) a mandatory prepayment of the Loan is made in an amount equal to the amount required to be made pursuant to Section 3.1.2 of the Credit Agreement as a result of the Net After-Tax Cash Proceeds of such sale;
provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with clauses (a) and (b) this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).
5.06 Restricted Payments. The Guarantor will not make a Restricted Payment so long as a Default or Event of Default has occurred and is continuing nor will the Guarantor permit any of its Subsidiaries to make a Restricted Payment (other than Restricted Payments to the Guarantor or other Subsidiaries of the Guarantor (contemporaneously with ratable Restricted Payments to holders of minority interests, if applicable)).
5.07 Transactions with Affiliates. The Guarantor will not enter into, or cause, suffer or permit to exist any arrangement or contract with any of its Affiliates unless such arrangement or contract (i) is fair and equitable to the Guarantor, (ii) is upon fair and reasonable terms no less favorable to the Guarantor than it would obtain in a comparable arm's length transaction with a Person which is not an Affiliate and (iii) does not restrict the payment of Restricted Payments to the Guarantor or any of its Subsidiaries and its Joint Enterprises; provided, that it is understood that the foregoing is not intended to and shall not apply to (i) the intercompany Indebtedness owing from MWG to Edison Mission Overseas or from Edison Mission Overseas to EMMH as in existence on the Effective Date or as the same may be modified to take into account or "mirror" any Permitted Refinancing Indebtedness or (ii) the cash collateralized letter of credit facility contemplated by Section 5.01(d).
5.08 Separateness. The Guarantor will, and will cause its Subsidiaries to and will use reasonable efforts to cause its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, not (other than in connection with the cash collateralized letter of credit facility contemplated by Section 5.01(d)):
(a) hold itself out as having agreed to pay or become liable for any Indebtedness of EME;
(b) fail to correct any known or reasonably knowable misrepresentation with respect to clause (a) of this Section 5.08;
(c) fail to correct any known or reasonably knowable misrepresentation with respect to EME holding itself out as having agreed to pay or become liable for any Indebtedness of the Guarantor;
(d) operate or purport to operate as an integrated, single economic unit with respect to EME or any other Affiliated or unaffiliated entity;
(e) seek or obtain credit, incur any obligation or any Indebtedness to any third party based upon the assets of EME;
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(f) induce any such third party to reasonably rely on the creditworthiness of EME or any other Affiliated or unaffiliated entity in connection with any obligation or any Indebtedness of the Guarantor; and
(g) allow EME to guarantee any of the obligations of the Guarantor.
The foregoing is qualified in its entirety by the following: EME owes MWG approximately $1,365,000 in the aggregate pursuant to promissory notes dated as of August 24, 2000 and EME guarantees payment of the obligations of MWG under and has certain tax indemnity obligations with respect to the lease relating to its Powerton and Joliet units dated as of August 17, 2000. These obligations may be modified in connection with Permitted Refinancing Indebtedness and may otherwise be modified from time to time in the manner permitted under the documentation governing such obligations. In addition, EME guarantees payments due under the lease of the office premises occupied by the Guarantor.
5.09 ERISA. The Guarantor will and will cause its Subsidiaries to, not engage in any prohibited transactions under Section 406 of ERISA or under Section 4975 of the Code, which would subject the Guarantor to any tax, penalty or other liabilities having a Material Adverse Effect.
Section 6. Miscellaneous.
6.01 Notices. All notices, requests, consents and demands hereunder shall be in writing and telecopied or delivered to the intended recipient at the "Address for Notices" specified beneath its name on the signature pages hereto or, as to either party, at such other address as shall be designated by such party in a notice to each other party. Except as otherwise provided in this Agreement, all such communications shall be deemed to have been duly given when transmitted by telecopier or personally delivered or, in the case of a mailed notice, upon receipt, in each case given or addressed as aforesaid.
6.02 No Waiver. No failure on the part of the Administrative Agent or any Lender to exercise, and no course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Administrative Agent or any Lender of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies herein are cumulative and are not exclusive of any remedies provided by law.
6.03 Amendments, Etc. The terms of this Agreement may be waived, altered or amended only by an instrument in writing duly executed by the Guarantor and the Administrative Agent (with the consent of the Lenders as specified in Section 10.1 of the Credit Agreement). Any such amendment or waiver shall be binding upon the Administrative Agent and each Lender, each holder of any of the Guaranteed Obligations and the Guarantor.
6.04 Expenses. The Guarantor agrees to reimburse each of the Lenders and the Administrative Agent for all reasonable costs and expenses of the Lenders and the Administrative Agent (including, without limitation, the reasonable fees and expenses of legal counsel) in connection with (a) any Default and any enforcement or collection proceeding resulting therefrom, including, without limitation, all manner of participation in or other involvement with (i) bankruptcy, insolvency, receivership, foreclosure, winding up or liquidation proceedings, (ii) judicial or regulatory proceedings and (iii) workout, restructuring or other negotiations or proceedings (whether or not the workout, restructuring or transaction contemplated thereby is consummated) and (b) the enforcement of this Section 6.04.
6.05 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of the Guarantor, the Administrative Agent, the Lenders and each holder of any of the Guaranteed Obligations (provided, however, that the Guarantor shall not assign or transfer its rights or obligations hereunder without the prior written consent of the Administrative Agent).
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6.06 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and either of the parties hereto may execute this Agreement by signing any such counterpart.
6.07 Governing Law; Submission to Jurisdiction. This Agreement shall be governed by, and construed in accordance with, the law of the State of New York. The Guarantor hereby submits to the non exclusive jurisdiction of the United States District Court for the Southern District of New York and of the Supreme Court of the State of New York sitting in New York County (including its Appellate Division) and of any other appellate court in the State of New York for the purposes of all legal proceedings arising out of or relating to this Agreement or the transactions contemplated hereby. The Guarantor hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of the venue of any such proceeding brought in such a court and any claim that any such proceeding brought in such a court has been brought in an inconvenient forum.
6.08 Waiver of Jury Trial. EACH OF THE GUARANTOR, THE ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
6.09 Captions. The captions and section headings appearing herein are included solely for convenience of reference and are not intended to affect the interpretation of any provision of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Primary Guarantee to be duly executed and delivered as of the day and year first above written.
MIDWEST GENERATION EME, LLC By: /s/ MARIA P. LITOS
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Name: Maria P. Litos Title: Vice President and Assistant Secretary Address for Notices:
[Signature Page to Midwest Generation EME LLC Primary Guarantee]
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CITICORP NORTH AMERICA, INC, as Administrative Agent By: /s/ DALE R. GONCHER
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Name: Dale R. Goncher Title: Vice President
[Signature Page to Midwest Generation EME LLC Primary Guarantee]
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ANNEX A
"Administrative Agent" means Citicorp North America, Inc., in its capacity as administrative agent for the Lenders hereunder, and includes each other Person as may have subsequently been appointed as the successor Administrative Agent pursuant to Section 9.4 of the Credit Agreement.
"Affiliate" of any Person means any other Person which, directly or indirectly, controls, is controlled by or is under common control with such Person (excluding any trustee under, or any committee with responsibility for administering, any Pension Plan or Welfare Plan). A Person shall be deemed to be "controlled by" any other Person if such other Person possesses, directly or indirectly, power to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
"Agreement" means, on any date, this Guarantee as originally in effect on the Effective Date and as thereafter from time to time amended, supplemented, amended and restated or otherwise modified and in effect on such date.
"Board of Directors" means, (a) with respect to a corporation, the board of directors of the corporation, (b) with respect to a partnership, the general partners or the management committee of the partnership or (c) with respect to any other Person, the board or committee of such Person serving a similar function.
"Borrower" means Mission Energy Holdings International, Inc., a Delaware corporation.
"BV Holdings Guarantees" mean this Agreement and the other "Guarantees", in effect from time to time, as such meaning is set forth in the Credit Agreement.
"BV Holdings Guarantors" means the Guarantor hereunder and the other "Guarantors", as such meaning is set forth in the Credit Agreement.
"Capitalized Lease Liabilities" of any Person means all monetary obligations of such Person under any leasing or similar arrangement which, in accordance with GAAP, would be classified as capitalized leases, and, for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP.
"Cash Equivalent Investment" means, at any time:
(a) any evidence of Indebtedness, maturing not more than one year after such time, issued or guaranteed by the United States government or an agency thereof; or
(b) other investments in securities or bank instruments rated at least "A" by S&P and "A2" by Moody's or "A-1" by S&P and "P-1" by Moody's and with maturities of less than 180 days.
"CERCLIS" means the Comprehensive Environmental Response Compensation Liability Information System List.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collins Holdings" means Collings Holdings EME LLC, a Delaware limited liability company.
"Contingent Liability" means any agreement, undertaking or arrangement by which any Person guarantees, endorses or otherwise becomes or is contingently liable upon (by direct or indirect agreement, contingent or otherwise, to provide funds for payment, to supply funds to, or otherwise to invest in, a debtor, or otherwise to assure a creditor against loss) the indebtedness, obligation or any other liability of any other Person (other than by endorsements of instruments in the course of collection), or guarantees the payment of dividends or other distributions upon the shares of any other Person. The amount of any Person's obligation under any Contingent Liability shall (subject to any limitation set forth therein) be deemed to be the outstanding principal amount of the debt, obligation or other liability guaranteed thereby; provided, however, that if the maximum amount of the debt, obligation or other liability guaranteed thereby has not been established, the amount of such Contingent Liability shall be the maximum reasonably anticipated amount of the debt, obligation or
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other liability; provided, further, however, that any agreement to limit the maximum amount of such Person's obligation under such Contingent Liability shall not, of and by itself, be deemed to establish the maximum reasonably anticipated amount of such debt, obligation or other liability.
"Contractual Obligation" means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.
"Contractual Restrictions" mean Contractual Obligations of the Guarantor or any of its Subsidiaries limiting or restricting any of the following activities of the Guarantor or any of its Subsidiaries: (a) Restricted Payments, (b) the repayment or prepayment of intercompany notes or other intercompany obligations or reimbursements of management and other intercompany charges, expenses or accruals or other returns on investment, (c) Disposition (as defined in the Credit Agreement), (d) Debt Incurrence (as defined in the Credit Agreement), (e) Equity Issuance (as defined in the Credit Agreement) or (f) activities related to the foregoing.
"Controlled Group" means all members of a controlled group of corporations and all members of a controlled group of trades or businesses (whether or not incorporated) under common control which, together with the Guarantor, are treated as a single employer under Section 414(b) or 414(c) of the Code or Section 4001 of ERISA.
"Correlative Financing Provisions" means (i) with respect to each Financed Enterprise with respect to any provision in Section 5, the most restrictive correlative provision or provisions in the Effective Date Financing Documentation or in the documentation governing any Permitted Refinancing Indebtedness refinancing or replacing such Effective Date Financing Documentation and (ii) with respect to each Financed Enterprise with respect to any other provision (other than any provision in Section 5) in this Guarantee, the most restrictive correlative provision or provisions in the Effective Date Financing Documentation or in the documentation governing any Permitted Refinancing Indebtedness refinancing or replacing such Effective Date Financing Documentation, as the same may from time to time be amended, supplemented, amended and restated or otherwise modified and in effect on such date.
"Credit Agreement" means the Credit Agreement dated as of December 11, 2003 among the Borrower, the Lenders and the Administrative Agent.
"Debt Rating" means, with respect to any Person, a rating of such Person's long-term debt which is not secured or supported by a guarantee, letter of credit or other form of credit enhancement. If Moody's or S&P shall have changed its system of classifications after the date hereof, a Debt Rating shall be considered to be at or above a specified level if it is at or above the new rating which most closely corresponds to the specified level under the old rating system.
"Default" has the meaning set forth in the Credit Agreement.
"Disposition" means any sale, assignment, transfer or other disposition of any property (whether now owned or hereafter acquired) by the Guarantor or any of its Subsidiaries or any of its Joint Enterprises to any other Person. The verb "Dispose" shall have a correlative meaning.
Notwithstanding the preceding, the following items shall not be deemed to be Dispositions:
(a) any assignment of property for security purposes to the extent not prohibited by this Agreement or, in the case of any Financed Enterprise, any Correlative Financing Provisions;
(b) any sale, assignment, transfer or other disposition of any property sold or disposed of in the ordinary course of business and on ordinary business terms;
(c) any single transaction or series or related transactions that involves assets having a fair market value of less than $15,000,000;
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(d) the sale or other disposition of cash or Cash Equivalent Investments;
(e) the incurrence of Liens permitted pursuant to Section 5.02 and the disposition of assets related thereto by the secured party pursuant to a foreclosure;
(f) a Restricted Payment that is permitted pursuant to Section 5.06 or an Investment that is permitted pursuant to Section 5.03;
(g) any sale or lease of obsolete equipment or other assets that are no longer being used by the Borrower or any of its Subsidiaries; and
(h) a disposition resulting from the exercise by a governmental authority of its claimed or actual power of eminent domain, in each case without compensation.
"Dollar" and the sign "$" mean lawful money of the United States.
"Edison International" means Edison International, a California corporation.
"Edison Mission Overseas" means Edison Mission Overseas Co., a Delaware corporation.
"Effective Date" means the date the Credit Agreement becomes effective pursuant to Section 5.1 of the Credit Agreement.
"Effective Date Financing Documentation" means, with respect to each Financed Enterprise, documentation governing each Financing of such Financed Enterprise as in effect on the Effective Date, copies of which have heretofore been furnished to the Administrative Agent.
"EME" means Edison Mission Energy, a Delaware corporation.
"EMMH" means Edison Mission Midwest Holdings Co., a Delaware corporation.
"Environmental Laws" means all applicable federal, state or local statutes, laws, ordinances, codes, rules, regulations and guidelines (including consent decrees and administrative orders) relating to Hazardous Materials and/or to public health and protection of the environment, including the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, and the Resource Conservation and Recovery Act, as amended.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and any successor statute of similar import, together with the regulations thereunder, in each case as in effect from time to time. References to sections of ERISA also refer to any successor sections.
"Event of Default" has the meaning set forth in Section 8.1 of the Credit Agreement.
"Excess Funding Guarantor" has the meaning set forth in Section 2.10.
"Excess Payment" has the meaning set forth in Section 2.10.
"Financed Subsidiary" means as of the Effective Date, MWG, EMMH, Collins Holdings and Edison Mission Overseas.
"Financed Enterprise" means, individually, each Financed Subsidiary and each Joint Enterprise.
"Financing" means, with respect to any Person, either Indebtedness of such Person or Lease Obligations of such Person, or a combination of both.
"GAAP" means generally accepted accounting principles in effect in the United States.
"Governmental Approval" has the meaning set forth in Section 3.3.
"Guarantor" has the meaning set forth in the recitals of this Agreement.
"Guaranteed Obligations" has the meaning set forth is Section 2.09.
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"Hazardous Material" means:
(a) any "hazardous substance", as defined by any Environmental Law;
(b) any "hazardous waste", as defined by any Environmental Law;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic chemical, material or substance within the meaning of any Environmental Law.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in this Agreement refer to this Agreement as a whole and not to any particular Section, paragraph or provision of this Agreement.
"including" means including without limiting the generality of any description preceding such term, and, for purposes of this Agreement, the parties thereto agree that the rule of ejusdem generis shall not be applicable to limit a general statement, which is followed by or referable to an enumeration of specific matters, to matters similar to the matters specifically mentioned.
"Indebtedness" of any Person means, without duplication:
(a) all indebtedness for borrowed money;
(b) all obligations issued, undertaken or assumed as the deferred purchase price of property or services which purchase price is due more than six months from the date of incurrence of the obligation in respect thereof or is evidenced by a note or other instrument, except trade accounts arising in the ordinary course of business;
(c) all reimbursement obligations with respect to surety bonds, letters of credit (to the extent not collateralized with cash or Cash Equivalent Investments), bankers' acceptances and similar instruments (in each case, whether or not matured);
(d) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses;
(e) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to property acquired by the Person (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property);
(f) all Capitalized Lease Liabilities;
(g) all net obligations with respect to sales of foreign exchange options;
(h) all indebtedness referred to in clauses (a) through (g) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property (including accounts and contracts rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness; and
(i) all Contingent Liabilities.
For all purposes of this Agreement, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer.
"Investment" means, relative to any Person:
(a) any loan or advance made by such Person to any other Person (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business);
(b) any Contingent Liability of such Person; and
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(c) any ownership or similar interest held by such Person in any other Person.
The amount of any Investment shall be the original principal or capital amount thereof less all returns of principal or equity thereon (and without adjustment by reason of the financial condition of such other Person) and shall, if made by the transfer or exchange of property other than cash, be deemed to have been made in an original principal or capital amount equal to the fair market value of such property.
"Joint Enterprise" means a general partnership, limited partnership, joint venture or similar entity in which the Guarantor or a Subsidiary is a partner, joint venturer or equity participant. The term "Joint Enterprise" shall exclude, to the extent included, partnerships or other business entities included in the definition of "Subsidiary".
"Lease Obligations" means rent, supplemental rent, termination value, or a similar monetary obligation under, or pursuant to, a lease or related documents in connection with a leveraged lease transaction (including Contingent Liabilities related thereto).
"Lenders" has the meaning set forth in the Credit Agreement.
"Lien" means any security interest, mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or otherwise), charge against or interest in property, in each case of any kind, to secure payment of a debt or performance of an obligation.
"Loan" has the meaning set forth in Section 2.1 of the Credit Agreement.
"Loan Documents" has the meaning set forth in the Credit Agreement.
"Material Adverse Effect" means any event, development or circumstance that has had or would reasonably be expected to have a material adverse effect on (a) the business, assets, property, condition (financial or otherwise) or operations of the Guarantor and its Subsidiaries, taken as a whole since the Effective Date, or (b) the ability of the Guarantor to perform its obligations under this Agreement.
"Moody's" means Moody's Investors Service, a division of Dun & Bradstreet Corporation, and its successors and assigns.
"MWG" means Midwest Generation LLC, a Delaware limited liability company.
"Net After-Tax Cash Proceeds" has the meaning set forth in the Credit Agreement.
"Operating Subsidiary" means any Subsidiary whose activities include significant commercial activities, other than holding the equity or debt of another Person.
"Organic Document" means, with respect to any Person that is a corporation, its certificate of incorporation, its by-laws and all shareholder agreements, voting trusts and similar arrangements applicable to any of its authorized shares of capital stock; and, with respect to any Person that is a limited liability company, its certificate of formation and its limited liability agreement, in each case, as from time to time amended, supplemented, amended and restated, or otherwise modified and in effect from time to time.
"Pension Plan" means a "pension plan", as such term is defined in Section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer plan as defined in Section 4001(a)(3) of ERISA), and to which the Borrower or any corporation, trade or business that is, along with the Guarantor, a member of a Controlled Group, has any liability, including any liability by reason of having been a substantial employer within the meaning of Section 4063 of ERISA at any time during the preceding five years, or by reason of being deemed to be a contributing sponsor under Section 4069 of ERISA.
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"Permitted Contractual Restrictions" means (a) Contractual Restrictions in effect on the Effective Date (including Contractual Restrictions contained in charter documents of any Person on the Effective Date) and (b) Contractual Restrictions in effect after the Effective Date arising out of Permitted Refinancing Indebtedness incurred by the Borrower and its Subsidiaries (so long as such Contractual Restrictions relate solely to the borrower and its subsidiaries (or any of the Guarantor or its Subsidiaries that are guarantors, pledgors or other collateral providers in connection such Permitted Refinancing Indebtedness and their respective Subsidiaries)).
"Permitted EME Intercompany Indebtedness" means intercompany Indebtedness of the Guarantor and/or Subsidiaries of the Guarantor issued or incurred to EME directly arising out of or in connection with (a) intercompany Indebtedness for working capital, (b) Indebtedness in connection with hedging obligations of Guarantor and/or its Subsidiaries in connection with their operations and (c) Indebtedness incurred in connection with letters of credit obtained in the support of trading activities of the Guarantor and/or it Subsidiaries.
"Permitted Intercompany Indebtedness" means intercompany indebtedness between the Guarantor and Subsidiaries of the Guarantor or between Subsidiaries of the Guarantor directly arising out of or in connection with (a) Restricted Payments intended ultimately to be received by the Guarantor, (b) intercompany indebtedness for working capital, (c) Indebtedness incurred in the ordinary course of business, (d) additional Indebtedness incurred after the Effective Date consisting of: (i) intercompany loans evidenced by intercompany notes between the Guarantor and its Subsidiaries; (ii) hedging obligations of Guarantor and/or its Subsidiaries in connection with their operations; and (iii) letters of credit obtained in the support of trading activities of the Guarantor and/or it Subsidiaries and (e) Investments by the Guarantor or the Subsidiaries of the Guarantor in Subsidiaries of the Guarantor; provided, that no Material Adverse Effect would reasonably be expected to occur as a result of the incurrence of such intercompany Indebtedness.
"Permitted Refinancing Indebtedness" means, with respect to any Person, any refinancing of a Financing of such Person (or a related Financed Enterprise as set forth in the proviso below) issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund (collectively, "refinance") other Financings of such Person (or a related Financed Enterprise as set forth in the proviso below); provided, that (a) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the aggregate principal amount (or accreted value or termination value, if applicable) of the Financing being refinanced (plus all accrued interest thereon and the amount of all expenses and premiums in connection therewith) unless a corresponding payment is made in accordance with Section 3.1.2(a)(viii) of the Credit Agreement, (b) the maturity date of the Permitted Refinancing Indebtedness is no earlier than the maturity date of the Financing being refinanced and such Permitted Refinancing Indebtedness has a weighted average life to maturity equal to or greater than the weighted average life to maturity of the Financing being refinanced, provided, that for purposes of this provision and clause (d) below, the maturity of the Lease Obligations related to the Collins facility shall be deemed to be December 8, 2004, (c) subject to clause (d) below, any Contractual Restrictions incurred in connection with such Permitted Refinancing Indebtedness are (as determined in good faith by the Borrower's Board of Directors, the determination of which shall be evidenced by a resolution of such Board of Directors) no more restrictive on such Person or its Subsidiaries or Affiliates than the Financing being refinanced taken as a whole and (d) with respect to any refinancings within 12 months of the maturity date of such Financing, such Permitted Refinancing Indebtedness may contain Contractual Restrictions that are in the written opinion of the Borrower's chief executive officer or chief financial officer required by the lenders in order to obtain such refinancings, are customary for such refinancings and apply only to the assets of or revenues of the Person which is the subject of the refinancing, provided that for purposes of this provision, the maturity of the Lease Obligations related to the Collins facility shall be deemed to be December 8, 2004; provided that, a Financing of one Financed Enterprise may be refinanced by
A-6
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another Financed Enterprise or who shall be deemed to be a Financed Enterprise for purposes of this definition.
"Person" means any natural person, corporation, partnership, limited liability company, firm, association, trust, government, governmental agency or any other entity, whether acting in an individual, fiduciary or other capacity.
"Pro Rata Share" has the meaning set forth in Section 2.10.
"Relevant Public Filings" means public filings of EME and Midwest Generation LLC with the Securities and Exchange Commission prior to the Effective Date
"Restricted Payment" means any dividend on, or any payment on account of, or setting apart assets for a sinking or other analogous fund for, the purchase, redemption, defeasance, retirement or other acquisition of, any shares of any class of capital stock of or other ownership interest or any warrants or options to purchase any such stock or ownership interest, whether now or hereafter outstanding, or making of any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of the Person making such dividend or payment.
"S&P" means Standard & Poor's Ratings Services and its successors and assigns.
"Security Documents" has the meaning set forth in the Credit Agreement.
"Subsidiary" means, with respect to any Person: (a) any corporation, association or other business entity of which more than 50% of the outstanding capital stock having ordinary voting power to elect a majority of the directors, managers or trustees of such corporation (irrespective of whether at the time capital stock of any other class or classes of such corporation shall or might have voting power upon the occurrence of any contingency) is at the time directly or indirectly owned by such Person, by such Person and one or more other Subsidiaries of such Person, or by one or more other Subsidiaries of such Person; and (b) any partnership (i) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (ii) the only general partners of which are such Person or one or more Subsidiaries of such Person (or any combination thereof).
"United States" or "U.S." means the United States of America, its fifty States and the District of Columbia.
"Welfare Plan" means a "welfare plan", as such term is defined in Section 3(1) of ERISA.
A-7
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SCHEDULE 3.08(a)
1.UCC-1 dated October 19, 2001, in favor of First Access covering One Toyota 7FGU30, S/N 62257, 159 FSV, Gas Powered, Dual Hosting Smart Alarm, Side Shifter 48 inch Forrs.
2.UCC-1 dated March 10, 03 in favor of First Access covering one Toyota 6FGU30 S/N 60749, 171 TSU
3.UCC-1 dated April 8, 2003 in favor of First Access covering used Toyota Forklift Model 02-6FGU30 S/N: 60749
4.UCC-1 dated April 9, 2003 in favor of Comark Capital Leasing Services covering office equipment, now or hereafter leased to and/or financed for debtor/lessee by secured party/lessor, and including all replacements, upgrades and substitutions hereafter occurring to all of the foregoing equipment and all now existing and future attachments, parts, accessories and add-ons for all of the foregoing items and types of equipment, and all proceeds and products thereof.
A-8
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Midwest Generation EME LLC Indebtedness At November 30, 2003 Schedule 5.01 to the Guarantee
Principal
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Interest
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Total
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(Rounded to nearest thousand)
Due to Shareholders: Interco Loan-Edison Mission Energy $ 48,640,000 $ 2,420,330 $ 51,060,330
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Total Intercompany Loans $ 48,640,000 $ 2,420,330 $ 51,060,330
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A-9
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"EXHIBIT 10.25 As disclosed in the annual report on form 10-K filed by Midwest Generation, this is not an agreement to which Midwest Generation is a party. However, because it contains a number of provisions to which Midwest Generation is bound, it is incorporated by reference. This caption does not constitute a part of the Guarantee. -------------------------------------------------------------------------------- GUARANTEE Dated as of December 11, 2003 in favor of CITICORP NORTH AMERICA, INC., as Administrative Agent made by MIDWEST GENERATION EME, LLC as Guarantor -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- GUARANTEE dated as of December 11, 2003, between MIDWEST GENERATION EME, LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (the \"Guarantor\"); and CITICORP NORTH AMERICA, INC, as administrative agent for the lenders or other financial institutions or entities party, as lenders, to the Credit Agreement referred to below (in such capacity, together with its successors in such capacity, the \"Administrative Agent\"). Mission Energy Holdings International, Inc., a corporation organized under the laws of the State of Delaware (the \"Borrower\"), certain lenders and the Administrative Agent are parties to a Credit Agreement dated as of December 11, 2003 (as modified and supplemented and in effect from time to time, the \"Credit Agreement\"), providing, subject to the terms and conditions thereof, for loans to be made by said lenders to the Borrower in an aggregate principal amount not exceeding $800,000,000.",
"To induce said lenders to enter into the Credit Agreement and to extend credit thereunder, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Guarantor has agreed (to the extent hereinafter provided), along with the other BV Holdings Guarantors, to jointly and severally guarantee the Guaranteed Obligations (as hereinafter defined). Accordingly, the parties hereto agree as follows: Section 1. Definitions. Capitalized terms not otherwise defined herein shall have the meanings set forth in Annex A hereto. Section 2. The Guarantee. 2.01 The Guarantee. Subject to the limitations set forth in Sections 2.08 and 2.09, the Guarantor hereby, along with the other BV Holdings Guarantors, jointly and severally guarantee to each Lender and the Administrative Agent and their respective successors and assigns the prompt payment in full when due (whether at stated maturity, by acceleration or otherwise) of the principal of and interest on the Loans made by the Lenders to the Borrower and all other amounts from time to time owing to the Lenders or the Administrative Agent by the Borrower under the Credit Agreement, in each case strictly in accordance with the terms thereof (such obligations being herein collectively called the \"Guaranteed Obligations\"). The Guarantor hereby further agrees that if the Borrower shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantor, along with the other BV Holdings Guarantors, jointly and severally will promptly pay the same, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal.",
"2.02 Obligations Unconditional. Subject to the limitations set forth in Sections 2.08 and 2.09, the obligations of the Guarantor under Section 2.01 (along with the obligations of the other BV Holdings Guarantors under the other BV Holdings Guarantees) are absolute and unconditional, joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the Credit Agreement or any other agreement or instrument referred to herein, or any substitution, release or exchange of any other guarantee of or security for any of the Guaranteed Obligations, and, to the fullest extent permitted by applicable law, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor, it being the intent of this Section 2.02 that the obligations of the Guarantor hereunder (and the obligations of the other BV Holdings Guarantors under the other BV Holdings Guarantees) shall be absolute and unconditional, joint and several, under any and all circumstances. Without limiting the generality of the foregoing, it is agreed that the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantor hereunder which shall remain absolute and unconditional as described above: (i) at any time or from time to time, without notice to the Guarantor, the time for any performance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived; -------------------------------------------------------------------------------- (ii) any of the acts mentioned in any of the provisions of the Credit Agreement or any other agreement or instrument referred to herein shall be done or omitted; (iii) the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the Guaranteed Obligations shall be modified, supplemented or amended in any respect, or any right under the Credit Agreement or any other agreement or instrument referred to herein shall be waived or any other guarantee of any of the Guaranteed Obligations or any security therefor shall be released or exchanged in whole or in part or otherwise dealt with; or (iv) any lien or security interest granted to, or in favor of, the Administrative Agent or any Lender or Lenders as security for any of the Guaranteed Obligations shall fail to be perfected.",
"The Guarantor hereby expressly waives, to the extent permitted by applicable law, diligence, presentment, demand of payment, protest and all notices whatsoever, and any requirement that the Administrative Agent or any Lender exhaust any right, power or remedy or proceed against the Borrower under the Credit Agreement or any other agreement or instrument referred to herein, or against any other Person under any other guarantee (including other BV Holdings Guarantees) of, or security for, any of the Guaranteed Obligations. 2.03 Reinstatement. The obligations of the Guarantor under this Section 2 shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of the Borrower in respect of the Guaranteed Obligations is rescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, and the Guarantor, along with the other BV Holdings Guarantors, jointly and severally agree that they will indemnify the Administrative Agent and each Lender on demand for all reasonable costs and expenses (including, without limitation, fees of counsel) incurred by the Administrative Agent or such Lender in connection with such rescission or restoration, including any such costs and expenses incurred in defending against any claim alleging that such payment constituted a preference, fraudulent transfer or similar payment under any bankruptcy, insolvency or similar law. 2.04 Subrogation.",
"The Guarantor hereby waives all rights of subrogation or contribution, whether arising by contract or operation of law (including, without limitation, any such right arising under the Federal Bankruptcy Code) or otherwise by reason of any payment by it pursuant to the provisions of this Section 2 and further agrees with the Borrower for the benefit of each of its creditors (including, without limitation, each Lender and the Administrative Agent) that any such payment by it shall constitute a contribution of capital by the Guarantor to the Borrower (or an investment in the equity capital of the Borrower by the Guarantor). 2.05 Remedies. The Guarantor, along with the other BV Holdings Guarantors, jointly and severally agree that, as between the Guarantor, the other BV Holdings Guarantors and the Lenders, the obligations of the Borrower under the Credit Agreement may be declared to be forthwith due and payable as provided in Section 8.3 of the Credit Agreement (and shall be deemed to have become automatically due and payable in the circumstances provided in said Section 8.2 of the Credit Agreement) for purposes of Section 2.01 notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against the Borrower and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by the Borrower) shall forthwith become due and payable by the Guarantor for purposes of Section 2.01.",
"2.06 Instrument for the Payment of Money; Post-Default Interest. The Guarantor hereby acknowledges that the guarantee in this Section 2 constitutes an instrument for the payment of money, and consents and agrees that any Lender or the Administrative Agent, at its sole option, in the event of a dispute by the Guarantor in the payment of any moneys due hereunder, shall have the right to bring motion action under New York CPLR Section 3213. In addition, the Guarantor hereby agrees that (without regard to the limitation contained in Section 2.09) in the event it shall fail to pay in full any amount owing by it hereunder on the date upon which the same shall become due (whether upon demand or otherwise), it shall be obligated to pay interest at the Post-Default Rate in respect of such -------------------------------------------------------------------------------- amount for each day during the period from and including the due date thereof to but excluding the date the same shall be paid in full, such interest to be payable upon demand of the Administrative Agent. 2.07 Continuing Guarantee. The guarantee in this Section 2 is a continuing guarantee, and shall apply to all Guaranteed Obligations whenever arising. 2.08 General Limitation on Guarantee Obligations.",
"In any action or proceeding involving any state corporate law, or any state or Federal bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if the obligations of the Guarantor under Section 2.01 would otherwise be held or determined to be void, invalid or unenforceable, or subordinated to the claims of any other creditors, on account of the amount of its liability under Section 2.01, then, notwithstanding any other provision hereof to the contrary, the amount of such liability shall, without any further action by the Guarantor, the Administrative Agent, the Lenders or any other Person, be automatically limited and reduced to the highest amount that is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding. 2.09 Dollar Limitation on Guarantee Obligations. Notwithstanding the foregoing provisions of this Section 2, the aggregate amount that the Guarantor may be required to pay under Section 2.01, plus the amounts required to be paid by the other BV Holdings Guarantors under the other BV Holdings Guarantees, shall not exceed an amount equal to the principal amount of the Loans on the Closing Date (and if less the aggregate principal amount of the Loans outstanding at any time), plus accrued and unpaid interest (whether due after acceleration or otherwise, applicable fees, expenses and all other amounts payable with respect to such Loans under the Loan Documents.",
"2.10. Rights of Contribution. The Guarantor hereby agrees, and each other BV Holdings Guarantor has agreed in its respective BV Holdings Guarantee that, as between themselves, that if any of the BV Holdings Guarantors shall become an Excess Funding Guarantor (as defined below) by reason of the payment by such BV Holdings Guarantor of any Guaranteed Obligations, each other BV Holdings Guarantor shall, on demand of such Excess Funding Guarantor (but subject to the next sentence), pay to such Excess Funding Guarantor an amount equal to such BV Holdings Guarantor's Pro Rata Share (as defined below and determined, for this purpose, without reference to the properties, debts and liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined below) in respect of such Guaranteed Obligations. The payment obligation of a BV Holdings Guarantor to any Excess Funding Guarantor under this Section 2.10 shall be subordinate and subject in right of payment to the prior payment in full of the obligations of such BV Holdings Guarantor under the other provisions of this Article and such Excess Funding Guarantor shall not exercise any right or remedy with respect to such excess until payment and satisfaction in full of all of such obligations.",
"For purposes of this Section 2.10, (i) \"Excess Funding Guarantor\" means, in respect of any Guaranteed Obligations, a BV Holdings Guarantor that has paid an amount in excess of its Pro Rata Share of such Guaranteed Obligations, (ii) \"Excess Payment\" means, in respect of any Guaranteed Obligations, the amount paid by an Excess Funding Guarantor in excess of its Pro Rata Share of such Guaranteed Obligations and (iii) \"Pro Rata Share\" means, for any BV Holdings Guarantor, the ratio (expressed as a percentage) of (x) the amount by which the aggregate present fair saleable value of all properties of such BV Holdings Guarantor (excluding any shares of stock of any other BV Holdings Guarantor) exceeds the amount of all the debts and liabilities of such BV Holdings Guarantor (including contingent, subordinated, unmatured and unliquidated liabilities, but excluding the obligations of such BV Holdings Guarantor hereunder and any obligations of any other BV Holdings Guarantor that have been Guaranteed by such BV Holdings Guarantor) to (y) the amount by which the aggregate fair saleable value of all properties of all of the BV Holdings Guarantors exceeds the amount of all the debts and liabilities (including contingent, subordinated, unmatured and unliquidated liabilities, but excluding the obligations of the Borrower and the BV Holdings Guarantors hereunder and under the other Loan Documents) of all of the BV Holdings Guarantors.",
"-------------------------------------------------------------------------------- Section 3. Representations and Warranties. The Guarantor represents and warrants as of the Effective Date with respect to itself and with respect to its Subsidiaries, to the Lenders and the Administrative Agent that: 3.01 Organization; Power; Compliance with Law and Contractual Obligations. Each of the Guarantor and its Subsidiaries (a) is a corporation or a limited liability company validly organized and existing and in good standing under the laws of the state of its incorporation or organization, (b) is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction where the nature of its business requires such qualification, (c) has all requisite corporate or limited liability company power and authority and holds all material requisite governmental licenses, permits and other approvals to conduct its business substantially as currently conducted by it and, in the case of the Guarantor, perform its obligations hereunder and (d) is in compliance with all laws, governmental regulations (including ERISA and Federal Reserve regulations), court decrees, orders and Contractual Obligations applicable to it, except, with respect to clauses (b), (c) and (d) to the extent that the failure to comply therewith would not reasonably be expected to have a Material Adverse Effect.",
"3.02 Due Authorization; Non-Contravention. The execution, delivery and performance by the Guarantor of this Agreement is within the Guarantor's limited liability company powers, has been duly authorized by all necessary limited liability company action, and does not: (a) contravene the Guarantor's Organic Documents; (b) contravene any law, governmental regulation, court decree or order or material Contractual Obligation binding on or affecting the Guarantor or its Subsidiaries; or (c) result in, or require the creation or imposition of, any Lien on any of the Guarantor's or its Subsidiaries' properties. 3.03 Governmental Approval; Regulation. (a) No authorization, consent, approval, license, exemption of or filing or registration with any court or governmental authority or regulatory body (\"Governmental Approval\") is required for the Guarantor to execute and perform its obligations hereunder, except for those which have been duly obtained or effected.",
"No material Governmental Approval is required for the Guarantor or its Subsidiaries to carry on its business, except for those which have been duly obtained or effected. (b) Neither the Guarantor nor its Subsidiaries is (i) subject to any regulation as an \"investment company\" under the Investment Company Act of 1940, as amended, or (ii) a \"holding company\" or a \"subsidiary\" or an \"affiliate\" of a \"holding company\" that is subject to the Public Utility Holding Company Act of 1935, as amended, except Section 9(a)(2), 32 or 33 thereof. The Guarantor or its Subsidiaries are not otherwise subject to any regulation as a \"public utility\" under any other applicable law, rule or regulation, which would have a Material Adverse Effect. 3.04 Validity.",
"This Agreement constitutes the legal, valid and binding obligations of the Guarantor enforceable in accordance with their respective terms (except as may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights generally and general principles of equity). 3.05 Financial Information. The unaudited consolidated balance sheet of the Guarantor and its Subsidiaries as at December 31, 2002, and the related consolidated statement of income of the Guarantor and its Subsidiaries, copies of which have been furnished to the Administrative Agent, have been prepared using GAAP and present fairly in all material respects the consolidated financial condition of the Guarantor and its Subsidiaries as at the dates thereof and the results of their operations for the period then ended. 3.06 No Material Adverse Change.",
"There has not occurred any event or condition having a Material Adverse Effect since December 31, 2002, except as otherwise disclosed in the Relevant Public Filings. -------------------------------------------------------------------------------- 3.07 Litigation. Except as disclosed in the Relevant Public Filings, there is no pending or, to the knowledge of the Guarantor or its Subsidiaries, threatened litigation, action, proceeding, or labor controversy affecting the Guarantor or its Subsidiaries, or any of its properties, businesses, assets or revenues, which, if adversely determined (taking into account any insurance proceeds payable under a policy where the insurer has accepted coverage without any reservations), would have a Material Adverse Effect or which purports to adversely affect the legality, validity or enforceability of this Agreement. 3.08 Ownership of Properties.",
"(a) Except as set forth (i) on Schedule 3.08(a) hereto and (ii) in the Correlative Financing Provisions, each of the Guarantor and its Subsidiaries owns good and marketable title to, or a valid leasehold interest in or other enforceable interest in all properties and assets, real and personal, tangible and intangible, of any nature whatsoever (including patents, trademarks, trade names, service marks and copyrights) purported to be owned, leased or held by it, free and clear of all Liens, charges or claims (including infringement claims with respect to patents, trademarks, copyrights and the like) except as permitted pursuant to Section 5.02. (b) The properties and assets of each of the Guarantor and its Subsidiaries are separately identifiable and are not commingled with the properties and assets of any other entity, except that for certain internal organizational, but not legal, purposes, the Illinois plants operated by the Subsidiaries of the Guarantor as well as the Homer City plant operated by an Affiliate of the Guarantor are sometimes referred to collectively as Midwest Generation.",
"The properties and assets of each of the Guarantor and its Subsidiaries are readily distinguishable from the properties and assets of EME. 3.09 Taxes. Each of the Guarantor and its Subsidiaries has filed all tax returns and reports required by law to have been filed by it and has paid all taxes and governmental charges thereby shown to be owing, except any such taxes or charges which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books. 3.10 Pension and Welfare Plans. During the consecutive twelve-month period prior to the date of the execution and delivery of this Agreement, no steps have been taken to terminate any Pension Plan, and no contribution failure has occurred with respect to any Pension Plan sufficient to give rise to a Lien under Section 302(f) of ERISA. No condition exists or event or transaction has occurred with respect to any Pension Plan which would reasonably be expected to result in the incurrence by the Guarantor or any member of the Controlled Group of any material liability (other than liabilities incurred in the ordinary course of maintaining the Pension Plan), fine or penalty.",
"Neither the Guarantor nor any member of the Controlled Group has any contingent liability with respect to any post-retirement benefit under a Welfare Plan which would reasonably be expected to have a Material Adverse Effect, other than liability for continuation coverage described in Part 6 of Title I of ERISA. 3.11 Environmental Warranties. (a) All facilities and property owned or leased by the Guarantor or any of its Subsidiaries or, to its knowledge, Joint Enterprises have been, and continue to be, owned or leased by the Guarantor and its Subsidiaries in compliance with all Environmental Laws, except where the failure so to comply would not have, or be reasonably expected to have, a Material Adverse Effect. (b) Except as disclosed in the Relevant Public Filings, there are no pending or, to the knowledge of the Guarantor, threatened: (i) claims, complaints, notices or requests for information received by the Guarantor or its Subsidiaries from governmental authorities with respect to any alleged violation by the Guarantor or its Subsidiaries of any Environmental Law that, singly or in the aggregate, have, or would reasonably be expected to have, a Material Adverse Effect; or -------------------------------------------------------------------------------- (ii) complaints, notices or inquiries to the Guarantor or its Subsidiaries from governmental authorities regarding potential liability under any Environmental Law that, singly or in the aggregate, have, or would reasonably be expected to have, a Material Adverse Effect.",
"(c) (i) To the knowledge of the Guarantor and except as have been disclosed in the Relevant Public Filings, there have been no Releases (as defined under any Environmental Law) of Hazardous Materials prior to December 15, 1999 at, on or under any property now or previously owned or leased by the Guarantor or its Subsidiaries and (ii) except as have been disclosed in the Relevant Public Filings after December 15, 1999, there have been no Releases (as defined under any Environmental Law) of Hazardous Materials at, on or under any property now or previously owned or leased by the Guarantor or its Subsidiaries that, singly or in the aggregate, have, or would reasonably be expected to have, a Material Adverse Effect.",
"(d) Each of the Guarantor and its Subsidiaries has obtained and is in compliance with all permits, certificates, approvals, licenses and other authorizations relating to environmental matters and necessary for the Guarantor's or its Subsidiaries' business, except where the failure to obtain, maintain or comply with such permits, certificates, approvals, licenses or other authorizations would not have, or be reasonably expected to have, a Material Adverse Effect. (e) To the reasonable knowledge of the Guarantor, no property now or previously owned or leased by the Guarantor or its Subsidiaries is listed or proposed for listing (with respect to owned property only) on the National Priorities List pursuant to any Environmental Law, on the CERCLIS or on any similar state list of sites requiring investigation or clean-up. (f) No conditions exist at, on or under any property now or previously owned or leased by the Guarantor or its Subsidiaries which, with the passage of time, or the giving of notice or both, would give rise to liability under any Environmental Law which liability would have, or would reasonably be expected to have, a Material Adverse Effect. 3.12 Regulations T, U and X.",
"Neither the Guarantor nor its Subsidiaries is engaged in the business of extending credit for the purpose of purchasing or carrying margin stock, and no proceeds of any Loans will be used for a purpose which violates, or would be inconsistent with, F.R.S. Board Regulation T, U or X. Terms for which meanings are provided in F.R.S. Board Regulation T, U or X or any regulations substituted therefore, as from time to time in effect, are used in this Section 3.12 with such meanings. 3.13 The Obligations. Except as set forth in Schedule 5.01, this Agreement is the only outstanding Indebtedness of the Guarantor.",
"3.14 Separateness. (a) The Guarantor and its Subsidiaries maintain separate bank accounts and separate books of account from those bank accounts and books of account of EME and any other entity. The separate liabilities of the Guarantor and its Subsidiaries are readily distinguishable from the liabilities of EME. (b) Although the Guarantor and its Subsidiaries generally do business under the collective name of \"Midwest Generation,\" each of the Guarantor and its Subsidiaries enters into contractual relations solely in its own name in a manner not misleading to other Persons as to its identity. Without limiting the generality of the foregoing, all invoices, purchase orders, contracts, statements, and applications are made solely in the name of the Guarantor or its Subsidiaries, if related to the Guarantor or its Subsidiaries. (c) The Guarantor is a 100% wholly owned direct Subsidiary of EME.",
"Section 4. Affirmative Covenants. The Guarantor agrees, with respect to itself and with respect to Subsidiaries and Joint Enterprises, if any, it may have now or in the future that, until the payment and satisfaction in full of the Guaranteed Obligations: 4.01 Financial Information, Reports, Notices. The Guarantor will furnish, or will cause its Subsidiaries to furnish, to the Administrative Agent (a) copies of the financial statements, reports, -------------------------------------------------------------------------------- notices and information required to be furnished pursuant to Section 7.11 of the Credit Agreement, (b) copies of the documents governing Permitted Refinancing Indebtedness of each Financed Subsidiary referred to in the definition of \"Correlative Financing Provisions\" and all amendments, supplements and modifications thereto and (c) other information reasonably requested by the Administrative Agent. 4.02 Compliance with Laws. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, comply in all material respects with all applicable laws, rules, regulations and orders, such compliance to include the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property (except to the extent non-compliance would not reasonably be expected to have a Material Adverse Effect and to the extent that such assignments and charges are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books); provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).",
"4.03 Maintenance of Properties. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, maintain, preserve, protect and keep its property and equipment in good repair, working order and condition (ordinary wear and tear excepted), and make necessary and proper repairs, renewals and replacements so that its business carried on in connection therewith may be properly conducted at all times unless the Guarantor determines in good faith that the continued maintenance of any of its properties or equipment is no longer economically desirable and except where the failure so to do would not have a Material Adverse Effect; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).",
"4.04 Insurance. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, maintain or cause to be maintained with responsible insurance companies insurance with respect to its properties and business against such casualties and contingencies and of such types and in such amounts as is customary in the case of similar businesses and in a similar geographic region; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor). 4.05 Books and Records.",
"The Guarantor will: (a) keep books and records separate from the books and records of its Affiliates or any other entity which accurately reflect all of its business affairs, transactions and the documents and other instruments that underlie all limited liability company actions; (b) cause each of its Subsidiaries to keep books and records which accurately reflect their affairs and transactions; (c) keep separate books and records from EME and separately identify its own property, assets, liabilities and financial affairs from EME; and (d) permit the Administrative Agent and Lenders (at such Lender's expense) or any of their respective representatives, at reasonable times and intervals upon reasonable prior notice, to visit all of its offices, to discuss its financial matters with its officers and independent public accountant.",
"-------------------------------------------------------------------------------- The Guarantor will at any reasonable time and from time to time upon reasonable prior notice, permit the Administrative Agent or any of their respective agents or representatives to examine and make copies of and abstracts from the records and books of account of the Guarantor; provided that by virtue of this Section 4.05 the Guarantor shall not be deemed to have waived any right to confidential treatment of the informational obtained, subject to the provisions of applicable law or court order. 4.06 Environmental Covenant. The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to: (a) use and operate all of its facilities and properties in compliance with all Environmental Laws, keep all necessary permits, approvals, certificates, licenses and other authorizations relating to environmental matters in effect and remain in material compliance therewith, and handle all Hazardous Materials in material compliance with all applicable Environmental Laws, in each case where the failure to do so may reasonably be expected to have a Material Adverse Effect; and (b) provide such non-privileged information as the Administrative Agent may reasonably request from time to time to evidence compliance with this Section 4.06; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor). 4.07 Conduct of Business and Maintenance of Existence.",
"The Guarantor will, and will cause each of its Subsidiaries and will use reasonable efforts to cause each of its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, continue to engage in business of the same type as now conducted by it and preserve, renew and keep in full force and effect its existence (corporate or otherwise) and good standing in the state of its organization and take all reasonable action to maintain all material rights, privileges and franchises necessary or desirable in the normal conduct of its business, except, in each case, as otherwise permitted by Sections 5.04 and 5.05; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor). 4.08 Separateness. The Guarantor will: (a) act solely in its name and through its duly authorized officers or agents in the conduct of its businesses; (b) except as described in Section 3.14(b), conduct its business solely in its own name, in a manner not misleading to other Persons as to its identity, (without limiting the generality of the foregoing, all invoices, purchase orders, contracts, statements, and applications are made and shall continue to be made solely in the name of the Guarantor, if related to the Guarantor); and (c) obtain proper authorization from its managing directors or members, as required by its Organic Documents for all limited liability company actions of the Guarantor.",
"Section 5. Negative Covenants. The Guarantor agrees, with respect to itself and with respect to Subsidiaries and Joint Enterprises, if any, it may have now or in the future that, until the payment and satisfaction in full of the Guaranteed Obligations: 5.01 Restrictions on Indebtedness. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its -------------------------------------------------------------------------------- obligations to other members of such Joint Enterprise) to, create, incur, assume or suffer to exist any Indebtedness other than: (a) Indebtedness of the Guarantor set forth on Schedule 5.01 existing on the Effective Date and Indebtedness of the Guarantor's Subsidiaries or Joint Enterprises of any kind whatsoever existing on the Effective Date; (b) Permitted Refinancing Indebtedness; (c) Permitted Intercompany Indebtedness or Permitted EME Intercompany Indebtedness; (d) Indebtedness consisting of a $100,000,000 cash collateralized letter of credit facility; and (e) Indebtedness secured by Liens set forth on Schedule 3.08(a).",
"provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor). 5.02 Liens. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, create, incur, assume or suffer to exist any Lien upon any of its property, revenues or assets, whether now owned or hereafter acquired, except: (a) any Lien existing on the property of the Guarantor, the Guarantor's Subsidiaries or Joint Enterprises on the Effective Date. (b) Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books; (c) Liens (other than Liens securing Indebtedness for borrowed money or Contingent Liabilities relating to borrowed money) incurred in the ordinary course of business for sums not overdue or which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books, collectively hereunder, in no event to exceed $5,000,000 in the aggregate at any time outstanding; (d) Liens incurred in the ordinary course of business in connection with workmen's compensation, unemployment insurance or other forms of governmental insurance or benefits, or to secure performance of tenders, statutory obligations, leases and contracts (other than for borrowed money or Contingent Liabilities relating to borrowed money) entered into in the ordinary course of business or to secure obligations on surety or appeal bonds; (e) judgment Liens in existence less than 30 days after the entry thereof or with respect to which execution has been stayed or the payment of which is covered in full (subject to a customary deductible) by insurance maintained with responsible insurance companies; (f) Liens incurred by any Financed Subsidiary in connection with the Permitted Refinancing Indebtedness; and (g) Liens securing Indebtedness issued pursuant to Section 5.01(d).",
"provided that (i) in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor) and (ii) notwithstanding anything to the contrary in this Section 5.02, no intercompany note or other intercompany obligation payable to the Guarantor will be pledged, encumbered or otherwise transferred (except as pledged or encumbered under, and pursuant to, the Security Documents).",
"-------------------------------------------------------------------------------- 5.03 Investments. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, make, incur, assume or suffer to exist any Investment in any other Person, except: (a) Investments existing on the Effective Date; (b) Cash Equivalent Investments; (c) without duplication, Investments permitted as Indebtedness pursuant to Section 5.01; (d) Investments in Subsidiaries or Joint Enterprises of the Guarantor in the ordinary course of business; (e) Investments permitted pursuant to Section 5.04(b); (f) Investments in Subsidiaries or Joint Enterprises of the Guarantor primarily engaged in the power generation, power sales or power transmission business; (g) Investments to permit the Guarantor or a Subsidiary of the guarantor to directly or indirectly acquire the Indebtedness of the lessors of the Collins facility or the related Indebtedness evidenced by promissory notes issued by Midwest Funding LLC; and (h) Investments in Affiliates resulting from the issuances of letters of credit under the letter of credit facility pursuant to Section 5.01(d).",
"provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor). 5.04 Consolidation, Merger. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, liquidate or dissolve, consolidate with, or merge into or with, any other Person, or purchase or otherwise acquire all or substantially all of the assets of any Person except as permitted pursuant to Section 5.03(g) (or of any division thereof) and except: (a) any such Subsidiary of the Guarantor may liquidate or dissolve voluntarily into, and may merge with and into, any other Subsidiary of the Guarantor, and the assets or stock of any Subsidiary of the Guarantor may be purchased or otherwise acquired by any other Subsidiary of the Guarantor; (b) the Guarantor or any of its Subsidiaries may purchase all or substantially all of the assets of any Person, or acquire such person by merger; provided, that after giving effect thereto, the surviving corporation has Debt Ratings of at least BBB- from S&P and Baa3 from Moody's (with a stable outlook from both rating agencies); and (c) so long as no Default or Event of Default has occurred and is continuing or would occur after giving effect thereto, the Guarantor may consolidate with or merge into any other Person, or convey, transfer or lease its properties and assets substantially as an entirety to any person, or permit any Person to merge into or consolidate with the Guarantor if (i) the Guarantor is the surviving corporation or the surviving corporation or purchaser or lessee is a corporation incorporated under the laws of the United States of America and assumes the Guarantor's obligations under this Agreement and (ii) the surviving corporation has Debt Ratings of at least BBB- from S&P and Baa3 from Moody's (with a stable outlook from both rating agencies).",
"5.05 Asset Dispositions. The Guarantor will not, will not permit its Subsidiaries to and will use reasonable efforts to not permit its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, Dispose of, lease, contribute or otherwise convey, or grant -------------------------------------------------------------------------------- options, warrants or other rights with respect to, all or any substantial part of its assets (including accounts receivable and capital stock of Subsidiaries) to any Person, unless: (a) such Disposition, lease, contribution, conveyance or grant is to an unaffiliated third party on an arm's-length basis; (b) at least 90% of the consideration to be received is paid in cash or Cash Equivalent Investments and such remaining 10% is not a debt instrument of the Guarantor or any of its Affiliates (provided that for purposes of this provision, (i) any amounts deposited into an escrow or other type of holdback account and any consideration in the form of readily marketable securities shall be deemed to be cash, (ii) customary purchase price adjustments may be settled on a non-cash basis and (iii) the assumption of Indebtedness relating to the asset being Disposed shall be disregarded for the purposes of this provision); and (c) a mandatory prepayment of the Loan is made in an amount equal to the amount required to be made pursuant to Section 3.1.2 of the Credit Agreement as a result of the Net After-Tax Cash Proceeds of such sale; provided that, in the case of each Financed Enterprise, compliance with the Correlative Financing Provisions shall be deemed to be compliance by such Financed Enterprise with clauses (a) and (b) this Section (and the failure of such Financed Enterprise to so comply with the Correlative Financing Provisions shall be deemed to be a breach of this Section by the Guarantor).",
"5.06 Restricted Payments. The Guarantor will not make a Restricted Payment so long as a Default or Event of Default has occurred and is continuing nor will the Guarantor permit any of its Subsidiaries to make a Restricted Payment (other than Restricted Payments to the Guarantor or other Subsidiaries of the Guarantor (contemporaneously with ratable Restricted Payments to holders of minority interests, if applicable)). 5.07 Transactions with Affiliates. The Guarantor will not enter into, or cause, suffer or permit to exist any arrangement or contract with any of its Affiliates unless such arrangement or contract (i) is fair and equitable to the Guarantor, (ii) is upon fair and reasonable terms no less favorable to the Guarantor than it would obtain in a comparable arm's length transaction with a Person which is not an Affiliate and (iii) does not restrict the payment of Restricted Payments to the Guarantor or any of its Subsidiaries and its Joint Enterprises; provided, that it is understood that the foregoing is not intended to and shall not apply to (i) the intercompany Indebtedness owing from MWG to Edison Mission Overseas or from Edison Mission Overseas to EMMH as in existence on the Effective Date or as the same may be modified to take into account or \"mirror\" any Permitted Refinancing Indebtedness or (ii) the cash collateralized letter of credit facility contemplated by Section 5.01(d). 5.08 Separateness.",
"The Guarantor will, and will cause its Subsidiaries to and will use reasonable efforts to cause its Joint Enterprises (to the extent consistent with its obligations to other members of such Joint Enterprise) to, not (other than in connection with the cash collateralized letter of credit facility contemplated by Section 5.01(d)): (a) hold itself out as having agreed to pay or become liable for any Indebtedness of EME; (b) fail to correct any known or reasonably knowable misrepresentation with respect to clause (a) of this Section 5.08; (c) fail to correct any known or reasonably knowable misrepresentation with respect to EME holding itself out as having agreed to pay or become liable for any Indebtedness of the Guarantor; (d) operate or purport to operate as an integrated, single economic unit with respect to EME or any other Affiliated or unaffiliated entity; (e) seek or obtain credit, incur any obligation or any Indebtedness to any third party based upon the assets of EME; -------------------------------------------------------------------------------- (f) induce any such third party to reasonably rely on the creditworthiness of EME or any other Affiliated or unaffiliated entity in connection with any obligation or any Indebtedness of the Guarantor; and (g) allow EME to guarantee any of the obligations of the Guarantor. The foregoing is qualified in its entirety by the following: EME owes MWG approximately $1,365,000 in the aggregate pursuant to promissory notes dated as of August 24, 2000 and EME guarantees payment of the obligations of MWG under and has certain tax indemnity obligations with respect to the lease relating to its Powerton and Joliet units dated as of August 17, 2000.",
"These obligations may be modified in connection with Permitted Refinancing Indebtedness and may otherwise be modified from time to time in the manner permitted under the documentation governing such obligations. In addition, EME guarantees payments due under the lease of the office premises occupied by the Guarantor. 5.09 ERISA. The Guarantor will and will cause its Subsidiaries to, not engage in any prohibited transactions under Section 406 of ERISA or under Section 4975 of the Code, which would subject the Guarantor to any tax, penalty or other liabilities having a Material Adverse Effect. Section 6. Miscellaneous. 6.01 Notices.",
"All notices, requests, consents and demands hereunder shall be in writing and telecopied or delivered to the intended recipient at the \"Address for Notices\" specified beneath its name on the signature pages hereto or, as to either party, at such other address as shall be designated by such party in a notice to each other party. Except as otherwise provided in this Agreement, all such communications shall be deemed to have been duly given when transmitted by telecopier or personally delivered or, in the case of a mailed notice, upon receipt, in each case given or addressed as aforesaid. 6.02 No Waiver. No failure on the part of the Administrative Agent or any Lender to exercise, and no course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Administrative Agent or any Lender of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy.",
"The remedies herein are cumulative and are not exclusive of any remedies provided by law. 6.03 Amendments, Etc. The terms of this Agreement may be waived, altered or amended only by an instrument in writing duly executed by the Guarantor and the Administrative Agent (with the consent of the Lenders as specified in Section 10.1 of the Credit Agreement). Any such amendment or waiver shall be binding upon the Administrative Agent and each Lender, each holder of any of the Guaranteed Obligations and the Guarantor. 6.04 Expenses. The Guarantor agrees to reimburse each of the Lenders and the Administrative Agent for all reasonable costs and expenses of the Lenders and the Administrative Agent (including, without limitation, the reasonable fees and expenses of legal counsel) in connection with (a) any Default and any enforcement or collection proceeding resulting therefrom, including, without limitation, all manner of participation in or other involvement with (i) bankruptcy, insolvency, receivership, foreclosure, winding up or liquidation proceedings, (ii) judicial or regulatory proceedings and (iii) workout, restructuring or other negotiations or proceedings (whether or not the workout, restructuring or transaction contemplated thereby is consummated) and (b) the enforcement of this Section 6.04.",
"6.05 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of the Guarantor, the Administrative Agent, the Lenders and each holder of any of the Guaranteed Obligations (provided, however, that the Guarantor shall not assign or transfer its rights or obligations hereunder without the prior written consent of the Administrative Agent). -------------------------------------------------------------------------------- 6.06 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and either of the parties hereto may execute this Agreement by signing any such counterpart.",
"6.07 Governing Law; Submission to Jurisdiction. This Agreement shall be governed by, and construed in accordance with, the law of the State of New York. The Guarantor hereby submits to the non exclusive jurisdiction of the United States District Court for the Southern District of New York and of the Supreme Court of the State of New York sitting in New York County (including its Appellate Division) and of any other appellate court in the State of New York for the purposes of all legal proceedings arising out of or relating to this Agreement or the transactions contemplated hereby.",
"The Guarantor hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of the venue of any such proceeding brought in such a court and any claim that any such proceeding brought in such a court has been brought in an inconvenient forum. 6.08 Waiver of Jury Trial. EACH OF THE GUARANTOR, THE ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 6.09 Captions.",
"The captions and section headings appearing herein are included solely for convenience of reference and are not intended to affect the interpretation of any provision of this Agreement. -------------------------------------------------------------------------------- IN WITNESS WHEREOF, the parties hereto have caused this Primary Guarantee to be duly executed and delivered as of the day and year first above written. MIDWEST GENERATION EME, LLC By: /s/ MARIA P. LITOS -------------------------------------------------------------------------------- Name: Maria P. Litos Title: Vice President and Assistant Secretary Address for Notices: [Signature Page to Midwest Generation EME LLC Primary Guarantee] -------------------------------------------------------------------------------- CITICORP NORTH AMERICA, INC, as Administrative Agent By: /s/ DALE R. GONCHER -------------------------------------------------------------------------------- Name: Dale R. Goncher Title: Vice President [Signature Page to Midwest Generation EME LLC Primary Guarantee] -------------------------------------------------------------------------------- ANNEX A \"Administrative Agent\" means Citicorp North America, Inc., in its capacity as administrative agent for the Lenders hereunder, and includes each other Person as may have subsequently been appointed as the successor Administrative Agent pursuant to Section 9.4 of the Credit Agreement. \"Affiliate\" of any Person means any other Person which, directly or indirectly, controls, is controlled by or is under common control with such Person (excluding any trustee under, or any committee with responsibility for administering, any Pension Plan or Welfare Plan). A Person shall be deemed to be \"controlled by\" any other Person if such other Person possesses, directly or indirectly, power to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.",
"\"Agreement\" means, on any date, this Guarantee as originally in effect on the Effective Date and as thereafter from time to time amended, supplemented, amended and restated or otherwise modified and in effect on such date. \"Board of Directors\" means, (a) with respect to a corporation, the board of directors of the corporation, (b) with respect to a partnership, the general partners or the management committee of the partnership or (c) with respect to any other Person, the board or committee of such Person serving a similar function.",
"\"Borrower\" means Mission Energy Holdings International, Inc., a Delaware corporation. \"BV Holdings Guarantees\" mean this Agreement and the other \"Guarantees\", in effect from time to time, as such meaning is set forth in the Credit Agreement. \"BV Holdings Guarantors\" means the Guarantor hereunder and the other \"Guarantors\", as such meaning is set forth in the Credit Agreement. \"Capitalized Lease Liabilities\" of any Person means all monetary obligations of such Person under any leasing or similar arrangement which, in accordance with GAAP, would be classified as capitalized leases, and, for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP. \"Cash Equivalent Investment\" means, at any time: (a) any evidence of Indebtedness, maturing not more than one year after such time, issued or guaranteed by the United States government or an agency thereof; or (b) other investments in securities or bank instruments rated at least \"A\" by S&P and \"A2\" by Moody's or \"A-1\" by S&P and \"P-1\" by Moody's and with maturities of less than 180 days. \"CERCLIS\" means the Comprehensive Environmental Response Compensation Liability Information System List.",
"\"Code\" means the Internal Revenue Code of 1986, as amended. \"Collins Holdings\" means Collings Holdings EME LLC, a Delaware limited liability company. \"Contingent Liability\" means any agreement, undertaking or arrangement by which any Person guarantees, endorses or otherwise becomes or is contingently liable upon (by direct or indirect agreement, contingent or otherwise, to provide funds for payment, to supply funds to, or otherwise to invest in, a debtor, or otherwise to assure a creditor against loss) the indebtedness, obligation or any other liability of any other Person (other than by endorsements of instruments in the course of collection), or guarantees the payment of dividends or other distributions upon the shares of any other Person. The amount of any Person's obligation under any Contingent Liability shall (subject to any limitation set forth therein) be deemed to be the outstanding principal amount of the debt, obligation or other liability guaranteed thereby; provided, however, that if the maximum amount of the debt, obligation or other liability guaranteed thereby has not been established, the amount of such Contingent Liability shall be the maximum reasonably anticipated amount of the debt, obligation or -------------------------------------------------------------------------------- other liability; provided, further, however, that any agreement to limit the maximum amount of such Person's obligation under such Contingent Liability shall not, of and by itself, be deemed to establish the maximum reasonably anticipated amount of such debt, obligation or other liability. \"Contractual Obligation\" means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.",
"\"Contractual Restrictions\" mean Contractual Obligations of the Guarantor or any of its Subsidiaries limiting or restricting any of the following activities of the Guarantor or any of its Subsidiaries: (a) Restricted Payments, (b) the repayment or prepayment of intercompany notes or other intercompany obligations or reimbursements of management and other intercompany charges, expenses or accruals or other returns on investment, (c) Disposition (as defined in the Credit Agreement), (d) Debt Incurrence (as defined in the Credit Agreement), (e) Equity Issuance (as defined in the Credit Agreement) or (f) activities related to the foregoing. \"Controlled Group\" means all members of a controlled group of corporations and all members of a controlled group of trades or businesses (whether or not incorporated) under common control which, together with the Guarantor, are treated as a single employer under Section 414(b) or 414(c) of the Code or Section 4001 of ERISA.",
"\"Correlative Financing Provisions\" means (i) with respect to each Financed Enterprise with respect to any provision in Section 5, the most restrictive correlative provision or provisions in the Effective Date Financing Documentation or in the documentation governing any Permitted Refinancing Indebtedness refinancing or replacing such Effective Date Financing Documentation and (ii) with respect to each Financed Enterprise with respect to any other provision (other than any provision in Section 5) in this Guarantee, the most restrictive correlative provision or provisions in the Effective Date Financing Documentation or in the documentation governing any Permitted Refinancing Indebtedness refinancing or replacing such Effective Date Financing Documentation, as the same may from time to time be amended, supplemented, amended and restated or otherwise modified and in effect on such date.",
"\"Credit Agreement\" means the Credit Agreement dated as of December 11, 2003 among the Borrower, the Lenders and the Administrative Agent. \"Debt Rating\" means, with respect to any Person, a rating of such Person's long-term debt which is not secured or supported by a guarantee, letter of credit or other form of credit enhancement. If Moody's or S&P shall have changed its system of classifications after the date hereof, a Debt Rating shall be considered to be at or above a specified level if it is at or above the new rating which most closely corresponds to the specified level under the old rating system. \"Default\" has the meaning set forth in the Credit Agreement.",
"\"Disposition\" means any sale, assignment, transfer or other disposition of any property (whether now owned or hereafter acquired) by the Guarantor or any of its Subsidiaries or any of its Joint Enterprises to any other Person. The verb \"Dispose\" shall have a correlative meaning. Notwithstanding the preceding, the following items shall not be deemed to be Dispositions: (a) any assignment of property for security purposes to the extent not prohibited by this Agreement or, in the case of any Financed Enterprise, any Correlative Financing Provisions; (b) any sale, assignment, transfer or other disposition of any property sold or disposed of in the ordinary course of business and on ordinary business terms; (c) any single transaction or series or related transactions that involves assets having a fair market value of less than $15,000,000; A-2 -------------------------------------------------------------------------------- (d) the sale or other disposition of cash or Cash Equivalent Investments; (e) the incurrence of Liens permitted pursuant to Section 5.02 and the disposition of assets related thereto by the secured party pursuant to a foreclosure; (f) a Restricted Payment that is permitted pursuant to Section 5.06 or an Investment that is permitted pursuant to Section 5.03; (g) any sale or lease of obsolete equipment or other assets that are no longer being used by the Borrower or any of its Subsidiaries; and (h) a disposition resulting from the exercise by a governmental authority of its claimed or actual power of eminent domain, in each case without compensation.",
"\"Dollar\" and the sign \"$\" mean lawful money of the United States. \"Edison International\" means Edison International, a California corporation. \"Edison Mission Overseas\" means Edison Mission Overseas Co., a Delaware corporation. \"Effective Date\" means the date the Credit Agreement becomes effective pursuant to Section 5.1 of the Credit Agreement. \"Effective Date Financing Documentation\" means, with respect to each Financed Enterprise, documentation governing each Financing of such Financed Enterprise as in effect on the Effective Date, copies of which have heretofore been furnished to the Administrative Agent. \"EME\" means Edison Mission Energy, a Delaware corporation. \"EMMH\" means Edison Mission Midwest Holdings Co., a Delaware corporation.",
"\"Environmental Laws\" means all applicable federal, state or local statutes, laws, ordinances, codes, rules, regulations and guidelines (including consent decrees and administrative orders) relating to Hazardous Materials and/or to public health and protection of the environment, including the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, and the Resource Conservation and Recovery Act, as amended. \"ERISA\" means the Employee Retirement Income Security Act of 1974, as amended, and any successor statute of similar import, together with the regulations thereunder, in each case as in effect from time to time. References to sections of ERISA also refer to any successor sections. \"Event of Default\" has the meaning set forth in Section 8.1 of the Credit Agreement. \"Excess Funding Guarantor\" has the meaning set forth in Section 2.10.",
"\"Excess Payment\" has the meaning set forth in Section 2.10. \"Financed Subsidiary\" means as of the Effective Date, MWG, EMMH, Collins Holdings and Edison Mission Overseas. \"Financed Enterprise\" means, individually, each Financed Subsidiary and each Joint Enterprise. \"Financing\" means, with respect to any Person, either Indebtedness of such Person or Lease Obligations of such Person, or a combination of both. \"GAAP\" means generally accepted accounting principles in effect in the United States. \"Governmental Approval\" has the meaning set forth in Section 3.3. \"Guarantor\" has the meaning set forth in the recitals of this Agreement. \"Guaranteed Obligations\" has the meaning set forth is Section 2.09. A-3 -------------------------------------------------------------------------------- \"Hazardous Material\" means: (a) any \"hazardous substance\", as defined by any Environmental Law; (b) any \"hazardous waste\", as defined by any Environmental Law; (c) any petroleum product; or (d) any pollutant or contaminant or hazardous, dangerous or toxic chemical, material or substance within the meaning of any Environmental Law. \"herein\", \"hereof\", \"hereto\", \"hereunder\" and similar terms contained in this Agreement refer to this Agreement as a whole and not to any particular Section, paragraph or provision of this Agreement.",
"\"including\" means including without limiting the generality of any description preceding such term, and, for purposes of this Agreement, the parties thereto agree that the rule of ejusdem generis shall not be applicable to limit a general statement, which is followed by or referable to an enumeration of specific matters, to matters similar to the matters specifically mentioned. \"Indebtedness\" of any Person means, without duplication: (a) all indebtedness for borrowed money; (b) all obligations issued, undertaken or assumed as the deferred purchase price of property or services which purchase price is due more than six months from the date of incurrence of the obligation in respect thereof or is evidenced by a note or other instrument, except trade accounts arising in the ordinary course of business; (c) all reimbursement obligations with respect to surety bonds, letters of credit (to the extent not collateralized with cash or Cash Equivalent Investments), bankers' acceptances and similar instruments (in each case, whether or not matured); (d) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses; (e) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to property acquired by the Person (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property); (f) all Capitalized Lease Liabilities; (g) all net obligations with respect to sales of foreign exchange options; (h) all indebtedness referred to in clauses (a) through (g) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property (including accounts and contracts rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness; and (i) all Contingent Liabilities.",
"For all purposes of this Agreement, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer. \"Investment\" means, relative to any Person: (a) any loan or advance made by such Person to any other Person (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business); (b) any Contingent Liability of such Person; and A-4 -------------------------------------------------------------------------------- (c) any ownership or similar interest held by such Person in any other Person. The amount of any Investment shall be the original principal or capital amount thereof less all returns of principal or equity thereon (and without adjustment by reason of the financial condition of such other Person) and shall, if made by the transfer or exchange of property other than cash, be deemed to have been made in an original principal or capital amount equal to the fair market value of such property. \"Joint Enterprise\" means a general partnership, limited partnership, joint venture or similar entity in which the Guarantor or a Subsidiary is a partner, joint venturer or equity participant.",
"The term \"Joint Enterprise\" shall exclude, to the extent included, partnerships or other business entities included in the definition of \"Subsidiary\". \"Lease Obligations\" means rent, supplemental rent, termination value, or a similar monetary obligation under, or pursuant to, a lease or related documents in connection with a leveraged lease transaction (including Contingent Liabilities related thereto). \"Lenders\" has the meaning set forth in the Credit Agreement. \"Lien\" means any security interest, mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or otherwise), charge against or interest in property, in each case of any kind, to secure payment of a debt or performance of an obligation. \"Loan\" has the meaning set forth in Section 2.1 of the Credit Agreement. \"Loan Documents\" has the meaning set forth in the Credit Agreement.",
"\"Material Adverse Effect\" means any event, development or circumstance that has had or would reasonably be expected to have a material adverse effect on (a) the business, assets, property, condition (financial or otherwise) or operations of the Guarantor and its Subsidiaries, taken as a whole since the Effective Date, or (b) the ability of the Guarantor to perform its obligations under this Agreement. \"Moody's\" means Moody's Investors Service, a division of Dun & Bradstreet Corporation, and its successors and assigns. \"MWG\" means Midwest Generation LLC, a Delaware limited liability company. \"Net After-Tax Cash Proceeds\" has the meaning set forth in the Credit Agreement. \"Operating Subsidiary\" means any Subsidiary whose activities include significant commercial activities, other than holding the equity or debt of another Person. \"Organic Document\" means, with respect to any Person that is a corporation, its certificate of incorporation, its by-laws and all shareholder agreements, voting trusts and similar arrangements applicable to any of its authorized shares of capital stock; and, with respect to any Person that is a limited liability company, its certificate of formation and its limited liability agreement, in each case, as from time to time amended, supplemented, amended and restated, or otherwise modified and in effect from time to time.",
"\"Pension Plan\" means a \"pension plan\", as such term is defined in Section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer plan as defined in Section 4001(a)(3) of ERISA), and to which the Borrower or any corporation, trade or business that is, along with the Guarantor, a member of a Controlled Group, has any liability, including any liability by reason of having been a substantial employer within the meaning of Section 4063 of ERISA at any time during the preceding five years, or by reason of being deemed to be a contributing sponsor under Section 4069 of ERISA. A-5 -------------------------------------------------------------------------------- \"Permitted Contractual Restrictions\" means (a) Contractual Restrictions in effect on the Effective Date (including Contractual Restrictions contained in charter documents of any Person on the Effective Date) and (b) Contractual Restrictions in effect after the Effective Date arising out of Permitted Refinancing Indebtedness incurred by the Borrower and its Subsidiaries (so long as such Contractual Restrictions relate solely to the borrower and its subsidiaries (or any of the Guarantor or its Subsidiaries that are guarantors, pledgors or other collateral providers in connection such Permitted Refinancing Indebtedness and their respective Subsidiaries)). \"Permitted EME Intercompany Indebtedness\" means intercompany Indebtedness of the Guarantor and/or Subsidiaries of the Guarantor issued or incurred to EME directly arising out of or in connection with (a) intercompany Indebtedness for working capital, (b) Indebtedness in connection with hedging obligations of Guarantor and/or its Subsidiaries in connection with their operations and (c) Indebtedness incurred in connection with letters of credit obtained in the support of trading activities of the Guarantor and/or it Subsidiaries.",
"\"Permitted Intercompany Indebtedness\" means intercompany indebtedness between the Guarantor and Subsidiaries of the Guarantor or between Subsidiaries of the Guarantor directly arising out of or in connection with (a) Restricted Payments intended ultimately to be received by the Guarantor, (b) intercompany indebtedness for working capital, (c) Indebtedness incurred in the ordinary course of business, (d) additional Indebtedness incurred after the Effective Date consisting of: (i) intercompany loans evidenced by intercompany notes between the Guarantor and its Subsidiaries; (ii) hedging obligations of Guarantor and/or its Subsidiaries in connection with their operations; and (iii) letters of credit obtained in the support of trading activities of the Guarantor and/or it Subsidiaries and (e) Investments by the Guarantor or the Subsidiaries of the Guarantor in Subsidiaries of the Guarantor; provided, that no Material Adverse Effect would reasonably be expected to occur as a result of the incurrence of such intercompany Indebtedness.",
"\"Permitted Refinancing Indebtedness\" means, with respect to any Person, any refinancing of a Financing of such Person (or a related Financed Enterprise as set forth in the proviso below) issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund (collectively, \"refinance\") other Financings of such Person (or a related Financed Enterprise as set forth in the proviso below); provided, that (a) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the aggregate principal amount (or accreted value or termination value, if applicable) of the Financing being refinanced (plus all accrued interest thereon and the amount of all expenses and premiums in connection therewith) unless a corresponding payment is made in accordance with Section 3.1.2(a)(viii) of the Credit Agreement, (b) the maturity date of the Permitted Refinancing Indebtedness is no earlier than the maturity date of the Financing being refinanced and such Permitted Refinancing Indebtedness has a weighted average life to maturity equal to or greater than the weighted average life to maturity of the Financing being refinanced, provided, that for purposes of this provision and clause (d) below, the maturity of the Lease Obligations related to the Collins facility shall be deemed to be December 8, 2004, (c) subject to clause (d) below, any Contractual Restrictions incurred in connection with such Permitted Refinancing Indebtedness are (as determined in good faith by the Borrower's Board of Directors, the determination of which shall be evidenced by a resolution of such Board of Directors) no more restrictive on such Person or its Subsidiaries or Affiliates than the Financing being refinanced taken as a whole and (d) with respect to any refinancings within 12 months of the maturity date of such Financing, such Permitted Refinancing Indebtedness may contain Contractual Restrictions that are in the written opinion of the Borrower's chief executive officer or chief financial officer required by the lenders in order to obtain such refinancings, are customary for such refinancings and apply only to the assets of or revenues of the Person which is the subject of the refinancing, provided that for purposes of this provision, the maturity of the Lease Obligations related to the Collins facility shall be deemed to be December 8, 2004; provided that, a Financing of one Financed Enterprise may be refinanced by A-6 -------------------------------------------------------------------------------- another Financed Enterprise or who shall be deemed to be a Financed Enterprise for purposes of this definition.",
"\"Person\" means any natural person, corporation, partnership, limited liability company, firm, association, trust, government, governmental agency or any other entity, whether acting in an individual, fiduciary or other capacity. \"Pro Rata Share\" has the meaning set forth in Section 2.10. \"Relevant Public Filings\" means public filings of EME and Midwest Generation LLC with the Securities and Exchange Commission prior to the Effective Date \"Restricted Payment\" means any dividend on, or any payment on account of, or setting apart assets for a sinking or other analogous fund for, the purchase, redemption, defeasance, retirement or other acquisition of, any shares of any class of capital stock of or other ownership interest or any warrants or options to purchase any such stock or ownership interest, whether now or hereafter outstanding, or making of any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of the Person making such dividend or payment.",
"\"S&P\" means Standard & Poor's Ratings Services and its successors and assigns. \"Security Documents\" has the meaning set forth in the Credit Agreement. \"Subsidiary\" means, with respect to any Person: (a) any corporation, association or other business entity of which more than 50% of the outstanding capital stock having ordinary voting power to elect a majority of the directors, managers or trustees of such corporation (irrespective of whether at the time capital stock of any other class or classes of such corporation shall or might have voting power upon the occurrence of any contingency) is at the time directly or indirectly owned by such Person, by such Person and one or more other Subsidiaries of such Person, or by one or more other Subsidiaries of such Person; and (b) any partnership (i) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (ii) the only general partners of which are such Person or one or more Subsidiaries of such Person (or any combination thereof). \"United States\" or \"U.S.\" means the United States of America, its fifty States and the District of Columbia.",
"\"Welfare Plan\" means a \"welfare plan\", as such term is defined in Section 3(1) of ERISA. A-7 -------------------------------------------------------------------------------- SCHEDULE 3.08(a) 1.UCC-1 dated October 19, 2001, in favor of First Access covering One Toyota 7FGU30, S/N 62257, 159 FSV, Gas Powered, Dual Hosting Smart Alarm, Side Shifter 48 inch Forrs. 2.UCC-1 dated March 10, 03 in favor of First Access covering one Toyota 6FGU30 S/N 60749, 171 TSU 3.UCC-1 dated April 8, 2003 in favor of First Access covering used Toyota Forklift Model 02-6FGU30 S/N: 60749 4.UCC-1 dated April 9, 2003 in favor of Comark Capital Leasing Services covering office equipment, now or hereafter leased to and/or financed for debtor/lessee by secured party/lessor, and including all replacements, upgrades and substitutions hereafter occurring to all of the foregoing equipment and all now existing and future attachments, parts, accessories and add-ons for all of the foregoing items and types of equipment, and all proceeds and products thereof. A-8 -------------------------------------------------------------------------------- Midwest Generation EME LLC Indebtedness At November 30, 2003 Schedule 5.01 to the Guarantee Principal -------------------------------------------------------------------------------- Interest -------------------------------------------------------------------------------- Total -------------------------------------------------------------------------------- (Rounded to nearest thousand) Due to Shareholders: Interco Loan-Edison Mission Energy $ 48,640,000 $ 2,420,330 $ 51,060,330 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Total Intercompany Loans $ 48,640,000 $ 2,420,330 $ 51,060,330 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- A-9 --------------------------------------------------------------------------------"
] | https://github.com/TheAtticusProject/cuad | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
|
FORD, District Judge. On January 13, 1948, this court on petition of the trustee in reorganization of the Boston & Providence Railroad Corporation entered an order fixing February 5, 1948 for a hearing of all parties in interest in support of and in opposition to the plan of reorganization, together with their claims for equitable treatment, approved by the Interstate Commerce Commission by its third supplemental report and order under date of July 13, 1943 and certified to this court in January of 1944. *186Objections to the plan, within the time appointed by the court, were filed by the trustee in reorganization of the Boston & Providence Railroad Corporation; the trustee of the Boston Terminal Company, debtor in reorganization, and the Webster and Atlas National Bank of Boston, trustee under an indenture dated July 29, 1896 securing the first mortgage bonds of the Boston Terminal Company (joined in by the Mutual Savings Bank Group Committee for the Boston Terminal Company bonds and Institutional Group for Boston Terminal Company bonds); Frederic C. Dumaine, owner and holder of $2,000,000 principal amount of the $2,170,000 registered Fifteen Year 5% Gold Debenture Bonds of the debtor; Stockholders Committee of the debtor, and the debtor. Paragraph 1 of the plan provides that upon the consummation of the reorganization of the New York, New Haven and Hartford Railroad Company, and upon payment of the purchase price as specified in paragraph 3 of the plan, the debtor, or its trustees, shall convey to the New Haven all of its assets and property of every nature and description. Paragraph 3 of the plan specifies as the purchase price the delivery to the debtor of securities of the New Haven in the following amounts, to wit, $3,039,213 of its first and refunding bonds, $1,467,520 of its income bonds, and $1,467,520 of its preferred stock.1 Also included in the consideration is the assumption and payment by the New Haven (subject to the limitation concerning the Boston Terminal Company in paragraph 3) of the debtor’s reorganization expenses, current liabilities of the debtor incurred prior to institution of reorganization proceedings which are entitled to priority over its debentures, current liabilities of debtor’s trustees; all taxes and all other claims, allowed by the date of confirmation of the debtor’s plan, which rank senior to debtor’s debentures. Paragraph 4 provides that all claims held by the New Haven, or its trustees, or the Old Colony and its trustees, against the debtor and all claims held by the debtor against the New Haven or Old Colony are to be immediately discharged. Paragraphs 5 and 6 of the plan provide as follows: 5. There shall be allotted to the holder or holders of Boston & Providence Railroad Corporation debentures New York, New Haven & Hartford Railroad Company first and refunding mortgage 4-per-cent bonds in a principal amount equal to the principal amount of such debentures and accrued interest thereon to the date of the consummation of the plan, after crediting to such interest the cash formerly in the sinking fund and now held by the Boston & Providence Railroad Corporation trustees. In the event that any claims not assumed by the New York, New Haven & Hartford Railroad Company and ranking equally with the Boston & Providence Railroad Corporation debentures have been allowed by the court prior to the date of the consummation of the plan, holders of such claims also shall be allotted New York, New Haven & Hartford Railroad Company first and refunding mortgage 4-percent bonds in a principal amount equal to the aggregate amount of such claims. 6. There shall be distributed pro rata among the holders of Boston & Providence Railroad Corporation capital stock, exclusive of the stock formerly in the sinking fund, the remainder of the New York, New Haven & Hartford Railroad Company securities received by the Boston & Providence Railroad Corporation trustees. In the event that any claims subordinate to the Boston & Providence Railroad Corporation’s debentures are allowed by the court, the matter of the reallocation of the securities herein allotted to the Boston & Providence Railroad Corporation’s stockholders shall by appropriate action then be brought before us. It is clear that the plan does not provide for the issuance of sufficient first and refunded 4% mortgage bonds of the New York, New Haven and Hartford Railroad to meet the requirements of paragraph *1875 of the plan as will be seen from the following tabulation: Face amount of Boston & Providence debentures $2,170,000.00 Accrued interest to Jan. 1, 1948 1,085,000.00 Total $3,255,000.00 Sinking fund 75,615.13 Fixed interest bonds required for debentures $3,179,384.87 Fixed interest bonds available 3,039,213.00 Insufficiency of fixed interest bonds $ 140,171.87 Thus it is seen at the outset that the plan does not provide adequate means for its execution, Section 77, sub. b(5) of the Bankruptcy Act, 11 U.S.C.A. § 205, sub. b (5), and must be referred back to the Interstate Commerce Commission for further action. There are other reasons, in this court’s opinion, why the plan should be disapproved. Paragraph 2 of the plan provides as follows: 2. The Boston & Providence Railroad Corporation’s charter shall be amended, and its franchises and statutory obligations shall be amended or superseded, so that (a) the New York, New Haven & Hartford Railroad Company and the Boston & Providence Railroad Corporation shall be relieved of any obligation to continue to use the property of the Boston Terminal Company, and of any obligation to make any payments for such use, if and when such use shall be discontinued; (b) the obligations of new York, New Haven & Hartford Railroad Company and the Boston & Providence Railroad Corporation and their trustees to make payments on account of interest and principal (at maturity or otherwise, including any deficiency on foreclosure or any other claim with respect thereto) of the debt of the Boston Terminal Company represented by its presently outstanding bonds (or any extensions, renewals or refunding thereof) after the date on which the New York, New Haven & Hartford Railroad Company trustees have made the last payments on account of interest on said bonds, shall, so long as the New York, New Haven & Hartford Railroad Company (for itself, as operator of the Boston group of the Old Colony, and as operator of the Boston & Providence Railroad Corporation) shall use the property of the Boston Terminal Company, be satisfied by payment by the New York, New Haven & Hartford Railroad Company of an amount per annum (and at that rate for any period of less than a year) obtained by applying to $275,000 the percentage of the total use of such property from time to time by the New York, New Haven & Hartford Railroad Company (including in such percentage prior to the consummation of the plan, use by its trustees for itself and as operators of the Old Colony, and as operator of the Boston & Providence Railroad Corporation); and (c) the obligation to pay operating expenses shall be limited to the amount of such expenses after deducting all revenues from rentals and concessions. If the number of passengers using the South Station of the Boston Terminal Company shall substantially increase in the future, this Commission will consider an application by any bondholders of the Terminal Company to make an equitable revision of the amount payable by the New York, New Haven & Hartford Railroad Company. This provision is similiar to Section N (1) (a) of the New Haven plan. (257 I.C. C. 9). If the plan of the debtor should become effective and the provisions of paragraph 2 were absolute in their terms, they would have the effect of (1) reducing the administration claim of Terminal for use of Terminal and its facilities during bankruptcy proceedings; (2) reducing compensation to be paid after reorganization for use of Terminal in the future; and (3) depriving Terminal of its outside revenue. Also, paragraph 2 undertakes to abrogate the obligations of the debtor, Section 4 of the Massachusetts Act establishing the Terminal Company, Acts 1896, c. 516, to bondholders of Terminal for its share of any deficiency upon foreclosure of mortgage. This claim runs directly to the bondholders *188or their mortgage trustee. (Old Colony-Bondholders v. New York, N. H. & H. R. Co., 2 Cir., 161 F.2d 413, 424). These provisions concededly are illegal in the form in which they appear in the debtor’s plan. The plan cannot compel Terminal to accept these terms (In re New York, N. H. & H. R. Co., 2 Cir., 147 F.2d 40, 52) nor can it wipe out the right of bondholders under the Massachusetts statute. Judge Hincks, construing Section N(l) (a) of the New Haven plan ( In re New York, N. H. § H. R. Co., D.C., 54 F.Supp. 595, 623, December 21, 1943), recognized the defect with respect to the impairment of Terminal’s claim and construed these provisions relieving the new Haven with respect to Terminal’s administration claim and compensation for use after reorganization as an offer to Terminal which the latter was free to reje.ct or accept after submission. Judge Hincks stated at page 623 of 54 F.Supp. that the acceptance of the offer would, in addition, waive its damage claim for abrogating the use of Terminal. This construction was adopted by the Commission and in its fifth supplemental report and order on the New Haven plan (February 8, 1944, 257 I.C.C. 9), the Commission added paragraph (1) (b) to the New Haven plan giving the trustee of Terminal the right to elect whether to exclude the using railroads from further occupation and use and file a proof of claim for damages or accept the terms of the offer and waive all claims for damages arising from the rejection and all claims for compensation for use of its property. With this addition to the plan the provisions referred to were held to be legal by the Second Circuit Court in 147 F.2d 40, 51, supra, January 2, 1945. In the New Haven proceedings, the offer included in Section N(l) (b) of the New Haven plan was submitted by order of the Commission to the trustee of Terminal July 24, 1947 and rejected after hearing by order of the court on August 21, 1947. Claim for damages have been filed by Terminal in the proceedings at New Haven. As stated above, the debtor’s plan in these proceedings was certified to this court in January, 1944, about six months after the Commission’s third supplemental report and order of July 13, 1943. No further supplemental report and order has been made in these proceedings and the provisions of the plan are in the same form as the corresponding provision in the New Haven plan before the amendment of February 8, 1944 adding paragraph (1) (b) to the plan. The plan as it stands is illegal unless I have the power' to construe the plan differently than its language plainly states and virtually rewrite it with respect to paragraph 2 by adding to the plan a section comparable'in terms to Section N(i) (b) in the New Haven plan. Section N(l) (b) had been added when the court passed upon the validity of the plan in 2 Cir., 161 F.2d 413, supra. That I have this power is open, to say the least, to grave doubt. The Supreme Court in Ecker v. Western Pacific Railroad Corporation, 318 U.S. 448, 474, 63 S.Ct. 692, 708, 87 L.Ed. 892, stated that “the district court acts concerning the plans only upon the issues specifically delegated by subsection (e). As to these, its powers are negative. It may veto the plan in its entirety but may improve it only by suggestion.” (Emphasis supplied). It seems to this court that if it were to add' in the debtor’s plan a provision similar to N(l) (b) of the New Haven, it would be doing something far removed from a suggestion in the light of the plain language of paragraph 2 as it now -stands and the probable understanding of the Commission that the provision was legal when it filed its third supplemental report and order and,, in all probability, before it had an opportunity to 'analyze the Connecticut court’s-, opinion in 54 F.Supp. 595, supra. If this court decided it had the power and construes paragraph 2 as an offer 2 to* *189Terminal in terms similar to Section N(l) (b) of the New Haven plan which, if accepted, would waive both its administration and damage claims and, if rejected, permit them to be proved, this procedure would not save the plan. If Terminal trustee rejects, there is no adequate provision to compensate Terminal for its claims in the plan, nor is there adequate provision to compensate for the claims of the bondholders. The latter claim for deficiency (the record in these proceedings shows there will be a deficiency) on the foreclosure of the Terminal mortgage could not be eliminated even if the trustee of Terminal accepted the offer (see Old Colony Bondholders v. New York, New Haven & Hartford Railroad Co., 2 Cir., 161 F.2d 413, 426). The court stated at page 425 of 161 F.2d: “Since the bondholders and Terminal’s reorganization trustee are unsecured creditors whose rights the plan proposes thus to modify, provision must be made to take care of their claims.” The abrogation claim of Terminal and the deficiency claim of bondholders are of equal rank with the debenture holders. These claims are not assumed by New Haven in the plan (par. 3(e)) and the administration claims are assumed subject to the limitation with respect to the Boston Terminal (par. 3). Terminal’s and the bondholder’s claims must be satisfied out of the 4% fixed interest bonds of New Haven paid for the debtor’s assets. Paragraph 5 of the plan specifically provides how claims of equal rank to the debentures shall be paid. That paragraph reads, in part, as follows: “In the event that any claims not assumed by the New York, New Haven and Hartford Railroad Company and ranking equally with the Boston and Providence Railroad Corporation debentures have been allowed by the court prior to the date of the consummation of the plan, holders of such claims also shall be allotted New York, New Haven and Hartford Railroad Company first and refunding mortgage 4-per-cent bonds in a principal amount equal to the aggregate of such claims.” To the extent these claims of Terminal and the bondholders are allowed, the insufficiency of the New Haven 4% bonds already shown with respect to the debenture holders of the debtor, would be materially increased. It is clear there are not sufficient 4% bonds of New Haven to satisfy the debentures and the damage and bondholders’ claims. And, if Terminal rejects the offer in paragraph 2 and proves its administration claim without limitation, how is that proportion of the administration claim which, in view of the limitation in paragraph 3, New Haven does not assume, to be paid ? There is no provision in the plan for it. Another provision in paragraph 5 should be noticed. It states that claims of equal rank to debentures of the debtor allowed prior to date of consummation will be entitled to participate in the 4-percents of New Haven. (Emphasis suggested). It may result that the claims of Terminal and the bondholders might not be allowed until long after consummation of the plan. There is no proviso to reserve New Haven fixed interest bonds- Ito satisfy claims proved after consummation of plan as there was of common stock to satisfy claims under Section J(17) of the New Haven plan. The effect of this would be that these claims, proved after confirmation, would not be provided for in the plan. In view of what has already been said, paragraph 6 of the plan is invalid. This paragraph of the plan contemplates distribution of securities to the debtor’s stockholders. With the deficiency of securities to provide for the debenture holders and the probability of claims being proved by Terminal and the bondholders of Terminal, this paragraph violates the priority rule of the Northern Pacific Railway Co. v. Boyd, 228 U.S. 482, 33 S.Ct. 554, 57 L. Ed. 931; Los Angeles Lumber Products Co., v. Case, 308 U.S. 106, 60 S.Ct. 1, 84 L.Ed. 110 and Consolidated Rock Co. v. Du Bois, 312 U.S. 510, 525, 61 S.Ct. 675, 85 L. Ed. 982 cases. “The important element is-the allocation of the securities so as to preserve to creditors the advantages of their respective priorities.” Ecker v. Western Pacific Railroad Corporation, supra, 318 U„ *190S. page 483, 63 S.Ct. page 712, 87 L.Ed. 892. For the conclusions and reasons above stated, the plan is not approved. On motion of the parties, it is Ordered that the proceedings-be referred back to the Com-mision for further action.
This was the precise offer made by New Haven and adopted by the Commission in its initial report and order of March 22, 1940. The Commission might consider in further proceedings whether any factors have arisen since 1940 that would affect the price to be paid for the debtor’s assets.
The offer by New Haven to acquire upon the accomplishment of the modification of debtor’s obligation to Terminal. If paragraph 2 is construed as the Boston & Providence is. conditioned an offer, in view of the limitation concerning the Boston Terminal Company in paragraph 3 of the plan, it is very doubtful that this alteration in the terms of the New Haven offer would be binding on the New Haven.* (See D.C., 54 * No one represented the New Haven at this hearing. F.Supp. 595, 618, and footnote page 622.) (Cf. 244 I.C.C. 247, at which time the-Commission required New Haven to pur*189chase Boston & Providence, provided, however that the plan of reorganization of the Boston & Providence is accepted and confirmed.) | 11-26-2022 | [
"FORD, District Judge. On January 13, 1948, this court on petition of the trustee in reorganization of the Boston & Providence Railroad Corporation entered an order fixing February 5, 1948 for a hearing of all parties in interest in support of and in opposition to the plan of reorganization, together with their claims for equitable treatment, approved by the Interstate Commerce Commission by its third supplemental report and order under date of July 13, 1943 and certified to this court in January of 1944. *186Objections to the plan, within the time appointed by the court, were filed by the trustee in reorganization of the Boston & Providence Railroad Corporation; the trustee of the Boston Terminal Company, debtor in reorganization, and the Webster and Atlas National Bank of Boston, trustee under an indenture dated July 29, 1896 securing the first mortgage bonds of the Boston Terminal Company (joined in by the Mutual Savings Bank Group Committee for the Boston Terminal Company bonds and Institutional Group for Boston Terminal Company bonds); Frederic C. Dumaine, owner and holder of $2,000,000 principal amount of the $2,170,000 registered Fifteen Year 5% Gold Debenture Bonds of the debtor; Stockholders Committee of the debtor, and the debtor. Paragraph 1 of the plan provides that upon the consummation of the reorganization of the New York, New Haven and Hartford Railroad Company, and upon payment of the purchase price as specified in paragraph 3 of the plan, the debtor, or its trustees, shall convey to the New Haven all of its assets and property of every nature and description. Paragraph 3 of the plan specifies as the purchase price the delivery to the debtor of securities of the New Haven in the following amounts, to wit, $3,039,213 of its first and refunding bonds, $1,467,520 of its income bonds, and $1,467,520 of its preferred stock.1 Also included in the consideration is the assumption and payment by the New Haven (subject to the limitation concerning the Boston Terminal Company in paragraph 3) of the debtor’s reorganization expenses, current liabilities of the debtor incurred prior to institution of reorganization proceedings which are entitled to priority over its debentures, current liabilities of debtor’s trustees; all taxes and all other claims, allowed by the date of confirmation of the debtor’s plan, which rank senior to debtor’s debentures.",
"Paragraph 4 provides that all claims held by the New Haven, or its trustees, or the Old Colony and its trustees, against the debtor and all claims held by the debtor against the New Haven or Old Colony are to be immediately discharged. Paragraphs 5 and 6 of the plan provide as follows: 5. There shall be allotted to the holder or holders of Boston & Providence Railroad Corporation debentures New York, New Haven & Hartford Railroad Company first and refunding mortgage 4-per-cent bonds in a principal amount equal to the principal amount of such debentures and accrued interest thereon to the date of the consummation of the plan, after crediting to such interest the cash formerly in the sinking fund and now held by the Boston & Providence Railroad Corporation trustees. In the event that any claims not assumed by the New York, New Haven & Hartford Railroad Company and ranking equally with the Boston & Providence Railroad Corporation debentures have been allowed by the court prior to the date of the consummation of the plan, holders of such claims also shall be allotted New York, New Haven & Hartford Railroad Company first and refunding mortgage 4-percent bonds in a principal amount equal to the aggregate amount of such claims.",
"6. There shall be distributed pro rata among the holders of Boston & Providence Railroad Corporation capital stock, exclusive of the stock formerly in the sinking fund, the remainder of the New York, New Haven & Hartford Railroad Company securities received by the Boston & Providence Railroad Corporation trustees. In the event that any claims subordinate to the Boston & Providence Railroad Corporation’s debentures are allowed by the court, the matter of the reallocation of the securities herein allotted to the Boston & Providence Railroad Corporation’s stockholders shall by appropriate action then be brought before us. It is clear that the plan does not provide for the issuance of sufficient first and refunded 4% mortgage bonds of the New York, New Haven and Hartford Railroad to meet the requirements of paragraph *1875 of the plan as will be seen from the following tabulation: Face amount of Boston & Providence debentures $2,170,000.00 Accrued interest to Jan. 1, 1948 1,085,000.00 Total $3,255,000.00 Sinking fund 75,615.13 Fixed interest bonds required for debentures $3,179,384.87 Fixed interest bonds available 3,039,213.00 Insufficiency of fixed interest bonds $ 140,171.87 Thus it is seen at the outset that the plan does not provide adequate means for its execution, Section 77, sub.",
"b(5) of the Bankruptcy Act, 11 U.S.C.A. § 205, sub. b (5), and must be referred back to the Interstate Commerce Commission for further action. There are other reasons, in this court’s opinion, why the plan should be disapproved. Paragraph 2 of the plan provides as follows: 2. The Boston & Providence Railroad Corporation’s charter shall be amended, and its franchises and statutory obligations shall be amended or superseded, so that (a) the New York, New Haven & Hartford Railroad Company and the Boston & Providence Railroad Corporation shall be relieved of any obligation to continue to use the property of the Boston Terminal Company, and of any obligation to make any payments for such use, if and when such use shall be discontinued; (b) the obligations of new York, New Haven & Hartford Railroad Company and the Boston & Providence Railroad Corporation and their trustees to make payments on account of interest and principal (at maturity or otherwise, including any deficiency on foreclosure or any other claim with respect thereto) of the debt of the Boston Terminal Company represented by its presently outstanding bonds (or any extensions, renewals or refunding thereof) after the date on which the New York, New Haven & Hartford Railroad Company trustees have made the last payments on account of interest on said bonds, shall, so long as the New York, New Haven & Hartford Railroad Company (for itself, as operator of the Boston group of the Old Colony, and as operator of the Boston & Providence Railroad Corporation) shall use the property of the Boston Terminal Company, be satisfied by payment by the New York, New Haven & Hartford Railroad Company of an amount per annum (and at that rate for any period of less than a year) obtained by applying to $275,000 the percentage of the total use of such property from time to time by the New York, New Haven & Hartford Railroad Company (including in such percentage prior to the consummation of the plan, use by its trustees for itself and as operators of the Old Colony, and as operator of the Boston & Providence Railroad Corporation); and (c) the obligation to pay operating expenses shall be limited to the amount of such expenses after deducting all revenues from rentals and concessions.",
"If the number of passengers using the South Station of the Boston Terminal Company shall substantially increase in the future, this Commission will consider an application by any bondholders of the Terminal Company to make an equitable revision of the amount payable by the New York, New Haven & Hartford Railroad Company. This provision is similiar to Section N (1) (a) of the New Haven plan. (257 I.C. C. 9). If the plan of the debtor should become effective and the provisions of paragraph 2 were absolute in their terms, they would have the effect of (1) reducing the administration claim of Terminal for use of Terminal and its facilities during bankruptcy proceedings; (2) reducing compensation to be paid after reorganization for use of Terminal in the future; and (3) depriving Terminal of its outside revenue.",
"Also, paragraph 2 undertakes to abrogate the obligations of the debtor, Section 4 of the Massachusetts Act establishing the Terminal Company, Acts 1896, c. 516, to bondholders of Terminal for its share of any deficiency upon foreclosure of mortgage. This claim runs directly to the bondholders *188or their mortgage trustee. (Old Colony-Bondholders v. New York, N. H. & H. R. Co., 2 Cir., 161 F.2d 413, 424). These provisions concededly are illegal in the form in which they appear in the debtor’s plan. The plan cannot compel Terminal to accept these terms (In re New York, N. H. & H. R. Co., 2 Cir., 147 F.2d 40, 52) nor can it wipe out the right of bondholders under the Massachusetts statute. Judge Hincks, construing Section N(l) (a) of the New Haven plan ( In re New York, N. H. § H. R. Co., D.C., 54 F.Supp. 595, 623, December 21, 1943), recognized the defect with respect to the impairment of Terminal’s claim and construed these provisions relieving the new Haven with respect to Terminal’s administration claim and compensation for use after reorganization as an offer to Terminal which the latter was free to reje.ct or accept after submission.",
"Judge Hincks stated at page 623 of 54 F.Supp. that the acceptance of the offer would, in addition, waive its damage claim for abrogating the use of Terminal. This construction was adopted by the Commission and in its fifth supplemental report and order on the New Haven plan (February 8, 1944, 257 I.C.C. 9), the Commission added paragraph (1) (b) to the New Haven plan giving the trustee of Terminal the right to elect whether to exclude the using railroads from further occupation and use and file a proof of claim for damages or accept the terms of the offer and waive all claims for damages arising from the rejection and all claims for compensation for use of its property. With this addition to the plan the provisions referred to were held to be legal by the Second Circuit Court in 147 F.2d 40, 51, supra, January 2, 1945. In the New Haven proceedings, the offer included in Section N(l) (b) of the New Haven plan was submitted by order of the Commission to the trustee of Terminal July 24, 1947 and rejected after hearing by order of the court on August 21, 1947.",
"Claim for damages have been filed by Terminal in the proceedings at New Haven. As stated above, the debtor’s plan in these proceedings was certified to this court in January, 1944, about six months after the Commission’s third supplemental report and order of July 13, 1943. No further supplemental report and order has been made in these proceedings and the provisions of the plan are in the same form as the corresponding provision in the New Haven plan before the amendment of February 8, 1944 adding paragraph (1) (b) to the plan. The plan as it stands is illegal unless I have the power' to construe the plan differently than its language plainly states and virtually rewrite it with respect to paragraph 2 by adding to the plan a section comparable'in terms to Section N(i) (b) in the New Haven plan. Section N(l) (b) had been added when the court passed upon the validity of the plan in 2 Cir., 161 F.2d 413, supra. That I have this power is open, to say the least, to grave doubt.",
"The Supreme Court in Ecker v. Western Pacific Railroad Corporation, 318 U.S. 448, 474, 63 S.Ct. 692, 708, 87 L.Ed. 892, stated that “the district court acts concerning the plans only upon the issues specifically delegated by subsection (e). As to these, its powers are negative. It may veto the plan in its entirety but may improve it only by suggestion.” (Emphasis supplied). It seems to this court that if it were to add' in the debtor’s plan a provision similar to N(l) (b) of the New Haven, it would be doing something far removed from a suggestion in the light of the plain language of paragraph 2 as it now -stands and the probable understanding of the Commission that the provision was legal when it filed its third supplemental report and order and,, in all probability, before it had an opportunity to 'analyze the Connecticut court’s-, opinion in 54 F.Supp. 595, supra.",
"If this court decided it had the power and construes paragraph 2 as an offer 2 to* *189Terminal in terms similar to Section N(l) (b) of the New Haven plan which, if accepted, would waive both its administration and damage claims and, if rejected, permit them to be proved, this procedure would not save the plan. If Terminal trustee rejects, there is no adequate provision to compensate Terminal for its claims in the plan, nor is there adequate provision to compensate for the claims of the bondholders. The latter claim for deficiency (the record in these proceedings shows there will be a deficiency) on the foreclosure of the Terminal mortgage could not be eliminated even if the trustee of Terminal accepted the offer (see Old Colony Bondholders v. New York, New Haven & Hartford Railroad Co., 2 Cir., 161 F.2d 413, 426). The court stated at page 425 of 161 F.2d: “Since the bondholders and Terminal’s reorganization trustee are unsecured creditors whose rights the plan proposes thus to modify, provision must be made to take care of their claims.” The abrogation claim of Terminal and the deficiency claim of bondholders are of equal rank with the debenture holders. These claims are not assumed by New Haven in the plan (par.",
"3(e)) and the administration claims are assumed subject to the limitation with respect to the Boston Terminal (par. 3). Terminal’s and the bondholder’s claims must be satisfied out of the 4% fixed interest bonds of New Haven paid for the debtor’s assets. Paragraph 5 of the plan specifically provides how claims of equal rank to the debentures shall be paid. That paragraph reads, in part, as follows: “In the event that any claims not assumed by the New York, New Haven and Hartford Railroad Company and ranking equally with the Boston and Providence Railroad Corporation debentures have been allowed by the court prior to the date of the consummation of the plan, holders of such claims also shall be allotted New York, New Haven and Hartford Railroad Company first and refunding mortgage 4-per-cent bonds in a principal amount equal to the aggregate of such claims.” To the extent these claims of Terminal and the bondholders are allowed, the insufficiency of the New Haven 4% bonds already shown with respect to the debenture holders of the debtor, would be materially increased.",
"It is clear there are not sufficient 4% bonds of New Haven to satisfy the debentures and the damage and bondholders’ claims. And, if Terminal rejects the offer in paragraph 2 and proves its administration claim without limitation, how is that proportion of the administration claim which, in view of the limitation in paragraph 3, New Haven does not assume, to be paid ? There is no provision in the plan for it. Another provision in paragraph 5 should be noticed. It states that claims of equal rank to debentures of the debtor allowed prior to date of consummation will be entitled to participate in the 4-percents of New Haven. (Emphasis suggested). It may result that the claims of Terminal and the bondholders might not be allowed until long after consummation of the plan. There is no proviso to reserve New Haven fixed interest bonds- Ito satisfy claims proved after consummation of plan as there was of common stock to satisfy claims under Section J(17) of the New Haven plan. The effect of this would be that these claims, proved after confirmation, would not be provided for in the plan.",
"In view of what has already been said, paragraph 6 of the plan is invalid. This paragraph of the plan contemplates distribution of securities to the debtor’s stockholders. With the deficiency of securities to provide for the debenture holders and the probability of claims being proved by Terminal and the bondholders of Terminal, this paragraph violates the priority rule of the Northern Pacific Railway Co. v. Boyd, 228 U.S. 482, 33 S.Ct. 554, 57 L. Ed. 931; Los Angeles Lumber Products Co., v. Case, 308 U.S. 106, 60 S.Ct. 1, 84 L.Ed. 110 and Consolidated Rock Co. v. Du Bois, 312 U.S. 510, 525, 61 S.Ct. 675, 85 L. Ed. 982 cases. “The important element is-the allocation of the securities so as to preserve to creditors the advantages of their respective priorities.” Ecker v. Western Pacific Railroad Corporation, supra, 318 U„ *190S. page 483, 63 S.Ct.",
"page 712, 87 L.Ed. 892. For the conclusions and reasons above stated, the plan is not approved. On motion of the parties, it is Ordered that the proceedings-be referred back to the Com-mision for further action. This was the precise offer made by New Haven and adopted by the Commission in its initial report and order of March 22, 1940. The Commission might consider in further proceedings whether any factors have arisen since 1940 that would affect the price to be paid for the debtor’s assets. The offer by New Haven to acquire upon the accomplishment of the modification of debtor’s obligation to Terminal. If paragraph 2 is construed as the Boston & Providence is. conditioned an offer, in view of the limitation concerning the Boston Terminal Company in paragraph 3 of the plan, it is very doubtful that this alteration in the terms of the New Haven offer would be binding on the New Haven.",
"* (See D.C., 54 * No one represented the New Haven at this hearing. F.Supp. 595, 618, and footnote page 622.) (Cf. 244 I.C.C. 247, at which time the-Commission required New Haven to pur*189chase Boston & Providence, provided, however that the plan of reorganization of the Boston & Providence is accepted and confirmed.)"
] | https://www.courtlistener.com/api/rest/v3/opinions/8691467/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Claims 2, 3, 15, 16, 36 have been canceled. Claims 1, 4-14, 17-35, and 37-49 are pending in the instant application.
Applicant’s election of the invention of the anti-FcRn antibody species comprising the six CDR sequences of SEQ ID NOs1-6 in the reply filed on July 28, 2021 is acknowledged. Because applicant did not distinctly and specifically point out the supposed errors in the restriction requirement, the election has been treated as an election without traverse (MPEP § 818.01(a)).
Information Disclosure Statement The IDS forms received 6/24/2021 are acknowledged and the references cited therein have been considered.
Claim Rejections - 35 USC § 112
The following is a quotation of 35 U.S.C. 112(b):
(b) CONCLUSION.—The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the inventor or a joint inventor regards as the invention.
The following is a quotation of 35 U.S.C. 112 (pre-AIA ), second paragraph:
The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention.
Claim 17 is rejected under 35 U.S.C. 112(b) or 35 U.S.C. 112 (pre-AIA ), second paragraph, as being indefinite for failing to particularly point out and distinctly claim the Specifically, claim 17 is recited as depending from claim 16, but claim 16 is presently canceled. As such it is impossible to know the metes and bound of claim 17 with certainty and thus the claim is indefinite.
In the spirit of compact prosecution, for the remainder of this office action it has bene assumed that claim 17 is actually directly depending from independent claim 1. If this was not actually applicant’s intent, additional grounds of rejection necessitated by applicant’s amendments will be set forth in future office actions.
The following is a quotation of the first paragraph of 35 U.S.C. 112(a): (a) IN GENERAL.—The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor or joint inventor of carrying out the invention.
The following is a quotation of the first paragraph of pre-AIA 35 U.S.C. 112: The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor of carrying out his invention.
Claims 1, 5-7, 9, 11, 12, 17-35, 37-39, 41-44, and 49 are rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the written description requirement. The claim(s) contains subject matter which was not described in the specification in such a way as to reasonably convey to one skilled in the relevant art that the inventor or a joint inventor, or for applications subject to pre-AIA 35 U.S.C. 112, the inventors, at the time the application was filed, had possession of the claimed invention. 2m (claim 34). To support such breadth the specification discloses the anti-FcRn antibody UCB7665/rozanolixizumab (SEQ ID NOs:43 and 22) as well as variants of this antibody, such as truncations with just the variable domains (i.e. the VH of SEQ ID NO:29 and the VL of SEQ ID NO:15, see claim 8). Minimal interim results of a human clinical trial to treat ITP by administering rozanolixizumab are reported in example 2. The guidelines for the Examination of Patent Applications Under the 35 U.S.C. 112, § 1 "Written Description" Requirement make clear that if a claimed genus does not show actual reduction to practice for a representative number of species, then the Requirement may be alternatively met by reduction to drawings, or by disclosure of relevant, identifying characteristics, i.e., structure or other physical and or chemical properties, by functional characteristics coupled with a known or disclosed correlation between function and structure, or by a combination of such identifying characteristics, sufficient to show the applicant was in possession of the genus (Federal Register, Vol. 66, No. 4, pages 1099-1111, January 5, 2001, see especially page 1106 column 3). In The Regents of the University of California v. Eli Lilly (43 USPQ2d 1398-1412) 19 F. 3d 1559, the court held that disclosure of a single member of a genus (rat insulin) did not provide adequate written support for the claimed genus (all mammalian insulins). In this same case, the court also noted: “A definition by function, as we have previously indicated, does not suffice to define the genus because it is only an indication of what the gene does, rather than what it is. See Fiers, 984 F.2d at 1169-71, 25 USPQ2d at 1605-06 (discussing Amgen). It is only a definition of a useful result rather than a definition of what achieves that result. Many such genes may achieve that result. The description requirement of the patent statute requires a description of an invention, not In re Wilder, 736 F.2d 1516, 1521, 222 USPQ 369, 372-73 (Fed. Cir. 1984) (affirming rejection because the specification does “little more than outlin [e] goals appellants hope the claimed invention achieves and the problems the invention will hopefully ameliorate."). Accordingly, naming a type of material generally known to exist, in the absence of knowledge as to what that material consists of, is not a description of that material.” The court has further stated that “Adequate written description requires a precise definition, such as by structure, formula, chemical name or physical properties, not a mere wish or plan for obtaining the claimed chemical invention.” Id. at 1566, 43 USPQ2d at 1404 (quoting Fiers, 984 F.2d at 1171, 25 USPQ2d at 1606). Also see Enzo-Biochem v. Gen-Probe 01-1230 (CAFC 2002). Recent court cases have emphasized the need for correlation between a well-defined structure and recited functional limitations. For example, the courts have indicated that recitation of an antibody which has specific functional properties in the absence of knowledge of the antibody sequences that give rise to said functional properties do not satisfy the requirements for written description. See for example AbbVie Deutschland GmbH v. Janssen Biotech. Inc. 759 F.3d 1285 (Fed. Cir. 2014) as well as Amgen v. Sanofi, (Fed Cir, 2017-1480. 10/5/2017). Indeed, in Amgen the court indicates that that it is improper to allow patentees to claim antibodies by describing something that is not the invention, i.e. the antigen, as knowledge of the chemical structure of an antigen does not give the required kind of structure-identifying information about the corresponding antibodies, with the antibody-antigen relationship be analogized as a search for a key on a ring with a million keys on it. As such, knowledge of where an antibody binds provides no information as to what such an antibody necessarily looks like (i.e. its primary amino acid structure). Applicant is reminded that the courts have long ruled that “Possession may not be shown by merely describing how to obtain possession of members of the claimed genus or how to identify their common structural features.” See University of Rochester, 358 F.3d at 927, 69 USPQ2d at 1895. As such, disclosure of a screening assay to test for functional properties of an antibody (such as the epitope to which a test antibody binds or the fact that it does or does not inhibit some enzymatic process) does not provide evidence of possession of the antibody itself. Amgen Inc. v. Sanofi, 124 USPQ2d 1354 (Fed. Cir. 2017), relying upon Ariad Pharms., Inc. v. Eli Lily & Co., 94 USPQ2d 1161 (Fed Cir. 2010), the following is noted. To show invention, a patentee must convey in its disclosure that is “had possession of the claimed subject matter as of the filing date. Demonstrating possession “requires a precise definition” of the invention. To provide this precise definition” for a claim to a genus, a patentee must disclose “a representative number of species within the scope of the genus of structural features common to the members of the genus so that one of skill in the art can visualize or recognize the member of the genus” (see Amgen at page 1358). Further, an adequate written description must contain enough information about the actual makeup of the claimed products – “a precise definition, such as structure, formula, chemic name, physical properties of other properties, of species falling with the genus sufficient to distinguish the gene from other materials”, which may be present in “functional terminology when the art has established a correlation between structure and function” (Amgen page 1361). Indeed, the courts have long ruled that “When a patent claims a genus using functional language to define a desired result, the specification must demonstrate that the applicant has made a generic invention that achieves the claimed Capon v. Eshhar, 418 F.3d 1349 (Fed. Cir. 2005). Also, “A sufficient description of a genus . . . requires the disclosure of either a representative number of species falling within the scope of the genus or structural features common to the members of the genus so that one of skill in the art can "visualize or recognize" the members of the genus.” See AbbVie, 759 F.3d at 1297, reiterating Eli Lilly, 119 F.3d at 1568-69. It should also be noted that the USPTO has released a Memo on the Clarification of Written Description Guidance For Claims Drawn to Antibodies and Status of 2008 Training Materials, 02/22/2018. See https://www.uspto.gov/sites/default/files/documents/amgen_22feb2018.pdf. This Memo clarifies the applicability of USPTO guidance regarding the written description requirement of 35 U.S.C. § 112(a) concerning the written description requirement for claims drawn to antibodies and states: “In view of the Amgen decision, adequate written description of a newly characterized antigen alone should not be considered adequate written description of a claimed antibody to that newly characterized antigen, even when preparation of such an antibody is routine and conventional”. Further, the courts have indicated that the enablement and written description requirements of 35 USC 112 are separable as can be seen in for example Vas-Cath Inc. v. Mahurkar, 19 USPQ2d 1111. Artisans are well aware that knowledge of a given antigen (for instance human FcRn) provides no information concerning the sequence/structure of antibodies that bind the given antigen. For example, Edwards et al. teach that over 1,000 different antibodies to a single protein can be generated, all with different sequences spanning almost the entire heavy and light chain germline repertoire (42/49 functional heavy chain germlines and 33 of 70 V-lambda and V-kappa light chain germlines, and with extensive diversity in the HCDR3 region sequences (that are generated by VDJ germline segment recombination) as well, see entire document). Similarly, Lloyd et al. teach that a large majority of VH/VL germline gene segments are used in the antibody response to an antigen, even when the antibodies were selected by antigen binding, as their sequencing studies revealed that out of 841 unselected and 5,044 selected antibodies, all but one of the 49 functional VH gene segments was observed (see entire document). Goel et al. disclose the synthesis of three mAbs that bind to the same short 26 distinct sequences, an astronomical number that is far greater than the calculated number of all B cell clones that can be generated during the lifespan of a healthy human (estimated to be 4 × 1014). It is noted that applicant has not claimed a product, but rather a method of administering a product. However, artisans must reasonably be in possession of a product in order to be in possession of methods of administering said product. As has already been pointed out the broadest claims recite no structure for the administered antibodies which minimally have the functional property of binding to FcRn, and dependent claims which recite additional function properties, such as high affinity binding (claim 17), blocking (claim 33) and not binding 2m (claim 34, and it should be noted that the FcRn polypeptide is expressed on the cell surface in a complex that also contains 2m, see page 5 of the instant specification) also lack any specific structure which is tied to these functional properties. Thus, all of claims 1, 5, 9, 11, 12, 17-35, 37-39, 41-44, and 49 recite administration of a product to treat ITP which is defined using only functional language. Other claims such as claims 6 and 7 attempt to provide some structure, such as either a VH or VL sequence defined by SEQ ID number, but neither claim contains a paired VH/VL (compare claims 6 and 7 to claim 8 which is not part of the instant rejection) and thus lacks the six defined CDR sequences generally accepted in the art as being the structure which is correlated with functional activities such as antigen binding. Note also that while a variable domain does comprise three CDRs, the 80% identical language allows for mutations/sequence alterations anywhere along the Therefore, in view of the breadth of the claims and the teachings of the art, artisans would reasonably conclude that applicant was not in possession of the full breadth of anti-FcRn antibodies at the time the instant application was filed even if applicant was in possession of rozanolixizumab/UCB7665. Logically, if applicant was not in possession of the agent which is being administered, applicant also was not in possession of methods of administering such reagents at the time the instant application was filed.
Claims 1, 4-14, 17-35, and 37-49 are rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the enablement requirement. The claims contain subject matter which was not described in the specification in such a way as to enable one skilled in the art to which it pertains, or with which it is most nearly connected, to make and/or use the invention. Applicant has claimed methods of “treating or preventing” immune (idiopathic) thrombocytopenic purpura by administering an antibody that binds to FcRn. Applicant discloses limited preliminary data from the administration of UCB7665/rozanolixizumab Page 36 of the instant specification presents non-limiting guidance concerning what is encompassed by “treatment” and “prevention”, with treatment encompassing any reduction in disease severity while “prevention” encompasses any reduction or delay in the onset of symptoms of ITP. As set forth above, the clinical data shared in the instant specification, while demonstrating treatment in that disease severity was reduced, does not demonstrate “prevention” as the patients already had ITP before being selected for the study. The instant application does not appear to disclose any diagnostic method to determine who will or will not develop ITP in the future, and reasonably “prevention” means that something never happens at all (i.e. encompasses 100% efficacy). As evidenced by the Merck Manual, ITP is diagnosed upon the presence of observable clinical signs and symptoms, most notable being low platelet count (see entire document). Given that artisans would need to identity the human subject prior to the manifestation of any clinical sign or symptom of ITP in order to “prevent” ITP identifying the patient population upon whom such a method will be practiced is non-trivial as no human reasonably wants/needs ITP yet performing the claimed methods upon every extant person for the purpose of “prevention” is clearly unreasonable. Thus, significant issues surrounding both patient selection as well as efficacy levels are raised by the concept of “prevention” as set forth in the instant application, with such issues requiring significant unpredictable basic science research and experimentation in order to be able to practice the full breadth of what has been claimed by applicant.
Claim Rejections - 35 USC § 102 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of the appropriate paragraphs of 35 U.S.C. 102 that form the basis for the rejections under this section made in this Office action: A person shall be entitled to a patent unless –
(a)(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.
(a)(2) the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.
Claims 1, 4-14, 17-21, 28, and 32-34 are rejected under 35 U.S.C. 102(a)(1) as being anticipated by Finney et al. (WO 2014/019727). Finney et al. disclose antibodies that bind FcRn as well as the administration of such antibodies to treat human diseases including ITP (see entire document, particularly the abstract, claims, and pages 33-36). Notably, the antibodies disclosed by Finney et al. have the same sequences as those recited by SEQ ID number in the instant claims (see enclosed alignments), and note that as per the paragraph spanning page 2-3 of the instant specification as well as lines 15-17 of page 42 of the instant specification these sequences are those of rozanolixizumab/UCB7665. Administered anti-FcRn antibodies are disclosed as being of various isotypes including IgG4P as well .
Claim Rejections - 35 USC § 103 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to
Claims 22-27, 29-31, 35, and 37-49 are rejected under 35 U.S.C. 103 as being unpatentable over Finney et al. (WO 2014/019727). Finney et al. disclose antibodies that bind FcRn as well as the administration of such antibodies to treat human diseases including ITP (see entire document, particularly the abstract, claims, and pages 33-36). Notably, the antibodies disclosed by Finney et al. have the same sequences as those recited by SEQ ID number in the instant claims (see enclosed alignments), and note that as per the paragraph spanning page 2-3 of the instant specification as well as lines 15-17 of page 42 of the instant specification these sequences are those of rozanolixizumab/UCB7665. Administered anti-FcRn antibodies are disclosed as being of various isotypes including IgG4P as well as antigen binding fragments including Fab (see for example pages 5-17). Notably, the antibodies of Finney et al. are disclosed as binding with high affinity (i.e. 100pM or less) at both pH 6 and 7.4 (see for example page 19 as well as working examples 3-5) and as being administered as part of pharmaceutical compositions comprising additional active therapeutic agents (see particularly pages 28-33). Dosing information including mass of administered drug as well as routes and time intervals of repeated administration that meet the instant claim limitations are also disclosed (see particularly pages 29-31), with 20 mg/kg being administered intravenously as part of a working example (see particularly example 7). It is also disclosed that dosing can be varied to best meet the needs of the patient, and that such optimization is routinely done by clinicians (see most particularly lines 16-25 of page 29). These teachings differ from the instant claimed invention in that the exact doses and time intervals as recited in the instant claims are not explicitly taught by Finney et al. Given that Finney explicitly teach that administration of the same active agent (UCB7665/rozanolixizumab) for the treatment of the same disease (ITP) determining appropriate doses and time intervals between administrations is a matter of routine optimization of a results effective variable in order to best meet the needs of the patient, wherein the “results” are the ITP patient improving (i.e. being “treated”) and the variable In re Wertheim, 541 F.2d 257, 191 USPQ 90 (CCPA 1976). Additionally, "[W]here the general conditions of a claim are disclosed in the prior art, it is not inventive to discover the optimum or workable ranges by routine experimentation." In re Aller, 220 F.2d 454, 456, 105 USPQ 233, 235 (CCPA 1955). Therefore, given that the prior art teaches administering rozanolixizumab to treat ITP and that such administrations can be varied to meet the needs of the patient, determining specific values such as those recited in the instant claims appears to involve no more than routine optimization to determine the best ways to implement the teachings of the prior art to best meet the needs of the patient. Additionally, given the large array of drug dose values as well as time intervals recited in the instant claims, there does not appear to be any criticality to either the drug mass or time value as all such values are effective in treating ITP as is evidenced by the instant claims themselves.
Double Patenting The nonstatutory double patenting rejection is based on a judicially created doctrine grounded in public policy (a policy reflected in the statute) so as to prevent the unjustified or improper timewise extension of the “right to exclude” granted by a patent and to prevent possible harassment by multiple assignees. A nonstatutory double patenting rejection is appropriate where the conflicting claims are not identical, but at least one examined application claim is not patentably distinct from the reference claim(s) because the examined application claim is either anticipated by, or would have been obvious over, the reference claim(s). See, e.g., In re Berg, 140 F.3d 1428, 46 USPQ2d 1226 (Fed. Cir. 1998); In re Goodman, 11 F.3d 1046, 29 USPQ2d 2010 (Fed. In re Longi, 759 F.2d 887, 225 USPQ 645 (Fed. Cir. 1985); In re Van Ornum, 686 F.2d 937, 214 USPQ 761 (CCPA 1982); In re Vogel, 422 F.2d 438, 164 USPQ 619 (CCPA 1970); In re Thorington, 418 F.2d 528, 163 USPQ 644 (CCPA 1969). A timely filed terminal disclaimer in compliance with 37 CFR 1.321(c) or 1.321(d) may be used to overcome an actual or provisional rejection based on nonstatutory double patenting provided the reference application or patent either is shown to be commonly owned with the examined application, or claims an invention made as a result of activities undertaken within the scope of a joint research agreement. See MPEP § 717.02 for applications subject to examination under the first inventor to file provisions of the AIA as explained in MPEP § 2159. See MPEP § 2146 et seq. for applications not subject to examination under the first inventor to file provisions of the AIA . A terminal disclaimer must be signed in compliance with 37 CFR 1.321(b). The USPTO Internet website contains terminal disclaimer forms which may be used. Please visit www.uspto.gov/patent/patents-forms. The filing date of the application in which the form is filed determines what form (e.g., PTO/SB/25, PTO/SB/26, PTO/AIA /25, or PTO/AIA /26) should be used. A web-based eTerminal Disclaimer may be filled out completely online using web-screens. An eTerminal Disclaimer that meets all requirements is auto-processed and approved immediately upon submission. For more information about eTerminal Disclaimers, refer to www.uspto.gov/patents/process/file/efs/guidance/eTD-info-I.jsp.
Claims 1, 5, 9, 11, 12, 17-35, 37-39, 41-44, and 49 are rejected on the ground of nonstatutory double patenting as being unpatentable over claims 1-22 of U.S. Patent No. 10,273,302. Although the claims at issue are not identical, they are not patentably distinct from each other because the instant claimed inventions are obvious variants of the issued claims. Specifically the ‘302 patent recites antibody products that bind FcRn, as well as methods of administering such antibodies to treat ITP (see all issued claims, most notably claims 20 and 21). Notably, the antibodies claimed and administered in the ‘302 patent are defined by SEQ ID number while the instant claimed inventions are not limited to any particular sequence. While it is true that the issued claims do not recite limitations such as the mass of antibody administered or how frequently it is administered, given the existence of claims 20 and 21 artisans would know that the antibodies and antibody compositions of the ‘302 patent are effective in treating ITP. Thus, artisans would be motivated to figure out using routine optimization how much In re Aller, 220 F.2d 454, 456, 105 USPQ 233, 235 (CCPA 1955). Therefore, given that the ‘302 patent claims administering anti-FcRn antibodies defined by SEQ ID number to treat ITP, determining specific values such as those recited in the instant claims which would be needed to actually perform an administration to a patient appears to involve no more than routine optimization to determine the best ways to implement the prior claimed treatment methods. Additionally, given the large array of drug dose values as well as time intervals recited in the instant claims, there does not appear to be any criticality to either the drug mass or time value as all such values are effective in treating ITP as is evidenced by the instant claims themselves, as well as the generic nature of the issued claims. It is noted that none of the instant inventors are inventors listed on the ‘302 patent. However, given that both the instant application and the ‘302 patent are commonly assigned to UCB Biopharma the instant rejection has been set forth. If the assignment data is incorrect, applicant is invited to clarify the matter in the written record.
Claims 1, 4-14, 17-35, and 37-49 are provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claims 1-12 and 20-23 of copending Application No. 16/271,086. Although the claims at issue are not identical, they are not patentably distinct from each other because the instant claimed invention is an obvious variant of the inventions of the copending application. Specifically, the copending claims recite methods of administering antibodies that bind to FcRn for the purpose of treating various diseases including ITP (see all In re Aller, 220 F.2d 454, 456, 105 USPQ 233, 235 (CCPA 1955). Therefore, given that the copending claims administer anti-FcRn antibodies defined by SEQ ID number to treat ITP that are the same as the instant application, determining specific values such as those recited in the instant claims which would be needed to actually perform an administration to a patient appears to involve no more than routine optimization to determine the best ways to implement the copending claimed treatment methods. Additionally, given the large array of drug dose values as well as time intervals recited in the instant claims, there does not appear to be any criticality to either the drug mass or time value as all such values are effective in treating ITP as is evidenced by the instant claims themselves. It is noted that none of the instant inventors are inventors listed on the copending application. However, given that both the instant and copending application appear to be commonly assigned to UCB Biopharma the instant rejection has been set forth. If the assignment data is incorrect, applicant is invited to clarify the matter in the written record. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented.
No claims are allowable.
Any inquiry concerning this communication or earlier communications from the examiner should be directed to Michael Szperka whose telephone number is (571)272-2934. The examiner can normally be reached on Monday-Friday 8:30-5:00. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice.
Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
Michael Szperka Primary Examiner Art Unit 1644
/MICHAEL SZPERKA/Primary Examiner, Art Unit 1644 | 2021-10-05T04:30:55 | [
"DETAILED ACTION The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claims 2, 3, 15, 16, 36 have been canceled. Claims 1, 4-14, 17-35, and 37-49 are pending in the instant application. Applicant’s election of the invention of the anti-FcRn antibody species comprising the six CDR sequences of SEQ ID NOs1-6 in the reply filed on July 28, 2021 is acknowledged. Because applicant did not distinctly and specifically point out the supposed errors in the restriction requirement, the election has been treated as an election without traverse (MPEP § 818.01(a)). Information Disclosure Statement The IDS forms received 6/24/2021 are acknowledged and the references cited therein have been considered. Claim Rejections - 35 USC § 112 The following is a quotation of 35 U.S.C.",
"112(b): (b) CONCLUSION.—The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the inventor or a joint inventor regards as the invention. The following is a quotation of 35 U.S.C. 112 (pre-AIA ), second paragraph: The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention. Claim 17 is rejected under 35 U.S.C. 112(b) or 35 U.S.C. 112 (pre-AIA ), second paragraph, as being indefinite for failing to particularly point out and distinctly claim the Specifically, claim 17 is recited as depending from claim 16, but claim 16 is presently canceled. As such it is impossible to know the metes and bound of claim 17 with certainty and thus the claim is indefinite.",
"In the spirit of compact prosecution, for the remainder of this office action it has bene assumed that claim 17 is actually directly depending from independent claim 1. If this was not actually applicant’s intent, additional grounds of rejection necessitated by applicant’s amendments will be set forth in future office actions. The following is a quotation of the first paragraph of 35 U.S.C. 112(a): (a) IN GENERAL.—The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor or joint inventor of carrying out the invention. The following is a quotation of the first paragraph of pre-AIA 35 U.S.C. 112: The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor of carrying out his invention.",
"Claims 1, 5-7, 9, 11, 12, 17-35, 37-39, 41-44, and 49 are rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the written description requirement. The claim(s) contains subject matter which was not described in the specification in such a way as to reasonably convey to one skilled in the relevant art that the inventor or a joint inventor, or for applications subject to pre-AIA 35 U.S.C. 112, the inventors, at the time the application was filed, had possession of the claimed invention. 2m (claim 34). To support such breadth the specification discloses the anti-FcRn antibody UCB7665/rozanolixizumab (SEQ ID NOs:43 and 22) as well as variants of this antibody, such as truncations with just the variable domains (i.e. the VH of SEQ ID NO:29 and the VL of SEQ ID NO:15, see claim 8).",
"Minimal interim results of a human clinical trial to treat ITP by administering rozanolixizumab are reported in example 2. The guidelines for the Examination of Patent Applications Under the 35 U.S.C. 112, § 1 \"Written Description\" Requirement make clear that if a claimed genus does not show actual reduction to practice for a representative number of species, then the Requirement may be alternatively met by reduction to drawings, or by disclosure of relevant, identifying characteristics, i.e., structure or other physical and or chemical properties, by functional characteristics coupled with a known or disclosed correlation between function and structure, or by a combination of such identifying characteristics, sufficient to show the applicant was in possession of the genus (Federal Register, Vol. 66, No. 4, pages 1099-1111, January 5, 2001, see especially page 1106 column 3).",
"In The Regents of the University of California v. Eli Lilly (43 USPQ2d 1398-1412) 19 F. 3d 1559, the court held that disclosure of a single member of a genus (rat insulin) did not provide adequate written support for the claimed genus (all mammalian insulins). In this same case, the court also noted: “A definition by function, as we have previously indicated, does not suffice to define the genus because it is only an indication of what the gene does, rather than what it is. See Fiers, 984 F.2d at 1169-71, 25 USPQ2d at 1605-06 (discussing Amgen).",
"It is only a definition of a useful result rather than a definition of what achieves that result. Many such genes may achieve that result. The description requirement of the patent statute requires a description of an invention, not In re Wilder, 736 F.2d 1516, 1521, 222 USPQ 369, 372-73 (Fed. Cir. 1984) (affirming rejection because the specification does “little more than outlin [e] goals appellants hope the claimed invention achieves and the problems the invention will hopefully ameliorate.\"). Accordingly, naming a type of material generally known to exist, in the absence of knowledge as to what that material consists of, is not a description of that material.” The court has further stated that “Adequate written description requires a precise definition, such as by structure, formula, chemical name or physical properties, not a mere wish or plan for obtaining the claimed chemical invention.” Id. at 1566, 43 USPQ2d at 1404 (quoting Fiers, 984 F.2d at 1171, 25 USPQ2d at 1606). Also see Enzo-Biochem v. Gen-Probe 01-1230 (CAFC 2002). Recent court cases have emphasized the need for correlation between a well-defined structure and recited functional limitations. For example, the courts have indicated that recitation of an antibody which has specific functional properties in the absence of knowledge of the antibody sequences that give rise to said functional properties do not satisfy the requirements for written description. See for example AbbVie Deutschland GmbH v. Janssen Biotech. Inc. 759 F.3d 1285 (Fed. Cir. 2014) as well as Amgen v. Sanofi, (Fed Cir, 2017-1480. 10/5/2017). Indeed, in Amgen the court indicates that that it is improper to allow patentees to claim antibodies by describing something that is not the invention, i.e. the antigen, as knowledge of the chemical structure of an antigen does not give the required kind of structure-identifying information about the corresponding antibodies, with the antibody-antigen relationship be analogized as a search for a key on a ring with a million keys on it.",
"As such, knowledge of where an antibody binds provides no information as to what such an antibody necessarily looks like (i.e. its primary amino acid structure). Applicant is reminded that the courts have long ruled that “Possession may not be shown by merely describing how to obtain possession of members of the claimed genus or how to identify their common structural features.” See University of Rochester, 358 F.3d at 927, 69 USPQ2d at 1895. As such, disclosure of a screening assay to test for functional properties of an antibody (such as the epitope to which a test antibody binds or the fact that it does or does not inhibit some enzymatic process) does not provide evidence of possession of the antibody itself. Amgen Inc. v. Sanofi, 124 USPQ2d 1354 (Fed. Cir. 2017), relying upon Ariad Pharms., Inc. v. Eli Lily & Co., 94 USPQ2d 1161 (Fed Cir.",
"2010), the following is noted. To show invention, a patentee must convey in its disclosure that is “had possession of the claimed subject matter as of the filing date. Demonstrating possession “requires a precise definition” of the invention. To provide this precise definition” for a claim to a genus, a patentee must disclose “a representative number of species within the scope of the genus of structural features common to the members of the genus so that one of skill in the art can visualize or recognize the member of the genus” (see Amgen at page 1358). Further, an adequate written description must contain enough information about the actual makeup of the claimed products – “a precise definition, such as structure, formula, chemic name, physical properties of other properties, of species falling with the genus sufficient to distinguish the gene from other materials”, which may be present in “functional terminology when the art has established a correlation between structure and function” (Amgen page 1361). Indeed, the courts have long ruled that “When a patent claims a genus using functional language to define a desired result, the specification must demonstrate that the applicant has made a generic invention that achieves the claimed Capon v. Eshhar, 418 F.3d 1349 (Fed. Cir. 2005).",
"Also, “A sufficient description of a genus . . . requires the disclosure of either a representative number of species falling within the scope of the genus or structural features common to the members of the genus so that one of skill in the art can \"visualize or recognize\" the members of the genus.” See AbbVie, 759 F.3d at 1297, reiterating Eli Lilly, 119 F.3d at 1568-69. It should also be noted that the USPTO has released a Memo on the Clarification of Written Description Guidance For Claims Drawn to Antibodies and Status of 2008 Training Materials, 02/22/2018. See https://www.uspto.gov/sites/default/files/documents/amgen_22feb2018.pdf. This Memo clarifies the applicability of USPTO guidance regarding the written description requirement of 35 U.S.C. § 112(a) concerning the written description requirement for claims drawn to antibodies and states: “In view of the Amgen decision, adequate written description of a newly characterized antigen alone should not be considered adequate written description of a claimed antibody to that newly characterized antigen, even when preparation of such an antibody is routine and conventional”.",
"Further, the courts have indicated that the enablement and written description requirements of 35 USC 112 are separable as can be seen in for example Vas-Cath Inc. v. Mahurkar, 19 USPQ2d 1111. Artisans are well aware that knowledge of a given antigen (for instance human FcRn) provides no information concerning the sequence/structure of antibodies that bind the given antigen. For example, Edwards et al. teach that over 1,000 different antibodies to a single protein can be generated, all with different sequences spanning almost the entire heavy and light chain germline repertoire (42/49 functional heavy chain germlines and 33 of 70 V-lambda and V-kappa light chain germlines, and with extensive diversity in the HCDR3 region sequences (that are generated by VDJ germline segment recombination) as well, see entire document). Similarly, Lloyd et al.",
"teach that a large majority of VH/VL germline gene segments are used in the antibody response to an antigen, even when the antibodies were selected by antigen binding, as their sequencing studies revealed that out of 841 unselected and 5,044 selected antibodies, all but one of the 49 functional VH gene segments was observed (see entire document). Goel et al. disclose the synthesis of three mAbs that bind to the same short 26 distinct sequences, an astronomical number that is far greater than the calculated number of all B cell clones that can be generated during the lifespan of a healthy human (estimated to be 4 × 1014). It is noted that applicant has not claimed a product, but rather a method of administering a product. However, artisans must reasonably be in possession of a product in order to be in possession of methods of administering said product. As has already been pointed out the broadest claims recite no structure for the administered antibodies which minimally have the functional property of binding to FcRn, and dependent claims which recite additional function properties, such as high affinity binding (claim 17), blocking (claim 33) and not binding 2m (claim 34, and it should be noted that the FcRn polypeptide is expressed on the cell surface in a complex that also contains 2m, see page 5 of the instant specification) also lack any specific structure which is tied to these functional properties.",
"Thus, all of claims 1, 5, 9, 11, 12, 17-35, 37-39, 41-44, and 49 recite administration of a product to treat ITP which is defined using only functional language. Other claims such as claims 6 and 7 attempt to provide some structure, such as either a VH or VL sequence defined by SEQ ID number, but neither claim contains a paired VH/VL (compare claims 6 and 7 to claim 8 which is not part of the instant rejection) and thus lacks the six defined CDR sequences generally accepted in the art as being the structure which is correlated with functional activities such as antigen binding. Note also that while a variable domain does comprise three CDRs, the 80% identical language allows for mutations/sequence alterations anywhere along the Therefore, in view of the breadth of the claims and the teachings of the art, artisans would reasonably conclude that applicant was not in possession of the full breadth of anti-FcRn antibodies at the time the instant application was filed even if applicant was in possession of rozanolixizumab/UCB7665.",
"Logically, if applicant was not in possession of the agent which is being administered, applicant also was not in possession of methods of administering such reagents at the time the instant application was filed. Claims 1, 4-14, 17-35, and 37-49 are rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the enablement requirement. The claims contain subject matter which was not described in the specification in such a way as to enable one skilled in the art to which it pertains, or with which it is most nearly connected, to make and/or use the invention. Applicant has claimed methods of “treating or preventing” immune (idiopathic) thrombocytopenic purpura by administering an antibody that binds to FcRn.",
"Applicant discloses limited preliminary data from the administration of UCB7665/rozanolixizumab Page 36 of the instant specification presents non-limiting guidance concerning what is encompassed by “treatment” and “prevention”, with treatment encompassing any reduction in disease severity while “prevention” encompasses any reduction or delay in the onset of symptoms of ITP. As set forth above, the clinical data shared in the instant specification, while demonstrating treatment in that disease severity was reduced, does not demonstrate “prevention” as the patients already had ITP before being selected for the study. The instant application does not appear to disclose any diagnostic method to determine who will or will not develop ITP in the future, and reasonably “prevention” means that something never happens at all (i.e. encompasses 100% efficacy). As evidenced by the Merck Manual, ITP is diagnosed upon the presence of observable clinical signs and symptoms, most notable being low platelet count (see entire document).",
"Given that artisans would need to identity the human subject prior to the manifestation of any clinical sign or symptom of ITP in order to “prevent” ITP identifying the patient population upon whom such a method will be practiced is non-trivial as no human reasonably wants/needs ITP yet performing the claimed methods upon every extant person for the purpose of “prevention” is clearly unreasonable. Thus, significant issues surrounding both patient selection as well as efficacy levels are raised by the concept of “prevention” as set forth in the instant application, with such issues requiring significant unpredictable basic science research and experimentation in order to be able to practice the full breadth of what has been claimed by applicant. Claim Rejections - 35 USC § 102 In the event the determination of the status of the application as subject to AIA 35 U.S.C.",
"102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of the appropriate paragraphs of 35 U.S.C. 102 that form the basis for the rejections under this section made in this Office action: A person shall be entitled to a patent unless – (a)(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention. (a)(2) the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.",
"Claims 1, 4-14, 17-21, 28, and 32-34 are rejected under 35 U.S.C. 102(a)(1) as being anticipated by Finney et al. (WO 2014/019727). Finney et al. disclose antibodies that bind FcRn as well as the administration of such antibodies to treat human diseases including ITP (see entire document, particularly the abstract, claims, and pages 33-36). Notably, the antibodies disclosed by Finney et al. have the same sequences as those recited by SEQ ID number in the instant claims (see enclosed alignments), and note that as per the paragraph spanning page 2-3 of the instant specification as well as lines 15-17 of page 42 of the instant specification these sequences are those of rozanolixizumab/UCB7665. Administered anti-FcRn antibodies are disclosed as being of various isotypes including IgG4P as well .",
"Claim Rejections - 35 USC § 103 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains.",
"Patentability shall not be negated by the manner in which the invention was made. This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to Claims 22-27, 29-31, 35, and 37-49 are rejected under 35 U.S.C. 103 as being unpatentable over Finney et al.",
"(WO 2014/019727). Finney et al. disclose antibodies that bind FcRn as well as the administration of such antibodies to treat human diseases including ITP (see entire document, particularly the abstract, claims, and pages 33-36). Notably, the antibodies disclosed by Finney et al. have the same sequences as those recited by SEQ ID number in the instant claims (see enclosed alignments), and note that as per the paragraph spanning page 2-3 of the instant specification as well as lines 15-17 of page 42 of the instant specification these sequences are those of rozanolixizumab/UCB7665.",
"Administered anti-FcRn antibodies are disclosed as being of various isotypes including IgG4P as well as antigen binding fragments including Fab (see for example pages 5-17). Notably, the antibodies of Finney et al. are disclosed as binding with high affinity (i.e. 100pM or less) at both pH 6 and 7.4 (see for example page 19 as well as working examples 3-5) and as being administered as part of pharmaceutical compositions comprising additional active therapeutic agents (see particularly pages 28-33). Dosing information including mass of administered drug as well as routes and time intervals of repeated administration that meet the instant claim limitations are also disclosed (see particularly pages 29-31), with 20 mg/kg being administered intravenously as part of a working example (see particularly example 7). It is also disclosed that dosing can be varied to best meet the needs of the patient, and that such optimization is routinely done by clinicians (see most particularly lines 16-25 of page 29).",
"These teachings differ from the instant claimed invention in that the exact doses and time intervals as recited in the instant claims are not explicitly taught by Finney et al. Given that Finney explicitly teach that administration of the same active agent (UCB7665/rozanolixizumab) for the treatment of the same disease (ITP) determining appropriate doses and time intervals between administrations is a matter of routine optimization of a results effective variable in order to best meet the needs of the patient, wherein the “results” are the ITP patient improving (i.e. being “treated”) and the variable In re Wertheim, 541 F.2d 257, 191 USPQ 90 (CCPA 1976). Additionally, \"[W]here the general conditions of a claim are disclosed in the prior art, it is not inventive to discover the optimum or workable ranges by routine experimentation.\"",
"In re Aller, 220 F.2d 454, 456, 105 USPQ 233, 235 (CCPA 1955). Therefore, given that the prior art teaches administering rozanolixizumab to treat ITP and that such administrations can be varied to meet the needs of the patient, determining specific values such as those recited in the instant claims appears to involve no more than routine optimization to determine the best ways to implement the teachings of the prior art to best meet the needs of the patient.",
"Additionally, given the large array of drug dose values as well as time intervals recited in the instant claims, there does not appear to be any criticality to either the drug mass or time value as all such values are effective in treating ITP as is evidenced by the instant claims themselves. Double Patenting The nonstatutory double patenting rejection is based on a judicially created doctrine grounded in public policy (a policy reflected in the statute) so as to prevent the unjustified or improper timewise extension of the “right to exclude” granted by a patent and to prevent possible harassment by multiple assignees. A nonstatutory double patenting rejection is appropriate where the conflicting claims are not identical, but at least one examined application claim is not patentably distinct from the reference claim(s) because the examined application claim is either anticipated by, or would have been obvious over, the reference claim(s). See, e.g., In re Berg, 140 F.3d 1428, 46 USPQ2d 1226 (Fed. Cir. 1998); In re Goodman, 11 F.3d 1046, 29 USPQ2d 2010 (Fed.",
"In re Longi, 759 F.2d 887, 225 USPQ 645 (Fed. Cir. 1985); In re Van Ornum, 686 F.2d 937, 214 USPQ 761 (CCPA 1982); In re Vogel, 422 F.2d 438, 164 USPQ 619 (CCPA 1970); In re Thorington, 418 F.2d 528, 163 USPQ 644 (CCPA 1969). A timely filed terminal disclaimer in compliance with 37 CFR 1.321(c) or 1.321(d) may be used to overcome an actual or provisional rejection based on nonstatutory double patenting provided the reference application or patent either is shown to be commonly owned with the examined application, or claims an invention made as a result of activities undertaken within the scope of a joint research agreement. See MPEP § 717.02 for applications subject to examination under the first inventor to file provisions of the AIA as explained in MPEP § 2159.",
"See MPEP § 2146 et seq. for applications not subject to examination under the first inventor to file provisions of the AIA . A terminal disclaimer must be signed in compliance with 37 CFR 1.321(b). The USPTO Internet website contains terminal disclaimer forms which may be used. Please visit www.uspto.gov/patent/patents-forms. The filing date of the application in which the form is filed determines what form (e.g., PTO/SB/25, PTO/SB/26, PTO/AIA /25, or PTO/AIA /26) should be used. A web-based eTerminal Disclaimer may be filled out completely online using web-screens. An eTerminal Disclaimer that meets all requirements is auto-processed and approved immediately upon submission.",
"For more information about eTerminal Disclaimers, refer to www.uspto.gov/patents/process/file/efs/guidance/eTD-info-I.jsp. Claims 1, 5, 9, 11, 12, 17-35, 37-39, 41-44, and 49 are rejected on the ground of nonstatutory double patenting as being unpatentable over claims 1-22 of U.S. Patent No. 10,273,302. Although the claims at issue are not identical, they are not patentably distinct from each other because the instant claimed inventions are obvious variants of the issued claims. Specifically the ‘302 patent recites antibody products that bind FcRn, as well as methods of administering such antibodies to treat ITP (see all issued claims, most notably claims 20 and 21). Notably, the antibodies claimed and administered in the ‘302 patent are defined by SEQ ID number while the instant claimed inventions are not limited to any particular sequence.",
"While it is true that the issued claims do not recite limitations such as the mass of antibody administered or how frequently it is administered, given the existence of claims 20 and 21 artisans would know that the antibodies and antibody compositions of the ‘302 patent are effective in treating ITP. Thus, artisans would be motivated to figure out using routine optimization how much In re Aller, 220 F.2d 454, 456, 105 USPQ 233, 235 (CCPA 1955). Therefore, given that the ‘302 patent claims administering anti-FcRn antibodies defined by SEQ ID number to treat ITP, determining specific values such as those recited in the instant claims which would be needed to actually perform an administration to a patient appears to involve no more than routine optimization to determine the best ways to implement the prior claimed treatment methods.",
"Additionally, given the large array of drug dose values as well as time intervals recited in the instant claims, there does not appear to be any criticality to either the drug mass or time value as all such values are effective in treating ITP as is evidenced by the instant claims themselves, as well as the generic nature of the issued claims. It is noted that none of the instant inventors are inventors listed on the ‘302 patent. However, given that both the instant application and the ‘302 patent are commonly assigned to UCB Biopharma the instant rejection has been set forth. If the assignment data is incorrect, applicant is invited to clarify the matter in the written record. Claims 1, 4-14, 17-35, and 37-49 are provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claims 1-12 and 20-23 of copending Application No. 16/271,086. Although the claims at issue are not identical, they are not patentably distinct from each other because the instant claimed invention is an obvious variant of the inventions of the copending application.",
"Specifically, the copending claims recite methods of administering antibodies that bind to FcRn for the purpose of treating various diseases including ITP (see all In re Aller, 220 F.2d 454, 456, 105 USPQ 233, 235 (CCPA 1955). Therefore, given that the copending claims administer anti-FcRn antibodies defined by SEQ ID number to treat ITP that are the same as the instant application, determining specific values such as those recited in the instant claims which would be needed to actually perform an administration to a patient appears to involve no more than routine optimization to determine the best ways to implement the copending claimed treatment methods. Additionally, given the large array of drug dose values as well as time intervals recited in the instant claims, there does not appear to be any criticality to either the drug mass or time value as all such values are effective in treating ITP as is evidenced by the instant claims themselves.",
"It is noted that none of the instant inventors are inventors listed on the copending application. However, given that both the instant and copending application appear to be commonly assigned to UCB Biopharma the instant rejection has been set forth. If the assignment data is incorrect, applicant is invited to clarify the matter in the written record. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. No claims are allowable. Any inquiry concerning this communication or earlier communications from the examiner should be directed to Michael Szperka whose telephone number is (571)272-2934. The examiner can normally be reached on Monday-Friday 8:30-5:00. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only.",
"For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. Michael Szperka Primary Examiner Art Unit 1644 /MICHAEL SZPERKA/Primary Examiner, Art Unit 1644"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-09-26.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED [DECEMBER 31, 2011] Commission File Number 000-49654 CirTran Corporation (Exact name of registrant as specified in its charter) Nevada 68-0121636 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 4125 South 6000 West West Valley City, Utah (Address of principal executive offices) (Zip Code) (801) 963-5112 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Exchange Act: Title of each class Name of each exchange on which registered n/a n/a Securities registered pursuant to Section 12(g) of the Exchange Act: Common Stock, Par Value $0.001 (Title of Class) Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act.Yes¨Nox Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act.¨ Indicate by check mark whether the registrant: (1)has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days.YesxNo¨ Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).YesxNo¨ Indicate by check mark if disclosure of delinquent filers in response to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.¨ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. Large accelerated filer o Accelerated filer ¨ Non-accelerated filer o Smaller reporting company x Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes¨Nox State the aggregate market value of the voting and nonvoting common equity held by nonaffiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.As of June 30, 2011, the aggregate market value of the voting and nonvoting common equity held by nonaffiliates of the issuer was $4,126,020. Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.As of March 29, 2012, issuer had 1,839,302,289 shares of issued and outstanding common stock, par value $0.001. DOCUMENTS INCORPORATED BY REFERENCE:None. TABLE OF CONTENTS Part I Page Item 1 Business 3 Item 1A Risk Factors 11 Item 1B Unresolved Staff Comments 15 Item 2 Properties 15 Item 3 Legal Proceedings 15 Item 4 Mine Safety Disclosures 22 Part II Item 5 Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 23 Item 6 Selected Financial Data 24 Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations 24 Item 7A Quantitative and Qualitative Disclosures about Market Risk 33 Item 8 Financial Statements and Supplementary Data 33 Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 33 Item 9A Controls and Procedures 33 Item 9B Other Information 36 Part III Item 10 Directors, Executive Officers and Corporate Governance 37 Item 11 Executive Compensation 37 Item 12 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 37 Item 13 Certain Relationships and Related Transactions, and Director Independence 37 Item 14 Principal Accounting Fees and Services 37 Item 15 Exhibits, Financial Statement Schedules 38 Signatures 43 1 SPECIAL NOTE ABOUT FORWARD-LOOKING INFORMATION Certain statements in this Annual Report on Form 10-K are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).Forward-looking statements are typically identified by the use of the words “believe,” “may,” “could,” “should,” “expect,” “anticipate,” “estimate,” “project,” “propose,” “plan,” “intend,” and similar words and expressions.Statements that describe our future strategic plans, goals, or objectives are also forward-looking statements.Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements.The forward-looking statements included in this report are made only as of the date of this report. Readers of this report are cautioned that any forward-looking statements, including those regarding us or our management’s current beliefs, expectations, anticipations, estimations, projections, strategies, proposals, plans, or intentions, are not guarantees of future performance or results of events and involve risks and uncertainties, such as: · We may be deemed to be insolvent and may face liquidation. · The auditors’ report for our most recent fiscal year contains an explanatory paragraph about our ability to continue as a going concern. · Our ability to continue energy drink distribution, our principal source of revenue, is subject to interruption or termination because of PlayBev’s ongoing Chapter 11 reorganization proceedings and disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks. · Our interest in PlayBev may be diluted if we raise capital to fund expansion of our energy drink distribution segment. · All of our assets are encumbered to secure the payment of an aggregate of $5.9 million in indebtedness that requires substantial monthly payments, and our default could result in the loss of all of our assets. · We are parties to numerous lawsuits that require significant management attention and funds for attorney’s fees and subject to risk of damages. · We will require substantial amounts of additional capital from external sources. · Any substantial increase in sales will require skilled management of growth. · We cannot predict the impact on our activities of the current economic crises. · We are authorized to issue substantial additional shares of stock, which would dilute the ownership of our stockholders. · Penny stock regulations will impose certain restrictions on resales of our securities, which may cause an investor to lose some or all of its investment. · The factors set forth under “Management’s Discussion and Analysis of Analysis of Financial Condition and Results of Operation” and other factors that are not currently known to us that may emerge from time to time. The forward-looking information is based on present circumstances and on our predictions respecting events that have not occurred, that may not occur, or that may occur with different consequences from those now assumed or anticipated.Actual events or results may differ materially from those discussed in the forward-looking statements.The forward-looking statements included in this report are made only as of the date of this report. 2 PART I ITEM 1.BUSINESS INTRODUCTION AND OVERVIEW We manufacture, market, and distribute internationally an energy drink under a license, now in dispute, with Playboy Enterprises, Inc., or Playboy, and in the U.S., we provide a mix of high- and medium-volume turnkey manufacturing services and products using various high-tech applications for leading electronics OEMs (original equipment manufacturers) in the communications, networking, peripherals, gaming, law enforcement, consumer products, telecommunications, automotive, medical, and semiconductor industries.Our services include pre-manufacturing, manufacturing, and post-manufacturing services.Our goal is to offer customers the significant competitive advantages that can be obtained from manufacture outsourcing. We are engaged in the following business segments. Beverage Distribution (96% and 85% of total revenue during 2011 and 2010, respectively) CirTran Beverage manufactures, markets, and distributes Playboy-branded energy drinks in accordance with an agreement we entered into with Play Beverages, LLC, or PlayBev, a consolidated variable interest entity, which holds the Playboy license. Contract Manufacturing (4% and 1% of total revenue during 2011 and 2010, respectively) CirTran Products pursues contract-manufacturing relationships in the U.S. consumer products markets, including licensed merchandise sold in the sports and entertainment markets. CirTran Asia manufactures and distributes electronics, consumer products, and general merchandise to companies selling in international markets. Marketing and Media (0% and 12% of total revenue during 2011 and 2010, respectively) CirTran Online sells products via the Internet and provides services and support to Internet retailers. CirTran Media provides end-to-end services to the direct-response and entertainment industries. Electronics Assembly (0% and 2% of total revenue during 2011 and 2010, respectively) CirTran Corporation (“CirTran USA”) provides low-volume electronics assembly activities consisting primarily of placing and attaching electronic and mechanical components on printed circuit boards and flexible (i.e., bendable) cables. During 2011, our activities were significantly restrained by the necessity to devote priority to efforts to obtaining the forbearance of our principal secured and judgment creditors, seeking to resolve disputes respecting the PlayBev license to market Playboy-licensed energy drinks, defending the numerous lawsuits to which we are a party, and obtaining additional capital.Disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks impaired our ability to establish new distributors, damaged our relationships with existing distributors, and depressed revenues.All of our activities during the year, as in previous years, were adversely affected by our severe shortages of working capital and cash. References to “us,” “we,” and “our” and correlative terms refer to CirTran Corporation and the subsidiaries and divisions through which we conduct our activities. 3 PRIMARY PRODUCTS AND SERVICES Beverage Distribution CirTran Beverage In May 2007, we incorporated CirTran Beverage to arrange for the manufacture, marketing, and distribution of Playboy-licensed energy drinks, flavored water beverages, and related merchandise through various distribution channels.We also entered into an agreement with Play Beverages, LLC, or PlayBev, a related Delaware limited liability company and the licensee under a product licensing agreement with Playboy to market, manufacture, and distribute energy drinks and beverages under its brand name.Under the terms of the PlayBev agreement, we are to provide the initial development and promotional services to PlayBev, which will collect from us a royalty based on product sales and manufacturing costs once licensed product distribution commences.As part of our efforts to finance the initial development and marketing of the Playboy energy drink, we and other investors formed AfterBev, a majority owned subsidiary organized in California.Effective January 1, 2010, PlayBev was required to be consolidated into our financial statements as a variable interest entity. Regular and sugar-free versions of the Playboy energy drink, in 8.4 and 16 ounce cans, have been developed.We currently have sales and distribution networks in 65 countries throughout Europe, Africa, Australia, the Pacific, and the Middle East, and we anticipate continued growth in 2012, if the dispute over the license with Playboy is resolved by reaching a new license agreement.Energy drink sales and royalties in 2011 and 2010 accounted for 96% and 85% of total sales, respectively. Our net sales and assets by geographic area are as follows: Revenues United States of America $ $ Canada - Eastern Europe Russia - West Africa - South America - Western Europe - Other - $ $ As discussed in detail in Item 3. Legal Proceedings, in April 2011, creditors filed an involuntary bankruptcy petition against PlayBev.Thereafter, this proceeding was converted into a Chapter 11 reorganization proceeding, with PlayBev acting as debtor-in-possession.Playboy initially sought to terminate its product license agreement with PlayBev, but thereafter stipulated to suspend further proceedings pending the exploration of settlement.PlayBev is seeking a settlement that would enable it to continue to market worldwide Playboy-licensed nonalcoholic energy drinks, subject to annual minimum royalties during the following five years, beginning at $2.0 million and escalating to $3.0 million, with the payment of a portion of the royalty obligation assured through our posting of an irrevocable letter of credit.PlayBev would also seek Playboy’s agreement not to circumvent PlayBev’s licensed rights by directly approaching its distributors and downstream marketing channels for so long as it meets its financial obligations to Playboy.We cannot assure that PlayBev will be able to negotiate a settlement with Playboy or predict the terms that may be negotiated.We anticipate that any settlement reached will require PlayBev to obtain substantial amounts of new capital in order to implement and take advantage of such settlement.We will be principally responsible for managing such funding effort.See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations: Liquidity and Capital Resources. 4 If the Playboy licensing dispute is not resolved satisfactorily to us through a negotiated settlement or litigation in the PlayBev Chapter 11 reorganization proceeding, PlayBev would be required to terminate its beverage distribution activities, which are currently the principal source of our revenues. In March 2012, Playboy and PlayBev extended the license through July 31, 2012 to allow them time to negotiate a potential new licensing agreement. The Playboy energy drink and other products we are developing are part of a growing market segment of the beverage industry known as the “new age” or alternative beverage industry.This beverage category includes noncarbonated, ready-to-drink iced teas, lemonades, juice cocktails, single-serve juices and fruit beverages, ready-to-drink dairy and coffee drinks, energy drinks, sports drinks, and single-serve still water (flavored, unflavored, and enhanced) and sodas that are considered natural, sparkling juices, and flavored sparkling beverages. The new age beverage industry is still expanding.According to Beverage Digest, a trade publication covering the nonalcoholic beverages industry, caffeinated energy drinks have become the fastest-growing sector of the $93 billion domestic beverage industry. We believe this industry is growing due to current attention to new brands, non-coffee drinkers, and people interested in health and fitness.By directing products to specific groups, such as extreme sports enthusiasts, energy drinks target consumer groups made up primarily of male teenagers and young people in their 20s. Depending on the outcome of the PlayBev disputes with Playboy as discussed above, as we continue to market our Playboy energy drink and introduce other licensed products, we will compete with other beverage companies not only for consumer acceptance but also for shelf space in retail outlets and for marketing focus by our distributors, all of which also distribute other beverage brands.Our energy drink products compete with all nonalcoholic beverages.Most of the competing products are marketed by companies with substantially greater financial resources than we have.We also compete with regional beverage producers and “private label” soft drink suppliers.We believe that our leading energy drink competitors are Red Bull and Monster. Contract Manufacturing CirTran Products and CirTran - Asia CirTran Products pursues contract-manufacturing relationships in the domestic consumer products markets, including products in areas such as home/garden, kitchen, health/beauty, toys, licensed merchandise, and apparel for film, television, sports, and other entertainment properties.Licensed merchandise and apparel are defined as items that bear the image, likeness, or logo of a product or a person, such as a well-known celebrity, that are sold or advertised to the public.Licensed merchandise and apparel are sold and marketed in the entertainment and sports franchise industries.We have concentrated our product development efforts into three areas: home and kitchen appliances, beauty products, and licensed merchandise.We anticipate that these products will be introduced into the market either under one uniform brand name or under separate trademarked names owned by CirTran Products.We are presently preparing to launch various programs in which CirTran Media, discussed below, will operate as the marketer, campaign manager, and distributor in various product categories, including beauty products, entertainment products, software products, and fitness and consumer products.We anticipate increasing our role in this market as resources become available for allocation to this division. 5 The contract-manufacturing industry specializes in providing the program management, technical and administrative support, and manufacturing expertise required to take products from the early design and prototype stages through volume production and distribution.The goal is to provide the customer with a quality product, delivered on time and at the lowest cost.This full range of services gives the customer an opportunity to avoid large capital investments in plant, inventory, equipment, and staffing and to concentrate instead on innovation, design, and marketing.By using our contract-manufacturing services, customers have the ability to improve the return on their investment with greater flexibility in responding to market demands and exploiting new market opportunities. In previous years, we found that customers increasingly required contract manufacturers to provide complete turn-key manufacturing and material handling services, rather than working on a consignment basis in which the customer supplies all materials and the contract manufacturer supplies only labor.Turn-key contracts involve design, manufacturing and engineering support, procurement of all materials, and sophisticated in-circuit and functional testing and distribution.The manufacturing partnership between customers and contract manufacturers involves an increased use of “just-in-time” inventory management techniques that minimize the customer’s investment in component inventories, personnel, and related facilities, thereby reducing their costs. Based on the trends observed in the contract-manufacturing industry, one of our goals is to benefit from the increased market acceptance of, and reliance upon, the use of manufacturing specialists by many original equipment manufacturers, or OEMs, marketing firms, distributors, and national retailers.We believe the trend towards outsourcing manufacturing will continue.OEMs use manufacturing specialists for many reasons, including reducing the time it takes to bring new products to market, reducing the initial investment required, accessing leading manufacturing technology, gaining the ability to better focus resources in other value-added areas, and improving inventory management and purchasing power.An important element of our strategy is to establish partnerships with major and emerging OEM leaders in diverse segments across the electronics industry.Due to the costs inherent in supporting customer relationships, we focus our efforts on customers with which the opportunity exists to develop long-term business partnerships.Our goal is to provide our customers with total manufacturing solutions for both new and more mature products, as well as across product generations - an idea we call “Concept to Consumer.” During 2011, we closed our dedicated office in Bentonville, Arkansas, in an effort to reduce costs. Through CirTran-Asia, we design, engineer, manufacture, and supply products in the international electronics, consumer products, and general merchandise industries for various marketers, distributors, and retailers selling overseas.This subsidiary provides manufacturing services to the direct-response and retail consumer markets.Our experience and expertise in manufacturing enables CirTran - Asia to enter a project at various phases: engineering and design; product development and prototyping; tooling; and high-volume manufacturing.This presence with Asian suppliers helps us maintain an international contract manufacturer status for multiple products in a wide variety of industries and has allowed us to target larger-scale contracts. 6 We intend to pursue manufacturing relationships beyond printed circuit board assemblies, cables, harnesses, and injection-molding systems by establishing complete “box-build” or “turn-key” relationships in the electronics, retail, and direct consumer markets. We have developed several fitness and exercise products and products in the household and kitchen appliances and health and beauty aids markets that are manufactured in China.Sales of these products comprised approximately 4% and 1% of revenues reported in 2011 and 2010, respectively.We anticipate that offshore contract manufacturing will play an increased role moving forward as resources will become available to us. Marketing and Media CirTran Online [No 2011 revenue] Prior to 2011, CirTran Online sold products via the Internet to offer training, software, marketing tools, web design and support, and other e-commerce related services to entrepreneurs and to telemarket directly to customers.As part of CirTran Online’s business plan, we entered into an agreement with Global Marketing Alliance (“GMA”), an [unaffiliated] Utah limited liability company specializing in providing services to eBay sellers, conducting Internet marketing seminars, and developing and hosting web sites.We had no revenues from this segment during 2011. We remain capable of providing product marketing services to the direct-response and retail markets for both proprietary and nonproprietary products to provide campaign management and marketing services for both the direct-response retail and beverage distribution markets.We also provide marketing and media services to support our own product efforts, and we offer marketing service in channels involving television, radio, print media, and the Internet to our customers. We previously anticipated that our sales office in Bentonville, Arkansas, in close proximity to Wal-Mart’s world headquarters, would enable us to create and manage an ongoing relationship with Wal-Mart, Sam’s Club, and other retailers, in order to facilitate the distribution of products through those channels.With the closure of this sales office during 2011, those activities have been suspended. Electronics Assembly CirTran USA [No 2011 revenue] In previous years, we provided a mix of high- and medium-volume, turn-key manufacturing services using surface-mount technology, ball-grid array assembly, pin-through-hole, and custom injection-molded cabling for leading electronics OEMs in the communications, networking, peripherals, gaming, law enforcement, consumer products, telecommunications, automotive, medical, and semiconductor industries.Our services included pre-manufacturing, manufacturing, and post-manufacturing services.Our goal was to offer our customers the significant competitive advantages that could be obtained from manufacture outsourcing, such as access to advanced manufacturing technologies, shortened product time-to-market, reduced cost of production, more effective asset utilization, improved inventory management, and increased purchasing power. During 2010, we entered into certain agreements with Katana Electronics, LLC (“Katana”), related to realignment of our legacy electronic manufacturing business.In so doing, we transferred our rights and responsibilities to our open and active purchase orders relating to our legacy electronics contract manufacturing business to Katana (which leases equipment).Accordingly, our electronics assembly segment was suspended during 2010. 7 Racore Network, Inc. Through our Racore subsidiary, we are capable of providing engineering design services to customers of some of our other subsidiaries. SALES AND MARKETING We continue to pursue product development and business development opportunities in the beverage and ancillary product distribution and contract manufacturing segments as well as in the marketing and media and electronics assembly segments that would enable us to reactivate those capabilities. We intend to continue pursuing sales representative relationships as well as internal salaried sales executives.If PlayBev is able to resolve the licensing dispute with Playboy so that it can expand its beverage distribution activities, we anticipate that these expansion efforts, including perhaps the establishment of additional marketing offices in Los Angeles or elsewhere, will be to support the beverage division and to provide product marketing, production, media funding, and merchandising services to the direct-response and entertainment industries. We are working aggressively to market existing products through current sales channels.We also seek new paths to deliver products and services directly to end users, as well as motivate our distributors, partners, and other third-party sales mechanisms.We continue to simplify and improve the sales, order, and delivery process.We are also pursuing strategic relationships with retail distribution firms to engage with us in a reciprocal relationship whereby they would act as our retail distribution arm and we would act as their manufacturing arm, with both parties giving the other priority and first opportunity to work on the other’s products. Historically, we have had substantial recurring sales from existing customers.With the growth of the beverage distribution sales before the PlayBev licensing dispute arose in 2011, we were rapidly gaining new customers, both domestically and internationally.We consider sales and marketing as an integrated process involving direct salespersons and project managers, as well as senior executives.We use independent sales representatives in certain geographic areas and engage consulting groups to make strategic introductions to generate new business. In 2011, 13.4% of our net sales were derived from new customers, whereas during 2010, 9% of our net sales were sourced from new customers.The increase in new customer sales was caused by opening new national and international beverage territories.During 2011, nearly 100% of the sales from recurring customer sales were related to sales of Playboy energy drinks.We anticipate beverage-related sales and services to continue providing the majority of our net sales. Our expansion into manufacturing in China has allowed us to increase our manufacturing capacity and output with minimal capital investment required.By using various subcontractors, we leverage our upfront payments for inventories and tooling to control costs and receive benefits from economics of scale in Asian manufacturing facilities.These expenses can be upwards of $100,000 per product.Typically, and depending on the contract, we will prepay some factories anywhere from 10% to 50% of the purchase orders for materials.In exchange for theses financial commitments, we receive dedicated manufacturing responsiveness and eliminate the costly expense associated with capitalizing completely proprietary facilities.In addition, we have expanded our manufacturing capabilities for our beverage division outside the United States to accommodate customers located in Europe.In 2010, we contracted with a manufacturer in Budapest, Hungary, and in early 2011, in India to accommodate its distributor in those areas. 8 We have beverage contracts that require minimum quantity purchase orders over periods terminating between 2011 and 2021.If the full minimum quantity orders are purchased under these current agreements, they would generate upwards of $500,000,000 in revenues to us.The majority of these international distribution contracts are based on minimum orders they are required to purchase during the term of the contract to maintain their rights to sell the Playboy Energy Drink.Revenue under these contracts is not recognized until ordered products have been shipped.There is no assurance, except for the upfront deposits, that the parties to these agreements will meet their obligations for the minimum quantity or any level of purchases required under their respective agreements. During a typical contract manufacturing sales process, a customer provides us with specifications for the product it wants, and we develop a bid price for manufacturing a minimum quantity that includes manufacture engineering, parts, labor, testing, and shipping.If the bid is accepted, the customer is required to purchase the minimum quantity, and additional product is sold through purchase orders issued under the original contract.Special engineering services are provided at either an hourly rate or at a fixed contract price for a specified task. COMPETITION Beverage Distribution The beverage industry is highly competitive.Our energy drinks compete with others in the marketplace in terms of pricing, packaging, development of new products and flavors, and marketing campaigns.These products compete with a wide range of drinks produced by a relatively large number of manufacturers, most of which have substantially greater financial, marketing, and distribution resources than we have.In an effort to protect against dependence on a single source supplier, we have established multiple beverage manufacturing facilities in strategic locations. We believe that factors affecting our ability to compete successfully in the beverage industry include taste and flavor of products, strong recognition of the Playboy brand and related branded product advertising, industry and consumer promotions, attractive and different packaging, and pricing.We also compete for distributors; most of our distributors also sell products manufactured by our competitors, and we will compete for the attention of these distributors to endeavor to sell our products ahead of those of our competitors, provide stable and reliable distribution, and secure adequate shelf space in retail outlets.These and other competitive pressures in the energy beverage category could cause our products to be unable to gain or to lose market share or we could experience price erosion, which could have a material adverse affect on our business and results. We compete not only for consumer acceptance, but also for maximum marketing efforts by multi-brand licensed bottlers, brokers, and distributors, many of which have a principal affiliation with competing companies and brands.Our products compete with all liquid refreshments and with products of much larger and substantially better financed competitors, including the products of numerous nationally and internationally known producers such as Hansen’s Energy, Diet Red, Monster Energy, Lost Energy, Joker Mad Energy, Ace Energy, Unbound Energy, Rumba energy juice, Red Bull, Rockstar, Full Throttle, No Fear, Amp, Adrenaline Rush, 180, Extreme Energy Shot, Red Devil, Rip It, NOS, Boo Koo, Vitaminenergy, and many other brands.We also compete with companies that are smaller or primarily local in operation.Our products also compete with private label brands such as those carried by grocery store chains, convenience store chains, and club stores. 9 Contract Manufacturing We believe that the primary basis of competition in our targeted markets is manufacturing technology, quality, responsiveness, the provision of value-added services, and price.To remain competitive, we must continue to provide technologically advanced manufacturing services, maintain quality levels, offer flexible delivery schedules, deliver finished products on a reliable basis, and compete favorably on the basis of price. The electronic manufacturing services industry is large and diverse and is serviced by many companies, including several that have achieved significant market share.Because of our market’s size and diversity, we do not typically compete for contracts with a discreet group of competitors.We compete with different companies depending on the type of service or geographic area.Certain of our competitors have greater manufacturing, financial, research and development, and marketing resources.We also face competition from current and prospective customers that evaluate our capabilities against the merits of manufacturing products internally. REGULATION We are subject to typical federal, state, and local regulations and laws governing the operations of manufacturing concerns, including environmental disposal, storage and discharge regulations and laws, employee safety laws and regulations, and labor practices laws and regulations.We are not required under current laws and regulations to obtain or maintain any specialized or agency-specific licenses, permits, or authorizations to conduct our manufacturing services.We believe we are in substantial compliance with all relevant regulations applicable to our business and operations.All international sales permits are the responsibility of the local distributors and they are required to obtain all local licenses and permits. EMPLOYEES As of April 16, 2012, we employed a total staff of 11 full-time employees in the United States.In addition, we employ employees through contract services to provide promotional activities in the United States.In our Salt Lake headquarters, we employ five persons: three in administrative and clerical positions and one each in sales and project management. We believe that our relationship with our employees is good. CORPORATE BACKGROUND AND HISTORY In 1987, CirTran Corporation was incorporated in Nevada under the name Vermillion Ventures, Inc., for the purpose of acquiring other operating corporate entities.We were largely inactive until July 1, 2000, when our wholly owned subsidiary, CirTran Corporation (Utah) acquired substantially all of the assets and certain liabilities of Circuit Technology, Inc. Our predecessor business in Circuit Technology, Inc., was commenced in 1993 by our president, Iehab Hawatmeh.In 2001, we effected a 15-for-1 forward-split of our shares and a stock distribution, which increased the number of our issued and outstanding shares of common stock.We also increased our authorized capital from 500,000,000 to 750,000,000 shares.In 2007, our shareholders approved a 1.2-for-1 share forward split and an amendment to our Articles of Incorporation that increased our authorized capital to 1,500,000,000 shares of common stock.In August 2011, we increased our authorized capitalization to 4,500,000,000 shares of common stock, par value $0.001. 10 AVAILABLE INFORMATION Federal securities laws require us to file information with the Securities and Exchange Commission (“SEC”) concerning our business and operations.Accordingly, we file annual, quarterly, and interim reports, and other information with the SEC.You can inspect and copy this information at the public reference facility maintained by the SEC at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, and Washington, D.C. 20549.You can get additional information about the operation of the SEC’s public reference facilities by calling the SEC at 1-800-SEC-0330.The SEC also maintains a web site (http://www.sec.gov) at which you can read or download our reports and other information. Our Internet addresses are www.cirtran.com, www.playboyenergy.com and www.racore.com.Information on our websites is not incorporated by reference herein.We make available free of charge through our corporate website, www.cirtran.com, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. ITEM 1A.RISK FACTORS In addition to the negative implications of all information and financial data included in or referred to directly in this periodic report, you should consider the following risk factors.This periodic report contains forward-looking statements and information concerning us, our plans, and other future events.Those statements should be read together with the discussion of risk factors set forth below, because those risk factors could cause actual results to differ materially from such forward-looking statements. We may be deemed to be insolvent and may face liquidation. We may be deemed to be insolvent.We are unable to meet all of our obligations as they accrue, and the aggregate amount of our liabilities may exceed the value of our assets.Creditors may have the right to initiate involuntary bankruptcy proceedings against us in which they would seek our liquidation.We cannot assure that we would be successful in efforts to avoid liquidation by converting such liquidation proceedings to a Chapter 11 reorganization to permit us to develop and propose for creditor approval a reorganization plan that would enable us to proceed.Even if we were to be able to propose a reorganization plan, any such reorganization plan would likely require that we obtain new post-petition funding, which may be unavailable.Further, in the event of a bankruptcy filing, our secured creditors that have encumbrances on all of our assets would likely execute and take all of our assets, which likely would leave nothing for other creditors or the shareholders. The auditors’ report for our most recent fiscal year, like previous years, contains an explanatory paragraph about our ability to continue as a going concern. We had a net loss of $7.0 million during 2011 and an accumulated deficit of $48.3 million as of December 31, 2011.In addition, during 2011 we used cash of $320,115 in our operations.We have borrowed funds in the form of short-term advances, notes, and convertible debentures with an aggregate outstanding balance of $8.3 million as of December 31, 2011.We had a negative working capital balance of $25.5 million as of December 31, 2011.The report of our auditors on our consolidated financial statements for the years ended December31, 2011 and 2010, contains an explanatory paragraph about our ability to continue as a going concern. 11 Our ability to continue energy drink distribution, our principal source of revenue, is subject to interruption or termination because of PlayBev’s ongoing Chapter 11 reorganization proceedings and disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks. Playboy has sought in PlayBev’s Chapter 11 reorganization proceedings to terminate PlayBev’s license to market Playboy-licensed energy drinks.We cannot assure that Playboy’s current willingness to discuss a possible settlement rather than aggressively pursue a judicial determination will continue.If the Playboy licensing dispute is not resolved satisfactorily through a negotiated settlement or litigation in such proceeding, PlayBev would be required to terminate its beverage distribution activities, which are currently the source of our principal revenues.Such termination may require us to cease our activities and seek protection from creditors. Our interest in PlayBev may be diluted if we raise capital to fund expansion of our energy drink distribution segment. If PlayBev is able to resolve the Playboy licensing dispute through a negotiated settlement, PlayBev would likely need to seek substantial external capital to fund an accelerated and expanded marketing and distribution effort. We cannot assure that such efforts would be successful.Any new funding provided to PlayBev would likely reduce our percentage equity interest in PlayBev. All of our assets are encumbered to secure the payment of an aggregate of $5.9 million in indebtedness that requires substantial monthly payments, and our default could result in the loss of all of our assets. We have encumbered all of our assets to secure the payment of approximately $4.1 million in indebtedness due YA Global Investments, L.P., or YA Global,” which requires payments of $25,000 per month through June 2012, $50,000 per month during July through September 2012, $75,000 in October and November 2012, and $100,000 per month through May 2013, with monthly payments increasing thereafter and with the balance due in January 2014.We also have to meet certain financial and operating covenants in order to avoid default under our obligation to YA Global. We have placed a second encumbrance on all of our assets, subject to the priority encumbrance of YA Global, to secure the payment of approximately $1.8 million in indebtedness due Advanced Beauty Solutions, LLC, or “ABS,” which requires monthly payments of $7,500 per month through December 2015 ($15,000 in December 2012), with the balance due in January 2016. The obligations due these creditors would have to be paid in order to avoid default, notwithstanding the claims of our trade and other unsecured creditors or the results of our operations.Because of our limited revenues and access to alternative sources of capital, we cannot assure that we will be able to meet these monthly obligations timely. If we were to default in any payment, YA Global and ABS could exercise their remedies, including the execution on all of our assets, which would result in the termination of our activities.We cannot assure that either YA Global or ABS would consider or agree to any forbearance from aggressive collection efforts.The existence of these secured obligations will likely significantly impair our ability to obtain capital from external sources. We are parties to numerous lawsuits that require significant management attention and funds for attorney’s fees and subject us to risks of damages or other adverse judgments. As noted in Item 3. Legal Proceedings, we are a party to numerous lawsuits, some of which remain active, requiring that we incur attorney’s fees and other costs and devote management time and attention. 12 Litigation respecting the status of the PlayBev license to market Playboy-licensed energy drinks places the validity of that license at issue and may result in termination of that license, which is the principal source of our revenue.Successful suits by creditors for the collection of debts may require that we pay judgment amounts, subject to the priority encumbrances in favor of secured creditors.We may incur significant costs to pursue litigation in which we are the plaintiff without any recovery or other favorable outcome. Any judgments we may obtain against third parties may not be collectible. We will require substantial amounts of additional capital from external sources. Whether or not the Playboy licensing dispute being litigated in the PlayBev Chapter 11 reorganization proceeding reaches a negotiated settlement, we will require substantial additional funds to implement our marketing plan and pursue expansion of our beverage distribution business segment.The extent of our future capital requirements will depend on many factors, including the financial requirements under a Playboy licensing arrangement; marketing plans; the growth of contract manufacturing; establishment of strategic alliances, joint ventures, or other collaborative arrangements; and other factors not within our control.We anticipate that we will seek required funds from external sources.However, our precarious financial condition, limited revenues, substantial secured indebtedness, continuing lawsuits, and uncertainties respecting the status of the PlayBev license to market Playboy-licensed energy drinks will make it difficult for us to obtain such capital. We may seek required funds through the sale of equity or other securities.Our ability to complete an offering on acceptable terms will depend on many factors, including the condition of the securities markets generally and for companies such as us at the time of such offering; the business, financial condition, and prospects at the time of the proposed offering; our ability to identify and reach a satisfactory arrangement with prospective underwriters; and various other factors, many of which are outside our control.There can be no assurance that we will be able to complete an offering on terms favorable to us or at all.The issuance of additional equity securities may dilute the interest of our existing shareholders or may subordinate their rights to the superior rights of new investors. In October 2011, PlayBev issued a $1.5 million capital call, of which only approximately $469,000 was provided.It may continue to seek the balance of such financing as well as additional capital to fund its Chapter 11 reorganization. We may also seek additional capital through strategic alliances, joint ventures, or other collaborative arrangements.Any such relationships may dilute our interest in any specific project and decrease the amount of revenue that we may receive from such project.There can be no assurance that we will be able to negotiate any strategic investment or obtain required additional funds on acceptable terms, if at all.In addition, our cash requirements may vary materially from those now planned because of the results of future research and development; results of product testing; potential relationships with our strategic or collaborative partners; changes in the focus and direction of our research and development programs; competition and technological advances; issues related to patent or other protection for proprietary technologies; and other factors. If adequate funds are not available, we may be required to delay, reduce the scope of, or eliminate our planned marketing efforts; to obtain funds through arrangements with strategic or collaborative partners that may require us to relinquish rights to certain of our technologies, product candidates, or products that we would otherwise seek to develop or commercialize ourselves; or to license our rights to such products on terms that are less favorable to us than might otherwise be available. 13 Any substantial increase in sales will require skilled management of growth. If we have the opportunity to expand our operations, our success will depend on our ability to manage continued growth, including integration of our executive officers, directors, and consultants into an effective management and technical team; to formulate strategic alliances, joint ventures, or other collaborative arrangements with third parties; to commercialize and market our proposed products and services; and to monitor and manage these relationships on a long-term basis.If our management is unable to integrate these resources and manage growth effectively, the quality of our products and services, our ability to retain key personnel, and the results of our operations would be materially and adversely affected. We cannot predict the impact on our activities of the current economic crises. The current economic crises have adversely affected and will likely continue to adversely affect our ability to expand or generate new sales.We may be unable to expand sales in a constricted or further constricting economy. We are authorized to issue substantial additional shares of stock, which would dilute the ownership of our stockholders. We have authorized 4,500,000,000 shares of common stock, of which 1,839,302,289 shares of common stock are issued and outstanding as of the date of this report.Our board of directors has the authority, without action or vote of the shareholders, to issue all or part of the authorized but unissued shares.Any such issuance will dilute the percentage ownership of shareholders and may further dilute the book value of the shares of common stock. Penny stock regulations will impose certain restrictions on resales of our securities, which may cause an investor to lose some or all of its investment. The Securities and Exchange Commission has adopted regulations that generally define a “penny stock” to be any equity security that has a market price (as defined) of less than $5.00 per share that is not traded on a national securities exchange or that has an exercise price of less than $5.00 per share, subject to certain exceptions.As a result, our common stock is subject to rules that impose additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers and accredited investors (generally those with assets in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together with their spouse).For transactions covered by these rules, the broker-dealer must make a special suitability determination for the purchase of such securities and have received the purchaser’s written consent to the transaction prior to the purchase.Further, if the price of the stock is below $5.00 per share and the issuer does not have $2.0 million or more net tangible assets or is not listed on a registered national securities exchange, sales of such stock in the secondary trading market are subject to certain additional rules promulgated by the Securities and Exchange Commission.These rules generally require, among other things, that brokers engaged in secondary trading of penny stocks provide customers with written disclosure documents, monthly statements of the market value of penny stocks, disclosure of the bid and asked prices, and disclosure of the compensation to the broker-dealer and the salesperson working for the broker-dealer in connection with the transaction.These rules and regulations may affect the ability of broker-dealers to sell our common stock, thereby effectively limiting the liquidity of our common stock.These rules may also adversely affect the ability of persons that acquire our common stock to resell their securities in any trading market that may exist at the time of such intended sale. 14 ITEM 1B.UNRESOLVED STAFF COMMENTS None. ITEM 2.PROPERTIES On May 4, 2007, we entered into a ten-year lease agreement for our existing 40,000 square-foot headquarters and manufacturing facility, located at 4125 South 6000 West in West Valley City, Utah.Monthly payments are $10,000, adjusted annually in accordance with the Consumer Price Index.The Premises include 10,000 square feet of office space to support administration, sales, and engineering staff and 30,000 square feet of manufacturing space, which includes a secured inventory area, shipping and receiving areas, and manufacturing and assembly space. In 2010, we subleased to Katana Electronics, LLC, approximately 32,000 square feet of our West Valley City, Utah facility, consisting of the warehouse, electronics product manufacturing and assembly area, and office space used as of the close of business on March 4, 2010, for our legacy electronics manufacturing business. The sublease continued on a month-to-month basis at a base rent of $8,500 per month.The sublease contained normal and customary use restrictions, indemnification rights and obligations, default provisions, and termination rights. On June 30, 2011, the Company’s lease agreement was terminated for the Company's existing 40,000 square-foot headquarters and manufacturing facility, located at 4125 South 6000 West in West Valley City, Utah. On July 1, 2011, Katana signed a new lease agreement with the building’s owner and the Company has agreed to pay Katana $5,000 per month for the use of office space and utilities. We believe that the facilities and equipment described above are generally in good condition, are well maintained, and are suitable and adequate for our current and projected operating needs. ITEM 3.LEGAL PROCEEDINGS We are a party to the following material legal proceedings. Advanced Beauty Solutions, LLC v. CirTran Corporation, Case No. 1:08-ap-01363-GM. In connection with our prior litigation with Advanced Beauty Solutions, or ABS, it claimed nonperformance by us and filed an adversary proceeding in its bankruptcy case proceeding in the United States Bankruptcy Court, Central District of California, San Fernando Valley Division.On March 17, 2009, the Bankruptcy Court entered judgment in favor of ABS and against us in the amount of $1,811,667, plus interest.On September 11, 2009, the Bankruptcy Court denied our motion to set aside the judgment. 15 On September 8, 2010, we executed an Assignment of Copyrights, thereby assigning our Copyright Registration No. TX-6-064-955, Copyright Registration No. TX-6-064-956, and Copyright to the True Ceramic Pro - Live Ops (TCPS) infomercial and related master tapes (collectively the “Copyrights”) to ABS, without reservation or exclusion, making ABS the owner of the Copyrights. On February 23, 2011, we filed a Motion to Declare Judgment Fully Satisfied or Alternatively to Recoup Mutual Debts, requesting that the court determine that our assignment of the Copyrights resulted in full satisfaction of the ABS judgment.On March 3, 2011, ABS brought a Motion for Order to Show Cause re Civil Contempt alleging that we had failed to make payments on ABS’s judgment in violation of the court’s orders.At the hearing on April 6, 2011, the court denied our motion to declare the judgment fully satisfied and granted ABS’s motion, but did not hold us in civil contempt.The court also set a hearing on the ABS motion for the order to show cause for July 8, 2011, regarding our compliance with collection orders, which the parties stipulated should be postponed until August 3, 2011.The parties attended mediation on July 11, 2011, but no formal settlement resulted.At the hearing in August, the court found that a basis existed to hold us in contempt and set an evidentiary hearing for October 6, 2011, to determine whether to issue a contempt citation.We appealed the denial of the motion to declare judgment satisfied. On March 22, 2012, we entered into a formal forbearance agreement with ABS, dated as of March 1, 2012 (the “ABS Forbearance Agreement”), whereby ABS agreed to take no further judgment enforcement actions in consideration of the payment of $25,000 upon execution of the definitive ABS Forbearance Agreement and satisfaction of applicable conditions precedent.The ABS Forbearance Agreement calls for us to pay $7,500 per month for 46 consecutive months (except for a payment of $15,000 in December 2012), commencing in March 2012, with the unpaid balance, as finally determined as provided below, due and payable in January 2016.No interest on the principal would accrue unless the note is in default, in which case, it would bear interest at 10% per annum from the date of the ABS Forbearance Agreement.In addition, we stipulated to an additional judgment for attorney’s fees incurred in negotiating the ABS Forbearance Agreement and entering into the related definitive agreements and in related post-judgment collection efforts.The obligation to pay $1,835,000 under the ABS Forbearance Agreement would be secured by an encumbrance on all of our assets, subject to the prior lien and encumbrance in favor of YA Global. The principal amount of $1,835,000 due under the ABS Forbearance Agreement would be reduced by the greater of the amount of credit granted in the bankruptcy proceedings for the value of the intellectual property we previously conveyed to ABS and the amount received by ABS from the sale of such intellectual property to a third party during the term of the ABS Forbearance Agreement, plus the amount of any distribution to which we are entitled as a creditor of ABS, provided, however, that in no event would the amount due under the ABS Forbearance Agreement be reduced below $90,000, which is the amount payable during the first 12 months under the ABS Forbearance Agreement.ABS entered into a subordination agreement subordinating the obligation under the ABS Forbearance Agreement in favor of the obligations and first-priority security interest of YA Global.We conveyed to ABS the trademarks and intellectual property previously conveyed by ABS to us.We have accrued a balance of $90,000 for the minimum required payment under the ABS Forbearance Agreement. Our appeal of the approximately $1.8 million judgment has been remanded in the ABS bankruptcy proceedings to conclusively determine the amount of credit due us for the conveyance of the intellectual property.Except for the determination of the fair market value of the intellectual property and any enforcement or collection proceedings that may be required under the ABS Forbearance Agreement, all litigation and disputes between ABS and its affiliates, on the one hand, and us and our affiliates, on the other hand, would be dismissed, including the pending order to show cause regarding contempt against us, our subsidiaries, and Iehab Hawatmeh. 16 We have assigned to ABS our creditor claim against the estate of ABS, to the extent of the balance due under the ABS Forbearance Agreement.Any distribution from the ABS estate in excess of the adjusted amounts due under the ABS Forbearance Agreement will be paid to us. YA Global Investments, LP v. CirTran Corporation, Third Judicial District Court of Salt Lake County, State of Utah, case no. 100911400. On June 25, 2010, YA Global filed a lawsuit against us asserting claims for breach of contract, breaches of the uniform commercial code, and replevin.YA Global seeks a judgment in the amount of $4,193,380, plus interest and attorneys fees, as well as a writ of replevin to compel us to turn over equipment and other property that YA Global claims was pledged as collateral to secure obligations owing to YA Global.We do not dispute that we are indebted to YA Global in the amount of $3,161,355, plus interest, but we deny that we are in breach of our payment obligations because YA Global agreed to restructure the payment schedule and we relied on this agreement. On January 24, 2011, we entered into a forbearance agreement with YA Global, including a confession of judgment in its favor.On February 23, 2011, the court entered judgment based on the confession of judgment against us in the principal amount of $3,161,355, plus interest of $825,858. On July 22, 2011, YA Global filed a motion in the ABS lawsuit (discussed above) seeking an order clarifying its position with respect to ABS and staying enforcement of that court’s order that we pay approximately $35,000 in legal fees to ABS.In its motion, YA Global notified us that it intended to conduct a secured party’s public auction of all of our assets.YA Global also informed us that we had defaulted under our January 2011 Forbearance Agreement and declared that all of our obligations to YA Global were immediately due and owing.Further, YA Global stated that it intended to commence action to collect on our obligations and instructed us to assemble the assets. At a hearing held on August 3, 2011, in the ABS reorganization proceeding referred to above on YA Global’s motion to stay enforcement, YA Global noted that the date of the proposed secured party’s public auction was August 30, 2011.At the same time, YA Global notified us that the proposed sale of assets would be held on August 30, 2011. At the hearing in the ABS matter, the Bankruptcy Court denied YA Global’s motion to stay the payment of attorneys’ fees by us.Subsequently, the parties to the January 2011 settlement with YA Global entered into an agreement whereby YA Global agreed to cancel the proposed asset sale without waiver. On September 30, 2011, YA Global directed us to assemble the collateral in order to enable it to take possession on or before October 6, 2011.Following negotiations with YA Global, we confirmed our indebtedness to YA Global and arranged for it to take possession of collateral on October 17, 2011, on which date, all accounts receivable, collections, and other proceeds and products of the collateral would be held in trust by us for YA Global and immediately forwarded to it.Before we were required to surrender possession of the collateral, we initiated negotiations to obtain YA Global’s forbearance from collection. 17 On March 22, 2012, we entered into a formal forbearance agreement with YA Global, dated as of March 1, 2012 (the “2orbearance Agreement”) in which we ratified our previous obligations under the debentures and agreed to pay the debentures, $25,000 at signing the 2orbearance Agreement, $25,000 per month in March through June 2012, $50,000 per month in July through September 2012, $75,000 in the months of October and November 2012, $100,000 per month in the months of December 2012 through May 2013, $125,000 per month in the months of June through December 2013, and the balance in December 2014 (the “Termination Date”). In addition to the above minimum payments to YA Global, we are required to pay monthly excess cash flow, to the extent cumulatively available, consisting of consolidated earnings before interest, taxes, depreciation and amortization, less cash deposits for product orders received but not yet shipped, actual cash taxes paid, actual cash principal and interest paid, and reasonable out-of-pocket cash paid together with reasonable cash reserves in an amount not to exceed 5% of total net sales, provided that such excess cash flow payments shall not to exceed $50,000 in March 2012 and $25,000 per month in April 2012 and thereafter, until the balance is paid. As of December 31, 2011, the balance due YA Global was $3,161,355 in principal plus $856,546 in accrued interest. We continue to have the right, subject to the consent of YA Global, to pay all or any portion of the payments listed above in common stock, with the conversion price to be used to determine the number of shares being equal to the lowest closing bid price of our common stock during the 20 trading days prior to the payment date.The amount applied as a payment on the note and accrued interest will be adjusted to the value of the actual proceeds from the sale of the stock. YA Global agreed to forbear from enforcing its rights and remedies as a result of the existing defaults and/or converting the debentures into shares of our common stock, until the earlier of our default under the 2orbearance Agreement or the Termination Date. In re Play Beverages, LLC, United States Bankruptcy Court for the District of Utah, Case No. 11-26046, and related matters. On April 26, 2011, three alleged creditors, LIB-MP Beverage, LLC, George Denney, and Warner K. Depuy, filed an involuntary Chapter 7 petition against Play Beverages, LLC, a consolidated entity of our subsidiary (“PlayBev”), seeking its liquidation.Thereafter, management decided that reorganizing PlayBev as a debtor-in-possession under Chapter 11, of Title 11, of the United States Bankruptcy Code, was in the best interests of PlayBev and its creditors and equity holders.Accordingly, on August 12, 2011, PlayBev consented to the entry of an order for relief in the pending involuntary bankruptcy case and immediately exercised its right under Section 706(a) of the Bankruptcy Code to convert the case to a voluntary Chapter 11 reorganization case.That same day, the court entered an Order for Relief under Chapter 11 based on PlayBev’s elections.PlayBev is now a debtor-in-possession and intends to propose and confirm a plan of reorganization. Playboy Enterprises International, Inc. (“Playboy”), has filed a motion to terminate the automatic stay to permit it to terminate a Product License Agreement between it and PlayBev.PlayBev contested the motion, and before the hearing was held, Playboy stipulated to suspend all litigation between the parties while they explore the possibility of a mutually beneficial settlement of their disputes.At this time, there are no motions or other matters scheduled for hearing. PlayBev continues to negotiate with its creditors and is formulating a plan of reorganization.PlayBev also continues to negotiate with Playboy regarding assumption of its Product License Agreement. General Distributors, Inc. v. Iehab Hawatmeh and CirTran Beverage Corp. d/b/a Play Beverages LLC d/b/a Playboy Beverages, in the Circuit Court of the State of Oregon, for the County of Clackamas, Case No. CV 10110087. On November 8, 2010, General Distributors, Inc., filed a complaint asserting claims for breach of contract, liability under the Uniform Commercial Code, quasi contract - unjust enrichment, goods sold and delivered, account stated, and attorneys fees and seeking judgment in the amount of $49,999, plus interest and attorneys fees.We and the other defendants have answered the complaint and denied liability.Because of the effect of the automatic stay in connection with the In Re Play Beverages, LLC bankruptcy matter (discussed above), the litigation in this matter has been stayed. We do not consider it necessary to accrue a liability for the potential liability. 18 Playtime Distributing of Oklahoma LLC v. CirTran Corporation, CirTran Beverage Corporation, and Play Beverages LLC, in the District Court of Oklahoma County, State of Oklahoma, Case No. CJ-2010-1058. On December 30, 2010, Playtime Distributing of Oklahoma LLC filed suit asserting claims for breach of a distribution agreement, bad faith breach of a distribution agreement, rescission of the distribution agreement, accounting, breach of an independent sales agreement, bad faith breach of an independent sales agreement, and punitive damages and seeking judgment in an unspecified amount in excess of $75,000, plus interest and attorneys fees.We and the other defendants have answered and denied liability.Because of the effect of the automatic stay in connection with the In Re Play Beverages, LLC bankruptcy matter (discussed above), the litigation in this matter has been stayed. We do not consider it necessary to accrue a liability for the potential liability. Various Creditor Claims Apex Maritime Co. (LAX), Inc. v. CirTran Corporation, CirTran Asia, Inc., et al., California Superior Court, Los Angeles County, SC098148.Plaintiff Apex Maritime Co. (LAX), Inc., filed a complaint on May 8, 2008, against us and our CirTran - Asia subsidiary claiming breach of contract, nonpayment on open book account, nonpayment of an account stated, and nonpayment for services, seeking approximately $62,000 against us and $121,000 against CirTran - Asia.On March 3, 2009, the court entered its judgment pursuant to the Release and Settlement Agreement.On April 23, 2009, a Judgment Enforcing Settlement was entered against us in the principal amount of $173,000, plus fees of $1,800 and costs of $40.On October 28, 2009, the Third Judicial District Court, District of Utah, West Jordan Department, entered an Order in Supplemental Proceedings, with which we complied.The parties have previously engaged in settlement negotiations.These amounts have been accrued in full as a liability. Global Freight Forwarders v. CirTran Asia, Civil No. 080925731, Third Judicial District Court, Salt Lake County, State of Utah.On December 18, 2008, plaintiff filed a complaint against CirTran - Asia claiming breach of contract, breach of the duty of good faith and fair dealing, and unjust enrichment and seeking approximately $260,000.The parties agreed to settle this matter for $8,000, which CirTran-Asia, Inc., has paid in May 2011. Dr. Najib Bouz v. CirTran Beverage Corp, Iehab Hawatmeh, and Does 1-20, Superior Court for the State of California, County of Los Angeles, Civil No. KC053818.On September 12, 2008, plaintiff filed a complaint seeking a judgment for $52,500, plus attorneys’ fees and certain costs, against CirTran Beverage, Iehab Hawatmeh, and unnamed others, claiming breach of contract and fraud in connection with a certain promissory note.On August 11, 2009, the parties entered into a settlement agreement whereby the claims against Mr. Hawatmeh were dismissed with prejudice, and we agreed to pay Dr. Bouz $63,000 over 12 months.We have made nine monthly payments, but we are in default of the $5,250 monthly payments that were due on May 28, June 28, and July 28, 2010.The judgment has been domesticated in Utah, and Dr. Bouz has begun pursuing collection efforts.These amounts have been accrued in full as a liability. Dr. Paul Bouz v. CirTran Beverage Corp, Iehab Hawatmeh, and Does 1-20, Superior Court for the State of California, County of Los Angeles, Civil No. KC053819.On September 12, 2008, plaintiff filed a complaint seeking a judgment for $52,500, plus attorneys’ fees and certain costs, against CirTran Beverage, Iehab Hawatmeh, and unnamed others, claiming breach of contract and fraud in connection with a certain promissory note.On August 11, 2009, the parties entered into a settlement agreement whereby the claims against Mr. Hawatmeh were dismissed with prejudice, and we agreed to pay Dr. Bouz $63,000 over 12 months.We have made 10 monthly payments, but we are in default of the $5,250 monthly payments that were due on June 28 and July 28, 2010.The judgment has been domesticated in Utah, and Dr. Bouz has begun pursuing collection efforts.These amounts have been accrued in full as a liability. 19 NA CL&D Graphics v. CirTran Beverage Corp., Case No. 09V01154, Circuit Ct, Waukesha County, Wisconsin.On or about March 23, 2009, NA CL&D Graphics filed an action in the above court alleging claims for breach of contract, unjust enrichment, promissory estoppel, and seeking damages of at least $25,488 along with attorneys’ fees and costs.CirTran Beverage is reviewing the matter and intends to defend vigorously against the allegations in the complaint.These amounts have been accrued in full as a liability. Old Dominion Freight Line v. CirTran Corporation, Civil No. 090426290, Third Judicial District Court, Salt Lake County, State of Utah.On May 5, 2010, the court entered an Order in Supplemental Proceedings in connection with a judgment in favor of Old Dominion and against us in the amount of $33,187.The parties agreed to resolve this matter under terms requiring us to pay $20,000 over time.To date, the required payments have not been made.These amounts have been accrued in full as a liability. Jimmy Esebag v. CirTran Corporation and Fadi Nora, Superior Court of the State of California, Los Angeles County, Case No. BC296162.On July 15, 2010, the court entered judgment against us in the amount of $68,270 based upon our failure to make payments when due under a settlement with Mr. Esebag.Mr. Esebag has engaged in some actions to collect on the judgment.These amounts have been accrued in full as a liability. Desiree Liston v. CirTran Media Corp. d/b/a Diverse Media Group Corp., Circuit Court of Benton County, Arkansas, Case No. CV2010-2448-6.On July 28, 2010, Desiree Liston filed a complaint seeking an unspecified amount in excess of $75,000 based on allegations of breach of an employment agreement.Judgment was entered against us on November 28, 2011, for $22,143. Gordon Jensen d/b/a Gordon Jensen Trucking v. CirTran Corp., Third Judicial District Court of Salt Lake County, State of Utah, case no. 108900934.On May 28, 2010, plaintiff brought an action seeking $7,145 for nonpayment of services.Judgment was entered against us on October 7, 2010, for $6,703.These amounts have been accrued in full as a liability. USS Cal Builders, Inc. v. CirTran Beverage Corp., Iehab Hawatmeh, and Fadi Nora, in the Superior Court of the State of California, County of Orange, Case No. 00425093.On November 16, 2010, USS Cal Builders, Inc., filed a complaint asserting various claims and seeking damages of at least $100,000, plus interest, costs, and attorneys fees.We and the individual defendants have answered the amended complaint, denied liability, and intend to defend the claims. We do not consider it necessary to accrue a liability for the potential liability. RDS Touring and Promotions, Inc. v. CirTran Beverage Corp., CirTran Corp., and CirTran Media Corp., in the Superior Court of the State of California, County of Los Angeles, Case No. BC454112.On January 31, 2011, RDS Touring and Promotions, Inc., filed a complaint asserting claims for breach of settlement agreement, fraud in the inducement, and fraud and deceit (false promise).Following a motion filed by us, plaintiffs amended their complaint including only the contract claim.We have answered the amended complaint.Although we do not deny that we are currently in breach of the settlement agreement, there is a dispute as to whether we are obligated under the settlement agreement. These amounts have been accrued in full as a liability. 20 American Express Travel Related Services Company, Inc. v. CirTran Corporation d/b/a Diverse Media Group and Iehab Hawatmeh, in the Third District Court, State of Utah, Salt Lake County.In this action, American Express asserts a claim for $108,029 in principal and $24,269 in interest due on a credit card account.We have answered denying liability and intend to defend the claims. These amounts have been accrued in full as a liability. Ayad Jaber, Ramzy Fakhoury, Haya Enterprises, LLC v. CirTran Beverage Corporation, Play Beverages LLC, Iehab Hawatmeh, and Fadi Nora, in the Superior Court of the State of California, County of Orange, Case No. 0443807.On January 24, 2011, plaintiffs filed a complaint asserting claims based on alleged breaches of various written and oral promises and seeking damages of $700,000 in principal from us, plus $1,219,520 in principal from all defendants, $200,000 from Fadi Nora, and other unspecified amounts.On April 20, 2011, the court entered default judgments against Fadi Nora, Play Beverages, LLC, and us.The default judgments were set aside pursuant to a stipulation and the court granted defendants leave to file an answer, cross complaint, and a motion to recuse opposing counsel.Plaintiffs have opposed the cross complaint.We are seeking to negotiate a settlement of this matter. These amounts have been accrued in full as a liability. Globe Express Services, v. CirTran Beverage Corp., Third District Court, Salt Lake County, Case No. 110914239.In June 2011, we were sued by plaintiff, which seeks approximately $58,000 for services rendered.We did not file a responsive pleading and after December 31, 2011, settled this matter for $15,000, payable in monthly installments of $5,000. The first installment of $5,000 was paid in March 2012. These amounts have been accrued in full as a liability. Alix Technologies v. CirTran d/b/a CirTran Beverage Corp, Third District Court, West Jordan, Case No. 110407015.Plaintiff filed suit in May 2011 claiming that CirTran Beverage had failed to pay for goods, services, or merchandise provided by plaintiff.Defendant filed its answer denying the substantive allegations.CirTran Beverage is reviewing the pleadings and its options and intends to defend against the claims brought. Other Matters United Medical Devices, LLC, v. PlaySafe, LLC, Iehab Hawatmeh, and Fadi Nora, Superior Court of the State of California, in and for the County of Los Angeles, West District, Case No. SC113081 (“UMD #1”), and PlaySafe, LLC and Play Beverages, LLC, v. United Medical Devices, LLC, United Licensing Group, Jimmy Esebag, Patrick Bertranou, and Does 1 through 50, inclusive,Superior Court of the State of California, in and for the County of Los Angeles, West District, Case No. SC113149 (“UMD #2”).In May 2011, Plaintiffs PlaySafe, LLC (“PlaySafe”) and PlayBeverages, LLC (“PlayBev”), brought suit against United Medical Devices (“UMD”), United Licensing Group (“ULG”), Jimmy Esebag, and Patrick Bertranou in Utah, alleging breach of contract, breach of the covenant of good faith and fair dealing, tortious interference with contract, fraud, and negligent misrepresentation, and seeking damages and punitive damages.That case was dismissed for lack of personal jurisdiction over defendants.Subsequently, in June 2011, UMD sued PlaySafe, PlayBev, Iehab Hawatmeh, and Fadi Nora, alleging breach of contract, fraudulent misrepresentation, promissory fraud, and fraudulent concealment.Also in June 2011, PlaySafe and PlayBev sued UMD, ULG, Esebag, and Bertranou alleging breach of contract, breach of the covenant of good faith and fair dealing, tortious interference with contract, tortious interference with prospective business relationship, fraud/deceit, negligent misrepresentation, and misappropriation of trade secrets.In UMD #1, defendants PlaySafe, PlayBev, and Messrs. Hawatmeh and Nora filed demurrers on all claims except the breach of contract claims.In UMD #2, plaintiffs PlaySafe and PlayBev filed a motion seeking a temporary restraining order requiring defendants to provide products and to cease contacting plaintiffs’ distributor contacts, but it was not granted.UMD #2 has been consolidated into UMD #1 for further proceedings.We are pursuing this litigation, now in discovery, vigorously. 21 Redi FZE v. CirTran Beverage Corp, in the Third District Court, Salt Lake County, State of Utah, Civil No. 110915101.In a complaint filed in June 2011, Redi asserted claims for breach of contract, fraud, and negligent misrepresentations.CirTran Beverage Corp. filed a counterclaim for breach of contract, breach of the covenant of good faith and fair dealing, and a third-party claim for tortious interference against Paul Levin.On November 21, 2011, the court granted an injunction against Redi FZE, enjoining it from manufacturing, marketing, or distributing any nonalcoholic beverages identified by the trademarked Playboy, PlayBev, and Play Beverages names or the Playboy rabbit head design in the United Kingdom, France, or the Netherlands through June 13, 2013.We believe that Redi FZE’s claims are without merit and intend to defend them vigorously. We do not consider it necessary to accrue a liability for the potential liability. Play Beverages, LLC, After Bev Group, LLC,, CirTran Beverage Corporation,, CirTran Corporation, Iehab Hawatmeh, and Fadi Nora v. Warner K Depuy, et al., Third District Court, Salt Lake City, Utah, case no. 100907700.The plaintiffs allege tortuous interference with contractual relations, breaches of fiduciary duty, and fraud and negligent misrepresentations and seek a declaratory judgment determining the rights of the parties, damages to be determined at trial, costs, and attorney’s fees. A default certificate was filed by the plaintiffs for the failure of the defendants to respond and then withdrawn, and there have been no further proceedings. In addition to the foregoing, we are parties to ordinary routine litigation incidental to our business that, individually and in the aggregate, is not material. ITEM 4.MINE SAFETY DISCLOSURES Not applicable. 22 PART II ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded in the over-the-counter market.The following table sets forth for the respective periods indicated the prices of the common stock in the over-the-counter market, as reported and summarized by the OTC Bulletin Board.Such prices are based on inter-dealer bid and asked prices, without markup, markdown, commissions, or adjustments and may not represent actual transactions. Low High 2012: First Quarter (through March 31, 2012) $ $ 2011: Fourth Quarter Third Quarter Second Quarter First Quarter 2010: Fourth Quarter Third Quarter Second Quarter First Quarter As of April 16, 2012, we had approximately 3,000 shareholders. We have not declared any dividends on our common stock since our inception, and do not intend to declare any such dividends in the foreseeable future. Our ability to pay dividends is subject to limitations imposed by Nevada law. Under Nevada law, dividends may be paid to the extent the corporation’s assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business. Recent Sales of Unregistered Securities During the year ended December 31, 2011 we issued 96,329,366 shares of common stock for settlement of $179,494 in accrued liabilities and 184,000,000 shares for settlement of $824,300 in debt and short-term advances During 2011, we accrued to employees and consultants five-year options to purchase 22,400,000 shares of common stock, exercisable between $0.0021 and $0.0030 per share. During 2011, we issued to consultants five year options to purchase 40,000,000 shares of common stock, exercisable at $0.0001. These options were exercised during the year. On January 24, 2011, we issued to YA Global a warrant to purchase 25,000,000 shares of common stock at an exercise price of $0.02 per share, expiring December 2015. 23 In February, 2012, we issued to consultants five year options to purchase 20,000,000 shares of common stock, exercisable at $0.0001. These options were immediately exercised. The options and warrants were issued without registration under the Securities Act of 1933 in reliance on Section 4(2) of that Act and the rules and regulations promulgated thereunder.No underwriter participated in such transactions, and no proceeds were received therefrom. Penny Stock Rules Our shares of common stock are subject to the “penny stock” rules of the Securities Exchange Act of 1934 and various rules under this Act.In general terms, “penny stock” is defined as any equity security that has a market price less than $5.00 per share, subject to certain exceptions.The rules provide that any equity security is considered to be a penny stock unless that security is registered and traded on a national securities exchange meeting specified criteria set by the SEC, authorized for quotation from the NASDAQ stock market, issued by a registered investment company, and excluded from the definition on the basis of price (at least $5.00 per share), or based on the issuer’s net tangible assets or revenues.In the last case, the issuer’s net tangible assets must exceed $3,000,000 if in continuous operation for at least three years, $5,000,000 if in operation for less than three years, or the issuer’s average revenues for each of the past three years must exceed $6,000,000. Trading in shares of penny stock is subject to additional sales practice requirements for broker-dealers that sell penny stocks to persons other than established customers and accredited investors.Accredited investors, in general, include individuals with assets in excess of $1,000,000 or annual income exceeding $200,000 (or $300,000 together with their spouse), and certain institutional investors.For transactions covered by these rules, broker-dealers must make a special suitability determination for the purchase of the security and must have received the purchaser’s written consent to the transaction prior to the purchase.Additionally, for any transaction involving a penny stock, the rules require the delivery, prior to the first transaction, of a risk disclosure document relating to the penny stock.A broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative and current quotations for the security.Finally, monthly statements must be sent disclosing recent price information for the penny stocks.These rules may restrict the ability of broker-dealers to trade or maintain a market in our common stock, to the extent it is penny stock, and may affect the ability of shareholders to sell their shares. ITEM 6.SELECTED FINANCIAL DATA Not required. ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW We manufacture, market, and distribute internationally an energy drink under a license, now in dispute, with Playboy Enterprises, Inc. (“Playboy”), and in the U.S., we provide a mix of high- and medium-volume turnkey manufacturing services and products using various high-tech applications for leading electronics OEMs (original equipment manufacturers) in the communications, networking, peripherals, gaming, law enforcement, consumer products, telecommunications, automotive, medical, and semiconductor industries.Our services include pre-manufacturing, manufacturing, and post-manufacturing services.Our goal is to offer customers the significant competitive advantages that can be obtained from manufacture outsourcing. 24 We are engaged in the following business segments. Beverage Distribution (96% and 85% of total revenue during 2011 and 2010, respectively) CirTran Beverage manufactures, markets, and distributes Playboy-licensed energy drinks in accordance with an agreement we entered into with Play Beverages, LLC, or PlayBev, a consolidated variable interest entity, which holds the Playboy license. Contract Manufacturing (4% and 1% of total revenue during 2011 and 2010, respectively) CirTran Products pursues contract-manufacturing relationships in the U.S. consumer products markets, including licensed merchandise sold in the sports and entertainment markets. CirTran - Asia manufactures and distributes electronics, consumer products, and general merchandise to companies selling in international markets. For the year ended December 31, 2011 we recognized approximately $131,000 of royalty revenue. Marketing and Media (0% and 12% of total revenue during 2011 and 2010, respectively) CirTran Online sells products via the Internet and provides services and support to Internet retailers. CirTran Media provides end-to-end services to the direct-response and entertainment industries. Electronics Assembly (0% and 2% of total revenue during 2011 and 2010, respectively) Cirtran Corporation (“CirTran USA”) provides low-volume electronics assembly activities consisting primarily of placing and attaching electronic and mechanical components on printed circuit boards and flexible (i.e., bendable) cables. During 2011, our activities were significantly restrained by the necessity to devote priority to efforts to obtaining the forbearance of our principal secured and judgment creditors, negotiating to resolve disputes respecting the PlayBev license to market Playboy-licensed energy drinks, defending the numerous lawsuits to which we are a party, and obtaining additional capital.Disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks impaired our ability to establish new distributors, damaged our relationships with existing distributors, and depressed revenues.All of our activities during the year, as in previous years, were adversely affected by our severe shortages of working capital and cash. 25 RESULTS OF OPERATIONS Comparison of Years Ended December 31, 2011 and 2010 Sales and Cost of Sales Net sales for the year ended December 31, 2011, totaled $3,064,438, as compared to $9,044,902 for the year ended December 31, 2010.The decrease is primarily attributable to issues related to PlayBev’s bankruptcy case and the uncertainty created by Playboy in relation to the interference with our beverage distributors and defend against numerous lawsuits.Additionally, disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks decreased revenues.Net sales in the contract manufacturing segment rose $53,637 in the year ended December 31, 2011, as compared to the same period in 2010.Net sales in the marketing and media segment fell by $1,095,086 in 2011 as compared to 2010, due to our suspension of most external marketing activities.Beverage distribution revenue decreased to $2,943,921 for the year ended December 31, 2011, as compared to $7,712,492 for the year ended December 31, 2010.The decrease was driven by disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks which damaged our relationships with existing distributors. Cost of sales, as a percentage of sales, decreased to 36% for the year ended December 31, 2011, as compared to 65% for the prior year ended December 31, 2010.Consequently, the gross profit margin increased to 64% from 35%, respectively, for the same period.The increase in gross profit margin is attributable to an increase in revenues from royalty agreements which have an overall lower cost. The following chart presents comparisons of sales, cost of sales, royalty expense, and gross profit or loss margin generated by our four operating segments, i.e., beverage distribution, contract manufacturing, marketing and media, and electronics assembly during 2011 and 2010: Segment Year Sales Cost of Sales Royalty Expense Gross Loss / Margin Electronics Assembly $ | [
"UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED [DECEMBER 31, 2011] Commission File Number 000-49654 CirTran Corporation (Exact name of registrant as specified in its charter) Nevada 68-0121636 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 4125 South 6000 West West Valley City, Utah (Address of principal executive offices) (Zip Code) (801) 963-5112 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Exchange Act: Title of each class Name of each exchange on which registered n/a n/a Securities registered pursuant to Section 12(g) of the Exchange Act: Common Stock, Par Value $0.001 (Title of Class) Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act.Yes¨Nox Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act.¨ Indicate by check mark whether the registrant: (1)has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days.YesxNo¨ Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).YesxNo¨ Indicate by check mark if disclosure of delinquent filers in response to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.¨ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.",
"Large accelerated filer o Accelerated filer ¨ Non-accelerated filer o Smaller reporting company x Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes¨Nox State the aggregate market value of the voting and nonvoting common equity held by nonaffiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.As of June 30, 2011, the aggregate market value of the voting and nonvoting common equity held by nonaffiliates of the issuer was $4,126,020. Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.As of March 29, 2012, issuer had 1,839,302,289 shares of issued and outstanding common stock, par value $0.001.",
"DOCUMENTS INCORPORATED BY REFERENCE:None. TABLE OF CONTENTS Part I Page Item 1 Business 3 Item 1A Risk Factors 11 Item 1B Unresolved Staff Comments 15 Item 2 Properties 15 Item 3 Legal Proceedings 15 Item 4 Mine Safety Disclosures 22 Part II Item 5 Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 23 Item 6 Selected Financial Data 24 Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations 24 Item 7A Quantitative and Qualitative Disclosures about Market Risk 33 Item 8 Financial Statements and Supplementary Data 33 Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 33 Item 9A Controls and Procedures 33 Item 9B Other Information 36 Part III Item 10 Directors, Executive Officers and Corporate Governance 37 Item 11 Executive Compensation 37 Item 12 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 37 Item 13 Certain Relationships and Related Transactions, and Director Independence 37 Item 14 Principal Accounting Fees and Services 37 Item 15 Exhibits, Financial Statement Schedules 38 Signatures 43 1 SPECIAL NOTE ABOUT FORWARD-LOOKING INFORMATION Certain statements in this Annual Report on Form 10-K are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).Forward-looking statements are typically identified by the use of the words “believe,” “may,” “could,” “should,” “expect,” “anticipate,” “estimate,” “project,” “propose,” “plan,” “intend,” and similar words and expressions.Statements that describe our future strategic plans, goals, or objectives are also forward-looking statements.Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements.The forward-looking statements included in this report are made only as of the date of this report.",
"Readers of this report are cautioned that any forward-looking statements, including those regarding us or our management’s current beliefs, expectations, anticipations, estimations, projections, strategies, proposals, plans, or intentions, are not guarantees of future performance or results of events and involve risks and uncertainties, such as: · We may be deemed to be insolvent and may face liquidation. · The auditors’ report for our most recent fiscal year contains an explanatory paragraph about our ability to continue as a going concern. · Our ability to continue energy drink distribution, our principal source of revenue, is subject to interruption or termination because of PlayBev’s ongoing Chapter 11 reorganization proceedings and disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks. · Our interest in PlayBev may be diluted if we raise capital to fund expansion of our energy drink distribution segment. · All of our assets are encumbered to secure the payment of an aggregate of $5.9 million in indebtedness that requires substantial monthly payments, and our default could result in the loss of all of our assets.",
"· We are parties to numerous lawsuits that require significant management attention and funds for attorney’s fees and subject to risk of damages. · We will require substantial amounts of additional capital from external sources. · Any substantial increase in sales will require skilled management of growth. · We cannot predict the impact on our activities of the current economic crises. · We are authorized to issue substantial additional shares of stock, which would dilute the ownership of our stockholders. · Penny stock regulations will impose certain restrictions on resales of our securities, which may cause an investor to lose some or all of its investment. · The factors set forth under “Management’s Discussion and Analysis of Analysis of Financial Condition and Results of Operation” and other factors that are not currently known to us that may emerge from time to time.",
"The forward-looking information is based on present circumstances and on our predictions respecting events that have not occurred, that may not occur, or that may occur with different consequences from those now assumed or anticipated.Actual events or results may differ materially from those discussed in the forward-looking statements.The forward-looking statements included in this report are made only as of the date of this report. 2 PART I ITEM 1.BUSINESS INTRODUCTION AND OVERVIEW We manufacture, market, and distribute internationally an energy drink under a license, now in dispute, with Playboy Enterprises, Inc., or Playboy, and in the U.S., we provide a mix of high- and medium-volume turnkey manufacturing services and products using various high-tech applications for leading electronics OEMs (original equipment manufacturers) in the communications, networking, peripherals, gaming, law enforcement, consumer products, telecommunications, automotive, medical, and semiconductor industries.Our services include pre-manufacturing, manufacturing, and post-manufacturing services.Our goal is to offer customers the significant competitive advantages that can be obtained from manufacture outsourcing.",
"We are engaged in the following business segments. Beverage Distribution (96% and 85% of total revenue during 2011 and 2010, respectively) CirTran Beverage manufactures, markets, and distributes Playboy-branded energy drinks in accordance with an agreement we entered into with Play Beverages, LLC, or PlayBev, a consolidated variable interest entity, which holds the Playboy license. Contract Manufacturing (4% and 1% of total revenue during 2011 and 2010, respectively) CirTran Products pursues contract-manufacturing relationships in the U.S. consumer products markets, including licensed merchandise sold in the sports and entertainment markets. CirTran Asia manufactures and distributes electronics, consumer products, and general merchandise to companies selling in international markets. Marketing and Media (0% and 12% of total revenue during 2011 and 2010, respectively) CirTran Online sells products via the Internet and provides services and support to Internet retailers. CirTran Media provides end-to-end services to the direct-response and entertainment industries.",
"Electronics Assembly (0% and 2% of total revenue during 2011 and 2010, respectively) CirTran Corporation (“CirTran USA”) provides low-volume electronics assembly activities consisting primarily of placing and attaching electronic and mechanical components on printed circuit boards and flexible (i.e., bendable) cables. During 2011, our activities were significantly restrained by the necessity to devote priority to efforts to obtaining the forbearance of our principal secured and judgment creditors, seeking to resolve disputes respecting the PlayBev license to market Playboy-licensed energy drinks, defending the numerous lawsuits to which we are a party, and obtaining additional capital.Disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks impaired our ability to establish new distributors, damaged our relationships with existing distributors, and depressed revenues.All of our activities during the year, as in previous years, were adversely affected by our severe shortages of working capital and cash.",
"References to “us,” “we,” and “our” and correlative terms refer to CirTran Corporation and the subsidiaries and divisions through which we conduct our activities. 3 PRIMARY PRODUCTS AND SERVICES Beverage Distribution CirTran Beverage In May 2007, we incorporated CirTran Beverage to arrange for the manufacture, marketing, and distribution of Playboy-licensed energy drinks, flavored water beverages, and related merchandise through various distribution channels.We also entered into an agreement with Play Beverages, LLC, or PlayBev, a related Delaware limited liability company and the licensee under a product licensing agreement with Playboy to market, manufacture, and distribute energy drinks and beverages under its brand name.Under the terms of the PlayBev agreement, we are to provide the initial development and promotional services to PlayBev, which will collect from us a royalty based on product sales and manufacturing costs once licensed product distribution commences.As part of our efforts to finance the initial development and marketing of the Playboy energy drink, we and other investors formed AfterBev, a majority owned subsidiary organized in California.Effective January 1, 2010, PlayBev was required to be consolidated into our financial statements as a variable interest entity.",
"Regular and sugar-free versions of the Playboy energy drink, in 8.4 and 16 ounce cans, have been developed.We currently have sales and distribution networks in 65 countries throughout Europe, Africa, Australia, the Pacific, and the Middle East, and we anticipate continued growth in 2012, if the dispute over the license with Playboy is resolved by reaching a new license agreement.Energy drink sales and royalties in 2011 and 2010 accounted for 96% and 85% of total sales, respectively. Our net sales and assets by geographic area are as follows: Revenues United States of America $ $ Canada - Eastern Europe Russia - West Africa - South America - Western Europe - Other - $ $ As discussed in detail in Item 3. Legal Proceedings, in April 2011, creditors filed an involuntary bankruptcy petition against PlayBev.Thereafter, this proceeding was converted into a Chapter 11 reorganization proceeding, with PlayBev acting as debtor-in-possession.Playboy initially sought to terminate its product license agreement with PlayBev, but thereafter stipulated to suspend further proceedings pending the exploration of settlement.PlayBev is seeking a settlement that would enable it to continue to market worldwide Playboy-licensed nonalcoholic energy drinks, subject to annual minimum royalties during the following five years, beginning at $2.0 million and escalating to $3.0 million, with the payment of a portion of the royalty obligation assured through our posting of an irrevocable letter of credit.PlayBev would also seek Playboy’s agreement not to circumvent PlayBev’s licensed rights by directly approaching its distributors and downstream marketing channels for so long as it meets its financial obligations to Playboy.We cannot assure that PlayBev will be able to negotiate a settlement with Playboy or predict the terms that may be negotiated.We anticipate that any settlement reached will require PlayBev to obtain substantial amounts of new capital in order to implement and take advantage of such settlement.We will be principally responsible for managing such funding effort.See Item 7.",
"Management’s Discussion and Analysis of Financial Condition and Results of Operations: Liquidity and Capital Resources. 4 If the Playboy licensing dispute is not resolved satisfactorily to us through a negotiated settlement or litigation in the PlayBev Chapter 11 reorganization proceeding, PlayBev would be required to terminate its beverage distribution activities, which are currently the principal source of our revenues. In March 2012, Playboy and PlayBev extended the license through July 31, 2012 to allow them time to negotiate a potential new licensing agreement. The Playboy energy drink and other products we are developing are part of a growing market segment of the beverage industry known as the “new age” or alternative beverage industry.This beverage category includes noncarbonated, ready-to-drink iced teas, lemonades, juice cocktails, single-serve juices and fruit beverages, ready-to-drink dairy and coffee drinks, energy drinks, sports drinks, and single-serve still water (flavored, unflavored, and enhanced) and sodas that are considered natural, sparkling juices, and flavored sparkling beverages. The new age beverage industry is still expanding.According to Beverage Digest, a trade publication covering the nonalcoholic beverages industry, caffeinated energy drinks have become the fastest-growing sector of the $93 billion domestic beverage industry.",
"We believe this industry is growing due to current attention to new brands, non-coffee drinkers, and people interested in health and fitness.By directing products to specific groups, such as extreme sports enthusiasts, energy drinks target consumer groups made up primarily of male teenagers and young people in their 20s. Depending on the outcome of the PlayBev disputes with Playboy as discussed above, as we continue to market our Playboy energy drink and introduce other licensed products, we will compete with other beverage companies not only for consumer acceptance but also for shelf space in retail outlets and for marketing focus by our distributors, all of which also distribute other beverage brands.Our energy drink products compete with all nonalcoholic beverages.Most of the competing products are marketed by companies with substantially greater financial resources than we have.We also compete with regional beverage producers and “private label” soft drink suppliers.We believe that our leading energy drink competitors are Red Bull and Monster. Contract Manufacturing CirTran Products and CirTran - Asia CirTran Products pursues contract-manufacturing relationships in the domestic consumer products markets, including products in areas such as home/garden, kitchen, health/beauty, toys, licensed merchandise, and apparel for film, television, sports, and other entertainment properties.Licensed merchandise and apparel are defined as items that bear the image, likeness, or logo of a product or a person, such as a well-known celebrity, that are sold or advertised to the public.Licensed merchandise and apparel are sold and marketed in the entertainment and sports franchise industries.We have concentrated our product development efforts into three areas: home and kitchen appliances, beauty products, and licensed merchandise.We anticipate that these products will be introduced into the market either under one uniform brand name or under separate trademarked names owned by CirTran Products.We are presently preparing to launch various programs in which CirTran Media, discussed below, will operate as the marketer, campaign manager, and distributor in various product categories, including beauty products, entertainment products, software products, and fitness and consumer products.We anticipate increasing our role in this market as resources become available for allocation to this division.",
"5 The contract-manufacturing industry specializes in providing the program management, technical and administrative support, and manufacturing expertise required to take products from the early design and prototype stages through volume production and distribution.The goal is to provide the customer with a quality product, delivered on time and at the lowest cost.This full range of services gives the customer an opportunity to avoid large capital investments in plant, inventory, equipment, and staffing and to concentrate instead on innovation, design, and marketing.By using our contract-manufacturing services, customers have the ability to improve the return on their investment with greater flexibility in responding to market demands and exploiting new market opportunities. In previous years, we found that customers increasingly required contract manufacturers to provide complete turn-key manufacturing and material handling services, rather than working on a consignment basis in which the customer supplies all materials and the contract manufacturer supplies only labor.Turn-key contracts involve design, manufacturing and engineering support, procurement of all materials, and sophisticated in-circuit and functional testing and distribution.The manufacturing partnership between customers and contract manufacturers involves an increased use of “just-in-time” inventory management techniques that minimize the customer’s investment in component inventories, personnel, and related facilities, thereby reducing their costs.",
"Based on the trends observed in the contract-manufacturing industry, one of our goals is to benefit from the increased market acceptance of, and reliance upon, the use of manufacturing specialists by many original equipment manufacturers, or OEMs, marketing firms, distributors, and national retailers.We believe the trend towards outsourcing manufacturing will continue.OEMs use manufacturing specialists for many reasons, including reducing the time it takes to bring new products to market, reducing the initial investment required, accessing leading manufacturing technology, gaining the ability to better focus resources in other value-added areas, and improving inventory management and purchasing power.An important element of our strategy is to establish partnerships with major and emerging OEM leaders in diverse segments across the electronics industry.Due to the costs inherent in supporting customer relationships, we focus our efforts on customers with which the opportunity exists to develop long-term business partnerships.Our goal is to provide our customers with total manufacturing solutions for both new and more mature products, as well as across product generations - an idea we call “Concept to Consumer.” During 2011, we closed our dedicated office in Bentonville, Arkansas, in an effort to reduce costs.",
"Through CirTran-Asia, we design, engineer, manufacture, and supply products in the international electronics, consumer products, and general merchandise industries for various marketers, distributors, and retailers selling overseas.This subsidiary provides manufacturing services to the direct-response and retail consumer markets.Our experience and expertise in manufacturing enables CirTran - Asia to enter a project at various phases: engineering and design; product development and prototyping; tooling; and high-volume manufacturing.This presence with Asian suppliers helps us maintain an international contract manufacturer status for multiple products in a wide variety of industries and has allowed us to target larger-scale contracts.",
"6 We intend to pursue manufacturing relationships beyond printed circuit board assemblies, cables, harnesses, and injection-molding systems by establishing complete “box-build” or “turn-key” relationships in the electronics, retail, and direct consumer markets. We have developed several fitness and exercise products and products in the household and kitchen appliances and health and beauty aids markets that are manufactured in China.Sales of these products comprised approximately 4% and 1% of revenues reported in 2011 and 2010, respectively.We anticipate that offshore contract manufacturing will play an increased role moving forward as resources will become available to us. Marketing and Media CirTran Online [No 2011 revenue] Prior to 2011, CirTran Online sold products via the Internet to offer training, software, marketing tools, web design and support, and other e-commerce related services to entrepreneurs and to telemarket directly to customers.As part of CirTran Online’s business plan, we entered into an agreement with Global Marketing Alliance (“GMA”), an [unaffiliated] Utah limited liability company specializing in providing services to eBay sellers, conducting Internet marketing seminars, and developing and hosting web sites.We had no revenues from this segment during 2011. We remain capable of providing product marketing services to the direct-response and retail markets for both proprietary and nonproprietary products to provide campaign management and marketing services for both the direct-response retail and beverage distribution markets.We also provide marketing and media services to support our own product efforts, and we offer marketing service in channels involving television, radio, print media, and the Internet to our customers.",
"We previously anticipated that our sales office in Bentonville, Arkansas, in close proximity to Wal-Mart’s world headquarters, would enable us to create and manage an ongoing relationship with Wal-Mart, Sam’s Club, and other retailers, in order to facilitate the distribution of products through those channels.With the closure of this sales office during 2011, those activities have been suspended. Electronics Assembly CirTran USA [No 2011 revenue] In previous years, we provided a mix of high- and medium-volume, turn-key manufacturing services using surface-mount technology, ball-grid array assembly, pin-through-hole, and custom injection-molded cabling for leading electronics OEMs in the communications, networking, peripherals, gaming, law enforcement, consumer products, telecommunications, automotive, medical, and semiconductor industries.Our services included pre-manufacturing, manufacturing, and post-manufacturing services.Our goal was to offer our customers the significant competitive advantages that could be obtained from manufacture outsourcing, such as access to advanced manufacturing technologies, shortened product time-to-market, reduced cost of production, more effective asset utilization, improved inventory management, and increased purchasing power.",
"During 2010, we entered into certain agreements with Katana Electronics, LLC (“Katana”), related to realignment of our legacy electronic manufacturing business.In so doing, we transferred our rights and responsibilities to our open and active purchase orders relating to our legacy electronics contract manufacturing business to Katana (which leases equipment).Accordingly, our electronics assembly segment was suspended during 2010. 7 Racore Network, Inc. Through our Racore subsidiary, we are capable of providing engineering design services to customers of some of our other subsidiaries.",
"SALES AND MARKETING We continue to pursue product development and business development opportunities in the beverage and ancillary product distribution and contract manufacturing segments as well as in the marketing and media and electronics assembly segments that would enable us to reactivate those capabilities. We intend to continue pursuing sales representative relationships as well as internal salaried sales executives.If PlayBev is able to resolve the licensing dispute with Playboy so that it can expand its beverage distribution activities, we anticipate that these expansion efforts, including perhaps the establishment of additional marketing offices in Los Angeles or elsewhere, will be to support the beverage division and to provide product marketing, production, media funding, and merchandising services to the direct-response and entertainment industries. We are working aggressively to market existing products through current sales channels.We also seek new paths to deliver products and services directly to end users, as well as motivate our distributors, partners, and other third-party sales mechanisms.We continue to simplify and improve the sales, order, and delivery process.We are also pursuing strategic relationships with retail distribution firms to engage with us in a reciprocal relationship whereby they would act as our retail distribution arm and we would act as their manufacturing arm, with both parties giving the other priority and first opportunity to work on the other’s products. Historically, we have had substantial recurring sales from existing customers.With the growth of the beverage distribution sales before the PlayBev licensing dispute arose in 2011, we were rapidly gaining new customers, both domestically and internationally.We consider sales and marketing as an integrated process involving direct salespersons and project managers, as well as senior executives.We use independent sales representatives in certain geographic areas and engage consulting groups to make strategic introductions to generate new business.",
"In 2011, 13.4% of our net sales were derived from new customers, whereas during 2010, 9% of our net sales were sourced from new customers.The increase in new customer sales was caused by opening new national and international beverage territories.During 2011, nearly 100% of the sales from recurring customer sales were related to sales of Playboy energy drinks.We anticipate beverage-related sales and services to continue providing the majority of our net sales. Our expansion into manufacturing in China has allowed us to increase our manufacturing capacity and output with minimal capital investment required.By using various subcontractors, we leverage our upfront payments for inventories and tooling to control costs and receive benefits from economics of scale in Asian manufacturing facilities.These expenses can be upwards of $100,000 per product.Typically, and depending on the contract, we will prepay some factories anywhere from 10% to 50% of the purchase orders for materials.In exchange for theses financial commitments, we receive dedicated manufacturing responsiveness and eliminate the costly expense associated with capitalizing completely proprietary facilities.In addition, we have expanded our manufacturing capabilities for our beverage division outside the United States to accommodate customers located in Europe.In 2010, we contracted with a manufacturer in Budapest, Hungary, and in early 2011, in India to accommodate its distributor in those areas.",
"8 We have beverage contracts that require minimum quantity purchase orders over periods terminating between 2011 and 2021.If the full minimum quantity orders are purchased under these current agreements, they would generate upwards of $500,000,000 in revenues to us.The majority of these international distribution contracts are based on minimum orders they are required to purchase during the term of the contract to maintain their rights to sell the Playboy Energy Drink.Revenue under these contracts is not recognized until ordered products have been shipped.There is no assurance, except for the upfront deposits, that the parties to these agreements will meet their obligations for the minimum quantity or any level of purchases required under their respective agreements. During a typical contract manufacturing sales process, a customer provides us with specifications for the product it wants, and we develop a bid price for manufacturing a minimum quantity that includes manufacture engineering, parts, labor, testing, and shipping.If the bid is accepted, the customer is required to purchase the minimum quantity, and additional product is sold through purchase orders issued under the original contract.Special engineering services are provided at either an hourly rate or at a fixed contract price for a specified task.",
"COMPETITION Beverage Distribution The beverage industry is highly competitive.Our energy drinks compete with others in the marketplace in terms of pricing, packaging, development of new products and flavors, and marketing campaigns.These products compete with a wide range of drinks produced by a relatively large number of manufacturers, most of which have substantially greater financial, marketing, and distribution resources than we have.In an effort to protect against dependence on a single source supplier, we have established multiple beverage manufacturing facilities in strategic locations. We believe that factors affecting our ability to compete successfully in the beverage industry include taste and flavor of products, strong recognition of the Playboy brand and related branded product advertising, industry and consumer promotions, attractive and different packaging, and pricing.We also compete for distributors; most of our distributors also sell products manufactured by our competitors, and we will compete for the attention of these distributors to endeavor to sell our products ahead of those of our competitors, provide stable and reliable distribution, and secure adequate shelf space in retail outlets.These and other competitive pressures in the energy beverage category could cause our products to be unable to gain or to lose market share or we could experience price erosion, which could have a material adverse affect on our business and results. We compete not only for consumer acceptance, but also for maximum marketing efforts by multi-brand licensed bottlers, brokers, and distributors, many of which have a principal affiliation with competing companies and brands.Our products compete with all liquid refreshments and with products of much larger and substantially better financed competitors, including the products of numerous nationally and internationally known producers such as Hansen’s Energy, Diet Red, Monster Energy, Lost Energy, Joker Mad Energy, Ace Energy, Unbound Energy, Rumba energy juice, Red Bull, Rockstar, Full Throttle, No Fear, Amp, Adrenaline Rush, 180, Extreme Energy Shot, Red Devil, Rip It, NOS, Boo Koo, Vitaminenergy, and many other brands.We also compete with companies that are smaller or primarily local in operation.Our products also compete with private label brands such as those carried by grocery store chains, convenience store chains, and club stores.",
"9 Contract Manufacturing We believe that the primary basis of competition in our targeted markets is manufacturing technology, quality, responsiveness, the provision of value-added services, and price.To remain competitive, we must continue to provide technologically advanced manufacturing services, maintain quality levels, offer flexible delivery schedules, deliver finished products on a reliable basis, and compete favorably on the basis of price. The electronic manufacturing services industry is large and diverse and is serviced by many companies, including several that have achieved significant market share.Because of our market’s size and diversity, we do not typically compete for contracts with a discreet group of competitors.We compete with different companies depending on the type of service or geographic area.Certain of our competitors have greater manufacturing, financial, research and development, and marketing resources.We also face competition from current and prospective customers that evaluate our capabilities against the merits of manufacturing products internally. REGULATION We are subject to typical federal, state, and local regulations and laws governing the operations of manufacturing concerns, including environmental disposal, storage and discharge regulations and laws, employee safety laws and regulations, and labor practices laws and regulations.We are not required under current laws and regulations to obtain or maintain any specialized or agency-specific licenses, permits, or authorizations to conduct our manufacturing services.We believe we are in substantial compliance with all relevant regulations applicable to our business and operations.All international sales permits are the responsibility of the local distributors and they are required to obtain all local licenses and permits. EMPLOYEES As of April 16, 2012, we employed a total staff of 11 full-time employees in the United States.In addition, we employ employees through contract services to provide promotional activities in the United States.In our Salt Lake headquarters, we employ five persons: three in administrative and clerical positions and one each in sales and project management.",
"We believe that our relationship with our employees is good. CORPORATE BACKGROUND AND HISTORY In 1987, CirTran Corporation was incorporated in Nevada under the name Vermillion Ventures, Inc., for the purpose of acquiring other operating corporate entities.We were largely inactive until July 1, 2000, when our wholly owned subsidiary, CirTran Corporation (Utah) acquired substantially all of the assets and certain liabilities of Circuit Technology, Inc. Our predecessor business in Circuit Technology, Inc., was commenced in 1993 by our president, Iehab Hawatmeh.In 2001, we effected a 15-for-1 forward-split of our shares and a stock distribution, which increased the number of our issued and outstanding shares of common stock.We also increased our authorized capital from 500,000,000 to 750,000,000 shares.In 2007, our shareholders approved a 1.2-for-1 share forward split and an amendment to our Articles of Incorporation that increased our authorized capital to 1,500,000,000 shares of common stock.In August 2011, we increased our authorized capitalization to 4,500,000,000 shares of common stock, par value $0.001.",
"10 AVAILABLE INFORMATION Federal securities laws require us to file information with the Securities and Exchange Commission (“SEC”) concerning our business and operations.Accordingly, we file annual, quarterly, and interim reports, and other information with the SEC.You can inspect and copy this information at the public reference facility maintained by the SEC at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, and Washington, D.C. 20549.You can get additional information about the operation of the SEC’s public reference facilities by calling the SEC at 1-800-SEC-0330.The SEC also maintains a web site (http://www.sec.gov) at which you can read or download our reports and other information.",
"Our Internet addresses are www.cirtran.com, www.playboyenergy.com and www.racore.com.Information on our websites is not incorporated by reference herein.We make available free of charge through our corporate website, www.cirtran.com, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. ITEM 1A.RISK FACTORS In addition to the negative implications of all information and financial data included in or referred to directly in this periodic report, you should consider the following risk factors.This periodic report contains forward-looking statements and information concerning us, our plans, and other future events.Those statements should be read together with the discussion of risk factors set forth below, because those risk factors could cause actual results to differ materially from such forward-looking statements. We may be deemed to be insolvent and may face liquidation. We may be deemed to be insolvent.We are unable to meet all of our obligations as they accrue, and the aggregate amount of our liabilities may exceed the value of our assets.Creditors may have the right to initiate involuntary bankruptcy proceedings against us in which they would seek our liquidation.We cannot assure that we would be successful in efforts to avoid liquidation by converting such liquidation proceedings to a Chapter 11 reorganization to permit us to develop and propose for creditor approval a reorganization plan that would enable us to proceed.Even if we were to be able to propose a reorganization plan, any such reorganization plan would likely require that we obtain new post-petition funding, which may be unavailable.Further, in the event of a bankruptcy filing, our secured creditors that have encumbrances on all of our assets would likely execute and take all of our assets, which likely would leave nothing for other creditors or the shareholders.",
"The auditors’ report for our most recent fiscal year, like previous years, contains an explanatory paragraph about our ability to continue as a going concern. We had a net loss of $7.0 million during 2011 and an accumulated deficit of $48.3 million as of December 31, 2011.In addition, during 2011 we used cash of $320,115 in our operations.We have borrowed funds in the form of short-term advances, notes, and convertible debentures with an aggregate outstanding balance of $8.3 million as of December 31, 2011.We had a negative working capital balance of $25.5 million as of December 31, 2011.The report of our auditors on our consolidated financial statements for the years ended December31, 2011 and 2010, contains an explanatory paragraph about our ability to continue as a going concern.",
"11 Our ability to continue energy drink distribution, our principal source of revenue, is subject to interruption or termination because of PlayBev’s ongoing Chapter 11 reorganization proceedings and disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks. Playboy has sought in PlayBev’s Chapter 11 reorganization proceedings to terminate PlayBev’s license to market Playboy-licensed energy drinks.We cannot assure that Playboy’s current willingness to discuss a possible settlement rather than aggressively pursue a judicial determination will continue.If the Playboy licensing dispute is not resolved satisfactorily through a negotiated settlement or litigation in such proceeding, PlayBev would be required to terminate its beverage distribution activities, which are currently the source of our principal revenues.Such termination may require us to cease our activities and seek protection from creditors. Our interest in PlayBev may be diluted if we raise capital to fund expansion of our energy drink distribution segment.",
"If PlayBev is able to resolve the Playboy licensing dispute through a negotiated settlement, PlayBev would likely need to seek substantial external capital to fund an accelerated and expanded marketing and distribution effort. We cannot assure that such efforts would be successful.Any new funding provided to PlayBev would likely reduce our percentage equity interest in PlayBev. All of our assets are encumbered to secure the payment of an aggregate of $5.9 million in indebtedness that requires substantial monthly payments, and our default could result in the loss of all of our assets.",
"We have encumbered all of our assets to secure the payment of approximately $4.1 million in indebtedness due YA Global Investments, L.P., or YA Global,” which requires payments of $25,000 per month through June 2012, $50,000 per month during July through September 2012, $75,000 in October and November 2012, and $100,000 per month through May 2013, with monthly payments increasing thereafter and with the balance due in January 2014.We also have to meet certain financial and operating covenants in order to avoid default under our obligation to YA Global. We have placed a second encumbrance on all of our assets, subject to the priority encumbrance of YA Global, to secure the payment of approximately $1.8 million in indebtedness due Advanced Beauty Solutions, LLC, or “ABS,” which requires monthly payments of $7,500 per month through December 2015 ($15,000 in December 2012), with the balance due in January 2016.",
"The obligations due these creditors would have to be paid in order to avoid default, notwithstanding the claims of our trade and other unsecured creditors or the results of our operations.Because of our limited revenues and access to alternative sources of capital, we cannot assure that we will be able to meet these monthly obligations timely. If we were to default in any payment, YA Global and ABS could exercise their remedies, including the execution on all of our assets, which would result in the termination of our activities.We cannot assure that either YA Global or ABS would consider or agree to any forbearance from aggressive collection efforts.The existence of these secured obligations will likely significantly impair our ability to obtain capital from external sources. We are parties to numerous lawsuits that require significant management attention and funds for attorney’s fees and subject us to risks of damages or other adverse judgments.",
"As noted in Item 3. Legal Proceedings, we are a party to numerous lawsuits, some of which remain active, requiring that we incur attorney’s fees and other costs and devote management time and attention. 12 Litigation respecting the status of the PlayBev license to market Playboy-licensed energy drinks places the validity of that license at issue and may result in termination of that license, which is the principal source of our revenue.Successful suits by creditors for the collection of debts may require that we pay judgment amounts, subject to the priority encumbrances in favor of secured creditors.We may incur significant costs to pursue litigation in which we are the plaintiff without any recovery or other favorable outcome. Any judgments we may obtain against third parties may not be collectible. We will require substantial amounts of additional capital from external sources.",
"Whether or not the Playboy licensing dispute being litigated in the PlayBev Chapter 11 reorganization proceeding reaches a negotiated settlement, we will require substantial additional funds to implement our marketing plan and pursue expansion of our beverage distribution business segment.The extent of our future capital requirements will depend on many factors, including the financial requirements under a Playboy licensing arrangement; marketing plans; the growth of contract manufacturing; establishment of strategic alliances, joint ventures, or other collaborative arrangements; and other factors not within our control.We anticipate that we will seek required funds from external sources.However, our precarious financial condition, limited revenues, substantial secured indebtedness, continuing lawsuits, and uncertainties respecting the status of the PlayBev license to market Playboy-licensed energy drinks will make it difficult for us to obtain such capital.",
"We may seek required funds through the sale of equity or other securities.Our ability to complete an offering on acceptable terms will depend on many factors, including the condition of the securities markets generally and for companies such as us at the time of such offering; the business, financial condition, and prospects at the time of the proposed offering; our ability to identify and reach a satisfactory arrangement with prospective underwriters; and various other factors, many of which are outside our control.There can be no assurance that we will be able to complete an offering on terms favorable to us or at all.The issuance of additional equity securities may dilute the interest of our existing shareholders or may subordinate their rights to the superior rights of new investors. In October 2011, PlayBev issued a $1.5 million capital call, of which only approximately $469,000 was provided.It may continue to seek the balance of such financing as well as additional capital to fund its Chapter 11 reorganization.",
"We may also seek additional capital through strategic alliances, joint ventures, or other collaborative arrangements.Any such relationships may dilute our interest in any specific project and decrease the amount of revenue that we may receive from such project.There can be no assurance that we will be able to negotiate any strategic investment or obtain required additional funds on acceptable terms, if at all.In addition, our cash requirements may vary materially from those now planned because of the results of future research and development; results of product testing; potential relationships with our strategic or collaborative partners; changes in the focus and direction of our research and development programs; competition and technological advances; issues related to patent or other protection for proprietary technologies; and other factors. If adequate funds are not available, we may be required to delay, reduce the scope of, or eliminate our planned marketing efforts; to obtain funds through arrangements with strategic or collaborative partners that may require us to relinquish rights to certain of our technologies, product candidates, or products that we would otherwise seek to develop or commercialize ourselves; or to license our rights to such products on terms that are less favorable to us than might otherwise be available. 13 Any substantial increase in sales will require skilled management of growth. If we have the opportunity to expand our operations, our success will depend on our ability to manage continued growth, including integration of our executive officers, directors, and consultants into an effective management and technical team; to formulate strategic alliances, joint ventures, or other collaborative arrangements with third parties; to commercialize and market our proposed products and services; and to monitor and manage these relationships on a long-term basis.If our management is unable to integrate these resources and manage growth effectively, the quality of our products and services, our ability to retain key personnel, and the results of our operations would be materially and adversely affected.",
"We cannot predict the impact on our activities of the current economic crises. The current economic crises have adversely affected and will likely continue to adversely affect our ability to expand or generate new sales.We may be unable to expand sales in a constricted or further constricting economy. We are authorized to issue substantial additional shares of stock, which would dilute the ownership of our stockholders. We have authorized 4,500,000,000 shares of common stock, of which 1,839,302,289 shares of common stock are issued and outstanding as of the date of this report.Our board of directors has the authority, without action or vote of the shareholders, to issue all or part of the authorized but unissued shares.Any such issuance will dilute the percentage ownership of shareholders and may further dilute the book value of the shares of common stock. Penny stock regulations will impose certain restrictions on resales of our securities, which may cause an investor to lose some or all of its investment.",
"The Securities and Exchange Commission has adopted regulations that generally define a “penny stock” to be any equity security that has a market price (as defined) of less than $5.00 per share that is not traded on a national securities exchange or that has an exercise price of less than $5.00 per share, subject to certain exceptions.As a result, our common stock is subject to rules that impose additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers and accredited investors (generally those with assets in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together with their spouse).For transactions covered by these rules, the broker-dealer must make a special suitability determination for the purchase of such securities and have received the purchaser’s written consent to the transaction prior to the purchase.Further, if the price of the stock is below $5.00 per share and the issuer does not have $2.0 million or more net tangible assets or is not listed on a registered national securities exchange, sales of such stock in the secondary trading market are subject to certain additional rules promulgated by the Securities and Exchange Commission.These rules generally require, among other things, that brokers engaged in secondary trading of penny stocks provide customers with written disclosure documents, monthly statements of the market value of penny stocks, disclosure of the bid and asked prices, and disclosure of the compensation to the broker-dealer and the salesperson working for the broker-dealer in connection with the transaction.These rules and regulations may affect the ability of broker-dealers to sell our common stock, thereby effectively limiting the liquidity of our common stock.These rules may also adversely affect the ability of persons that acquire our common stock to resell their securities in any trading market that may exist at the time of such intended sale.",
"14 ITEM 1B.UNRESOLVED STAFF COMMENTS None. ITEM 2.PROPERTIES On May 4, 2007, we entered into a ten-year lease agreement for our existing 40,000 square-foot headquarters and manufacturing facility, located at 4125 South 6000 West in West Valley City, Utah.Monthly payments are $10,000, adjusted annually in accordance with the Consumer Price Index.The Premises include 10,000 square feet of office space to support administration, sales, and engineering staff and 30,000 square feet of manufacturing space, which includes a secured inventory area, shipping and receiving areas, and manufacturing and assembly space. In 2010, we subleased to Katana Electronics, LLC, approximately 32,000 square feet of our West Valley City, Utah facility, consisting of the warehouse, electronics product manufacturing and assembly area, and office space used as of the close of business on March 4, 2010, for our legacy electronics manufacturing business.",
"The sublease continued on a month-to-month basis at a base rent of $8,500 per month.The sublease contained normal and customary use restrictions, indemnification rights and obligations, default provisions, and termination rights. On June 30, 2011, the Company’s lease agreement was terminated for the Company's existing 40,000 square-foot headquarters and manufacturing facility, located at 4125 South 6000 West in West Valley City, Utah. On July 1, 2011, Katana signed a new lease agreement with the building’s owner and the Company has agreed to pay Katana $5,000 per month for the use of office space and utilities. We believe that the facilities and equipment described above are generally in good condition, are well maintained, and are suitable and adequate for our current and projected operating needs. ITEM 3.LEGAL PROCEEDINGS We are a party to the following material legal proceedings. Advanced Beauty Solutions, LLC v. CirTran Corporation, Case No. 1:08-ap-01363-GM.",
"In connection with our prior litigation with Advanced Beauty Solutions, or ABS, it claimed nonperformance by us and filed an adversary proceeding in its bankruptcy case proceeding in the United States Bankruptcy Court, Central District of California, San Fernando Valley Division.On March 17, 2009, the Bankruptcy Court entered judgment in favor of ABS and against us in the amount of $1,811,667, plus interest.On September 11, 2009, the Bankruptcy Court denied our motion to set aside the judgment. 15 On September 8, 2010, we executed an Assignment of Copyrights, thereby assigning our Copyright Registration No. TX-6-064-955, Copyright Registration No. TX-6-064-956, and Copyright to the True Ceramic Pro - Live Ops (TCPS) infomercial and related master tapes (collectively the “Copyrights”) to ABS, without reservation or exclusion, making ABS the owner of the Copyrights.",
"On February 23, 2011, we filed a Motion to Declare Judgment Fully Satisfied or Alternatively to Recoup Mutual Debts, requesting that the court determine that our assignment of the Copyrights resulted in full satisfaction of the ABS judgment.On March 3, 2011, ABS brought a Motion for Order to Show Cause re Civil Contempt alleging that we had failed to make payments on ABS’s judgment in violation of the court’s orders.At the hearing on April 6, 2011, the court denied our motion to declare the judgment fully satisfied and granted ABS’s motion, but did not hold us in civil contempt.The court also set a hearing on the ABS motion for the order to show cause for July 8, 2011, regarding our compliance with collection orders, which the parties stipulated should be postponed until August 3, 2011.The parties attended mediation on July 11, 2011, but no formal settlement resulted.At the hearing in August, the court found that a basis existed to hold us in contempt and set an evidentiary hearing for October 6, 2011, to determine whether to issue a contempt citation.We appealed the denial of the motion to declare judgment satisfied.",
"On March 22, 2012, we entered into a formal forbearance agreement with ABS, dated as of March 1, 2012 (the “ABS Forbearance Agreement”), whereby ABS agreed to take no further judgment enforcement actions in consideration of the payment of $25,000 upon execution of the definitive ABS Forbearance Agreement and satisfaction of applicable conditions precedent.The ABS Forbearance Agreement calls for us to pay $7,500 per month for 46 consecutive months (except for a payment of $15,000 in December 2012), commencing in March 2012, with the unpaid balance, as finally determined as provided below, due and payable in January 2016.No interest on the principal would accrue unless the note is in default, in which case, it would bear interest at 10% per annum from the date of the ABS Forbearance Agreement.In addition, we stipulated to an additional judgment for attorney’s fees incurred in negotiating the ABS Forbearance Agreement and entering into the related definitive agreements and in related post-judgment collection efforts.The obligation to pay $1,835,000 under the ABS Forbearance Agreement would be secured by an encumbrance on all of our assets, subject to the prior lien and encumbrance in favor of YA Global. The principal amount of $1,835,000 due under the ABS Forbearance Agreement would be reduced by the greater of the amount of credit granted in the bankruptcy proceedings for the value of the intellectual property we previously conveyed to ABS and the amount received by ABS from the sale of such intellectual property to a third party during the term of the ABS Forbearance Agreement, plus the amount of any distribution to which we are entitled as a creditor of ABS, provided, however, that in no event would the amount due under the ABS Forbearance Agreement be reduced below $90,000, which is the amount payable during the first 12 months under the ABS Forbearance Agreement.ABS entered into a subordination agreement subordinating the obligation under the ABS Forbearance Agreement in favor of the obligations and first-priority security interest of YA Global.We conveyed to ABS the trademarks and intellectual property previously conveyed by ABS to us.We have accrued a balance of $90,000 for the minimum required payment under the ABS Forbearance Agreement.",
"Our appeal of the approximately $1.8 million judgment has been remanded in the ABS bankruptcy proceedings to conclusively determine the amount of credit due us for the conveyance of the intellectual property.Except for the determination of the fair market value of the intellectual property and any enforcement or collection proceedings that may be required under the ABS Forbearance Agreement, all litigation and disputes between ABS and its affiliates, on the one hand, and us and our affiliates, on the other hand, would be dismissed, including the pending order to show cause regarding contempt against us, our subsidiaries, and Iehab Hawatmeh. 16 We have assigned to ABS our creditor claim against the estate of ABS, to the extent of the balance due under the ABS Forbearance Agreement.Any distribution from the ABS estate in excess of the adjusted amounts due under the ABS Forbearance Agreement will be paid to us. YA Global Investments, LP v. CirTran Corporation, Third Judicial District Court of Salt Lake County, State of Utah, case no. 100911400. On June 25, 2010, YA Global filed a lawsuit against us asserting claims for breach of contract, breaches of the uniform commercial code, and replevin.YA Global seeks a judgment in the amount of $4,193,380, plus interest and attorneys fees, as well as a writ of replevin to compel us to turn over equipment and other property that YA Global claims was pledged as collateral to secure obligations owing to YA Global.We do not dispute that we are indebted to YA Global in the amount of $3,161,355, plus interest, but we deny that we are in breach of our payment obligations because YA Global agreed to restructure the payment schedule and we relied on this agreement.",
"On January 24, 2011, we entered into a forbearance agreement with YA Global, including a confession of judgment in its favor.On February 23, 2011, the court entered judgment based on the confession of judgment against us in the principal amount of $3,161,355, plus interest of $825,858. On July 22, 2011, YA Global filed a motion in the ABS lawsuit (discussed above) seeking an order clarifying its position with respect to ABS and staying enforcement of that court’s order that we pay approximately $35,000 in legal fees to ABS.In its motion, YA Global notified us that it intended to conduct a secured party’s public auction of all of our assets.YA Global also informed us that we had defaulted under our January 2011 Forbearance Agreement and declared that all of our obligations to YA Global were immediately due and owing.Further, YA Global stated that it intended to commence action to collect on our obligations and instructed us to assemble the assets. At a hearing held on August 3, 2011, in the ABS reorganization proceeding referred to above on YA Global’s motion to stay enforcement, YA Global noted that the date of the proposed secured party’s public auction was August 30, 2011.At the same time, YA Global notified us that the proposed sale of assets would be held on August 30, 2011.",
"At the hearing in the ABS matter, the Bankruptcy Court denied YA Global’s motion to stay the payment of attorneys’ fees by us.Subsequently, the parties to the January 2011 settlement with YA Global entered into an agreement whereby YA Global agreed to cancel the proposed asset sale without waiver. On September 30, 2011, YA Global directed us to assemble the collateral in order to enable it to take possession on or before October 6, 2011.Following negotiations with YA Global, we confirmed our indebtedness to YA Global and arranged for it to take possession of collateral on October 17, 2011, on which date, all accounts receivable, collections, and other proceeds and products of the collateral would be held in trust by us for YA Global and immediately forwarded to it.Before we were required to surrender possession of the collateral, we initiated negotiations to obtain YA Global’s forbearance from collection. 17 On March 22, 2012, we entered into a formal forbearance agreement with YA Global, dated as of March 1, 2012 (the “2orbearance Agreement”) in which we ratified our previous obligations under the debentures and agreed to pay the debentures, $25,000 at signing the 2orbearance Agreement, $25,000 per month in March through June 2012, $50,000 per month in July through September 2012, $75,000 in the months of October and November 2012, $100,000 per month in the months of December 2012 through May 2013, $125,000 per month in the months of June through December 2013, and the balance in December 2014 (the “Termination Date”).",
"In addition to the above minimum payments to YA Global, we are required to pay monthly excess cash flow, to the extent cumulatively available, consisting of consolidated earnings before interest, taxes, depreciation and amortization, less cash deposits for product orders received but not yet shipped, actual cash taxes paid, actual cash principal and interest paid, and reasonable out-of-pocket cash paid together with reasonable cash reserves in an amount not to exceed 5% of total net sales, provided that such excess cash flow payments shall not to exceed $50,000 in March 2012 and $25,000 per month in April 2012 and thereafter, until the balance is paid. As of December 31, 2011, the balance due YA Global was $3,161,355 in principal plus $856,546 in accrued interest. We continue to have the right, subject to the consent of YA Global, to pay all or any portion of the payments listed above in common stock, with the conversion price to be used to determine the number of shares being equal to the lowest closing bid price of our common stock during the 20 trading days prior to the payment date.The amount applied as a payment on the note and accrued interest will be adjusted to the value of the actual proceeds from the sale of the stock. YA Global agreed to forbear from enforcing its rights and remedies as a result of the existing defaults and/or converting the debentures into shares of our common stock, until the earlier of our default under the 2orbearance Agreement or the Termination Date.",
"In re Play Beverages, LLC, United States Bankruptcy Court for the District of Utah, Case No. 11-26046, and related matters. On April 26, 2011, three alleged creditors, LIB-MP Beverage, LLC, George Denney, and Warner K. Depuy, filed an involuntary Chapter 7 petition against Play Beverages, LLC, a consolidated entity of our subsidiary (“PlayBev”), seeking its liquidation.Thereafter, management decided that reorganizing PlayBev as a debtor-in-possession under Chapter 11, of Title 11, of the United States Bankruptcy Code, was in the best interests of PlayBev and its creditors and equity holders.Accordingly, on August 12, 2011, PlayBev consented to the entry of an order for relief in the pending involuntary bankruptcy case and immediately exercised its right under Section 706(a) of the Bankruptcy Code to convert the case to a voluntary Chapter 11 reorganization case.That same day, the court entered an Order for Relief under Chapter 11 based on PlayBev’s elections.PlayBev is now a debtor-in-possession and intends to propose and confirm a plan of reorganization.",
"Playboy Enterprises International, Inc. (“Playboy”), has filed a motion to terminate the automatic stay to permit it to terminate a Product License Agreement between it and PlayBev.PlayBev contested the motion, and before the hearing was held, Playboy stipulated to suspend all litigation between the parties while they explore the possibility of a mutually beneficial settlement of their disputes.At this time, there are no motions or other matters scheduled for hearing. PlayBev continues to negotiate with its creditors and is formulating a plan of reorganization.PlayBev also continues to negotiate with Playboy regarding assumption of its Product License Agreement. General Distributors, Inc. v. Iehab Hawatmeh and CirTran Beverage Corp. d/b/a Play Beverages LLC d/b/a Playboy Beverages, in the Circuit Court of the State of Oregon, for the County of Clackamas, Case No.",
"CV 10110087. On November 8, 2010, General Distributors, Inc., filed a complaint asserting claims for breach of contract, liability under the Uniform Commercial Code, quasi contract - unjust enrichment, goods sold and delivered, account stated, and attorneys fees and seeking judgment in the amount of $49,999, plus interest and attorneys fees.We and the other defendants have answered the complaint and denied liability.Because of the effect of the automatic stay in connection with the In Re Play Beverages, LLC bankruptcy matter (discussed above), the litigation in this matter has been stayed.",
"We do not consider it necessary to accrue a liability for the potential liability. 18 Playtime Distributing of Oklahoma LLC v. CirTran Corporation, CirTran Beverage Corporation, and Play Beverages LLC, in the District Court of Oklahoma County, State of Oklahoma, Case No. CJ-2010-1058. On December 30, 2010, Playtime Distributing of Oklahoma LLC filed suit asserting claims for breach of a distribution agreement, bad faith breach of a distribution agreement, rescission of the distribution agreement, accounting, breach of an independent sales agreement, bad faith breach of an independent sales agreement, and punitive damages and seeking judgment in an unspecified amount in excess of $75,000, plus interest and attorneys fees.We and the other defendants have answered and denied liability.Because of the effect of the automatic stay in connection with the In Re Play Beverages, LLC bankruptcy matter (discussed above), the litigation in this matter has been stayed.",
"We do not consider it necessary to accrue a liability for the potential liability. Various Creditor Claims Apex Maritime Co. (LAX), Inc. v. CirTran Corporation, CirTran Asia, Inc., et al., California Superior Court, Los Angeles County, SC098148.Plaintiff Apex Maritime Co. (LAX), Inc., filed a complaint on May 8, 2008, against us and our CirTran - Asia subsidiary claiming breach of contract, nonpayment on open book account, nonpayment of an account stated, and nonpayment for services, seeking approximately $62,000 against us and $121,000 against CirTran - Asia.On March 3, 2009, the court entered its judgment pursuant to the Release and Settlement Agreement.On April 23, 2009, a Judgment Enforcing Settlement was entered against us in the principal amount of $173,000, plus fees of $1,800 and costs of $40.On October 28, 2009, the Third Judicial District Court, District of Utah, West Jordan Department, entered an Order in Supplemental Proceedings, with which we complied.The parties have previously engaged in settlement negotiations.These amounts have been accrued in full as a liability.",
"Global Freight Forwarders v. CirTran Asia, Civil No. 080925731, Third Judicial District Court, Salt Lake County, State of Utah.On December 18, 2008, plaintiff filed a complaint against CirTran - Asia claiming breach of contract, breach of the duty of good faith and fair dealing, and unjust enrichment and seeking approximately $260,000.The parties agreed to settle this matter for $8,000, which CirTran-Asia, Inc., has paid in May 2011. Dr. Najib Bouz v. CirTran Beverage Corp, Iehab Hawatmeh, and Does 1-20, Superior Court for the State of California, County of Los Angeles, Civil No.",
"KC053818.On September 12, 2008, plaintiff filed a complaint seeking a judgment for $52,500, plus attorneys’ fees and certain costs, against CirTran Beverage, Iehab Hawatmeh, and unnamed others, claiming breach of contract and fraud in connection with a certain promissory note.On August 11, 2009, the parties entered into a settlement agreement whereby the claims against Mr. Hawatmeh were dismissed with prejudice, and we agreed to pay Dr. Bouz $63,000 over 12 months.We have made nine monthly payments, but we are in default of the $5,250 monthly payments that were due on May 28, June 28, and July 28, 2010.The judgment has been domesticated in Utah, and Dr. Bouz has begun pursuing collection efforts.These amounts have been accrued in full as a liability. Dr. Paul Bouz v. CirTran Beverage Corp, Iehab Hawatmeh, and Does 1-20, Superior Court for the State of California, County of Los Angeles, Civil No.",
"KC053819.On September 12, 2008, plaintiff filed a complaint seeking a judgment for $52,500, plus attorneys’ fees and certain costs, against CirTran Beverage, Iehab Hawatmeh, and unnamed others, claiming breach of contract and fraud in connection with a certain promissory note.On August 11, 2009, the parties entered into a settlement agreement whereby the claims against Mr. Hawatmeh were dismissed with prejudice, and we agreed to pay Dr. Bouz $63,000 over 12 months.We have made 10 monthly payments, but we are in default of the $5,250 monthly payments that were due on June 28 and July 28, 2010.The judgment has been domesticated in Utah, and Dr. Bouz has begun pursuing collection efforts.These amounts have been accrued in full as a liability. 19 NA CL&D Graphics v. CirTran Beverage Corp., Case No. 09V01154, Circuit Ct, Waukesha County, Wisconsin.On or about March 23, 2009, NA CL&D Graphics filed an action in the above court alleging claims for breach of contract, unjust enrichment, promissory estoppel, and seeking damages of at least $25,488 along with attorneys’ fees and costs.CirTran Beverage is reviewing the matter and intends to defend vigorously against the allegations in the complaint.These amounts have been accrued in full as a liability. Old Dominion Freight Line v. CirTran Corporation, Civil No.",
"090426290, Third Judicial District Court, Salt Lake County, State of Utah.On May 5, 2010, the court entered an Order in Supplemental Proceedings in connection with a judgment in favor of Old Dominion and against us in the amount of $33,187.The parties agreed to resolve this matter under terms requiring us to pay $20,000 over time.To date, the required payments have not been made.These amounts have been accrued in full as a liability. Jimmy Esebag v. CirTran Corporation and Fadi Nora, Superior Court of the State of California, Los Angeles County, Case No. BC296162.On July 15, 2010, the court entered judgment against us in the amount of $68,270 based upon our failure to make payments when due under a settlement with Mr. Esebag.Mr. Esebag has engaged in some actions to collect on the judgment.These amounts have been accrued in full as a liability.",
"Desiree Liston v. CirTran Media Corp. d/b/a Diverse Media Group Corp., Circuit Court of Benton County, Arkansas, Case No. CV2010-2448-6.On July 28, 2010, Desiree Liston filed a complaint seeking an unspecified amount in excess of $75,000 based on allegations of breach of an employment agreement.Judgment was entered against us on November 28, 2011, for $22,143. Gordon Jensen d/b/a Gordon Jensen Trucking v. CirTran Corp., Third Judicial District Court of Salt Lake County, State of Utah, case no. 108900934.On May 28, 2010, plaintiff brought an action seeking $7,145 for nonpayment of services.Judgment was entered against us on October 7, 2010, for $6,703.These amounts have been accrued in full as a liability. USS Cal Builders, Inc. v. CirTran Beverage Corp., Iehab Hawatmeh, and Fadi Nora, in the Superior Court of the State of California, County of Orange, Case No. 00425093.On November 16, 2010, USS Cal Builders, Inc., filed a complaint asserting various claims and seeking damages of at least $100,000, plus interest, costs, and attorneys fees.We and the individual defendants have answered the amended complaint, denied liability, and intend to defend the claims.",
"We do not consider it necessary to accrue a liability for the potential liability. RDS Touring and Promotions, Inc. v. CirTran Beverage Corp., CirTran Corp., and CirTran Media Corp., in the Superior Court of the State of California, County of Los Angeles, Case No. BC454112.On January 31, 2011, RDS Touring and Promotions, Inc., filed a complaint asserting claims for breach of settlement agreement, fraud in the inducement, and fraud and deceit (false promise).Following a motion filed by us, plaintiffs amended their complaint including only the contract claim.We have answered the amended complaint.Although we do not deny that we are currently in breach of the settlement agreement, there is a dispute as to whether we are obligated under the settlement agreement. These amounts have been accrued in full as a liability. 20 American Express Travel Related Services Company, Inc. v. CirTran Corporation d/b/a Diverse Media Group and Iehab Hawatmeh, in the Third District Court, State of Utah, Salt Lake County.In this action, American Express asserts a claim for $108,029 in principal and $24,269 in interest due on a credit card account.We have answered denying liability and intend to defend the claims.",
"These amounts have been accrued in full as a liability. Ayad Jaber, Ramzy Fakhoury, Haya Enterprises, LLC v. CirTran Beverage Corporation, Play Beverages LLC, Iehab Hawatmeh, and Fadi Nora, in the Superior Court of the State of California, County of Orange, Case No. 0443807.On January 24, 2011, plaintiffs filed a complaint asserting claims based on alleged breaches of various written and oral promises and seeking damages of $700,000 in principal from us, plus $1,219,520 in principal from all defendants, $200,000 from Fadi Nora, and other unspecified amounts.On April 20, 2011, the court entered default judgments against Fadi Nora, Play Beverages, LLC, and us.The default judgments were set aside pursuant to a stipulation and the court granted defendants leave to file an answer, cross complaint, and a motion to recuse opposing counsel.Plaintiffs have opposed the cross complaint.We are seeking to negotiate a settlement of this matter. These amounts have been accrued in full as a liability. Globe Express Services, v. CirTran Beverage Corp., Third District Court, Salt Lake County, Case No. 110914239.In June 2011, we were sued by plaintiff, which seeks approximately $58,000 for services rendered.We did not file a responsive pleading and after December 31, 2011, settled this matter for $15,000, payable in monthly installments of $5,000.",
"The first installment of $5,000 was paid in March 2012. These amounts have been accrued in full as a liability. Alix Technologies v. CirTran d/b/a CirTran Beverage Corp, Third District Court, West Jordan, Case No. 110407015.Plaintiff filed suit in May 2011 claiming that CirTran Beverage had failed to pay for goods, services, or merchandise provided by plaintiff.Defendant filed its answer denying the substantive allegations.CirTran Beverage is reviewing the pleadings and its options and intends to defend against the claims brought. Other Matters United Medical Devices, LLC, v. PlaySafe, LLC, Iehab Hawatmeh, and Fadi Nora, Superior Court of the State of California, in and for the County of Los Angeles, West District, Case No. SC113081 (“UMD #1”), and PlaySafe, LLC and Play Beverages, LLC, v. United Medical Devices, LLC, United Licensing Group, Jimmy Esebag, Patrick Bertranou, and Does 1 through 50, inclusive,Superior Court of the State of California, in and for the County of Los Angeles, West District, Case No. SC113149 (“UMD #2”).In May 2011, Plaintiffs PlaySafe, LLC (“PlaySafe”) and PlayBeverages, LLC (“PlayBev”), brought suit against United Medical Devices (“UMD”), United Licensing Group (“ULG”), Jimmy Esebag, and Patrick Bertranou in Utah, alleging breach of contract, breach of the covenant of good faith and fair dealing, tortious interference with contract, fraud, and negligent misrepresentation, and seeking damages and punitive damages.That case was dismissed for lack of personal jurisdiction over defendants.Subsequently, in June 2011, UMD sued PlaySafe, PlayBev, Iehab Hawatmeh, and Fadi Nora, alleging breach of contract, fraudulent misrepresentation, promissory fraud, and fraudulent concealment.Also in June 2011, PlaySafe and PlayBev sued UMD, ULG, Esebag, and Bertranou alleging breach of contract, breach of the covenant of good faith and fair dealing, tortious interference with contract, tortious interference with prospective business relationship, fraud/deceit, negligent misrepresentation, and misappropriation of trade secrets.In UMD #1, defendants PlaySafe, PlayBev, and Messrs. Hawatmeh and Nora filed demurrers on all claims except the breach of contract claims.In UMD #2, plaintiffs PlaySafe and PlayBev filed a motion seeking a temporary restraining order requiring defendants to provide products and to cease contacting plaintiffs’ distributor contacts, but it was not granted.UMD #2 has been consolidated into UMD #1 for further proceedings.We are pursuing this litigation, now in discovery, vigorously.",
"21 Redi FZE v. CirTran Beverage Corp, in the Third District Court, Salt Lake County, State of Utah, Civil No. 110915101.In a complaint filed in June 2011, Redi asserted claims for breach of contract, fraud, and negligent misrepresentations.CirTran Beverage Corp. filed a counterclaim for breach of contract, breach of the covenant of good faith and fair dealing, and a third-party claim for tortious interference against Paul Levin.On November 21, 2011, the court granted an injunction against Redi FZE, enjoining it from manufacturing, marketing, or distributing any nonalcoholic beverages identified by the trademarked Playboy, PlayBev, and Play Beverages names or the Playboy rabbit head design in the United Kingdom, France, or the Netherlands through June 13, 2013.We believe that Redi FZE’s claims are without merit and intend to defend them vigorously. We do not consider it necessary to accrue a liability for the potential liability. Play Beverages, LLC, After Bev Group, LLC,, CirTran Beverage Corporation,, CirTran Corporation, Iehab Hawatmeh, and Fadi Nora v. Warner K Depuy, et al., Third District Court, Salt Lake City, Utah, case no.",
"100907700.The plaintiffs allege tortuous interference with contractual relations, breaches of fiduciary duty, and fraud and negligent misrepresentations and seek a declaratory judgment determining the rights of the parties, damages to be determined at trial, costs, and attorney’s fees. A default certificate was filed by the plaintiffs for the failure of the defendants to respond and then withdrawn, and there have been no further proceedings. In addition to the foregoing, we are parties to ordinary routine litigation incidental to our business that, individually and in the aggregate, is not material. ITEM 4.MINE SAFETY DISCLOSURES Not applicable.",
"22 PART II ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded in the over-the-counter market.The following table sets forth for the respective periods indicated the prices of the common stock in the over-the-counter market, as reported and summarized by the OTC Bulletin Board.Such prices are based on inter-dealer bid and asked prices, without markup, markdown, commissions, or adjustments and may not represent actual transactions. Low High 2012: First Quarter (through March 31, 2012) $ $ 2011: Fourth Quarter Third Quarter Second Quarter First Quarter 2010: Fourth Quarter Third Quarter Second Quarter First Quarter As of April 16, 2012, we had approximately 3,000 shareholders. We have not declared any dividends on our common stock since our inception, and do not intend to declare any such dividends in the foreseeable future. Our ability to pay dividends is subject to limitations imposed by Nevada law. Under Nevada law, dividends may be paid to the extent the corporation’s assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business. Recent Sales of Unregistered Securities During the year ended December 31, 2011 we issued 96,329,366 shares of common stock for settlement of $179,494 in accrued liabilities and 184,000,000 shares for settlement of $824,300 in debt and short-term advances During 2011, we accrued to employees and consultants five-year options to purchase 22,400,000 shares of common stock, exercisable between $0.0021 and $0.0030 per share.",
"During 2011, we issued to consultants five year options to purchase 40,000,000 shares of common stock, exercisable at $0.0001. These options were exercised during the year. On January 24, 2011, we issued to YA Global a warrant to purchase 25,000,000 shares of common stock at an exercise price of $0.02 per share, expiring December 2015. 23 In February, 2012, we issued to consultants five year options to purchase 20,000,000 shares of common stock, exercisable at $0.0001. These options were immediately exercised. The options and warrants were issued without registration under the Securities Act of 1933 in reliance on Section 4(2) of that Act and the rules and regulations promulgated thereunder.No underwriter participated in such transactions, and no proceeds were received therefrom. Penny Stock Rules Our shares of common stock are subject to the “penny stock” rules of the Securities Exchange Act of 1934 and various rules under this Act.In general terms, “penny stock” is defined as any equity security that has a market price less than $5.00 per share, subject to certain exceptions.The rules provide that any equity security is considered to be a penny stock unless that security is registered and traded on a national securities exchange meeting specified criteria set by the SEC, authorized for quotation from the NASDAQ stock market, issued by a registered investment company, and excluded from the definition on the basis of price (at least $5.00 per share), or based on the issuer’s net tangible assets or revenues.In the last case, the issuer’s net tangible assets must exceed $3,000,000 if in continuous operation for at least three years, $5,000,000 if in operation for less than three years, or the issuer’s average revenues for each of the past three years must exceed $6,000,000.",
"Trading in shares of penny stock is subject to additional sales practice requirements for broker-dealers that sell penny stocks to persons other than established customers and accredited investors.Accredited investors, in general, include individuals with assets in excess of $1,000,000 or annual income exceeding $200,000 (or $300,000 together with their spouse), and certain institutional investors.For transactions covered by these rules, broker-dealers must make a special suitability determination for the purchase of the security and must have received the purchaser’s written consent to the transaction prior to the purchase.Additionally, for any transaction involving a penny stock, the rules require the delivery, prior to the first transaction, of a risk disclosure document relating to the penny stock.A broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative and current quotations for the security.Finally, monthly statements must be sent disclosing recent price information for the penny stocks.These rules may restrict the ability of broker-dealers to trade or maintain a market in our common stock, to the extent it is penny stock, and may affect the ability of shareholders to sell their shares. ITEM 6.SELECTED FINANCIAL DATA Not required.",
"ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW We manufacture, market, and distribute internationally an energy drink under a license, now in dispute, with Playboy Enterprises, Inc. (“Playboy”), and in the U.S., we provide a mix of high- and medium-volume turnkey manufacturing services and products using various high-tech applications for leading electronics OEMs (original equipment manufacturers) in the communications, networking, peripherals, gaming, law enforcement, consumer products, telecommunications, automotive, medical, and semiconductor industries.Our services include pre-manufacturing, manufacturing, and post-manufacturing services.Our goal is to offer customers the significant competitive advantages that can be obtained from manufacture outsourcing. 24 We are engaged in the following business segments. Beverage Distribution (96% and 85% of total revenue during 2011 and 2010, respectively) CirTran Beverage manufactures, markets, and distributes Playboy-licensed energy drinks in accordance with an agreement we entered into with Play Beverages, LLC, or PlayBev, a consolidated variable interest entity, which holds the Playboy license.",
"Contract Manufacturing (4% and 1% of total revenue during 2011 and 2010, respectively) CirTran Products pursues contract-manufacturing relationships in the U.S. consumer products markets, including licensed merchandise sold in the sports and entertainment markets. CirTran - Asia manufactures and distributes electronics, consumer products, and general merchandise to companies selling in international markets. For the year ended December 31, 2011 we recognized approximately $131,000 of royalty revenue. Marketing and Media (0% and 12% of total revenue during 2011 and 2010, respectively) CirTran Online sells products via the Internet and provides services and support to Internet retailers. CirTran Media provides end-to-end services to the direct-response and entertainment industries.",
"Electronics Assembly (0% and 2% of total revenue during 2011 and 2010, respectively) Cirtran Corporation (“CirTran USA”) provides low-volume electronics assembly activities consisting primarily of placing and attaching electronic and mechanical components on printed circuit boards and flexible (i.e., bendable) cables. During 2011, our activities were significantly restrained by the necessity to devote priority to efforts to obtaining the forbearance of our principal secured and judgment creditors, negotiating to resolve disputes respecting the PlayBev license to market Playboy-licensed energy drinks, defending the numerous lawsuits to which we are a party, and obtaining additional capital.Disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks impaired our ability to establish new distributors, damaged our relationships with existing distributors, and depressed revenues.All of our activities during the year, as in previous years, were adversely affected by our severe shortages of working capital and cash. 25 RESULTS OF OPERATIONS Comparison of Years Ended December 31, 2011 and 2010 Sales and Cost of Sales Net sales for the year ended December 31, 2011, totaled $3,064,438, as compared to $9,044,902 for the year ended December 31, 2010.The decrease is primarily attributable to issues related to PlayBev’s bankruptcy case and the uncertainty created by Playboy in relation to the interference with our beverage distributors and defend against numerous lawsuits.Additionally, disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks decreased revenues.Net sales in the contract manufacturing segment rose $53,637 in the year ended December 31, 2011, as compared to the same period in 2010.Net sales in the marketing and media segment fell by $1,095,086 in 2011 as compared to 2010, due to our suspension of most external marketing activities.Beverage distribution revenue decreased to $2,943,921 for the year ended December 31, 2011, as compared to $7,712,492 for the year ended December 31, 2010.The decrease was driven by disputes respecting the status of the PlayBev license to market Playboy-licensed energy drinks which damaged our relationships with existing distributors.",
"Cost of sales, as a percentage of sales, decreased to 36% for the year ended December 31, 2011, as compared to 65% for the prior year ended December 31, 2010.Consequently, the gross profit margin increased to 64% from 35%, respectively, for the same period.The increase in gross profit margin is attributable to an increase in revenues from royalty agreements which have an overall lower cost. The following chart presents comparisons of sales, cost of sales, royalty expense, and gross profit or loss margin generated by our four operating segments, i.e., beverage distribution, contract manufacturing, marketing and media, and electronics assembly during 2011 and 2010: Segment Year Sales Cost of Sales Royalty Expense Gross Loss / Margin Electronics Assembly $"
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
|
Appellant was convicted of unlawfully engaging in the business or occupation of selling intoxicating liquor in prohibition territory, and assessed the lowest punishment. The indictment laid the offense as committed on or about July 1, 1915, and alleged sales to given persons on that date and on December 25, 1915, and March 26, 1916. The indictment was not preferred until April 18, 1916. Of course, the offense laid would embrace a period of three years prior and up to the date of the filing of the indictment. Prohibition was admitted to have been in effect in said county for more than three years before the indictment herein was filed. J.T. Sewell, agent of the express and railroad companies at Daingerfield, produced his books and therefrom testified to deliveries of whisky to appellant as follows: In 1915: June 17th, 4 quarts; August 7th, 4 quarts; October 1st, 4 quarts; October 10th, 6 quarts; October 18th, 4 quarts; October 23rd, 2 quarts; November 2d 24 pints; November 8th, 12 quarts; November 12th, 24 pints; November 16th, 24 pints; November 22d 12 pints; November 26th, 8 quarts; December 2d 24 pints; December 7th, 24 pints; December 11th, 12 quarts; December 17th, 6 quarts, making in all sixteen separate and distinct shipments and deliveries to him in six months and aggregating 128 quarts. Then in 1916; January 4th, 6 quarts; January 10th, 12 quarts; January 17th, 12 quarts; February 11th, 6 quarts; February 14th, 12 quarts; February 25th, 6 quarts; March 8th, 12 quarts; March 24th, 6 quarts; March 30th, 4 quarts, making in all eleven separate and distinct deliveries within three months, and a total of 94 quarts. Raymond Rhody, to whom sales were alleged to have been made, swore that on December 26, 1915, he bought two pints of whisky from appellant — as we understand, this was two separate and distinct sales of a pint each on said date; that on March 26, 1916, he bought another part of a bottle from appellant and paid him six bits therefor; that at the first time he bought the whisky, appellant had four or five quarts on hand, and at another time he bought from him he had seven or eight pints on hand; that the whisky was in a box, in his place of business, *Page 385 under a counter, and at the time appellant was selling things to eat. Mr. Sewell swore that the express company's books which he produced and from which he showed the several deliveries to appellant were the books kept expressly for whisky shipments; that the collect packages were kept in one and the prepaid packages in another book; that to those receipts of shipments appellant's name was signed and that said records showed it to have been in different handwritings; that he did not know who signed for the packages where these different handwritings were signed. He said: "I have known of instances and have had several people come around and ask if John Jackson had any whisky there. Then later on Jackson would come and get the whisky. I have had that to occur a number of times." On redirect examination he swore: "If whisky is consigned to John Jackson, John Jackson will have to come and sign for it. The consignee has to come and sign for the whisky. With reference to those inquiries I don't know whether or not they wanted Jackson to get it out so that they could buy some. They may have made the inquiry in order to purchase it from him for all I know." Appellant himself testified and swore in effect that he had the said shipments of whisky made to him. He claimed, however, that the whisky was not always for himself, that some of it was for other people — white friends of his. He denied ever having sold any whisky at any time to said witness Rhody. On cross-examination he swore that in the summer time he ran an ice cream parlor and in the winter time ran a restaurant and sold stews and chili; that he did not order and get and sign for all the whisky shown by the express company's books; that there was some came for him that he knew nothing about and never signed for at all; that he drank some of the whisky but not all, it was not all his. He said: "I did not order whisky for white people, but they asked me if they could use my name and send my name to the whisky houses. Then they would get me to go and get it out. I can name some of the men who did that, but I don't want to leave here; I would like to stay. I can name some of the men I got whisky for, but I don't want to." He claimed to have gotten some for Mr. Heard, and he said that Mr. Heard was one who ordered whisky in his name, and that Mr. Joe Bradfield was another; that he did not know how many times he had ordered it for Mr. Bradfield. He said: "I don't know of any others except those two who got whisky in my name; that is all I can think of, just those two men." That he thought Mr. Heard got whisky in the way he said in his name, about ten or fifteen times. He swore that lots of days he did not drink much whisky and sometimes went a week at a time and never drank a drop and sometimes a month at a time without drinking. Mr. Heard testified that he did not use appellant's name ten or fifteen times in ordering whisky for himself. He swore that sometimes he and others got together and ordered as much as a case at a time, and *Page 386 he said some of the boys might have ordered it through appellant. On cross-examination he said that he never ordered a case from appellant in his life; that he may have had some whisky in an order but never as much as four quarts; that he never got any in pints. The evidence was undoubtedly sufficient to sustain the conviction. The court was correct in permitting the said Rhody, over appellant's objection, to testify that on March 26, 1916, when he bought some whisky from appellant that appellant then had on hand five or six quarts of whisky; and that at another time when he bought from him that he had on hand seven or eight pints of whisky. That testimony was clearly admissible. The respective dates and quantities of whisky received by appellant from the express company is shown above. He objected to the proof that on June 17, 1915, he got four quarts, on August 7th four quarts, and on October 1st four quarts, on the ground that said testimony was immaterial and the deliveries too remote from the offense charged. The court explained in his approval of the bill that because appellant was charged with pursuing the business or occupation as stated he admitted the receipt by him of the large quantities of whisky as tending to show he was engaged in the business at the time charged. As stated above, the offense was laid on July 1st, but embraced the whole period from the time the indictment was filed for three years before. These three respective shipments to which he objected were clearly not too remote and were admissible for the purpose as stated by the court. The court did not err in refusing to permit the witness Sewell to testify as shown by another bill of appellant's that while he was working for the express company at Daingerfield he knew it to be a fact that white people often ordered whisky in the name of negroes and then came to said express office and got it out, or found out whether it had come and then went out and hunted the negroes up and had them come in and sign for it, and that appellant was a negro. This testimony of what others did having no connection with appellant, was properly excluded. The judgment is affirmed. Affirmed. | 07-06-2016 | [
"Appellant was convicted of unlawfully engaging in the business or occupation of selling intoxicating liquor in prohibition territory, and assessed the lowest punishment. The indictment laid the offense as committed on or about July 1, 1915, and alleged sales to given persons on that date and on December 25, 1915, and March 26, 1916. The indictment was not preferred until April 18, 1916. Of course, the offense laid would embrace a period of three years prior and up to the date of the filing of the indictment. Prohibition was admitted to have been in effect in said county for more than three years before the indictment herein was filed. J.T. Sewell, agent of the express and railroad companies at Daingerfield, produced his books and therefrom testified to deliveries of whisky to appellant as follows: In 1915: June 17th, 4 quarts; August 7th, 4 quarts; October 1st, 4 quarts; October 10th, 6 quarts; October 18th, 4 quarts; October 23rd, 2 quarts; November 2d 24 pints; November 8th, 12 quarts; November 12th, 24 pints; November 16th, 24 pints; November 22d 12 pints; November 26th, 8 quarts; December 2d 24 pints; December 7th, 24 pints; December 11th, 12 quarts; December 17th, 6 quarts, making in all sixteen separate and distinct shipments and deliveries to him in six months and aggregating 128 quarts. Then in 1916; January 4th, 6 quarts; January 10th, 12 quarts; January 17th, 12 quarts; February 11th, 6 quarts; February 14th, 12 quarts; February 25th, 6 quarts; March 8th, 12 quarts; March 24th, 6 quarts; March 30th, 4 quarts, making in all eleven separate and distinct deliveries within three months, and a total of 94 quarts.",
"Raymond Rhody, to whom sales were alleged to have been made, swore that on December 26, 1915, he bought two pints of whisky from appellant — as we understand, this was two separate and distinct sales of a pint each on said date; that on March 26, 1916, he bought another part of a bottle from appellant and paid him six bits therefor; that at the first time he bought the whisky, appellant had four or five quarts on hand, and at another time he bought from him he had seven or eight pints on hand; that the whisky was in a box, in his place of business, *Page 385 under a counter, and at the time appellant was selling things to eat.",
"Mr. Sewell swore that the express company's books which he produced and from which he showed the several deliveries to appellant were the books kept expressly for whisky shipments; that the collect packages were kept in one and the prepaid packages in another book; that to those receipts of shipments appellant's name was signed and that said records showed it to have been in different handwritings; that he did not know who signed for the packages where these different handwritings were signed. He said: \"I have known of instances and have had several people come around and ask if John Jackson had any whisky there.",
"Then later on Jackson would come and get the whisky. I have had that to occur a number of times.\" On redirect examination he swore: \"If whisky is consigned to John Jackson, John Jackson will have to come and sign for it. The consignee has to come and sign for the whisky. With reference to those inquiries I don't know whether or not they wanted Jackson to get it out so that they could buy some. They may have made the inquiry in order to purchase it from him for all I know.\" Appellant himself testified and swore in effect that he had the said shipments of whisky made to him.",
"He claimed, however, that the whisky was not always for himself, that some of it was for other people — white friends of his. He denied ever having sold any whisky at any time to said witness Rhody. On cross-examination he swore that in the summer time he ran an ice cream parlor and in the winter time ran a restaurant and sold stews and chili; that he did not order and get and sign for all the whisky shown by the express company's books; that there was some came for him that he knew nothing about and never signed for at all; that he drank some of the whisky but not all, it was not all his. He said: \"I did not order whisky for white people, but they asked me if they could use my name and send my name to the whisky houses.",
"Then they would get me to go and get it out. I can name some of the men who did that, but I don't want to leave here; I would like to stay. I can name some of the men I got whisky for, but I don't want to.\" He claimed to have gotten some for Mr. Heard, and he said that Mr. Heard was one who ordered whisky in his name, and that Mr. Joe Bradfield was another; that he did not know how many times he had ordered it for Mr. Bradfield. He said: \"I don't know of any others except those two who got whisky in my name; that is all I can think of, just those two men.\" That he thought Mr. Heard got whisky in the way he said in his name, about ten or fifteen times. He swore that lots of days he did not drink much whisky and sometimes went a week at a time and never drank a drop and sometimes a month at a time without drinking. Mr. Heard testified that he did not use appellant's name ten or fifteen times in ordering whisky for himself.",
"He swore that sometimes he and others got together and ordered as much as a case at a time, and *Page 386 he said some of the boys might have ordered it through appellant. On cross-examination he said that he never ordered a case from appellant in his life; that he may have had some whisky in an order but never as much as four quarts; that he never got any in pints. The evidence was undoubtedly sufficient to sustain the conviction. The court was correct in permitting the said Rhody, over appellant's objection, to testify that on March 26, 1916, when he bought some whisky from appellant that appellant then had on hand five or six quarts of whisky; and that at another time when he bought from him that he had on hand seven or eight pints of whisky.",
"That testimony was clearly admissible. The respective dates and quantities of whisky received by appellant from the express company is shown above. He objected to the proof that on June 17, 1915, he got four quarts, on August 7th four quarts, and on October 1st four quarts, on the ground that said testimony was immaterial and the deliveries too remote from the offense charged. The court explained in his approval of the bill that because appellant was charged with pursuing the business or occupation as stated he admitted the receipt by him of the large quantities of whisky as tending to show he was engaged in the business at the time charged. As stated above, the offense was laid on July 1st, but embraced the whole period from the time the indictment was filed for three years before. These three respective shipments to which he objected were clearly not too remote and were admissible for the purpose as stated by the court.",
"The court did not err in refusing to permit the witness Sewell to testify as shown by another bill of appellant's that while he was working for the express company at Daingerfield he knew it to be a fact that white people often ordered whisky in the name of negroes and then came to said express office and got it out, or found out whether it had come and then went out and hunted the negroes up and had them come in and sign for it, and that appellant was a negro. This testimony of what others did having no connection with appellant, was properly excluded. The judgment is affirmed. Affirmed."
] | https://www.courtlistener.com/api/rest/v3/opinions/3934807/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
79 F.3d 1166 NOTICE: Federal Circuit Local Rule 47.6(b) states that opinions and orders which are designated as not citable as precedent shall not be employed or cited as precedent. This does not preclude assertion of issues of claim preclusion, issue preclusion, judicial estoppel, law of the case or the like based on a decision of the Court rendered in a nonprecedential opinion or order.Dolores M. WILLIAMS, Petitioner,v.MERIT SYSTEMS PROTECTION BOARD, Respondent. No. 96-3068. United States Court of Appeals, Federal Circuit. March 4, 1996. ORDER
1 The petitioner having failed to pay the docketing fee required by Federal Circuit Rule 52(a)(1) within the time permitted by the rules, it is
2 ORDERED that the petition for review be, and the same hereby is, DISMISSED, for failure to prosecute in accordance with the rules. | 04-17-2012 | [
"79 F.3d 1166 NOTICE: Federal Circuit Local Rule 47.6(b) states that opinions and orders which are designated as not citable as precedent shall not be employed or cited as precedent. This does not preclude assertion of issues of claim preclusion, issue preclusion, judicial estoppel, law of the case or the like based on a decision of the Court rendered in a nonprecedential opinion or order.Dolores M. WILLIAMS, Petitioner,v.MERIT SYSTEMS PROTECTION BOARD, Respondent. No. 96-3068. United States Court of Appeals, Federal Circuit. March 4, 1996. ORDER 1 The petitioner having failed to pay the docketing fee required by Federal Circuit Rule 52(a)(1) within the time permitted by the rules, it is 2 ORDERED that the petition for review be, and the same hereby is, DISMISSED, for failure to prosecute in accordance with the rules."
] | https://www.courtlistener.com/api/rest/v3/opinions/715590/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA
JESSICA A. SAFRONSKY, : : CIVIL ACTION Plaintiff, : : v. : : NO. 16-4002 NANCY A. BERRYHILL, : Acting Commissioner of Social Security : : Defendant. :
Goldberg, J. January 7, 2019
MEMORANDUM
Currently before me are Plaintiff Jessica A. Safronsky’s Objections to the Report and
Recommendation of United States Magistrate Judge David R. Strawbridge. Upon review of the
entire record and the comprehensive Opinion written by Judge Strawbridge, I adopt the Report and
Recommendation and affirm the Commissioner’s finding on disability. However, given the
difficult and sensitive issues raised by the record and identified by Plaintiff in her Objections, I
write in more detail to explain why I am adopting Judge Strawbridge’s Report.
I. BACKGROUND
In September 2008, Plaintiff first applied for Disability Insurance Benefits and
Supplemental Security Income, under Titles II and XVI respectively of the Social Security Act, 42
U.S.C. § 401, et seq. Plaintiff alleged disability due to a learning disorder. Her claim was denied
and Plaintiff did not pursue an appeal. She reapplied in January 2010, again alleging disability
resulting from a learning disorder and slow motor skills. This claim was also denied. Plaintiff filed a new application on April 19, 2011, asserting a disability onset date of
October 25, 2009. The state agency denied her application in August 2011, and Plaintiff requested
an administrative hearing. Following the hearing, the ALJ issued a decision, dated November 16,
2012, finding Plaintiff not disabled. Plaintiff appealed to this Court. The Honorable William H.
Yohn, Jr. granted the Commissioner’s motion to remand and ordered the ALJ to engage a medical
expert to assist in determining whether Plaintiff satisfied two particular criteria of Listing 12.05.
On December 8, 2015, the same ALJ held a second administrative hearing where Plaintiff,
a vocational expert, and a medical expert testified. The ALJ then issued a new decision on March
30, 2016, finding Plaintiff not disabled because she did not meet or equal any of the Listings of
Impairments in the Social Security regulations and was capable of performing jobs that existed in
significant numbers in the national economy.
Plaintiff filed the present litigation on July 25, 2016, challenging the ALJ’s decision.
United States Magistrate Judge David R. Strawbridge issued a Report and Recommendation
(“R&R”) finding that the ALJ’s decision was supported by substantial evidence. On June 7, 2018,
Plaintiff filed objections to that R&R.1
1 Where a United States Magistrate Judge has issued a report and recommendation in a social security case and a party makes a timely and specific objection to that report and recommendation, the district court is obliged to engage in de novo review of only those issues raised on objection. 28 U.S.C. § 636(b)(1); see also Sample v. Diecks, 885 F.2d 1099, 1106 n.3 (3d Cir. 1989). For those sections of the report and recommendation to which no objection is made, the court should, as a matter of good practice, “satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.” Fed. R. Civ. P. 72(b), advisory committee notes. The court may “accept, reject, or modify, in whole or in part, the findings and recommendations” contained in the report. 28 U.S.C. § 636(b)(1). In the exercise of sound judicial discretion, the court may also rely on the Magistrate Judge’s proposed findings and recommendations. See United v. Raddatz, 447 U.S. 667, 676 (1980).
2 II. STANDARD OF REVIEW
As discussed by Judge Strawbridge, judicial review of the Commissioner’s decision is
limited to determining whether “substantial evidence” supports the decision. Burnett v. Comm’r
of Soc. Sec. Admin., 220 F.3d 112, 118 (3d Cir. 2000). “Substantial evidence ‘does not mean a
large or considerable amount of evidence, but rather such relevant evidence as a reasonable mind
might accept as adequate to support a conclusion.’” Hartranft v. Apfel, 181 F.3d 358, 360 (3d Cir.
1999) (quoting Pierce v. Underwood, 487 U.S. 552, 564–65 (1988)). When making this
determination, a reviewing court may not undertake a de novo review of the Commissioner’s
decision and may not re-weigh the evidence of record. Monsour Med. Ctr. v. Heckler, 806 F.2d
1185, 1190 (3d Cir. 1986). In other words, even if the reviewing court would have decided the
case differently, the Commissioner’s decision must be affirmed if it is supported by substantial
evidence. Id. at 1190–91; see also Gilmore v. Barnhart, 356 F. Supp. 2d 509, 511 (E.D. Pa. 2005)
(holding that the court’s scope of review is “limited to determining whether the Commissioner
applied the correct legal standards and whether the record, as a whole, contains substantial
evidence to support the Commissioner’s findings of fact”) (quoting Schwartz v. Halter, 134 F.
Supp. 2d 640, 647 (E.D. Pa. 2001)). In an adequately developed factual record, substantial
evidence may be “something less than the weight of the evidence, and the possibility of drawing
two inconsistent conclusions from the evidence does not prevent [the ALJ’s decision] from being
supported by substantial evidence.” Consolo v. Fed. Maritime Comm’n, 383 U.S. 607, 620 (1966).
III. PLAINTIFF’S OBJECTIONS
Plaintiff raises two general objections to the R&R. First, she contends that Judge
Strawbridge erred in affirming the ALJ’s determination that Plaintiff’s intellectual disability did
3 not meet or equal Listing 12.05. Second, she claims that the ALJ erred in review of various
examining and non-examining doctors.
A. Listings Analysis
Plaintiff’s first objection concerns the ALJ’s review at step three of the sequential analysis.
At this step, the ALJ must determine whether the claimant’s impairment matches, or is equivalent
to one of the listed impairments. Burnett v. Comm’r of Soc. Sec. Admin., 220 F.3d 112, 119 (3d
Cir. 2000). The listings describe impairments that prevent an adult, regardless of age, education
or work experience, from performing “any gainful activity.” 20 C.F.R. §§ 404.1525(a);
1416.925(a); Knepp v. Apfel, 204 F.3d 78, 85 (3d Cir. 2000). “If the impairment is equivalent to
a listed impairment, then [the claimant] is per se disabled and no further analysis is necessary.”
Burnett, 220 F.3d at 119. While the burden is on the claimant to present medical findings to show
that his or her impairment meets or equals a listing, the ALJ should identify the closest applicable
impairment, fully develop the record, and explain whether and why the claimant’s impairments
are or are not equivalent in severity to one of the listed impairments. Id. at 120 n.2.
At issue in this case is Listing 12.05 of the Social Security regulations, which deals with
intellectual disorders. The introductory paragraph of 12.05 explains that such disorders are
“characterized by significantly subaverage general intellectual functioning, significant deficits in
current adaptive functioning, and manifestation of the disorder before age 22.” Listing 12.05,
Mental Retardation, 20 C.F.R. Pt. 404, Subpt. P, App. 1 (effective Mar. 24, 2011 to June 6, 2011).
The Listing goes on to state that:
The required level of severity for this disorder is met when the requirements in A, B, C, or D are satisfied.
A. Mental incapacity evidenced by dependence upon others for personal needs (e.g., toileting, eating, dressing, or bathing) and
4 inability to follow directions, such that the use of standardized measures of intellectual functioning is precluded;
Or
B. A valid verbal, performance, or full scale IQ of 59 or less;
Or
C. A valid verbal, performance, or full scale IQ of 60 through 70 and a physical or other mental impairment imposing an additional and significant work-related limitation of function;
Or
D. A valid verbal, performance, or full scale IQ of 60 through 70, resulting in at least two of the following:
1. Marked restriction of activities of daily living; or 2. Marked difficulties in maintaining social functioning; or 3. Marked difficulties in maintaining concentration, persistence, or pace; or 4. Repeated episodes of decompensation, each of extended duration.
Id. “As the disjunctive language of the Listing indicates, the required level of severity for this
disorder is met when the requirements of both the introductory paragraph and paragraph A, B, C
or D of the Listing are satisfied.” Simon v. Berryhill, No. 16-1533, 2017 WL 4842416, at *2
(W.D. Pa. Oct. 26, 2017). An impairment that meets only some of the criteria, “no matter how
severely, does not qualify” for a per se disability determination. Sullivan v. Zebley, 493 U.S. 521,
530 (1990).
To satisfy part C—which is the specific subpart at issue here—a plaintiff must have “1)
significantly subaverage intellectual functioning with deficits in adaptive behavior initially
manifested during developmental period (i.e., before age 22); 2) a valid verbal, performance, or
full scale IQ of 60 through 70; and 3) a physical or other mental impairment imposing an additional
and significant work-related limitation or function.” Simon, 2017 WL 4842416, at *2 (emphasis
5 in original) (citing 20 C.F.R. pt. 404, subpt. P., app. 1 § 12.05C; Williams v. Sullivan, 970 F.2d
1178, 1184 (3d Cir. 1992)); see also Illig v. Comm’r Soc. Sec., 570 F. App’x 262, 265 (3d Cir.
2014).
Here, the ALJ reviewed the criteria of Listing 12.05C and concluded that Plaintiff did not
meet or equal that Listing. Focusing on the first element of 12.05C in particular, the ALJ remarked
that Plaintiff did not show deficits in adaptive behavior. The ALJ based her decision, in part, on
the testimony of medical expert Dr. Fuess that, “the claimant does not display the level of adaptive
deficits that one would expect to find in an individual with mild mental retardation.” (R. 435.)
The ALJ further relied on Plaintiff’s school records, social functioning, and activities of daily
living and found:
The record shows that the claimant was able to graduate high school with the assistance of learning support services with grades ranging from “B’s” to “D’s”. Her school records show that she has good verbal and good reading comprehension skills. They also show that she has developed good social skills and that she gets along with her peers. Claimant’s mental health treatment records also mention that the claimant enjoys reading and working on crossword puzzles . . .
While claimant’s poor work history may suggest occupational deficits in adaptive functioning, it is not known how many jobs were lost because of poor job performance. It is known that some were lost for reasons other than poor performance. In May 2010, the claimant reported that she stopped working because she was being harassed by a coworker. . . . In July 2010, the claimant reported that she had to stop working because of dizziness. . . . Some jobs may have been lost because they involved more skilled types of work. The claimant reports having to leave at least one job because she was unable to multitask. . . . Moreover, it is not known how many jobs may have been lost because of poor motivation to work. Claimant’s school records show that she “works steadily when interested” and that she “performs well academically when in school” (suggesting a problem with motivation). ...
The undersigned finds that claimant’s mental disorder is only mildly interfering with her activities of daily living. The record shows that
6 the claimant cooks, cleans, and takes care of her daily needs. . . . Her mental health treatment records show that she always presents appropriately dressed and groomed for her therapy sessions.
(R. 436 (emphasis in original).)
On review, Judge Strawbridge concluded that substantial evidence supported the ALJ’s
determination that Plaintiff did not have deficits in adaptive functioning during the developmental
period. Accordingly, he declined to set aside the ALJ’s step three finding. Plaintiff now argues
that this determination was erroneous on several grounds.
First, Plaintiff urges that the ALJ improperly equated her ability to perform activities of
daily living with her ability to perform full-time competitive work. The determination of whether
a claimant has deficits in adaptive behavior requires an ALJ to consult any one of four professional
organizations that work with mental retardation for the measurement criteria. See Technical
Revisions to Medical Criteria for Determinations of Disability, 67 FR 20018 (April 24, 2002); see
also Logan v. Astrue, No. 07-1472, 2008 WL 4279820 at *8 (W.D. Pa. Sept.16, 2008). One of the
authorized resources is the American Psychiatric Association’s Diagnostic and Statistical Manual
of Mental Disorders (5th ed.) (“DSM-V”).2 Jones v. Colvin, No. 14-282, 2015 WL 3646313, at *5
2 Although the ALJ did not explicitly state which definition of “adaptive functioning” she applied, it is abundantly obvious that she used the definition of “intellectual disability” set forth in the DSM-V. The ALJ considered factors such as activities of daily life, communication, social participation, and independent living across multiple environments such as home, school, and work. While the ALJ should have, in the interest of thoroughness, expressly indicated the definition of “adaptive functioning” upon which she relied, Plaintiff’s objections do not challenge that aspect of the ALJ’s decision. Moreover, “[n]o authority exists that states that an ALJ must definitely state which definition was applied.” Jones v. Colvin, No. 14-282, 2015 WL 3646313, at *8 (W.D. Pa. June 10, 2015). Rather, it is sufficient that the ALJ addressed each of the criteria used to evaluate Plaintiff’s deficits. Id.; compare Harper v. Colvin, No. 13-446, 2014 WL 1278094, at *8 (W.D. Pa. Mar. 27, 2014) (declining to require an ALJ to articulate one specific standard where he “sufficiently explained the benchmark he used to arrive at his conclusion”),
7 (W.D. Pa. June 10, 2015). The DSM-V defines deficits in adaptive functioning as “how well a
person meets community standards of personal independence and social responsibility, in
comparison to others of similar age and sociocultural background.” DSM-V at 37. Such deficits
“limit functioning in one or more activities of daily life, such as communication, social
participation, and independent living, across multiple environments, such as home, school, work,
and community.” Id. at 33 (emphasis added). The requisite deficits are present when at least one
of the three domains of adaptive functioning (conceptual, social, and practical) is sufficiently
impaired that ongoing support is needed in order for the person to perform adequately in one or
more life settings at school, at work, at home, or in the community. See id. at 38.
Under the DSM-V’s definition, the ALJ was required to consider Plaintiff’s activities of
daily living. The ALJ detailed her reasoning as to each category of activities and, therefore,
satisfied the substantial evidence standard.3 Accordingly, I do not agree with this portion of
Plaintiff’s objections.
with Gruden v. Astrue, No. 10-569, 2011 WL 4565502, at *5 (W.D. Pa. Sept. 29, 2011) (remanding “so the ALJ can explain what measurement method he used to determine whether plaintiff has established that she has deficits in adaptive functioning.”).
3 See, e.g., Mastarone v. Berryhill, No. 16-1421, 2018 WL 783678, at *4 (W.D. Pa. Feb. 8, 2018) (affirming ALJ’s conclusion of no deficits in adaptive functioning where record showed that claimant (a) could read English with fair vocabulary and count change, even though he dropped out of school in 8th grade, (b) maintained “skilled work as a mechanic” for five years, (c) demonstrated empathy, interpersonal communication, and social skills by virtue of his relationships with his girlfriend and family; and (c) was “able to perform a full range of activities of daily living including caring for his personal needs, preparing simple meals, shopping by phone, watching television, and utilizing public transportation.”); Harper v. Colvin, No. 13-446, 2014 WL 1278094 at * 8 (W.D. Pa. March 27, 2014) (affirming the ALJ’s conclusion that the claimant did not have deficits in adaptive functioning where the claimant completed high school, worked in jobs requiring some skill prior to the alleged onset date, managed her own finances, drove, cared for herself, shopped for groceries, and raised two sons); Gibbs v. Comm’r. of Soc. Sec., 686 F. App’x 799, 802 (11th Cir. 2017) (holding that substantial evidence supported the ALJ’s finding that the claimant did not have deficits in adaptive functioning where she lived alone at times and, with her mother’s help, cared for her daughter, did her own laundry, cleaned her home, cooked 8 Second, Plaintiff argues that her inability to sustain employment—having held over sixty
jobs between 1995 and 2009—is one of “many concrete manifestations” of her adaptive
functioning deficits. (Pl.’s Objections 3.) The ALJ properly concluded that this “scattershot work
history” did not conclusively establish a deficit in adaptive functioning. As detailed above, the
ALJ remarked that the record contained no evidence that Plaintiff’s inability to sustain a job
resulted from deficits in her functioning abilities; rather she found evidence suggesting that other
factors, including Plaintiff’s lack of desire to work, were often responsible for her inability to
maintain employment.
Finally, Plaintiff asserts that her IQ testing from December 2008 and February 2012, which
showed a “mildly retarded range of intellectual functioning,” reflected her adaptive functioning
deficits before age 22. Courts, however, have rejected the notion that low IQ scores used to satisfy
either 12.05B or 12.05C are in and of themselves sufficient to satisfy the Listing 12.05’s separate
requirement of “the existence of deficits in adaptive functioning prior to attaining age 22.” See
Gist v. Barnhart, 67 F. App’x 78, 81 (3d Cir. 2003) (“As is true in regard to any 12.05 listing,
before demonstrating the specific requirements of Listing 12.05C, a claimant must show proof of
a ‘deficit in adaptive functioning’ with an initial onset prior to age 22.”); Lansdowne v. Astrue,
No. 11-487, 2012 WL 4069363 (W.D. Pa. Sept. 17, 2012) (“[P]ursuant to the Regulations and case
law, in order to meet Listing 12.05, a claimant must meet both the introductory-criteria to that
listing requiring ‘significantly subaverage general intellectual functioning with deficits in adaptive
functioning initially manifested [before age 22]’ and the criteria of one of paragraphs A through
D.”) “A valid IQ score need not be treated as conclusive of intellectual disability where the IQ
simple meals, had her driver’s license, handled her own money, was able to shop, and received several passing grades in special education classes in 9th and 10th grades). 9 score is inconsistent with other evidence in the record on the claimant's daily activities and
behavior.” Jones v. Soc. Sec. Admin., Comm’r, 695 F. App’x 507, 509 (11th Cir. 2017). “In other
words, evidence of a claimant’s daily activities and behavior may show that the claimant has a
greater degree of adaptive functioning than suggested by his IQ scores.” Id.
Ultimately, Plaintiff bears the burden of proof to show that she meets or equals the listings
at step three. Gist, 67 F. App’x at 81. Aside from referencing her work history, which— as noted
above—is not sufficient, Plaintiff has not provided evidence establishing that before the age of 22
she had a deficit in adaptive functioning. As such, I find the ALJ’s listing determination to be well
supported by substantial evidence. Accordingly, I decline to remand the ALJ’s Step Three finding.
B. ALJ’s Evaluation of Medical Professional Opinions
Plaintiff’s second objection to the R&R challenges Judge Strawbridge’s adoption of the
ALJ’s findings with respect to the various medical opinion evidence. Specifically, Plaintiff argues
that: (1) the ALJ failed to follow regulatory guidance requiring that deference be accorded to the
opinion by Plaintiff’s treating physician, Dr. Wright; and (2) the ALJ’s weighing of the various
non-treating medical opinions was in error.
1. Dr. Wright
Dr. Wright was Plaintiff’s treating psychologist. On August 11, 2011, Dr. Wright
completed a Mental Impairment Questionnaire and assessed Plaintiff as having limited mental
abilities in several areas of functioning needed for unskilled work, such as understanding and
carrying out short and simple instructions and maintaining regular attendance. Dr. Wright further
remarked that Plaintiff (a) lacked an ability to compete in areas such as making simple work
decisions, and working in coordination with and proximity to others, and (b) had no “useful” ability
to sustain an ordinary routine without special supervision, complete a normal workday or
10 workweek without interruption from her psychological symptoms, or perform at a consistent pace.
(R. 424.) Dr. Wright determined that Plaintiff had only a mild restriction on activities of daily
living, and limited episodes of decompensation, but moderate to marked limitations in social
functioning, and marked to extreme limitations on concentration, persistence and pace. (R. 426.)4
The ALJ addressed Dr. Wright’s opinion as follows:
The undersigned finds that claimant’s mental disorder is no more than moderately interfering with her ability to maintain concentration, persistence or pace. When evaluated by Dr. Bonnie Wright in August 2012, the claimant was considered to have limited but satisfactory ability to understand, remember and carry out very short and simple instructions. . . . When seen in therapy on November 18, 2014, the claimant was described as cooperative and attentive. When more recently seen on May 5, 2015, the claimant was described as alert, well-focused and cooperative. ... The undersigned is also crediting Dr. Bonnie Wright’s opinion that the claimant has limited but satisfactory ability to: understand, remember and carry out very short and simple instructions; to maintain regular job attendance; to interact appropriately with the general public; and to maintain social appropriate behavior. . . . The undersigned is giving little weight to the more restrictive limitations noted by Dr. Wright because they are based in large part upon a finding of mild mental retardation that is not well-supported in the record.
(R. 437.) Judge Strawbridge found this assessment of Dr. Wright’s opinion to be supported by
substantial evidence.
Plaintiff’s current objections reiterate her challenges to the ALJ’s weighing of Dr. Wright’s
testimony and allege that neither the ALJ nor Judge Strawbridge properly evaluated Dr. Wright’s
opinion under the regulatory factors.
I disagree with Plaintiff for several reasons. Primarily, as noted by Judge Strawbridge, it
is well established that although “treating physicians’ opinions are assumed to be more valuable
4 Dr. Wright’s report is more thoroughly described in the R&R. 11 than those of non-treating physicians,” this “assumption does not turn on impermissibly
mechanical deference to the treating physician’s opinion.” Cyprus Cumberland Res. v. Dir., Office
of Workers’ Compensation Programs, 170 F. App’x 787, 792 (3d Cir. 2006) (quotations omitted).
An ALJ’s decision to reject the opinion of a treating physician is proper where the physician’s own
treatment records do not support his/her opinion and the record contains medical evidence contrary
to his/her opinion. See Grogan v. Comm’r of Soc. Sec., 459 F. App’x 132, 137 (3d Cir. 2012); see
also Matney v. Sullivan, 981 F.2d 1016, 1019 (9th Cir. 1992) (“The ALJ need not accept an opinion
of a physician—even a treating physician—if it is conclusory and brief and is unsupported by
clinical findings.”).
Here, as noted in the R&R, substantial evidence undermined the notion that Plaintiff was
as limited as Dr. Wright suggested: psychotherapy notes contemporaneous to the medication
management that Dr. Wright oversaw were benign; Plaintiff was discharged from psychotherapy
because she had achieved all of her therapy goals; there was no record of mental health treatment
after Dr. Wright offered her opinion until, due to developments in her disability claim, Plaintiff
sought out treatment with a new provider in March 2014; and contrary to Dr. Wright’s opinion,
Plaintiff’s activities of daily living showed that she was not as limited as described. (R&R 22.)
Further, Dr. Wright’s opinion was encompassed entirely in a checkbox report with no
written explanation for the limitations she imposed. As the Third Circuit has observed, “[f]orm
reports in which a physician’s obligation is only to check a box or fill in a blank”—as is the case
here—“are weak evidence at best.” Mason v. Shalala, 994 F.2d 1058, 1065 (3d Cir. 1993). This
is particularly true when those residual capacity reports are “unaccompanied by thorough written
reports.” Brewster v. Heckler, 786 F.2d 581, 585 (3d Cir. 1986); see also Santiago v. Astrue, No.
11–3650, 2012 WL 1080181, at *9 (E.D. Pa. Mar. 28, 2012) (“[I]n light of the relatively cursory
12 and checklist format of [the treating physician’s] opinion, the sparsity of the support for her
conclusions in her own records, and the contradictory nature of the medical evidence from [the
plaintiff's] treating therapist, the Court holds that the ALJ was not required to attribute more than
‘little to no weight’ to [the treating physician's] opinion of [the plaintiff’s] mental limitations.”).
Finally, it is notable that the ALJ did not completely reject Dr. Wright’s opinion, but rather
found that it was entitled to limited weight to the extent it was supported by other evidence of
record. Indeed, the ALJ incorporated many of Dr. Wright’s opinions into the residual functional
capacity assessment and found that Plaintiff was capable of performing simple, routine job tasks
with few changes in the work routine, and that the work should be self-paced, not involve detailed
instructions, not require more than occasional interaction with coworkers or the general public,
and not involve occupational hazards. (R. 437.)
Under controlling jurisprudence, the ALJ was not required to blindly accept Dr. Wright’s
opinion without consideration of the entire record. As I agree with Judge Strawbridge that the
ALJ’s decision to reject a portion of Dr. Wright’s assessment was supported by substantial
evidence, I will overrule Plaintiff’s objection on this issue.
2. Drs. Knight, Hamme, Fuess, and McGalliard
Plaintiff’s final objection concerns the ALJ’s weighing of the other non-treating, medical
opinions of record. The ALJ was presented with opinion testimony from four psychologists
regarding her ability to meet or equal a listing: Drs. Knight and Hamme, who examined Plaintiff;
Dr. Fuess, who reviewed Plaintiff’s medical records and testified at the administrative hearing;
13 and Dr. McGalliard, who provided a post-hearing record review and assessment of Plaintiff’s
impairments.
Dr. Knight examined Plaintiff on December 1, 2008, at the request of the state agency when
it was adjudicating her first disability application. Dr. Knight conducted a clinical interview and
administered the WAIS-III test,5 which indicated that Plaintiff had a full scale IQ of 61, on the
retarded range. (R. 288.) Dr. Knight believed the scores to be valid and reliable and opined that
Plaintiff was a,
[M]entally retarded 29-year-old female with limited educational skills. She has difficulty following directions and has been unable to keep a job. She was able to carry out some short and simple instructions and remember details. She was unable to understand or carry out detailed instructions. The applicant lacks ability to make judgment on simple work-related decisions.
(R. 289.) Dr. Knight recommended a vocational training program on Plaintiff’s level of
competency. (R. 290.)
Dr. Hamme evaluated Plaintiff on February 9, 2012, and also administered the WAIS-III
test. The testing suggested that Plaintiff’s full scale IQ was 66, which put Plaintiff at the mildly
retarded to borderline level of intellectual functioning. (R. 407). Dr. Hamme remarked that the
results suggested a pervasive intellectual deficiency and were consistent with the work difficulties
Plaintiff had experienced. (R. 408.) The doctor also commented that Plaintiff’s approach to the
testing “was cooperative but not especially energetic or interested. Her effort appeared to be
minimal, particularly as the questions increased in difficulty.” (R. 407.)
5 The Wechsler Adult Intelligence Scales test (“WAIS-III”) is “the standard instrument in the United States for assessing intellectual functioning.” Atkins v. Virginia, 536 U.S. 304, 309 n.5 (2002). 14 Dr. Fuess testified at the administrative hearing—after a comprehensive review of
Plaintiff’s school and medical records—and remarked that the 2008 and 2012 test scores were not
consistent with Plaintiff’s history and her educational performance. (R. 457.) He noted that she
received B’s, C’s, and D’s in high school, with learning support services, and that her Wide Range
Achievement Test (“WRAT”) scores administered in school were inconsistent with the mild
mental retardation suggested by Drs. Knight and Hamme. (R. 458.) He further commented that
the IQ tests administered by Drs. Knight and Hamme were highly subjective, in that they depended
significantly on the effort put forth in the testing. (R. 459.) Extrapolating Plaintiff’s IQ from her
WRAT scores, Dr. Fuess opined that Plaintiff’s IQ would be in the low average range. (R. 460.)
Finally, after the December 8, 2015 administrative hearing, Plaintiff’s counsel
supplemented the record with an opinion by David McGalliard, Ph.D., who reviewed the record.
Dr. McGalliard rejected Dr. Fuess’s assessment and opined that it was “specious to claim that an
old level of achievement measured by the WRAT scores invalidates a more recent measure of
intellectual ability as there are a host of factors in the intervening time period that could impact
intellectual ability, for example, head trauma, or impoverished environment.” (R. 809.) He
observed that the supportive special education environment that Plaintiff had in school was missing
for many years at the time of the administration of the 2008 and 2012 WAIS tests. He concluded
that “to say that the WAIS data showing intellectual disability are invalid because of very old
WRAT achievement scores administered when she was in a special education learning support
environment is absurd. Without specialized learning support, her cognitive capabilities have
declined.” (R. 809.)
The ALJ explicitly considered the testimony of all four doctors and opted to give
significant weight to the hearing testimony of Dr. Fuess, noting:
15 The record shows that the claimant received a Full Scale IQ score of 61 when tested on the WAIS-III in December 2008. . . ., and that she later received a Full Scale IQ score that was estimated to be between 63 and 71 when tested in February 2012 . . . . The latter IQ score would place the claimant within the borderline to mildly deficient range of intellectual ability. Although the examining psychologists considered these scores to be a valid indicator of the claimant’s intellectual ability, the validity of these scores was questioned by Dr. Fuess, a licensed psychologist who testified as an impartial medical expert at the December 2015 hearing.
Dr. Fuess testified that claimant’s 2008 and 2012 Full Scale IQ scores were inconsistent with the scores the claimant achieved during a 1996 administration of the Wide Range Achievement Test. He noted that while the claimant achieved a borderline score of 74 on the math achievement test, she earned average scores on both the spelling and reading achievement tests. In his opinion, her combined scores on the achievement tests suggest that the claimant is functioning within the low average range of intellectual ability with an estimated Full Scale IQ somewhere in the 80s range. Dr. Fuess also testified that the more recent IQ scores achieved by the claimant on the 2012 test were also questionable because the examining psychologist had noted that the claimant displayed minimal effort during the testing. Dr. Fuess further testified that based on his review of the record as a whole, the claimant does not display the level of adaptive deficits that one would expect to find in an individual with mild mental retardation.
(R. 435.) The ALJ noted that Dr. Fuess’s opinion was persuasive “in part, because it was based
on consideration of the record evidence as a whole, to include, inter alia, evidence of claimant’s
social functioning, activities of daily living, and the entirety of claimant’s school records.” (R.
435 n.1.)
On review, Judge Strawbridge affirmed the ALJ’s decision to credit Dr. Fuess over the
other medical professionals. He noted that Dr. Knight’s consultative examination was undertaken
on December 1, 2008, some ten months prior to the alleged onset date of October 25, 2009. (R&R
26.) Judge Strawbridge also posited that Dr. Hamme did not complete a statement reflecting her
16 opinion of Plaintiff’s residual functional capacity and that nothing in her evaluation report
appeared to be in conflict with the ALJ’s RFC finding.6 (Id.)
Plaintiff now contends that that the ALJ erred in giving more weight to Dr. Fuess’s opinion
because it stood alone and was inconsistent with the remainder of the record, including the opinions
of Drs. Hamme, Knight, and McGalliard.
While I recognize that reasonable jurists could have weighed the evidence differently, I
concur with Judge Strawbridge that the ALJ’s decision is supported by substantial evidence. A
medical opinion is simply “one piece of evidence to evaluate in formulating the RFC . . . (and) it
is not necessarily controlling.” Pollace v. Astrue, No. 06–5156, 2008 WL 370590, at *5 (E.D. Pa.
Feb. 6, 2008). In evaluating medical reports, the ALJ is free to choose the medical opinion of one
doctor over that of another. Diaz v. Commissioner of Social Sec., 577 F.3d 500, 505 (3d Cir.
2009). “When a conflict in the evidence exists, the ALJ may choose whom to credit but cannot
reject evidence for no reason or for the wrong reason. The ALJ must consider all the evidence and
give some reason for discounting the evidence she rejects.” Plummer v. Apfel, 186 F.3d 422, 429
(3d Cir. 1999) (internal citation omitted).
Here, the ALJ set forth an adequate basis for accepting Dr. Fuess’s opinion and rejecting
those of Drs. Hamme, Knight, and McGalliard. First, the ALJ noted that Dr. Fuess provided a
contemporaneous assessment of Plaintiff’s functioning based on a longitudinal review of
Plaintiff’s school and mental health records through 2015. This review stood in contrast to that of
Dr. Knight, who tested Plaintiff in 2008, prior to the disability onset date, and had no long-term
picture of Plaintiff’s functioning over the next seven years. Similarly, Dr. Hamme evaluated
6 The R&R did not address the ALJ’s rejection of Dr. McGalliard’s report. 17 Plaintiff only one time in 2012, three years before the hearing, and, unlike Dr. Fuess, did not have
the benefit of reviewing Plaintiff’s subsequent psychological records.
Second, the ALJ credited Dr. Fuess’s explanation that the earlier Wide Range Achievement
Test scores conducted while Plaintiff was in school were a more reliable indicator of Plaintiff’s
adaptive functioning than the Full Score IQ scores on which Drs. Knight and Hamme premised
their assessments. The ALJ found that Dr. Fuess credibly testified that Full Scale IQ tests can be
manipulated and results are dependent on the effort put forth by the test subject—an observation
corroborated by Dr. Hamme who remarked that Plaintiff displayed minimal effort in her testing.
Third, the ALJ remarked that, unlike Drs. Knight and Hamme, Dr. Fuess did not rest his
opinion on only clinical testing results, but also on his ability to review whether that testing was
consistent with Plaintiff’s activities of daily living and general functioning. Indeed, as noted by
the ALJ, Dr. Fuess was able to opine that, “based on his review of the record as a whole, Plaintiff
did not display the level of adaptive deficits that one would expect to find in an individual with
mild mental retardation.” (R. 435.)
Finally, the mere fact that Dr. McGalliard’s opinion contradicted that of Dr. Fuess does not
render the ALJ’s decision reversible, as the ALJ explained her basis for discounting Dr.
McGalliard. She observed that Dr. McGalliard’s main criticism was that Dr. Fuess’s opinion was
based solely on the previous WRAT (school achievement) scores. The ALJ found this criticism
faulty and deemed Dr. Fuess’s opinion persuasive precisely “because it was based on consideration
of the record evidence as a whole, to include, inter alia, evidence of claimant’s social functioning,
activities of daily living, and the entirety of claimant’s school records. (R. 435 n.1.) Moreover,
the ALJ’s own independent review of the record suggested that Dr. Fuess’s assessment was “more
consistent with the evidence of record when considered in its entirety.” (R. 436.)
18 Ultimately, the ALJ’s listings analysis and RFC assessment were consistent with and
supported by substantial evidence of record. While reasonable minds may have drawn different
conclusions, it is not within my purview to re-weigh the evidence of record under a de novo
analysis. I concur with Judge Strawbridge that the ALJ’s decision to credit Dr. Fuess above the
other psychologists satisfied the substantial evidence standard of review.
IV. CONCLUSION
For all of the foregoing reasons, I will overrule Plaintiff’s Objections and adopt the Report
and Recommendation in its entirety. An appropriate Order follows.
19 | 2019-01-07 | [
"IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA JESSICA A. SAFRONSKY, : : CIVIL ACTION Plaintiff, : : v. : : NO. 16-4002 NANCY A. BERRYHILL, : Acting Commissioner of Social Security : : Defendant. : Goldberg, J. January 7, 2019 MEMORANDUM Currently before me are Plaintiff Jessica A. Safronsky’s Objections to the Report and Recommendation of United States Magistrate Judge David R. Strawbridge. Upon review of the entire record and the comprehensive Opinion written by Judge Strawbridge, I adopt the Report and Recommendation and affirm the Commissioner’s finding on disability.",
"However, given the difficult and sensitive issues raised by the record and identified by Plaintiff in her Objections, I write in more detail to explain why I am adopting Judge Strawbridge’s Report. I. BACKGROUND In September 2008, Plaintiff first applied for Disability Insurance Benefits and Supplemental Security Income, under Titles II and XVI respectively of the Social Security Act, 42 U.S.C. § 401, et seq. Plaintiff alleged disability due to a learning disorder. Her claim was denied and Plaintiff did not pursue an appeal. She reapplied in January 2010, again alleging disability resulting from a learning disorder and slow motor skills. This claim was also denied. Plaintiff filed a new application on April 19, 2011, asserting a disability onset date of October 25, 2009. The state agency denied her application in August 2011, and Plaintiff requested an administrative hearing. Following the hearing, the ALJ issued a decision, dated November 16, 2012, finding Plaintiff not disabled. Plaintiff appealed to this Court.",
"The Honorable William H. Yohn, Jr. granted the Commissioner’s motion to remand and ordered the ALJ to engage a medical expert to assist in determining whether Plaintiff satisfied two particular criteria of Listing 12.05. On December 8, 2015, the same ALJ held a second administrative hearing where Plaintiff, a vocational expert, and a medical expert testified. The ALJ then issued a new decision on March 30, 2016, finding Plaintiff not disabled because she did not meet or equal any of the Listings of Impairments in the Social Security regulations and was capable of performing jobs that existed in significant numbers in the national economy. Plaintiff filed the present litigation on July 25, 2016, challenging the ALJ’s decision. United States Magistrate Judge David R. Strawbridge issued a Report and Recommendation (“R&R”) finding that the ALJ’s decision was supported by substantial evidence.",
"On June 7, 2018, Plaintiff filed objections to that R&R.1 1 Where a United States Magistrate Judge has issued a report and recommendation in a social security case and a party makes a timely and specific objection to that report and recommendation, the district court is obliged to engage in de novo review of only those issues raised on objection. 28 U.S.C. § 636(b)(1); see also Sample v. Diecks, 885 F.2d 1099, 1106 n.3 (3d Cir. 1989). For those sections of the report and recommendation to which no objection is made, the court should, as a matter of good practice, “satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.” Fed. R. Civ.",
"P. 72(b), advisory committee notes. The court may “accept, reject, or modify, in whole or in part, the findings and recommendations” contained in the report. 28 U.S.C. § 636(b)(1). In the exercise of sound judicial discretion, the court may also rely on the Magistrate Judge’s proposed findings and recommendations. See United v. Raddatz, 447 U.S. 667, 676 (1980). 2 II. STANDARD OF REVIEW As discussed by Judge Strawbridge, judicial review of the Commissioner’s decision is limited to determining whether “substantial evidence” supports the decision. Burnett v. Comm’r of Soc. Sec. Admin., 220 F.3d 112, 118 (3d Cir. 2000). “Substantial evidence ‘does not mean a large or considerable amount of evidence, but rather such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’” Hartranft v. Apfel, 181 F.3d 358, 360 (3d Cir. 1999) (quoting Pierce v. Underwood, 487 U.S. 552, 564–65 (1988)). When making this determination, a reviewing court may not undertake a de novo review of the Commissioner’s decision and may not re-weigh the evidence of record. Monsour Med.",
"Ctr. v. Heckler, 806 F.2d 1185, 1190 (3d Cir. 1986). In other words, even if the reviewing court would have decided the case differently, the Commissioner’s decision must be affirmed if it is supported by substantial evidence. Id. at 1190–91; see also Gilmore v. Barnhart, 356 F. Supp. 2d 509, 511 (E.D. Pa. 2005) (holding that the court’s scope of review is “limited to determining whether the Commissioner applied the correct legal standards and whether the record, as a whole, contains substantial evidence to support the Commissioner’s findings of fact”) (quoting Schwartz v. Halter, 134 F. Supp. 2d 640, 647 (E.D. Pa. 2001)). In an adequately developed factual record, substantial evidence may be “something less than the weight of the evidence, and the possibility of drawing two inconsistent conclusions from the evidence does not prevent [the ALJ’s decision] from being supported by substantial evidence.” Consolo v. Fed. Maritime Comm’n, 383 U.S. 607, 620 (1966).",
"III. PLAINTIFF’S OBJECTIONS Plaintiff raises two general objections to the R&R. First, she contends that Judge Strawbridge erred in affirming the ALJ’s determination that Plaintiff’s intellectual disability did 3 not meet or equal Listing 12.05. Second, she claims that the ALJ erred in review of various examining and non-examining doctors. A. Listings Analysis Plaintiff’s first objection concerns the ALJ’s review at step three of the sequential analysis. At this step, the ALJ must determine whether the claimant’s impairment matches, or is equivalent to one of the listed impairments.",
"Burnett v. Comm’r of Soc. Sec. Admin., 220 F.3d 112, 119 (3d Cir. 2000). The listings describe impairments that prevent an adult, regardless of age, education or work experience, from performing “any gainful activity.” 20 C.F.R. §§ 404.1525(a); 1416.925(a); Knepp v. Apfel, 204 F.3d 78, 85 (3d Cir. 2000). “If the impairment is equivalent to a listed impairment, then [the claimant] is per se disabled and no further analysis is necessary.” Burnett, 220 F.3d at 119. While the burden is on the claimant to present medical findings to show that his or her impairment meets or equals a listing, the ALJ should identify the closest applicable impairment, fully develop the record, and explain whether and why the claimant’s impairments are or are not equivalent in severity to one of the listed impairments. Id. at 120 n.2. At issue in this case is Listing 12.05 of the Social Security regulations, which deals with intellectual disorders. The introductory paragraph of 12.05 explains that such disorders are “characterized by significantly subaverage general intellectual functioning, significant deficits in current adaptive functioning, and manifestation of the disorder before age 22.” Listing 12.05, Mental Retardation, 20 C.F.R.",
"Pt. 404, Subpt. P, App. 1 (effective Mar. 24, 2011 to June 6, 2011). The Listing goes on to state that: The required level of severity for this disorder is met when the requirements in A, B, C, or D are satisfied. A. Mental incapacity evidenced by dependence upon others for personal needs (e.g., toileting, eating, dressing, or bathing) and 4 inability to follow directions, such that the use of standardized measures of intellectual functioning is precluded; Or B.",
"A valid verbal, performance, or full scale IQ of 59 or less; Or C. A valid verbal, performance, or full scale IQ of 60 through 70 and a physical or other mental impairment imposing an additional and significant work-related limitation of function; Or D. A valid verbal, performance, or full scale IQ of 60 through 70, resulting in at least two of the following: 1. Marked restriction of activities of daily living; or 2. Marked difficulties in maintaining social functioning; or 3. Marked difficulties in maintaining concentration, persistence, or pace; or 4. Repeated episodes of decompensation, each of extended duration. Id. “As the disjunctive language of the Listing indicates, the required level of severity for this disorder is met when the requirements of both the introductory paragraph and paragraph A, B, C or D of the Listing are satisfied.” Simon v. Berryhill, No. 16-1533, 2017 WL 4842416, at *2 (W.D. Pa. Oct. 26, 2017).",
"An impairment that meets only some of the criteria, “no matter how severely, does not qualify” for a per se disability determination. Sullivan v. Zebley, 493 U.S. 521, 530 (1990). To satisfy part C—which is the specific subpart at issue here—a plaintiff must have “1) significantly subaverage intellectual functioning with deficits in adaptive behavior initially manifested during developmental period (i.e., before age 22); 2) a valid verbal, performance, or full scale IQ of 60 through 70; and 3) a physical or other mental impairment imposing an additional and significant work-related limitation or function.” Simon, 2017 WL 4842416, at *2 (emphasis 5 in original) (citing 20 C.F.R. pt.",
"404, subpt. P., app. 1 § 12.05C; Williams v. Sullivan, 970 F.2d 1178, 1184 (3d Cir. 1992)); see also Illig v. Comm’r Soc. Sec., 570 F. App’x 262, 265 (3d Cir. 2014). Here, the ALJ reviewed the criteria of Listing 12.05C and concluded that Plaintiff did not meet or equal that Listing. Focusing on the first element of 12.05C in particular, the ALJ remarked that Plaintiff did not show deficits in adaptive behavior. The ALJ based her decision, in part, on the testimony of medical expert Dr. Fuess that, “the claimant does not display the level of adaptive deficits that one would expect to find in an individual with mild mental retardation.” (R. 435.)",
"The ALJ further relied on Plaintiff’s school records, social functioning, and activities of daily living and found: The record shows that the claimant was able to graduate high school with the assistance of learning support services with grades ranging from “B’s” to “D’s”. Her school records show that she has good verbal and good reading comprehension skills. They also show that she has developed good social skills and that she gets along with her peers. Claimant’s mental health treatment records also mention that the claimant enjoys reading and working on crossword puzzles . . . While claimant’s poor work history may suggest occupational deficits in adaptive functioning, it is not known how many jobs were lost because of poor job performance. It is known that some were lost for reasons other than poor performance. In May 2010, the claimant reported that she stopped working because she was being harassed by a coworker.",
". . . In July 2010, the claimant reported that she had to stop working because of dizziness. . . . Some jobs may have been lost because they involved more skilled types of work. The claimant reports having to leave at least one job because she was unable to multitask. . . . Moreover, it is not known how many jobs may have been lost because of poor motivation to work. Claimant’s school records show that she “works steadily when interested” and that she “performs well academically when in school” (suggesting a problem with motivation). ... The undersigned finds that claimant’s mental disorder is only mildly interfering with her activities of daily living. The record shows that 6 the claimant cooks, cleans, and takes care of her daily needs. . .",
". Her mental health treatment records show that she always presents appropriately dressed and groomed for her therapy sessions. (R. 436 (emphasis in original).) On review, Judge Strawbridge concluded that substantial evidence supported the ALJ’s determination that Plaintiff did not have deficits in adaptive functioning during the developmental period. Accordingly, he declined to set aside the ALJ’s step three finding. Plaintiff now argues that this determination was erroneous on several grounds. First, Plaintiff urges that the ALJ improperly equated her ability to perform activities of daily living with her ability to perform full-time competitive work.",
"The determination of whether a claimant has deficits in adaptive behavior requires an ALJ to consult any one of four professional organizations that work with mental retardation for the measurement criteria. See Technical Revisions to Medical Criteria for Determinations of Disability, 67 FR 20018 (April 24, 2002); see also Logan v. Astrue, No. 07-1472, 2008 WL 4279820 at *8 (W.D. Pa. Sept.16, 2008). One of the authorized resources is the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders (5th ed.) (“DSM-V”).2 Jones v. Colvin, No. 14-282, 2015 WL 3646313, at *5 2 Although the ALJ did not explicitly state which definition of “adaptive functioning” she applied, it is abundantly obvious that she used the definition of “intellectual disability” set forth in the DSM-V. The ALJ considered factors such as activities of daily life, communication, social participation, and independent living across multiple environments such as home, school, and work. While the ALJ should have, in the interest of thoroughness, expressly indicated the definition of “adaptive functioning” upon which she relied, Plaintiff’s objections do not challenge that aspect of the ALJ’s decision.",
"Moreover, “[n]o authority exists that states that an ALJ must definitely state which definition was applied.” Jones v. Colvin, No. 14-282, 2015 WL 3646313, at *8 (W.D. Pa. June 10, 2015). Rather, it is sufficient that the ALJ addressed each of the criteria used to evaluate Plaintiff’s deficits. Id. ; compare Harper v. Colvin, No. 13-446, 2014 WL 1278094, at *8 (W.D. Pa. Mar. 27, 2014) (declining to require an ALJ to articulate one specific standard where he “sufficiently explained the benchmark he used to arrive at his conclusion”), 7 (W.D. Pa. June 10, 2015). The DSM-V defines deficits in adaptive functioning as “how well a person meets community standards of personal independence and social responsibility, in comparison to others of similar age and sociocultural background.” DSM-V at 37. Such deficits “limit functioning in one or more activities of daily life, such as communication, social participation, and independent living, across multiple environments, such as home, school, work, and community.” Id.",
"at 33 (emphasis added). The requisite deficits are present when at least one of the three domains of adaptive functioning (conceptual, social, and practical) is sufficiently impaired that ongoing support is needed in order for the person to perform adequately in one or more life settings at school, at work, at home, or in the community. See id. at 38. Under the DSM-V’s definition, the ALJ was required to consider Plaintiff’s activities of daily living. The ALJ detailed her reasoning as to each category of activities and, therefore, satisfied the substantial evidence standard.3 Accordingly, I do not agree with this portion of Plaintiff’s objections.",
"with Gruden v. Astrue, No. 10-569, 2011 WL 4565502, at *5 (W.D. Pa. Sept. 29, 2011) (remanding “so the ALJ can explain what measurement method he used to determine whether plaintiff has established that she has deficits in adaptive functioning.”). 3 See, e.g., Mastarone v. Berryhill, No. 16-1421, 2018 WL 783678, at *4 (W.D. Pa. Feb. 8, 2018) (affirming ALJ’s conclusion of no deficits in adaptive functioning where record showed that claimant (a) could read English with fair vocabulary and count change, even though he dropped out of school in 8th grade, (b) maintained “skilled work as a mechanic” for five years, (c) demonstrated empathy, interpersonal communication, and social skills by virtue of his relationships with his girlfriend and family; and (c) was “able to perform a full range of activities of daily living including caring for his personal needs, preparing simple meals, shopping by phone, watching television, and utilizing public transportation.”); Harper v. Colvin, No.",
"13-446, 2014 WL 1278094 at * 8 (W.D. Pa. March 27, 2014) (affirming the ALJ’s conclusion that the claimant did not have deficits in adaptive functioning where the claimant completed high school, worked in jobs requiring some skill prior to the alleged onset date, managed her own finances, drove, cared for herself, shopped for groceries, and raised two sons); Gibbs v. Comm’r. of Soc. Sec., 686 F. App’x 799, 802 (11th Cir. 2017) (holding that substantial evidence supported the ALJ’s finding that the claimant did not have deficits in adaptive functioning where she lived alone at times and, with her mother’s help, cared for her daughter, did her own laundry, cleaned her home, cooked 8 Second, Plaintiff argues that her inability to sustain employment—having held over sixty jobs between 1995 and 2009—is one of “many concrete manifestations” of her adaptive functioning deficits. (Pl.’s Objections 3.) The ALJ properly concluded that this “scattershot work history” did not conclusively establish a deficit in adaptive functioning. As detailed above, the ALJ remarked that the record contained no evidence that Plaintiff’s inability to sustain a job resulted from deficits in her functioning abilities; rather she found evidence suggesting that other factors, including Plaintiff’s lack of desire to work, were often responsible for her inability to maintain employment. Finally, Plaintiff asserts that her IQ testing from December 2008 and February 2012, which showed a “mildly retarded range of intellectual functioning,” reflected her adaptive functioning deficits before age 22.",
"Courts, however, have rejected the notion that low IQ scores used to satisfy either 12.05B or 12.05C are in and of themselves sufficient to satisfy the Listing 12.05’s separate requirement of “the existence of deficits in adaptive functioning prior to attaining age 22.” See Gist v. Barnhart, 67 F. App’x 78, 81 (3d Cir. 2003) (“As is true in regard to any 12.05 listing, before demonstrating the specific requirements of Listing 12.05C, a claimant must show proof of a ‘deficit in adaptive functioning’ with an initial onset prior to age 22.”); Lansdowne v. Astrue, No.",
"11-487, 2012 WL 4069363 (W.D. Pa. Sept. 17, 2012) (“[P]ursuant to the Regulations and case law, in order to meet Listing 12.05, a claimant must meet both the introductory-criteria to that listing requiring ‘significantly subaverage general intellectual functioning with deficits in adaptive functioning initially manifested [before age 22]’ and the criteria of one of paragraphs A through D.”) “A valid IQ score need not be treated as conclusive of intellectual disability where the IQ simple meals, had her driver’s license, handled her own money, was able to shop, and received several passing grades in special education classes in 9th and 10th grades). 9 score is inconsistent with other evidence in the record on the claimant's daily activities and behavior.” Jones v. Soc. Sec. Admin., Comm’r, 695 F. App’x 507, 509 (11th Cir. 2017).",
"“In other words, evidence of a claimant’s daily activities and behavior may show that the claimant has a greater degree of adaptive functioning than suggested by his IQ scores.” Id. Ultimately, Plaintiff bears the burden of proof to show that she meets or equals the listings at step three. Gist, 67 F. App’x at 81. Aside from referencing her work history, which— as noted above—is not sufficient, Plaintiff has not provided evidence establishing that before the age of 22 she had a deficit in adaptive functioning. As such, I find the ALJ’s listing determination to be well supported by substantial evidence. Accordingly, I decline to remand the ALJ’s Step Three finding. B. ALJ’s Evaluation of Medical Professional Opinions Plaintiff’s second objection to the R&R challenges Judge Strawbridge’s adoption of the ALJ’s findings with respect to the various medical opinion evidence. Specifically, Plaintiff argues that: (1) the ALJ failed to follow regulatory guidance requiring that deference be accorded to the opinion by Plaintiff’s treating physician, Dr. Wright; and (2) the ALJ’s weighing of the various non-treating medical opinions was in error. 1. Dr. Wright Dr. Wright was Plaintiff’s treating psychologist. On August 11, 2011, Dr. Wright completed a Mental Impairment Questionnaire and assessed Plaintiff as having limited mental abilities in several areas of functioning needed for unskilled work, such as understanding and carrying out short and simple instructions and maintaining regular attendance.",
"Dr. Wright further remarked that Plaintiff (a) lacked an ability to compete in areas such as making simple work decisions, and working in coordination with and proximity to others, and (b) had no “useful” ability to sustain an ordinary routine without special supervision, complete a normal workday or 10 workweek without interruption from her psychological symptoms, or perform at a consistent pace. (R. 424.) Dr. Wright determined that Plaintiff had only a mild restriction on activities of daily living, and limited episodes of decompensation, but moderate to marked limitations in social functioning, and marked to extreme limitations on concentration, persistence and pace. (R.",
"426. )4 The ALJ addressed Dr. Wright’s opinion as follows: The undersigned finds that claimant’s mental disorder is no more than moderately interfering with her ability to maintain concentration, persistence or pace. When evaluated by Dr. Bonnie Wright in August 2012, the claimant was considered to have limited but satisfactory ability to understand, remember and carry out very short and simple instructions. . . . When seen in therapy on November 18, 2014, the claimant was described as cooperative and attentive. When more recently seen on May 5, 2015, the claimant was described as alert, well-focused and cooperative. ... The undersigned is also crediting Dr. Bonnie Wright’s opinion that the claimant has limited but satisfactory ability to: understand, remember and carry out very short and simple instructions; to maintain regular job attendance; to interact appropriately with the general public; and to maintain social appropriate behavior. . .",
". The undersigned is giving little weight to the more restrictive limitations noted by Dr. Wright because they are based in large part upon a finding of mild mental retardation that is not well-supported in the record. (R. 437.) Judge Strawbridge found this assessment of Dr. Wright’s opinion to be supported by substantial evidence. Plaintiff’s current objections reiterate her challenges to the ALJ’s weighing of Dr. Wright’s testimony and allege that neither the ALJ nor Judge Strawbridge properly evaluated Dr. Wright’s opinion under the regulatory factors. I disagree with Plaintiff for several reasons. Primarily, as noted by Judge Strawbridge, it is well established that although “treating physicians’ opinions are assumed to be more valuable 4 Dr. Wright’s report is more thoroughly described in the R&R. 11 than those of non-treating physicians,” this “assumption does not turn on impermissibly mechanical deference to the treating physician’s opinion.” Cyprus Cumberland Res.",
"v. Dir., Office of Workers’ Compensation Programs, 170 F. App’x 787, 792 (3d Cir. 2006) (quotations omitted). An ALJ’s decision to reject the opinion of a treating physician is proper where the physician’s own treatment records do not support his/her opinion and the record contains medical evidence contrary to his/her opinion. See Grogan v. Comm’r of Soc. Sec., 459 F. App’x 132, 137 (3d Cir. 2012); see also Matney v. Sullivan, 981 F.2d 1016, 1019 (9th Cir. 1992) (“The ALJ need not accept an opinion of a physician—even a treating physician—if it is conclusory and brief and is unsupported by clinical findings.”). Here, as noted in the R&R, substantial evidence undermined the notion that Plaintiff was as limited as Dr. Wright suggested: psychotherapy notes contemporaneous to the medication management that Dr. Wright oversaw were benign; Plaintiff was discharged from psychotherapy because she had achieved all of her therapy goals; there was no record of mental health treatment after Dr. Wright offered her opinion until, due to developments in her disability claim, Plaintiff sought out treatment with a new provider in March 2014; and contrary to Dr. Wright’s opinion, Plaintiff’s activities of daily living showed that she was not as limited as described.",
"(R&R 22.) Further, Dr. Wright’s opinion was encompassed entirely in a checkbox report with no written explanation for the limitations she imposed. As the Third Circuit has observed, “[f]orm reports in which a physician’s obligation is only to check a box or fill in a blank”—as is the case here—“are weak evidence at best.” Mason v. Shalala, 994 F.2d 1058, 1065 (3d Cir. 1993). This is particularly true when those residual capacity reports are “unaccompanied by thorough written reports.” Brewster v. Heckler, 786 F.2d 581, 585 (3d Cir. 1986); see also Santiago v. Astrue, No. 11–3650, 2012 WL 1080181, at *9 (E.D.",
"Pa. Mar. 28, 2012) (“[I]n light of the relatively cursory 12 and checklist format of [the treating physician’s] opinion, the sparsity of the support for her conclusions in her own records, and the contradictory nature of the medical evidence from [the plaintiff's] treating therapist, the Court holds that the ALJ was not required to attribute more than ‘little to no weight’ to [the treating physician's] opinion of [the plaintiff’s] mental limitations.”). Finally, it is notable that the ALJ did not completely reject Dr. Wright’s opinion, but rather found that it was entitled to limited weight to the extent it was supported by other evidence of record. Indeed, the ALJ incorporated many of Dr. Wright’s opinions into the residual functional capacity assessment and found that Plaintiff was capable of performing simple, routine job tasks with few changes in the work routine, and that the work should be self-paced, not involve detailed instructions, not require more than occasional interaction with coworkers or the general public, and not involve occupational hazards. (R. 437.) Under controlling jurisprudence, the ALJ was not required to blindly accept Dr. Wright’s opinion without consideration of the entire record. As I agree with Judge Strawbridge that the ALJ’s decision to reject a portion of Dr. Wright’s assessment was supported by substantial evidence, I will overrule Plaintiff’s objection on this issue.",
"2. Drs. Knight, Hamme, Fuess, and McGalliard Plaintiff’s final objection concerns the ALJ’s weighing of the other non-treating, medical opinions of record. The ALJ was presented with opinion testimony from four psychologists regarding her ability to meet or equal a listing: Drs. Knight and Hamme, who examined Plaintiff; Dr. Fuess, who reviewed Plaintiff’s medical records and testified at the administrative hearing; 13 and Dr. McGalliard, who provided a post-hearing record review and assessment of Plaintiff’s impairments. Dr. Knight examined Plaintiff on December 1, 2008, at the request of the state agency when it was adjudicating her first disability application. Dr. Knight conducted a clinical interview and administered the WAIS-III test,5 which indicated that Plaintiff had a full scale IQ of 61, on the retarded range. (R. 288.) Dr. Knight believed the scores to be valid and reliable and opined that Plaintiff was a, [M]entally retarded 29-year-old female with limited educational skills. She has difficulty following directions and has been unable to keep a job.",
"She was able to carry out some short and simple instructions and remember details. She was unable to understand or carry out detailed instructions. The applicant lacks ability to make judgment on simple work-related decisions. (R. 289.) Dr. Knight recommended a vocational training program on Plaintiff’s level of competency. (R. 290.) Dr. Hamme evaluated Plaintiff on February 9, 2012, and also administered the WAIS-III test. The testing suggested that Plaintiff’s full scale IQ was 66, which put Plaintiff at the mildly retarded to borderline level of intellectual functioning. (R. 407). Dr. Hamme remarked that the results suggested a pervasive intellectual deficiency and were consistent with the work difficulties Plaintiff had experienced. (R. 408.) The doctor also commented that Plaintiff’s approach to the testing “was cooperative but not especially energetic or interested. Her effort appeared to be minimal, particularly as the questions increased in difficulty.” (R. 407.) 5 The Wechsler Adult Intelligence Scales test (“WAIS-III”) is “the standard instrument in the United States for assessing intellectual functioning.” Atkins v. Virginia, 536 U.S. 304, 309 n.5 (2002). 14 Dr. Fuess testified at the administrative hearing—after a comprehensive review of Plaintiff’s school and medical records—and remarked that the 2008 and 2012 test scores were not consistent with Plaintiff’s history and her educational performance.",
"(R. 457.) He noted that she received B’s, C’s, and D’s in high school, with learning support services, and that her Wide Range Achievement Test (“WRAT”) scores administered in school were inconsistent with the mild mental retardation suggested by Drs. Knight and Hamme. (R. 458.) He further commented that the IQ tests administered by Drs. Knight and Hamme were highly subjective, in that they depended significantly on the effort put forth in the testing. (R. 459.) Extrapolating Plaintiff’s IQ from her WRAT scores, Dr. Fuess opined that Plaintiff’s IQ would be in the low average range. (R. 460.)",
"Finally, after the December 8, 2015 administrative hearing, Plaintiff’s counsel supplemented the record with an opinion by David McGalliard, Ph.D., who reviewed the record. Dr. McGalliard rejected Dr. Fuess’s assessment and opined that it was “specious to claim that an old level of achievement measured by the WRAT scores invalidates a more recent measure of intellectual ability as there are a host of factors in the intervening time period that could impact intellectual ability, for example, head trauma, or impoverished environment.” (R. 809.) He observed that the supportive special education environment that Plaintiff had in school was missing for many years at the time of the administration of the 2008 and 2012 WAIS tests.",
"He concluded that “to say that the WAIS data showing intellectual disability are invalid because of very old WRAT achievement scores administered when she was in a special education learning support environment is absurd. Without specialized learning support, her cognitive capabilities have declined.” (R. 809.) The ALJ explicitly considered the testimony of all four doctors and opted to give significant weight to the hearing testimony of Dr. Fuess, noting: 15 The record shows that the claimant received a Full Scale IQ score of 61 when tested on the WAIS-III in December 2008. . .",
"., and that she later received a Full Scale IQ score that was estimated to be between 63 and 71 when tested in February 2012 . . . . The latter IQ score would place the claimant within the borderline to mildly deficient range of intellectual ability. Although the examining psychologists considered these scores to be a valid indicator of the claimant’s intellectual ability, the validity of these scores was questioned by Dr. Fuess, a licensed psychologist who testified as an impartial medical expert at the December 2015 hearing. Dr. Fuess testified that claimant’s 2008 and 2012 Full Scale IQ scores were inconsistent with the scores the claimant achieved during a 1996 administration of the Wide Range Achievement Test. He noted that while the claimant achieved a borderline score of 74 on the math achievement test, she earned average scores on both the spelling and reading achievement tests. In his opinion, her combined scores on the achievement tests suggest that the claimant is functioning within the low average range of intellectual ability with an estimated Full Scale IQ somewhere in the 80s range. Dr. Fuess also testified that the more recent IQ scores achieved by the claimant on the 2012 test were also questionable because the examining psychologist had noted that the claimant displayed minimal effort during the testing.",
"Dr. Fuess further testified that based on his review of the record as a whole, the claimant does not display the level of adaptive deficits that one would expect to find in an individual with mild mental retardation. (R. 435.) The ALJ noted that Dr. Fuess’s opinion was persuasive “in part, because it was based on consideration of the record evidence as a whole, to include, inter alia, evidence of claimant’s social functioning, activities of daily living, and the entirety of claimant’s school records.” (R. 435 n.1.) On review, Judge Strawbridge affirmed the ALJ’s decision to credit Dr. Fuess over the other medical professionals. He noted that Dr. Knight’s consultative examination was undertaken on December 1, 2008, some ten months prior to the alleged onset date of October 25, 2009. (R&R 26.) Judge Strawbridge also posited that Dr. Hamme did not complete a statement reflecting her 16 opinion of Plaintiff’s residual functional capacity and that nothing in her evaluation report appeared to be in conflict with the ALJ’s RFC finding.6 (Id.) Plaintiff now contends that that the ALJ erred in giving more weight to Dr. Fuess’s opinion because it stood alone and was inconsistent with the remainder of the record, including the opinions of Drs.",
"Hamme, Knight, and McGalliard. While I recognize that reasonable jurists could have weighed the evidence differently, I concur with Judge Strawbridge that the ALJ’s decision is supported by substantial evidence. A medical opinion is simply “one piece of evidence to evaluate in formulating the RFC . . . (and) it is not necessarily controlling.” Pollace v. Astrue, No. 06–5156, 2008 WL 370590, at *5 (E.D. Pa. Feb. 6, 2008). In evaluating medical reports, the ALJ is free to choose the medical opinion of one doctor over that of another. Diaz v. Commissioner of Social Sec., 577 F.3d 500, 505 (3d Cir. 2009).",
"“When a conflict in the evidence exists, the ALJ may choose whom to credit but cannot reject evidence for no reason or for the wrong reason. The ALJ must consider all the evidence and give some reason for discounting the evidence she rejects.” Plummer v. Apfel, 186 F.3d 422, 429 (3d Cir. 1999) (internal citation omitted). Here, the ALJ set forth an adequate basis for accepting Dr. Fuess’s opinion and rejecting those of Drs. Hamme, Knight, and McGalliard. First, the ALJ noted that Dr. Fuess provided a contemporaneous assessment of Plaintiff’s functioning based on a longitudinal review of Plaintiff’s school and mental health records through 2015. This review stood in contrast to that of Dr. Knight, who tested Plaintiff in 2008, prior to the disability onset date, and had no long-term picture of Plaintiff’s functioning over the next seven years. Similarly, Dr. Hamme evaluated 6 The R&R did not address the ALJ’s rejection of Dr. McGalliard’s report. 17 Plaintiff only one time in 2012, three years before the hearing, and, unlike Dr. Fuess, did not have the benefit of reviewing Plaintiff’s subsequent psychological records.",
"Second, the ALJ credited Dr. Fuess’s explanation that the earlier Wide Range Achievement Test scores conducted while Plaintiff was in school were a more reliable indicator of Plaintiff’s adaptive functioning than the Full Score IQ scores on which Drs. Knight and Hamme premised their assessments. The ALJ found that Dr. Fuess credibly testified that Full Scale IQ tests can be manipulated and results are dependent on the effort put forth by the test subject—an observation corroborated by Dr. Hamme who remarked that Plaintiff displayed minimal effort in her testing. Third, the ALJ remarked that, unlike Drs. Knight and Hamme, Dr. Fuess did not rest his opinion on only clinical testing results, but also on his ability to review whether that testing was consistent with Plaintiff’s activities of daily living and general functioning. Indeed, as noted by the ALJ, Dr. Fuess was able to opine that, “based on his review of the record as a whole, Plaintiff did not display the level of adaptive deficits that one would expect to find in an individual with mild mental retardation.” (R. 435.)",
"Finally, the mere fact that Dr. McGalliard’s opinion contradicted that of Dr. Fuess does not render the ALJ’s decision reversible, as the ALJ explained her basis for discounting Dr. McGalliard. She observed that Dr. McGalliard’s main criticism was that Dr. Fuess’s opinion was based solely on the previous WRAT (school achievement) scores. The ALJ found this criticism faulty and deemed Dr. Fuess’s opinion persuasive precisely “because it was based on consideration of the record evidence as a whole, to include, inter alia, evidence of claimant’s social functioning, activities of daily living, and the entirety of claimant’s school records.",
"(R. 435 n.1.) Moreover, the ALJ’s own independent review of the record suggested that Dr. Fuess’s assessment was “more consistent with the evidence of record when considered in its entirety.” (R. 436.) 18 Ultimately, the ALJ’s listings analysis and RFC assessment were consistent with and supported by substantial evidence of record. While reasonable minds may have drawn different conclusions, it is not within my purview to re-weigh the evidence of record under a de novo analysis. I concur with Judge Strawbridge that the ALJ’s decision to credit Dr. Fuess above the other psychologists satisfied the substantial evidence standard of review. IV. CONCLUSION For all of the foregoing reasons, I will overrule Plaintiff’s Objections and adopt the Report and Recommendation in its entirety.",
"An appropriate Order follows. 19"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/56374525/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Buchanan, J., delivered the opinion of the court. The only question to be determined on this writ of error is whether a deed made to a purchaser at a delinquent land *348tax sale before he has given the notice required by section 655 of Va. Code, 1904, is void, or whether the failure to give such notice is an irregularity which is cured by section 661 of the same Code. Section 655 provides, that after two years have expired from the date of a tax sale such purchaser may obtain a 'deed from the proper clerk, but declares that “in no case shall a deed be made to any such purchaser of any such real estate until after such purchaser has given” to the person or persons therein mentioned who are supposed to be interested in the land as owner or lienors and entitled to redeem the same, “four months’ notice of his said purchase . . . and the person entitled to redeem said real estate shall have the right to redeem the same at any time before the expiration of the said four months, although such time extend beyond the two years first mentioned herein.” Section 661 provides that where the purchaser of any real estate so sold, or sold in pursuance of section 666, has obtained a deed therefor, and the same has been duly admitted to record in the proper clerk’s office, the right or tifie to such estate shall stand vested in the grantee in such deed as was vested in the party assessed with the taxes or levies on account of which the sale was made, etc., etc., subject to be defeated only by proof (1) that the taxes, etc., for which it was sold were not properly chargeable thereon; (2) that the taxes, etc., properly chargeable on such real estate had been paid; (3) that the notice of the tax sale, where made to a person other than the Commonwealth, or notice of the application to purchase, in case the sale was made under sec. 666, had not been duly given; or (4) that the payment or redemption of. said real estate was prevented by fraud or concealment on the part of the purchaser. That section further provides that no suit shall be brought to set aside, cancel or annul such deed except for fraud, as therein provided, unless within two years after the same is properly admitted to record. *349In order for a purchaser at a tax sale to be entitled to the benefit of the provisions of section 661, he must have obtained his deed in accordance with the provisions of section 655 — that is, his deed must be executed by the proper clerk (unless the clerk himself be the purchaser) after the expiration of two years from the date of the tax sale, and after the purchaser has given the notice required by that section. The authority conferred upon the clerk to execute the deed is a mere naked power not coupled with an interest and must be strictly complied with. No rule of law is more firmly settled than that in the case of a naked power, every prerequisite to its exercise must precede it. Sulphur Mines Co. v. Thompson, 93 Va. 293, 316, 25 S. E. 232, and authorities cited; Reusens v. Lawson, 91 Va. 226, 236, 21 S. E. 347; Flanagan v. Grimmet, 10 Gratt. 421, 435, and cases cited. In the absence of a curative statute, if the deed be executed by a person other than the official designated by law to make the deed, it is, of course, a nullity. If authorities be needed for so plain a proposition, they can be found in Judge Allen’s opinion in Flanagan v. Grimmet, supra. If the official be authorized to make the deed after a time named, and he execute it before that time elapses, the deed is also a nullity. Bowe v. City of Richmond, 109 Va. 254, 260, 64 S. E. 51; Bradley, Tr., v. Patterson, ante, p. 33, 70 S. E. 540, decided at the March term, 1911, of court; Minor on Tax Titles, p. Ill, and cases cited. And, a fortiori, the deed must be a nullity when the purchaser not only obtains it without complying with the conditions which entitle him to a deed — i. e., giving the notice required, and when executed by an official in plain violation of the statute which prohibits him from making the deed until four months after the required notice has been given. It may be true, as argued, that the legislature has the power to authorize a conveyance to be made to a purchaser *350at a tax sale without requiring some such notice as that provided for by section 655; but it has not done so. On the contrary, the legislature has declared that the purchaser shall give notice of his purchase, and that he is not entitled to a deed until he has done so. There is nothing, as it seems to us, in section 661 which validates a deed executed to a purchaser at a tax sale in' violation of section 655. The deed must be made by the clerk. It cannot be made until after two years expires from day of sale nor until four months after the notice required by that section has been given. The purchaser at a tax sale must comply with the provisions of section 655 before he is entitled to a deed which will give him the benefit of the curative provisions of section 661. See Va. Coal Co. v. Thomas, 97 Va. at p. 537, 34 S. E. 486; Va. Building, &c., Co. v. Glenn, 99 Va. 460, 39 S. E. 136; Bowe v. City of Richmond, supra; Bradley, Tr., v. Patterson, supra. The provision in section 655 requiring the purchaser to give notice of his purchase as therein provided, was not in that section when section 661 was enacted as it now stands (March 7, 1900, Acts 1889-1900, pp. 1234-5), but was afterwards enacted by amending section 655 of the Code of 1887 by an act approved April 2, 1902 (Acts 1901-2, p. 779). Section 661, as found in Va. Code, 1904 (not as it was when the deed under consideration in the case of Va. Building, &c., Co. v. Glenn, supra, 99 Va. 460, 462, 39 S. E. 136, was executed) does provide that the deed of a purchaser at a tax sale, or under the provisions of section 666 of the Code may be set aside, annulled or cancelled by a suit brought for that purpose within two years from the recordation of the deed, upon the ground among others that “the notice of the tax sale where made to a person other than the Commonwealth, or notice of the application to purchase in case the sale was made under section 666, has not been duly given.” *351Whatever may be the effect of that provision in section 661, as amended, upon the rights of a purchaser under section 666 where the notice required by that section has not been given (Va. Building, &c., Co. v. Glenn, supra), it has no reference to the failure to give the notice required by section 655, because at the time that provision was inserted in section 661 the purchaser at a tax sale was 'not required to give notice of •his purchase before obtaining his deed as he now is under section 655 (Code, 1887, and Acts 1901-2, p. 779), and because the language of the provision in section 661 shows that it refers to the “notice of the tax sale” when bid off by such purchaser, and not to the “notice of his said purchase,” as provided for in section 655, as amended. There are several reasons of public policy why a tax deed obtained by a purchaser who has complied with all the requirements of section 655 should cure irregularities in the proceedings which led up to the sale, and for which such purchaser is in no wise responsible, but there is no reason in a sound public policy or in good morals, why a purchaser at a tax sale who has failed in or refused to comply with the conditions upon which he is entitled to a deed and has obtained it in express violation of law, should be permitted to take advantage of his own negligence or wrong and have the same curative effect given the deed as if it had been obtained in accordance with law. The court is of opinion that, the deed in question having been executed not only without authority, but in plain violation of the positive prohibition of section 655 of the Code, under which it -was obtained, is a nullity, and that the trial court erred in not so holding. Since the plaintiff’s right to recover depended upon the validity of that deed, it follows that the judgment of the trial court, to whom all matters of law and fact were submitted, must be reversed; and this court will enter such judgment as that court ought to have entered.
Reversed. | 07-23-2022 | [
"Buchanan, J., delivered the opinion of the court. The only question to be determined on this writ of error is whether a deed made to a purchaser at a delinquent land *348tax sale before he has given the notice required by section 655 of Va. Code, 1904, is void, or whether the failure to give such notice is an irregularity which is cured by section 661 of the same Code. Section 655 provides, that after two years have expired from the date of a tax sale such purchaser may obtain a 'deed from the proper clerk, but declares that “in no case shall a deed be made to any such purchaser of any such real estate until after such purchaser has given” to the person or persons therein mentioned who are supposed to be interested in the land as owner or lienors and entitled to redeem the same, “four months’ notice of his said purchase . . . and the person entitled to redeem said real estate shall have the right to redeem the same at any time before the expiration of the said four months, although such time extend beyond the two years first mentioned herein.” Section 661 provides that where the purchaser of any real estate so sold, or sold in pursuance of section 666, has obtained a deed therefor, and the same has been duly admitted to record in the proper clerk’s office, the right or tifie to such estate shall stand vested in the grantee in such deed as was vested in the party assessed with the taxes or levies on account of which the sale was made, etc., etc., subject to be defeated only by proof (1) that the taxes, etc., for which it was sold were not properly chargeable thereon; (2) that the taxes, etc., properly chargeable on such real estate had been paid; (3) that the notice of the tax sale, where made to a person other than the Commonwealth, or notice of the application to purchase, in case the sale was made under sec.",
"666, had not been duly given; or (4) that the payment or redemption of. said real estate was prevented by fraud or concealment on the part of the purchaser. That section further provides that no suit shall be brought to set aside, cancel or annul such deed except for fraud, as therein provided, unless within two years after the same is properly admitted to record. *349In order for a purchaser at a tax sale to be entitled to the benefit of the provisions of section 661, he must have obtained his deed in accordance with the provisions of section 655 — that is, his deed must be executed by the proper clerk (unless the clerk himself be the purchaser) after the expiration of two years from the date of the tax sale, and after the purchaser has given the notice required by that section. The authority conferred upon the clerk to execute the deed is a mere naked power not coupled with an interest and must be strictly complied with.",
"No rule of law is more firmly settled than that in the case of a naked power, every prerequisite to its exercise must precede it. Sulphur Mines Co. v. Thompson, 93 Va. 293, 316, 25 S. E. 232, and authorities cited; Reusens v. Lawson, 91 Va. 226, 236, 21 S. E. 347; Flanagan v. Grimmet, 10 Gratt. 421, 435, and cases cited. In the absence of a curative statute, if the deed be executed by a person other than the official designated by law to make the deed, it is, of course, a nullity. If authorities be needed for so plain a proposition, they can be found in Judge Allen’s opinion in Flanagan v. Grimmet, supra. If the official be authorized to make the deed after a time named, and he execute it before that time elapses, the deed is also a nullity. Bowe v. City of Richmond, 109 Va. 254, 260, 64 S. E. 51; Bradley, Tr., v. Patterson, ante, p. 33, 70 S. E. 540, decided at the March term, 1911, of court; Minor on Tax Titles, p. Ill, and cases cited.",
"And, a fortiori, the deed must be a nullity when the purchaser not only obtains it without complying with the conditions which entitle him to a deed — i. e., giving the notice required, and when executed by an official in plain violation of the statute which prohibits him from making the deed until four months after the required notice has been given. It may be true, as argued, that the legislature has the power to authorize a conveyance to be made to a purchaser *350at a tax sale without requiring some such notice as that provided for by section 655; but it has not done so. On the contrary, the legislature has declared that the purchaser shall give notice of his purchase, and that he is not entitled to a deed until he has done so. There is nothing, as it seems to us, in section 661 which validates a deed executed to a purchaser at a tax sale in' violation of section 655.",
"The deed must be made by the clerk. It cannot be made until after two years expires from day of sale nor until four months after the notice required by that section has been given. The purchaser at a tax sale must comply with the provisions of section 655 before he is entitled to a deed which will give him the benefit of the curative provisions of section 661. See Va. Coal Co. v. Thomas, 97 Va. at p. 537, 34 S. E. 486; Va. Building, &c., Co. v. Glenn, 99 Va. 460, 39 S. E. 136; Bowe v. City of Richmond, supra; Bradley, Tr., v. Patterson, supra. The provision in section 655 requiring the purchaser to give notice of his purchase as therein provided, was not in that section when section 661 was enacted as it now stands (March 7, 1900, Acts 1889-1900, pp. 1234-5), but was afterwards enacted by amending section 655 of the Code of 1887 by an act approved April 2, 1902 (Acts 1901-2, p. 779).",
"Section 661, as found in Va. Code, 1904 (not as it was when the deed under consideration in the case of Va. Building, &c., Co. v. Glenn, supra, 99 Va. 460, 462, 39 S. E. 136, was executed) does provide that the deed of a purchaser at a tax sale, or under the provisions of section 666 of the Code may be set aside, annulled or cancelled by a suit brought for that purpose within two years from the recordation of the deed, upon the ground among others that “the notice of the tax sale where made to a person other than the Commonwealth, or notice of the application to purchase in case the sale was made under section 666, has not been duly given.” *351Whatever may be the effect of that provision in section 661, as amended, upon the rights of a purchaser under section 666 where the notice required by that section has not been given (Va. Building, &c., Co. v. Glenn, supra), it has no reference to the failure to give the notice required by section 655, because at the time that provision was inserted in section 661 the purchaser at a tax sale was 'not required to give notice of •his purchase before obtaining his deed as he now is under section 655 (Code, 1887, and Acts 1901-2, p. 779), and because the language of the provision in section 661 shows that it refers to the “notice of the tax sale” when bid off by such purchaser, and not to the “notice of his said purchase,” as provided for in section 655, as amended. There are several reasons of public policy why a tax deed obtained by a purchaser who has complied with all the requirements of section 655 should cure irregularities in the proceedings which led up to the sale, and for which such purchaser is in no wise responsible, but there is no reason in a sound public policy or in good morals, why a purchaser at a tax sale who has failed in or refused to comply with the conditions upon which he is entitled to a deed and has obtained it in express violation of law, should be permitted to take advantage of his own negligence or wrong and have the same curative effect given the deed as if it had been obtained in accordance with law.",
"The court is of opinion that, the deed in question having been executed not only without authority, but in plain violation of the positive prohibition of section 655 of the Code, under which it -was obtained, is a nullity, and that the trial court erred in not so holding. Since the plaintiff’s right to recover depended upon the validity of that deed, it follows that the judgment of the trial court, to whom all matters of law and fact were submitted, must be reversed; and this court will enter such judgment as that court ought to have entered.",
"Reversed."
] | https://www.courtlistener.com/api/rest/v3/opinions/6812403/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Citation Nr: 0712466
Decision Date: 04/27/07 Archive Date: 05/08/07
DOCKET NO. 04-27 986 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office in Baltimore,
Maryland
THE ISSUE
Entitlement to an initial rating for service-connected
membranous nephritis in excess of zero percent as of April 1,
2002, and 30 percent as of October 11, 2006.
REPRESENTATION
Appellant represented by: Disabled American Veterans
WITNESS AT HEARING ON APPEAL
Appellant
ATTORNEY FOR THE BOARD
S. M. Kreitlow, Associate Counsel
INTRODUCTION
The veteran had active military service from May 1981 to
March 2002.
This matter comes before the Board of Veterans' Appeals
(Board) on appeal from a January 2003 rating decision of the
Department of Veterans Affairs (VA) Regional Office (RO) in
Baltimore, Maryland.
FINDINGS OF FACT
1. Service connection for membranous nephritis was granted
effective April 1, 2002.
2. The medical evidence shows that the veteran has constant
albumin in his urine with red blood cells in excess of the
normal range. In addition, the medical evidence shows that
the veteran is now treated for hypertension that is related
to his service-connected membranous nephritis.
3. The veteran's membranous nephritis is not productive of
constant albuminuria with some edema; or definite decreasing
kidney function; or hypertension at least 40 percent
disabling under diagnostic code 7101.
CONCLUSIONS OF LAW
1. The criteria for an initial disability rating of 30
percent effective April 1, 2002 and thereafter for membranous
nephritis, with albumin constant with red blood cells and
hypertension, are met. 38 U.S.C.A. §§ 1155, 5103, 5103A and
5107 (West 2002 & Supp. 2005); 38 C.F.R. §§ 3.102,
3.159, 4.1, 4.2, 4.3, 4.7 and 4.115b, Diagnostic Code 7502
(2006).
2. The criteria for a disability rating in excess of 30
percent for membranous nephritis are not met. 38 U.S.C.A.
§§ 1155, 5103, 5103A and 5107 (West 2002 & Supp. 2005);
38 C.F.R. §§ 3.102, 3.159, 4.1, 4.2, 4.3, 4.7 and 4.115b,
Diagnostic Code 7502 (2006).
REASONS AND BASES FOR FINDINGS AND CONCLUSIONS
I. Analysis
Disability ratings are intended to compensate impairment in
earning capacity due to a service-connected disorder.
38 U.S.C.A. § 1155 (West 2002). Separate diagnostic codes
identify the various disabilities. Id. Evaluation of a
service-connected disorder requires a review of the veteran's
entire medical history regarding that disorder. 38 C.F.R.
§§ 4.1 and 4.2 (2006).
It is also necessary to evaluate the disability from the
point of view of the veteran working or seeking work,
38 C.F.R. § 4.2 (2006), and to resolve any reasonable doubt
regarding the extent of the disability in the veteran's
favor, 38 C.F.R. § 4.3 (2006). If there is a question as to
which evaluation to apply to the veteran's disability, the
higher evaluation will be assigned if the disability picture
more nearly approximates the criteria for that rating;
otherwise, the lower rating will be assigned. 38 C.F.R.
§ 4.7 (2006).
Service connection for membranous nephritis was granted
effective from April 1, 2002. A zero percent rating was
assigned under Diagnostic Code 7502, for chronic nephritis.
In a November 2006 rating decision, a 30 percent disability
rating was awarded under Diagnostic Code 7502 effective
October 11, 2006, the date of the most recent VA examination
which showed for the first time that the veteran has
hypertension, stable on medication, due to his service-
connected membranous nephritis.
Diagnostic Code 7502 indicates any resulting disability is to
be rated under the criteria for renal dysfunction. Renal
dysfunction with albumin and casts with history of acute
nephritis; or, hypertension non-compensable under Diagnostic
Code 7101 warrants a noncompensable evaluation. Renal
dysfunction with albumin constant or recurring with hyaline
and granular casts or red blood cells; or, transient or
slight edema or hypertension at least 10 percent disabling
under Diagnostic Code 7101 warrants a 30 percent evaluation.
A 60 percent evaluation requires constant albuminuria with
some edema; or definite decrease in kidney function; or
hypertension at least 40 percent disabling under Diagnostic
Code 7101. 38 C.F.R. § 4.115a, Diagnostic Code 7502 (2006).
Upon receipt of the veteran's claim, he was afforded VA
medical examinations in May 2002. The veteran reported that
on November 2000 during a routine flight physical, it was
revealed that he had high cholesterol and microscopic
hematuria. He was started on Zocor and was followed up.
Ultimately he underwent a kidney biopsy, which revealed
membranous nephritis. He was subsequently started on Lasix
for edema of his legs. He reported no symptoms. The
diagnosis was membranous nephritis. Laboratory studies were
requested and the reports are attached. Urinalysis showed
protein 2+, urine blood 1+, and red blood cell count of 4 to
7. The lab report indicates that these readings are all
high. However, no urine crystals or casts were found.
Veteran submitted a treatment record from the Walter Reed
Medical Center's nephrology clinic from October 2003. This
treatment note shows follow-up for the veteran's chronic
membranous nephritis. It was noted that the veteran
currently had no chest pain, shortness of breath, lower
extremity edema, dysuria, urgency, frequency or herniation.
The veteran denied fever, pain, weight changes, or night
sweats. Physical examination appears to have been
unremarkable. The veteran's blood pressure that day was
111/71. The assessment was membranous nephritis by biopsy in
2001 with normal GSR, no proteinuria or edema; persistent
urinary abnormality consisting of microscopic hematuria most
likely secondary to membranous nephritis; and hyperlipidemia.
In support of this claim, the veteran submitted a letter from
a nephrology fellow at the Walter Reed Medical Center dated
in December 2004. This doctor states in his letter that,
since the time of this claim, the veteran has had further
urological workup to include urethro-cystoscopy, which
revealed no urological source of bleeding, thus making his
hematuria likely glomerular in nature. This finding, coupled
with his albuminuria and transient edema, meets the stated
requirements for a 30 percent disability rating. Attached to
this doctor's letter is the report of a urinalysis from
October 2004. This report shows protein was 30 and red blood
cells were 5 to 9. It also shows a 24-hour urine collection
contained protein of 278 mg, which was marked as high.
Treatment records from the Walter Reed Medical Center
included laboratory reports from August 2004 through June
2005, including the October 2004 results just discussed
above. These records, however, do not add any additional
relevant information.
A second VA genitourinary examination was afforded the
veteran in October 2006. The veteran reported no complaints
of lethargy, weakness or anorexia. He reported gaining 10
pounds in one year, and his current weight was 165 pounds.
He also reported nocturia of two times at night and during
the daytime every one or two hours, but he denied hesitancy
or dysuria. As for the effect on his occupation and daily
activities, the veteran reported that he has a desk job and
thus, except for frequent trips to the bathroom, his medical
problem has not affected him. The veteran reported that he
takes Lasix 10 mg per day for peripheral edema and lisinopril
for high blood pressure, which was discovered in May 2005.
Other than those listed, the veteran denied any other
symptoms or problems. He also denied any hospitalizations or
dialysis for his condition. On objective examination, his
blood pressure was 124/80. No specific residuals of
genitourinary disease were noted. No bilateral edema was
noted. Peripheral pulses were normal on both sides. The
diagnosis was membrane glomerular nephritis, chronic. In
addition, the examiner diagnosed the veteran to have
hypertension, which the examiner stated is most likely a
complication of the nephritis. The examiner ordered a 24-
hour urine and a urinalysis. The results are included in the
examiner's report. The results of the urinalysis show urine
protein of 2+, urine blood of 1+ and a red blood cell count
of 1 to 5. No 24-hour results are given as it appears that
no specimen was received.
After considering all of the evidence of record, however, the
Board finds sufficient evidence to award a 30 percent
disability rating for the veteran's membranous nephritis back
to April 1, 2002, the effective date of service connection.
As noted above, a 30 percent rating is warranted for
nephritis resulting in albumin constant or recurring with
hyaline and granular casts or red blood cells, or
hypertension to a compensable degree, or slight or transient
edema. The medical evidence reflects the veteran has had
albumin (protein) and red blood cells constantly in his
urine.
In addition, the medical evidence reflects that the veteran
has been on Lasix since service for edema of the lower
extremities caused by his service-connected membranous
nephritis. Although the medical evidence does not show any
objective findings of edema in the lower extremities, the
veteran's edema is clearly well-managed with the Lasix. The
simple fact, however, that the veteran continues to require
the use of Lasix to control lower extremity edema presumes
that he at least has that condition to some degree.
Either of these two findings alone is sufficient for
evaluating veteran's service-connected membranous nephritis
as 30 percent disabling from the date of this claim. The
diagnosis of hypertension controlled with the use of
medication is merely another criteria upon which to base a 30
percent disability rating. Basing a 30 percent rating on
hypertension alone, however is not the most beneficial to the
veteran who, by his own report, was not treated for it until
May 2005. Thus a rating based upon hypertension alone would
not grant him a compensable rating prior to October 11, 2006,
because this is the first date that the medical evidence
shows the veteran has hypertension.
However, an initial rating in excess of 30 percent is not
warranted for any time period since the grant of service
connection for this disability. Review of the evidence of
record indicates none of the requirements for a 60 percent
rating for membranous nephritis have been met. The veteran
has not demonstrated constant albuminuria with some edema.
Although urine screens were positive for excessive urine
protein levels, no medical examiner has diagnosed constant
albuminuria. Furthermore, although the veteran uses Lasix to
control lower extremity edema, there is no objective evidence
of uncontrolled edema. The medical evidence also does not
demonstrate that the veteran has a definite decrease in
kidney function. Finally, the medical evidence does not show
that the veteran has had hypertension that is at least 40
percent disabling under Diagnostic Code 7101, which would
require diastolic pressure predominantly of 120 or more. The
veteran's diastolic pressure readings of record are all less
than 120. Overall, the preponderance of the evidence is
against an initial disability rating in excess of 30 percent
for the veteran's membranous nephritis.
The Board notes that, at his hearing in March 2005, the
veteran argued that the medical evidence supported a 30
percent disability rating. By this decision, the Board
agrees with the veteran but does not find a rating higher
than 30 percent is warranted.
For the foregoing reasons, the Board finds that the
preponderance of the evidence is in favor of granting a
disability rating of 30 percent effective April 1, 2002 for
the veteran's service-connected membranous nephritis, but a
higher rating is not warranted.
II. Notice and Assistance Requirements
38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5107 and 5126 (West
2002 & Supp. 2005); 38 C.F.R. §§ 3.102, 3.156(a), 3.159 and
3.326(a) (2006) describe VA's duties to notify and assist
claimants in substantiating a claim for VA benefits.
Upon receipt of a complete or substantially complete
application for a service-connection claim, 38 U.S.C.
§ 5103(a) and 38 C.F.R. § 3.159(b) require VA to review the
information and the evidence presented with the claim and
notify the claimant and his or her representative, if any, of
what information and evidence not already provided, if any,
is necessary to substantiate, or will assist in
substantiating, each of the five elements of the claim
including notice that a disability rating and an effective
date for the award of benefits will be assigned if service
connection is awarded. 38 U.S.C.A. § 5103(a) (West 2002);
38 C.F.R. § 3.159(b) (2006); Quartuccio v. Principi, 16 Vet.
App. 183 (2002); Dingess v. Nicholson, 19 Vet. App. 473
(2006).
Sufficient notice must inform the claimant (1) of any
information and evidence not of record that is necessary to
substantiate the claim; (2) of the information and evidence
that VA will seek to provide; (3) of the information and
evidence that the claimant is expected to provide; and (4)
that he or she should provide any evidence in his or her
possession that pertains to the claim. Notice should be
provided to a claimant before the initial unfavorable agency
of original jurisdiction (AOJ) decision on a claim.
38 C.F.R. § 3.159(b)(1) (2006); Pelegrini v. Principi, 18
Vet. App. 112 (2004); see also Mayfield v. Nicholson, 19 Vet.
App. 103 (2005), rev'd on other grounds, 444 F.3d 1328 (Fed.
Cir. 2006).
In the present case, notice was provided to the veteran in
May 2002, prior to the initial AOJ decision on his claim for
service connection. The Board notes that the veteran's claim
for service connection was granted in a January 2003 rating
decision and his membranous nephritis was evaluated as zero
percent disabling effective April 1, 2002. The veteran
disagreed with the zero percent evaluation of this now
service-connected disability in January 2004. The Board
finds that since the veteran's claim was initially one for
service connection, which has been granted, VA's obligation
to notify the veteran was met as the claim for service
connection was obviously substantiated. See Dingess v.
Nicholson, 19 Vet. App. 473 (2006). Therefore, any
deficiency in the May 2002 notice relating to the veteran's
appeal is not prejudicial to the veteran, and no further
notice is necessary. Nevertheless, notice on how to
establish entitlement to an increased disability rating was
provided on July 2006, and the veteran's claim was
readjudicated in November 2006. Thus the Board finds there
is no prejudice to the veteran in proceeding to adjudicate
his claim.
The Board also notes that the veteran was provided notice in
the July 2006 notice pursuant to Dingess v. Nicholson, 19
Vet. App. 473 (2006), that an effective date for the award of
benefits will be assigned if the benefit sought is awarded.
Thus the Board finds that the veteran is not prejudiced by
VA's failure to provide notice earlier on these elements of
his claim as the veteran was provided proper notice and
readjudication of his claim after an opportunity to respond.
Finally, the veteran has been afforded a meaningful
opportunity to participate effectively in the processing of
his claim. He was told it was his responsibility to support
the claim with appropriate evidence and has been given the
regulations applicable to VA's duty to notify and assist.
Indeed, the veteran submitted substantial evidence in
connection with his claim, which indicates he knew of the
need to provide VA with information and evidence to support
his claim. Thus the Board finds that the purposes behind
VA's notice requirement have been satisfied, and VA has
satisfied its "duty to notify" the veteran.
With respect to VA's duty to assist, the RO attempted to
obtain all medical records identified by the veteran. The
veteran did not identify any VA treatment. The veteran
identified treatment at Walter Reed Medical Center since his
retirement from the service and provided a copy of some
treatment records for his service-connected membranous
nephritis, which were requested on remand. In addition the
veteran submitted a statement from his personal nephrologist
dated in December 2004. The veteran was notified in the
rating decision, Statement of the Case and Supplemental
Statements of the Case of what evidence the RO had obtained
and considered in rendering its decisions. He has not
identified any additional evidence to support his claim. VA
is only required to make reasonable efforts to obtain
relevant records that the veteran has adequately identified
to VA. 38 U.S.C.A. § 5103A(b)(1) (West 2002). VA,
therefore, has made every reasonable effort to obtain all
records relevant to the veteran's claim.
The duty to assist also includes providing a medical
examination or obtaining a medical opinion when such is
necessary to make a decision on the claim. The veteran was
afforded VA examinations on his claim in May 2002 and October
2006.
Thus, the Board finds that VA has satisfied its duties to
inform and assist the veteran at every stage of this case.
Additional efforts to assist or notify him would serve no
useful purpose. Therefore, he is not prejudiced as a result
of the Board proceeding to the merits of his claim.
ORDER
Entitlement to an initial disability rating of 30 percent,
but no higher, for membranous nephritis is granted effective
April 1, 2002, subject to controlling regulations governing
the payment of monetary benefits.
____________________________________________
CONSTANCE B. TOBIAS
Veterans Law Judge, Board of Veterans' Appeals
Department of Veterans Affairs | 04-27-2007 | [
"Citation Nr: 0712466 Decision Date: 04/27/07 Archive Date: 05/08/07 DOCKET NO. 04-27 986 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Baltimore, Maryland THE ISSUE Entitlement to an initial rating for service-connected membranous nephritis in excess of zero percent as of April 1, 2002, and 30 percent as of October 11, 2006. REPRESENTATION Appellant represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL Appellant ATTORNEY FOR THE BOARD S. M. Kreitlow, Associate Counsel INTRODUCTION The veteran had active military service from May 1981 to March 2002. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a January 2003 rating decision of the Department of Veterans Affairs (VA) Regional Office (RO) in Baltimore, Maryland. FINDINGS OF FACT 1.",
"Service connection for membranous nephritis was granted effective April 1, 2002. 2. The medical evidence shows that the veteran has constant albumin in his urine with red blood cells in excess of the normal range. In addition, the medical evidence shows that the veteran is now treated for hypertension that is related to his service-connected membranous nephritis. 3. The veteran's membranous nephritis is not productive of constant albuminuria with some edema; or definite decreasing kidney function; or hypertension at least 40 percent disabling under diagnostic code 7101. CONCLUSIONS OF LAW 1. The criteria for an initial disability rating of 30 percent effective April 1, 2002 and thereafter for membranous nephritis, with albumin constant with red blood cells and hypertension, are met.",
"38 U.S.C.A. §§ 1155, 5103, 5103A and 5107 (West 2002 & Supp. 2005); 38 C.F.R. §§ 3.102, 3.159, 4.1, 4.2, 4.3, 4.7 and 4.115b, Diagnostic Code 7502 (2006). 2. The criteria for a disability rating in excess of 30 percent for membranous nephritis are not met. 38 U.S.C.A. §§ 1155, 5103, 5103A and 5107 (West 2002 & Supp. 2005); 38 C.F.R. §§ 3.102, 3.159, 4.1, 4.2, 4.3, 4.7 and 4.115b, Diagnostic Code 7502 (2006). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS I. Analysis Disability ratings are intended to compensate impairment in earning capacity due to a service-connected disorder. 38 U.S.C.A. § 1155 (West 2002). Separate diagnostic codes identify the various disabilities. Id. Evaluation of a service-connected disorder requires a review of the veteran's entire medical history regarding that disorder. 38 C.F.R. §§ 4.1 and 4.2 (2006).",
"It is also necessary to evaluate the disability from the point of view of the veteran working or seeking work, 38 C.F.R. § 4.2 (2006), and to resolve any reasonable doubt regarding the extent of the disability in the veteran's favor, 38 C.F.R. § 4.3 (2006). If there is a question as to which evaluation to apply to the veteran's disability, the higher evaluation will be assigned if the disability picture more nearly approximates the criteria for that rating; otherwise, the lower rating will be assigned. 38 C.F.R. § 4.7 (2006). Service connection for membranous nephritis was granted effective from April 1, 2002. A zero percent rating was assigned under Diagnostic Code 7502, for chronic nephritis. In a November 2006 rating decision, a 30 percent disability rating was awarded under Diagnostic Code 7502 effective October 11, 2006, the date of the most recent VA examination which showed for the first time that the veteran has hypertension, stable on medication, due to his service- connected membranous nephritis.",
"Diagnostic Code 7502 indicates any resulting disability is to be rated under the criteria for renal dysfunction. Renal dysfunction with albumin and casts with history of acute nephritis; or, hypertension non-compensable under Diagnostic Code 7101 warrants a noncompensable evaluation. Renal dysfunction with albumin constant or recurring with hyaline and granular casts or red blood cells; or, transient or slight edema or hypertension at least 10 percent disabling under Diagnostic Code 7101 warrants a 30 percent evaluation. A 60 percent evaluation requires constant albuminuria with some edema; or definite decrease in kidney function; or hypertension at least 40 percent disabling under Diagnostic Code 7101. 38 C.F.R. § 4.115a, Diagnostic Code 7502 (2006). Upon receipt of the veteran's claim, he was afforded VA medical examinations in May 2002. The veteran reported that on November 2000 during a routine flight physical, it was revealed that he had high cholesterol and microscopic hematuria. He was started on Zocor and was followed up. Ultimately he underwent a kidney biopsy, which revealed membranous nephritis. He was subsequently started on Lasix for edema of his legs. He reported no symptoms.",
"The diagnosis was membranous nephritis. Laboratory studies were requested and the reports are attached. Urinalysis showed protein 2+, urine blood 1+, and red blood cell count of 4 to 7. The lab report indicates that these readings are all high. However, no urine crystals or casts were found. Veteran submitted a treatment record from the Walter Reed Medical Center's nephrology clinic from October 2003. This treatment note shows follow-up for the veteran's chronic membranous nephritis. It was noted that the veteran currently had no chest pain, shortness of breath, lower extremity edema, dysuria, urgency, frequency or herniation. The veteran denied fever, pain, weight changes, or night sweats. Physical examination appears to have been unremarkable.",
"The veteran's blood pressure that day was 111/71. The assessment was membranous nephritis by biopsy in 2001 with normal GSR, no proteinuria or edema; persistent urinary abnormality consisting of microscopic hematuria most likely secondary to membranous nephritis; and hyperlipidemia. In support of this claim, the veteran submitted a letter from a nephrology fellow at the Walter Reed Medical Center dated in December 2004. This doctor states in his letter that, since the time of this claim, the veteran has had further urological workup to include urethro-cystoscopy, which revealed no urological source of bleeding, thus making his hematuria likely glomerular in nature. This finding, coupled with his albuminuria and transient edema, meets the stated requirements for a 30 percent disability rating. Attached to this doctor's letter is the report of a urinalysis from October 2004.",
"This report shows protein was 30 and red blood cells were 5 to 9. It also shows a 24-hour urine collection contained protein of 278 mg, which was marked as high. Treatment records from the Walter Reed Medical Center included laboratory reports from August 2004 through June 2005, including the October 2004 results just discussed above. These records, however, do not add any additional relevant information. A second VA genitourinary examination was afforded the veteran in October 2006. The veteran reported no complaints of lethargy, weakness or anorexia. He reported gaining 10 pounds in one year, and his current weight was 165 pounds. He also reported nocturia of two times at night and during the daytime every one or two hours, but he denied hesitancy or dysuria. As for the effect on his occupation and daily activities, the veteran reported that he has a desk job and thus, except for frequent trips to the bathroom, his medical problem has not affected him.",
"The veteran reported that he takes Lasix 10 mg per day for peripheral edema and lisinopril for high blood pressure, which was discovered in May 2005. Other than those listed, the veteran denied any other symptoms or problems. He also denied any hospitalizations or dialysis for his condition. On objective examination, his blood pressure was 124/80. No specific residuals of genitourinary disease were noted. No bilateral edema was noted. Peripheral pulses were normal on both sides. The diagnosis was membrane glomerular nephritis, chronic. In addition, the examiner diagnosed the veteran to have hypertension, which the examiner stated is most likely a complication of the nephritis. The examiner ordered a 24- hour urine and a urinalysis.",
"The results are included in the examiner's report. The results of the urinalysis show urine protein of 2+, urine blood of 1+ and a red blood cell count of 1 to 5. No 24-hour results are given as it appears that no specimen was received. After considering all of the evidence of record, however, the Board finds sufficient evidence to award a 30 percent disability rating for the veteran's membranous nephritis back to April 1, 2002, the effective date of service connection. As noted above, a 30 percent rating is warranted for nephritis resulting in albumin constant or recurring with hyaline and granular casts or red blood cells, or hypertension to a compensable degree, or slight or transient edema. The medical evidence reflects the veteran has had albumin (protein) and red blood cells constantly in his urine. In addition, the medical evidence reflects that the veteran has been on Lasix since service for edema of the lower extremities caused by his service-connected membranous nephritis. Although the medical evidence does not show any objective findings of edema in the lower extremities, the veteran's edema is clearly well-managed with the Lasix. The simple fact, however, that the veteran continues to require the use of Lasix to control lower extremity edema presumes that he at least has that condition to some degree.",
"Either of these two findings alone is sufficient for evaluating veteran's service-connected membranous nephritis as 30 percent disabling from the date of this claim. The diagnosis of hypertension controlled with the use of medication is merely another criteria upon which to base a 30 percent disability rating. Basing a 30 percent rating on hypertension alone, however is not the most beneficial to the veteran who, by his own report, was not treated for it until May 2005. Thus a rating based upon hypertension alone would not grant him a compensable rating prior to October 11, 2006, because this is the first date that the medical evidence shows the veteran has hypertension. However, an initial rating in excess of 30 percent is not warranted for any time period since the grant of service connection for this disability.",
"Review of the evidence of record indicates none of the requirements for a 60 percent rating for membranous nephritis have been met. The veteran has not demonstrated constant albuminuria with some edema. Although urine screens were positive for excessive urine protein levels, no medical examiner has diagnosed constant albuminuria. Furthermore, although the veteran uses Lasix to control lower extremity edema, there is no objective evidence of uncontrolled edema. The medical evidence also does not demonstrate that the veteran has a definite decrease in kidney function.",
"Finally, the medical evidence does not show that the veteran has had hypertension that is at least 40 percent disabling under Diagnostic Code 7101, which would require diastolic pressure predominantly of 120 or more. The veteran's diastolic pressure readings of record are all less than 120. Overall, the preponderance of the evidence is against an initial disability rating in excess of 30 percent for the veteran's membranous nephritis. The Board notes that, at his hearing in March 2005, the veteran argued that the medical evidence supported a 30 percent disability rating. By this decision, the Board agrees with the veteran but does not find a rating higher than 30 percent is warranted. For the foregoing reasons, the Board finds that the preponderance of the evidence is in favor of granting a disability rating of 30 percent effective April 1, 2002 for the veteran's service-connected membranous nephritis, but a higher rating is not warranted.",
"II. Notice and Assistance Requirements 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5107 and 5126 (West 2002 & Supp. 2005); 38 C.F.R. §§ 3.102, 3.156(a), 3.159 and 3.326(a) (2006) describe VA's duties to notify and assist claimants in substantiating a claim for VA benefits. Upon receipt of a complete or substantially complete application for a service-connection claim, 38 U.S.C. § 5103(a) and 38 C.F.R. § 3.159(b) require VA to review the information and the evidence presented with the claim and notify the claimant and his or her representative, if any, of what information and evidence not already provided, if any, is necessary to substantiate, or will assist in substantiating, each of the five elements of the claim including notice that a disability rating and an effective date for the award of benefits will be assigned if service connection is awarded.",
"38 U.S.C.A. § 5103(a) (West 2002); 38 C.F.R. § 3.159(b) (2006); Quartuccio v. Principi, 16 Vet. App. 183 (2002); Dingess v. Nicholson, 19 Vet. App. 473 (2006). Sufficient notice must inform the claimant (1) of any information and evidence not of record that is necessary to substantiate the claim; (2) of the information and evidence that VA will seek to provide; (3) of the information and evidence that the claimant is expected to provide; and (4) that he or she should provide any evidence in his or her possession that pertains to the claim. Notice should be provided to a claimant before the initial unfavorable agency of original jurisdiction (AOJ) decision on a claim.",
"38 C.F.R. § 3.159(b)(1) (2006); Pelegrini v. Principi, 18 Vet. App. 112 (2004); see also Mayfield v. Nicholson, 19 Vet. App. 103 (2005), rev'd on other grounds, 444 F.3d 1328 (Fed. Cir. 2006). In the present case, notice was provided to the veteran in May 2002, prior to the initial AOJ decision on his claim for service connection. The Board notes that the veteran's claim for service connection was granted in a January 2003 rating decision and his membranous nephritis was evaluated as zero percent disabling effective April 1, 2002.",
"The veteran disagreed with the zero percent evaluation of this now service-connected disability in January 2004. The Board finds that since the veteran's claim was initially one for service connection, which has been granted, VA's obligation to notify the veteran was met as the claim for service connection was obviously substantiated. See Dingess v. Nicholson, 19 Vet. App. 473 (2006). Therefore, any deficiency in the May 2002 notice relating to the veteran's appeal is not prejudicial to the veteran, and no further notice is necessary. Nevertheless, notice on how to establish entitlement to an increased disability rating was provided on July 2006, and the veteran's claim was readjudicated in November 2006. Thus the Board finds there is no prejudice to the veteran in proceeding to adjudicate his claim. The Board also notes that the veteran was provided notice in the July 2006 notice pursuant to Dingess v. Nicholson, 19 Vet. App.",
"473 (2006), that an effective date for the award of benefits will be assigned if the benefit sought is awarded. Thus the Board finds that the veteran is not prejudiced by VA's failure to provide notice earlier on these elements of his claim as the veteran was provided proper notice and readjudication of his claim after an opportunity to respond. Finally, the veteran has been afforded a meaningful opportunity to participate effectively in the processing of his claim.",
"He was told it was his responsibility to support the claim with appropriate evidence and has been given the regulations applicable to VA's duty to notify and assist. Indeed, the veteran submitted substantial evidence in connection with his claim, which indicates he knew of the need to provide VA with information and evidence to support his claim. Thus the Board finds that the purposes behind VA's notice requirement have been satisfied, and VA has satisfied its \"duty to notify\" the veteran. With respect to VA's duty to assist, the RO attempted to obtain all medical records identified by the veteran. The veteran did not identify any VA treatment.",
"The veteran identified treatment at Walter Reed Medical Center since his retirement from the service and provided a copy of some treatment records for his service-connected membranous nephritis, which were requested on remand. In addition the veteran submitted a statement from his personal nephrologist dated in December 2004. The veteran was notified in the rating decision, Statement of the Case and Supplemental Statements of the Case of what evidence the RO had obtained and considered in rendering its decisions. He has not identified any additional evidence to support his claim.",
"VA is only required to make reasonable efforts to obtain relevant records that the veteran has adequately identified to VA. 38 U.S.C.A. § 5103A(b)(1) (West 2002). VA, therefore, has made every reasonable effort to obtain all records relevant to the veteran's claim. The duty to assist also includes providing a medical examination or obtaining a medical opinion when such is necessary to make a decision on the claim. The veteran was afforded VA examinations on his claim in May 2002 and October 2006. Thus, the Board finds that VA has satisfied its duties to inform and assist the veteran at every stage of this case. Additional efforts to assist or notify him would serve no useful purpose. Therefore, he is not prejudiced as a result of the Board proceeding to the merits of his claim. ORDER Entitlement to an initial disability rating of 30 percent, but no higher, for membranous nephritis is granted effective April 1, 2002, subject to controlling regulations governing the payment of monetary benefits. ____________________________________________ CONSTANCE B. TOBIAS Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs"
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
675 N.W.2d 626 (2004) In re Petition for DISCIPLINARY ACTION AGAINST Kenneth F. JOHANNSON, a Minnesota Attorney, Registration No. 5043X. No. A04-246. Supreme Court of Minnesota. March 9, 2004. ORDER The Director of the Office of Lawyers Professional Responsibility has filed a petition for disciplinary action alleging that respondent Kenneth F. Johannson has committed professional misconduct warranting public discipline, namely, that respondent engaged in a sexual relationship with a client in 1998 and 1999 in violation of Minn. R. Prof. Conduct 1.8(k). Respondent admits his conduct violated the Rules of Professional Conduct, waives his rights under Rule 14, Rules on Lawyers Professional Responsibility (RLPR), and has entered into a stipulation with the Director in which they jointly recommend that the appropriate discipline is a 90-day *627 suspension and payment of $900 in costs under Rule 24, RLPR. This court has independently reviewed the file and approves the jointly recommended disposition. Based upon all the files, records and proceedings herein, IT IS HEREBY ORDERED that respondent Kenneth F. Johannson is suspended from the practice of law for 90 days effective 14 days from the date of this order. Respondent may be reinstated under Rule 18(f), RLPR, by filing an affidavit with the Clerk of Appellate Courts and the Director of the Office of Lawyers Professional Responsibility 15 days prior to the expiration of the 90-day suspension establishing that he is current with continuing legal education requirements and has fully complied with Rules 24 and 26, RLPR. Respondent shall pay $900 in costs under Rule 24, RLPR. BY THE COURT: /s/Paul H. Anderson Associate Justice ANDERSON, Russell A., took no part in the consideration or decision of this case. | 10-30-2013 | [
"675 N.W.2d 626 (2004) In re Petition for DISCIPLINARY ACTION AGAINST Kenneth F. JOHANNSON, a Minnesota Attorney, Registration No. 5043X. No. A04-246. Supreme Court of Minnesota. March 9, 2004. ORDER The Director of the Office of Lawyers Professional Responsibility has filed a petition for disciplinary action alleging that respondent Kenneth F. Johannson has committed professional misconduct warranting public discipline, namely, that respondent engaged in a sexual relationship with a client in 1998 and 1999 in violation of Minn. R. Prof. Conduct 1.8(k).",
"Respondent admits his conduct violated the Rules of Professional Conduct, waives his rights under Rule 14, Rules on Lawyers Professional Responsibility (RLPR), and has entered into a stipulation with the Director in which they jointly recommend that the appropriate discipline is a 90-day *627 suspension and payment of $900 in costs under Rule 24, RLPR. This court has independently reviewed the file and approves the jointly recommended disposition. Based upon all the files, records and proceedings herein, IT IS HEREBY ORDERED that respondent Kenneth F. Johannson is suspended from the practice of law for 90 days effective 14 days from the date of this order. Respondent may be reinstated under Rule 18(f), RLPR, by filing an affidavit with the Clerk of Appellate Courts and the Director of the Office of Lawyers Professional Responsibility 15 days prior to the expiration of the 90-day suspension establishing that he is current with continuing legal education requirements and has fully complied with Rules 24 and 26, RLPR. Respondent shall pay $900 in costs under Rule 24, RLPR.",
"BY THE COURT: /s/Paul H. Anderson Associate Justice ANDERSON, Russell A., took no part in the consideration or decision of this case."
] | https://www.courtlistener.com/api/rest/v3/opinions/1936415/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
F I L E D United States Court of Appeals Tenth Circuit UNITED STATES CO URT O F APPEALS February 23, 2007 FO R TH E TENTH CIRCUIT Elisabeth A. Shumaker Clerk of Court
U N ITED STA TES O F A M ER ICA,
Plaintiff-Appellee,
v. No. 06-2272 (D.C. No. CR-05-2120-JC) TER RY BEN N ETT WILLIA M SON, (D . N.M .)
Defendant-Appellant.
OR D ER AND JUDGM ENT *
Before HA RTZ, O’BRIEN, and TYM KOVICH, Circuit Judges.
Defendant Terry Bennett W illiamson pled guilty to one count of possession
with intent to distribute five grams or more of methamphetamine in violation of
21 U.S.C. §§ 841(a)(1) and 841(b)(1)(B), and one count of possession with intent
to distribute less than fifty grams of a mixture or substance containing
methamphetamine in violation of 21 U.S.C. §§ 841(a)(1) and 841(b)(1)(C). His
* This panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without oral argument. This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1. plea agreement states that he “know ingly waives the right to appeal [his]
conviction and/or any sentence within the statutory maximum authorized by law.”
Plea Agreement at 5 (dated and filed Feb. 21, 2006). The district court imposed a
sentence of 188 months’ imprisonment, to be followed by a four-year term of
unsupervised release. His sentence is within the statutory maximum sentence of
forty-four years and within the advisory guideline range of 188 to 235 months.
Despite this appeal waiver, defendant filed a notice of appeal. The
government has moved to enforce his appeal waiver under United States v. Hahn,
359 F.3d 1315 (10th Cir. 2004) (en banc) (per curiam). Under Hahn, we will
enforce a criminal defendant’s waiver of his right to appeal so long as (1) “the
disputed appeal falls within the scope of the waiver of appellate rights”; (2) “the
defendant knowingly and voluntarily waived his appellate rights”; and
(3) “enforcing the waiver would [not] result in a miscarriage of justice.” Id.
at 1325, 1327. The miscarriage-of-justice prong requires the defendant to show
(a) his sentence relied on an impermissible factor such as race; (b) ineffective
assistance of counsel in connection with the negotiation of the appeal waiver
rendered the waiver invalid; (c) his sentence exceeded the statutory maximum; or
(d) his appeal waiver is otherw ise unlawful. Id. at 1327. The government’s
motion addresses all of these considerations, explaining why none of them
undermine defendant’s appeal waiver. Upon review of the pertinent plea and
sentencing materials, we agree.
-2- Defendant argues as a threshold matter that the government’s motion to
enforce is untimely under 10th Cir. R. 27.2(A)(3), which provides that such
motions “must be filed within 15 days after the notice of appeal is filed.”
The cited rule allow s for late filing “upon a showing of good cause,” and we
conclude that cause has been shown for the delayed filing here.
Next, defendant contends that his appeal falls outside the scope of his
appeal waiver and that enforcing the appeal waiver would be a miscarriage of
justice because the sentence imposed was unreasonable under United States v.
Booker, 543 U.S. 220 (2005). In support of this claim, he asserts that the district
court should not have ruled that he is a career criminal under the advisory
sentencing guidelines because his two prior drug convictions were related
offenses. He further argues that his appeal waiver was unknowing because he did
not agree to be unreasonably sentenced. None of his contentions have merit.
The issue that defendant seeks to appeal falls squarely within the specific
appellate w aiver, which prohibits an appeal of “any sentence w ithin the statutory
maximum authorized by law .” Plea Agreement at 5. The plea agreement clearly
set out the maximum sentence defendant faced and explained the appellate rights
he relinquished in exchange for the benefits offered by the government.
As to his miscarriage-of-justice claim that his appeal waiver was otherwise
unlawful, defendant must show that the error “seriously affect[s] the fairness,
integrity or public reputation of judicial proceedings.” Hahn, 359 F.3d at 1327
-3- (quotation omitted and alteration made). Defendant’s arguments do not support
the miscarriage-of-justice exception because his claims only concern the
lawfulness of his sentence; he has not asserted any claim regarding the critical
issue of whether his appeal waiver w as itself unlawful. See United States v.
Porter, 405 F.3d 1136, 1144 (10th Cir.), cert. denied, 126 S. Ct. 550 (2005) (“The
relevant question . . . is not whether [defendant’s] sentence is unlawful . . . , but
whether . . . his appeal waiver itself [is] unenforceable.”); see also Hahn, 359
F.3d at 1326 & n.12 (discussing knowing and voluntary prong and recognizing
“the logical failings of focusing on the result of a proceeding, rather than on the
right relinquished, in analyzing whether an appeal is unknowing or involuntary”).
Indeed, to hold that alleged errors under the sentencing guidelines render an
appeal waiver unlaw ful would nullify the waiver based on the very sort of claim it
was intended to waive. Nor has defendant otherwise shown that enforcement of
the waiver would seriously affect the fairness, integrity, or public reputation of
the judicial proceedings.
Further, as to defendant’s argument that his w aiver was unknowing, this
court has “consistently and repeatedly held that broad [appeal] waivers are
enforceable even where they are not contingent on the ultimate sentence falling
within an identified sentencing range.” United States v. M ontano, 472 F. 3d
1202, 1205 (10th Cir. 2007) (citing cases and expressly declining to adopt a rule
that an appeal waiver is unenforceable where defendant did not know at the time
-4- she entered the plea agreement what her sentencing range would be and that the
resulting sentence was greater than anticipated). The sentence imposed by the
district court complied with the terms of the plea agreement and with the
understanding of the plea that defendant expressed at the plea hearing. Defendant
has not demonstrated that his appeal falls outside the scope of the appeal waiver,
that he did not knowingly and voluntarily agree to the appeal waiver or that it
would be a miscarriage of justice to enforce the w aiver.
Accordingly, the government’s motion to enforce the waiver is GR AN TED
and the appeal is DISM ISSED. The mandate shall issue forthwith.
ENTERED FOR THE COURT PER CURIAM
-5- | 08-14-2010 | [
"F I L E D United States Court of Appeals Tenth Circuit UNITED STATES CO URT O F APPEALS February 23, 2007 FO R TH E TENTH CIRCUIT Elisabeth A. Shumaker Clerk of Court U N ITED STA TES O F A M ER ICA, Plaintiff-Appellee, v. No. 06-2272 (D.C. No. CR-05-2120-JC) TER RY BEN N ETT WILLIA M SON, (D . N.M .) Defendant-Appellant. OR D ER AND JUDGM ENT * Before HA RTZ, O’BRIEN, and TYM KOVICH, Circuit Judges. Defendant Terry Bennett W illiamson pled guilty to one count of possession with intent to distribute five grams or more of methamphetamine in violation of 21 U.S.C. §§ 841(a)(1) and 841(b)(1)(B), and one count of possession with intent to distribute less than fifty grams of a mixture or substance containing methamphetamine in violation of 21 U.S.C.",
"§§ 841(a)(1) and 841(b)(1)(C). His * This panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without oral argument. This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir.",
"R. 32.1. plea agreement states that he “know ingly waives the right to appeal [his] conviction and/or any sentence within the statutory maximum authorized by law.” Plea Agreement at 5 (dated and filed Feb. 21, 2006). The district court imposed a sentence of 188 months’ imprisonment, to be followed by a four-year term of unsupervised release. His sentence is within the statutory maximum sentence of forty-four years and within the advisory guideline range of 188 to 235 months. Despite this appeal waiver, defendant filed a notice of appeal. The government has moved to enforce his appeal waiver under United States v. Hahn, 359 F.3d 1315 (10th Cir.",
"2004) (en banc) (per curiam). Under Hahn, we will enforce a criminal defendant’s waiver of his right to appeal so long as (1) “the disputed appeal falls within the scope of the waiver of appellate rights”; (2) “the defendant knowingly and voluntarily waived his appellate rights”; and (3) “enforcing the waiver would [not] result in a miscarriage of justice.” Id. at 1325, 1327. The miscarriage-of-justice prong requires the defendant to show (a) his sentence relied on an impermissible factor such as race; (b) ineffective assistance of counsel in connection with the negotiation of the appeal waiver rendered the waiver invalid; (c) his sentence exceeded the statutory maximum; or (d) his appeal waiver is otherw ise unlawful. Id. at 1327. The government’s motion addresses all of these considerations, explaining why none of them undermine defendant’s appeal waiver. Upon review of the pertinent plea and sentencing materials, we agree. -2- Defendant argues as a threshold matter that the government’s motion to enforce is untimely under 10th Cir. R. 27.2(A)(3), which provides that such motions “must be filed within 15 days after the notice of appeal is filed.” The cited rule allow s for late filing “upon a showing of good cause,” and we conclude that cause has been shown for the delayed filing here.",
"Next, defendant contends that his appeal falls outside the scope of his appeal waiver and that enforcing the appeal waiver would be a miscarriage of justice because the sentence imposed was unreasonable under United States v. Booker, 543 U.S. 220 (2005). In support of this claim, he asserts that the district court should not have ruled that he is a career criminal under the advisory sentencing guidelines because his two prior drug convictions were related offenses. He further argues that his appeal waiver was unknowing because he did not agree to be unreasonably sentenced. None of his contentions have merit. The issue that defendant seeks to appeal falls squarely within the specific appellate w aiver, which prohibits an appeal of “any sentence w ithin the statutory maximum authorized by law .” Plea Agreement at 5.",
"The plea agreement clearly set out the maximum sentence defendant faced and explained the appellate rights he relinquished in exchange for the benefits offered by the government. As to his miscarriage-of-justice claim that his appeal waiver was otherwise unlawful, defendant must show that the error “seriously affect[s] the fairness, integrity or public reputation of judicial proceedings.” Hahn, 359 F.3d at 1327 -3- (quotation omitted and alteration made). Defendant’s arguments do not support the miscarriage-of-justice exception because his claims only concern the lawfulness of his sentence; he has not asserted any claim regarding the critical issue of whether his appeal waiver w as itself unlawful.",
"See United States v. Porter, 405 F.3d 1136, 1144 (10th Cir. ), cert. denied, 126 S. Ct. 550 (2005) (“The relevant question . . . is not whether [defendant’s] sentence is unlawful . . . , but whether . . . his appeal waiver itself [is] unenforceable.”); see also Hahn, 359 F.3d at 1326 & n.12 (discussing knowing and voluntary prong and recognizing “the logical failings of focusing on the result of a proceeding, rather than on the right relinquished, in analyzing whether an appeal is unknowing or involuntary”). Indeed, to hold that alleged errors under the sentencing guidelines render an appeal waiver unlaw ful would nullify the waiver based on the very sort of claim it was intended to waive. Nor has defendant otherwise shown that enforcement of the waiver would seriously affect the fairness, integrity, or public reputation of the judicial proceedings. Further, as to defendant’s argument that his w aiver was unknowing, this court has “consistently and repeatedly held that broad [appeal] waivers are enforceable even where they are not contingent on the ultimate sentence falling within an identified sentencing range.” United States v. M ontano, 472 F. 3d 1202, 1205 (10th Cir. 2007) (citing cases and expressly declining to adopt a rule that an appeal waiver is unenforceable where defendant did not know at the time -4- she entered the plea agreement what her sentencing range would be and that the resulting sentence was greater than anticipated).",
"The sentence imposed by the district court complied with the terms of the plea agreement and with the understanding of the plea that defendant expressed at the plea hearing. Defendant has not demonstrated that his appeal falls outside the scope of the appeal waiver, that he did not knowingly and voluntarily agree to the appeal waiver or that it would be a miscarriage of justice to enforce the w aiver. Accordingly, the government’s motion to enforce the waiver is GR AN TED and the appeal is DISM ISSED. The mandate shall issue forthwith. ENTERED FOR THE COURT PER CURIAM -5-"
] | https://www.courtlistener.com/api/rest/v3/opinions/168834/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
EXAMINER'S AMENDMENT An examiner’s amendment to the record appears below. Should the changes and/or additions be unacceptable to applicant, an amendment may be filed as provided by 37 CFR 1.312. To ensure consideration of such an amendment, it MUST be submitted no later than the payment of the issue fee.
Authorization for this examiner’s amendment was given in an interview with Nicole Clarke on 6/18/2021.
The application has been amended as follows: Claim 15 lines 10: acts as the anode and a current collector in the electrochemical battery. Claim 20 lines 9-12: wherein the anode acts as the anode and a current collector in the electrochemical battery. Claims 28-34 cancel. Claim 39 line 1: The electrochemical battery of claim 20, wherein the Reasons for Allowance The following is an examiner’s statement of reasons for allowance: The closest prior arts of record are Bartlett (US 2006/0201801); Xu (US 2011/0114254) and Takahashi (US 2013/0101907). However, the applicant’s arguments in conjunction with the applicant amendments submitted on 6/3/2021 are considered persuasive; therefore, the rejections have been withdrawn. The most important aspect being that each of the prior arts anodes contain . Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.” Contact Information Any inquiry concerning this communication or earlier communications from the examiner should be directed to BRIAN R OHARA whose telephone number is (571)272-0728. The examiner can normally be reached on 7:30 AM-3:30 PM EST M-F. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Miriam Stagg can be reached on 571-270-5256. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access
/BRIAN R OHARA/Examiner, Art Unit 1724 | 2021-06-25T15:04:47 | [
"EXAMINER'S AMENDMENT An examiner’s amendment to the record appears below. Should the changes and/or additions be unacceptable to applicant, an amendment may be filed as provided by 37 CFR 1.312. To ensure consideration of such an amendment, it MUST be submitted no later than the payment of the issue fee. Authorization for this examiner’s amendment was given in an interview with Nicole Clarke on 6/18/2021. The application has been amended as follows: Claim 15 lines 10: acts as the anode and a current collector in the electrochemical battery. Claim 20 lines 9-12: wherein the anode acts as the anode and a current collector in the electrochemical battery. Claims 28-34 cancel. Claim 39 line 1: The electrochemical battery of claim 20, wherein the Reasons for Allowance The following is an examiner’s statement of reasons for allowance: The closest prior arts of record are Bartlett (US 2006/0201801); Xu (US 2011/0114254) and Takahashi (US 2013/0101907).",
"However, the applicant’s arguments in conjunction with the applicant amendments submitted on 6/3/2021 are considered persuasive; therefore, the rejections have been withdrawn. The most important aspect being that each of the prior arts anodes contain . Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.” Contact Information Any inquiry concerning this communication or earlier communications from the examiner should be directed to BRIAN R OHARA whose telephone number is (571)272-0728. The examiner can normally be reached on 7:30 AM-3:30 PM EST M-F. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice.",
"If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Miriam Stagg can be reached on 571-270-5256. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access /BRIAN R OHARA/Examiner, Art Unit 1724"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-06-27.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Continued Examination Under 37 CFR 1.114 A request for continued examination under 37 CFR 1.114, including the fee set forth in 37 CFR 1.17(e), was filed in this application after final rejection. Since this application is eligible for continued examination under 37 CFR 1.114, and the fee set forth in 37 CFR 1.17(e) has been timely paid, the finality of the previous Office action has been withdrawn pursuant to 37 CFR 1.114. Applicant's submission filed on 5/24/21 has been entered. Applicant’s amendments to the claims dated 5/24/21 are acknowledged. Claims 1-11 and 14-15 are pending. Claims 12-13 are cancelled with the amendment of 5/24/21. Claim 8 is amended. Claims 1-7 and 15 are withdrawn. Claims 8-11 and 14 are subject to prosecution. Applicant’s supplemental amendment to the claims dated 5/26/21 are acknowledged. Claims 1-11 and 14-15 are pending. Claim 8 is amended. Claims 1-7 and 15 are withdrawn. Claims 8-11 and 14 are subject to prosecution.
WITHDRAWN REJECTIONS Any rejection not reiterated herein is WITHDRAWN in light of Applicant’s amendments to the claims. RESPONSE TO ARGUMENTS Applicant’s arguments with regard to a withdrawn rejection is moot. A response to any argument pertinent to a maintained or modified rejection of record can be found below.
The instant Application, filed 12/21/17 is a 371 National Stage Application of PCT/JP2016/068233, filed 06/20/2016, which claims priority to JP2015124569, filed 6/22/2015. A certified copy of the foreign priority document JP2015124569 (in Japanese) has been submitted in the instant Application. Thus, the earliest possible priority date for the instant Application is 06/22/2015.
CLAIMS Claims 8-11 and 14, as amended (showing changes from both the 5/24/21 AND 5/26/21 amendments), are drawn to, “A non-human animal that retains blood cells originating in a heterologous animal, in which the hematopoietic cells originating in the heterologous animal survive, said hematopoietic cells being cells in which a function of [[a]] LNK gene inhibited The claims read on a non-human animal comprising transplanted/engrafted heterologous genetically modified hematopoietic cells, wherein the non-human animal comprises blood cells from the engrafted heterologous modified hematopoietic cells, wherein the genetic modification is wherein “a function of LNK gene is inhibited.” The claims encompass transplantation between the same species (mouse to mouse, for example) or between different species (human to mouse, for example). The claims have been amended to delete the requirement that the recipient animal is “not an immunodeficient animal”. The claims have also been amended to require that any function of the LNK gene is inhibited in the cells.
MAINTAINED REJECTIONS Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. Claims 8-11 and 14 remain rejected under 35 U.S.C. 103 as being unpatentable over WO 01/58255 to Nakauchi, of record, cited on Applicant’s IDS dated 3/31/2020, further in view of Takizawa et al. Enhanced Engraftment of Hematopoietic Stem/Progenitor Cells by the Transient Inhibition of an Adaptor Protein, Lnk. Blood, 2006. 107(7):2968-2975, of record, cited on Applicant’s IDS dated 4/9/18. A machine translation of WO 01/58255 to Nakauchi is provided herewith, as the citation of WO 01/58255 to Nakauchi on the IDS is in Japanese with only an English Abstract. This rejection is modified in response to Applicant’s amendments to the claims. With regard to claim 8, Nakauchi discloses generating chimeric non-human animals comprising engrafted human hematopoietic stem cells, wherein the human hematopoietic stem cells are engrafted into the non-human animal fetal liver, and wherein the non-human animal continues to retain human Thus, Nakauchi discloses “A non-human animal that retains blood cells originating in a heterologous animal, in which the hematopoietic cells originating in the heterologous animal survive, and which retains the blood cells originating in the heterologous animal in the circulating blood, wherein the heterologous animal is of a species different from the non-human animal.” However, Nakauchi does not disclose wherein the engrafted hematopoietic cells are modified such that a function of LNK gene is inhibited, as required by instant claim 8. Takizawa discloses Lnk inhibition of donor hematopoietic stem cells increases their ability to be engrafted into recipient donor animals (Abstract, FIG 4C, page 2973). Takizawa discloses the donor hematopoietic stem cells with Lnk inhibition are modified to reduce Lnk Function, which Takizawa discloses likely results in increased proliferation through augmented cytokine receptor signaling, which results in increased donor HSC engraftment and survival (page 2973-2974). It would have been obvious to modify the cells of Nakauchi further with the disclosure of Takizawa. A skilled artisan would have been motivated to modify the human hematopoietic cells of Nakauchi to inhibit Lnk function according to Takizawa, because Takizawa discloses inhibition of Lnk increases HSC engraftment and survival in the recipient non-human animals. A skilled artisan would have had a reasonable expectation of success in practicing the claimed invention as modifying donor HSC to improve engraftment in a recipient non-human animal was known in the art at the time of the invention. With regard to claims 9-10, Nakauchi discloses the non-human animal is a pig (see, pages 2-5, including “Human Hematopoietic Stem Cell Transplantation into Porcine Fetuses” section of translation). With regard to claim 11, Nakauchi discloses the heterologous animal (donor) is a human, which reads on a mammal (see, pages 2-5, including “Human Hematopoietic Stem Cell Transplantation into Porcine Fetuses” section of translation). With regard to claim 14, Nakauchi discloses the donor cells are hematopoietic stem cells (see, pages 2-5, including “Human Hematopoietic Stem Cell Transplantation into Porcine Fetuses” section of translation).
RESPONSE TO ARGUMENTS Applicant’s arguments filed 5/24/2021 have been considered but are not persuasive. With regard to the 103 rejection in light of Nakauchi in view of Takizawa, Applicant argues the blood chimerism in the pigs at birth of Nakauchi is low, and the period of donor cell survival was as short as 38 days, pointing to animal D3585 therein, pointing to Table 2. Applicant also points to pigs W1048 and W549 who show FACs-detectable chimerism in bone marrow, but chimerism was low (0.04 and 0.58%), and that Nakauchi does not actually show chimerism in the peripheral blood. Thus, Applicant argues that the pigs of Nakauchi cannot be considered to retain human cells in the peripheral blood. The Examiner disagrees. Initially, the instant claims do not exclude fetal animals, nor only comprise animals surviving after birth, and if so, for how long. Regardless, Nakauchi shows the human donor cells are capable of survival for at least three months after transplantation in fetuses (see page 5 of translation, under “MEASUREMENT OF COLONY FORMING ABILITY OF HUMAN HEMATOPOIETIC STEM CELSS PRESENT IN PIG FETUSES” section). Further, D3735 of Table 2 shows presence of human CD34 cells in the PBL (peripheral blood) for 103 days after transplantation. Given transplantation occurred between days 35-37 of pregnancy (page 7 of the translation) and birth occurs at day 114 (page 4 of the translation), Applicant further argues that Takizawa is directed to allotransplantation of Lnk modified cells in mice, not between different species as claimed. Thus, Applicant argues that Takizawa provides no information on the survival rate of Lnk-deficient cells in a heterologous animal or the blood chimerism in the recipient of a heterologous animal. The Examiner is not persuaded. Takizawa is a secondary reference to show that Lnk deficiency aids in HSC engraftment and survival in the recipient non-human animals. Applicant has provided no evidence that LNK deficiency would not aid in engraftment between species similarly to the way it works in the same species. At pages 6-8 of the Reply dated 5/24/2021, Applicant points to Hanzono, Zanjani, 1992, Zanjani, 1994, Abe 2011, Sauvageau, 1995 and Klump 2001 to show “known” methods of xenotransplantation or allotransplantation, including as a result of HOXB-4 overexpression, between human and large domestic animals, or between the same species, and argues the resulting blood chimerism is very low, and that the methods encompassed by the instant claims results in a much longer survival of blood chimerism. The Examiner is not convinced of error. Initially, it is noted that the instant claims do not require that the transplanted donor cells survive for any specific amount of time, nor do the instant claims require any specific amount of donor cell survival or engraftment. Thus, while all of Hanzono, Zanjani, 1992, Zanjani, 1994, Abe 2011, Sauvageau, 1995 and Klump 2001 may show little survival of donor cells, or for a short amount of time, the cited references none-the-less teach that donor cells survive to some extent, or for some amount of time – via either xenotransplantation or allogenic transplantation. More specifically, Applicant argues that Abe, 2011 shows xenotransplantation of transplanted human donor hematopoietic cells, comprising over-expression of HOXB4, in into fetal sheep shows survival rate of cells for at least 5 months, but that the survival rate was only 3-4%. Applicant also argues that Sauvageau, 1995, and Klump 2001 disclose allogenic transplantation of murine Thus, in light of the differences between Abe, 2001 (using methods of xenotransplantation of HoxB4 over-expression in donor cells) which allegedly show improvement of increased survival length, but low survival percentages of donor cells, and Sauvageau, 1995 and Klump 2001 (using methods of allotransplantation of HoxB4 over-expression in donor cells) which allegedly show improvement of increased survival and increased survival rates, Applicant argues, at page 8, that even though Lnk gene inhibition was known to improve survival of donor hematopoietic cells in recipients of the same species, “one skilled in the art could not have reasonably expected that the survival of hematopoietic cells and the chimerism in peripheral blood could be improved in the case of xenogeneic hematopoietic cell transplantation.” The Examiner is not convinced of error. The instant claims do not require any amount of transplanted donor cells survive over any amount of time. The only requirement is that “some” survive and are retained in the peripheral blood. And, as shown by Abe, 2001, HOXB4 overexpression increases xenograft cell survival in methods of xenotransplantation, as acknowledged by Applicant. Applicant further points to results of the instant application at paragraphs [0069]-[0072] and FIGs 1B, and Fig 2, where 1) all four of the surviving recipient offspring of xenotransplantation retained nucleated donor cells in their circulating blood and 2) 11.42 – 20.52 % of the total nucleated blood cells in the circulating blood cells at 16 months were derived from donor cells, and argues such improved results were unexpected from the teaching of Nakauchi, and were not predictable from the cited art, either alone or in combination. The Examiner is not convinced of error. In submitting evidence asserted to establish unobvious results, there is a burden on an applicant to indicate how the examples asserted to represent the claimed invention are considered to relate to the examples intended to represent the prior art and, particularly, to indicate how those latter examples do represent the closest prior art. The evidence relied
Conclusion No claims are allowed. NO claims are free of the prior art.
Any inquiry concerning this communication or earlier communications from the examiner should be directed to KIMBERLY A ARON whose telephone number is (571)272-2789. The examiner can normally be reached on Monday-Friday 9AM-5PM.
If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Christopher Babic can be reached on 571-272-8507. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
KAA
/JAMES D SCHULTZ/Primary Examiner, Art Unit 1633 | 2021-10-05T04:30:55 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Continued Examination Under 37 CFR 1.114 A request for continued examination under 37 CFR 1.114, including the fee set forth in 37 CFR 1.17(e), was filed in this application after final rejection. Since this application is eligible for continued examination under 37 CFR 1.114, and the fee set forth in 37 CFR 1.17(e) has been timely paid, the finality of the previous Office action has been withdrawn pursuant to 37 CFR 1.114. Applicant's submission filed on 5/24/21 has been entered. Applicant’s amendments to the claims dated 5/24/21 are acknowledged.",
"Claims 1-11 and 14-15 are pending. Claims 12-13 are cancelled with the amendment of 5/24/21. Claim 8 is amended. Claims 1-7 and 15 are withdrawn. Claims 8-11 and 14 are subject to prosecution. Applicant’s supplemental amendment to the claims dated 5/26/21 are acknowledged. Claims 1-11 and 14-15 are pending. Claim 8 is amended. Claims 1-7 and 15 are withdrawn. Claims 8-11 and 14 are subject to prosecution. WITHDRAWN REJECTIONS Any rejection not reiterated herein is WITHDRAWN in light of Applicant’s amendments to the claims.",
"RESPONSE TO ARGUMENTS Applicant’s arguments with regard to a withdrawn rejection is moot. A response to any argument pertinent to a maintained or modified rejection of record can be found below. The instant Application, filed 12/21/17 is a 371 National Stage Application of PCT/JP2016/068233, filed 06/20/2016, which claims priority to JP2015124569, filed 6/22/2015. A certified copy of the foreign priority document JP2015124569 (in Japanese) has been submitted in the instant Application. Thus, the earliest possible priority date for the instant Application is 06/22/2015. CLAIMS Claims 8-11 and 14, as amended (showing changes from both the 5/24/21 AND 5/26/21 amendments), are drawn to, “A non-human animal that retains blood cells originating in a heterologous animal, in which the hematopoietic cells originating in the heterologous animal survive, said hematopoietic cells being cells in which a function of [[a]] LNK gene inhibited The claims read on a non-human animal comprising transplanted/engrafted heterologous genetically modified hematopoietic cells, wherein the non-human animal comprises blood cells from the engrafted heterologous modified hematopoietic cells, wherein the genetic modification is wherein “a function of LNK gene is inhibited.” The claims encompass transplantation between the same species (mouse to mouse, for example) or between different species (human to mouse, for example).",
"The claims have been amended to delete the requirement that the recipient animal is “not an immunodeficient animal”. The claims have also been amended to require that any function of the LNK gene is inhibited in the cells. MAINTAINED REJECTIONS Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains.",
"Patentability shall not be negated by the manner in which the invention was made. The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. Claims 8-11 and 14 remain rejected under 35 U.S.C. 103 as being unpatentable over WO 01/58255 to Nakauchi, of record, cited on Applicant’s IDS dated 3/31/2020, further in view of Takizawa et al. Enhanced Engraftment of Hematopoietic Stem/Progenitor Cells by the Transient Inhibition of an Adaptor Protein, Lnk.",
"Blood, 2006. 107(7):2968-2975, of record, cited on Applicant’s IDS dated 4/9/18. A machine translation of WO 01/58255 to Nakauchi is provided herewith, as the citation of WO 01/58255 to Nakauchi on the IDS is in Japanese with only an English Abstract. This rejection is modified in response to Applicant’s amendments to the claims. With regard to claim 8, Nakauchi discloses generating chimeric non-human animals comprising engrafted human hematopoietic stem cells, wherein the human hematopoietic stem cells are engrafted into the non-human animal fetal liver, and wherein the non-human animal continues to retain human Thus, Nakauchi discloses “A non-human animal that retains blood cells originating in a heterologous animal, in which the hematopoietic cells originating in the heterologous animal survive, and which retains the blood cells originating in the heterologous animal in the circulating blood, wherein the heterologous animal is of a species different from the non-human animal.” However, Nakauchi does not disclose wherein the engrafted hematopoietic cells are modified such that a function of LNK gene is inhibited, as required by instant claim 8. Takizawa discloses Lnk inhibition of donor hematopoietic stem cells increases their ability to be engrafted into recipient donor animals (Abstract, FIG 4C, page 2973). Takizawa discloses the donor hematopoietic stem cells with Lnk inhibition are modified to reduce Lnk Function, which Takizawa discloses likely results in increased proliferation through augmented cytokine receptor signaling, which results in increased donor HSC engraftment and survival (page 2973-2974). It would have been obvious to modify the cells of Nakauchi further with the disclosure of Takizawa.",
"A skilled artisan would have been motivated to modify the human hematopoietic cells of Nakauchi to inhibit Lnk function according to Takizawa, because Takizawa discloses inhibition of Lnk increases HSC engraftment and survival in the recipient non-human animals. A skilled artisan would have had a reasonable expectation of success in practicing the claimed invention as modifying donor HSC to improve engraftment in a recipient non-human animal was known in the art at the time of the invention. With regard to claims 9-10, Nakauchi discloses the non-human animal is a pig (see, pages 2-5, including “Human Hematopoietic Stem Cell Transplantation into Porcine Fetuses” section of translation). With regard to claim 11, Nakauchi discloses the heterologous animal (donor) is a human, which reads on a mammal (see, pages 2-5, including “Human Hematopoietic Stem Cell Transplantation into Porcine Fetuses” section of translation).",
"With regard to claim 14, Nakauchi discloses the donor cells are hematopoietic stem cells (see, pages 2-5, including “Human Hematopoietic Stem Cell Transplantation into Porcine Fetuses” section of translation). RESPONSE TO ARGUMENTS Applicant’s arguments filed 5/24/2021 have been considered but are not persuasive. With regard to the 103 rejection in light of Nakauchi in view of Takizawa, Applicant argues the blood chimerism in the pigs at birth of Nakauchi is low, and the period of donor cell survival was as short as 38 days, pointing to animal D3585 therein, pointing to Table 2. Applicant also points to pigs W1048 and W549 who show FACs-detectable chimerism in bone marrow, but chimerism was low (0.04 and 0.58%), and that Nakauchi does not actually show chimerism in the peripheral blood. Thus, Applicant argues that the pigs of Nakauchi cannot be considered to retain human cells in the peripheral blood. The Examiner disagrees. Initially, the instant claims do not exclude fetal animals, nor only comprise animals surviving after birth, and if so, for how long.",
"Regardless, Nakauchi shows the human donor cells are capable of survival for at least three months after transplantation in fetuses (see page 5 of translation, under “MEASUREMENT OF COLONY FORMING ABILITY OF HUMAN HEMATOPOIETIC STEM CELSS PRESENT IN PIG FETUSES” section). Further, D3735 of Table 2 shows presence of human CD34 cells in the PBL (peripheral blood) for 103 days after transplantation. Given transplantation occurred between days 35-37 of pregnancy (page 7 of the translation) and birth occurs at day 114 (page 4 of the translation), Applicant further argues that Takizawa is directed to allotransplantation of Lnk modified cells in mice, not between different species as claimed. Thus, Applicant argues that Takizawa provides no information on the survival rate of Lnk-deficient cells in a heterologous animal or the blood chimerism in the recipient of a heterologous animal. The Examiner is not persuaded.",
"Takizawa is a secondary reference to show that Lnk deficiency aids in HSC engraftment and survival in the recipient non-human animals. Applicant has provided no evidence that LNK deficiency would not aid in engraftment between species similarly to the way it works in the same species. At pages 6-8 of the Reply dated 5/24/2021, Applicant points to Hanzono, Zanjani, 1992, Zanjani, 1994, Abe 2011, Sauvageau, 1995 and Klump 2001 to show “known” methods of xenotransplantation or allotransplantation, including as a result of HOXB-4 overexpression, between human and large domestic animals, or between the same species, and argues the resulting blood chimerism is very low, and that the methods encompassed by the instant claims results in a much longer survival of blood chimerism. The Examiner is not convinced of error. Initially, it is noted that the instant claims do not require that the transplanted donor cells survive for any specific amount of time, nor do the instant claims require any specific amount of donor cell survival or engraftment. Thus, while all of Hanzono, Zanjani, 1992, Zanjani, 1994, Abe 2011, Sauvageau, 1995 and Klump 2001 may show little survival of donor cells, or for a short amount of time, the cited references none-the-less teach that donor cells survive to some extent, or for some amount of time – via either xenotransplantation or allogenic transplantation.",
"More specifically, Applicant argues that Abe, 2011 shows xenotransplantation of transplanted human donor hematopoietic cells, comprising over-expression of HOXB4, in into fetal sheep shows survival rate of cells for at least 5 months, but that the survival rate was only 3-4%. Applicant also argues that Sauvageau, 1995, and Klump 2001 disclose allogenic transplantation of murine Thus, in light of the differences between Abe, 2001 (using methods of xenotransplantation of HoxB4 over-expression in donor cells) which allegedly show improvement of increased survival length, but low survival percentages of donor cells, and Sauvageau, 1995 and Klump 2001 (using methods of allotransplantation of HoxB4 over-expression in donor cells) which allegedly show improvement of increased survival and increased survival rates, Applicant argues, at page 8, that even though Lnk gene inhibition was known to improve survival of donor hematopoietic cells in recipients of the same species, “one skilled in the art could not have reasonably expected that the survival of hematopoietic cells and the chimerism in peripheral blood could be improved in the case of xenogeneic hematopoietic cell transplantation.” The Examiner is not convinced of error.",
"The instant claims do not require any amount of transplanted donor cells survive over any amount of time. The only requirement is that “some” survive and are retained in the peripheral blood. And, as shown by Abe, 2001, HOXB4 overexpression increases xenograft cell survival in methods of xenotransplantation, as acknowledged by Applicant. Applicant further points to results of the instant application at paragraphs [0069]-[0072] and FIGs 1B, and Fig 2, where 1) all four of the surviving recipient offspring of xenotransplantation retained nucleated donor cells in their circulating blood and 2) 11.42 – 20.52 % of the total nucleated blood cells in the circulating blood cells at 16 months were derived from donor cells, and argues such improved results were unexpected from the teaching of Nakauchi, and were not predictable from the cited art, either alone or in combination. The Examiner is not convinced of error.",
"In submitting evidence asserted to establish unobvious results, there is a burden on an applicant to indicate how the examples asserted to represent the claimed invention are considered to relate to the examples intended to represent the prior art and, particularly, to indicate how those latter examples do represent the closest prior art. The evidence relied Conclusion No claims are allowed. NO claims are free of the prior art. Any inquiry concerning this communication or earlier communications from the examiner should be directed to KIMBERLY A ARON whose telephone number is (571)272-2789. The examiner can normally be reached on Monday-Friday 9AM-5PM. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Christopher Babic can be reached on 571-272-8507.",
"The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. KAA /JAMES D SCHULTZ/Primary Examiner, Art Unit 1633"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-09-19.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
723 S.W.2d 727 (1986) Mark Rodney FREEMAN, Appellant, v. The STATE of Texas, Appellee. No. 632-85. Court of Criminal Appeals of Texas, En Banc. November 26, 1986. Arch C. McColl, III, S. Michael McColloch, David W. Coody, on appeal only, Dallas, for appellant. Henry Wade, Dist. Atty., Anne B. Wetherholt, Julius Whittier and Terrance Hart, Asst. Dist. Attys., Dallas, Robert Huttash, State's Atty., Austin, for the State. Before the court en banc. OPINION ON APPELLANT'S PETITION FOR DISCRETIONARY REVIEW W.C. DAVIS, Judge. A jury convicted appellant of murder and assessed his punishment at fifty years' confinement. The Eastland Court of Appeals affirmed the conviction, holding that appellant's confession was not involuntary because the "promise" he received from police was not conditioned on his giving a confession. The Court of Appeals also *728 found that appellant knowingly and intelligently waived his right to have counsel present during the questioning which resulted in his confession. Freeman v. State, 691 S.W.2d 739 (Tex.App.Eastland 1985). We granted appellant's petition for discretionary review to consider both issues. The trial court conducted a pretrial hearing to determine the issue of the voluntariness of appellant's confession. The trial court found that appellant was properly informed of his rights, that no promise or threat was made to appellant, and that appellant freely and voluntarily confessed. Steven Waddell was murdered by appellant, acting with Waddell's wife, on April 17, 1983, at a Sonic Drive-In in Grand Prairie. Appellant fled to Pulaski, Tennessee, where he was arrested on April 20, 1983. He was arraigned and an attorney was appointed for him. Harroll Lynn Rhoads, an investigator with the Grand Prairie Police Department went to Pulaski on April 21, to speak with appellant. Rhoads testified that he met with Investigator Richard Jernigan, a member of the Sheriff's Department in Pulaski, and then spoke to appellant at about 6:15 p.m. on April 21. Rhoads informed appellant of his rights. Appellant told him he understood his rights and that he had an attorney. Rhoads explained to appellant that he was investigating Waddell's murder and he knew what had taken place during the offense, including the fact that Waddell had not died right after he was shot. He also told appellant that Waddell's wife had given statements and he asked appellant if he would like to talk about the offense. Rhoads testified that appellant reiterated several times that, although he wanted to talk about the offense, he was too young to die and did not want to get the death penalty. Rhoads showed appellant the murder statute and the capital murder statute in the Texas Penal Code. He read both statutes and explained the differences to appellant. Rhoads testified that when he talked to appellant, based on what he knew about the case, he considered it a murder case not a capital murder case. Appellant then told Rhoads he would like to talk to him but that he wanted to see his attorney. At that point appellant's attorney, Tom Stack, was contacted. He arrived at the Sheriff's office at about 7:30 p.m. to talk with appellant. Appellant and his attorney conferred for a while, after which Stack asked to speak with Rhoads. Rhoads told him what he knew about the offense and Stack indicated he knew what Rhoads was talking about. Rhoads testified Stack indicated that appellant wanted to talk about the offense but was afraid he would get the death penalty. Rhoads also testified Stack stated that if he could be sure that the police would not file a capital murder case on appellant they could talk about whether or not appellant would make a statement.[1] Rhoads told Stack he had to talk to his department in Grand Prairie about the matter. Stack said he would like to talk to the District Attorney in Dallas County the next morning and that they could then talk about the statement. Stack also told Rhoads that he had told appellant not to talk to the officers. Rhoads immediately called Sergeant Dale Phifer of the Grand Prairie Police Department and explained the situation. Phifer told him he would confer with the legal advisors and call Rhoads back. Phifer spoke to Norman Kinne, an assistant district attorney for Dallas County, who told him that based upon the evidence the police related to him, including a statement from Waddell's wife, legally the cases were not capital murders and would not be accepted as such by the district attorney's office.[2]*729 Phifer called Rhoads back that same evening and told him it was okay to tell appellant that the police would not file capital murder charges if appellant was the one who had initiated the subject. Just after Rhoads finished with the phone calls, Jernigan came to Rhoads and said appellant wanted to talk to him. Jernigan brought appellant into the room and Rhoads asked him if he wanted to talk about the offense. Appellant said he did, but that he still had some reservations about the death penalty. Rhoads asked him if he would feel better about it if Rhoads stated in writing that a murder charge would be filed and that a capital offense would not be filed against appellant. Appellant said he would feel better if that were done. Rhoads then executed an affidavit stating that appellant would not be charged with capital murder. Rhoads testified he hoped that his written affidavit would lead appellant to confess, but that he had no assurance of that. He simply told appellant that he would not be charged with capital murder in response to appellant's concern about the matter. Rhoads also said he repeatedly told appellant that he could have his attorney with him or that he could waive counsel. Appellant indicated he would waive having his attorney present. Appellant then gave a confession admitting his part in killing Waddell. Rhoads testified that no promises were given to appellant in exchange for his confession and that no bargain was made. Rhoads hoped that assuring appellant that he would not be charged with capital murder would ease appellant's mind so that he would confess. No "bargain" was made. The "promise" not to charge appellant with capital murder was simply an assurance to appellant that under the law and the evidence he would not be charged with capital murder. Appellant's version of the events leading up to his confession is, not surprisingly, contrary to Rhoads' rendition. Appellant testified that after he conferred with his attorney, Stack told Rhoads that appellant was not going to make a statement and that if he still wanted to make a deal Stack would be back in the morning and would call the district attorney. Appellant also said that after his attorney left Rhoads told appellant that he was leaving the next morning and was going to file capital murder charges and that appellant would not have a choice about it. Appellant said Rhoads called the District Attorney's office while appellant was present and then told appellant he would make an agreement with him. Appellant said the agreement was that he would not be charged with capital murder and in return he would make a statement. Appellant also said he requested that his lawyer be present. The trial court is the sole judge of the credibility of the witnesses in a pretrial hearing and absent a showing of an abuse of discretion, the trial court's findings will not be disturbed. Hawkins v. State, 613 S.W.2d 720 (Tex.Cr.App.1981); McMahon v. State, 582 S.W.2d 786 (Tex.Cr.App.1979). Obviously, the trial court chose to disbelieve appellant's version of the circumstances surrounding the confession. We find nothing in the record to show an abuse of discretion and we likewise reject appellant's version. Appellant contends that his statement was inadmissible under the long established rule that: A confession obtained as a result of a benefit positively being promised to the defendant made or sanctioned by one in authority and of such character as would be likely to influence a defendant to speak untruthfully is not admissible. Walker v. State, 626 S.W.2d 777, 778 (Tex. Cr.App.1982). See also Hardesty v. State, 667 S.W.2d 130 (Tex.Cr.App.1984); Hawkins v. State, 613 S.W.2d 720 (Tex.Cr.App. 1981); Washington v. State, 582 S.W.2d 122 (Tex.Cr.App.1979); Fisher v. State, 379 S.W.2d 900 (Tex.Cr.App.1964); Searcy v. State, 28 White & W. 513, 13 S.W. 782 (1890). The Court of Appeals held that in order to render a confession involuntary the promised benefit to the accused must be a benefit offered in exchange for a statement *730 from the accused. The Court of Appeals noted that the aforementioned cases have all involved conditional promises from the State to the accused whereby the State promises a benefit only "if" the accused gives a statement. In the instant case the "promise" was unconditional. Appellant was told that he would not be charged with capital murder. While Rhoads hoped this would ease appellant's mind so that he would confess, it was not contingent on appellant making a statement. Thus, the Court of Appeals found that no "deal" or "agreement" was made because the assurance not to file a capital murder charge was unconditional. Appellant argues that his statement was induced by the promise of a benefitno capital murder chargeand was therefore involuntary under Texas law and constitutional law. We disagree with appellant. Appellant is correct that a statement induced by a promise of some benefit to a defendant, which promise is positive, made or sanctioned by one in authority, and likely to influence the defendant to speak untruthfully is involuntary. Fisher, supra. The rationale for this rule is the inherent unreliability of a confession if the influence applied was such as to make the defendant believe his condition would be bettered by making a confession, true or false. Searcy, supra. However, the State is correct that this four part test does not apply in the instant case because no "promise of some benefit" to appellant was ever made. In the instant case appellant himself stated repeatedly to the police that he wanted to talk to them, but, he was fearful of the death penalty. In response to this anxiety, Rhoads checked with legal advisors, including the district attorney's office and then told appellant he would not be charged with capital murder. This was not a promise of a benefit in the sense that appellant was promised something he would not otherwise have had. Rather, it was an answer to relieve appellant's anxiety and a statement of the status of the case in terms of the facts and law. The police did not coerce appellant by suggesting or expressly stating that if he would confess they would reduce the charge. Nor did they threaten explicitly or implicitly that he would be charged with capital murder if he did not make a statement. Appellant himself initiated the discussion, essentially telling Rhoads that he wanted to confess but he wanted to know the ramifications of such, in terms of punishment. Although appellant may have decided not to confess if he was to be charged with capital murder, the decision not to charge him with capital murder was not made in response to appellant's wishes or to accomodate appellant, but was a choice made by the district attorney after considering the evidence the police had. Thus, legally, appellant was not and could not be charged with capital murder. Just because this served to relieve appellant's concern and "ease his mind" does not render the subsequent confession involuntary nor render the information a "promise of some benefit" to appellant. The instant case is analogous to Roberts v. State, 545 S.W.2d 157 (Tex.Cr.App.1977) and Hawkins, supra. In Roberts the defendant contended that his confession was involuntarily given in return for his wife's release from custody. The defendant and his wife were arrested while in their car when police saw someone hand a package of heroin to the defendant, the driver of the car. The defendant insisted to police that his wife did not know anything about the drugs and had nothing to do with it. The officer asked the defendant if he would make a statement to that effect. The defendant agreed. This Court held the confession to be voluntary, stating that the police officer had a duty to determine whether or not there was evidence to hold or release the defendant's wife. And, "it was the appellant, who first said the appellant's wife was innocent and initially introduced the subject of leniency for his wife. The trial court could well conclude that the statement was self-motivated and voluntarily made by the appellant because he wanted his innocent wife who was under suspicion *731 freed ..." Roberts, 545 S.W.2d at 161. In the instant case appellant's statement was self-motivated and voluntarily made after appellant's anxiety about the death penalty was shown to be groundless. Likewise, Hawkins, supra, is analogous to the instant case. The defendant Hawkins first introduced to the police a long history of his abnormal behavior. The officers "professed understanding and empathy ... not to promise anything but to get to the point of the interrogation." This sympathy and willingness to help the defendant was not found to be a promise which induced the defendant's confession. In the same way, Rhoads' inquiry into the status of the offense as a capital offense or "only" a murder offense was not a promise to induce a confession. The easing of appellant's mind by checking out the legal status of his case is somewhat analogous to the empathy and willingness to help related in Hawkins, supra. This case is not like those where the police promise not to seek the death penalty if the defendant gives a statement. That situation is clearly improper and renders a confession involuntary. Cf. McMahon, supra; and Sherman v. State, 532 S.W.2d 634 (Tex.Cr.App.1976). Nor is the instant case similar to a case in which the State offers to reduce the charge if the defendant gives a statement. See W. Ringel, Searches & Seizures, Arrests and Confessions, § 25.2(c) (1984). No "promise" is made when a defendant expresses a fear of prosecution for some offense for which he actually cannot be prosecuted and the State explains that he cannot be prosecuted for the feared offense, and the defendant then confesses. Just because a defendant thinks he has benefitted because his anxiety is quelled does not reflect a promise of some benefit from the State. The benefit lay in the facts of the case not in the actions of the police. The fact that he need not have worried about the death penalty and that the police allayed that worry, without any deal, bargain, agreement, or exchange does not render the confession involuntary. Further, from the record before us it does not appear that the police pretended that they could charge appellant with capital murder and agreed that if he would confess, would not so charge him. This would be a different case. Rhoads' affidavit assuring appellant that he would not be charged with capital murder was not contingent on a confession. Thus, not only was a promise of some benefit not bestowed upon appellant by the State, but there was no "deal" or "bargain" or "contingency" involved. Under the constitutional standardthe totality of the circumstancesappellant's confession was freely and voluntarily given. The totality of the circumstances show that appellant was informed of his rights numerous times and that he conferred with his attorney immediately prior to making a statement. Appellant told the police and indicated to his attorney that he wanted to confess. Once his fears about the death penalty were erased, appellant did confess. The circumstances show that appellant voluntarily and freely confessed. The ground of error is overruled. Appellant next contends that his confession was taken in violation of the rule set out in Edwards v. Arizona, 451 U.S. 477, 101 S. Ct. 1880, 68 L. Ed. 2d 378 (1981) because the police initiated the conversation with him that led to his confession after he had invoked his right to counsel. The Court of Appeals held that appellant had initiated the conversation which resulted in his confession. Rhoads testified that when he arrived in Pulaski he met with appellant, informed him of his rights, told him not to say anything, and to listen while Rhoads told him what the police knew about the offense. Rhoads asked appellant if he wanted to talk and appellant indicated he would like to talk to Rhoads but that he was concerned about the death penalty and first wanted to speak with his attorney. After appellant spoke with his attorney in a room in the kitchen area of the sheriff's office, he remained there while his attorney talked to Rhoads. Jernigan went into the kitchen, *732 fixed himself a cup of coffee and asked appellant if he wanted one. The two of them started talking. Jernigan testified that he did not remember what they talked about except that they talked about "various things, not the case, justwe were just talking," being friendly. During their conversation Jernigan asked appellant if he was hungry and appellant told him he was, but that he had been unable to eat or sleep since "it happened." Appellant said "I've got to talk about this thing. I've got to get it off my chest. I can't eat or sleep." Jernigan testified that appellant also told him that "he had tried to explain to his attorney that he wanted to talk about it and that he knew he would have to go back to Texas and get it worked out and that the attorney had not listened to him and that he couldn't go any longer, he had to get something to eat and some sleep, some rest." At this point Jernigan left the kitchen and told Rhoads that appellant wanted to talk to him. Jernigan brought appellant into his office and Rhoads asked him if he wanted to talk to him. Appellant said "Yes, but I'm still afraid. I'm too young to die." Jernigan testified that Rhoads "very carefully" went over appellant's right to have his attorney present. He asked appellant if he wanted them to call Stack back or whether he wanted to go on without him. Appellant said he wanted to talk to Rhoads about it. Several more times Rhoads stated to appellant that he could have his attorney with him, but appellant indicated he wished to talk to Rhoads. Rhoads then gave appellant a written statement that he would not be charged with capital murder. Appellant and Rhoads talked and appellant confessed to his part in the murder. Once a defendant invokes his right to counsel, he may not be subjected to further interrogation until counsel is present, unless the defendant himself initiates dialogue with the authorities. Edwards v. Arizona, supra. Where reinterrogation follows such initiation by a defendant, the State still has a "heavy burden" to show that a defendant's waiver of his right to counsel during interrogation was knowing and intelligent. Oregon v. Bradshaw, 462 U.S. 1039, 103 S. Ct. 2830, 77 L. Ed. 2d 405 (1983); Edwards v. Arizona, supra; Wilkerson v. State, 657 S.W.2d 784 (Tex. Cr.App.1983). Appellant contends that Jernigan initiated the conversation in the kitchen and thus violated his previously invoked right to counsel. Jernigan stated that he simply asked appellant if he wanted a cup of coffee and they had a friendly conversation. The State argues that appellant initiated further interrogation about the offense by his response to Jernigan's innocuous inquiry about whether he was hungry. The rule set out in Edwards v. Arizona, supra, does not forbid all conversation between police and an accused. As the Supreme Court noted in Oregon v. Bradshaw, 462 U.S. at 1045, 103 S. Ct. at 2835, it is doubtful "that it would be desirable to build a superstructure of legal refinements around the word `initiate' in this context, [and] there are undoubtedly situations where a bare inquiry by either a defendant or by police officer should not be held to `initiate' any conversation or dialogue." The rule "is designed to protect an accused in police custody from being badgered by police officers in the manner in which the defendant in Edwards was." Oregon v. Bradshaw, 462 U.S. at 1044, 103 S. Ct. at 2834. In the instant case the record of the pretrial hearing shows that Jernigan's conversation with appellant, begun by asking if appellant wanted something to drink, was simply a "friendly conversation" that had nothing to do with the case. The conversation was not an effort to elicit a statement, confession, or incriminating information from appellant. It was not an attempt at subtle interrogation designed to coerce appellant into confessing. Cf. Brewer v. Williams, 430 U.S. 387, 97 S. Ct. 1232, 51 L. Ed. 2d 424 (1977); Bush v. State, 697 S.W.2d 397 (Tex.Cr.App.1985). Neither the rule nor the rationale of Edwards v. Arizona, supra, was violated by Jernigan's conversation with appellant in the kitchen of the Sheriff's office. The conversation is *733 analogous to the "bare inquiry" type of dialogue noted in Oregon v. Bradshaw, supra, which are "routine incidents of the custodial relationship" and which do not constitute "initiation" in the sense forbidden in Edwards v. Arizona, supra. While it was more detailed than a "bare inquiry," the gist of the conversation was the same. The spirit and rule of Edwards v. Arizona, supra, certainly does not require absolute silence between an accused and the police, once the accused has invoked his right to counsel. Jernigan knew appellant and a "friendly conversation", small talk, including inquiries about thirst and hunger, does not constitute "initiation" of interrogation as forbidden by Edwards v. Arizona, supra. The "initiation" of communication about the offense came from appellant in his response to Jernigan's question about whether he was hungry. Jernigan, naturally interpreting appellant's response to indicate a desire to talk, promptly told Rhoads. Rhoads checked with appellant to be certain he wanted to talk and that he did not want his counsel present. Appellant said he wanted to talk and waived his right to counsel. The record of the particular facts and circumstances of this case thus shows that appellant initiated the reinterrogation about the offense. Also, appellant had just spoken with his attorney before talking to Jernigan and Rhoads and he was informed of his rights on numerous occasions. We hold that the record also shows that appellant knowingly and intelligently waived his right to counsel. Appellant contends that his testimony at the pretrial hearing is undisputed and reflects a situation analogous to Bush, supra, in that subtle interrogation and coercion was employed by Jernigan. Appellant testified that Jernigan and he sat in the kitchen drinking coffee and Jernigan told him a story about "I don't know, some guy blowing his head off over a crime, and he left a note about the guilt being too much for him and everything like that; and he was saying that, you know, if I'd go ahead andyou know, with the evidence they've got they could convict me, and if I go ahead and make a statement to him it would go easier on me and everything like that." Appellant also testified that Rhoads then came into the kitchen and told appellant that he, Rhoads, was leaving the next morning and appellant had a choice of making a statement that night or in the morning, but that if he did not make a statement Rhoads would file a capital murder charge. Appellant also said he repeatedly asked that his attorney be present. Jernigan was not recalled to testify about whether or not he told appellant a story about someone committing suicide over a crime about which he felt guilty. Appellant was not asked whether he told Jernigan he wanted to talk about it, to "get it off his chest." If appellant's version is believed the confession is involuntary and his right to counsel was blatantly violated. The trial court obviously rejected appellant's testimony by finding the confession to have been voluntarily and freely made. The trial court is the sole judge of the credibility of the witnesses in a pretrial hearing. Absent a showing of an abuse of discretion the trial court's findings will not be disturbed. Hawkins, supra. The ground of error is overruled. The judgment of the Court of Appeals affirming the trial court is likewise affirmed. TOM G. DAVIS, J. concurs in the result. ONION, P.J., and CLINTON and TEAGUE, JJ., dissent. NOTES [1] Appellant was from Tennessee. Under Tennessee law the offense of murder was punishable by death. This might explain appellant's concern about the death penalty. [2] The case was not a capital murder case because appellant, who was apparently having an affair with Waddell's wife, murdered Waddell and then committed robbery only to disguise his motive and hopefully his identity in committing the murder. See V.T.C.A. Penal Code, Sec. 19.03(a)(2). | 10-30-2013 | [
"723 S.W.2d 727 (1986) Mark Rodney FREEMAN, Appellant, v. The STATE of Texas, Appellee. No. 632-85. Court of Criminal Appeals of Texas, En Banc. November 26, 1986. Arch C. McColl, III, S. Michael McColloch, David W. Coody, on appeal only, Dallas, for appellant. Henry Wade, Dist. Atty., Anne B. Wetherholt, Julius Whittier and Terrance Hart, Asst. Dist. Attys., Dallas, Robert Huttash, State's Atty., Austin, for the State. Before the court en banc. OPINION ON APPELLANT'S PETITION FOR DISCRETIONARY REVIEW W.C. DAVIS, Judge. A jury convicted appellant of murder and assessed his punishment at fifty years' confinement. The Eastland Court of Appeals affirmed the conviction, holding that appellant's confession was not involuntary because the \"promise\" he received from police was not conditioned on his giving a confession. The Court of Appeals also *728 found that appellant knowingly and intelligently waived his right to have counsel present during the questioning which resulted in his confession.",
"Freeman v. State, 691 S.W.2d 739 (Tex.App.Eastland 1985). We granted appellant's petition for discretionary review to consider both issues. The trial court conducted a pretrial hearing to determine the issue of the voluntariness of appellant's confession. The trial court found that appellant was properly informed of his rights, that no promise or threat was made to appellant, and that appellant freely and voluntarily confessed. Steven Waddell was murdered by appellant, acting with Waddell's wife, on April 17, 1983, at a Sonic Drive-In in Grand Prairie. Appellant fled to Pulaski, Tennessee, where he was arrested on April 20, 1983.",
"He was arraigned and an attorney was appointed for him. Harroll Lynn Rhoads, an investigator with the Grand Prairie Police Department went to Pulaski on April 21, to speak with appellant. Rhoads testified that he met with Investigator Richard Jernigan, a member of the Sheriff's Department in Pulaski, and then spoke to appellant at about 6:15 p.m. on April 21. Rhoads informed appellant of his rights. Appellant told him he understood his rights and that he had an attorney. Rhoads explained to appellant that he was investigating Waddell's murder and he knew what had taken place during the offense, including the fact that Waddell had not died right after he was shot. He also told appellant that Waddell's wife had given statements and he asked appellant if he would like to talk about the offense. Rhoads testified that appellant reiterated several times that, although he wanted to talk about the offense, he was too young to die and did not want to get the death penalty. Rhoads showed appellant the murder statute and the capital murder statute in the Texas Penal Code. He read both statutes and explained the differences to appellant.",
"Rhoads testified that when he talked to appellant, based on what he knew about the case, he considered it a murder case not a capital murder case. Appellant then told Rhoads he would like to talk to him but that he wanted to see his attorney. At that point appellant's attorney, Tom Stack, was contacted. He arrived at the Sheriff's office at about 7:30 p.m. to talk with appellant. Appellant and his attorney conferred for a while, after which Stack asked to speak with Rhoads.",
"Rhoads told him what he knew about the offense and Stack indicated he knew what Rhoads was talking about. Rhoads testified Stack indicated that appellant wanted to talk about the offense but was afraid he would get the death penalty. Rhoads also testified Stack stated that if he could be sure that the police would not file a capital murder case on appellant they could talk about whether or not appellant would make a statement. [1] Rhoads told Stack he had to talk to his department in Grand Prairie about the matter. Stack said he would like to talk to the District Attorney in Dallas County the next morning and that they could then talk about the statement. Stack also told Rhoads that he had told appellant not to talk to the officers. Rhoads immediately called Sergeant Dale Phifer of the Grand Prairie Police Department and explained the situation.",
"Phifer told him he would confer with the legal advisors and call Rhoads back. Phifer spoke to Norman Kinne, an assistant district attorney for Dallas County, who told him that based upon the evidence the police related to him, including a statement from Waddell's wife, legally the cases were not capital murders and would not be accepted as such by the district attorney's office. [2]*729 Phifer called Rhoads back that same evening and told him it was okay to tell appellant that the police would not file capital murder charges if appellant was the one who had initiated the subject. Just after Rhoads finished with the phone calls, Jernigan came to Rhoads and said appellant wanted to talk to him. Jernigan brought appellant into the room and Rhoads asked him if he wanted to talk about the offense.",
"Appellant said he did, but that he still had some reservations about the death penalty. Rhoads asked him if he would feel better about it if Rhoads stated in writing that a murder charge would be filed and that a capital offense would not be filed against appellant. Appellant said he would feel better if that were done. Rhoads then executed an affidavit stating that appellant would not be charged with capital murder. Rhoads testified he hoped that his written affidavit would lead appellant to confess, but that he had no assurance of that. He simply told appellant that he would not be charged with capital murder in response to appellant's concern about the matter. Rhoads also said he repeatedly told appellant that he could have his attorney with him or that he could waive counsel.",
"Appellant indicated he would waive having his attorney present. Appellant then gave a confession admitting his part in killing Waddell. Rhoads testified that no promises were given to appellant in exchange for his confession and that no bargain was made. Rhoads hoped that assuring appellant that he would not be charged with capital murder would ease appellant's mind so that he would confess. No \"bargain\" was made. The \"promise\" not to charge appellant with capital murder was simply an assurance to appellant that under the law and the evidence he would not be charged with capital murder.",
"Appellant's version of the events leading up to his confession is, not surprisingly, contrary to Rhoads' rendition. Appellant testified that after he conferred with his attorney, Stack told Rhoads that appellant was not going to make a statement and that if he still wanted to make a deal Stack would be back in the morning and would call the district attorney. Appellant also said that after his attorney left Rhoads told appellant that he was leaving the next morning and was going to file capital murder charges and that appellant would not have a choice about it. Appellant said Rhoads called the District Attorney's office while appellant was present and then told appellant he would make an agreement with him.",
"Appellant said the agreement was that he would not be charged with capital murder and in return he would make a statement. Appellant also said he requested that his lawyer be present. The trial court is the sole judge of the credibility of the witnesses in a pretrial hearing and absent a showing of an abuse of discretion, the trial court's findings will not be disturbed. Hawkins v. State, 613 S.W.2d 720 (Tex.Cr.App.1981); McMahon v. State, 582 S.W.2d 786 (Tex.Cr.App.1979). Obviously, the trial court chose to disbelieve appellant's version of the circumstances surrounding the confession. We find nothing in the record to show an abuse of discretion and we likewise reject appellant's version. Appellant contends that his statement was inadmissible under the long established rule that: A confession obtained as a result of a benefit positively being promised to the defendant made or sanctioned by one in authority and of such character as would be likely to influence a defendant to speak untruthfully is not admissible.",
"Walker v. State, 626 S.W.2d 777, 778 (Tex. Cr.App.1982). See also Hardesty v. State, 667 S.W.2d 130 (Tex.Cr.App.1984); Hawkins v. State, 613 S.W.2d 720 (Tex.Cr.App. 1981); Washington v. State, 582 S.W.2d 122 (Tex.Cr.App.1979); Fisher v. State, 379 S.W.2d 900 (Tex.Cr.App.1964); Searcy v. State, 28 White & W. 513, 13 S.W. 782 (1890). The Court of Appeals held that in order to render a confession involuntary the promised benefit to the accused must be a benefit offered in exchange for a statement *730 from the accused. The Court of Appeals noted that the aforementioned cases have all involved conditional promises from the State to the accused whereby the State promises a benefit only \"if\" the accused gives a statement. In the instant case the \"promise\" was unconditional. Appellant was told that he would not be charged with capital murder. While Rhoads hoped this would ease appellant's mind so that he would confess, it was not contingent on appellant making a statement. Thus, the Court of Appeals found that no \"deal\" or \"agreement\" was made because the assurance not to file a capital murder charge was unconditional.",
"Appellant argues that his statement was induced by the promise of a benefitno capital murder chargeand was therefore involuntary under Texas law and constitutional law. We disagree with appellant. Appellant is correct that a statement induced by a promise of some benefit to a defendant, which promise is positive, made or sanctioned by one in authority, and likely to influence the defendant to speak untruthfully is involuntary. Fisher, supra. The rationale for this rule is the inherent unreliability of a confession if the influence applied was such as to make the defendant believe his condition would be bettered by making a confession, true or false. Searcy, supra.",
"However, the State is correct that this four part test does not apply in the instant case because no \"promise of some benefit\" to appellant was ever made. In the instant case appellant himself stated repeatedly to the police that he wanted to talk to them, but, he was fearful of the death penalty. In response to this anxiety, Rhoads checked with legal advisors, including the district attorney's office and then told appellant he would not be charged with capital murder. This was not a promise of a benefit in the sense that appellant was promised something he would not otherwise have had. Rather, it was an answer to relieve appellant's anxiety and a statement of the status of the case in terms of the facts and law. The police did not coerce appellant by suggesting or expressly stating that if he would confess they would reduce the charge.",
"Nor did they threaten explicitly or implicitly that he would be charged with capital murder if he did not make a statement. Appellant himself initiated the discussion, essentially telling Rhoads that he wanted to confess but he wanted to know the ramifications of such, in terms of punishment. Although appellant may have decided not to confess if he was to be charged with capital murder, the decision not to charge him with capital murder was not made in response to appellant's wishes or to accomodate appellant, but was a choice made by the district attorney after considering the evidence the police had. Thus, legally, appellant was not and could not be charged with capital murder. Just because this served to relieve appellant's concern and \"ease his mind\" does not render the subsequent confession involuntary nor render the information a \"promise of some benefit\" to appellant. The instant case is analogous to Roberts v. State, 545 S.W.2d 157 (Tex.Cr.App.1977) and Hawkins, supra.",
"In Roberts the defendant contended that his confession was involuntarily given in return for his wife's release from custody. The defendant and his wife were arrested while in their car when police saw someone hand a package of heroin to the defendant, the driver of the car. The defendant insisted to police that his wife did not know anything about the drugs and had nothing to do with it. The officer asked the defendant if he would make a statement to that effect. The defendant agreed. This Court held the confession to be voluntary, stating that the police officer had a duty to determine whether or not there was evidence to hold or release the defendant's wife.",
"And, \"it was the appellant, who first said the appellant's wife was innocent and initially introduced the subject of leniency for his wife. The trial court could well conclude that the statement was self-motivated and voluntarily made by the appellant because he wanted his innocent wife who was under suspicion *731 freed ...\" Roberts, 545 S.W.2d at 161. In the instant case appellant's statement was self-motivated and voluntarily made after appellant's anxiety about the death penalty was shown to be groundless. Likewise, Hawkins, supra, is analogous to the instant case.",
"The defendant Hawkins first introduced to the police a long history of his abnormal behavior. The officers \"professed understanding and empathy ... not to promise anything but to get to the point of the interrogation.\" This sympathy and willingness to help the defendant was not found to be a promise which induced the defendant's confession. In the same way, Rhoads' inquiry into the status of the offense as a capital offense or \"only\" a murder offense was not a promise to induce a confession. The easing of appellant's mind by checking out the legal status of his case is somewhat analogous to the empathy and willingness to help related in Hawkins, supra. This case is not like those where the police promise not to seek the death penalty if the defendant gives a statement. That situation is clearly improper and renders a confession involuntary. Cf. McMahon, supra; and Sherman v. State, 532 S.W.2d 634 (Tex.Cr.App.1976). Nor is the instant case similar to a case in which the State offers to reduce the charge if the defendant gives a statement. See W. Ringel, Searches & Seizures, Arrests and Confessions, § 25.2(c) (1984).",
"No \"promise\" is made when a defendant expresses a fear of prosecution for some offense for which he actually cannot be prosecuted and the State explains that he cannot be prosecuted for the feared offense, and the defendant then confesses. Just because a defendant thinks he has benefitted because his anxiety is quelled does not reflect a promise of some benefit from the State. The benefit lay in the facts of the case not in the actions of the police. The fact that he need not have worried about the death penalty and that the police allayed that worry, without any deal, bargain, agreement, or exchange does not render the confession involuntary. Further, from the record before us it does not appear that the police pretended that they could charge appellant with capital murder and agreed that if he would confess, would not so charge him.",
"This would be a different case. Rhoads' affidavit assuring appellant that he would not be charged with capital murder was not contingent on a confession. Thus, not only was a promise of some benefit not bestowed upon appellant by the State, but there was no \"deal\" or \"bargain\" or \"contingency\" involved. Under the constitutional standardthe totality of the circumstancesappellant's confession was freely and voluntarily given. The totality of the circumstances show that appellant was informed of his rights numerous times and that he conferred with his attorney immediately prior to making a statement. Appellant told the police and indicated to his attorney that he wanted to confess. Once his fears about the death penalty were erased, appellant did confess. The circumstances show that appellant voluntarily and freely confessed. The ground of error is overruled. Appellant next contends that his confession was taken in violation of the rule set out in Edwards v. Arizona, 451 U.S. 477, 101 S. Ct. 1880, 68 L. Ed. 2d 378 (1981) because the police initiated the conversation with him that led to his confession after he had invoked his right to counsel. The Court of Appeals held that appellant had initiated the conversation which resulted in his confession.",
"Rhoads testified that when he arrived in Pulaski he met with appellant, informed him of his rights, told him not to say anything, and to listen while Rhoads told him what the police knew about the offense. Rhoads asked appellant if he wanted to talk and appellant indicated he would like to talk to Rhoads but that he was concerned about the death penalty and first wanted to speak with his attorney. After appellant spoke with his attorney in a room in the kitchen area of the sheriff's office, he remained there while his attorney talked to Rhoads. Jernigan went into the kitchen, *732 fixed himself a cup of coffee and asked appellant if he wanted one. The two of them started talking.",
"Jernigan testified that he did not remember what they talked about except that they talked about \"various things, not the case, justwe were just talking,\" being friendly. During their conversation Jernigan asked appellant if he was hungry and appellant told him he was, but that he had been unable to eat or sleep since \"it happened.\" Appellant said \"I've got to talk about this thing. I've got to get it off my chest. I can't eat or sleep.\" Jernigan testified that appellant also told him that \"he had tried to explain to his attorney that he wanted to talk about it and that he knew he would have to go back to Texas and get it worked out and that the attorney had not listened to him and that he couldn't go any longer, he had to get something to eat and some sleep, some rest.\" At this point Jernigan left the kitchen and told Rhoads that appellant wanted to talk to him.",
"Jernigan brought appellant into his office and Rhoads asked him if he wanted to talk to him. Appellant said \"Yes, but I'm still afraid. I'm too young to die.\" Jernigan testified that Rhoads \"very carefully\" went over appellant's right to have his attorney present. He asked appellant if he wanted them to call Stack back or whether he wanted to go on without him. Appellant said he wanted to talk to Rhoads about it. Several more times Rhoads stated to appellant that he could have his attorney with him, but appellant indicated he wished to talk to Rhoads. Rhoads then gave appellant a written statement that he would not be charged with capital murder. Appellant and Rhoads talked and appellant confessed to his part in the murder. Once a defendant invokes his right to counsel, he may not be subjected to further interrogation until counsel is present, unless the defendant himself initiates dialogue with the authorities.",
"Edwards v. Arizona, supra. Where reinterrogation follows such initiation by a defendant, the State still has a \"heavy burden\" to show that a defendant's waiver of his right to counsel during interrogation was knowing and intelligent. Oregon v. Bradshaw, 462 U.S. 1039, 103 S. Ct. 2830, 77 L. Ed. 2d 405 (1983); Edwards v. Arizona, supra; Wilkerson v. State, 657 S.W.2d 784 (Tex. Cr.App.1983). Appellant contends that Jernigan initiated the conversation in the kitchen and thus violated his previously invoked right to counsel. Jernigan stated that he simply asked appellant if he wanted a cup of coffee and they had a friendly conversation.",
"The State argues that appellant initiated further interrogation about the offense by his response to Jernigan's innocuous inquiry about whether he was hungry. The rule set out in Edwards v. Arizona, supra, does not forbid all conversation between police and an accused. As the Supreme Court noted in Oregon v. Bradshaw, 462 U.S. at 1045, 103 S. Ct. at 2835, it is doubtful \"that it would be desirable to build a superstructure of legal refinements around the word `initiate' in this context, [and] there are undoubtedly situations where a bare inquiry by either a defendant or by police officer should not be held to `initiate' any conversation or dialogue.\" The rule \"is designed to protect an accused in police custody from being badgered by police officers in the manner in which the defendant in Edwards was.\" Oregon v. Bradshaw, 462 U.S. at 1044, 103 S. Ct. at 2834. In the instant case the record of the pretrial hearing shows that Jernigan's conversation with appellant, begun by asking if appellant wanted something to drink, was simply a \"friendly conversation\" that had nothing to do with the case.",
"The conversation was not an effort to elicit a statement, confession, or incriminating information from appellant. It was not an attempt at subtle interrogation designed to coerce appellant into confessing. Cf. Brewer v. Williams, 430 U.S. 387, 97 S. Ct. 1232, 51 L. Ed. 2d 424 (1977); Bush v. State, 697 S.W.2d 397 (Tex.Cr.App.1985). Neither the rule nor the rationale of Edwards v. Arizona, supra, was violated by Jernigan's conversation with appellant in the kitchen of the Sheriff's office. The conversation is *733 analogous to the \"bare inquiry\" type of dialogue noted in Oregon v. Bradshaw, supra, which are \"routine incidents of the custodial relationship\" and which do not constitute \"initiation\" in the sense forbidden in Edwards v. Arizona, supra.",
"While it was more detailed than a \"bare inquiry,\" the gist of the conversation was the same. The spirit and rule of Edwards v. Arizona, supra, certainly does not require absolute silence between an accused and the police, once the accused has invoked his right to counsel. Jernigan knew appellant and a \"friendly conversation\", small talk, including inquiries about thirst and hunger, does not constitute \"initiation\" of interrogation as forbidden by Edwards v. Arizona, supra. The \"initiation\" of communication about the offense came from appellant in his response to Jernigan's question about whether he was hungry. Jernigan, naturally interpreting appellant's response to indicate a desire to talk, promptly told Rhoads.",
"Rhoads checked with appellant to be certain he wanted to talk and that he did not want his counsel present. Appellant said he wanted to talk and waived his right to counsel. The record of the particular facts and circumstances of this case thus shows that appellant initiated the reinterrogation about the offense. Also, appellant had just spoken with his attorney before talking to Jernigan and Rhoads and he was informed of his rights on numerous occasions. We hold that the record also shows that appellant knowingly and intelligently waived his right to counsel.",
"Appellant contends that his testimony at the pretrial hearing is undisputed and reflects a situation analogous to Bush, supra, in that subtle interrogation and coercion was employed by Jernigan. Appellant testified that Jernigan and he sat in the kitchen drinking coffee and Jernigan told him a story about \"I don't know, some guy blowing his head off over a crime, and he left a note about the guilt being too much for him and everything like that; and he was saying that, you know, if I'd go ahead andyou know, with the evidence they've got they could convict me, and if I go ahead and make a statement to him it would go easier on me and everything like that.\" Appellant also testified that Rhoads then came into the kitchen and told appellant that he, Rhoads, was leaving the next morning and appellant had a choice of making a statement that night or in the morning, but that if he did not make a statement Rhoads would file a capital murder charge. Appellant also said he repeatedly asked that his attorney be present. Jernigan was not recalled to testify about whether or not he told appellant a story about someone committing suicide over a crime about which he felt guilty.",
"Appellant was not asked whether he told Jernigan he wanted to talk about it, to \"get it off his chest.\" If appellant's version is believed the confession is involuntary and his right to counsel was blatantly violated. The trial court obviously rejected appellant's testimony by finding the confession to have been voluntarily and freely made. The trial court is the sole judge of the credibility of the witnesses in a pretrial hearing.",
"Absent a showing of an abuse of discretion the trial court's findings will not be disturbed. Hawkins, supra. The ground of error is overruled. The judgment of the Court of Appeals affirming the trial court is likewise affirmed. TOM G. DAVIS, J. concurs in the result. ONION, P.J., and CLINTON and TEAGUE, JJ., dissent. NOTES [1] Appellant was from Tennessee. Under Tennessee law the offense of murder was punishable by death.",
"This might explain appellant's concern about the death penalty. [2] The case was not a capital murder case because appellant, who was apparently having an affair with Waddell's wife, murdered Waddell and then committed robbery only to disguise his motive and hopefully his identity in committing the murder. See V.T.C.A. Penal Code, Sec. 19.03(a)(2)."
] | https://www.courtlistener.com/api/rest/v3/opinions/1485522/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
CRONE, J. Reversed. VAIDIK, C.J., Concurs. BARNES, J., Concurs. | 07-24-2022 | [
"CRONE, J. Reversed. VAIDIK, C.J., Concurs. BARNES, J., Concurs."
] | https://www.courtlistener.com/api/rest/v3/opinions/7083760/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Citation Nr: 0304297
Decision Date: 03/10/03 Archive Date: 03/18/03
DOCKET NO. 00-12 389 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office in Waco, Texas
THE ISSUE
Entitlement to service connection for a gastrointestinal
disorder, to include irritable bowel syndrome and/or ulcer.
REPRESENTATION
Appellant represented by: Texas Veterans Commission
WITNESS AT HEARING ON APPEAL
Veteran
ATTORNEY FOR THE BOARD
Elizabeth Spaur, Associate Counsel
INTRODUCTION
The veteran had active service from December 1976 to December
1980.
This matter comes before the Board of Veterans' Appeals
(Board) on appeal from a March 1999 decision by the
Department of Veterans Affairs (VA) Waco, Texas, Regional
Office (RO). That decision, in pertinent part, denied
service connection for irritable bowel syndrome. In an
August 2001 remand, the Board noted that the veteran had also
claimed service connection for an ulcer. Therefore, the
Board characterized the issue as entitlement to service
connection for a gastrointestinal disorder, to include
irritable bowel syndrome and/or ulcer and remanded the claim
for further development.
FINDINGS OF FACT
1. All evidence necessary for review of the issue on appeal
has been obtained, and the VA has satisfied the duty to
notify the veteran of the law and regulations applicable to
the claim, the evidence necessary to substantiate the claim,
and what evidence was to be provided by the veteran and what
evidence the VA would attempt to obtain on his behalf.
2. The evidence does not reasonably show that a
gastrointestinal disorder, to include irritable bowel
syndrome and/or ulcer, had origins in, or is otherwise
related to, the veteran's period of service.
CONCLUSION OF LAW
A gastrointestinal disorder, to include irritable bowel
syndrome and/or ulcer was not incurred in or aggravated by
service. 38 U.S.C.A. § 1131 (West 2002); 38 C.F.R. § 3.303
(2002).
REASONS AND BASES FOR FINDINGS AND CONCLUSION
I. Duty to Assist
As an initial matter, the Board observes that, during the
pendency of this appeal, substantial revisions have been made
to the laws and regulations concerning the VA's duties in
developing a claim for a VA benefit. On November 9, 2000,
the Veterans Claims Assistance Act (VCAA), Pub. L. No. 106-
475, 11 Stat. 2096 (2000) was enacted. The VCAA redefines
the VA's obligations with respect to its duty to assist the
claimant with the development of facts pertinent to a claim
and includes an enhanced duty to notify the claimant as to
the information and evidence necessary to substantiate a
claim for VA benefits. This change in the law is applicable
to all claims filed on or after the date of enactment of the
VCAA or filed before the date of enactment and not yet final
as of that date. 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A,
5106, 5107, 5126 (West 1991 & Supp. 2002). See also Karnas
v. Derwinski, 1 Vet. App. 308, 312-313 (1991).
The final rule implementing the VCAA was published on August
29, 2001. 66 Fed. Reg. 45,620-45,623 (Aug. 29, 2001)
(codified as amended at 38 C.F.R. §§ 3.156(a), 3.159 and
3.326(a) (2002)). These regulations, likewise, apply to any
claim for benefits received by the VA on or after November 9,
2000, as well as to any claim filed before that date but not
decided by the VA as of that date, with the exception of the
amendment to 38 C.F.R. § 3.156(a) (relating to the definition
of new and material evidence) and to the second sentence of
§ 3.159(c) and § 3.159(c)(4)(iii) (pertaining to VA
assistance in the case of claims to reopen previously denied
final claims), which apply to any application to reopen a
finally decided claim received on or after August 29, 2001.
See 66 Fed. Reg. 45,620 (Aug. 29, 2001).
In this case, the Board finds that all relevant facts have
been properly developed in regard to the veteran's claim, and
no further assistance is required in order to comply with the
VA's statutory duty to assist him with the development of
facts pertinent to his claim. See 38 U.S.C.A. § 5103A (West
Supp. 2002); 38 C.F.R. § 3.159 (2002). Specifically, the RO
has obtained records corresponding to medical treatment
reported by the veteran and has afforded him a thorough VA
examination addressing his gastrointestinal disorder. There
is no indication of additional relevant medical evidence that
has not been obtained by the RO to date.
The VA's duty to notify the veteran of the evidence necessary
to substantiate his claim has also been met, as the RO
informed him of the need for such evidence in an October 2001
letter. See 38 U.S.C.A. § 5103A (West 1991 & Supp. 2002).
This letter, which includes a summary of the newly enacted
provisions of 38 U.S.C.A. §§ 5103 and 5103A, also contains a
specific explanation of the type of evidence necessary to
substantiate the veteran's claim, as well as which portion of
that evidence (if any) was to be provided by him and which
portion the VA would attempt to obtain on his behalf. The
specific requirements for a grant of the benefit sought on
appeal will be discussed in further detail below, in
conjunction with the discussion of the specific facts of this
case. See generally Quartuccio v. Principi, 16 Vet. App. 183
(2002).
II. Factual Background
Service medical records indicate that the veteran complained
of stomach pain in February 1980. No diagnosis was made. A
July 1980 service medical record indicated that the veteran
continued to experience stomach pain and complained of loose
bowel movements. Initially, he was diagnosed with intestinal
flu, but was referred for a consultation. At the
consultation, he was provisionally diagnosed with intestinal
diarrhea. The report of medical history, given at the
veteran's October 1980 separation examination, showed that he
did not respond to the question regarding previous or current
existence of stomach, liver or intestinal trouble. The
separation examination report did not note any
gastrointestinal complaints.
VA medical records noted that the veteran sought treatment in
December 1980, several weeks after discharge. At that time,
he complained of stomach cramps and gas. He was diagnosed
with functional irritable bowel syndrome.
A July 1998 VA treatment note indicated that the veteran
complained of an upset stomach. A February 1999 VA treatment
reported that the veteran continued to complain of stomach
pain. At that time, the diagnosis was gastritis.
An October 2000 VA treatment note reflected that the veteran
continued to complain of gastrointestinal problems including
gas, abdominal spasms and problems with his bowel movements.
The veteran testified before a hearing officer at a hearing
held at the RO in January 2001. He stated that he first saw
a doctor in service in July 1980 regarding his
gastrointestinal problems. He testified that he sought
treatment at the VA in Shreveport regarding stomach problems
and irritable bowel syndrome in December 1980, several weeks
after separation from service. The veteran indicated that he
did not seek treatment again until 1998. He also reported
that he had been diagnosed with an ulcer.
An August 2002 VA examination report noted that the examiner
reviewed the veteran's claims folder. The diagnosis was
intermittent diarrhea with constipation and heme-positive
stool. The examiner noted that a final opinion would be
rendered after further testing.
A September 2002 VA upper gastrointestinal series noted a
minor reflux during the examination. The impression was that
there might be mild gastritis and duodenitis. A September
2002 VA small bowel study was normal.
A November 2002 addendum to the August 2002 VA examination
report noted that the examiner had reviewed the veteran's
medical history, physical examination, lab work and upper and
lower gastrointestinal series. It was the examiner's opinion
that the veteran's gastrointestinal disorders of mild
gastritis, duodenitis, along with a history of once a month
diarrhea and constipation were "not related to his symptoms
in the medical service record." The examiner noted that the
veteran's blood count indicated stable hemoglobin and
hematocrit in the normal range, which excluded anemia that
"would or should be present if these findings had been
present since service." Finally, the examiner stated "all
findings indicate that these are acute symptoms and are
unrelated to military duty."
III. Criteria
Service connection may be granted for a disability resulting
from disease or injury incurred in or aggravated by service.
38 U.S.C.A. § 1131. Service connection may be granted for
any disease diagnosed after discharge, when all the evidence,
including that pertinent to service, establishes that the
disease was incurred in service. 38 C.F.R. § 3.303(d)
(2001).
When all the evidence is assembled, VA is responsible for
determining whether the evidence supports the claim or is in
relative equipoise, with the appellant prevailing in either
event, or whether a preponderance of the evidence is against
a claim, in which case, the claim is denied. Gilbert v.
Derwinski, 1 Vet. App. 49 (1990).
IV. Analysis
After having carefully reviewed the evidence of record, the
Board finds that the evidence is against a grant of service
connection for the claimed gastrointestinal problems. The
United States Court of Appeals for Veterans Claims (Court)
has held that in order to establish service connection, there
must be evidence of both a service-connected disease or
injury and a present disability which is attributable to such
disease or injury. See Rabideau v. Derwinski, 2 Vet. App.
141, 143 (1992).
The Court has also held that generally, to prove service
connection, a claimant must submit (1) medical evidence of a
current disability, (2) medical evidence, or in certain
circumstances lay testimony, of in-service incurrence or
aggravation of an injury or disease, and (3) medical evidence
of a nexus between the current disability and the in-service
disease or injury. See Pond v. West, 12 Vet. App. 341, 346
(1999); see also Rose v. West, 11 Vet. App. 169, 171 (1998).
The Board finds that the evidence of record shows that the
veteran has competent medical diagnoses of mild gastritis,
duodenitis, and a history of once a month episodes of
diarrhea and constipation. Ulcers are not shown by the
clinical record. See Gilpin v. West, 155 F.3d 1353 (Fed.
Cir. 1998) (holding VA's interpretation of the provisions of
38 U.S.C.A. § 1110 to require evidence of a present
disability to be consistent with congressional intent);
Rabideau v. Derwinski, 2 Vet. App. 141 (1992) (the law limits
entitlement for service-related diseases and injuries to
cases where the underlying in-service incident resulted in a
disability).
The question of whether the veteran's current problems had
their onset in or are otherwise related to active service,
involves competent medical evidence as to medical causation.
Grottveit v. Brown, 5 Vet. App. 91, 92 (1993).
The Board notes the veteran's treatment for stomach
complaints during service and in December 1980, several weeks
after service. However, evidence of record shows that the
veteran did not seek treatment again for gastrointestinal
complaints until 1998. The November 2002 VA examination
addendum noted the examiner's opinion that the veteran's
current gastrointestinal diagnoses were "not related to his
symptoms in the medical service record." Finally, the
examiner states "all findings indicate that these are acute
symptoms and are unrelated to military duty." Accordingly,
without any competent evidence of a nexus between the
diagnosed disorders and the veteran's service, there is no
basis for a grant of service connection for any of the
claimed gastrointestinal disorders..
ORDER
Service connection for a gastrointestinal disorder, to
include irritable bowel syndrome and/or ulcer is denied.
____________________________________________
JEFF MARTIN
Veterans Law Judge, Board of Veterans' Appeals
IMPORTANT NOTICE: We have attached a VA Form 4597 that tells
you what steps you can take if you disagree with our
decision. We are in the process of updating the form to
reflect changes in the law effective on December 27, 2001.
See the Veterans Education and Benefits Expansion Act of
2001, Pub. L. No. 107-103, 115 Stat. 976 (2001). In the
meanwhile, please note these important corrections to the
advice in the form:
? These changes apply to the section entitled "Appeal to
the United States Court of Appeals for Veterans
Claims." (1) A "Notice of Disagreement filed on or
after November 18, 1988" is no longer required to
appeal to the Court. (2) You are no longer required to
file a copy of your Notice of Appeal with VA's General
Counsel.
? In the section entitled "Representation before VA,"
filing a "Notice of Disagreement with respect to the
claim on or after November 18, 1988" is no longer a
condition for an attorney-at-law or a VA accredited
agent to charge you a fee for representing you. | 03-10-2003 | [
"Citation Nr: 0304297 Decision Date: 03/10/03 Archive Date: 03/18/03 DOCKET NO. 00-12 389 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Waco, Texas THE ISSUE Entitlement to service connection for a gastrointestinal disorder, to include irritable bowel syndrome and/or ulcer. REPRESENTATION Appellant represented by: Texas Veterans Commission WITNESS AT HEARING ON APPEAL Veteran ATTORNEY FOR THE BOARD Elizabeth Spaur, Associate Counsel INTRODUCTION The veteran had active service from December 1976 to December 1980. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a March 1999 decision by the Department of Veterans Affairs (VA) Waco, Texas, Regional Office (RO). That decision, in pertinent part, denied service connection for irritable bowel syndrome. In an August 2001 remand, the Board noted that the veteran had also claimed service connection for an ulcer. Therefore, the Board characterized the issue as entitlement to service connection for a gastrointestinal disorder, to include irritable bowel syndrome and/or ulcer and remanded the claim for further development. FINDINGS OF FACT 1.",
"All evidence necessary for review of the issue on appeal has been obtained, and the VA has satisfied the duty to notify the veteran of the law and regulations applicable to the claim, the evidence necessary to substantiate the claim, and what evidence was to be provided by the veteran and what evidence the VA would attempt to obtain on his behalf. 2. The evidence does not reasonably show that a gastrointestinal disorder, to include irritable bowel syndrome and/or ulcer, had origins in, or is otherwise related to, the veteran's period of service. CONCLUSION OF LAW A gastrointestinal disorder, to include irritable bowel syndrome and/or ulcer was not incurred in or aggravated by service. 38 U.S.C.A. § 1131 (West 2002); 38 C.F.R. § 3.303 (2002). REASONS AND BASES FOR FINDINGS AND CONCLUSION I. Duty to Assist As an initial matter, the Board observes that, during the pendency of this appeal, substantial revisions have been made to the laws and regulations concerning the VA's duties in developing a claim for a VA benefit. On November 9, 2000, the Veterans Claims Assistance Act (VCAA), Pub. L. No. 106- 475, 11 Stat.",
"2096 (2000) was enacted. The VCAA redefines the VA's obligations with respect to its duty to assist the claimant with the development of facts pertinent to a claim and includes an enhanced duty to notify the claimant as to the information and evidence necessary to substantiate a claim for VA benefits. This change in the law is applicable to all claims filed on or after the date of enactment of the VCAA or filed before the date of enactment and not yet final as of that date.",
"38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5106, 5107, 5126 (West 1991 & Supp. 2002). See also Karnas v. Derwinski, 1 Vet. App. 308, 312-313 (1991). The final rule implementing the VCAA was published on August 29, 2001. 66 Fed. Reg. 45,620-45,623 (Aug. 29, 2001) (codified as amended at 38 C.F.R. §§ 3.156(a), 3.159 and 3.326(a) (2002)). These regulations, likewise, apply to any claim for benefits received by the VA on or after November 9, 2000, as well as to any claim filed before that date but not decided by the VA as of that date, with the exception of the amendment to 38 C.F.R. § 3.156(a) (relating to the definition of new and material evidence) and to the second sentence of § 3.159(c) and § 3.159(c)(4)(iii) (pertaining to VA assistance in the case of claims to reopen previously denied final claims), which apply to any application to reopen a finally decided claim received on or after August 29, 2001. See 66 Fed.",
"Reg. 45,620 (Aug. 29, 2001). In this case, the Board finds that all relevant facts have been properly developed in regard to the veteran's claim, and no further assistance is required in order to comply with the VA's statutory duty to assist him with the development of facts pertinent to his claim. See 38 U.S.C.A. § 5103A (West Supp. 2002); 38 C.F.R. § 3.159 (2002). Specifically, the RO has obtained records corresponding to medical treatment reported by the veteran and has afforded him a thorough VA examination addressing his gastrointestinal disorder. There is no indication of additional relevant medical evidence that has not been obtained by the RO to date. The VA's duty to notify the veteran of the evidence necessary to substantiate his claim has also been met, as the RO informed him of the need for such evidence in an October 2001 letter. See 38 U.S.C.A. § 5103A (West 1991 & Supp.",
"2002). This letter, which includes a summary of the newly enacted provisions of 38 U.S.C.A. §§ 5103 and 5103A, also contains a specific explanation of the type of evidence necessary to substantiate the veteran's claim, as well as which portion of that evidence (if any) was to be provided by him and which portion the VA would attempt to obtain on his behalf. The specific requirements for a grant of the benefit sought on appeal will be discussed in further detail below, in conjunction with the discussion of the specific facts of this case. See generally Quartuccio v. Principi, 16 Vet. App. 183 (2002). II. Factual Background Service medical records indicate that the veteran complained of stomach pain in February 1980. No diagnosis was made. A July 1980 service medical record indicated that the veteran continued to experience stomach pain and complained of loose bowel movements. Initially, he was diagnosed with intestinal flu, but was referred for a consultation. At the consultation, he was provisionally diagnosed with intestinal diarrhea. The report of medical history, given at the veteran's October 1980 separation examination, showed that he did not respond to the question regarding previous or current existence of stomach, liver or intestinal trouble.",
"The separation examination report did not note any gastrointestinal complaints. VA medical records noted that the veteran sought treatment in December 1980, several weeks after discharge. At that time, he complained of stomach cramps and gas. He was diagnosed with functional irritable bowel syndrome. A July 1998 VA treatment note indicated that the veteran complained of an upset stomach. A February 1999 VA treatment reported that the veteran continued to complain of stomach pain. At that time, the diagnosis was gastritis. An October 2000 VA treatment note reflected that the veteran continued to complain of gastrointestinal problems including gas, abdominal spasms and problems with his bowel movements.",
"The veteran testified before a hearing officer at a hearing held at the RO in January 2001. He stated that he first saw a doctor in service in July 1980 regarding his gastrointestinal problems. He testified that he sought treatment at the VA in Shreveport regarding stomach problems and irritable bowel syndrome in December 1980, several weeks after separation from service. The veteran indicated that he did not seek treatment again until 1998. He also reported that he had been diagnosed with an ulcer. An August 2002 VA examination report noted that the examiner reviewed the veteran's claims folder.",
"The diagnosis was intermittent diarrhea with constipation and heme-positive stool. The examiner noted that a final opinion would be rendered after further testing. A September 2002 VA upper gastrointestinal series noted a minor reflux during the examination. The impression was that there might be mild gastritis and duodenitis. A September 2002 VA small bowel study was normal. A November 2002 addendum to the August 2002 VA examination report noted that the examiner had reviewed the veteran's medical history, physical examination, lab work and upper and lower gastrointestinal series. It was the examiner's opinion that the veteran's gastrointestinal disorders of mild gastritis, duodenitis, along with a history of once a month diarrhea and constipation were \"not related to his symptoms in the medical service record.\" The examiner noted that the veteran's blood count indicated stable hemoglobin and hematocrit in the normal range, which excluded anemia that \"would or should be present if these findings had been present since service.\" Finally, the examiner stated \"all findings indicate that these are acute symptoms and are unrelated to military duty.\"",
"III. Criteria Service connection may be granted for a disability resulting from disease or injury incurred in or aggravated by service. 38 U.S.C.A. § 1131. Service connection may be granted for any disease diagnosed after discharge, when all the evidence, including that pertinent to service, establishes that the disease was incurred in service. 38 C.F.R. § 3.303(d) (2001). When all the evidence is assembled, VA is responsible for determining whether the evidence supports the claim or is in relative equipoise, with the appellant prevailing in either event, or whether a preponderance of the evidence is against a claim, in which case, the claim is denied.",
"Gilbert v. Derwinski, 1 Vet. App. 49 (1990). IV. Analysis After having carefully reviewed the evidence of record, the Board finds that the evidence is against a grant of service connection for the claimed gastrointestinal problems. The United States Court of Appeals for Veterans Claims (Court) has held that in order to establish service connection, there must be evidence of both a service-connected disease or injury and a present disability which is attributable to such disease or injury. See Rabideau v. Derwinski, 2 Vet. App. 141, 143 (1992). The Court has also held that generally, to prove service connection, a claimant must submit (1) medical evidence of a current disability, (2) medical evidence, or in certain circumstances lay testimony, of in-service incurrence or aggravation of an injury or disease, and (3) medical evidence of a nexus between the current disability and the in-service disease or injury. See Pond v. West, 12 Vet.",
"App. 341, 346 (1999); see also Rose v. West, 11 Vet. App. 169, 171 (1998). The Board finds that the evidence of record shows that the veteran has competent medical diagnoses of mild gastritis, duodenitis, and a history of once a month episodes of diarrhea and constipation. Ulcers are not shown by the clinical record. See Gilpin v. West, 155 F.3d 1353 (Fed. Cir. 1998) (holding VA's interpretation of the provisions of 38 U.S.C.A. § 1110 to require evidence of a present disability to be consistent with congressional intent); Rabideau v. Derwinski, 2 Vet. App. 141 (1992) (the law limits entitlement for service-related diseases and injuries to cases where the underlying in-service incident resulted in a disability). The question of whether the veteran's current problems had their onset in or are otherwise related to active service, involves competent medical evidence as to medical causation.",
"Grottveit v. Brown, 5 Vet. App. 91, 92 (1993). The Board notes the veteran's treatment for stomach complaints during service and in December 1980, several weeks after service. However, evidence of record shows that the veteran did not seek treatment again for gastrointestinal complaints until 1998. The November 2002 VA examination addendum noted the examiner's opinion that the veteran's current gastrointestinal diagnoses were \"not related to his symptoms in the medical service record.\" Finally, the examiner states \"all findings indicate that these are acute symptoms and are unrelated to military duty.\" Accordingly, without any competent evidence of a nexus between the diagnosed disorders and the veteran's service, there is no basis for a grant of service connection for any of the claimed gastrointestinal disorders.. ORDER Service connection for a gastrointestinal disorder, to include irritable bowel syndrome and/or ulcer is denied. ____________________________________________ JEFF MARTIN Veterans Law Judge, Board of Veterans' Appeals IMPORTANT NOTICE: We have attached a VA Form 4597 that tells you what steps you can take if you disagree with our decision.",
"We are in the process of updating the form to reflect changes in the law effective on December 27, 2001. See the Veterans Education and Benefits Expansion Act of 2001, Pub. L. No. 107-103, 115 Stat. 976 (2001). In the meanwhile, please note these important corrections to the advice in the form: ? These changes apply to the section entitled \"Appeal to the United States Court of Appeals for Veterans Claims.\" (1) A \"Notice of Disagreement filed on or after November 18, 1988\" is no longer required to appeal to the Court. (2) You are no longer required to file a copy of your Notice of Appeal with VA's General Counsel.",
"? In the section entitled \"Representation before VA,\" filing a \"Notice of Disagreement with respect to the claim on or after November 18, 1988\" is no longer a condition for an attorney-at-law or a VA accredited agent to charge you a fee for representing you."
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Mr. JUSTICE GUILD delivered the opinion of the court: Defendant herein has filed two separate appeals, the first being from the order of the trial court reducing the amount of alimony payable by him and the second appeal being from an order of the trial court awarding the plaintiff the sum of *750 for attorney’s fees and costs of appeal. The cases have been consolidated for the purpose of this opinion. The parties hereto were married on October 15, 1946. They were divorced on October 2, 1972, and at the time of the divorce the two children of the parties were emancipated. The decree of divorce provided that the defendant husband pay the wife the sum of *500 monthly for alimony based upon the husband’s gross annual income of *23,000. On July 1,1975, defendant filed a petition to modify the decree of divorce, by either terminating the alimony provisions of the decree or reducing the same based upon the present earnings of both parties and upon the physical condition of the defendant. A hearing on the petition was originally set for July 15, 1975, but on July 11 it was reset for August 17 and the trial judge ordered that any reduction would be effective as of July 15, 1975. The hearing on the modification was had on August 18, 1975. On December 12, 1975, the trial court reduced the alimony payments from *500 a month to *350 a month. From that order the defendant appealed. On February 18, 1976, the trial court entered the aforementioned order providing for *750 attorney’s fees and costs on appeal and the defendant has likewise appealed from that order. The defendant contends that the refusal of the court to either terminate the alimony payments required under the decree or to reduce the same to a bare minimum was against the manifest weight of the evidence or an abuse of the discretion of the trial court. The evidence discloses that the defendant had a stroke in December 1973 and was hospitalized for 20 days. He testified that since that time he suffered various disabilities, including difficulty in walking, double vision and is unable to work full time. It was stipulated by the parties that the defendant was presently suffering from cardiac insufficiency, angina, a severe case of hypertension and heart disease. As indicated above, the alimony payments provided for in the decree were based upon the defendant’s earnings at that time of approximately *23,000 a year. The evidence discloses that for the year 1974 the defendant’s income was reduced to approximately *18,000. Defendant estimated his income for the year 1975 would be between *14-15,000. The plaintiff, however, points out that this estimate does not take into consideration the fact that he is paying 25% of his gross earnings towards the purchase of a business from another insurance agent which, in effect, is a capital investment. Plaintiff also points out that he is using his home in which he resides with his second wife and is deducting as a cost of doing business the use of a portion of the premises for that purpose. The record further discloses that at the time of the hearing on the reduction of the alimony payments the plaintiff, who was unemployed at the time of the divorce, was gainfully employed as a clerk for Sears, Roebuck & Co., earning approximately *8,000 a year. Without going into detail as to the further assets of the defendant under his present marriage, we do not believe that the court abused its discretion in only reducing the monthly alimony payments from *500 to *350 a month. The parties here were married for a period of approximately 27 years and it is true the defendant’s earning capacity was and probably still is reduced, we will not substitute our opinion for that of the trial court in this regard. A review of the record presented to us indicates the reduction ordered by the trial court was fair and proper based upon purported current income of the defendant at the time of the hearing on the petition for reduction of alimony payments and the current earnings of the plaintiff who had become employed subsequent to the divorce. A more interesting question is presented relative to the order of the trial court awarding the plaintiff the sum of $750 for attorney’s fees and costs to prosecute her defense of the appeal by the defendant from the order of the trial court reducing the alimony payments. There appears to be a division of authority in Illinois as to whether or not the trial court may in fact award attorney’s fees for the purpose of defending an appeal from a post-decretal order of the trial court. This is best typified by a comparison of the cases. In Kinzora v. Kinzora (1976), 37 Ill. App. 3d 290, 294, 345 N.E.2d 499, 502, the Fourth District appellate court stated: “Defendant last argues that it was error for the court to award the wife attorney’s fees to defend the appeal. Unquestionably, the trial court has the right to award fees to defend on appeal. (Ill. Rev. Stat. 1973, ch. 40, par. 16; Woodshank v. Woodshank, 13 Ill. App. 3d 692, 300 N.E.2d 494.)” On the other hand the First District, in Horwitz v. Horwitz (1970), 130 Ill. App. 2d 424, 428, 264 N.E.2d 723, 725, found in considering section 15 of the Divorce Act (Ill. Rev. Stat. 1965, ch. 40, par. 16): “However, this provision by its express terms applies only to matters culminating in the original divorce decree and does not authorize an allowance of attorney’s fees to defend an appeal from a post-decretal order. Therefore, the trial court erred in ordering plaintiff to pay defendant’s attorney an allowance for defense of plaintiff’s initial appeal.” See also Goldberg v. Goldberg (1st Dist. 1975), 30 Ill. App. 3d 769, 775, 332 N.E.2d 710, 715; Hall v. Hall (1975), 25 Ill. App. 3d 524, 323 N.E.2d 541. This court, in Waltrip v. Waltrip (1972), 3 Ill. App. 3d 892, 897, 279 N.E.2d 405, 409, found that: “Section 15 of the Divorce Act does not specifically limit the allowance of attorney’s fees for defense of an appeal to an appeal from the divorce decree itself 0 0 0 we believe the language used by the legislature in providing fees for defense of an appeal indicates that the legislature contemplated that such fees could be awarded on post-decretal orders as well.” See also Riddlesbarger v. Riddlesbarger (1952), 348 Ill. App. 31, 107 N.E.2d 770. We adhere to our position as set forth in Waltrip and find that under the statute in effect at the time of the hearing herein the trial court could, under proper circumstances, award attorney’s fees for the purpose of defending an appeal from a post-decretal order of the trial court. However, the question then arises as to when and under what circumstances such attorney’s fees and costs may and should be awarded. The cotut in McLeod v. McLeod (1971), 133 Ill. App. 2d 111, 113, 272 N.E.2d 834, 836, stated: “As regards the separate appeal concerning attorney’s fees, there is no evidence in this record of the inability of plaintiff to pay her own attorney’s fees. It has long been the law in Illinois that in a divorce proceeding allowance of attorney’s fees is not automatic but depends upon a showing that one of the parties is financially unable to pay their own fees and that the opposing party does have such ability.” The court found that under the facts of that case that it was not an abuse of discretion for the trial court to allow attorney’s fees to the plaintiff on appeal. The question thus presents itself as to whether or not the trial court did, under the facts of the case herein, abuse its discretion in awarding attorney’s fees to the plaintiff for the purpose of defending the appeal. We believe that the awarding of attorney’s fees herein to the plaintiff was not justified. Since the entry of the decree of divorce herein there is no evidence to indicate that the defendant did not at all times make the required *500 monthly alimony payments. It is to be presumed, and the record does not disclose otherwise, that the defendant has continued to make the reduced payments of *350 a month since the decree was modified. The defendant’s income has obviously been somewhat substantially reduced as evidenced by the trial court’s reduction of the amount of alimony payments and since the entry of the decree the plaintiff has become gainfully employed, earning approximately *8,000 a year. Based upon the reduced alimony payments of *350 a month, she received alimony payments of *4,200, which indicates a gross income to her of *12,200 per year. On the other hand, the defendant’s income is slightly in excess of that. While we adhere to our prior ruling that attorney’s fees and costs of appeal may be awarded under proper circumstances, we do not feel that such an award in the instant case was proper. It is true that the plaintiff testified in substance that her income was not sufficient to pay for the cost of appeal but the facts indicate otherwise. The pertinent statutory authority for the awarding of attorney’s fees in divorce proceedings is found in section 15 of the Divorce Act which provided in pertinent part, at the time of the entry of the decree and the entry of the order modifying the alimony payments herein that: “ 0 ° 0 In case of appeal by the husband or wife, the court in which the decree order is rendered may grant and enforce the payment of such money for her or his defense and such equitable alimony during the pendency of the appeal as to such court shall seem reasonable and proper. * ° *” (Ill. Rev. Stat. 1975, ch. 40, par. 16.) This provision of section 15 was deleted by the legislature by Public Act 79-1360, effective October 1, 1976. This change in the amended act was pointed out in a motion filed by the defendant herein which we ordered taken with the case. The plaintiff has objected thereto. The objection is not well taken as this court has authority to consider any statutory modifications applicable to the cause being considered by this court. However, in view of our decision herein that the award of attorney’s fees was improper based upon the facts presented to the trial court, we need not reach the question of whether the order entered herein could be affected by the statutory modification which took effect several months later. The order of the trial court reducing the monthly alimony payments is affirmed. The order of the trial court awarding attorney’s fees to the plaintiff for the purpose of this appeal is reversed. Affirmed in part: reversed in part. RECHENMACHER, P. J., and BOYLE, J., concur. | 07-24-2022 | [
"Mr. JUSTICE GUILD delivered the opinion of the court: Defendant herein has filed two separate appeals, the first being from the order of the trial court reducing the amount of alimony payable by him and the second appeal being from an order of the trial court awarding the plaintiff the sum of *750 for attorney’s fees and costs of appeal. The cases have been consolidated for the purpose of this opinion. The parties hereto were married on October 15, 1946. They were divorced on October 2, 1972, and at the time of the divorce the two children of the parties were emancipated.",
"The decree of divorce provided that the defendant husband pay the wife the sum of *500 monthly for alimony based upon the husband’s gross annual income of *23,000. On July 1,1975, defendant filed a petition to modify the decree of divorce, by either terminating the alimony provisions of the decree or reducing the same based upon the present earnings of both parties and upon the physical condition of the defendant. A hearing on the petition was originally set for July 15, 1975, but on July 11 it was reset for August 17 and the trial judge ordered that any reduction would be effective as of July 15, 1975. The hearing on the modification was had on August 18, 1975. On December 12, 1975, the trial court reduced the alimony payments from *500 a month to *350 a month.",
"From that order the defendant appealed. On February 18, 1976, the trial court entered the aforementioned order providing for *750 attorney’s fees and costs on appeal and the defendant has likewise appealed from that order. The defendant contends that the refusal of the court to either terminate the alimony payments required under the decree or to reduce the same to a bare minimum was against the manifest weight of the evidence or an abuse of the discretion of the trial court. The evidence discloses that the defendant had a stroke in December 1973 and was hospitalized for 20 days. He testified that since that time he suffered various disabilities, including difficulty in walking, double vision and is unable to work full time. It was stipulated by the parties that the defendant was presently suffering from cardiac insufficiency, angina, a severe case of hypertension and heart disease. As indicated above, the alimony payments provided for in the decree were based upon the defendant’s earnings at that time of approximately *23,000 a year.",
"The evidence discloses that for the year 1974 the defendant’s income was reduced to approximately *18,000. Defendant estimated his income for the year 1975 would be between *14-15,000. The plaintiff, however, points out that this estimate does not take into consideration the fact that he is paying 25% of his gross earnings towards the purchase of a business from another insurance agent which, in effect, is a capital investment. Plaintiff also points out that he is using his home in which he resides with his second wife and is deducting as a cost of doing business the use of a portion of the premises for that purpose. The record further discloses that at the time of the hearing on the reduction of the alimony payments the plaintiff, who was unemployed at the time of the divorce, was gainfully employed as a clerk for Sears, Roebuck & Co., earning approximately *8,000 a year. Without going into detail as to the further assets of the defendant under his present marriage, we do not believe that the court abused its discretion in only reducing the monthly alimony payments from *500 to *350 a month. The parties here were married for a period of approximately 27 years and it is true the defendant’s earning capacity was and probably still is reduced, we will not substitute our opinion for that of the trial court in this regard.",
"A review of the record presented to us indicates the reduction ordered by the trial court was fair and proper based upon purported current income of the defendant at the time of the hearing on the petition for reduction of alimony payments and the current earnings of the plaintiff who had become employed subsequent to the divorce. A more interesting question is presented relative to the order of the trial court awarding the plaintiff the sum of $750 for attorney’s fees and costs to prosecute her defense of the appeal by the defendant from the order of the trial court reducing the alimony payments. There appears to be a division of authority in Illinois as to whether or not the trial court may in fact award attorney’s fees for the purpose of defending an appeal from a post-decretal order of the trial court. This is best typified by a comparison of the cases.",
"In Kinzora v. Kinzora (1976), 37 Ill. App. 3d 290, 294, 345 N.E.2d 499, 502, the Fourth District appellate court stated: “Defendant last argues that it was error for the court to award the wife attorney’s fees to defend the appeal. Unquestionably, the trial court has the right to award fees to defend on appeal. (Ill. Rev. Stat. 1973, ch. 40, par. 16; Woodshank v. Woodshank, 13 Ill. App. 3d 692, 300 N.E.2d 494. )” On the other hand the First District, in Horwitz v. Horwitz (1970), 130 Ill. App. 2d 424, 428, 264 N.E.2d 723, 725, found in considering section 15 of the Divorce Act (Ill. Rev. Stat. 1965, ch. 40, par. 16): “However, this provision by its express terms applies only to matters culminating in the original divorce decree and does not authorize an allowance of attorney’s fees to defend an appeal from a post-decretal order.",
"Therefore, the trial court erred in ordering plaintiff to pay defendant’s attorney an allowance for defense of plaintiff’s initial appeal.” See also Goldberg v. Goldberg (1st Dist. 1975), 30 Ill. App. 3d 769, 775, 332 N.E.2d 710, 715; Hall v. Hall (1975), 25 Ill. App. 3d 524, 323 N.E.2d 541. This court, in Waltrip v. Waltrip (1972), 3 Ill. App. 3d 892, 897, 279 N.E.2d 405, 409, found that: “Section 15 of the Divorce Act does not specifically limit the allowance of attorney’s fees for defense of an appeal to an appeal from the divorce decree itself 0 0 0 we believe the language used by the legislature in providing fees for defense of an appeal indicates that the legislature contemplated that such fees could be awarded on post-decretal orders as well.” See also Riddlesbarger v. Riddlesbarger (1952), 348 Ill. App. 31, 107 N.E.2d 770. We adhere to our position as set forth in Waltrip and find that under the statute in effect at the time of the hearing herein the trial court could, under proper circumstances, award attorney’s fees for the purpose of defending an appeal from a post-decretal order of the trial court. However, the question then arises as to when and under what circumstances such attorney’s fees and costs may and should be awarded.",
"The cotut in McLeod v. McLeod (1971), 133 Ill. App. 2d 111, 113, 272 N.E.2d 834, 836, stated: “As regards the separate appeal concerning attorney’s fees, there is no evidence in this record of the inability of plaintiff to pay her own attorney’s fees. It has long been the law in Illinois that in a divorce proceeding allowance of attorney’s fees is not automatic but depends upon a showing that one of the parties is financially unable to pay their own fees and that the opposing party does have such ability.” The court found that under the facts of that case that it was not an abuse of discretion for the trial court to allow attorney’s fees to the plaintiff on appeal. The question thus presents itself as to whether or not the trial court did, under the facts of the case herein, abuse its discretion in awarding attorney’s fees to the plaintiff for the purpose of defending the appeal. We believe that the awarding of attorney’s fees herein to the plaintiff was not justified.",
"Since the entry of the decree of divorce herein there is no evidence to indicate that the defendant did not at all times make the required *500 monthly alimony payments. It is to be presumed, and the record does not disclose otherwise, that the defendant has continued to make the reduced payments of *350 a month since the decree was modified. The defendant’s income has obviously been somewhat substantially reduced as evidenced by the trial court’s reduction of the amount of alimony payments and since the entry of the decree the plaintiff has become gainfully employed, earning approximately *8,000 a year.",
"Based upon the reduced alimony payments of *350 a month, she received alimony payments of *4,200, which indicates a gross income to her of *12,200 per year. On the other hand, the defendant’s income is slightly in excess of that. While we adhere to our prior ruling that attorney’s fees and costs of appeal may be awarded under proper circumstances, we do not feel that such an award in the instant case was proper. It is true that the plaintiff testified in substance that her income was not sufficient to pay for the cost of appeal but the facts indicate otherwise. The pertinent statutory authority for the awarding of attorney’s fees in divorce proceedings is found in section 15 of the Divorce Act which provided in pertinent part, at the time of the entry of the decree and the entry of the order modifying the alimony payments herein that: “ 0 ° 0 In case of appeal by the husband or wife, the court in which the decree order is rendered may grant and enforce the payment of such money for her or his defense and such equitable alimony during the pendency of the appeal as to such court shall seem reasonable and proper. * ° *” (Ill. Rev.",
"Stat. 1975, ch. 40, par. 16.) This provision of section 15 was deleted by the legislature by Public Act 79-1360, effective October 1, 1976. This change in the amended act was pointed out in a motion filed by the defendant herein which we ordered taken with the case. The plaintiff has objected thereto. The objection is not well taken as this court has authority to consider any statutory modifications applicable to the cause being considered by this court. However, in view of our decision herein that the award of attorney’s fees was improper based upon the facts presented to the trial court, we need not reach the question of whether the order entered herein could be affected by the statutory modification which took effect several months later. The order of the trial court reducing the monthly alimony payments is affirmed. The order of the trial court awarding attorney’s fees to the plaintiff for the purpose of this appeal is reversed. Affirmed in part: reversed in part. RECHENMACHER, P. J., and BOYLE, J., concur."
] | https://www.courtlistener.com/api/rest/v3/opinions/7016617/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Schedule 13G Under the Securities Exchange Act of 1934 (Amendment No.: 3 )* Name of issuer: Watts Water Technologies Inc Title of Class of Securities:Common Stock CUSIP Number:942749102 Date of Event Which Requires Filing of this Statement: December 31, 2015 Check the appropriate box to designate the rule pursuant to which this Schedule is filed: (X) Rule 13d-1(b) ( ) Rule 13d-1(c) ( ) Rule 13d-1(d) *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required in the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). (Continued on the following page(s)) 13G CUSIP No.:942749102 1.NAME OF REPORTING PERSON S.S. | [
"SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Schedule 13G Under the Securities Exchange Act of 1934 (Amendment No. : 3 )* Name of issuer: Watts Water Technologies Inc Title of Class of Securities:Common Stock CUSIP Number:942749102 Date of Event Which Requires Filing of this Statement: December 31, 2015 Check the appropriate box to designate the rule pursuant to which this Schedule is filed: (X) Rule 13d-1(b) ( ) Rule 13d-1(c) ( ) Rule 13d-1(d) *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page.",
"The information required in the remainder of this cover page shall not be deemed to be \"filed\" for the purpose of Section 18 of the Securities Exchange Act of 1934 (\"Act\") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). (Continued on the following page(s)) 13G CUSIP No. :942749102 1.NAME OF REPORTING PERSON S.S."
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
|
UNITED STATES DISTRICT COURT DISTRICT OF RHODE ISLAND
STEVEN HANSON and RANDALL PELLETIER, on behalf of themselves and all others similarly situated, Case Number: 20-cv-00232 PLAINTIFFS
v.
SCOTT R. JENSEN, in his official capacity as Director of the Rhode Island Department of Labor and Training DEFENDANT
PLAINTIFFS’ MEMORANDUM OF LAW IN SUPPORT OF MOTION FOR CLASS CERTIFICATION
PRELIMINARY STATEMENT
In this action for declaratory and injunctive relief, including a temporary restraining order,
preliminary injunction, and permanent injunction, Plaintiffs Hanson and Pelletier, on behalf of
themselves and a proposed class of similarly situated recipients of Rhode Island Unemployment
Insurance Benefits (UIB), challenge Defendant’s stoppage of UIB, as violating their rights and the
rights of the class under 42 U.S.C.§ 1983, 42 U.S.C. § 503, and implementing federal regulations,
and the Due Process Clause of the Fourteenth Amendment. These violations have resulted or will
result in the loss of UI benefits and, therefore, extreme hardship for many vulnerable individuals.
Plaintiffs move the Court for an order pursuant to Rule 23(a) and 23(b)(2) of the Federal
Rules of Civil Procedure, certifying a class consisting of the following members:
Individuals who are or at any time on or after March 1, 2020 have been eligible for Rhode Island Unemployment Insurance Benefits (UIB) and have been determined eligible for UIB by the Rhode Island Department of Labor and Training, and who, subsequent to receiving approval for the UIB and receiving at least one payment of UIB, stopped receiving UIB when due without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind, and those who in the future will have their UIB stopped without any
1 written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind.
For the reasons set forth herein, Plaintiffs respectfully request that the Court grant class
certification, designate Plaintiffs as class representatives and their undersigned counsel as class
counsel.
ARGUMENT
THE PROPOSED CLASS SHOULD BE CERTIFIED BECAUSE IT MEETS THE REQUIREMENTS OF RULE 23
Class certification is governed by Rule 23 of the Federal Rules of Civil Procedure. Under Rule
23, class certification is appropriate when the threshold requirements of Rule 23(a) are satisfied,
and one of the three subsections of Rule 23(b) has been met. Fed. R. Civ. P. 23; see also Yaffe v.
Powers, 454 F.2d 1362, 1366 (1st Cir. 1972). The First Circuit also requires that the class be
ascertainable. See In re Nexium Antitrust Litig., 777 F.3d 9, 19 (1st Cir. 2015).
Courts in this Circuit routinely certify classes of public benefits recipients and applicants
in similar cases challenging policies or practices relating to the administration of public benefits,
including UI benefits. See, e.g., Van Meter v. Harvey, 272 F.R.D. 274, 284 (D. Me. 2011)
(certifying a class of certain Medicaid recipients who are or in the future should be screened for
admission to nursing facilities); Risinger ex rel Risinger v. Concannon, 201 F.R.D. 16, 23 (D. Me.
2001) (current or future Medicaid recipients who are children regarding certain mental health
services); Curtis v. Comm’r, Me. Dep’t of Human Servs., 159 F.R.D. 339, 342 (D. Me. 1994) (Food
Stamps recipients); Febus v. Gallant, 866 F. Supp. 45, 46 (D. Mass. 1994) (public benefit
recipients, including Medicaid recipients, sent an inadequate notice); Bouchard v. Sec’y of Health
& Human Serv., 583 F. Supp. 944, 946-47 (D. Mass. 1984) (noting court had certified class of
SSI categorically eligible individuals); Giguere v. Affleck, 370 F. Supp. 154 (D.R.I. 1974)
2 (certifying a class of Food Stamps recipients); Bowen v. Hackett, 361 F. Supp. 854, 855 (D.R.I.
1973) (noting court had previously certified a class of UI benefit recipients).
The proposed class of UI recipients satisfies Rule 23(a) and Rule 23(b)(2).
1. The Proposed Class Meets the Ascertainability Requirement
The First Circuit imposes an ascertainability requirement in addition to the four factors
specifically listed in Rule 23(a). See In re Nexium, 777 F.3d at 19. The definition of the class
must be “definite,” meaning “'‘ascertainable with reference to objective criteria.’” Id., quoting
William B. Rubinstein, Newberg on Class Actions §§ 3.1, 3.3 (2013). Thus, it must be
“administratively feasible for the court to determine whether a particular individual is a member
[of the class].” Donovan v. Phillip Morris USA, Inc., 268 F.R.D. 1, 9 (D. Mass. 2010), quoting
Kent v. Sunamerica Life Ins. Co., 190 F.R.D. 271, 278 (D. Mass. 2000). In Donovan, the court
held that the two proposed criteria, first, a history of smoking at least one pack a day for twenty
years, and, second, not being under a doctor’s care for lung cancer, were both objective criteria,
noting that the defendant had an internal database of long-term customer information. Id.
Here, the proposed class satisfies the ascertainability requirement. The proposed class is made
up of:
Individuals who are or at any time on or after March 1, 2020 have been eligible for Rhode Island Unemployment Insurance Benefits (UIB) and have been determined eligible for UIB by the Rhode Island Department of Labor and Training, and who, subsequent to receiving approval for the UIB and receiving at least one payment of UIB, stopped receiving UIB when due without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind, and those who in the future will have their UIB stopped without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind.
. The class definition relies entirely on objective criteria: the status of individuals as UIB
recipients. The defendant has a database that includes all UIB recipients and identifies which
3 recipients have been terminated or suspended from receiving UIB and which identifies whether
recipients have received any written notice prior to the termination or suspension of benefits.
The identities of proposed class members are therefore already available in Defendant’s
records. See Donovan, 268 F.R.D. at 9. The proposed class is well-defined and ascertainable.
2. The Proposed Class Meets the Requirements of Rule 23(a)
Rule 23(a) sets out four requirements: “(1) the class is so numerous that joinder of all of
its members is impracticable; (2) there are questions of law or fact common to the class; (3) the
claims or defenses of the representative parties are typical of the claims or defenses of the class;
and (4) the representative parties will fairly and adequately protect the interests of the class.” Fed.
R. Civ. P. 23(a). As demonstrated below, Plaintiff satisfies these criteria.
a. The Proposed Class Satisfies the Numerosity Requirement
The numerosity requirement of Rule 23(a)(1) is satisfied when “the class is so numerous
that joinder of all of its members is impracticable.” Fed. R. Civ. P. 23(a)(1). “There is no
numerical standard as to what size class satisfies the joinder impracticality requirement,” so the
Court “must examine the facts and circumstances of the particular case…” Curtis, 159 F.R.D.
at 340. It is not necessary for the Court to determine the exact number of class members when
deciding to certify a class. McDonald v. Heckler, 612 F. Supp. 293, 300 (D. Mass. 1985)
(certifying a class relying on statistical evidence of class size). Courts may also consider
“judicial economy and the ability of the members to institute individual suits.” Curtis, 159
F.R.D. at 340.
Noting that the threshold for numerosity is “low,” the First Circuit approvingly quoted
from Stewart v. Abraham, 275 F.3d 220, 226–27 (3rd Cir. 2001): “Generally, if the named
plaintiff demonstrates that the potential number of plaintiffs exceeds 40, the first prong of Rule
4 23(a) has been met.” Garcia-Rubiera v. Calderon, 570 F.3d 443, 462 (1st Cir. 2009) (citing
Stewart); see also Van Meter, 272 F.R.D at 281 (“the figure of forty is a useful guide in
considering how many class members meet the numerosity requirement”). Courts in this circuit
have held that a number of relatively small classes and subclasses satisfied the numerosity
requirement. See, e.g., Crowe v. ExamWorks, Inc., 136 F. Supp. 3d 16, 47 (D. Mass. 2015) (class
of 47 employees is sufficiently numerous); Griffin v. Burns, 431 F. Supp. 1361, 1365 (D.R.I.
1977) (class of 123 voters is sufficiently numerous).
The instant proposed class easily satisfies the numerosity requirement. Public reports
estimate that thousands of UIB recipients have been or are being subjected to stoppage of UIB
without any notice. (https://www.abc6.com/fraud-stops-thousands-of-rhode-islanders-from-
collecting-unemployment-payments/)
Additionally, the class members are distributed across the state, making joinder
impracticable. See Wilcox v. Petit, 117 F.R.D. 314, 317 (D. Me. 1987). Further, the class
members are all UI beneficiaries, making it impracticable for them to bring individual lawsuits
to vindicate their rights. See Van Meter, 272 F.R.D. at 282 (limited financial resources of
Medicaid recipients a factor in finding individual actions impracticable); McDonald, 612 F.
Supp. at 300 (holding it was impracticable for low-income persons with disabilities to bring
individual lawsuits).
The class also includes individuals who may be injured in the future. See also Rancourt
v. Concannon, 207 F.R.D. 14, 15 (D. Me. 2002) (noting, as part of the court’s numerosity analysis,
that “the Court may also consider persons who might be injured in the future in the class”). The
proposed class satisfies the numerosity requirement.
5 b. The Proposed Class Satisfies the Commonality Requirement
The commonality requirement is satisfied when “there are questions of law or fact common
to the class.” Fed. R. Civ. P. 23(a)(2). More specifically, in order to satisfy the commonality
requirement, “claims must depend upon a common contention,” and that contention must be
“capable of a classwide resolution.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2009).
“[T]here is sufficient commonality if the ‘questions that go to the heart of the elements of the cause
of action . . . will each be answered either ‘yes’ or ‘no’ for the entire class [and] the answers will
not vary by individual class member.’” In re Celexa & Lexapro Mktg. & Sales Practice Litig., 315
F.R.D. 116, 121–22 (D. Mass. 2016) (quoting Donovan v. Philip Morris USA, Inc., 2012 U.S. Dist.
LEXIS 37974, at *21 (D. Mass. Mar. 21, 2012)).
The proposed class satisfies the commonality requirement. All members of the proposed
class have suffered or will suffer the same harms, namely, termination or suspension of UI benefits
without any notice. The harms suffered by the class members all stem from Defendant’s actions.
Finally, the rights of all members of the proposed class will be vindicated in the event of the
issuance of an injunction requiring that Defendant provide written notice. The proposed class
satisfies the commonality requirement.
c. The Proposed Class Satisfies the Typicality Requirement.
To satisfy the typicality requirement, the claims or defenses of the representative parties
must be typical of the claims or defenses of the class. Fed. R. Civ. P. 23(a)(3). The representative
parties are typical when their claims are “co-extensive with those of the unnamed class members,”
McDonald, 612 F. Supp. at 300, or when “all claims arise from the same practice or course of
conduct . . .and are based upon the same legal theory.” Wilcox, 117 F.R.D. at 318. Thus, in
Risenger, the court held that typicality was met when “Plaintiffs invoke the same Medicaid Act
6 provisions that are invoked on behalf of all class members and allege they face the same systemic
deficiencies.” 201 F.R.D. at 22.
The typicality requirement is satisfied when “the representative Plaintiff…is subject to the
same statute and policy as the class members.” Curtis, 159 F.R.D. at 341. In this action, the class
representatives and the class members are all subject to the same process—cessation of previously
approved UIB without any notice of the Department’s action, reasons, justification, or what they
can do about it.
Plaintiffs Hanson and Pelletier are typical of the class. Hanson is self-employed as a real
estate appraiser, and his treating physician advised him to stop work because he is at high risk for
Covid-19 due to his age (69) and his health condition (recent stroke and uncontrolled high blood
pressure). Hanson Declaration, ¶ 4. He applied and was approved for UIB in April 2020, and he
received his first payment on April 21, 2020. Id., ¶¶ 5, 8. His benefits stopped, and he has not
received any additional payments since then although he has recertified weekly. Id., ¶ 6, 8d. His
wife works as a nurse, and they receive Social Security benefits. They depend on his earned
income to help pay for their living expenses. Id., ¶ 10. When Plaintiff Hanson first realized that
he had not been paid, he called DLT. He waited on hold and was sometimes disconnected
automatically, and he never connected with a person, even though he waited as long as four hours
on hold. He also sent numerous emails, and he received two responses from a staff person who
did not provide any information about why his benefits were terminated or what he could do to get
them restored. Id., ¶ 9.
Plaintiff Pelletier is a seasonal worker with the National Park Service. His most recent
claim for UIB was filed on March 11, 2020, with an effective date of March 8, 2020. Pelletier
Declaration, ¶ 6. He received weekly benefits starting on or about March 24, 2020 through April
7 27, 2020. Id., ¶ 7. Although he recertified weekly, he did not receive payments on May 5, 2020
and May 12, 2020. Id., ¶ 7d. He called DLT on May 7 to find out why his benefits were not
posted, and he waited on hold for just under two and a half hours before he reached a DLT staff
person who could only tell him that his “payments have been delayed.” Id., ¶ 8. He called again
on May 12 and, after approximately fifty minutes, he reached a DLT staff person who told him
that someone would call him back. Id., ¶ 9. He did receive his weekly benefits on May 19, together
with the last two weeks, but no explanation for the delayed payment was provided. Id., ¶ 11.
Because his work is seasonal, he anticipates that he will continue to experience period of
unemployment in the future. Id., ¶ 12.
Each Plaintiff has suffered the same harm as each of the proposed absent class members –
the stoppage of their UIB without notice -- and that harm results from a common set of policies
and practices. The claims of the class representative are typical of the claims of the proposed class.
d. The Proposed Class Is Adequately Represented
The adequacy of representation requirement exists to ensure that class representatives will
fairly and adequately protect the interests of the class members. Fed. R. Civ. P. 23(a)(4). The
adequacy of representation analysis involves the consideration of two factors: (1) whether any
conflicts of interest exist between the class representatives and the class; and (2) “whether the
plaintiff’s counsel will vigorously prosecute the litigation on behalf of the class.” Curtis, 159
F.R.D. at 341; McDonald, 612 F. Supp. at 300; Wilcox, 117 F.R.D. at 318.
There is no conflict of interest between the proposed class representatives and the absent
class members. Both the individual Plaintiffs and the class members have all suffered from the
same harms, and both the individual Plaintiffs and the class members seek declaratory and
injunctive relief to ensure that Defendant remedies on-going systemic issues regarding the
8 absence of any written notice before stopping UIB. This request for relief does not present
any conflicts between or among class members.
Class counsel here is competent to represent the interests of the class. Ellen Saideman and
Lynette Labinger, cooperating counsel for the American Civil Liberties Union Foundation of
Rhode Island, are both experienced in public benefits class action litigation. They were co-counsel
in Correa v. Hawkins, 1:19-00656-JJM-PAS (D.R.I.) (putative class action challenging notices of
overpayments of SNAP benefits) and Scherwitz v. Beane, 1:18-cv-00005-WES-LDA (D.R.I.)
(putative class action challenging lack of notice when certain Medicaid benefits were terminated).
Ellen Saideman has previously litigated cases that, among other things, involved inadequate notice
under federal Medicaid law in this Court and in the Southern District of Florida, and obtained
class-wide relief for thousands of individuals. See Prado-Steiman v. Bush, 221 F.3d 1266 (11th
Cir. 2000) (class certification decision). Lynette Labinger has previously been appointed class
counsel by this Court. See, e.g., Chapdelaine v. Neronha, 15-cv-450; Cohen v. Brown University,
92-cv-197.
The class representatives and their counsel, thus, will adequately represent the proposed
class.
3. The Proposed Class Satisfies Rule 23(b)(2)
In addition to satisfying the four requirements of Rule 23(a) and the implicit
ascertainability requirement, proponents of a proposed class must satisfy one of the three
conditions listed in Rule 23(b). Fed. R. Civ. P. 23(b); Curtis, 159 F.R.D. at 341. The
proposed class seeks injunctive and declaratory relief under Rule 23(b)(2).
Rule 23 (b)(2) is satisfied when the Defendant “has acted or refused to act on grounds
that apply generally to the class, so that final injunctive relief or corresponding declaratory
9 relief is appropriate respecting the class as a whole.” Fed. R. Civ. P. 23(b)(2); see also Wal-
Mart, 564 U.S. at 360; Curtis, 159 F.R.D. at 340. Class certification pursuant to Rule 23(b)(2)
is appropriate when the predominant relief sought is injunctive or declaratory relief. “Cases
seeking declaratory or injunctive relief regarding government benefits are particularly
appropriate for class certification.” Curtis, 159 F.R.D. at 340. See also Lund v. Affleck, 388 F.
Supp. 137, 140 (D.R.I. 1975) (certifying a class of minor parents eligible for AFDC benefits
pursuant to Rule 23(b)(2)); Giguere, 370 F. Supp. 154 (certifying a class of Food Stamps
recipients pursuant to Rule 23(b)(2)).
In this action, the Defendant’s policies and practices are resulting in stoppage of UIB
without any written notice at all. All class members have suffered harm due to a policy or official
practice that “appl[ies] generally to the class.” Fed. R. Civ. P. 23(b)(2). The class seeks a
temporary restraining order and both preliminary and permanent injunctions ordering Defendant
to stop terminating or suspending the payment of UIB without notice. The proposed class satisfies
Rule 23(b)(2).
CONCLUSION
For the foregoing reasons, Plaintiffs respectfully request that, pursuant to Rule 23(a) and
(b)(2) of the Federal Rules of Civil Procedure, the Court certify the action to proceed as a class
action, designate Plaintiffs as class representatives and undersigned counsel as class counsel for
the proposed class of:
Individuals who are or at any time on or after March 1, 2020 have been eligible for Rhode Island Unemployment Insurance Benefits (UIB) and have been determined eligible for UIB by the Rhode Island Department of Labor and Training, and who, subsequent to receiving approval for the UIB and receiving at least one payment of UIB, stopped receiving UIB when due without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind, and those who in the future will have their UIB stopped without any
10 written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind.
Respectfully submitted,
/s/ Ellen Saideman
Ellen Saideman, Esq. (Bar No. 6532) Law Office of Ellen Saideman 7 Henry Drive Barrington, RI 02806 Telephone: 401.258.7276 Facsimile: 401.709.0213 Email: esaideman@yahoo.com
/s/ Lynette Labinger Lynette Labinger, Esq., (Bar No. 1645) 128 Dorrance Street, Box 710 Providence, RI 02903 Telephone: 401.465.9565 LL@labingerlaw.com
Cooperating counsel AMERICAN CIVIL LIBERTIES UNION FOUNDATION OF RHODE ISLAND
CERTIFICATE OF SERVICE
I hereby certify that I filed the within document via the ECF system on this 27th day of May, 2020 and that it is available for viewing and downloading to all counsel of record and that I provided the within document by email to:
Brenda Baum bbaum@riag.ri.gov
Miriam Weizenbaum mweizenbaum@riag.ri.gov /s/ Ellen Saideman Ellen Saideman, Esq.
11 | 2020-05-27 | [
"UNITED STATES DISTRICT COURT DISTRICT OF RHODE ISLAND STEVEN HANSON and RANDALL PELLETIER, on behalf of themselves and all others similarly situated, Case Number: 20-cv-00232 PLAINTIFFS v. SCOTT R. JENSEN, in his official capacity as Director of the Rhode Island Department of Labor and Training DEFENDANT PLAINTIFFS’ MEMORANDUM OF LAW IN SUPPORT OF MOTION FOR CLASS CERTIFICATION PRELIMINARY STATEMENT In this action for declaratory and injunctive relief, including a temporary restraining order, preliminary injunction, and permanent injunction, Plaintiffs Hanson and Pelletier, on behalf of themselves and a proposed class of similarly situated recipients of Rhode Island Unemployment Insurance Benefits (UIB), challenge Defendant’s stoppage of UIB, as violating their rights and the rights of the class under 42 U.S.C.§ 1983, 42 U.S.C. § 503, and implementing federal regulations, and the Due Process Clause of the Fourteenth Amendment. These violations have resulted or will result in the loss of UI benefits and, therefore, extreme hardship for many vulnerable individuals. Plaintiffs move the Court for an order pursuant to Rule 23(a) and 23(b)(2) of the Federal Rules of Civil Procedure, certifying a class consisting of the following members: Individuals who are or at any time on or after March 1, 2020 have been eligible for Rhode Island Unemployment Insurance Benefits (UIB) and have been determined eligible for UIB by the Rhode Island Department of Labor and Training, and who, subsequent to receiving approval for the UIB and receiving at least one payment of UIB, stopped receiving UIB when due without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind, and those who in the future will have their UIB stopped without any 1 written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind.",
"For the reasons set forth herein, Plaintiffs respectfully request that the Court grant class certification, designate Plaintiffs as class representatives and their undersigned counsel as class counsel. ARGUMENT THE PROPOSED CLASS SHOULD BE CERTIFIED BECAUSE IT MEETS THE REQUIREMENTS OF RULE 23 Class certification is governed by Rule 23 of the Federal Rules of Civil Procedure. Under Rule 23, class certification is appropriate when the threshold requirements of Rule 23(a) are satisfied, and one of the three subsections of Rule 23(b) has been met. Fed. R. Civ. P. 23; see also Yaffe v. Powers, 454 F.2d 1362, 1366 (1st Cir. 1972).",
"The First Circuit also requires that the class be ascertainable. See In re Nexium Antitrust Litig., 777 F.3d 9, 19 (1st Cir. 2015). Courts in this Circuit routinely certify classes of public benefits recipients and applicants in similar cases challenging policies or practices relating to the administration of public benefits, including UI benefits. See, e.g., Van Meter v. Harvey, 272 F.R.D. 274, 284 (D. Me. 2011) (certifying a class of certain Medicaid recipients who are or in the future should be screened for admission to nursing facilities); Risinger ex rel Risinger v. Concannon, 201 F.R.D. 16, 23 (D. Me. 2001) (current or future Medicaid recipients who are children regarding certain mental health services); Curtis v. Comm’r, Me. Dep’t of Human Servs., 159 F.R.D. 339, 342 (D. Me. 1994) (Food Stamps recipients); Febus v. Gallant, 866 F. Supp.",
"45, 46 (D. Mass. 1994) (public benefit recipients, including Medicaid recipients, sent an inadequate notice); Bouchard v. Sec’y of Health & Human Serv., 583 F. Supp. 944, 946-47 (D. Mass. 1984) (noting court had certified class of SSI categorically eligible individuals); Giguere v. Affleck, 370 F. Supp. 154 (D.R.I. 1974) 2 (certifying a class of Food Stamps recipients); Bowen v. Hackett, 361 F. Supp. 854, 855 (D.R.I. 1973) (noting court had previously certified a class of UI benefit recipients). The proposed class of UI recipients satisfies Rule 23(a) and Rule 23(b)(2).",
"1. The Proposed Class Meets the Ascertainability Requirement The First Circuit imposes an ascertainability requirement in addition to the four factors specifically listed in Rule 23(a). See In re Nexium, 777 F.3d at 19. The definition of the class must be “definite,” meaning “'‘ascertainable with reference to objective criteria.’” Id., quoting William B. Rubinstein, Newberg on Class Actions §§ 3.1, 3.3 (2013). Thus, it must be “administratively feasible for the court to determine whether a particular individual is a member [of the class].” Donovan v. Phillip Morris USA, Inc., 268 F.R.D. 1, 9 (D. Mass. 2010), quoting Kent v. Sunamerica Life Ins.",
"Co., 190 F.R.D. 271, 278 (D. Mass. 2000). In Donovan, the court held that the two proposed criteria, first, a history of smoking at least one pack a day for twenty years, and, second, not being under a doctor’s care for lung cancer, were both objective criteria, noting that the defendant had an internal database of long-term customer information. Id. Here, the proposed class satisfies the ascertainability requirement. The proposed class is made up of: Individuals who are or at any time on or after March 1, 2020 have been eligible for Rhode Island Unemployment Insurance Benefits (UIB) and have been determined eligible for UIB by the Rhode Island Department of Labor and Training, and who, subsequent to receiving approval for the UIB and receiving at least one payment of UIB, stopped receiving UIB when due without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind, and those who in the future will have their UIB stopped without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind. .",
"The class definition relies entirely on objective criteria: the status of individuals as UIB recipients. The defendant has a database that includes all UIB recipients and identifies which 3 recipients have been terminated or suspended from receiving UIB and which identifies whether recipients have received any written notice prior to the termination or suspension of benefits. The identities of proposed class members are therefore already available in Defendant’s records. See Donovan, 268 F.R.D. at 9. The proposed class is well-defined and ascertainable. 2. The Proposed Class Meets the Requirements of Rule 23(a) Rule 23(a) sets out four requirements: “(1) the class is so numerous that joinder of all of its members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class.” Fed. R. Civ. P. 23(a).",
"As demonstrated below, Plaintiff satisfies these criteria. a. The Proposed Class Satisfies the Numerosity Requirement The numerosity requirement of Rule 23(a)(1) is satisfied when “the class is so numerous that joinder of all of its members is impracticable.” Fed. R. Civ. P. 23(a)(1). “There is no numerical standard as to what size class satisfies the joinder impracticality requirement,” so the Court “must examine the facts and circumstances of the particular case…” Curtis, 159 F.R.D. at 340. It is not necessary for the Court to determine the exact number of class members when deciding to certify a class. McDonald v. Heckler, 612 F. Supp. 293, 300 (D. Mass. 1985) (certifying a class relying on statistical evidence of class size).",
"Courts may also consider “judicial economy and the ability of the members to institute individual suits.” Curtis, 159 F.R.D. at 340. Noting that the threshold for numerosity is “low,” the First Circuit approvingly quoted from Stewart v. Abraham, 275 F.3d 220, 226–27 (3rd Cir. 2001): “Generally, if the named plaintiff demonstrates that the potential number of plaintiffs exceeds 40, the first prong of Rule 4 23(a) has been met.” Garcia-Rubiera v. Calderon, 570 F.3d 443, 462 (1st Cir. 2009) (citing Stewart); see also Van Meter, 272 F.R.D at 281 (“the figure of forty is a useful guide in considering how many class members meet the numerosity requirement”). Courts in this circuit have held that a number of relatively small classes and subclasses satisfied the numerosity requirement. See, e.g., Crowe v. ExamWorks, Inc., 136 F. Supp. 3d 16, 47 (D. Mass.",
"2015) (class of 47 employees is sufficiently numerous); Griffin v. Burns, 431 F. Supp. 1361, 1365 (D.R.I. 1977) (class of 123 voters is sufficiently numerous). The instant proposed class easily satisfies the numerosity requirement. Public reports estimate that thousands of UIB recipients have been or are being subjected to stoppage of UIB without any notice. (https://www.abc6.com/fraud-stops-thousands-of-rhode-islanders-from- collecting-unemployment-payments/) Additionally, the class members are distributed across the state, making joinder impracticable. See Wilcox v. Petit, 117 F.R.D. 314, 317 (D. Me. 1987). Further, the class members are all UI beneficiaries, making it impracticable for them to bring individual lawsuits to vindicate their rights.",
"See Van Meter, 272 F.R.D. at 282 (limited financial resources of Medicaid recipients a factor in finding individual actions impracticable); McDonald, 612 F. Supp. at 300 (holding it was impracticable for low-income persons with disabilities to bring individual lawsuits). The class also includes individuals who may be injured in the future. See also Rancourt v. Concannon, 207 F.R.D. 14, 15 (D. Me. 2002) (noting, as part of the court’s numerosity analysis, that “the Court may also consider persons who might be injured in the future in the class”). The proposed class satisfies the numerosity requirement. 5 b. The Proposed Class Satisfies the Commonality Requirement The commonality requirement is satisfied when “there are questions of law or fact common to the class.” Fed.",
"R. Civ. P. 23(a)(2). More specifically, in order to satisfy the commonality requirement, “claims must depend upon a common contention,” and that contention must be “capable of a classwide resolution.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2009). “[T]here is sufficient commonality if the ‘questions that go to the heart of the elements of the cause of action . . . will each be answered either ‘yes’ or ‘no’ for the entire class [and] the answers will not vary by individual class member.’” In re Celexa & Lexapro Mktg. & Sales Practice Litig., 315 F.R.D.",
"116, 121–22 (D. Mass. 2016) (quoting Donovan v. Philip Morris USA, Inc., 2012 U.S. Dist. LEXIS 37974, at *21 (D. Mass. Mar. 21, 2012)). The proposed class satisfies the commonality requirement. All members of the proposed class have suffered or will suffer the same harms, namely, termination or suspension of UI benefits without any notice. The harms suffered by the class members all stem from Defendant’s actions. Finally, the rights of all members of the proposed class will be vindicated in the event of the issuance of an injunction requiring that Defendant provide written notice. The proposed class satisfies the commonality requirement. c. The Proposed Class Satisfies the Typicality Requirement. To satisfy the typicality requirement, the claims or defenses of the representative parties must be typical of the claims or defenses of the class. Fed. R. Civ.",
"P. 23(a)(3). The representative parties are typical when their claims are “co-extensive with those of the unnamed class members,” McDonald, 612 F. Supp. at 300, or when “all claims arise from the same practice or course of conduct . . .and are based upon the same legal theory.” Wilcox, 117 F.R.D. at 318. Thus, in Risenger, the court held that typicality was met when “Plaintiffs invoke the same Medicaid Act 6 provisions that are invoked on behalf of all class members and allege they face the same systemic deficiencies.” 201 F.R.D. at 22.",
"The typicality requirement is satisfied when “the representative Plaintiff…is subject to the same statute and policy as the class members.” Curtis, 159 F.R.D. at 341. In this action, the class representatives and the class members are all subject to the same process—cessation of previously approved UIB without any notice of the Department’s action, reasons, justification, or what they can do about it. Plaintiffs Hanson and Pelletier are typical of the class. Hanson is self-employed as a real estate appraiser, and his treating physician advised him to stop work because he is at high risk for Covid-19 due to his age (69) and his health condition (recent stroke and uncontrolled high blood pressure). Hanson Declaration, ¶ 4.",
"He applied and was approved for UIB in April 2020, and he received his first payment on April 21, 2020. Id., ¶¶ 5, 8. His benefits stopped, and he has not received any additional payments since then although he has recertified weekly. Id., ¶ 6, 8d. His wife works as a nurse, and they receive Social Security benefits. They depend on his earned income to help pay for their living expenses. Id., ¶ 10. When Plaintiff Hanson first realized that he had not been paid, he called DLT. He waited on hold and was sometimes disconnected automatically, and he never connected with a person, even though he waited as long as four hours on hold. He also sent numerous emails, and he received two responses from a staff person who did not provide any information about why his benefits were terminated or what he could do to get them restored. Id., ¶ 9.",
"Plaintiff Pelletier is a seasonal worker with the National Park Service. His most recent claim for UIB was filed on March 11, 2020, with an effective date of March 8, 2020. Pelletier Declaration, ¶ 6. He received weekly benefits starting on or about March 24, 2020 through April 7 27, 2020. Id., ¶ 7. Although he recertified weekly, he did not receive payments on May 5, 2020 and May 12, 2020. Id., ¶ 7d. He called DLT on May 7 to find out why his benefits were not posted, and he waited on hold for just under two and a half hours before he reached a DLT staff person who could only tell him that his “payments have been delayed.” Id., ¶ 8. He called again on May 12 and, after approximately fifty minutes, he reached a DLT staff person who told him that someone would call him back.",
"Id., ¶ 9. He did receive his weekly benefits on May 19, together with the last two weeks, but no explanation for the delayed payment was provided. Id., ¶ 11. Because his work is seasonal, he anticipates that he will continue to experience period of unemployment in the future. Id., ¶ 12. Each Plaintiff has suffered the same harm as each of the proposed absent class members – the stoppage of their UIB without notice -- and that harm results from a common set of policies and practices. The claims of the class representative are typical of the claims of the proposed class. d. The Proposed Class Is Adequately Represented The adequacy of representation requirement exists to ensure that class representatives will fairly and adequately protect the interests of the class members.",
"Fed. R. Civ. P. 23(a)(4). The adequacy of representation analysis involves the consideration of two factors: (1) whether any conflicts of interest exist between the class representatives and the class; and (2) “whether the plaintiff’s counsel will vigorously prosecute the litigation on behalf of the class.” Curtis, 159 F.R.D. at 341; McDonald, 612 F. Supp. at 300; Wilcox, 117 F.R.D. at 318. There is no conflict of interest between the proposed class representatives and the absent class members. Both the individual Plaintiffs and the class members have all suffered from the same harms, and both the individual Plaintiffs and the class members seek declaratory and injunctive relief to ensure that Defendant remedies on-going systemic issues regarding the 8 absence of any written notice before stopping UIB. This request for relief does not present any conflicts between or among class members. Class counsel here is competent to represent the interests of the class.",
"Ellen Saideman and Lynette Labinger, cooperating counsel for the American Civil Liberties Union Foundation of Rhode Island, are both experienced in public benefits class action litigation. They were co-counsel in Correa v. Hawkins, 1:19-00656-JJM-PAS (D.R.I.) (putative class action challenging notices of overpayments of SNAP benefits) and Scherwitz v. Beane, 1:18-cv-00005-WES-LDA (D.R.I.) (putative class action challenging lack of notice when certain Medicaid benefits were terminated). Ellen Saideman has previously litigated cases that, among other things, involved inadequate notice under federal Medicaid law in this Court and in the Southern District of Florida, and obtained class-wide relief for thousands of individuals. See Prado-Steiman v. Bush, 221 F.3d 1266 (11th Cir. 2000) (class certification decision). Lynette Labinger has previously been appointed class counsel by this Court.",
"See, e.g., Chapdelaine v. Neronha, 15-cv-450; Cohen v. Brown University, 92-cv-197. The class representatives and their counsel, thus, will adequately represent the proposed class. 3. The Proposed Class Satisfies Rule 23(b)(2) In addition to satisfying the four requirements of Rule 23(a) and the implicit ascertainability requirement, proponents of a proposed class must satisfy one of the three conditions listed in Rule 23(b). Fed. R. Civ. P. 23(b); Curtis, 159 F.R.D. at 341. The proposed class seeks injunctive and declaratory relief under Rule 23(b)(2).",
"Rule 23 (b)(2) is satisfied when the Defendant “has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory 9 relief is appropriate respecting the class as a whole.” Fed. R. Civ. P. 23(b)(2); see also Wal- Mart, 564 U.S. at 360; Curtis, 159 F.R.D. at 340. Class certification pursuant to Rule 23(b)(2) is appropriate when the predominant relief sought is injunctive or declaratory relief. “Cases seeking declaratory or injunctive relief regarding government benefits are particularly appropriate for class certification.” Curtis, 159 F.R.D. at 340. See also Lund v. Affleck, 388 F. Supp. 137, 140 (D.R.I. 1975) (certifying a class of minor parents eligible for AFDC benefits pursuant to Rule 23(b)(2)); Giguere, 370 F. Supp. 154 (certifying a class of Food Stamps recipients pursuant to Rule 23(b)(2)). In this action, the Defendant’s policies and practices are resulting in stoppage of UIB without any written notice at all.",
"All class members have suffered harm due to a policy or official practice that “appl[ies] generally to the class.” Fed. R. Civ. P. 23(b)(2). The class seeks a temporary restraining order and both preliminary and permanent injunctions ordering Defendant to stop terminating or suspending the payment of UIB without notice. The proposed class satisfies Rule 23(b)(2). CONCLUSION For the foregoing reasons, Plaintiffs respectfully request that, pursuant to Rule 23(a) and (b)(2) of the Federal Rules of Civil Procedure, the Court certify the action to proceed as a class action, designate Plaintiffs as class representatives and undersigned counsel as class counsel for the proposed class of: Individuals who are or at any time on or after March 1, 2020 have been eligible for Rhode Island Unemployment Insurance Benefits (UIB) and have been determined eligible for UIB by the Rhode Island Department of Labor and Training, and who, subsequent to receiving approval for the UIB and receiving at least one payment of UIB, stopped receiving UIB when due without any written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind, and those who in the future will have their UIB stopped without any 10 written advance notice, or any written notice concurrent with the stoppage of UIB or any individualized notice of any kind.",
"Respectfully submitted, /s/ Ellen Saideman Ellen Saideman, Esq. (Bar No. 6532) Law Office of Ellen Saideman 7 Henry Drive Barrington, RI 02806 Telephone: 401.258.7276 Facsimile: 401.709.0213 Email: esaideman@yahoo.com /s/ Lynette Labinger Lynette Labinger, Esq., (Bar No. 1645) 128 Dorrance Street, Box 710 Providence, RI 02903 Telephone: 401.465.9565 LL@labingerlaw.com Cooperating counsel AMERICAN CIVIL LIBERTIES UNION FOUNDATION OF RHODE ISLAND CERTIFICATE OF SERVICE I hereby certify that I filed the within document via the ECF system on this 27th day of May, 2020 and that it is available for viewing and downloading to all counsel of record and that I provided the within document by email to: Brenda Baum bbaum@riag.ri.gov Miriam Weizenbaum mweizenbaum@riag.ri.gov /s/ Ellen Saideman Ellen Saideman, Esq.",
"11"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/159633258/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
1. Claims 1-5, 11, and 21 is/are rejected under 35 U.S.C. 103 as being unpatentable over Harada (US 2009/021339) in view of Namekawa et al. (US 2005/0175388). Regarding to claim 1: Harada teaches an inkjet printer comprising: a printer body (FIG. 1, element 26); a waste ink container (FIG. 2, element 46) including a first engagement portion (FIG. 2, element 92); and a cover member (FIG. 2, element 36) configured to constitute a part of a housing of the inkjet printer (element 2), the cover member including a second engagement portion (FIG. 2, element 93) corresponding with the first engagement portion (FIG. 2, element 92). Harada however does not teach wherein the second engagement portion configured to interlock with the first engagement portion. Namekawa et al. teaches a printing apparatus comprising an unit container (FIG. 25, element 80) and a cover member (FIG. 25, element 28), where the unit container and the cover member having first FIGs. 25-26, elements 83c-d and 28b-c are interlocked shown in FIG. 26 (column 20, lines 30-45)). Therefore, it would have been obvious for one having ordinary skill in the art at the time of the filing date to modify Harada’s printing apparatus to structure the engagement between the waste ink container and the cover member in the interlock manner as disclosed by Namekawa et al., since such structure is well known in the art of attaching/detaching an unit to/from a main body and also taught by Namekawa et al. (FIG. 13). Harada also teaches the following claim inventions: Regarding to claims 2-5: wherein when the waste ink container and the cover member (FIG. 1, element 36) are attached to the printer body, an outer surface of the cover member is flush with an outer surface of the printer body, wherein material of the cover member is the same as material of an outer casing (FIG. 1, element 26) of the printer body, wherein surface treatment of the cover member is the same as surface treatment of the outer casing of the printer body, wherein a color of the cover member is the same as a color of the outer casing of the printer body (The color, the material, and the surface treatment of the cover member does not distinct the prior art printing device from the claimed printing apparatus. Such features of the cover member are considered just as design choice, in fact). Regarding to claims 11, 21: wherein the waste ink container is positioned on a corner of the inkjet printer (FIG. 1: The corner of the printing apparatus where the cover 36 is), wherein an exterior of the housing defines an opening configured to receive the waste ink container, and wherein the cover member includes an outer surface that matches the shape and size of the opening (FIG. 1). Allowable Subject Matter 2. Claims 13 and 22 are allowed over prior art. Claim 12 is objected to as being dependent upon a rejected base claim, but would be allowable if rewritten in independent form including all of the limitations of the base claim and any intervening claims. Regarding to claims 12-13: The primary reasons for the indication of the allowability of the claims is the inclusions therein, in combination as currently claimed, of the limitation that wherein the waste ink container and the cover member are integrally detachable from the outer casing when the first engagement portion is engaged with the second engagement portion is neither disclosed nor taught by the cited prior art of record, alone or in combination. Claim 22 is allowed because they depend directly/indirectly on claim 13. Conclusion THIS ACTION IS MADE FINAL. Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the mailing date of this final action. Any inquiry concerning this communication or earlier communications from the examiner should be directed to LAM S NGUYEN whose telephone number is (571)272-2151. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, MATTHEW LUU, can be reached on 571-272-7663. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.
/LAM S NGUYEN/ Primary Examiner, Art Unit 2853 | 2021-10-26T07:10:47 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains.",
"Patentability shall not be negated by the manner in which the invention was made. 1. Claims 1-5, 11, and 21 is/are rejected under 35 U.S.C. 103 as being unpatentable over Harada (US 2009/021339) in view of Namekawa et al. (US 2005/0175388). Regarding to claim 1: Harada teaches an inkjet printer comprising: a printer body (FIG. 1, element 26); a waste ink container (FIG. 2, element 46) including a first engagement portion (FIG. 2, element 92); and a cover member (FIG. 2, element 36) configured to constitute a part of a housing of the inkjet printer (element 2), the cover member including a second engagement portion (FIG. 2, element 93) corresponding with the first engagement portion (FIG. 2, element 92). Harada however does not teach wherein the second engagement portion configured to interlock with the first engagement portion.",
"Namekawa et al. teaches a printing apparatus comprising an unit container (FIG. 25, element 80) and a cover member (FIG. 25, element 28), where the unit container and the cover member having first FIGs. 25-26, elements 83c-d and 28b-c are interlocked shown in FIG. 26 (column 20, lines 30-45)). Therefore, it would have been obvious for one having ordinary skill in the art at the time of the filing date to modify Harada’s printing apparatus to structure the engagement between the waste ink container and the cover member in the interlock manner as disclosed by Namekawa et al., since such structure is well known in the art of attaching/detaching an unit to/from a main body and also taught by Namekawa et al.",
"(FIG. 13). Harada also teaches the following claim inventions: Regarding to claims 2-5: wherein when the waste ink container and the cover member (FIG. 1, element 36) are attached to the printer body, an outer surface of the cover member is flush with an outer surface of the printer body, wherein material of the cover member is the same as material of an outer casing (FIG. 1, element 26) of the printer body, wherein surface treatment of the cover member is the same as surface treatment of the outer casing of the printer body, wherein a color of the cover member is the same as a color of the outer casing of the printer body (The color, the material, and the surface treatment of the cover member does not distinct the prior art printing device from the claimed printing apparatus.",
"Such features of the cover member are considered just as design choice, in fact). Regarding to claims 11, 21: wherein the waste ink container is positioned on a corner of the inkjet printer (FIG. 1: The corner of the printing apparatus where the cover 36 is), wherein an exterior of the housing defines an opening configured to receive the waste ink container, and wherein the cover member includes an outer surface that matches the shape and size of the opening (FIG. 1). Allowable Subject Matter 2. Claims 13 and 22 are allowed over prior art.",
"Claim 12 is objected to as being dependent upon a rejected base claim, but would be allowable if rewritten in independent form including all of the limitations of the base claim and any intervening claims. Regarding to claims 12-13: The primary reasons for the indication of the allowability of the claims is the inclusions therein, in combination as currently claimed, of the limitation that wherein the waste ink container and the cover member are integrally detachable from the outer casing when the first engagement portion is engaged with the second engagement portion is neither disclosed nor taught by the cited prior art of record, alone or in combination.",
"Claim 22 is allowed because they depend directly/indirectly on claim 13. Conclusion THIS ACTION IS MADE FINAL. Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the mailing date of this final action. Any inquiry concerning this communication or earlier communications from the examiner should be directed to LAM S NGUYEN whose telephone number is (571)272-2151. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, MATTHEW LUU, can be reached on 571-272-7663. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.",
"/LAM S NGUYEN/ Primary Examiner, Art Unit 2853"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-10-31.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Citation Nr: 1025227
Decision Date: 07/07/10 Archive Date: 07/19/10
DOCKET NO. 08-39 754 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office in Indianapolis,
Indiana
THE ISSUES
1. Entitlement to an initial evaluation in excess of 30 percent
for posttraumatic stress disorder (PTSD), prior to June 30, 2009.
2. Entitlement to an initial staged evaluation in excess of 50
percent for PTSD, from June 30, 2009.
3. Entitlement to a total disability rating based on individual
unemployability (TDIU).
REPRESENTATION
Appellant represented by: Teena Petro, Agent
ATTORNEY FOR THE BOARD
C. M. Powell, Counsel
INTRODUCTION
The Veteran had essentially continuous active service from
November 1961 to May 1970.
This matter comes before the Board of Veterans' Appeals (BVA or
Board) from an April 2007 rating decision of the Department of
Veterans Affairs (VA), Regional Office (RO) in Indianapolis,
Indiana which, in pertinent part, granted service connection for
PTSD and assigned a 30 percent evaluation, effective December 13,
2005. Subsequently, in a December 2009 rating decision, the RO
increased the evaluation for the Veteran's PTSD to 50 percent
disabling, effective June 30, 2009. Thereafter, in a statement
received on December 28, 2009, the Veteran indicated that wished
to continue with his appeal in spite of the RO's increase in his
evaluation from 30 percent to 50 percent disabling.
The issue of entitlement to TDIU is addressed in the REMAND
portion of the decision below and is REMANDED to the RO via the
Appeals Management Center (AMC), in Washington, DC.
FINDINGS OF FACT
1. For the period from December 13, 2005 through June 29, 2009,
the competent clinical evidence demonstrates that the Veteran's
PTSD was manifested by depression, anxiety, hypervigilence,
nightmares, sleep impairment, low energy, intrusive thought,
flashbacks, survivor's guilt, difficulty concentrating, and
social withdrawal, with Global Assessment of Functioning (GAF)
scores of between 35 and 61.
2. For the period from June 30, 2009, the competent clinical
evidence demonstrates that the Veteran's PTSD has been manifested
by depression, anxiety, hypervigilence, nightmares, sleep
impairment, low energy, intrusive thought, flashbacks, survivor's
guilt, difficulty concentrating, and social withdrawal, with a
GAF score of 41.
CONCLUSIONS OF LAW
1. The criteria for an initial evaluation of 50 percent, but no
higher, for PTSD, for the period from December 13, 2005 through
June 29, 2009, have been met. 38 U.S.C.A. § 1155 (West 2002); 38
C.F.R. § 4.130, Diagnostic Codes 9411 (2009).
2. The criteria for an initial evaluation in excess of 50
percent for PTSD, from June 30, 2009, have not been met. 38
U.S.C.A. § 1155 (West 2002); 38 C.F.R. § 4.130, Diagnostic Codes
9411 (2009).
REASONS AND BASES FOR FINDINGS AND CONCLUSIONS
VCAA
The Veterans Claims Assistance Act of 2000 (VCAA) describes VA's
duty to notify and assist claimants in substantiating a claim for
VA benefits. 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5107, 5126
(West 2002 & Supp. 2005); 38 C.F.R. §§ 3.102, 3.156(a), 3.159 and
3.326(a) (2009).
Upon receipt of a complete or substantially complete application
for benefits, VA is required to notify the claimant and his or
her representative, if any, of any information, and any medical
or lay evidence, that is necessary to substantiate the claim. 38
U.S.C.A. § 5103(a) (West 2002); 38 C.F.R. § 3.159(b) (2009);
Quartuccio v. Principi, 16 Vet. App. 183 (2002). Proper VCAA
notice must inform the claimant of any information and evidence
not of record (1) that is necessary to substantiate the claim;
(2) that VA will seek to provide; (3) that the claimant is
expected to provide; and (4) must ask the claimant to provide any
evidence in her or his possession that pertains to the claim in
accordance with 38 C.F.R. § 3.159(b)(1). VCAA notice should be
provided to a claimant before the initial unfavorable agency of
original jurisdiction (AOJ) decision on a claim. Pelegrini v.
Principi, 18 Vet. App. 112 (2004); Mayfield v. Nicholson, 444
F.3d 1328 (Fed. Cir. 2006).
On March 3, 2006, the United States Court of Appeals for Veterans
Claims (Court) issued its decision in the consolidated appeal of
Dingess/Hartman v. Nicholson, 19 Vet. App. 473 (2006). The Court
in Dingess/Hartman holds that the VCAA notice requirements of
38 U.S.C. § 5103(a) and 38 C.F.R. § 3.159(b) apply to all five
elements of a "service connection" claim. As previously
defined by the courts, those five elements include: (1) veteran
status; (2) existence of a disability; (3) a connection between
the veteran's service and the disability; (4) degree of
disability; and (5) effective date of the disability. Upon
receipt of an application for "service connection," therefore,
the Department of Veterans Affairs (VA) is required to review the
information and the evidence presented with the claim and to
provide the claimant with notice of what information and evidence
not previously provided, if any, will assist in substantiating or
is necessary to substantiate the elements of the claim as
reasonably contemplated by the application. This includes notice
that a disability rating and an effective date for the award of
benefits will be assigned if service connection is awarded.
Because the Court's decision is premised on the five elements of
a service connection claim, it is the consensus opinion within
the VA that the analysis employed can be analogously applied to
any matter that involves any one of the five elements of a
"service connection" claim, to include an increased rating
claim.
In the present case, with respect to the Veteran's claim for a
higher initial evaluation for PTSD, the April 2007 rating
decision granted the Veteran's claim of entitlement to service
connection for PTSD, and such claim is now substantiated. As
such, his filing of a notice of disagreement as to the initial
rating assigned does not trigger additional notice obligations
under 38 U.S.C.A. § 5103(a). 38 C.F.R. § 3.159(b)(3) (2009).
Rather, the Veteran's appeal as to the initial rating assignment
here triggers VA's statutory duties under 38 U.S.C.A. §§ 5104 and
7105, as well as regulatory duties under 38 C.F.R. § 3.103. As a
consequence, VA is only required to advise the Veteran of what is
necessary to obtain the maximum benefit allowed by the evidence
and the law. In this regard, a May 2008 letter as well as an
October 2008 Statement of the Case, under the heading "Pertinent
Laws; Regulations; Rating Schedule Provisions," set forth the
relevant diagnostic codes (DC) for evaluating a mental disorder,
and included a description of the rating formulas under that
diagnostic code. Thus, the appellant has been informed of what
was needed to achieve a higher schedular rating. Therefore, the
Board finds that the appellant has been informed of what was
necessary to achieve a higher evaluation for his service-
connected PTSD.
With regard to the duty to assist, the claims file contains the
Veteran's service treatment records, VA and private treatment
record, and VA examination reports. Additionally, the claims
file contains the Veteran's statements in support of his claim.
The Board has carefully reviewed such statements and concludes
that he has not identified further evidence not already of
record. The Board has also perused the medical records for
references to additional treatment reports not of record, but has
found nothing to suggest that there is any outstanding evidence
with respect to the Veteran's claim.
The record reflects that the Veteran was afforded VA examinations
in April 2006 and June 2009. To that end, when VA undertakes to
provide a VA examination or obtain a VA opinion, it must ensure
that the examination or opinion is adequate. Barr v. Nicholson,
21 Vet. App. 303, 312 (2007). The Board finds that the VA
examinations obtained were more than adequate because the
examiners elicited substantial information regarding the
Veteran's medical history and symptoms and completed objective
examinations of him which provided information relevant to the
Diagnostic Codes rating criteria. Accordingly, the Board finds
that VA's duty to assist with respect to obtaining a VA
examination or opinion with respect to the issue on appeal has
been met. 38 C.F.R. § 3.159(c)(4).
Thus, based on the foregoing, the Board finds that all relevant
facts have been properly and sufficiently developed in this
appeal and no further development is required to comply with the
duty to assist the veteran in developing the facts pertinent to
his claim. Essentially, all available evidence that could
substantiate the claim has been obtained
Legal Criteria
The Board has reviewed all of the evidence in the Veteran's
claims file, with an emphasis on the medical evidence for the
rating period on appeal. Although the Board has an obligation to
provide reasons and bases supporting this decision, there is no
need to discuss, in detail, the extensive evidence of record.
Indeed, the Federal Circuit has held that the Board must review
the entire record, but does not have to discuss each piece of
evidence. Gonzales v. West, 218 F.3d 1378, 1380-81 (Fed. Cir.
2000). Therefore, the Board will summarize the relevant evidence
where appropriate, and the Board's analysis below will focus
specifically on what the evidence shows, or fails to show, as to
the claim.
Disability evaluations are determined by the application of a
schedule of ratings, which is based on average impairment of
earning capacity. Separate diagnostic codes identify the various
disabilities. 38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. Part 4
(2009).
Where there is a question as to which of two evaluations shall be
applied, the higher evaluation will be assigned if the disability
more closely approximates the criteria required for that rating.
Otherwise, the lower rating will be assigned. 38 C.F.R. § 4.7
(2009).
When, after careful consideration of all procurable and assembled
data, a reasonable doubt arises regarding the degree of
disability, such doubt will be resolved in favor of the claimant.
38 U.S.C.A. § 5107 (West 2002); 38 C.F.R. §§ 3.102, 4.3 (2009).
In determining the level of impairment, the disability must be
considered in the context of the whole recorded history. 38
C.F.R. § 4.2, 4.41 (2009). An evaluation of the level of
disability present also includes consideration of the functional
impairment of the appellant's ability to engage in ordinary
activities, including employment. 38 C.F.R. § 4.10 (2009).
In a claim for a greater original rating after an initial award
of service connection, all of the evidence submitted in support
of the veteran's claim is to be considered.
In initial rating cases, separate ratings can be assigned for
separate periods of time based on the facts found, a practice
known as "staged" ratings. See Fenderson v. West, 12 Vet. App.
119 (1999); 38 C.F.R. § 4.2 (2007); Hart v. Mansfield, 21 Vet.
App. 505 (2007).
In determining the disability evaluation, VA has a duty to
acknowledge and consider all regulations that are potentially
applicable based upon the assertions and issues raised in the
record and to explain the reasons and bases for its conclusion.
Schafrath v. Derwinski, 1 Vet. App. 589 (1991).
Ratings shall be based as far as practicable, upon the average
impairments of earning capacity with the additional proviso that
the Secretary shall from time to time readjust this schedule of
ratings in accordance with experience. To accord justice,
therefore, to the exceptional case where the schedular
evaluations are found to be inadequate, an extra-schedular
evaluation commensurate with the average earning capacity
impairment due exclusively to the service-connected disability or
disabilities may be assigned where the case presents such an
exceptional or unusual disability picture with such related
factors as marked interference with employment or frequent
periods of hospitalization as to render impractical the
application of the regular schedular standards. 38 C.F.R.
§ 3.321(b)(1) (2009).
When all of the evidence is assembled, VA is then responsible for
determining whether the evidence supports the claim or is in
relative equipoise, with the veteran prevailing in either event,
or whether a fair preponderance of the evidence is against the
claim, in which case the claim is denied. Gilbert v. Derwinski,
1 Vet. App. 49, 55 (1990).
The Secretary shall consider all information and lay and medical
evidence of record in a case before the Secretary with respect to
benefits under laws administered by the Secretary. When, after
consideration of all of the evidence and material of record in an
appropriate case before VA, there is an approximate balance of
positive and negative evidence regarding the merits of an issue
material to the determination of the matter, the Secretary shall
give the benefit of the doubt to the claimant. 38 U.S.C.A. §
5107; Alemany v. Brown, 9 Vet. App. 518, 519 (1996).
Under the General Rating Formula for Mental Disorders, 38 C.F.R.
§ 4.130, Diagnostic Codes 9411, a 30 percent evaluation
contemplates PTSD manifested by occupational and social
impairment with occasional decrease in work efficiency and
intermittent periods of inability to perform occupational tasks,
although generally functioning satisfactorily, with routine
behavior, self-care, and normal conversation, due to such
symptoms as: depressed mood, anxiety, suspiciousness, weekly or
less often panic attacks, chronic sleep impairment, mild memory
loss, such as forgetting names, directions, recent events.
A 50 percent requires occupational and social impairment with
reduced reliability and productivity due to such symptoms as:
flattened affect; circumstantial, circumlocutory, stereotyped
speech; panic attacks more than once a week; difficulty in
understanding complex commands; impairment of short- and long-
term memory (e.g., retention of only highly learned material,
forgetting to complete task); impaired judgment; impaired
abstract thinking; disturbances of motivation and mood; and
difficulty in establishing and maintaining effective work and
social relationships.
A 70 percent rating is warranted for occupational and social
impairment with deficiencies in most areas, such as work, school,
family relationships, judgment, thinking or mood, due to such
symptoms as: suicidal ideation; obsessional rituals that
interfere with routine activities; speech intermittently
illogical, obscure, or irrelevant; near-continuous panic or
depression affecting ability to function independently,
appropriately and effectively; impaired impulse control (such as
unprovoked irritability with periods of violence); spatial
disorientation; neglect of personal appearance and hygiene;
difficulty in adapting to stressful circumstances (including work
or a work-like setting); and inability to establish and maintain
effective relationships.
The maximum rating of 100 percent requires total occupational and
social impairment due to such symptoms as: grossly inappropriate
behavior; persistent danger of hurting self or others;
intermittent inability to perform activities of daily living
(including maintenance of minimal personal hygiene);
disorientation to time or place; and memory loss for names of
close relatives, own occupation, or own name. Id.
According to DSM-IV, a GAF score of 71 to 80 indicates the
examinee has, if at all, symptoms that are transient or
expectable reactions to psychosocial stressors but no more than
slight impairment in social, occupational or school functioning.
A GAF score of 61 to 70 indicates the examinee has some mild
symptoms or some difficulty in social, occupational, or school
functioning, but generally functions pretty well with some
meaningful interpersonal relationships. A GAF score of 51 to 60
indicates the examinee has moderate symptoms or moderate
difficulty in social, occupational, or school functioning. A GAF
score of 41 to 50 indicates the examinee has serious symptoms or
a serious impairment in social, occupational, or school
functioning. A GAF score of 31 to 40 indicates the examinee has
some impairment in reality testing or communication or major
impairment in several areas, such as work or school. A GAF score
of 21 to 30 indicates that the examinee's behavior is
considerably influenced by delusions or hallucinations, has
serious impairment in communication or judgment, or is unable to
function in almost all areas of life. See Quick Reference to the
Diagnostic Criteria from DSM-IV, 46-47 (1994).
Legal Analysis
The record reflects that service connection has been established
for PTSD, effective from December 13, 2005. Subsequently, in a
December 2009 rating decision, the RO assigned the Veteran's PTSD
a 50 percent evaluation effective from June 30, 2009. Therefore,
the analysis below will address both periods.
1. Prior to June 30, 2009
Such disability is currently assigned a 30 percent evaluation
under 38 C.F.R. § 4.130, Diagnostic Codes 9411.
The record establishes that the Veteran's mental health has been
evaluated on numerous occasions, including on VA examination,
between 2005 and 2009. During this time examiners described the
Veteran's personal hygiene as good, average, well-groomed, and/or
appropriately dressed. Examiners also reported that the Veteran
was oriented to time, person, and place, had normal, relevant,
coherent, logical and goal-directed thought processes and speech
patterns, normal, fluent, and well-articulated speech, fair to
good concentration, fair to adequate insight and judgment, intact
cognition, and memory that was good, fair, and/or normal.
Examiners also reported that the Veteran denied experiencing
suicidal or homicidal thoughts, hallucinations, delusions, panic
attacks, obsessive/ritualistic behavior, history of
assaultiveness or violence, or history of suicide attempts.
However, during this time, examiners reported that the Veteran
was depressed, had anxiety, had a flat affect, and was
hypervigilant. The Veteran also indicated that he experienced
sleep impairment, nightmares, intrusive thoughts, flashbacks,
poor appetite, low energy, lack of motivation, survivor's guilt,
forgetfulness, and difficulty concentrating.
With respect to occupational functioning, the April 2006 VA
examination report shows that the Veteran reported that he had
not worked since August 2004, at which time his truck driver's
license was revoked due to a history of treatment for seizures.
As a result of losing his license, the Veteran, who had been the
owner and operator of his own trucking company, declared
bankruptcy in 2005 as a result of the loss of his trucking
company and job. A March 2008 private treatment record notes
that the Veteran complained of nightmares almost every night
regarding Vietnam. The examiner indicated that the Veteran's
sleep impairment impacted the Veteran in that he was no longer
able to work due to not getting recuperative sleep at night.
The record also demonstrates that the Veteran has been receiving
Social Security Disability benefits since November 2004 as a
result of affective disorders and anxiety related disorders.
With respect to social functioning, the April 2006 VA examination
report shows that the Veteran indicated that he had close and
loving relationships with his current wife, whom he married in
1970, his son from his first marriage, with whom he spoke one to
two times a month, his two children from his second marriage, who
he saw several times a week, and his grandchildren. The Veteran
further reported that he had belonged to the Masonic Lodge for 30
years, he was a 32nd degree Mason, he was a Shriner and belonged
to the Indianapolis Lodge, where he had a few friends. The
Veteran also indicated that he enjoyed playing crossword puzzles
for hours at a time as well as solitaire. However, the Veteran
indicated that he was less active than when he drove his truck
all over the country and that he and his wife went out for dinner
and breakfast less than what they had during the prior year.
Subsequent private treatment records, including psychological
evaluations dated in April 2006, November 2007, and March 2008
show that the Veteran reported that he did not socialize with
anyone anymore, including with friends and that he no longer had
outside relationships with anyone. The Veteran also indicated
that he only trusted his immediate family and no one else. The
Veteran's wife also reported that he did not interact with her
very much at all.
With respect to an objective assessment of the Veteran's
psychiatric symptomatology, the April 2006 VA examination report
shows that the examiner, who assigned such symptomatology a GAF
score of 61, indicated that:
Much of [the Veteran's] psychosocial
dysfunction appears to result from his
unexpected loss of his trucking company,
his employment, and a subsequent bankruptcy
and early retirement...Prognosis for the
Veteran is fair, given the significant
nature of his recent losses, including his
own corporation, his primary profession as
a truck driver, and resulting bankruptcy.
However, in April 2006 and November 2007 private examiners
assigned the Veteran's PTSD symptomatology GAF scores of 35, 36,
38, and, indicated that the Veteran's PTSD was chronic and
severe.
The April 2006 VA examiner's findings, and the April 2006,
November 2007, and March 2008 private examiners' findings, and
the Veteran's documented GAF scores of between 35 and 61, which
demonstrate symptomatology that ranges from mild, to moderate
social, occupational or school functioning, to reflective of some
impairment in reality testing or communication, more nearly
approximate the criteria required under Diagnostic Code 9411 for
an increased 50 percent evaluation.
The Board, for the reasons stated below, finds that an evaluation
greater than 50 percent is not warranted as the competent
clinical evidence of record does not establish that the Veteran's
current symptomology most nearly approximate the criteria
necessary for the next higher, 70 percent, evaluation.
In this regard, although the Veteran experiences depression,
there is no evidence that such condition affects his ability to
function independently, appropriately, or effectively. Indeed,
the record demonstrates that the Veteran was able to function
independently and appropriately. The Board acknowledges that the
record demonstrates that the Veteran experienced suicidal
ideations, however the record reflects that such ideations are
only passive and there is no evidence that he has any current
intent or plan. Additionally, as the record demonstrates that
Veteran was always reportedly appropriately dressed with
average/fair hygiene and grooming, there is no evidence that he
neglected his personal appearance and hygiene. Additionally, the
evidence does not demonstrate that the Veteran's speech was
intermittently illogical, obscure, or irrelevant or that he
experiences near-continuous panic or spatial disorientation.
Further, the record shows that the Veteran repeatedly denied a
history of assaultiveness and there is no other evidence that the
Veteran experiences impaired impulse control.
The Board does acknowledge that the Veteran is socially isolative
and has withdrawn from his family and friends. However, the
Board finds that such social impairment is contemplated in the
increased, 50 percent evaluation.
Therefore, in light of the clinical findings of record, the Board
finds that the 50 percent disability evaluation granted in this
decision will adequately compensate the Veteran for the
occupational and social impairment that he experiences as a
result of his PTSD symptomatology for the period prior to June
30, 2009. The Board has resolved all reasonable doubt in the
Veteran's favor and has considered whether a higher evaluation
can be granted under other potentially applicable diagnostic
codes. However, the preponderance of the evidence is against
assignment of a higher evaluation for the period from December
13, 2005 through June 29, 2009.
2. From June 30, 2009
For the period from June 30, 2009, the Veteran is assigned a 50
percent evaluation. The only evidence of record for this period,
a June 2009 VA examination report, does not demonstrate that the
Veteran is entitled to a higher evaluation. In this regard, the
examiner from such report indicated that the Veteran's hygiene
appeared normal. The examiner also indicated that the Veteran
was oriented to date, month, year, place, city, and person, but
was not oriented to day. The examiner also indicated that the
Veteran did not have impaired control or obsessive or ritualistic
behavior, had fair judgment, maintained good abstract thinking,
logical and coherent speech (although halting at times) and
thought processes, normal cognition, and did not have difficulty
understanding complex commands. The examiner also reported that
the Veteran denied experiencing hallucinations, delusions,
obsessive/ritualistic behavior, or history of assaultiveness or
violence.
However, the examiner also reported that the Veteran experienced
flattened affect, intrusive dreams of the war, decreased
sleeping, intrusive thoughts, increased startle response,
hypervigilence, decreased motivation, decreased social
interaction on a daily basis, mild cognitive impairment in terms
of mild difficulties with recent memory, reduced mental
flexibility, disturbances of motivation and mood, and difficulty
maintaining social relationships. The examiner also indicated
that the Veteran had infrequent panic attacks and fleeting
thoughts of suicide but with no plan of acting on them.
Overall, the examiner indicated that "the
Veteran's world has reduced in scope
considerably. He has much fewer interests
and essential[ly] just sits in a room all
day not doing anything. He has some
minimal interaction with his wife and his
daughter, but he is more receptive of their
care than giving to them. He is able to
take care of his own basic hygiene. He
stated he can clean up messes in the home
[i]f one is apparent, but otherwise he does
not do much around the house. His physical
health appears to be stable, but his
interpersonal relationships, as well as
recreation or leisure pursuits are sorely
lacking. ... While his initial unemployment
was due to physical concerns, the Veteran
reported being totally uninterested in
occupational pursuits. He does not
participate in volunteering or any other
community-based activities that retired
people might participate in. There are no
other disorders that independently explain
the patient's impairment. The Veteran is
likely cognitively able to manage his
benefits, but is unmotivated to do so and
defers this responsibility to his wife.
The examiner, who indicated that the Veteran's symptoms produces
clinically significant distress and impairment and social and
occupational functioning, assigned the Veteran a GAF score of 41,
which she indicated was mostly due to the fact that the Veteran
had very limited social interactions, nearly none, and attributes
his not working to lack of motivation in addition to having been
involuntarily retired due to his history of seizures.
Based on the clinical evidence of record, the Board finds that
the Veteran's PTSD symptomatology is most reflective of the
currently assigned 50 percent evaluation and not the next
highest, 70 percent evaluation. In this regard, although the
Veteran experiences depression and had one panic attack, there is
no evidence that such conditions affect his ability to function
independently, appropriately, or effectively. Indeed, although
the record shows that the Veteran has reported feeling
unmotivated to perform tasks, there is no evidence that he cannot
independently, appropriately, or effectively do so. His
decreased motivation is contemplated in his current 50 percent
rating. The record demonstrates that on mental status
examination, the Veteran did not display inappropriate behavior.
The Veteran also reported that he was able to clean up messes in
his home and he was cognitively able to manage his own affairs.
The Board acknowledges that the record demonstrates that the
Veteran experienced suicidal ideations, however the record
reflects that such ideations are only passive and there is no
evidence that he has any current intent or plan. Additionally,
as the record demonstrates that Veteran reported that he was able
to maintain his personal hygiene and the examiner reported that
the Veteran's hygiene appeared normal, there is no evidence that
he neglected his personal appearance and hygiene. Further, the
evidence does not demonstrate that the Veteran's speech was
intermittently illogical, obscure, or irrelevant. Rather, the
examiner indicated that the Veteran had fair judgment, maintained
good abstract thinking, logical and coherent speech and thought
processes, normal cognition, and did not have difficulty
understanding complex commands. Additionally, the Veteran denied
a history of impaired control or obsessive or ritualistic
behavior or a history of assaultiveness. The Board does
acknowledge that the Veteran is socially withdrawn. However, the
Board finds that such social impairment is contemplated in the
currently assigned 50 percent evaluation.
In conclusion, the Board finds that the preponderance of the
evidence is against an evaluation in excess of 50 percent for the
period from June 30, 2005. Although the Veteran asserts that he
is entitled to an increased evaluation for his service-connected
PTSD, he is not a licensed medical practitioner and is not
competent to offer medical opinions. Grottveit v. Brown, 5 Vet.
App. 91 (1993); Espiritu v. Derwinski, 2 Vet. App. 492 (1992).
Further, although the Board finds the Veteran credible in
reporting his symptoms, such are consistent with the current 50
percent rating. Accordingly, the Board finds that the medical
findings on clinical evaluation are of greater probative value
than the Veteran's statements regarding the severity of his PTSD.
Therefore, based on the medical evidence of record, the Board
concludes that for the period from June 30, 2005, the Veteran's
overall disability picture more nearly approximates the criteria
for the currently assigned 50 percent evaluation. As a result,
the Board finds that the preponderance of the evidence is against
an evaluation in excess of 50 percent for the Veteran's PTSD for
the period from June 30, 2005 and the claim must be denied.
Extraschedular Consideration
The Board is required to address the issue of entitlement to an
extraschedular rating under 38 C.F.R. § 3.321 only in cases where
the issue is expressly raised by the claimant or the record
before the Board contains evidence of "exceptional or unusual"
circumstances indicating that the rating schedule may be
inadequate to compensate for the average impairment of earning
capacity due to the disability. See VA O.G.C. Prec. Op. 6-96
(August 16, 1996). In this case, consideration of an
extraschedular rating has not been expressly raised. Further,
the record before the Board does not contain evidence of
"exceptional or unusual" circumstances that would preclude the
use of the regular rating schedule. 38 C.F.R. § 3.321 (2009).
ORDER
Entitlement to an initial evaluation of 50 percent, but no
higher, for PTSD, for the period from December 13, 2005 through
June 29, 2009, is granted, subject to the applicable law
governing the award of monetary benefits.
Entitlement to an initial evaluation in excess of 50 percent for
PTSD, for the period from June 30, 2009, is denied.
REMAND
The Board finds that statements contained in the record,
including in the December 2009 VA examination report, can be
construed as raising the issue of entitlement to TDIU. See
Roberson v. Principi, 251 F.3d 1378, 1384 (Fed. Cir. 2001) (once
a veteran submits evidence of medical disability and additionally
submits evidence of unemployability, VA must consider total
rating for compensation based upon individual unemployability).
The U.S. Court of Appeals for Veterans Claims recently held that
a request for TDIU is not a separate claim for benefits, but
rather involves an attempt to obtain an appropriate rating for a
disability or disabilities, either as part of the initial
adjudication of a claim or, if a disability upon which
entitlement to TDIU is based has already been found to be service
connected, as part of a claim for increased compensation. Rice
v. Shinseki, 22 Vet. App. 447, 453 (2009). If the claimant or
the record reasonably raises the question of whether the Veteran
is unemployable due to the disability for which an increased
rating is sought, then part and parcel to that claim for an
increased rating is whether a total rating based on individual
unemployability as a result of that disability is warranted. Id
at 455. As the RO has not yet considered whether the Veteran is
entitled to TDIU, the issue must be remanded to the RO for
consideration.
Accordingly, the case is remanded for the following action:
1. The RO must provide the Veteran with a
letter satisfying VA's duties to notify and
assist, pursuant to VCAA, with respect to
his claim of entitlement to TDIU. The
Veteran should be requested to complete a
provided VA Form, 21-8940, Veteran's
Application for Increased Compensation
Based on Unemployability.
2. The Veteran should be afforded a VA
examination to determine the effect of the
Veteran's service-connected disabilities,
in combination, on his ability to work.
The examiner should describe what types of
employment activities are limited because
of the Veteran's service-connected
disabilities, and what type of employment,
if any, is feasible given his functional
impairment. Finally, the examiner should
provide an opinion as to whether the
Veteran's service-connected disabilities,
in combination, render him unable to obtain
or maintain substantially gainful
employment.
The claims folder, including a copy of this
Remand, should be reviewed in conjunction
with such examination and the examination
reports should indicate that such a review
was performed. All opinions expressed
should be accompanied by complete
rationales.
3. The RO must then adjudicate the issue
of entitlement to a TDIU. If the claim
remains denied, the Veteran and his
attorney must be provided a Statement of
the Case. Only if the Veteran submits a
timely substantive appeal as to the issue,
should it be returned to the Board for
appellate review.
The appellant has the right to submit additional evidence and
argument on the matter the Board has remanded. Kutscherousky v.
West, 12 Vet. App. 369 (1999).
______________________________________________
U. R. POWELL
Veterans Law Judge, Board of Veterans' Appeals
Department of Veterans Affairs | 07-07-2010 | [
"Citation Nr: 1025227 Decision Date: 07/07/10 Archive Date: 07/19/10 DOCKET NO. 08-39 754 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Indianapolis, Indiana THE ISSUES 1. Entitlement to an initial evaluation in excess of 30 percent for posttraumatic stress disorder (PTSD), prior to June 30, 2009. 2. Entitlement to an initial staged evaluation in excess of 50 percent for PTSD, from June 30, 2009. 3. Entitlement to a total disability rating based on individual unemployability (TDIU). REPRESENTATION Appellant represented by: Teena Petro, Agent ATTORNEY FOR THE BOARD C. M. Powell, Counsel INTRODUCTION The Veteran had essentially continuous active service from November 1961 to May 1970. This matter comes before the Board of Veterans' Appeals (BVA or Board) from an April 2007 rating decision of the Department of Veterans Affairs (VA), Regional Office (RO) in Indianapolis, Indiana which, in pertinent part, granted service connection for PTSD and assigned a 30 percent evaluation, effective December 13, 2005. Subsequently, in a December 2009 rating decision, the RO increased the evaluation for the Veteran's PTSD to 50 percent disabling, effective June 30, 2009. Thereafter, in a statement received on December 28, 2009, the Veteran indicated that wished to continue with his appeal in spite of the RO's increase in his evaluation from 30 percent to 50 percent disabling.",
"The issue of entitlement to TDIU is addressed in the REMAND portion of the decision below and is REMANDED to the RO via the Appeals Management Center (AMC), in Washington, DC. FINDINGS OF FACT 1. For the period from December 13, 2005 through June 29, 2009, the competent clinical evidence demonstrates that the Veteran's PTSD was manifested by depression, anxiety, hypervigilence, nightmares, sleep impairment, low energy, intrusive thought, flashbacks, survivor's guilt, difficulty concentrating, and social withdrawal, with Global Assessment of Functioning (GAF) scores of between 35 and 61. 2. For the period from June 30, 2009, the competent clinical evidence demonstrates that the Veteran's PTSD has been manifested by depression, anxiety, hypervigilence, nightmares, sleep impairment, low energy, intrusive thought, flashbacks, survivor's guilt, difficulty concentrating, and social withdrawal, with a GAF score of 41. CONCLUSIONS OF LAW 1. The criteria for an initial evaluation of 50 percent, but no higher, for PTSD, for the period from December 13, 2005 through June 29, 2009, have been met. 38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. § 4.130, Diagnostic Codes 9411 (2009). 2.",
"The criteria for an initial evaluation in excess of 50 percent for PTSD, from June 30, 2009, have not been met. 38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. § 4.130, Diagnostic Codes 9411 (2009). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS VCAA The Veterans Claims Assistance Act of 2000 (VCAA) describes VA's duty to notify and assist claimants in substantiating a claim for VA benefits. 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5107, 5126 (West 2002 & Supp. 2005); 38 C.F.R. §§ 3.102, 3.156(a), 3.159 and 3.326(a) (2009). Upon receipt of a complete or substantially complete application for benefits, VA is required to notify the claimant and his or her representative, if any, of any information, and any medical or lay evidence, that is necessary to substantiate the claim. 38 U.S.C.A. § 5103(a) (West 2002); 38 C.F.R. § 3.159(b) (2009); Quartuccio v. Principi, 16 Vet. App. 183 (2002).",
"Proper VCAA notice must inform the claimant of any information and evidence not of record (1) that is necessary to substantiate the claim; (2) that VA will seek to provide; (3) that the claimant is expected to provide; and (4) must ask the claimant to provide any evidence in her or his possession that pertains to the claim in accordance with 38 C.F.R. § 3.159(b)(1). VCAA notice should be provided to a claimant before the initial unfavorable agency of original jurisdiction (AOJ) decision on a claim. Pelegrini v. Principi, 18 Vet. App. 112 (2004); Mayfield v. Nicholson, 444 F.3d 1328 (Fed. Cir. 2006). On March 3, 2006, the United States Court of Appeals for Veterans Claims (Court) issued its decision in the consolidated appeal of Dingess/Hartman v. Nicholson, 19 Vet. App. 473 (2006). The Court in Dingess/Hartman holds that the VCAA notice requirements of 38 U.S.C. § 5103(a) and 38 C.F.R. § 3.159(b) apply to all five elements of a \"service connection\" claim.",
"As previously defined by the courts, those five elements include: (1) veteran status; (2) existence of a disability; (3) a connection between the veteran's service and the disability; (4) degree of disability; and (5) effective date of the disability. Upon receipt of an application for \"service connection,\" therefore, the Department of Veterans Affairs (VA) is required to review the information and the evidence presented with the claim and to provide the claimant with notice of what information and evidence not previously provided, if any, will assist in substantiating or is necessary to substantiate the elements of the claim as reasonably contemplated by the application. This includes notice that a disability rating and an effective date for the award of benefits will be assigned if service connection is awarded.",
"Because the Court's decision is premised on the five elements of a service connection claim, it is the consensus opinion within the VA that the analysis employed can be analogously applied to any matter that involves any one of the five elements of a \"service connection\" claim, to include an increased rating claim. In the present case, with respect to the Veteran's claim for a higher initial evaluation for PTSD, the April 2007 rating decision granted the Veteran's claim of entitlement to service connection for PTSD, and such claim is now substantiated. As such, his filing of a notice of disagreement as to the initial rating assigned does not trigger additional notice obligations under 38 U.S.C.A. § 5103(a). 38 C.F.R.",
"§ 3.159(b)(3) (2009). Rather, the Veteran's appeal as to the initial rating assignment here triggers VA's statutory duties under 38 U.S.C.A. §§ 5104 and 7105, as well as regulatory duties under 38 C.F.R. § 3.103. As a consequence, VA is only required to advise the Veteran of what is necessary to obtain the maximum benefit allowed by the evidence and the law.",
"In this regard, a May 2008 letter as well as an October 2008 Statement of the Case, under the heading \"Pertinent Laws; Regulations; Rating Schedule Provisions,\" set forth the relevant diagnostic codes (DC) for evaluating a mental disorder, and included a description of the rating formulas under that diagnostic code. Thus, the appellant has been informed of what was needed to achieve a higher schedular rating. Therefore, the Board finds that the appellant has been informed of what was necessary to achieve a higher evaluation for his service- connected PTSD. With regard to the duty to assist, the claims file contains the Veteran's service treatment records, VA and private treatment record, and VA examination reports. Additionally, the claims file contains the Veteran's statements in support of his claim. The Board has carefully reviewed such statements and concludes that he has not identified further evidence not already of record. The Board has also perused the medical records for references to additional treatment reports not of record, but has found nothing to suggest that there is any outstanding evidence with respect to the Veteran's claim.",
"The record reflects that the Veteran was afforded VA examinations in April 2006 and June 2009. To that end, when VA undertakes to provide a VA examination or obtain a VA opinion, it must ensure that the examination or opinion is adequate. Barr v. Nicholson, 21 Vet. App. 303, 312 (2007). The Board finds that the VA examinations obtained were more than adequate because the examiners elicited substantial information regarding the Veteran's medical history and symptoms and completed objective examinations of him which provided information relevant to the Diagnostic Codes rating criteria. Accordingly, the Board finds that VA's duty to assist with respect to obtaining a VA examination or opinion with respect to the issue on appeal has been met. 38 C.F.R.",
"§ 3.159(c)(4). Thus, based on the foregoing, the Board finds that all relevant facts have been properly and sufficiently developed in this appeal and no further development is required to comply with the duty to assist the veteran in developing the facts pertinent to his claim. Essentially, all available evidence that could substantiate the claim has been obtained Legal Criteria The Board has reviewed all of the evidence in the Veteran's claims file, with an emphasis on the medical evidence for the rating period on appeal. Although the Board has an obligation to provide reasons and bases supporting this decision, there is no need to discuss, in detail, the extensive evidence of record. Indeed, the Federal Circuit has held that the Board must review the entire record, but does not have to discuss each piece of evidence.",
"Gonzales v. West, 218 F.3d 1378, 1380-81 (Fed. Cir. 2000). Therefore, the Board will summarize the relevant evidence where appropriate, and the Board's analysis below will focus specifically on what the evidence shows, or fails to show, as to the claim. Disability evaluations are determined by the application of a schedule of ratings, which is based on average impairment of earning capacity. Separate diagnostic codes identify the various disabilities. 38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. Part 4 (2009). Where there is a question as to which of two evaluations shall be applied, the higher evaluation will be assigned if the disability more closely approximates the criteria required for that rating.",
"Otherwise, the lower rating will be assigned. 38 C.F.R. § 4.7 (2009). When, after careful consideration of all procurable and assembled data, a reasonable doubt arises regarding the degree of disability, such doubt will be resolved in favor of the claimant. 38 U.S.C.A. § 5107 (West 2002); 38 C.F.R. §§ 3.102, 4.3 (2009). In determining the level of impairment, the disability must be considered in the context of the whole recorded history. 38 C.F.R. § 4.2, 4.41 (2009). An evaluation of the level of disability present also includes consideration of the functional impairment of the appellant's ability to engage in ordinary activities, including employment.",
"38 C.F.R. § 4.10 (2009). In a claim for a greater original rating after an initial award of service connection, all of the evidence submitted in support of the veteran's claim is to be considered. In initial rating cases, separate ratings can be assigned for separate periods of time based on the facts found, a practice known as \"staged\" ratings. See Fenderson v. West, 12 Vet. App. 119 (1999); 38 C.F.R. § 4.2 (2007); Hart v. Mansfield, 21 Vet. App.",
"505 (2007). In determining the disability evaluation, VA has a duty to acknowledge and consider all regulations that are potentially applicable based upon the assertions and issues raised in the record and to explain the reasons and bases for its conclusion. Schafrath v. Derwinski, 1 Vet. App. 589 (1991). Ratings shall be based as far as practicable, upon the average impairments of earning capacity with the additional proviso that the Secretary shall from time to time readjust this schedule of ratings in accordance with experience. To accord justice, therefore, to the exceptional case where the schedular evaluations are found to be inadequate, an extra-schedular evaluation commensurate with the average earning capacity impairment due exclusively to the service-connected disability or disabilities may be assigned where the case presents such an exceptional or unusual disability picture with such related factors as marked interference with employment or frequent periods of hospitalization as to render impractical the application of the regular schedular standards.",
"38 C.F.R. § 3.321(b)(1) (2009). When all of the evidence is assembled, VA is then responsible for determining whether the evidence supports the claim or is in relative equipoise, with the veteran prevailing in either event, or whether a fair preponderance of the evidence is against the claim, in which case the claim is denied. Gilbert v. Derwinski, 1 Vet. App. 49, 55 (1990). The Secretary shall consider all information and lay and medical evidence of record in a case before the Secretary with respect to benefits under laws administered by the Secretary. When, after consideration of all of the evidence and material of record in an appropriate case before VA, there is an approximate balance of positive and negative evidence regarding the merits of an issue material to the determination of the matter, the Secretary shall give the benefit of the doubt to the claimant. 38 U.S.C.A.",
"§ 5107; Alemany v. Brown, 9 Vet. App. 518, 519 (1996). Under the General Rating Formula for Mental Disorders, 38 C.F.R. § 4.130, Diagnostic Codes 9411, a 30 percent evaluation contemplates PTSD manifested by occupational and social impairment with occasional decrease in work efficiency and intermittent periods of inability to perform occupational tasks, although generally functioning satisfactorily, with routine behavior, self-care, and normal conversation, due to such symptoms as: depressed mood, anxiety, suspiciousness, weekly or less often panic attacks, chronic sleep impairment, mild memory loss, such as forgetting names, directions, recent events. A 50 percent requires occupational and social impairment with reduced reliability and productivity due to such symptoms as: flattened affect; circumstantial, circumlocutory, stereotyped speech; panic attacks more than once a week; difficulty in understanding complex commands; impairment of short- and long- term memory (e.g., retention of only highly learned material, forgetting to complete task); impaired judgment; impaired abstract thinking; disturbances of motivation and mood; and difficulty in establishing and maintaining effective work and social relationships. A 70 percent rating is warranted for occupational and social impairment with deficiencies in most areas, such as work, school, family relationships, judgment, thinking or mood, due to such symptoms as: suicidal ideation; obsessional rituals that interfere with routine activities; speech intermittently illogical, obscure, or irrelevant; near-continuous panic or depression affecting ability to function independently, appropriately and effectively; impaired impulse control (such as unprovoked irritability with periods of violence); spatial disorientation; neglect of personal appearance and hygiene; difficulty in adapting to stressful circumstances (including work or a work-like setting); and inability to establish and maintain effective relationships.",
"The maximum rating of 100 percent requires total occupational and social impairment due to such symptoms as: grossly inappropriate behavior; persistent danger of hurting self or others; intermittent inability to perform activities of daily living (including maintenance of minimal personal hygiene); disorientation to time or place; and memory loss for names of close relatives, own occupation, or own name. Id. According to DSM-IV, a GAF score of 71 to 80 indicates the examinee has, if at all, symptoms that are transient or expectable reactions to psychosocial stressors but no more than slight impairment in social, occupational or school functioning. A GAF score of 61 to 70 indicates the examinee has some mild symptoms or some difficulty in social, occupational, or school functioning, but generally functions pretty well with some meaningful interpersonal relationships. A GAF score of 51 to 60 indicates the examinee has moderate symptoms or moderate difficulty in social, occupational, or school functioning. A GAF score of 41 to 50 indicates the examinee has serious symptoms or a serious impairment in social, occupational, or school functioning. A GAF score of 31 to 40 indicates the examinee has some impairment in reality testing or communication or major impairment in several areas, such as work or school. A GAF score of 21 to 30 indicates that the examinee's behavior is considerably influenced by delusions or hallucinations, has serious impairment in communication or judgment, or is unable to function in almost all areas of life.",
"See Quick Reference to the Diagnostic Criteria from DSM-IV, 46-47 (1994). Legal Analysis The record reflects that service connection has been established for PTSD, effective from December 13, 2005. Subsequently, in a December 2009 rating decision, the RO assigned the Veteran's PTSD a 50 percent evaluation effective from June 30, 2009. Therefore, the analysis below will address both periods. 1. Prior to June 30, 2009 Such disability is currently assigned a 30 percent evaluation under 38 C.F.R.",
"§ 4.130, Diagnostic Codes 9411. The record establishes that the Veteran's mental health has been evaluated on numerous occasions, including on VA examination, between 2005 and 2009. During this time examiners described the Veteran's personal hygiene as good, average, well-groomed, and/or appropriately dressed. Examiners also reported that the Veteran was oriented to time, person, and place, had normal, relevant, coherent, logical and goal-directed thought processes and speech patterns, normal, fluent, and well-articulated speech, fair to good concentration, fair to adequate insight and judgment, intact cognition, and memory that was good, fair, and/or normal. Examiners also reported that the Veteran denied experiencing suicidal or homicidal thoughts, hallucinations, delusions, panic attacks, obsessive/ritualistic behavior, history of assaultiveness or violence, or history of suicide attempts. However, during this time, examiners reported that the Veteran was depressed, had anxiety, had a flat affect, and was hypervigilant. The Veteran also indicated that he experienced sleep impairment, nightmares, intrusive thoughts, flashbacks, poor appetite, low energy, lack of motivation, survivor's guilt, forgetfulness, and difficulty concentrating.",
"With respect to occupational functioning, the April 2006 VA examination report shows that the Veteran reported that he had not worked since August 2004, at which time his truck driver's license was revoked due to a history of treatment for seizures. As a result of losing his license, the Veteran, who had been the owner and operator of his own trucking company, declared bankruptcy in 2005 as a result of the loss of his trucking company and job. A March 2008 private treatment record notes that the Veteran complained of nightmares almost every night regarding Vietnam.",
"The examiner indicated that the Veteran's sleep impairment impacted the Veteran in that he was no longer able to work due to not getting recuperative sleep at night. The record also demonstrates that the Veteran has been receiving Social Security Disability benefits since November 2004 as a result of affective disorders and anxiety related disorders. With respect to social functioning, the April 2006 VA examination report shows that the Veteran indicated that he had close and loving relationships with his current wife, whom he married in 1970, his son from his first marriage, with whom he spoke one to two times a month, his two children from his second marriage, who he saw several times a week, and his grandchildren. The Veteran further reported that he had belonged to the Masonic Lodge for 30 years, he was a 32nd degree Mason, he was a Shriner and belonged to the Indianapolis Lodge, where he had a few friends. The Veteran also indicated that he enjoyed playing crossword puzzles for hours at a time as well as solitaire.",
"However, the Veteran indicated that he was less active than when he drove his truck all over the country and that he and his wife went out for dinner and breakfast less than what they had during the prior year. Subsequent private treatment records, including psychological evaluations dated in April 2006, November 2007, and March 2008 show that the Veteran reported that he did not socialize with anyone anymore, including with friends and that he no longer had outside relationships with anyone. The Veteran also indicated that he only trusted his immediate family and no one else. The Veteran's wife also reported that he did not interact with her very much at all. With respect to an objective assessment of the Veteran's psychiatric symptomatology, the April 2006 VA examination report shows that the examiner, who assigned such symptomatology a GAF score of 61, indicated that: Much of [the Veteran's] psychosocial dysfunction appears to result from his unexpected loss of his trucking company, his employment, and a subsequent bankruptcy and early retirement...Prognosis for the Veteran is fair, given the significant nature of his recent losses, including his own corporation, his primary profession as a truck driver, and resulting bankruptcy. However, in April 2006 and November 2007 private examiners assigned the Veteran's PTSD symptomatology GAF scores of 35, 36, 38, and, indicated that the Veteran's PTSD was chronic and severe. The April 2006 VA examiner's findings, and the April 2006, November 2007, and March 2008 private examiners' findings, and the Veteran's documented GAF scores of between 35 and 61, which demonstrate symptomatology that ranges from mild, to moderate social, occupational or school functioning, to reflective of some impairment in reality testing or communication, more nearly approximate the criteria required under Diagnostic Code 9411 for an increased 50 percent evaluation.",
"The Board, for the reasons stated below, finds that an evaluation greater than 50 percent is not warranted as the competent clinical evidence of record does not establish that the Veteran's current symptomology most nearly approximate the criteria necessary for the next higher, 70 percent, evaluation. In this regard, although the Veteran experiences depression, there is no evidence that such condition affects his ability to function independently, appropriately, or effectively. Indeed, the record demonstrates that the Veteran was able to function independently and appropriately. The Board acknowledges that the record demonstrates that the Veteran experienced suicidal ideations, however the record reflects that such ideations are only passive and there is no evidence that he has any current intent or plan. Additionally, as the record demonstrates that Veteran was always reportedly appropriately dressed with average/fair hygiene and grooming, there is no evidence that he neglected his personal appearance and hygiene.",
"Additionally, the evidence does not demonstrate that the Veteran's speech was intermittently illogical, obscure, or irrelevant or that he experiences near-continuous panic or spatial disorientation. Further, the record shows that the Veteran repeatedly denied a history of assaultiveness and there is no other evidence that the Veteran experiences impaired impulse control. The Board does acknowledge that the Veteran is socially isolative and has withdrawn from his family and friends. However, the Board finds that such social impairment is contemplated in the increased, 50 percent evaluation. Therefore, in light of the clinical findings of record, the Board finds that the 50 percent disability evaluation granted in this decision will adequately compensate the Veteran for the occupational and social impairment that he experiences as a result of his PTSD symptomatology for the period prior to June 30, 2009. The Board has resolved all reasonable doubt in the Veteran's favor and has considered whether a higher evaluation can be granted under other potentially applicable diagnostic codes.",
"However, the preponderance of the evidence is against assignment of a higher evaluation for the period from December 13, 2005 through June 29, 2009. 2. From June 30, 2009 For the period from June 30, 2009, the Veteran is assigned a 50 percent evaluation. The only evidence of record for this period, a June 2009 VA examination report, does not demonstrate that the Veteran is entitled to a higher evaluation. In this regard, the examiner from such report indicated that the Veteran's hygiene appeared normal. The examiner also indicated that the Veteran was oriented to date, month, year, place, city, and person, but was not oriented to day. The examiner also indicated that the Veteran did not have impaired control or obsessive or ritualistic behavior, had fair judgment, maintained good abstract thinking, logical and coherent speech (although halting at times) and thought processes, normal cognition, and did not have difficulty understanding complex commands.",
"The examiner also reported that the Veteran denied experiencing hallucinations, delusions, obsessive/ritualistic behavior, or history of assaultiveness or violence. However, the examiner also reported that the Veteran experienced flattened affect, intrusive dreams of the war, decreased sleeping, intrusive thoughts, increased startle response, hypervigilence, decreased motivation, decreased social interaction on a daily basis, mild cognitive impairment in terms of mild difficulties with recent memory, reduced mental flexibility, disturbances of motivation and mood, and difficulty maintaining social relationships. The examiner also indicated that the Veteran had infrequent panic attacks and fleeting thoughts of suicide but with no plan of acting on them. Overall, the examiner indicated that \"the Veteran's world has reduced in scope considerably. He has much fewer interests and essential[ly] just sits in a room all day not doing anything. He has some minimal interaction with his wife and his daughter, but he is more receptive of their care than giving to them. He is able to take care of his own basic hygiene. He stated he can clean up messes in the home [i]f one is apparent, but otherwise he does not do much around the house. His physical health appears to be stable, but his interpersonal relationships, as well as recreation or leisure pursuits are sorely lacking.",
"... While his initial unemployment was due to physical concerns, the Veteran reported being totally uninterested in occupational pursuits. He does not participate in volunteering or any other community-based activities that retired people might participate in. There are no other disorders that independently explain the patient's impairment. The Veteran is likely cognitively able to manage his benefits, but is unmotivated to do so and defers this responsibility to his wife. The examiner, who indicated that the Veteran's symptoms produces clinically significant distress and impairment and social and occupational functioning, assigned the Veteran a GAF score of 41, which she indicated was mostly due to the fact that the Veteran had very limited social interactions, nearly none, and attributes his not working to lack of motivation in addition to having been involuntarily retired due to his history of seizures. Based on the clinical evidence of record, the Board finds that the Veteran's PTSD symptomatology is most reflective of the currently assigned 50 percent evaluation and not the next highest, 70 percent evaluation. In this regard, although the Veteran experiences depression and had one panic attack, there is no evidence that such conditions affect his ability to function independently, appropriately, or effectively.",
"Indeed, although the record shows that the Veteran has reported feeling unmotivated to perform tasks, there is no evidence that he cannot independently, appropriately, or effectively do so. His decreased motivation is contemplated in his current 50 percent rating. The record demonstrates that on mental status examination, the Veteran did not display inappropriate behavior. The Veteran also reported that he was able to clean up messes in his home and he was cognitively able to manage his own affairs. The Board acknowledges that the record demonstrates that the Veteran experienced suicidal ideations, however the record reflects that such ideations are only passive and there is no evidence that he has any current intent or plan.",
"Additionally, as the record demonstrates that Veteran reported that he was able to maintain his personal hygiene and the examiner reported that the Veteran's hygiene appeared normal, there is no evidence that he neglected his personal appearance and hygiene. Further, the evidence does not demonstrate that the Veteran's speech was intermittently illogical, obscure, or irrelevant. Rather, the examiner indicated that the Veteran had fair judgment, maintained good abstract thinking, logical and coherent speech and thought processes, normal cognition, and did not have difficulty understanding complex commands. Additionally, the Veteran denied a history of impaired control or obsessive or ritualistic behavior or a history of assaultiveness.",
"The Board does acknowledge that the Veteran is socially withdrawn. However, the Board finds that such social impairment is contemplated in the currently assigned 50 percent evaluation. In conclusion, the Board finds that the preponderance of the evidence is against an evaluation in excess of 50 percent for the period from June 30, 2005. Although the Veteran asserts that he is entitled to an increased evaluation for his service-connected PTSD, he is not a licensed medical practitioner and is not competent to offer medical opinions. Grottveit v. Brown, 5 Vet. App. 91 (1993); Espiritu v. Derwinski, 2 Vet. App. 492 (1992). Further, although the Board finds the Veteran credible in reporting his symptoms, such are consistent with the current 50 percent rating. Accordingly, the Board finds that the medical findings on clinical evaluation are of greater probative value than the Veteran's statements regarding the severity of his PTSD. Therefore, based on the medical evidence of record, the Board concludes that for the period from June 30, 2005, the Veteran's overall disability picture more nearly approximates the criteria for the currently assigned 50 percent evaluation. As a result, the Board finds that the preponderance of the evidence is against an evaluation in excess of 50 percent for the Veteran's PTSD for the period from June 30, 2005 and the claim must be denied. Extraschedular Consideration The Board is required to address the issue of entitlement to an extraschedular rating under 38 C.F.R.",
"§ 3.321 only in cases where the issue is expressly raised by the claimant or the record before the Board contains evidence of \"exceptional or unusual\" circumstances indicating that the rating schedule may be inadequate to compensate for the average impairment of earning capacity due to the disability. See VA O.G.C. Prec. Op. 6-96 (August 16, 1996). In this case, consideration of an extraschedular rating has not been expressly raised. Further, the record before the Board does not contain evidence of \"exceptional or unusual\" circumstances that would preclude the use of the regular rating schedule. 38 C.F.R. § 3.321 (2009). ORDER Entitlement to an initial evaluation of 50 percent, but no higher, for PTSD, for the period from December 13, 2005 through June 29, 2009, is granted, subject to the applicable law governing the award of monetary benefits.",
"Entitlement to an initial evaluation in excess of 50 percent for PTSD, for the period from June 30, 2009, is denied. REMAND The Board finds that statements contained in the record, including in the December 2009 VA examination report, can be construed as raising the issue of entitlement to TDIU. See Roberson v. Principi, 251 F.3d 1378, 1384 (Fed. Cir.",
"2001) (once a veteran submits evidence of medical disability and additionally submits evidence of unemployability, VA must consider total rating for compensation based upon individual unemployability). The U.S. Court of Appeals for Veterans Claims recently held that a request for TDIU is not a separate claim for benefits, but rather involves an attempt to obtain an appropriate rating for a disability or disabilities, either as part of the initial adjudication of a claim or, if a disability upon which entitlement to TDIU is based has already been found to be service connected, as part of a claim for increased compensation.",
"Rice v. Shinseki, 22 Vet. App. 447, 453 (2009). If the claimant or the record reasonably raises the question of whether the Veteran is unemployable due to the disability for which an increased rating is sought, then part and parcel to that claim for an increased rating is whether a total rating based on individual unemployability as a result of that disability is warranted. Id at 455. As the RO has not yet considered whether the Veteran is entitled to TDIU, the issue must be remanded to the RO for consideration. Accordingly, the case is remanded for the following action: 1. The RO must provide the Veteran with a letter satisfying VA's duties to notify and assist, pursuant to VCAA, with respect to his claim of entitlement to TDIU. The Veteran should be requested to complete a provided VA Form, 21-8940, Veteran's Application for Increased Compensation Based on Unemployability. 2. The Veteran should be afforded a VA examination to determine the effect of the Veteran's service-connected disabilities, in combination, on his ability to work. The examiner should describe what types of employment activities are limited because of the Veteran's service-connected disabilities, and what type of employment, if any, is feasible given his functional impairment. Finally, the examiner should provide an opinion as to whether the Veteran's service-connected disabilities, in combination, render him unable to obtain or maintain substantially gainful employment.",
"The claims folder, including a copy of this Remand, should be reviewed in conjunction with such examination and the examination reports should indicate that such a review was performed. All opinions expressed should be accompanied by complete rationales. 3. The RO must then adjudicate the issue of entitlement to a TDIU. If the claim remains denied, the Veteran and his attorney must be provided a Statement of the Case. Only if the Veteran submits a timely substantive appeal as to the issue, should it be returned to the Board for appellate review.",
"The appellant has the right to submit additional evidence and argument on the matter the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999). ______________________________________________ U. R. POWELL Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs"
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
EXHIBIT 23.12 CONSENT OF EXPERT Reference is made to Snowden Mining Industry Consultants’ resource estimate for the Maverick Springs Project dated April 13, 2004 (the “Report”), in Silver Standard Resources Inc.’s Form 20-F for the fiscal year ended December 31, 2011. In connection with the Registration Statement on Form S-8 of Silver Standard Resources Inc. dated December 14, 2012 and any amendments thereto, including any post-effective amendments (collectively, the “Registration Statement”), Snowden Mining Industry Consultants consents to the use of its name and references to the Report, or portions thereof, in the Registration Statement and to the inclusion or incorporation by reference of information derived from the Report in the Registration Statement. I have read the Registration Statement and have no reason to believe that there are any misrepresentations in the information contained therein that are derived from the Report or that are within our knowledge as a result of the preparation of the Report. Yours truly, Snowden Mining Industry Consultants Per: /s/ Robert McCarthy, P.Eng. Name: Robert McCarthy, P.Eng. Title: General Manager Americas | [
"EXHIBIT 23.12 CONSENT OF EXPERT Reference is made to Snowden Mining Industry Consultants’ resource estimate for the Maverick Springs Project dated April 13, 2004 (the “Report”), in Silver Standard Resources Inc.’s Form 20-F for the fiscal year ended December 31, 2011. In connection with the Registration Statement on Form S-8 of Silver Standard Resources Inc. dated December 14, 2012 and any amendments thereto, including any post-effective amendments (collectively, the “Registration Statement”), Snowden Mining Industry Consultants consents to the use of its name and references to the Report, or portions thereof, in the Registration Statement and to the inclusion or incorporation by reference of information derived from the Report in the Registration Statement. I have read the Registration Statement and have no reason to believe that there are any misrepresentations in the information contained therein that are derived from the Report or that are within our knowledge as a result of the preparation of the Report. Yours truly, Snowden Mining Industry Consultants Per: /s/ Robert McCarthy, P.Eng.",
"Name: Robert McCarthy, P.Eng. Title: General Manager Americas"
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
|
Citation Nr: 0639019
Decision Date: 12/14/06 Archive Date: 01/04/07
DOCKET NO. 02-10 691 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office
in Albuquerque, New Mexico
THE ISSUES
1. Entitlement to an initial rating higher than 10 percent
for patellofemoral pain syndrome, right.
2. Entitlement to an initial compensable rating for
residuals of ruptured ligament, right fifth finger.
REPRESENTATION
Veteran represented by: Disabled American Veterans
WITNESS AT HEARING ON APPEAL
Veteran
ATTORNEY FOR THE BOARD
S. Yim, Associate Counsel
INTRODUCTION
The veteran served on active duty from February 1998 to July
2001. This matter is before the Board of Veterans' Appeals
(Board) on appeal of a January 2002 rating decision of the
Department of Veterans Affairs (VA) Regional Office (RO) in
Phoenix, Arizona, and was remanded in November 2004 and in
February 2006.
In July 2005, the veteran wrote that an employee of the
Phoenix, Arizona, RO, would represent her at the August 2005
Board hearing, and the veteran was so represented at that
hearing. The Board construes that statement to mean that
such representation was limited to representation at the
Board hearing.
FINDINGS OF FACT
1. Patellofemoral pain syndrome, right, is manifested by
symptoms and manifestations no more significant than moderate
impairment of the knee, to include recurrent subluxation or
lateral instability.
2. Residuals of ruptured ligament, right fifth finger, are
not manifested by ankylosis; nor is the disability equivalent
to an amputated digit.
3. Current examination of the right hand does not reflect
functional impairment of the right fifth finger based on
objective evidence of weakness, fatigability, incoordination,
swelling, or tenderness; capillary circulation was normal;
other than reported "tingly" sensation at the tip of the
finger, sensory examination was normal. MCP joint extension
lacked 10 degrees in motion (active), but otherwise, normal
motion of the right fifth finger is documented.
CONCLUSIONS OF LAW
1. The criteria for a 20 percent rating, but no higher, are
met for patellofemoral pain syndrome, right. 38 U.S.C.A.
§§ 1155, 5107(b) (West 2002); 38 C.F.R. §§ 4.3, 4.40, 4.45,
4.59, 4.71a, Diagnostic Code 5257 (2006).
2. The criteria for a compensable rating for residuals of
ruptured ligament, right fifth finger, are not met.
38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. §§ 4.40, 4.45,
4.59, 4.71a, Diagnostic Codes 5299-5227 (2001, 2006).
REASONS AND BASES FOR FINDINGS AND CONCLUSIONS
I. Increased Evaluations
This appeal arises from a January 2002 rating decision,
which, among other things, granted service connection for
right patellofemoral pain syndrome and ruptured ligament,
right fifth finger. The veteran seeks higher (or
compensable, as to the latter) initial evaluations for those
disabilities. Thus, this appeal is akin to that in Fenderson
v. West, 12 Vet. App. 119, 126 (1999), and the Board
considers "staged" ratings for various periods of time
since the filing of the original (July 2001) service
connection claim, forward, as the evidence warrants. The
effective date of the presently assigned ratings is July 11,
2001, the day after the veteran's discharge from service,
based on her filing of an original claim within a year after
discharge. 38 U.S.C.A. § 5110(b)(1) (West 2002). As no
rating can precede July 11, 2001, the focus of the Board's
discussion below is on evidence from that date, forward.
The veteran's right patellofemoral pain syndrome is evaluated
as 10 percent disabling under 38 C.F.R. § 4.71a, Diagnostic
Code 5257 (2006). The next higher rating of 20 percent is
assigned with evidence of moderate impairment of the knee,
characterized by recurrent subluxation or lateral
instability. The veteran has complained of right knee pain,
"catching," and instability. While some clinical findings
do not favor a higher rating (see, e.g., September 2001 VA
compensation and pension (C&P) examination report, which
indicates there is no instability of the knee joint), other
evidence tends to support a higher rating of 20 percent for
moderate disability, but not higher (i.e., the maximum 30
percent rating for severe disability manifested by recurrent
subluxation or lateral instability). Specifically, in July
2002, a VA C&P examiner noted that the patella "subluxes
laterally slightly" and is "a bit lax," and that there is
lateral instability, as "manifested by giving way." The
examiner characterized the extent of such disability as
"moderate" when pain symptomatology is taken into account.
Also, even the C&P examiner who said that there is no
instability did acknowledge that the "patella does seem to
be slightly hypermobile," and also said: "There is a
question of a current minimal effusion." Based on such
evidence, the Board resolves any reasonable doubt regarding a
higher rating in the veteran's favor (38 C.F.R. § 4.3) and
finds that a 20 percent rating is warranted under Diagnostic
Code 5257.
The Board has reviewed VA clinical records and various C&P
examination findings, in particular those dated more
recently, and it does not find clinical evidence that would
support a rating higher than 20 percent (i.e., the highest
rating of 30 percent for severe recurrent subluxation or
lateral instability). First, even the July 2002 C&P
examination, which, among the various C&P examinations
performed since discharge, yielded findings most favorable to
the veteran in terms of evaluation under Diagnostic Code
5257, did not result in a clinical determination of
"severe" recurrent subluxation or lateral instability. The
examiner characterized the disability, with consideration of
instability and slight subluxation, as "moderate."
Also, because terms like "slight," "moderate," and
"severe" are not precise as to what specific objective
findings are ascribed to each, the Board has considered other
criteria, particularly those on motion and functional
limitations, including limitation due to factors like pain,
pain on use, fatigability, incoordination, and weakness, to
determine whether a more favorable rating is in order. See
38 C.F.R. § 4.71a, Diagnostic Codes 5260 (flexion) and 5261
(extension); 38 C.F.R. §§ 4.40, 4.45, 4.59 (2006); DeLuca v.
Brown, 8 Vet. App. 202 (1995).
As of the September 2001 C&P examination, right knee range of
motion was from zero to 110 degrees actively, with another 5-
10 degrees of movement passively, when pain sets in. Flexion
was to 140 degrees as of July 2002. As of January 2005,
extension was to zero degrees; flexion was to 90 degrees
(active) and 120 degrees (passive), with complaint of pain on
flexion. As of April 2006, extension was to zero degrees;
flexion was to 70 degrees (active) and 115 degrees (passive),
with pain on flexion. Normal extension/flexion ranges from
zero to 140 degrees. See Plate II illustration, 38 C.F.R.
§ 4.71. A 20 percent rating under Diagnostic Code 5260 would
require evidence of flexion limited to 30 degrees; a 20
percent rating under Diagnostic Code 5261 would require
evidence of extension limited to 15 degrees. The various
range-of-motion findings would not, themselves, support even
the next higher rating of 20 percent, as motion is possible
well beyond the limitations required for such rating,
notwithstanding the C&P examiner's statement in April 2006
that the range-of-motion results indicate "moderately
severe" functional impairment.
Also, the 20 percent rating that the Board is granting herein
under Diagnostic Code 5257 does take into account functional
impairment due to instability and subluxation. In addition,
recent C&P examination findings are negative as to other
factors that could indicate additional functional impairment
commensurate to a higher rating. In January 2005, the C&P
examiner noted that the knee ligaments are stable; that gait
is normal; that there is no effusion, crepitation, and no
fatigability. In April 2006, a C&P examiner noted similar
findings. These considerations and those discussed in the
preceding paragraph, when viewed in the context of the whole
record, indicate that, with employment of the benefit-of-
reasonable doubt rule, a 20 percent rating, but not higher,
closely approximates the disability picture as to the right
knee.
In addition, the Board is aware of VAOPGCPREC 23-97 and
VAOPGCPREC 9-98 (When a claimant has a disability rating
under Diagnostic Code 5257 and there is X-ray evidence of
arthritis, but a compensable rating for limitation of motion
is not assigned under either Diagnostic Code 5260 or 5261, a
separate rating under 38 C.F.R. § 4.71a, Diagnostic Codes
5003 or 5010 could be assigned.). However, in this case, a
more favorable rating cannot be based on either because
service connection is not in effect for arthritis of the
right knee, and the clinical records do not document
diagnosis of arthritic right knee specifically.
The Board has considered other knee disability rating
criteria, but finds that Diagnostic Codes 5256, 5258, 5259,
5262, and 5263 cannot be the basis for a more favorable
evaluation without clinical evidence specifically concerning
ankylosed knee, dislocated semilunar cartilage, removal of
semilunar cartilage, impairment of the tibia or fibula, or
genu recurvatum.
With respect to the right fifth finger ruptured ligament,
that disability is evaluated under 38 C.F.R. § 4.71a,
Diagnostic Codes "5299-5227." This hyphenated, "built up"
Code using 5299 signifies the RO's application of a closely
analogous Code due to the lack of a Code specific to the
diagnosis at issue in the VA rating criteria. See 38 C.F.R.
§ 4.27. The application of Diagnostic Code 5227 is based on
the RO's determination that it is closely analogous to the
veteran's disability. VA is permitted to rate by analogy
under such circumstances. 38 C.F.R. § 4.20. The Board has
considered the various Codes evaluating digits of the hand,
and, it, too, finds that Diagnostic Code 5227 is most closely
analogous to the disability at issue.
The criteria for evaluating ankylosis or limitation of motion
of single or multiple digit(s) of the hand were amended,
effective August 26, 2002. See 67 Fed. Reg. 48,784 (July 26,
2002). The Board has considered old and new criteria, as the
criteria were amended during the time period pertinent to
this case.
Of the old criteria, the sole Code applicable to the instant
case is Diagnostic Code 5227, which provided for only a
noncompensable rating for ankylosis of any finger other than
the thumb, index, or middle fingers, whether on the major or
minor hand. The Note to the Code provides that "extremely
unfavorable" ankylosis will be rated as amputation under
Diagnostic Codes 5152 through 5156.
Current Diagnostic Code 5227 also does not permit a
compensable rating; the only rating available is zero
percent, for ankylosis of the ring or little finger, and
whether ankylosis is favorable or unfavorable. A Note to the
Code provides that consideration of criteria governing
amputation may be warranted, and as well, whether additional
rating is warranted for resulting limitation of motion of
other digits or interference with overall function of the
hand. Current Diagnostic Code 5230, which also evaluates
ring or little finger disability, but based on limited
motion, permits only a noncompensable rating even for "any"
limitation of motion.
Therefore, while neither the old or current criteria permit a
compensable rating for ankylosis of the little finger itself,
both are consistent to the extent that they consider
functional limitation caused by the disability of the little
finger in the sense that the disability might be equivalent
to amputation of the digit. And, current criteria explicitly
provide that functional limitation in terms of whether, and
to what extent, the use of the hand overall is affected, is
to be considered. See also 38 C.F.R. §§ 4.40, 4.45, 4.59
(2006); DeLuca v. Brown, 8 Vet. App. 202 (1995).
The veteran's right fifth finger is not ankylosed. Nor has
she had the right fifth finger amputated, all or part. Thus,
the various criteria concerning amputated digits, strictly
speaking, are not applicable. Also, the old criteria provide
that amputation criteria are to be considered where ankylosis
is "extremely unfavorable," and that is not shown here.
Nor has a clinician opined that the right fifth finger
disability is to such an extent that it is equivalent to an
amputated digit. The veteran's complaints are of pain and
intermittent swelling upon use, like typing for prolonged
periods of time (the veteran is a receptionist). She
reportedly takes breaks from typing before resuming. She has
difficulty gripping, for example, pots when cooking.
However, as of the April 2006 VA examination, she herself
said that the finger disability does not restrict functioning
at her job.
Clinical, objective evidence does not indicate that the
veteran's right fifth finger disability affects the use of
that hand overall. X-rays of the right fifth finger are
reportedly normal as of the most recent VA examination. The
veteran has reported symptoms that are exacerbated on use,
and the examiner said that "functional impairment is
moderate," apparently based on such reports. However, the
examiner also explicitly said that there is no weakness,
fatigability, or incoordination, and such evidence tends not
to support a conclusion that overall function of the hand is
affected. Also, as of the most recent examination, clinical
findings were negative as to swelling or tenderness.
Capillary circulation also was normal. Other than reported
"tingly" sensation at the tip of the finger, sensory
examination, too, was normal. MCP joint extension lacked 10
degrees in motion (active), but otherwise, the examiner
appears to have concluded normal motion of the right fifth
finger.
Based on the foregoing, the Board concludes that the
preponderance of the evidence is against compensable
evaluation for the right fifth finger disability. Therefore,
it does not employ the benefit-of reasonable doubt rule.
38 C.F.R. § 4.3 (2006).
Finally, the evidence as a whole does not suggest that this
case presents so exceptional or unusual a disability picture
such that the veteran is unable to secure and follow
substantially gainful employment, or otherwise render a
schedular rating impractical. As noted in the April 2006 C&P
examination, there is "no definite occupational impairment
in her current occupation" due to the knee disability. The
examiner also said that the knee disability causes a "mild
plus" interference with her employment. As for the right
finger disability, the examiner said: "I am not aware that
there would [be] any influence on her earning capacity with
respect to the finger." The examiner also opined that the
finger disability causes "mild" or "minimal" interference
with employment. These opinions do not support a conclusion
that the case presents an exceptional or unusual disability
picture such that extraschedular evaluation is warranted.
II. Duties to Notify and Assist
VA's duties to notify and assist claimants in substantiating
a claim for VA benefits are found at 38 U.S.C.A. §§ 5100,
5102, 5103, 5103A, 5107, 5126 (West 2002 & Supp. 2005);
38 C.F.R. §§ 3.102, 3.156(a), 3.159 and 3.326(a) (2006).
Upon receipt of a complete or substantially complete benefits
application, VA must notify the claimant and any
representative of any information, and medical or lay
evidence, needed to substantiate the claim. 38 U.S.C.A. §
5103(a); 38 C.F.R. § 3.159(b); Quartuccio v. Principi, 16
Vet. App. 183 (2002). VA must inform the claimant of any
information and evidence not of record needed to substantiate
the claim, that VA will seek to provide, and that he should
provide. It must ask him to provide any pertinent evidence
he has ("fourth element"). 38 C.F.R. § 3.159(b)(1).
Notice should be provided before the initial unfavorable
agency of original jurisdiction (AOJ) decision. Pelegrini v.
Principi, 18 Vet. App. 112 (2004).
During the appeal, VA sent the veteran notices (in September
2003, January 2005, and March 2006) advising her that
compensation based on a higher rating requires evidence of
worsened disability, and that, if she identifies the sources
of pertinent evidence, then VA would assist her in obtaining
the records therefrom. She was told about what types of
evidence could be pertinent, e.g., lay statements; insurance
and employment examination records, and in particular,
current clinical evidence concerning her knee or finger. She
was told that, notwithstanding VA's duty to assist, she
ultimately is responsible for substantiation of her claim
with evidence not in federal custody. The January 2005 and
March 2006 letters informed her that she may submit any
pertinent evidence in her possession (fourth element notice).
Such notice was reinforced with citation of 38 C.F.R.
§ 3.159, from which the element is derived, in recent
Supplemental Statements of the Case (SSOCs).
While VA did not comply with notice requirements before
issuing the rating decision from which the appeal arises, the
Board does not find prejudice occurred due to a timing
defect. See Bernard v. Brown, 4 Vet. App. 384, 394 (1993)
(where the Board addresses a question not addressed by the
AOJ, the Board must consider whether prejudice occurred);
38 C.F.R. § 20.1102 (2006) (harmless error). The veteran was
provided multiple notices during appeal, and had ample
opportunity to identify sources of missing, pertinent
evidence if she desired VA development assistance, or to
supply any missing evidence herself. The appeal was remanded
to afford her a hearing opportunity, and her testimony was
considered, along with other evidence of record. The Board
ordered a C&P examination, which was conducted. As recently
as in October 2006, after the last SSOC was issued, the
veteran's representative submitted additional argument, but
did not identify any sources of missing evidence, or
specifically argue a notice defect. Nor did the veteran or
her representative report that additional time was needed to
supply missing evidence. Also, while VA did not provide
notice consistent with Dingess v. Nicholson, 19 Vet. App. 473
(2006) (what considerations govern VA determination of
disability ratings and effective dates for service connection
and disability evaluation), there is no prejudice due to such
failure. The veteran was notified of specific rating
criteria applicable to the instant claim, and, because even
higher (knee) and compensable (finger) ratings are denied,
there can be no prejudice based on lack of notice of
effective date criteria.
VA's duty to assist a claimant in substantiating the claim
(see 38 U.S.C.A. § 5103A; 38 C.F.R. § 3.159(c), (d)) also was
satisfied. This duty contemplates that VA will help a
claimant obtain relevant records, whether or not they are in
federal custody, and that VA will provide a medical
examination and/or opinion if needed to decide the claim.
The claims file includes VA medical records, including VA
examination results and hearing testimony. The veteran has
not identified sources of pertinent, existing evidence that
is missing from the record and which he desires VA to review
before adjudication. Based on all of the foregoing, the
Board concludes that VA's duty to assist was met, and it is
not precluded from adjudicating this decision based on the
record.
ORDER
An initial rating of 20 percent, but no higher, for
patellofemoral pain syndrome, right knee, is granted.
An initial compensable rating for residuals of ruptured
ligament, right fifth finger, is denied.
____________________________________________
RONALD W. SCHOLZ
Acting Veterans Law Judge, Board of Veterans' Appeals
Department of Veterans Affairs | 12-14-2006 | [
"Citation Nr: 0639019 Decision Date: 12/14/06 Archive Date: 01/04/07 DOCKET NO. 02-10 691 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Albuquerque, New Mexico THE ISSUES 1. Entitlement to an initial rating higher than 10 percent for patellofemoral pain syndrome, right. 2. Entitlement to an initial compensable rating for residuals of ruptured ligament, right fifth finger. REPRESENTATION Veteran represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL Veteran ATTORNEY FOR THE BOARD S. Yim, Associate Counsel INTRODUCTION The veteran served on active duty from February 1998 to July 2001. This matter is before the Board of Veterans' Appeals (Board) on appeal of a January 2002 rating decision of the Department of Veterans Affairs (VA) Regional Office (RO) in Phoenix, Arizona, and was remanded in November 2004 and in February 2006. In July 2005, the veteran wrote that an employee of the Phoenix, Arizona, RO, would represent her at the August 2005 Board hearing, and the veteran was so represented at that hearing. The Board construes that statement to mean that such representation was limited to representation at the Board hearing.",
"FINDINGS OF FACT 1. Patellofemoral pain syndrome, right, is manifested by symptoms and manifestations no more significant than moderate impairment of the knee, to include recurrent subluxation or lateral instability. 2. Residuals of ruptured ligament, right fifth finger, are not manifested by ankylosis; nor is the disability equivalent to an amputated digit. 3. Current examination of the right hand does not reflect functional impairment of the right fifth finger based on objective evidence of weakness, fatigability, incoordination, swelling, or tenderness; capillary circulation was normal; other than reported \"tingly\" sensation at the tip of the finger, sensory examination was normal. MCP joint extension lacked 10 degrees in motion (active), but otherwise, normal motion of the right fifth finger is documented. CONCLUSIONS OF LAW 1.",
"The criteria for a 20 percent rating, but no higher, are met for patellofemoral pain syndrome, right. 38 U.S.C.A. §§ 1155, 5107(b) (West 2002); 38 C.F.R. §§ 4.3, 4.40, 4.45, 4.59, 4.71a, Diagnostic Code 5257 (2006). 2. The criteria for a compensable rating for residuals of ruptured ligament, right fifth finger, are not met. 38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. §§ 4.40, 4.45, 4.59, 4.71a, Diagnostic Codes 5299-5227 (2001, 2006). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS I. Increased Evaluations This appeal arises from a January 2002 rating decision, which, among other things, granted service connection for right patellofemoral pain syndrome and ruptured ligament, right fifth finger. The veteran seeks higher (or compensable, as to the latter) initial evaluations for those disabilities.",
"Thus, this appeal is akin to that in Fenderson v. West, 12 Vet. App. 119, 126 (1999), and the Board considers \"staged\" ratings for various periods of time since the filing of the original (July 2001) service connection claim, forward, as the evidence warrants. The effective date of the presently assigned ratings is July 11, 2001, the day after the veteran's discharge from service, based on her filing of an original claim within a year after discharge. 38 U.S.C.A. § 5110(b)(1) (West 2002). As no rating can precede July 11, 2001, the focus of the Board's discussion below is on evidence from that date, forward.",
"The veteran's right patellofemoral pain syndrome is evaluated as 10 percent disabling under 38 C.F.R. § 4.71a, Diagnostic Code 5257 (2006). The next higher rating of 20 percent is assigned with evidence of moderate impairment of the knee, characterized by recurrent subluxation or lateral instability. The veteran has complained of right knee pain, \"catching,\" and instability. While some clinical findings do not favor a higher rating (see, e.g., September 2001 VA compensation and pension (C&P) examination report, which indicates there is no instability of the knee joint), other evidence tends to support a higher rating of 20 percent for moderate disability, but not higher (i.e., the maximum 30 percent rating for severe disability manifested by recurrent subluxation or lateral instability). Specifically, in July 2002, a VA C&P examiner noted that the patella \"subluxes laterally slightly\" and is \"a bit lax,\" and that there is lateral instability, as \"manifested by giving way.\"",
"The examiner characterized the extent of such disability as \"moderate\" when pain symptomatology is taken into account. Also, even the C&P examiner who said that there is no instability did acknowledge that the \"patella does seem to be slightly hypermobile,\" and also said: \"There is a question of a current minimal effusion.\" Based on such evidence, the Board resolves any reasonable doubt regarding a higher rating in the veteran's favor (38 C.F.R. § 4.3) and finds that a 20 percent rating is warranted under Diagnostic Code 5257. The Board has reviewed VA clinical records and various C&P examination findings, in particular those dated more recently, and it does not find clinical evidence that would support a rating higher than 20 percent (i.e., the highest rating of 30 percent for severe recurrent subluxation or lateral instability).",
"First, even the July 2002 C&P examination, which, among the various C&P examinations performed since discharge, yielded findings most favorable to the veteran in terms of evaluation under Diagnostic Code 5257, did not result in a clinical determination of \"severe\" recurrent subluxation or lateral instability. The examiner characterized the disability, with consideration of instability and slight subluxation, as \"moderate.\" Also, because terms like \"slight,\" \"moderate,\" and \"severe\" are not precise as to what specific objective findings are ascribed to each, the Board has considered other criteria, particularly those on motion and functional limitations, including limitation due to factors like pain, pain on use, fatigability, incoordination, and weakness, to determine whether a more favorable rating is in order. See 38 C.F.R. § 4.71a, Diagnostic Codes 5260 (flexion) and 5261 (extension); 38 C.F.R. §§ 4.40, 4.45, 4.59 (2006); DeLuca v. Brown, 8 Vet.",
"App. 202 (1995). As of the September 2001 C&P examination, right knee range of motion was from zero to 110 degrees actively, with another 5- 10 degrees of movement passively, when pain sets in. Flexion was to 140 degrees as of July 2002. As of January 2005, extension was to zero degrees; flexion was to 90 degrees (active) and 120 degrees (passive), with complaint of pain on flexion. As of April 2006, extension was to zero degrees; flexion was to 70 degrees (active) and 115 degrees (passive), with pain on flexion. Normal extension/flexion ranges from zero to 140 degrees. See Plate II illustration, 38 C.F.R. § 4.71. A 20 percent rating under Diagnostic Code 5260 would require evidence of flexion limited to 30 degrees; a 20 percent rating under Diagnostic Code 5261 would require evidence of extension limited to 15 degrees.",
"The various range-of-motion findings would not, themselves, support even the next higher rating of 20 percent, as motion is possible well beyond the limitations required for such rating, notwithstanding the C&P examiner's statement in April 2006 that the range-of-motion results indicate \"moderately severe\" functional impairment. Also, the 20 percent rating that the Board is granting herein under Diagnostic Code 5257 does take into account functional impairment due to instability and subluxation. In addition, recent C&P examination findings are negative as to other factors that could indicate additional functional impairment commensurate to a higher rating. In January 2005, the C&P examiner noted that the knee ligaments are stable; that gait is normal; that there is no effusion, crepitation, and no fatigability. In April 2006, a C&P examiner noted similar findings. These considerations and those discussed in the preceding paragraph, when viewed in the context of the whole record, indicate that, with employment of the benefit-of- reasonable doubt rule, a 20 percent rating, but not higher, closely approximates the disability picture as to the right knee. In addition, the Board is aware of VAOPGCPREC 23-97 and VAOPGCPREC 9-98 (When a claimant has a disability rating under Diagnostic Code 5257 and there is X-ray evidence of arthritis, but a compensable rating for limitation of motion is not assigned under either Diagnostic Code 5260 or 5261, a separate rating under 38 C.F.R.",
"§ 4.71a, Diagnostic Codes 5003 or 5010 could be assigned.). However, in this case, a more favorable rating cannot be based on either because service connection is not in effect for arthritis of the right knee, and the clinical records do not document diagnosis of arthritic right knee specifically. The Board has considered other knee disability rating criteria, but finds that Diagnostic Codes 5256, 5258, 5259, 5262, and 5263 cannot be the basis for a more favorable evaluation without clinical evidence specifically concerning ankylosed knee, dislocated semilunar cartilage, removal of semilunar cartilage, impairment of the tibia or fibula, or genu recurvatum. With respect to the right fifth finger ruptured ligament, that disability is evaluated under 38 C.F.R. § 4.71a, Diagnostic Codes \"5299-5227.\" This hyphenated, \"built up\" Code using 5299 signifies the RO's application of a closely analogous Code due to the lack of a Code specific to the diagnosis at issue in the VA rating criteria.",
"See 38 C.F.R. § 4.27. The application of Diagnostic Code 5227 is based on the RO's determination that it is closely analogous to the veteran's disability. VA is permitted to rate by analogy under such circumstances. 38 C.F.R. § 4.20. The Board has considered the various Codes evaluating digits of the hand, and, it, too, finds that Diagnostic Code 5227 is most closely analogous to the disability at issue. The criteria for evaluating ankylosis or limitation of motion of single or multiple digit(s) of the hand were amended, effective August 26, 2002. See 67 Fed. Reg. 48,784 (July 26, 2002). The Board has considered old and new criteria, as the criteria were amended during the time period pertinent to this case. Of the old criteria, the sole Code applicable to the instant case is Diagnostic Code 5227, which provided for only a noncompensable rating for ankylosis of any finger other than the thumb, index, or middle fingers, whether on the major or minor hand. The Note to the Code provides that \"extremely unfavorable\" ankylosis will be rated as amputation under Diagnostic Codes 5152 through 5156. Current Diagnostic Code 5227 also does not permit a compensable rating; the only rating available is zero percent, for ankylosis of the ring or little finger, and whether ankylosis is favorable or unfavorable.",
"A Note to the Code provides that consideration of criteria governing amputation may be warranted, and as well, whether additional rating is warranted for resulting limitation of motion of other digits or interference with overall function of the hand. Current Diagnostic Code 5230, which also evaluates ring or little finger disability, but based on limited motion, permits only a noncompensable rating even for \"any\" limitation of motion. Therefore, while neither the old or current criteria permit a compensable rating for ankylosis of the little finger itself, both are consistent to the extent that they consider functional limitation caused by the disability of the little finger in the sense that the disability might be equivalent to amputation of the digit. And, current criteria explicitly provide that functional limitation in terms of whether, and to what extent, the use of the hand overall is affected, is to be considered.",
"See also 38 C.F.R. §§ 4.40, 4.45, 4.59 (2006); DeLuca v. Brown, 8 Vet. App. 202 (1995). The veteran's right fifth finger is not ankylosed. Nor has she had the right fifth finger amputated, all or part. Thus, the various criteria concerning amputated digits, strictly speaking, are not applicable. Also, the old criteria provide that amputation criteria are to be considered where ankylosis is \"extremely unfavorable,\" and that is not shown here. Nor has a clinician opined that the right fifth finger disability is to such an extent that it is equivalent to an amputated digit. The veteran's complaints are of pain and intermittent swelling upon use, like typing for prolonged periods of time (the veteran is a receptionist). She reportedly takes breaks from typing before resuming. She has difficulty gripping, for example, pots when cooking. However, as of the April 2006 VA examination, she herself said that the finger disability does not restrict functioning at her job. Clinical, objective evidence does not indicate that the veteran's right fifth finger disability affects the use of that hand overall. X-rays of the right fifth finger are reportedly normal as of the most recent VA examination. The veteran has reported symptoms that are exacerbated on use, and the examiner said that \"functional impairment is moderate,\" apparently based on such reports.",
"However, the examiner also explicitly said that there is no weakness, fatigability, or incoordination, and such evidence tends not to support a conclusion that overall function of the hand is affected. Also, as of the most recent examination, clinical findings were negative as to swelling or tenderness. Capillary circulation also was normal. Other than reported \"tingly\" sensation at the tip of the finger, sensory examination, too, was normal. MCP joint extension lacked 10 degrees in motion (active), but otherwise, the examiner appears to have concluded normal motion of the right fifth finger. Based on the foregoing, the Board concludes that the preponderance of the evidence is against compensable evaluation for the right fifth finger disability. Therefore, it does not employ the benefit-of reasonable doubt rule. 38 C.F.R. § 4.3 (2006).",
"Finally, the evidence as a whole does not suggest that this case presents so exceptional or unusual a disability picture such that the veteran is unable to secure and follow substantially gainful employment, or otherwise render a schedular rating impractical. As noted in the April 2006 C&P examination, there is \"no definite occupational impairment in her current occupation\" due to the knee disability. The examiner also said that the knee disability causes a \"mild plus\" interference with her employment.",
"As for the right finger disability, the examiner said: \"I am not aware that there would [be] any influence on her earning capacity with respect to the finger.\" The examiner also opined that the finger disability causes \"mild\" or \"minimal\" interference with employment. These opinions do not support a conclusion that the case presents an exceptional or unusual disability picture such that extraschedular evaluation is warranted. II. Duties to Notify and Assist VA's duties to notify and assist claimants in substantiating a claim for VA benefits are found at 38 U.S.C.A.",
"§§ 5100, 5102, 5103, 5103A, 5107, 5126 (West 2002 & Supp. 2005); 38 C.F.R. §§ 3.102, 3.156(a), 3.159 and 3.326(a) (2006). Upon receipt of a complete or substantially complete benefits application, VA must notify the claimant and any representative of any information, and medical or lay evidence, needed to substantiate the claim. 38 U.S.C.A. § 5103(a); 38 C.F.R. § 3.159(b); Quartuccio v. Principi, 16 Vet. App. 183 (2002). VA must inform the claimant of any information and evidence not of record needed to substantiate the claim, that VA will seek to provide, and that he should provide. It must ask him to provide any pertinent evidence he has (\"fourth element\"). 38 C.F.R.",
"§ 3.159(b)(1). Notice should be provided before the initial unfavorable agency of original jurisdiction (AOJ) decision. Pelegrini v. Principi, 18 Vet. App. 112 (2004). During the appeal, VA sent the veteran notices (in September 2003, January 2005, and March 2006) advising her that compensation based on a higher rating requires evidence of worsened disability, and that, if she identifies the sources of pertinent evidence, then VA would assist her in obtaining the records therefrom.",
"She was told about what types of evidence could be pertinent, e.g., lay statements; insurance and employment examination records, and in particular, current clinical evidence concerning her knee or finger. She was told that, notwithstanding VA's duty to assist, she ultimately is responsible for substantiation of her claim with evidence not in federal custody. The January 2005 and March 2006 letters informed her that she may submit any pertinent evidence in her possession (fourth element notice). Such notice was reinforced with citation of 38 C.F.R. § 3.159, from which the element is derived, in recent Supplemental Statements of the Case (SSOCs). While VA did not comply with notice requirements before issuing the rating decision from which the appeal arises, the Board does not find prejudice occurred due to a timing defect. See Bernard v. Brown, 4 Vet. App. 384, 394 (1993) (where the Board addresses a question not addressed by the AOJ, the Board must consider whether prejudice occurred); 38 C.F.R. § 20.1102 (2006) (harmless error).",
"The veteran was provided multiple notices during appeal, and had ample opportunity to identify sources of missing, pertinent evidence if she desired VA development assistance, or to supply any missing evidence herself. The appeal was remanded to afford her a hearing opportunity, and her testimony was considered, along with other evidence of record. The Board ordered a C&P examination, which was conducted. As recently as in October 2006, after the last SSOC was issued, the veteran's representative submitted additional argument, but did not identify any sources of missing evidence, or specifically argue a notice defect. Nor did the veteran or her representative report that additional time was needed to supply missing evidence. Also, while VA did not provide notice consistent with Dingess v. Nicholson, 19 Vet. App. 473 (2006) (what considerations govern VA determination of disability ratings and effective dates for service connection and disability evaluation), there is no prejudice due to such failure. The veteran was notified of specific rating criteria applicable to the instant claim, and, because even higher (knee) and compensable (finger) ratings are denied, there can be no prejudice based on lack of notice of effective date criteria.",
"VA's duty to assist a claimant in substantiating the claim (see 38 U.S.C.A. § 5103A; 38 C.F.R. § 3.159(c), (d)) also was satisfied. This duty contemplates that VA will help a claimant obtain relevant records, whether or not they are in federal custody, and that VA will provide a medical examination and/or opinion if needed to decide the claim. The claims file includes VA medical records, including VA examination results and hearing testimony. The veteran has not identified sources of pertinent, existing evidence that is missing from the record and which he desires VA to review before adjudication.",
"Based on all of the foregoing, the Board concludes that VA's duty to assist was met, and it is not precluded from adjudicating this decision based on the record. ORDER An initial rating of 20 percent, but no higher, for patellofemoral pain syndrome, right knee, is granted. An initial compensable rating for residuals of ruptured ligament, right fifth finger, is denied. ____________________________________________ RONALD W. SCHOLZ Acting Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs"
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Title: To Alexander Hamilton from Lieutenant Colonel Richard Varick, [22 October 1780] From: Varick, Richard To: Hamilton, Alexander
[Robinson’s House, Highlands, New York, October 22, 1780. On October 24, 1780, Varick wrote to Hamilton: “I wrote You on the 22nd.” Letter not found.] | 10-22-1780 | [
"Title: To Alexander Hamilton from Lieutenant Colonel Richard Varick, [22 October 1780] From: Varick, Richard To: Hamilton, Alexander [Robinson’s House, Highlands, New York, October 22, 1780. On October 24, 1780, Varick wrote to Hamilton: “I wrote You on the 22nd.” Letter not found.]"
] | https://founders.archives.gov/API/docdata/Hamilton/01-26-02-0002-0044 | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 1 of 17
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
MICHAEL J. BYNUM and § CANADA HOCKEY LLC § d/b/a EPIC SPORTS, § Civil Action No. 4:17-cv-00181 § Plaintiffs, § OMAN Amicus Brief § vs. § § TEXAS A&M UNIVERSITY § ATHLETIC § DEPARTMENT; TEXAS A&M § UNIVERSITY 12TH MAN § FOUNDATION; BRAD § MARQUARDT, in his individual § capacity; ALAN CANNON, in his § individual capacity; and LANE § STEPHENSON, in his individual § capacity, § § Defendants. §
AMICUS CURIAE RALPH OMAN’S BRIEF IN SUPPORT OF PLAINTIFFS’ PENDING MOTION FOR RECONSIDERATION Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 2 of 17
TABLE OF CONTENTS
TABLE OF AUTHORITIES ……………………………………………………….3
STATEMENT OF INTEREST OF AMICUS CURIAE …………………………...4
QUALIFICATIONS ………………………………………………………………..6
ARGUMENT……………………………………………………………………….9
CONCLUSION……………………………………………………………………16
2 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 3 of 17
TABLE OF AUTHORITIES
Cases
Allen v. Cooper 517 U.S. 44 (2020)
Atascadero State Hospital v. Scanlon, 473 U.S. 234 (1985)
Chavez v. Arte Publico Press, 204 F3d 601 (5th Cir. 2000)
United States v. Georgia, 546 U.S. 151 (2006)
Constitutional, Statutory, and Regulatory Provisions
U.S. Const. art. I, § 8, cl. 8
Pub. L. No. 101`-553, 104 Stat. 2749
52 Fed. Reg. 42,045 (Nov. 2, 1987)
Other Authorities
Copyright Remedy Clarification Act and Copyright Office Report on Copyright Liability of States: Hearing on H.R. 1131 Before the Subcomn. on Courts, Intellectual Property, and the Administration of Justice of the H. Comm. On the Judiciary, 101st Cong. (1989)
Letter from Reps. Robert W. Kastenmeier & Carlos Moorhead, H. Subcomm. On Courts, Civil Liberties, and the Administration of Justice, to Ralph Oman, Register of Copyrights (Aug. 3 1987)
Letter from Ralph Oman, Register of Copyrights, to Reps. Robert W. Kastenmeier & Carlos Moorhead, H. Subcomm. On Courts, Civil Liberties, and the Administration of Justice (June 27, 1988)
U.S. Copyright Office, Copyright Liability of States and the Eleventh Amendment: A Report of Register of Copyrights (June 1988)
3 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 4 of 17
STATEMENT OF INTEREST OF AMICUS CURIAE1
I, Ralph Oman, submit this brief as amicus curiae in support of plaintiff’s
Motion for Reconsideration. I submitted an amicus brief in Allen v. Cooper, 517
U.S. 44 (2020) and my name was mentioned expressly on several occasions during
oral argument and in Justice Kagan’s written opinion. See, generally my amicus
brief attached as Appendix F. I served as the Register of Copyrights of the United
States from 1985 to 1994, and I am currently the Pravel, Hewitt, Kimball, and
Kreiger Professorial Lecturer in Intellectual Property and Patent Law at the George
Washington University Law School. Before Congress passed the Copyright
Remedy Clarification Act (“CRCA”) Pub. L. No. 101-553, 104 Stat. 2749 (1990),
the U.S. House of Representatives asked me for “assistance with respect to the
interplay between copyright infringement and the Eleventh Amendment,” and to
investigate the “practical problems relative to the enforcement of copyright against
state governments.” Letter from Reps. Robert W. Kastenmeier & Carlos
Moorhead, H. Subcomm. on Courts, Civil Liberties & the Admin. of Justice, to
Ralph Oman, Register of Copyrights, at 1 (Aug. 3, 1987) (“1987 Letter to Oman”),
in U.S. Copyright Office, Copyright Liability of States and the Eleventh
1 The parties have not consented to the filing of this brief. No counsel for a party authored this brief in whole or in part; and no such counsel, any party, or any other person or entity---other than amicus curia---made a monetary contribution intended to fund the preparation or submission of this brief.
4 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 5 of 17
Amendment: A Report of the Register of Copyrights (June 1988) (“Register’s
Report”). 2
In response to that request, I and my staff at the Copyright Office solicited
and reviewed dozens of public comments in late 1987 and early 1988. After
completing that review, we reported to Congress on the “dire financial and other
repercussions that would flow from State Eleventh Amendment immunity for
damages in copyright infringement suits,” and noted the recent uptick of cases
finding States immune from copyright damages. Register’s Report, at ii-iii.
Congress’s decision to enact the CRCA was based, in large part, on that report and
on my subsequent testimony about the need for corrective legislation.
I respectfully submit this amicus brief to provide the Court with my first-
hand perspective of the evidence that we collected and reviewed. I have read, and
I fully embrace and support, the arguments propounded by plaintiffs in their
Motion for Reconsideration. The invocation of United States v. Georgia, 546 U.S.
151 (2006) adds a compelling new dimension to the plaintiffs’ motion, as I will
discuss below. Using the jargon of the sports world (appropriate in this case
involving a book about Texas A&M football), United States v. Georgia is a “game-
changer.”
2 Available at http://files.eric.ed.gov/fulltext/ED306963.pdf.
5 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 6 of 17
But first, with the indulgence of the Court, I will give a brief account of my
recollection of the legislative effort that led to enactment of the CRCA.
QUALIFICATIONS
As the Pravel Professorial Lecturer in Intellectual Property and Patent Law
at the George Washington University Law School, I have taught copyright law for
more than 27 years. I have 46 years of experience in domestic and international
copyright law and administration. My qualifications include my education,
training, and experience in the area of copyright legislation and U.S. Copyright
Office practice and procedure.
As noted above, from 1985 to 1994 I served as the Register of Copyrights of
the United States. As the Register of Copyrights, I was the chief government
official responsible for administering the U.S. copyright system. Among other
responsibilities, the Register of Copyrights makes rulings on the copyrightability of
works and supervises the work of the Registration Specialists who examine the
applications.
As the Register of Copyrights, I acted as principal advisor to Members of
Congress on copyright legislation and the state of the Copyright Office. I continue
in that advisory role at the George Washington University Law School. In
September 2008, I testified before the House Judiciary Committee on pending
copyright legislation, and in August 2009, I testified before the Senate Judiciary
6 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 7 of 17
Committee on a copyright bill that the Chairman, Senator Patrick Leahy of
Vermont, had introduced. I also participated in a hearing in 2014 with Rep. Jerold
Nadler, the current Chairman of the House Judiciary Committee.
Internationally, I represented the United States at official meetings and
diplomatic conferences, and I served as principal advisor to the U.S. Department of
State on copyright matters, including drafting, negotiating and implementing
copyright treaties. During my tenure as Register, I helped move the United States
into the Berne Convention for the Protection of Literary and Artistic Works, a goal
sought by U.S. Registers for over 100 years.
Before becoming Register, I served in several other government positions,
including Chief Counsel of the U.S. Senate Subcommittee on Patents, Copyrights,
and Trademarks. I also served, from 1975 through 1977, as Chief Minority
Counsel on the Subcommittee on Patents, Trademarks and Copyrights. In that
capacity, I participated in the final drafting and negotiations that led to passage of
the landmark U.S. Copyright Act of 1976, the current statue.
I am a graduate of Hamilton College (A.B., 1962) and Georgetown
University Law Center (J.D., 1973), where I served as Executive Editor of the
Georgetown Journal of International Law. I served two tours of duty as a Naval
Flight Officer with my squadron in Vietnam before entering law school. I am also
a former Foreign Service Officer in the U.S. diplomatic corps, having served two
7 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 8 of 17
years as Third Secretary of Embassy in Saudi Arabia. I am a Past President of the
Giles S. Rich American Inn of Court (Washington’s intellectual property Inn), a
former Trustee of the Copyright Society of the U.S.A., and Past Chair of the
Copyright Division of the ABA’s Intellectual Property Law Section. I now serve
as the Section’s Copyright Liaison to the World Intellectual Property Organization
(WIPO) in Geneva. I have been a frequent delegate at WIPO meetings, including
the series of meetings that led to the 1996 Diplomatic Conference that modernized
the Berne Convention and resulted in passage of the Digital Millennium Copyright
Act of 1998 in the United States. I also represented the ABA at the diplomatic
conference in Morocco in 2013 that adopted the Marrakech Treaty, which
facilitated access to copyrighted materials by the blind and visually impaired.
At George Washington University Law School, I teach two advanced
copyright seminars. Additionally, I authored a book entitled “Copyright: Engine
of Development,” published in 1995 in Paris by UNESCO. In 1993, I received the
International Book Award from the International Publishers Association, and, in
2009, I received the Jefferson Medal in recognition of my lifelong contribution to
intellectual property law.
8 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 9 of 17
ARGUMENT
The U.S. copyright law has a long pedigree. In 1787, the American people,
acting through their representatives in Philadelphia, adopted the copyright clause
of the U.S. Constitution. We were the first country to enshrine author’s rights in
the organic law of the land – in the Constitution itself.
Under that banner, from the thirteen coastal foot-holds of European
civilization that we’d carved out of the wilderness, we would launch the westward
drive of a uniquely American civilization. The United States made copyright a
central tenet of our culture. We recognized that financial incentives would drive
creativity and spur innovation. As we moved from scientific and cultural
backwater to economic powerhouse – in the process becoming the world’s leading
producer and exporter of scientific tracts and popular culture – copyright was with
us every step of the journey. Copyright helped us conquer and people the vast
tracts of the interior. Books, newspapers, maps and charts fired the imagination of
the pioneers and gave them courage. They read the diaries of the pathfinders; they
plotted their journey overland on the maps of Lewis and Clark; they navigated
around the Horn on the charts of Yankee sea captains. Once they reached their
promised land, “how-to” books on popular mechanics, medicine, agriculture, and
animal husbandry taught them how to tame the land, nurse the sick, and educate
their children. The copyright clause helped us build a great nation.
9 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 10 of 17
Over the years copyright has increased its reach and importance by
accommodating new technologies that have expanded the audience for creative
works. What started out in 1790 as protection for books, maps, and charts has
grown to embrace photographs, music, sound recordings, choreography, motion
pictures, radio, television, cable, architecture, video games, software, and now the
internet.
At each step in that technological evolution, the courts have played a key
role in defining the metes and bounds of copyright protection, often without any
guidance from Congress. The challenges to copyright posed by digital technology
– including peer-to-peer file sharing of sound recordings and motion pictures,
digital reproduction of books and photographs, and uncontrolled online
dissemination of all works – are many, and we continue to ask the courts to solve
copyright problems as they emerge, while keeping a weather eye on the underlying
constitutional purposes of copyright – to promote the Progress of Science.
In 1985 the Supreme Court handed down Atascadero State Hospital v.
Scanlon, 473 U.S. 234 (1985) the same year that I became Register, and the
liability of States for copyright infringement became an open question and an
important part of my life. I have been working on the issue for 35 years. In the
1976 Copyright Act, Congress thought it had imposed liability on the States
despite the constraints of the 11th Amendment, and the States acted accordingly.
10 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 11 of 17
They were respectful of copyright, and, mindful of potential liability, they spent
time and money educating their employees on the importance of respecting
copyrights. Of course, it was much easier for States in the 1970s to embrace
honorable copyright policies, before all of the new technologies changed our world
and made unlawful copying fast, easy, and cheap.
The Chairman of the House Subcommittee on Courts, Civil Liberties, and
the Administration of Justice, Robert W. Kastenmeier of Wisconsin, had
personally shepherded the 1976 Copyright Act through its 20-year extended
gestation to final enactment. He was an astute copyright lawyer, and a widely
respected constitutional lawyer as well. With Atascadero, he immediately saw its
implications for both copyrights and patents. Shortly thereafter, his staff began
informal consultations with the Copyright Office and with copyright experts in
academia. Finally, in 1987, he and the Subcommittee’s ranking Republican,
Carlos Moorhead of California, sent me a letter asking the Office to investigate
State sovereign immunity and its bearing on copyright infringement, and to prepare
a formal report on our findings. We issued the report, Copyright Liability of States
and the Eleventh Amendment: A Report of the Register of Copyright, in June of
1988, and it provided the factual basis for justifying and drafting corrective
legislation. We acknowledged that the report had its limitations. Without
subpoena power, we had to rely on information provided voluntarily by the States
11 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 12 of 17
themselves as to their waiver policies and their alternative State remedies, but
many of the States chose not to reply. We also recognized that the reports from the
private sector did not reflect the full picture of the magnitude of the threat. For one
thing, since 1978, the effective date of the Copyright Act of 1976, the States had
all assumed that they were fully liable for monetary damages for copyright
infringement, and they acted accordingly. I was often told by copyright owners
that the State actors usually settled quickly without litigation if infringements were
discovered. So the number of actual filed cases stayed low. Also, as mentioned
above, many of the digital technologies that would make infringing activity so
tempting to State actors were not yet in place, so the digital threat to copyright was
still mostly speculative. And, after Atascadero, many potential plaintiffs decided
to forego expensive litigation if they couldn’t win monetary damages and attorneys
fees. As a result, the Report’s list of copyright infringement suits against States or
State actors was relatively short.
Even so, Mr. Kastenmeier recognized that these numbers would jump in the
near future, as the digital revolution gathered momentum, as the States became
aware of their immunity from monetary liability, as many of them moved their
copyright awareness training programs to the back burner, and as the threat of
litigation waned and no longer acted as a deterrent to illegal State action. The
Chairman acted quickly to introduce legislation that would abrogate State
12 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 13 of 17
sovereign immunity for willful infringement, and under his leadership, and the
leadership of Senator Leahy, the bill moved through the House and Senate with
exceptional speed. In 1990, Congress enacted the Copyright Remedy Clarification
Act (CRCA), and President George H.W. Bush signed it into law.
Mr. Kastenmeier assumed that the courts would respect and rely on the
predictive judgment of Congress in enacting the measure, but he was disappointed.
Word spread that the CRCA would not pass constitutional muster after the
Supreme Court struck down the patent equivalent. Not unexpectedly, State
copyright infringements continued to multiply. After the Fifth Circuit decision in
Chavez v. Arte Publico Press, 204 F.3d 601 (5th Cir. 2000) the pace of
infringement accelerated. The use of pirated software by State universities and
State agencies rocketed, according to reports from the software industry. (See the
brief of The Software & Information Industry Association in Appendix B.)
California systematically reproduced tens of thousands of copyright-protected
newspaper and magazine articles without authorization or payment. (See the brief
of Dow Jones in Appendix C.) And professional photographers saw their works
used repeatedly by State government tourist agencies, without permission and
often without even the courtesy of a byline. (See generally, the brief of the
American Society of Media Photographers, Inc., and the National Press
Photographers Association the North American Nature Photography Association,
13 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 14 of 17
the Graphic Artists Guild, the Professional Photographers of America, American
Photographic Artists, and the Digital Media Licensing Association in Appendix
D.)
I attach in Appendix A of this brief a list of 166 copyright cases filed in
federal courts against States or State actors since the Chavez decision in 2000.
They were filed despite the futility of litigation after Chavez. These cases
therefore reflect only the tip of the infringement iceberg, but they also offer
compelling evidence of the growing magnitude of the problem.
I will not recount the history and holding of the Allen v. Cooper case, which
the parties have fully briefed. Even so, I note that Justice Kagan, in laying out the
roadmap for a congressional effort to enact a revised (and constitutionally sound)
version of the CRCA, has also given that roadmap to the U.S. District Courts. If a
district court judge, using his or her full measure of discretion, can tailor a remedy
that meets the Kagan requirements – that the remedy be “congruent” and
“proportional” to the harm done and the nature of the infringement – it will pass
constitutional muster. In this case, Texas A&M willfully and brazenly infringed
plaintiffs’ copyright in their unpublished manuscript. They removed the copyright
owners’ names. It effectively destroyed the potential market for the book by
sending hundreds of thousands of copies to sports-loving Texas A&M alumni.
Texas provides no state law remedy. If this Court were to direct a verdict for
14 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 15 of 17
plaintiffs that was “congruent” and “proportional” to the infringement, that verdict
would satisfy the Supreme Court. (See generally the brief of David Nimmer and
Ernest Young in Appendix E.)
Earlier, I mentioned the importance of the Supreme Court’s holding in U.S.
v. Georgia. As plaintiffs’ brief makes clear, that holding allows this Court to reject
the Texas assertion of sovereign immunity in this case because it results from an
unconstitutional taking without just compensation and without due process, in
violation of Section 5 of the 14th Amendment.
(Signature on following page)
15 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 16 of 17
CONCLUSION
Amicus Curiae Ralph Oman respectfully urges that the Motion for
Reconsideration be granted, and the case proceed on the merits.
Date: May 20, 2020 Respectfully submitted,
ARMSTRONG & LEE LLP
By: /s/ Joshua D. Lee Joshua D. Lee S.D. Tex. Bar No. 2696823 State Bar No. 24100139 2900 North Loop West, Ste. 830 Houston, Texas 77092 Telephone: (832) 709-1124 Facsimile: (832) 709-1125 jlee@armstronglee.com
Attorney for Amicus Curiae RALPH OMAN, Pravel, Hewitt, Kimball and Kreiger Professorial Lecturer in Intellectual Property and Patent Law, George Washington University Law School
16 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 17 of 17
CERTIFICATE OF SERVICE
I hereby certify that on May 20, 2020 I electronically filed a copy of this
Motion, as well as the attached proposed Brief Amicus Curiae by Ralph Oman,
using the CM/ECF System for the United States District Court for the Southern
District of Texas, which will send notification of that filing to all counsel of record
in this litigation.
By: /s/ Joshua D. Lee Joshua D. Lee
17 | 2020-05-20 | [
"Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 1 of 17 UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION MICHAEL J. BYNUM and § CANADA HOCKEY LLC § d/b/a EPIC SPORTS, § Civil Action No. 4:17-cv-00181 § Plaintiffs, § OMAN Amicus Brief § vs. § § TEXAS A&M UNIVERSITY § ATHLETIC § DEPARTMENT; TEXAS A&M § UNIVERSITY 12TH MAN § FOUNDATION; BRAD § MARQUARDT, in his individual § capacity; ALAN CANNON, in his § individual capacity; and LANE § STEPHENSON, in his individual § capacity, § § Defendants. § AMICUS CURIAE RALPH OMAN’S BRIEF IN SUPPORT OF PLAINTIFFS’ PENDING MOTION FOR RECONSIDERATION Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 2 of 17 TABLE OF CONTENTS TABLE OF AUTHORITIES ……………………………………………………….3 STATEMENT OF INTEREST OF AMICUS CURIAE …………………………...4 QUALIFICATIONS ………………………………………………………………..6 ARGUMENT……………………………………………………………………….9 CONCLUSION……………………………………………………………………16 2 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 3 of 17 TABLE OF AUTHORITIES Cases Allen v. Cooper 517 U.S. 44 (2020) Atascadero State Hospital v. Scanlon, 473 U.S. 234 (1985) Chavez v. Arte Publico Press, 204 F3d 601 (5th Cir.",
"2000) United States v. Georgia, 546 U.S. 151 (2006) Constitutional, Statutory, and Regulatory Provisions U.S. Const. art. I, § 8, cl. 8 Pub. L. No. 101`-553, 104 Stat. 2749 52 Fed. Reg. 42,045 (Nov. 2, 1987) Other Authorities Copyright Remedy Clarification Act and Copyright Office Report on Copyright Liability of States: Hearing on H.R. 1131 Before the Subcomn. on Courts, Intellectual Property, and the Administration of Justice of the H. Comm. On the Judiciary, 101st Cong. (1989) Letter from Reps. Robert W. Kastenmeier & Carlos Moorhead, H. Subcomm. On Courts, Civil Liberties, and the Administration of Justice, to Ralph Oman, Register of Copyrights (Aug. 3 1987) Letter from Ralph Oman, Register of Copyrights, to Reps. Robert W. Kastenmeier & Carlos Moorhead, H. Subcomm.",
"On Courts, Civil Liberties, and the Administration of Justice (June 27, 1988) U.S. Copyright Office, Copyright Liability of States and the Eleventh Amendment: A Report of Register of Copyrights (June 1988) 3 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 4 of 17 STATEMENT OF INTEREST OF AMICUS CURIAE1 I, Ralph Oman, submit this brief as amicus curiae in support of plaintiff’s Motion for Reconsideration. I submitted an amicus brief in Allen v. Cooper, 517 U.S. 44 (2020) and my name was mentioned expressly on several occasions during oral argument and in Justice Kagan’s written opinion. See, generally my amicus brief attached as Appendix F. I served as the Register of Copyrights of the United States from 1985 to 1994, and I am currently the Pravel, Hewitt, Kimball, and Kreiger Professorial Lecturer in Intellectual Property and Patent Law at the George Washington University Law School.",
"Before Congress passed the Copyright Remedy Clarification Act (“CRCA”) Pub. L. No. 101-553, 104 Stat. 2749 (1990), the U.S. House of Representatives asked me for “assistance with respect to the interplay between copyright infringement and the Eleventh Amendment,” and to investigate the “practical problems relative to the enforcement of copyright against state governments.” Letter from Reps. Robert W. Kastenmeier & Carlos Moorhead, H. Subcomm. on Courts, Civil Liberties & the Admin. of Justice, to Ralph Oman, Register of Copyrights, at 1 (Aug. 3, 1987) (“1987 Letter to Oman”), in U.S. Copyright Office, Copyright Liability of States and the Eleventh 1 The parties have not consented to the filing of this brief. No counsel for a party authored this brief in whole or in part; and no such counsel, any party, or any other person or entity---other than amicus curia---made a monetary contribution intended to fund the preparation or submission of this brief.",
"4 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 5 of 17 Amendment: A Report of the Register of Copyrights (June 1988) (“Register’s Report”). 2 In response to that request, I and my staff at the Copyright Office solicited and reviewed dozens of public comments in late 1987 and early 1988. After completing that review, we reported to Congress on the “dire financial and other repercussions that would flow from State Eleventh Amendment immunity for damages in copyright infringement suits,” and noted the recent uptick of cases finding States immune from copyright damages. Register’s Report, at ii-iii. Congress’s decision to enact the CRCA was based, in large part, on that report and on my subsequent testimony about the need for corrective legislation. I respectfully submit this amicus brief to provide the Court with my first- hand perspective of the evidence that we collected and reviewed. I have read, and I fully embrace and support, the arguments propounded by plaintiffs in their Motion for Reconsideration. The invocation of United States v. Georgia, 546 U.S. 151 (2006) adds a compelling new dimension to the plaintiffs’ motion, as I will discuss below. Using the jargon of the sports world (appropriate in this case involving a book about Texas A&M football), United States v. Georgia is a “game- changer.” 2 Available at http://files.eric.ed.gov/fulltext/ED306963.pdf. 5 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 6 of 17 But first, with the indulgence of the Court, I will give a brief account of my recollection of the legislative effort that led to enactment of the CRCA.",
"QUALIFICATIONS As the Pravel Professorial Lecturer in Intellectual Property and Patent Law at the George Washington University Law School, I have taught copyright law for more than 27 years. I have 46 years of experience in domestic and international copyright law and administration. My qualifications include my education, training, and experience in the area of copyright legislation and U.S. Copyright Office practice and procedure. As noted above, from 1985 to 1994 I served as the Register of Copyrights of the United States. As the Register of Copyrights, I was the chief government official responsible for administering the U.S. copyright system. Among other responsibilities, the Register of Copyrights makes rulings on the copyrightability of works and supervises the work of the Registration Specialists who examine the applications. As the Register of Copyrights, I acted as principal advisor to Members of Congress on copyright legislation and the state of the Copyright Office. I continue in that advisory role at the George Washington University Law School. In September 2008, I testified before the House Judiciary Committee on pending copyright legislation, and in August 2009, I testified before the Senate Judiciary 6 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 7 of 17 Committee on a copyright bill that the Chairman, Senator Patrick Leahy of Vermont, had introduced.",
"I also participated in a hearing in 2014 with Rep. Jerold Nadler, the current Chairman of the House Judiciary Committee. Internationally, I represented the United States at official meetings and diplomatic conferences, and I served as principal advisor to the U.S. Department of State on copyright matters, including drafting, negotiating and implementing copyright treaties. During my tenure as Register, I helped move the United States into the Berne Convention for the Protection of Literary and Artistic Works, a goal sought by U.S. Registers for over 100 years. Before becoming Register, I served in several other government positions, including Chief Counsel of the U.S. Senate Subcommittee on Patents, Copyrights, and Trademarks. I also served, from 1975 through 1977, as Chief Minority Counsel on the Subcommittee on Patents, Trademarks and Copyrights. In that capacity, I participated in the final drafting and negotiations that led to passage of the landmark U.S. Copyright Act of 1976, the current statue. I am a graduate of Hamilton College (A.B., 1962) and Georgetown University Law Center (J.D., 1973), where I served as Executive Editor of the Georgetown Journal of International Law. I served two tours of duty as a Naval Flight Officer with my squadron in Vietnam before entering law school. I am also a former Foreign Service Officer in the U.S. diplomatic corps, having served two 7 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 8 of 17 years as Third Secretary of Embassy in Saudi Arabia.",
"I am a Past President of the Giles S. Rich American Inn of Court (Washington’s intellectual property Inn), a former Trustee of the Copyright Society of the U.S.A., and Past Chair of the Copyright Division of the ABA’s Intellectual Property Law Section. I now serve as the Section’s Copyright Liaison to the World Intellectual Property Organization (WIPO) in Geneva. I have been a frequent delegate at WIPO meetings, including the series of meetings that led to the 1996 Diplomatic Conference that modernized the Berne Convention and resulted in passage of the Digital Millennium Copyright Act of 1998 in the United States. I also represented the ABA at the diplomatic conference in Morocco in 2013 that adopted the Marrakech Treaty, which facilitated access to copyrighted materials by the blind and visually impaired.",
"At George Washington University Law School, I teach two advanced copyright seminars. Additionally, I authored a book entitled “Copyright: Engine of Development,” published in 1995 in Paris by UNESCO. In 1993, I received the International Book Award from the International Publishers Association, and, in 2009, I received the Jefferson Medal in recognition of my lifelong contribution to intellectual property law. 8 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 9 of 17 ARGUMENT The U.S. copyright law has a long pedigree. In 1787, the American people, acting through their representatives in Philadelphia, adopted the copyright clause of the U.S. Constitution.",
"We were the first country to enshrine author’s rights in the organic law of the land – in the Constitution itself. Under that banner, from the thirteen coastal foot-holds of European civilization that we’d carved out of the wilderness, we would launch the westward drive of a uniquely American civilization. The United States made copyright a central tenet of our culture. We recognized that financial incentives would drive creativity and spur innovation. As we moved from scientific and cultural backwater to economic powerhouse – in the process becoming the world’s leading producer and exporter of scientific tracts and popular culture – copyright was with us every step of the journey. Copyright helped us conquer and people the vast tracts of the interior. Books, newspapers, maps and charts fired the imagination of the pioneers and gave them courage. They read the diaries of the pathfinders; they plotted their journey overland on the maps of Lewis and Clark; they navigated around the Horn on the charts of Yankee sea captains. Once they reached their promised land, “how-to” books on popular mechanics, medicine, agriculture, and animal husbandry taught them how to tame the land, nurse the sick, and educate their children.",
"The copyright clause helped us build a great nation. 9 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 10 of 17 Over the years copyright has increased its reach and importance by accommodating new technologies that have expanded the audience for creative works. What started out in 1790 as protection for books, maps, and charts has grown to embrace photographs, music, sound recordings, choreography, motion pictures, radio, television, cable, architecture, video games, software, and now the internet. At each step in that technological evolution, the courts have played a key role in defining the metes and bounds of copyright protection, often without any guidance from Congress. The challenges to copyright posed by digital technology – including peer-to-peer file sharing of sound recordings and motion pictures, digital reproduction of books and photographs, and uncontrolled online dissemination of all works – are many, and we continue to ask the courts to solve copyright problems as they emerge, while keeping a weather eye on the underlying constitutional purposes of copyright – to promote the Progress of Science.",
"In 1985 the Supreme Court handed down Atascadero State Hospital v. Scanlon, 473 U.S. 234 (1985) the same year that I became Register, and the liability of States for copyright infringement became an open question and an important part of my life. I have been working on the issue for 35 years. In the 1976 Copyright Act, Congress thought it had imposed liability on the States despite the constraints of the 11th Amendment, and the States acted accordingly. 10 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 11 of 17 They were respectful of copyright, and, mindful of potential liability, they spent time and money educating their employees on the importance of respecting copyrights. Of course, it was much easier for States in the 1970s to embrace honorable copyright policies, before all of the new technologies changed our world and made unlawful copying fast, easy, and cheap. The Chairman of the House Subcommittee on Courts, Civil Liberties, and the Administration of Justice, Robert W. Kastenmeier of Wisconsin, had personally shepherded the 1976 Copyright Act through its 20-year extended gestation to final enactment.",
"He was an astute copyright lawyer, and a widely respected constitutional lawyer as well. With Atascadero, he immediately saw its implications for both copyrights and patents. Shortly thereafter, his staff began informal consultations with the Copyright Office and with copyright experts in academia. Finally, in 1987, he and the Subcommittee’s ranking Republican, Carlos Moorhead of California, sent me a letter asking the Office to investigate State sovereign immunity and its bearing on copyright infringement, and to prepare a formal report on our findings. We issued the report, Copyright Liability of States and the Eleventh Amendment: A Report of the Register of Copyright, in June of 1988, and it provided the factual basis for justifying and drafting corrective legislation. We acknowledged that the report had its limitations. Without subpoena power, we had to rely on information provided voluntarily by the States 11 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 12 of 17 themselves as to their waiver policies and their alternative State remedies, but many of the States chose not to reply. We also recognized that the reports from the private sector did not reflect the full picture of the magnitude of the threat.",
"For one thing, since 1978, the effective date of the Copyright Act of 1976, the States had all assumed that they were fully liable for monetary damages for copyright infringement, and they acted accordingly. I was often told by copyright owners that the State actors usually settled quickly without litigation if infringements were discovered. So the number of actual filed cases stayed low. Also, as mentioned above, many of the digital technologies that would make infringing activity so tempting to State actors were not yet in place, so the digital threat to copyright was still mostly speculative. And, after Atascadero, many potential plaintiffs decided to forego expensive litigation if they couldn’t win monetary damages and attorneys fees.",
"As a result, the Report’s list of copyright infringement suits against States or State actors was relatively short. Even so, Mr. Kastenmeier recognized that these numbers would jump in the near future, as the digital revolution gathered momentum, as the States became aware of their immunity from monetary liability, as many of them moved their copyright awareness training programs to the back burner, and as the threat of litigation waned and no longer acted as a deterrent to illegal State action. The Chairman acted quickly to introduce legislation that would abrogate State 12 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 13 of 17 sovereign immunity for willful infringement, and under his leadership, and the leadership of Senator Leahy, the bill moved through the House and Senate with exceptional speed. In 1990, Congress enacted the Copyright Remedy Clarification Act (CRCA), and President George H.W.",
"Bush signed it into law. Mr. Kastenmeier assumed that the courts would respect and rely on the predictive judgment of Congress in enacting the measure, but he was disappointed. Word spread that the CRCA would not pass constitutional muster after the Supreme Court struck down the patent equivalent. Not unexpectedly, State copyright infringements continued to multiply. After the Fifth Circuit decision in Chavez v. Arte Publico Press, 204 F.3d 601 (5th Cir. 2000) the pace of infringement accelerated. The use of pirated software by State universities and State agencies rocketed, according to reports from the software industry. (See the brief of The Software & Information Industry Association in Appendix B.)",
"California systematically reproduced tens of thousands of copyright-protected newspaper and magazine articles without authorization or payment. (See the brief of Dow Jones in Appendix C.) And professional photographers saw their works used repeatedly by State government tourist agencies, without permission and often without even the courtesy of a byline. (See generally, the brief of the American Society of Media Photographers, Inc., and the National Press Photographers Association the North American Nature Photography Association, 13 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 14 of 17 the Graphic Artists Guild, the Professional Photographers of America, American Photographic Artists, and the Digital Media Licensing Association in Appendix D.) I attach in Appendix A of this brief a list of 166 copyright cases filed in federal courts against States or State actors since the Chavez decision in 2000. They were filed despite the futility of litigation after Chavez. These cases therefore reflect only the tip of the infringement iceberg, but they also offer compelling evidence of the growing magnitude of the problem. I will not recount the history and holding of the Allen v. Cooper case, which the parties have fully briefed. Even so, I note that Justice Kagan, in laying out the roadmap for a congressional effort to enact a revised (and constitutionally sound) version of the CRCA, has also given that roadmap to the U.S. District Courts.",
"If a district court judge, using his or her full measure of discretion, can tailor a remedy that meets the Kagan requirements – that the remedy be “congruent” and “proportional” to the harm done and the nature of the infringement – it will pass constitutional muster. In this case, Texas A&M willfully and brazenly infringed plaintiffs’ copyright in their unpublished manuscript. They removed the copyright owners’ names. It effectively destroyed the potential market for the book by sending hundreds of thousands of copies to sports-loving Texas A&M alumni. Texas provides no state law remedy. If this Court were to direct a verdict for 14 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 15 of 17 plaintiffs that was “congruent” and “proportional” to the infringement, that verdict would satisfy the Supreme Court. (See generally the brief of David Nimmer and Ernest Young in Appendix E.) Earlier, I mentioned the importance of the Supreme Court’s holding in U.S. v. Georgia. As plaintiffs’ brief makes clear, that holding allows this Court to reject the Texas assertion of sovereign immunity in this case because it results from an unconstitutional taking without just compensation and without due process, in violation of Section 5 of the 14th Amendment. (Signature on following page) 15 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 16 of 17 CONCLUSION Amicus Curiae Ralph Oman respectfully urges that the Motion for Reconsideration be granted, and the case proceed on the merits.",
"Date: May 20, 2020 Respectfully submitted, ARMSTRONG & LEE LLP By: /s/ Joshua D. Lee Joshua D. Lee S.D. Tex. Bar No. 2696823 State Bar No. 24100139 2900 North Loop West, Ste. 830 Houston, Texas 77092 Telephone: (832) 709-1124 Facsimile: (832) 709-1125 jlee@armstronglee.com Attorney for Amicus Curiae RALPH OMAN, Pravel, Hewitt, Kimball and Kreiger Professorial Lecturer in Intellectual Property and Patent Law, George Washington University Law School 16 Case 4:17-cv-00181 Document 134-1 Filed on 05/20/20 in TXSD Page 17 of 17 CERTIFICATE OF SERVICE I hereby certify that on May 20, 2020 I electronically filed a copy of this Motion, as well as the attached proposed Brief Amicus Curiae by Ralph Oman, using the CM/ECF System for the United States District Court for the Southern District of Texas, which will send notification of that filing to all counsel of record in this litigation.",
"By: /s/ Joshua D. Lee Joshua D. Lee 17"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/134233733/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
MEMORANDUM EDUARDO C. ROBRENO, District Judge. This case arises from the tragic murder of Bryan Harris by Cea Jay Chattin at Harris’s apartment on March 26, 2015. But the specific events giving rise to the claims *754in this case preceded the murder by fifteen hours and occurred at a different place, several miles from Harris’s apartment. According to the Amended Complaint, about fifteen hours before the murder, Chattin broke into the residence of Harris’s mother, Plaintiff Julie Heeter, and stole the gun that he later used to kill Harris. Plaintiffs residence was equipped with an alarm system that was manufactured, sold, or installed by Defendants ADT, LLC and the ADT Corporation (collectively, “ADT”), and Honeywell International, Inc. (“Honeywell”). When Chattin broke into Plaintiffs residence, the alarm system failed to notify either Plaintiff or the police that there was an intrusion. Plaintiff now seeks to hold ADT and Honeywell1 liable for the death of her son, Bryan Harris. Defendant ADT has filed a motion for judgment on the pleadings, and Defendant Honeywell has moved to dismiss. The decisive issue as to both motions is whether the failure of the ADT/Honeywell alarm system to notify the Heeters that an intruder, who turned out to be Chattin, had gained unauthorized access to their residence was the proximate cause of Bryan Harris’s death. I. FACTUAL BACKGROUND2 On or about October 11, 2014, a sales representative for Defendant ADT met with Plaintiff and her husband, Robert Heeter, at their weekend residence in Benton, Pennsylvania,3 for a security consultation and survey. Am. Compl. ¶¶ 15, 17-19. Plaintiff told the ADT representative that she was principally concerned with keeping certain individuals, including Chattin, off of her property. Id. ¶¶ 15, 23. She also stated that she was “not so much concerned about the property in the house but want[ed] a system that w[ould] alert [her and her husband] when someone comes into the house.” Id. ¶ 26(a). After negotiations,4 Plaintiff agreed to purchase the “ADT Pulse” system, which was installed at her residence on November 8, 2014. Id. ¶ 37. This system included a control panel allegedly manufactured by Honeywell. Id. ¶¶ 54, 83, 84. The “ADT Pulse” system also “operates using the Honeywell ‘LYNX PLUS’ a/k/a the ‘Safe-watch® QuickConnect Plus’” system. Id. ¶ 116. On March 26, 2015, at approximately 7:00 a.m., when the Heeters were not at their residence, Chattin entered through a window. Id. ¶ 53. He disconnected the phone lines for the alarm system and removed the system’s control panel from the wall. Id. ¶ 54. With the alarm system silenced, Chattin went to the location of the Heeters’ heirloom firearms and took the. 30 caliber rifle involved in this case. Id. ¶ 55. Chattin then proceeded to Harris’s apartment, which was located approx*755imately twenty minutes away, where he waited for Harris to return from work. Id, ¶ 57.-Plaintiff received no alert from the alarm system that an unnamed person had gained access to the residence and that the phone lines had been disconnected. Id. ¶ 65. When Harris returned to his apartment from work, he saw Chattin waiting for him, and the two men had a conversation outside of the apartment.5 Id. ¶ 58. Their conversation occurred at approximately 8:00 p.m.—twelve hours after Chattin had broken into Plaintiffs residence. Id After their conversation, Harris entered his apartment alone, watched television, and spoke with his employer on the phone at around 10:30 p.m. Id. ¶¶ 59-60. Sometime later that evening, Chattin entered Harris’s apartment and shot Harris in the face with the. 30 caliber rifle that he had stolen from Plaintiffs residence earlier that morning. Id. ¶ 61. Approximately fifteen hours had elapsed between the time that Chattin broke into Plaintiffs residence and the time that Chattin killed Harris with the. 30 caliber rifle he had stolen from Plaintiffs residence. Id. ¶ 89. The next day, before Plaintiff and her husband began their usual Friday trip to their weekend residence, Plaintiff called Harris, but he did not answer. Id. ¶¶ 62, 63. When she was approximately one hour away from their residence, Plaintiff logged into her phone’s ADT app, which did not indicate any intrusion had occurred. Id. ¶¶ 64, 65. When the Heeters arrived at their residence, they discovered that there had been “a burglary.” Id. ¶ 68. They immediately called Harris to ensure he was safe, but there was no answer.6 Id. Plaintiff called the police, id. ¶ 69, and Mr. Heeter called ADT, id. ¶ 70. ADT stated that it did not see any problem with the alarm system. Id. Later that evening, Harris’s employer found Harris’s body inside Harris’s apartment. Id. ¶ 76. According to the Amended Complaint, “[h]ad ADT alerted the authorities to the burglary in the early morning of March 26, Mr. Chattin would not have been able to murder Bryan Harris more than, and at least, fifteen hours later, unsuspectingly.” Id. ¶ 89. II. PROCEDURAL HISTORY Plaintiff initiated this action on February 3, 2016, alleging (1) fraud against Defendant ADT, (2) product liability for defective design against both Defendants, (3) negligence against both Defendants,7 (4) a wrongful death claim on behalf of Harris’s estate against both Defendants, (5) a survival act claim on behalf of Harris’s estate against both Defendants,8 and (6) a Penn*756sylvania Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), 73 Pa. Cons. Stat. §§ 201-1 to 201-9.3, claim against Defendant ADT. Plaintiff later moved for leave to file an Amended Complaint, ECF No. 27, which the Court granted, ECF No. 28. Defendant Honeywell moved to dismiss Plaintiffs Amended Complaint, ECF No. 30, and Defendant ADT filed a motion for judgment on the pleadings, ECF No. 38. Following a hearing, Defendants’ motions are now ripe for disposition. III. LEGAL STANDARD A party may move to dismiss a complaint for failure to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6), When considering such a motion, the Court must “accept as true all allegations in the complaint and all reasonable inferences that can be drawn therefrom, and view them in the light most favorable to the non-moving party.” DeBenedictis v. Merrill Lynch & Co., 492 F.3d 209, 215 (3d Cir.2007) (internal quotation marks omitted). To withstand a motion to dismiss, the complaint’s “[fjactual allegations must be enough to raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). This “requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. Although a plaintiff is entitled to all reasonable inferences from the facts alleged, a plaintiffs legal conclusions are not entitled to deference and the Court is “not bound to accept as true a legal conclusion couched as a factual allegation.” Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986). The pleadings must contain sufficient factual allegations so as to state a facially plausible claim for relief. See, e.g., Gelman v. State Farm Mut. Auto. Ins. Co., 583 F.3d 187, 190 (3d Cir.2009). “ ‘A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.’ ” Id. (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)). In deciding a Rule 12(b)(6) motion, a court limits its inquiry to the facts alleged in the complaint and its attachments, matters of public record, and undisputedly authentic documents if the complainant’s claims are based upon these documents. See Jordan v. Fox, Rothschild, O’Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir.1994); Pension Benefit Guar. Corp, v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir.1993). Federal Rule of Civil Procedure 12(c) provides that “[a]fter the pleadings are closed—but early enough not to delay trial—a party may move for judgment on the pleadings.” Fed. R. Civ. P. 12(c). Judgment on the pleadings is appropriate only if the moving party “clearly establishes that no material issue of fact remains to be resolved and that he is entitled to judgment as a matter of law.” Society Hill Civic Ass’n v. Harris, 632 F.2d 1045, 1054 (3d Cir.1980) (citation omitted). In reviewing a Rule 12(c) motion, a court “must view the facts presented in the pleadings and the inferences to be drawn therefrom in the light most favorable to the nonmoving party.” Rosenau v. Unifund Corp., 539 F.3d 218, 221 (3d Cir.2008) (quoting Jablonski v. Pan Am. World Airways, Inc., 863 F.2d 289, 290-91 (3d Cir.1988)). *757When a party’s Rule 12(c) motion is “based on the theory that the plaintiff failed to state a claim,” the motion is “reviewed under the same standards that apply to a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6).” Caprio v. Healthcare Revenue Recovery Grp., LLC, 709 F.3d 142, 146-47 (3d Cir.2013). IV. DISCUSSION Defendants raise several arguments as to why Plaintiffs claims should be dismissed. However, Plaintiffs claims against both Honeywell and ADT may be dismissed on one ground alone: neither Defendant’s conduct and/or products proximately caused Harris’s death. Causation under Pennsylvania law requires the existence of two separate components: cause-in-fact and proximate cause. Reott v. Asia Trend, Inc., 618 Pa. 228, 55 A.3d 1088, 1103 (2012). The components differ as follows: Cause in fact or “but for” causation requires proof that the harmful result would not have come about but for the conduct of the defendant. Proximate cause, in addition, requires proof that the defendant’s conduct was a substantial contributing factor in bringing about the harm alleged. Where the relevant facts show either that the defendant was not responsible for the injury, or that the causal connection between the defendant’s negligence and the plaintiffs injury is remote, the question of causation is decided by the court as a matter of law. Robertson v. Allied Signal, Inc., 914 F.2d 360, 366-67 (3d Cir.1990) (discussing Pennsylvania law). Proximate cause, not cause-in-fact, is the issue in this case. For relief to be granted as to each of Plaintiffs claims, Defendants’ allegedly tortious conduct and/or defective product must have been the proximate cause of the claimed harm. See Gruenwald v. Advanced Computer Applications, Inc., 730 A.2d 1004, 1014 (Pa.Super.Ct.1999) (in a fraud case, the plaintiff must establish that “the resulting injury was proximately caused by the reliance”); Weckel v. Carbondale Hous. Auth., 20 A.3d 1245, 1249 n. 9 (Pa,Commw.Ct.2011) (for a negligence claim, the plaintiff must establish that “the breach was the proximate cause of the plaintiffs injury”); see also Sikkelee v. Precision Airmotive Corp., 876 F.Supp.2d 479, 489 (M.D.Pa.2012) (“Strict liability also requires a showing that ... the defect was the proximate cause of the plaintiffs injuries.”); Baynes v. George E. Mason Funeral Home, Inc., No. 09-153, 2011 WL 2181469, at *6 (W.D.Pa. June 2, 2011) (stating that “the damages recoverable under the UTPCPL must be ... proximately "caused by the defendant’s actions”); Phillips v. Nw. Reg’l Commc’ns, 669 F.Supp.2d 555, 579 (W.D.Pa.2009) (wrongful death liability under Pennsylvania’s Wrongful Death Act, 42 Pa. Cons. Stat. § 8301, requires that defendant’s negligence caused the death, which includes establishing proximate cause); Holbrook v. Woodham, No. 05-304, 2008 WL 4425606, at *7-8 (W.D.Pa. Sept. 30, 2008) (survival action under Pennsylvania’s Survival Statute, 42 Pa. Cons. Stat. § 8302, requires establishing the elements of ' negligence claim, which include proximate cause). In the instant ease, Plaintiffs harms are predicated upon Harris’s death. Plaintiffs alleged harm in her personal capacity as Harris’s mother is mental pain and suffering, emotional distress, and the loss of her son’s care and comfort. Am. Compl. ¶¶ 94, 104, 128, 141. The alleged harm suffered by Harris’s estate, which is represented by Plaintiff as its administratrix, is fear of impending death, loss of life’s pleasures, loss of earnings, and death. Id. ¶¶ 105,127, 134, 142. Therefore, as to both sets of claims, the issue is the same: whether Defendants’ allegedly tortious conduct and/or defective products proximately caused Harris’s death. *758Pennsylvania courts utilize the “substantial factor” test from the Restatement (Second) of Torts (“the Restatement”) to ascertain proximate cause. Whitner v. Von Hintz, 437 Pa. 448, 263 A.2d 889, 893-94 (1970). At times, courts have been unclear as to whether this “substantial factor” determination is one of fact for the jury or one of law for the court. Recently, albeit in a nonprecedential opinion, Judge Fisher clarified the issue: The parties dispute the extent to which proximate cause may be determined by the court. [The plaintiff] maintains that proximate cause is an inherently fact-based question that should generally be resolved by a jury. See Ford v. Jeffries, 474 Pa. 588, [379 A.2d 111, 114 (1977)] (explaining that the issue of proximate cause “should not be taken from the jury if the jury may reasonably differ as to whether the conduct of the defendant was a substantial cause or an insignificant cause” (emphasis added)). [The defendants] counter that proximate cause is a question of law properly decided by the court. See Vattimo v. Lower Bucks Hosp., Inc., 502 Pa. 241 [465 A.2d 1231, 1233 (1983)] (recognizing that proximate cause is an issue of legal policy); Eckroth v. Pa. Elec., Inc., 12 A.3d 422, 427-28 (Pa.Super.Ct.2010) (stating that proximate cause is an issue of law for the court to determine). As Ford makes clear, however, nothing precludes a court from determining proximate cause as a matter of law if a jury could not reasonably differ on the issue. 379 A.2d at 114. Chetty Holdings Inc. v. NorthMarq Capital, LLC, 556 Fed.Appx. 118, 121 (3d Cir. 2014) (nonprecedential) (emphasis in original). To put it another way, where there is no issue of fact, the issue of proximate cause is one for the court to determine as a matter of law.9 ' *759The following considerations are deemed important under the Restatement’s “substantial factor” test to determine proximate cause: (1) the number of factors other than the actor’s conduct that contributed to producing the harm and the extent of their contribution; (2) whether the actor’s conduct created a force or series of forces that were in continuous and active operation up to the- time of the harm, or created -a situation harmless unless acted upon by other forces for which the actor is.not responsible; and (3) the lapse of time between the actor’s conduct and the harm. Vattimo, 465 A.2d at 1234; Restatement (Second)- of Torts § 433 (1965). The-Court will address these considerations seriatim. First, the Court considers the factórs— other than the failure of the alarm system, to which the Plaintiff attributes Harris’s murder—that contributed to producing the harm and the extent of their contribution. See Vattimo, 465 A.2d at 1234. The Superior Court of Pennsylvania relied heavily on this consideration in Brown v. Phila. Coll. of Osteopathic Med., 760 A.2d 863 (Pa.Super.Ct.2000), to determine that the defendant’s alleged negligence was not the proximate cause of the plaintiffs’ harm. Id at 872. In Brown, a couple alleged that the defendant-hospital, which erroneously diagnosed their newborn baby with syphilis, proximately caused the breakdown of their marriage, the husband’s physical violence toward the wife, and the wife’s loss of employment after she shot the husband. Id. at 866-67. A jury found in the plaintiffs’ favor, and the defendant appealed, arguing that the trial court erred by failing to grant judgment in the defendant’s favor because the plaintiffs failed to establish proximate cause.10 Id. at 867. The Pennsylvania court concluded that “it is abundantly clear that factors other than the negligence of [the defendant] had a far greater effect in producing the harm complained of by the [couple].” - Id. at 869. Other contributing ■ factors included the husband’s extramarital affair and confession of the affair to the wife, as well as the husband’s suspicions that the wife was having an affair herself. Id. Because those factors “had the greatest effect in bringing about the marital discord and eventual breakdown for which the couple [sought] compensation,” the court held that the defendant’s alleged negligence was so remote that, as a matter of law, the defendant could not be held liable for the plaintiffs’ harm. Id at 869. .Here, as in Brown, it is “abundantly clear” that factors other than Defendants’ alleged negligence and/or defective products had a substantially greater impact on the events leading to Harris’s death. See id. at 869. These contributing factors included Chattin’s “conscious disregard -for the well-being of .., Bryan Harris,” Am, Compl. ¶ 32; Chattin’s decision to “ma[ke] his way to the location of Heeter’s heirloom firearms and begin taking them out of the house,” id. ¶ 55; Chattin’s decision to “ma[ke] his way to Bryan Harris’s apartment, approximately twenty minutes away,” id. ¶ 57; and the fact that the murder was “pre-meditated,” id. ¶ 61. These factors “had" a far greater effect” than the allegedly defective alarm system in bringing about Harris’s death. See Brown, 760 A.2d at 869. Second, the Court considers whether Defendants’ actions and/or products created a force or series of forces that were in continuous and active operation up to the time of the harm, or created a situation harmless unless acted upon by other forces *760for which the actor is not responsible. See Vattimo, 465 A.2d at 1234. Mack v. AAA Mid-Atlantic, Inc., 511 F.Supp.2d 539 (E.D.Pa.2007), is a helpful example of this second consideration. In Mack, the plaintiff fell on an icy sidewalk after a tow truck driver, employed by the defendant-corporation, refused to provide the plaintiff with transportation. Id. at 542-43. Applying Pennsylvania law, the district court granted summary judgment 11 to the defendant because the driver’s failure to transport the plaintiff was not a substantial factor in bringing about the plaintiffs harm. Id at 546-47. The court explained that “Plaintiffs fall occurred in a location other than where the towing services were denied, on a sidewalk down the block from the parking lot” where the driver had towed her vehicle. Id. at 547. In other words, the denial of services, at most, initiated a sequence of events that required the plaintiff to walk and eventually slip on ice. See id. Instead of creating a force in continuous and active operation up to the time of the plaintiffs fall, the driver merely “created a situation harmless unless acted upon by other forces” for which the driver was not responsible. Id. The causal connection in this case is even more attenuated than the causal connection in Mack. The alarm system’s failure to notify Plaintiff that the, security perimeter of her residence had been breached did not initiate a sequence of events like the denial of services in Mack did. The sequence of events here was initiated long before, as evidenced by Plaintiffs preexisting cause for concern about Chattin, Am. Compl. ¶¶ 15, 23, 31, and Chattin’s preexisting “conscious disregard for the well-being ... of Bryan Harris,” id ¶ 32. The alarm system’s failure to notify Plaintiff did not cause Chattin to steal the. 30 caliber rifle, drive across town, wait for Harris to return from work, and eventually murder Harris. As such, the alarm system’s failure did not, in and of itself, create a harm that was in continuous and active operation up to the time of Harris’s murder. The alarm system’s failure merely created a situation harmless in itself unless and until acted upon by another force, namely Chattin, for which Defendants were not responsible. Similarly, in Eckroth v. Pennsylvania Electric, Inc., 12 A.3d 422 (Pa.Super.Ct.2010), the Superior Court of Pennsylvania affirmed the lower court’s grant of summary judgment because the defendant’s alleged negligence was not the proximate cause of the claimed harm. Id. at 424. The Eckroth defendant, an electric utility, disconnected the electricity to a home due to nonpayment. Id. at 425, Without electricity, the residents lit a candle, which was knocked over, starting a fire that killed several of the residents’ guests. Id. at 429. The court considered the defendant’s decision to terminate the power, the residents’ decision to forego battery-powered lighting in favor of candlelight, and the residents’-decision to leave an exposed and burning candle unattended during the night. Id. The court explained that “the residents’ election to forego inherently safe lighting in favor of using an unattended open flame .. during sleeping hours stands as an extraordinary breach of fire safety culminating in a fire not reasonably foreseeable as a normal and probable consequence of their loss of electric lighting nearly two days earlier.” Id. Thus, the court concluded that “[i]t seems highly extraordinary that [defendant’s] action could have caused [the residents] to make the decisions from which [the decedents’] harm directly flowed, such that we are compelled to conclude as a matter of law that [the defendant’s] alleged negligence was not *761the proximate cause of the tragic consequences that followed it.” Id. Here, as in Eckroth, it would seem “highly extraordinary” that Defendants’ allegedly tortious conduct and/or defective products caused Chattin to make the crucial decision to murder Harris—a decision from which Plaintiffs harm directly flowed. Third, the Court considers the lapse of time between the alleged tortious conduct and the harm. See Vattimo, 465 A.2d at 1234. Lapse of time alone is not sufficient to prevent an actor’s negligence from being the proximate cause of a harm. Taylor v. Jackson, 164 Pa.Cmwlth. 482, 643 A.2d 771, 776 (1994). Rather, it is to. be weighed alongside the other considerations set forth in the Restatement. For example, in Phillips v. Northwest Regional Communications, 669 F.Supp.2d 555, the administratrix of a decedent’s estate brought a wrongful death action against the county, the county’s 911 call center, the center’s supervisor, and center employees. Id. at 566-67. The killer was the decedent’s boyfriend, who was employed at a county 911 call center. Id. at 561. One day, while at work, the killer ran an unauthorized search for vehicle and address information related to the decedent. Id. That same day, away from the call center, the killer called his coworkers for directions to a specific address and the coworkers complied. Id. at 565. The killer’s requests were reported, and he was fired later that day. Id. at 566. He then purchased a pistol, ammunition, and handcuffs. Id Approximately twelve hours after the killer had called his coworkers and after “driving around” for a while, the killer went to the address for which he previously requested directions and shot the decedent, resulting in her death. Id. at 566, 572. The Phillips court found that the admin-istratrix could not establish proximate cause between the act of any individual defendant and the decedent’s, ultimate death. Id. at 579. The court explained that the shooting occurred more than twelve hours after the coworkers provided directions to addresses with which the killer was already familiar and “after several intervening events, e.g., [the decedent’s] telephone calls to [the killer] on the morning of [the day of the murder], his fiiing, and his purchase of a handgun.” Id. Here, like the killer in Phillips who spoke with coworkers and then drove around for a period of time before committing the murder, Chattin broke into Plaintiffs residence and then drove twenty minutes away to a different location to commit the murder. But the temporal lapse between the alarm’s failure to notify Plaintiff of the intrusion into her residence and Harris’s murder at Harris’s apartment (fifteen hours) is even greater than the lapse in Phillips (twelve hours). Therefore, given the length of time between the alarm system’s failure and Harris’s murder, as well as the several intervening events that transpired during that time span, the alarm system’s failure, like the coworkers’ actions in Phillips, was not a substantial factor in producing Harris’s death. In sum, taking the well-pleaded facts in Plaintiffs Amended Complaint as true and all reasonable inferences that can be drawn therefrom, even when construed in the light most favorable to Plaintiff, Plaintiff cannot show that Defendants’ proximately caused the claimed harm. Therefore, Plaintiff fails to state a facially plausible claim for fraud, negligence, defective design, or UTPCPL violation against Defendants. V. LEAVE TO AMEND The issue remains whether Plaintiff should be permitted to amend her complaint. Leave to amend shall be “freely *762give[n] ... when justice so requires.” Fed. R. Civ. P. 15(a)(2). The Court may decline to grant leave where the “plaintiffs delay in seeking amendment is undue, made in bad faith, prejudicial to the opposing party, or [the amendment] fails to cure the jurisdictional defect.” Berkshire Fashions, Inc. v. M.V. Hakusan II, 954 F.2d 874, 886 (3d Cir.1992). Leave to amend may also be denied if amendment would be futile. Alvin v. Suzuki, 227 F.3d 107, 121 (3d Cir.2000). “An amendment is futile if the amended complaint would not survive a motion to dismiss for failure to state a claim upon which relief could be granted.” Id. Here, further amendment would be futile because Plaintiffs claims could not survive a subsequent motion to dismiss or a renewed motion for judgment on the pleadings for lack of proximate cause. The Court will not grant Plaintiff leave to amend. VI. CONCLUSION For these reasons, the Court will grant Defendant Honeywell’s Motion to Dismiss, grant Defendant ADT’s Motion for Judgment on the Pleadings, and dismiss Plaintiffs Amended Complaint with prejudice. An appropriate order follows. ORDER AND NOW, this 1st day of July, 2016, after a hearing with the parties on June 14, 2016, and for the reasons set forth in the memorandum accompanying this order, it is hereby ORDERED as follows: (1) Defendant Honeywell International, Inc,’s Motion to Dismiss Amended Complaint (ECF No. 30) is GRANTED; (2) Defendant ADT LLC’s Motion for Judgment on the Pleadings (ECF No. 38) is GRANTED; (3) Plaintiffs Amended Complaint (ECF No. 29) is DISMISSED with prejudice; (4)The Clerk of the Court shall mark the above-captioned case as CLOSED. AND IT IS SO ORDERED.
. For the purposes of this motion, the Court will treat the liability of Honeywell, the manufacturer of part of the alarm system, and ADT, the installer and operator of the alarm system, as co-extensive.
. The facts are construed in the light most favorable to Plaintiff as the nonmoving party.
. Various terms are throughout the Amended Complaint to describe Plaintiff's residence in Benton, Pennsylvania, such as "weekend home,” "home,” “the house,” “residence,” and “the property.” See, e,g„ Am. Compl. ¶¶ 19, 23, 26(a), 32, 34, 37, 40, 53. For clarity, the location will be referred to as Plaintiff's “residence” or “weekend residence” throughout this decision.
.Plaintiff goes to great lengths in the Amended Complaint to describe her negotiations with the representative during this meeting, as well as her later discussions with the ADT installer. See Am. Compl. ¶¶ 19-38. However, these negotiations and discussions are immaterial to whether the alarm system’s failure to perform, which is admitted for the purposes of this motion, proximately caused Harris’s death—the ultimate issue in this case.
. The following information is not disclosed in the Amended Complaint: the nature of the relationship between Harris and Chattin; the subject matter of Chattin and Harris’s conversation outside of Harris's apartment; the basis or means by which Chattin gained access to Harris’s apartment; and why the Heeters feared that Chattin would harm Harris. But these factual gaps are ultimately irrelevant to the disposition of the case.
. The Amended Complaint does not explain why the Heeters called Harris at his apartment upon discovering that their residence had been “burglarized,” particularly when the Amended Complaint does not state that the Heeters immediately recognized that one or more guns were missing from their collection.
. Plaintiff has since withdrawn her negligence claim against Defendant Honeywell. ECF No. 40.
. In Pennsylvania, “[wjrongful death and survival actions are not substantive causes of action; rather, they provide a vehicle through which plaintiffs can recover for unlawful conduct that results in death.” Williams v. City of Scranton, No. 10-388, 2013 WL 1339027, at *13 n. 7 (M.D.Pa. Apr. 1, 2013) (quoting Sullivan v, Warminster Twp., 765 F.Supp.2d 687, *756707 (E.D.Pa.2011)). Therefore, recovery by Harris’s estate is contingent on the success of the substantive tort claims.
. There may be no question of fact where the parties stipulate to the facts, no reasonable jury could differ, or the facts in the complaint are taken as true and in the light most favorable to the plaintiff. These events occur at various stages in a case’s lifespan. But at each of these stages, the Court applies the same substantive law to determine whether the facts that a plaintiff has alleged (in the case of a Rule 12(b)(6) pre-answer motion or Rule 12(c) post-answer motion) or shown (in the case of a Rule 50(b) post-verdict motion or Rule 56 pre-trial motion) malee out a legally cognizable claim. See Caprio, 709 F.3d at 146-47 (explaining that a Rule 12(c) motion "based on the theory that the plaintiff failed to state a claim ... is reviewed under the same standards that apply to a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6)”); Huggins v. Zaloga, No. 11-2061, 2013 WL 1330812, at *3 (M.D.Pa. Mar. 29, 2013) (citing Mele v. Fed. Reserve Bank of N.Y., 359 F.3d 251, 257 (3d Cir.2004)) (explaining that Rule 12(c)'s focus on the pleadings is "[t]he one significant difference” between the resolution of Rule 12(c) and Rule 56 motions); LBL Skysystems (USA), Inc. v. APG-Am., Inc., 319 F.Supp.2d 515, 525 (E.D.Pa.2004)(“The standards for a judgment as a matter of law under Rule 50(b) mirrors the standard for summary judgment under ... Rule 56(e).”). Accordingly, because the Court takes Plaintiff's factual allegations as true, in order to determine whether Plaintiff has alleged a plausible claim under Rules 12(b)(6) and 12(c) in this case, other cases decided under Rules 50 and 56 are helpful to discern the legal standard under Pennsylvania law and how courts have applied it. See, e.g„ Twombly, 550 U.S. at 553, 127 S.Ct. 1955 (looking to Theatre Enterprises, Inc. v. Paramount Film Distributing Corp., 346 U.S. 537, 540, 74 S.Ct. 257, 98 L.Ed. 273 (1954), an opinion rendered at the summary judgment stage, to determine the substantive legal standard to apply at the pleading stage); Boice ex rel. Rought v. Tyler Mem'l Hosp., No. 06-1709, 2007 WL 2903424, at 6 (M.D.Pa. Sept. 28, 2007) (citing Brown v. Phila. Coll. of Osteopathic Med., 760 A.2d 863, 868 (Pa.Super.Ct.2000), an opinion rendered at the Rule 50 stage, to determine the applicable causation standard for a claim at the pleading stage).
. See supra n.9.
. See supra n.9. | 07-25-2022 | [
"MEMORANDUM EDUARDO C. ROBRENO, District Judge. This case arises from the tragic murder of Bryan Harris by Cea Jay Chattin at Harris’s apartment on March 26, 2015. But the specific events giving rise to the claims *754in this case preceded the murder by fifteen hours and occurred at a different place, several miles from Harris’s apartment. According to the Amended Complaint, about fifteen hours before the murder, Chattin broke into the residence of Harris’s mother, Plaintiff Julie Heeter, and stole the gun that he later used to kill Harris. Plaintiffs residence was equipped with an alarm system that was manufactured, sold, or installed by Defendants ADT, LLC and the ADT Corporation (collectively, “ADT”), and Honeywell International, Inc. (“Honeywell”). When Chattin broke into Plaintiffs residence, the alarm system failed to notify either Plaintiff or the police that there was an intrusion.",
"Plaintiff now seeks to hold ADT and Honeywell1 liable for the death of her son, Bryan Harris. Defendant ADT has filed a motion for judgment on the pleadings, and Defendant Honeywell has moved to dismiss. The decisive issue as to both motions is whether the failure of the ADT/Honeywell alarm system to notify the Heeters that an intruder, who turned out to be Chattin, had gained unauthorized access to their residence was the proximate cause of Bryan Harris’s death. I. FACTUAL BACKGROUND2 On or about October 11, 2014, a sales representative for Defendant ADT met with Plaintiff and her husband, Robert Heeter, at their weekend residence in Benton, Pennsylvania,3 for a security consultation and survey.",
"Am. Compl. ¶¶ 15, 17-19. Plaintiff told the ADT representative that she was principally concerned with keeping certain individuals, including Chattin, off of her property. Id. ¶¶ 15, 23. She also stated that she was “not so much concerned about the property in the house but want[ed] a system that w[ould] alert [her and her husband] when someone comes into the house.” Id. ¶ 26(a). After negotiations,4 Plaintiff agreed to purchase the “ADT Pulse” system, which was installed at her residence on November 8, 2014. Id. ¶ 37.",
"This system included a control panel allegedly manufactured by Honeywell. Id. ¶¶ 54, 83, 84. The “ADT Pulse” system also “operates using the Honeywell ‘LYNX PLUS’ a/k/a the ‘Safe-watch® QuickConnect Plus’” system. Id. ¶ 116. On March 26, 2015, at approximately 7:00 a.m., when the Heeters were not at their residence, Chattin entered through a window. Id. ¶ 53. He disconnected the phone lines for the alarm system and removed the system’s control panel from the wall. Id. ¶ 54. With the alarm system silenced, Chattin went to the location of the Heeters’ heirloom firearms and took the. 30 caliber rifle involved in this case. Id. ¶ 55. Chattin then proceeded to Harris’s apartment, which was located approx*755imately twenty minutes away, where he waited for Harris to return from work.",
"Id, ¶ 57.-Plaintiff received no alert from the alarm system that an unnamed person had gained access to the residence and that the phone lines had been disconnected. Id. ¶ 65. When Harris returned to his apartment from work, he saw Chattin waiting for him, and the two men had a conversation outside of the apartment.5 Id. ¶ 58. Their conversation occurred at approximately 8:00 p.m.—twelve hours after Chattin had broken into Plaintiffs residence. Id After their conversation, Harris entered his apartment alone, watched television, and spoke with his employer on the phone at around 10:30 p.m. Id. ¶¶ 59-60. Sometime later that evening, Chattin entered Harris’s apartment and shot Harris in the face with the. 30 caliber rifle that he had stolen from Plaintiffs residence earlier that morning. Id. ¶ 61. Approximately fifteen hours had elapsed between the time that Chattin broke into Plaintiffs residence and the time that Chattin killed Harris with the.",
"30 caliber rifle he had stolen from Plaintiffs residence. Id. ¶ 89. The next day, before Plaintiff and her husband began their usual Friday trip to their weekend residence, Plaintiff called Harris, but he did not answer. Id. ¶¶ 62, 63. When she was approximately one hour away from their residence, Plaintiff logged into her phone’s ADT app, which did not indicate any intrusion had occurred. Id. ¶¶ 64, 65. When the Heeters arrived at their residence, they discovered that there had been “a burglary.” Id. ¶ 68. They immediately called Harris to ensure he was safe, but there was no answer.6 Id. Plaintiff called the police, id. ¶ 69, and Mr. Heeter called ADT, id. ¶ 70. ADT stated that it did not see any problem with the alarm system. Id. Later that evening, Harris’s employer found Harris’s body inside Harris’s apartment. Id. ¶ 76. According to the Amended Complaint, “[h]ad ADT alerted the authorities to the burglary in the early morning of March 26, Mr. Chattin would not have been able to murder Bryan Harris more than, and at least, fifteen hours later, unsuspectingly.” Id.",
"¶ 89. II. PROCEDURAL HISTORY Plaintiff initiated this action on February 3, 2016, alleging (1) fraud against Defendant ADT, (2) product liability for defective design against both Defendants, (3) negligence against both Defendants,7 (4) a wrongful death claim on behalf of Harris’s estate against both Defendants, (5) a survival act claim on behalf of Harris’s estate against both Defendants,8 and (6) a Penn*756sylvania Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), 73 Pa. Cons. Stat. §§ 201-1 to 201-9.3, claim against Defendant ADT. Plaintiff later moved for leave to file an Amended Complaint, ECF No. 27, which the Court granted, ECF No. 28. Defendant Honeywell moved to dismiss Plaintiffs Amended Complaint, ECF No. 30, and Defendant ADT filed a motion for judgment on the pleadings, ECF No. 38.",
"Following a hearing, Defendants’ motions are now ripe for disposition. III. LEGAL STANDARD A party may move to dismiss a complaint for failure to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6), When considering such a motion, the Court must “accept as true all allegations in the complaint and all reasonable inferences that can be drawn therefrom, and view them in the light most favorable to the non-moving party.” DeBenedictis v. Merrill Lynch & Co., 492 F.3d 209, 215 (3d Cir.2007) (internal quotation marks omitted). To withstand a motion to dismiss, the complaint’s “[fjactual allegations must be enough to raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). This “requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id.",
"Although a plaintiff is entitled to all reasonable inferences from the facts alleged, a plaintiffs legal conclusions are not entitled to deference and the Court is “not bound to accept as true a legal conclusion couched as a factual allegation.” Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986). The pleadings must contain sufficient factual allegations so as to state a facially plausible claim for relief. See, e.g., Gelman v. State Farm Mut. Auto. Ins. Co., 583 F.3d 187, 190 (3d Cir.2009). “ ‘A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.’ ” Id. (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)). In deciding a Rule 12(b)(6) motion, a court limits its inquiry to the facts alleged in the complaint and its attachments, matters of public record, and undisputedly authentic documents if the complainant’s claims are based upon these documents. See Jordan v. Fox, Rothschild, O’Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir.1994); Pension Benefit Guar. Corp, v. White Consol.",
"Indus., Inc., 998 F.2d 1192, 1196 (3d Cir.1993). Federal Rule of Civil Procedure 12(c) provides that “[a]fter the pleadings are closed—but early enough not to delay trial—a party may move for judgment on the pleadings.” Fed. R. Civ. P. 12(c). Judgment on the pleadings is appropriate only if the moving party “clearly establishes that no material issue of fact remains to be resolved and that he is entitled to judgment as a matter of law.” Society Hill Civic Ass’n v. Harris, 632 F.2d 1045, 1054 (3d Cir.1980) (citation omitted). In reviewing a Rule 12(c) motion, a court “must view the facts presented in the pleadings and the inferences to be drawn therefrom in the light most favorable to the nonmoving party.” Rosenau v. Unifund Corp., 539 F.3d 218, 221 (3d Cir.2008) (quoting Jablonski v. Pan Am. World Airways, Inc., 863 F.2d 289, 290-91 (3d Cir.1988)). *757When a party’s Rule 12(c) motion is “based on the theory that the plaintiff failed to state a claim,” the motion is “reviewed under the same standards that apply to a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6).” Caprio v. Healthcare Revenue Recovery Grp., LLC, 709 F.3d 142, 146-47 (3d Cir.2013). IV.",
"DISCUSSION Defendants raise several arguments as to why Plaintiffs claims should be dismissed. However, Plaintiffs claims against both Honeywell and ADT may be dismissed on one ground alone: neither Defendant’s conduct and/or products proximately caused Harris’s death. Causation under Pennsylvania law requires the existence of two separate components: cause-in-fact and proximate cause. Reott v. Asia Trend, Inc., 618 Pa. 228, 55 A.3d 1088, 1103 (2012). The components differ as follows: Cause in fact or “but for” causation requires proof that the harmful result would not have come about but for the conduct of the defendant. Proximate cause, in addition, requires proof that the defendant’s conduct was a substantial contributing factor in bringing about the harm alleged. Where the relevant facts show either that the defendant was not responsible for the injury, or that the causal connection between the defendant’s negligence and the plaintiffs injury is remote, the question of causation is decided by the court as a matter of law.",
"Robertson v. Allied Signal, Inc., 914 F.2d 360, 366-67 (3d Cir.1990) (discussing Pennsylvania law). Proximate cause, not cause-in-fact, is the issue in this case. For relief to be granted as to each of Plaintiffs claims, Defendants’ allegedly tortious conduct and/or defective product must have been the proximate cause of the claimed harm. See Gruenwald v. Advanced Computer Applications, Inc., 730 A.2d 1004, 1014 (Pa.Super.Ct.1999) (in a fraud case, the plaintiff must establish that “the resulting injury was proximately caused by the reliance”); Weckel v. Carbondale Hous. Auth., 20 A.3d 1245, 1249 n. 9 (Pa,Commw.Ct.2011) (for a negligence claim, the plaintiff must establish that “the breach was the proximate cause of the plaintiffs injury”); see also Sikkelee v. Precision Airmotive Corp., 876 F.Supp.2d 479, 489 (M.D.Pa.2012) (“Strict liability also requires a showing that ... the defect was the proximate cause of the plaintiffs injuries.”); Baynes v. George E. Mason Funeral Home, Inc., No. 09-153, 2011 WL 2181469, at *6 (W.D.Pa. June 2, 2011) (stating that “the damages recoverable under the UTPCPL must be ... proximately \"caused by the defendant’s actions”); Phillips v. Nw. Reg’l Commc’ns, 669 F.Supp.2d 555, 579 (W.D.Pa.2009) (wrongful death liability under Pennsylvania’s Wrongful Death Act, 42 Pa. Cons. Stat.",
"§ 8301, requires that defendant’s negligence caused the death, which includes establishing proximate cause); Holbrook v. Woodham, No. 05-304, 2008 WL 4425606, at *7-8 (W.D.Pa. Sept. 30, 2008) (survival action under Pennsylvania’s Survival Statute, 42 Pa. Cons. Stat. § 8302, requires establishing the elements of ' negligence claim, which include proximate cause). In the instant ease, Plaintiffs harms are predicated upon Harris’s death. Plaintiffs alleged harm in her personal capacity as Harris’s mother is mental pain and suffering, emotional distress, and the loss of her son’s care and comfort. Am. Compl. ¶¶ 94, 104, 128, 141.",
"The alleged harm suffered by Harris’s estate, which is represented by Plaintiff as its administratrix, is fear of impending death, loss of life’s pleasures, loss of earnings, and death. Id. ¶¶ 105,127, 134, 142. Therefore, as to both sets of claims, the issue is the same: whether Defendants’ allegedly tortious conduct and/or defective products proximately caused Harris’s death. *758Pennsylvania courts utilize the “substantial factor” test from the Restatement (Second) of Torts (“the Restatement”) to ascertain proximate cause. Whitner v. Von Hintz, 437 Pa. 448, 263 A.2d 889, 893-94 (1970). At times, courts have been unclear as to whether this “substantial factor” determination is one of fact for the jury or one of law for the court. Recently, albeit in a nonprecedential opinion, Judge Fisher clarified the issue: The parties dispute the extent to which proximate cause may be determined by the court.",
"[The plaintiff] maintains that proximate cause is an inherently fact-based question that should generally be resolved by a jury. See Ford v. Jeffries, 474 Pa. 588, [379 A.2d 111, 114 (1977)] (explaining that the issue of proximate cause “should not be taken from the jury if the jury may reasonably differ as to whether the conduct of the defendant was a substantial cause or an insignificant cause” (emphasis added)). [The defendants] counter that proximate cause is a question of law properly decided by the court. See Vattimo v. Lower Bucks Hosp., Inc., 502 Pa. 241 [465 A.2d 1231, 1233 (1983)] (recognizing that proximate cause is an issue of legal policy); Eckroth v. Pa. Elec., Inc., 12 A.3d 422, 427-28 (Pa.Super.Ct.2010) (stating that proximate cause is an issue of law for the court to determine). As Ford makes clear, however, nothing precludes a court from determining proximate cause as a matter of law if a jury could not reasonably differ on the issue.",
"379 A.2d at 114. Chetty Holdings Inc. v. NorthMarq Capital, LLC, 556 Fed.Appx. 118, 121 (3d Cir. 2014) (nonprecedential) (emphasis in original). To put it another way, where there is no issue of fact, the issue of proximate cause is one for the court to determine as a matter of law.9 ' *759The following considerations are deemed important under the Restatement’s “substantial factor” test to determine proximate cause: (1) the number of factors other than the actor’s conduct that contributed to producing the harm and the extent of their contribution; (2) whether the actor’s conduct created a force or series of forces that were in continuous and active operation up to the- time of the harm, or created -a situation harmless unless acted upon by other forces for which the actor is.not responsible; and (3) the lapse of time between the actor’s conduct and the harm.",
"Vattimo, 465 A.2d at 1234; Restatement (Second)- of Torts § 433 (1965). The-Court will address these considerations seriatim. First, the Court considers the factórs— other than the failure of the alarm system, to which the Plaintiff attributes Harris’s murder—that contributed to producing the harm and the extent of their contribution. See Vattimo, 465 A.2d at 1234. The Superior Court of Pennsylvania relied heavily on this consideration in Brown v. Phila. Coll. of Osteopathic Med., 760 A.2d 863 (Pa.Super.Ct.2000), to determine that the defendant’s alleged negligence was not the proximate cause of the plaintiffs’ harm. Id at 872. In Brown, a couple alleged that the defendant-hospital, which erroneously diagnosed their newborn baby with syphilis, proximately caused the breakdown of their marriage, the husband’s physical violence toward the wife, and the wife’s loss of employment after she shot the husband. Id.",
"at 866-67. A jury found in the plaintiffs’ favor, and the defendant appealed, arguing that the trial court erred by failing to grant judgment in the defendant’s favor because the plaintiffs failed to establish proximate cause.10 Id. at 867. The Pennsylvania court concluded that “it is abundantly clear that factors other than the negligence of [the defendant] had a far greater effect in producing the harm complained of by the [couple].” - Id. at 869. Other contributing ■ factors included the husband’s extramarital affair and confession of the affair to the wife, as well as the husband’s suspicions that the wife was having an affair herself. Id. Because those factors “had the greatest effect in bringing about the marital discord and eventual breakdown for which the couple [sought] compensation,” the court held that the defendant’s alleged negligence was so remote that, as a matter of law, the defendant could not be held liable for the plaintiffs’ harm.",
"Id at 869. .Here, as in Brown, it is “abundantly clear” that factors other than Defendants’ alleged negligence and/or defective products had a substantially greater impact on the events leading to Harris’s death. See id. at 869. These contributing factors included Chattin’s “conscious disregard -for the well-being of .., Bryan Harris,” Am, Compl. ¶ 32; Chattin’s decision to “ma[ke] his way to the location of Heeter’s heirloom firearms and begin taking them out of the house,” id. ¶ 55; Chattin’s decision to “ma[ke] his way to Bryan Harris’s apartment, approximately twenty minutes away,” id. ¶ 57; and the fact that the murder was “pre-meditated,” id. ¶ 61. These factors “had\" a far greater effect” than the allegedly defective alarm system in bringing about Harris’s death.",
"See Brown, 760 A.2d at 869. Second, the Court considers whether Defendants’ actions and/or products created a force or series of forces that were in continuous and active operation up to the time of the harm, or created a situation harmless unless acted upon by other forces *760for which the actor is not responsible. See Vattimo, 465 A.2d at 1234. Mack v. AAA Mid-Atlantic, Inc., 511 F.Supp.2d 539 (E.D.Pa.2007), is a helpful example of this second consideration. In Mack, the plaintiff fell on an icy sidewalk after a tow truck driver, employed by the defendant-corporation, refused to provide the plaintiff with transportation. Id. at 542-43.",
"Applying Pennsylvania law, the district court granted summary judgment 11 to the defendant because the driver’s failure to transport the plaintiff was not a substantial factor in bringing about the plaintiffs harm. Id at 546-47. The court explained that “Plaintiffs fall occurred in a location other than where the towing services were denied, on a sidewalk down the block from the parking lot” where the driver had towed her vehicle. Id. at 547. In other words, the denial of services, at most, initiated a sequence of events that required the plaintiff to walk and eventually slip on ice.",
"See id. Instead of creating a force in continuous and active operation up to the time of the plaintiffs fall, the driver merely “created a situation harmless unless acted upon by other forces” for which the driver was not responsible. Id. The causal connection in this case is even more attenuated than the causal connection in Mack. The alarm system’s failure to notify Plaintiff that the, security perimeter of her residence had been breached did not initiate a sequence of events like the denial of services in Mack did. The sequence of events here was initiated long before, as evidenced by Plaintiffs preexisting cause for concern about Chattin, Am. Compl. ¶¶ 15, 23, 31, and Chattin’s preexisting “conscious disregard for the well-being ... of Bryan Harris,” id ¶ 32. The alarm system’s failure to notify Plaintiff did not cause Chattin to steal the.",
"30 caliber rifle, drive across town, wait for Harris to return from work, and eventually murder Harris. As such, the alarm system’s failure did not, in and of itself, create a harm that was in continuous and active operation up to the time of Harris’s murder. The alarm system’s failure merely created a situation harmless in itself unless and until acted upon by another force, namely Chattin, for which Defendants were not responsible. Similarly, in Eckroth v. Pennsylvania Electric, Inc., 12 A.3d 422 (Pa.Super.Ct.2010), the Superior Court of Pennsylvania affirmed the lower court’s grant of summary judgment because the defendant’s alleged negligence was not the proximate cause of the claimed harm. Id. at 424.",
"The Eckroth defendant, an electric utility, disconnected the electricity to a home due to nonpayment. Id. at 425, Without electricity, the residents lit a candle, which was knocked over, starting a fire that killed several of the residents’ guests. Id. at 429. The court considered the defendant’s decision to terminate the power, the residents’ decision to forego battery-powered lighting in favor of candlelight, and the residents’-decision to leave an exposed and burning candle unattended during the night. Id. The court explained that “the residents’ election to forego inherently safe lighting in favor of using an unattended open flame .. during sleeping hours stands as an extraordinary breach of fire safety culminating in a fire not reasonably foreseeable as a normal and probable consequence of their loss of electric lighting nearly two days earlier.” Id. Thus, the court concluded that “[i]t seems highly extraordinary that [defendant’s] action could have caused [the residents] to make the decisions from which [the decedents’] harm directly flowed, such that we are compelled to conclude as a matter of law that [the defendant’s] alleged negligence was not *761the proximate cause of the tragic consequences that followed it.” Id.",
"Here, as in Eckroth, it would seem “highly extraordinary” that Defendants’ allegedly tortious conduct and/or defective products caused Chattin to make the crucial decision to murder Harris—a decision from which Plaintiffs harm directly flowed. Third, the Court considers the lapse of time between the alleged tortious conduct and the harm. See Vattimo, 465 A.2d at 1234. Lapse of time alone is not sufficient to prevent an actor’s negligence from being the proximate cause of a harm. Taylor v. Jackson, 164 Pa.Cmwlth. 482, 643 A.2d 771, 776 (1994). Rather, it is to. be weighed alongside the other considerations set forth in the Restatement. For example, in Phillips v. Northwest Regional Communications, 669 F.Supp.2d 555, the administratrix of a decedent’s estate brought a wrongful death action against the county, the county’s 911 call center, the center’s supervisor, and center employees. Id. at 566-67. The killer was the decedent’s boyfriend, who was employed at a county 911 call center. Id. at 561. One day, while at work, the killer ran an unauthorized search for vehicle and address information related to the decedent. Id.",
"That same day, away from the call center, the killer called his coworkers for directions to a specific address and the coworkers complied. Id. at 565. The killer’s requests were reported, and he was fired later that day. Id. at 566. He then purchased a pistol, ammunition, and handcuffs. Id Approximately twelve hours after the killer had called his coworkers and after “driving around” for a while, the killer went to the address for which he previously requested directions and shot the decedent, resulting in her death.",
"Id. at 566, 572. The Phillips court found that the admin-istratrix could not establish proximate cause between the act of any individual defendant and the decedent’s, ultimate death. Id. at 579. The court explained that the shooting occurred more than twelve hours after the coworkers provided directions to addresses with which the killer was already familiar and “after several intervening events, e.g., [the decedent’s] telephone calls to [the killer] on the morning of [the day of the murder], his fiiing, and his purchase of a handgun.” Id. Here, like the killer in Phillips who spoke with coworkers and then drove around for a period of time before committing the murder, Chattin broke into Plaintiffs residence and then drove twenty minutes away to a different location to commit the murder. But the temporal lapse between the alarm’s failure to notify Plaintiff of the intrusion into her residence and Harris’s murder at Harris’s apartment (fifteen hours) is even greater than the lapse in Phillips (twelve hours).",
"Therefore, given the length of time between the alarm system’s failure and Harris’s murder, as well as the several intervening events that transpired during that time span, the alarm system’s failure, like the coworkers’ actions in Phillips, was not a substantial factor in producing Harris’s death. In sum, taking the well-pleaded facts in Plaintiffs Amended Complaint as true and all reasonable inferences that can be drawn therefrom, even when construed in the light most favorable to Plaintiff, Plaintiff cannot show that Defendants’ proximately caused the claimed harm. Therefore, Plaintiff fails to state a facially plausible claim for fraud, negligence, defective design, or UTPCPL violation against Defendants. V. LEAVE TO AMEND The issue remains whether Plaintiff should be permitted to amend her complaint.",
"Leave to amend shall be “freely *762give[n] ... when justice so requires.” Fed. R. Civ. P. 15(a)(2). The Court may decline to grant leave where the “plaintiffs delay in seeking amendment is undue, made in bad faith, prejudicial to the opposing party, or [the amendment] fails to cure the jurisdictional defect.” Berkshire Fashions, Inc. v. M.V. Hakusan II, 954 F.2d 874, 886 (3d Cir.1992). Leave to amend may also be denied if amendment would be futile.",
"Alvin v. Suzuki, 227 F.3d 107, 121 (3d Cir.2000). “An amendment is futile if the amended complaint would not survive a motion to dismiss for failure to state a claim upon which relief could be granted.” Id. Here, further amendment would be futile because Plaintiffs claims could not survive a subsequent motion to dismiss or a renewed motion for judgment on the pleadings for lack of proximate cause. The Court will not grant Plaintiff leave to amend. VI.",
"CONCLUSION For these reasons, the Court will grant Defendant Honeywell’s Motion to Dismiss, grant Defendant ADT’s Motion for Judgment on the Pleadings, and dismiss Plaintiffs Amended Complaint with prejudice. An appropriate order follows. ORDER AND NOW, this 1st day of July, 2016, after a hearing with the parties on June 14, 2016, and for the reasons set forth in the memorandum accompanying this order, it is hereby ORDERED as follows: (1) Defendant Honeywell International, Inc,’s Motion to Dismiss Amended Complaint (ECF No. 30) is GRANTED; (2) Defendant ADT LLC’s Motion for Judgment on the Pleadings (ECF No. 38) is GRANTED; (3) Plaintiffs Amended Complaint (ECF No. 29) is DISMISSED with prejudice; (4)The Clerk of the Court shall mark the above-captioned case as CLOSED. AND IT IS SO ORDERED. . For the purposes of this motion, the Court will treat the liability of Honeywell, the manufacturer of part of the alarm system, and ADT, the installer and operator of the alarm system, as co-extensive.",
". The facts are construed in the light most favorable to Plaintiff as the nonmoving party. . Various terms are throughout the Amended Complaint to describe Plaintiff's residence in Benton, Pennsylvania, such as \"weekend home,” \"home,” “the house,” “residence,” and “the property.” See, e,g„ Am. Compl. ¶¶ 19, 23, 26(a), 32, 34, 37, 40, 53. For clarity, the location will be referred to as Plaintiff's “residence” or “weekend residence” throughout this decision. .Plaintiff goes to great lengths in the Amended Complaint to describe her negotiations with the representative during this meeting, as well as her later discussions with the ADT installer. See Am. Compl. ¶¶ 19-38.",
"However, these negotiations and discussions are immaterial to whether the alarm system’s failure to perform, which is admitted for the purposes of this motion, proximately caused Harris’s death—the ultimate issue in this case. . The following information is not disclosed in the Amended Complaint: the nature of the relationship between Harris and Chattin; the subject matter of Chattin and Harris’s conversation outside of Harris's apartment; the basis or means by which Chattin gained access to Harris’s apartment; and why the Heeters feared that Chattin would harm Harris. But these factual gaps are ultimately irrelevant to the disposition of the case. . The Amended Complaint does not explain why the Heeters called Harris at his apartment upon discovering that their residence had been “burglarized,” particularly when the Amended Complaint does not state that the Heeters immediately recognized that one or more guns were missing from their collection. . Plaintiff has since withdrawn her negligence claim against Defendant Honeywell. ECF No. 40. . In Pennsylvania, “[wjrongful death and survival actions are not substantive causes of action; rather, they provide a vehicle through which plaintiffs can recover for unlawful conduct that results in death.” Williams v. City of Scranton, No. 10-388, 2013 WL 1339027, at *13 n. 7 (M.D.Pa.",
"Apr. 1, 2013) (quoting Sullivan v, Warminster Twp., 765 F.Supp.2d 687, *756707 (E.D.Pa.2011)). Therefore, recovery by Harris’s estate is contingent on the success of the substantive tort claims. . There may be no question of fact where the parties stipulate to the facts, no reasonable jury could differ, or the facts in the complaint are taken as true and in the light most favorable to the plaintiff. These events occur at various stages in a case’s lifespan. But at each of these stages, the Court applies the same substantive law to determine whether the facts that a plaintiff has alleged (in the case of a Rule 12(b)(6) pre-answer motion or Rule 12(c) post-answer motion) or shown (in the case of a Rule 50(b) post-verdict motion or Rule 56 pre-trial motion) malee out a legally cognizable claim. See Caprio, 709 F.3d at 146-47 (explaining that a Rule 12(c) motion \"based on the theory that the plaintiff failed to state a claim ... is reviewed under the same standards that apply to a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6)”); Huggins v. Zaloga, No. 11-2061, 2013 WL 1330812, at *3 (M.D.Pa. Mar. 29, 2013) (citing Mele v. Fed.",
"Reserve Bank of N.Y., 359 F.3d 251, 257 (3d Cir.2004)) (explaining that Rule 12(c)'s focus on the pleadings is \"[t]he one significant difference” between the resolution of Rule 12(c) and Rule 56 motions); LBL Skysystems (USA), Inc. v. APG-Am., Inc., 319 F.Supp.2d 515, 525 (E.D.Pa.2004)(“The standards for a judgment as a matter of law under Rule 50(b) mirrors the standard for summary judgment under ... Rule 56(e).”). Accordingly, because the Court takes Plaintiff's factual allegations as true, in order to determine whether Plaintiff has alleged a plausible claim under Rules 12(b)(6) and 12(c) in this case, other cases decided under Rules 50 and 56 are helpful to discern the legal standard under Pennsylvania law and how courts have applied it. See, e.g„ Twombly, 550 U.S. at 553, 127 S.Ct. 1955 (looking to Theatre Enterprises, Inc. v. Paramount Film Distributing Corp., 346 U.S. 537, 540, 74 S.Ct. 257, 98 L.Ed. 273 (1954), an opinion rendered at the summary judgment stage, to determine the substantive legal standard to apply at the pleading stage); Boice ex rel. Rought v. Tyler Mem'l Hosp., No. 06-1709, 2007 WL 2903424, at 6 (M.D.Pa.",
"Sept. 28, 2007) (citing Brown v. Phila. Coll. of Osteopathic Med., 760 A.2d 863, 868 (Pa.Super.Ct.2000), an opinion rendered at the Rule 50 stage, to determine the applicable causation standard for a claim at the pleading stage). . See supra n.9. . See supra n.9."
] | https://www.courtlistener.com/api/rest/v3/opinions/7239005/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Opinión concurrente emitida por el Juez Asociado Señor Santana Becerra. En casos de filiación que se han resuelto desde que pasé a formar parte del Tribunal, algunos de ellos sin opinión, he venido apuntando o reservando mi criterio sobre cuáles *715deban ser los pronunciamientos filiales a partir., de la Cons-titución de 1952: A la luz de la prueba- en el récord está plenamente justificada la declaración filial que hoy confirma-mos, aun bajo la exigencia de los requisitos de prueba que tanto la Sala sentenciadora como el Tribunal han tomado en consideración. Pero en lo que a mi .modo, de, pensar res-pecta, llegaría al mismo resultado del caso;. decretando - la filiación aunque no hubiera prueba alguna sobre la posesión del estado de hija natural. Consecuénte en mi posición anterior, apunto también mi criterio en esta ocasión, suscinta-mente, ya que factores de tiempo y de disposición del tra-bajo no permiten por el momento una expresión elaborada de los conceptos que expongo: ‘ La demandante nació el 3.de octubre de 1928,.fruto de las relaciones de la madre con Félix Rafael Saürí. Así con-cluyó la Sala sentenciadora como cuestión de hecho, y como conclusión de derecho expuso: “Establecido el hecho dé lá paternidad de Félix Rafael, los -demás hechos que hemos encontrado probados se le juntan para dejar a su. vez esta-blecido el reconocimiento de la demandante fundado en la nosesión continua del estado de hija natural suya.” La sen-tencia declaró a la demandante “hija natural reconocida” de Félix Rafael Saurí. La demanda se interpuso en 18 de agosto de 1952 y esos pronunciamientos se hacían el HO de marzo de 1959, ambas cosas posteriores al 25 de julio .de 1952. (Énfasis señalado.) La Carta de Derechos del Estado Libre Asociado de Puerto Rico dispone que la dignidad del .ser humano es inviolable; todos los hombres son iguales ante, la ley y nó podrá establecerse discrimen alguno por motivo de raza, color, sexo, nacimiento, origen o condición social, ni ideas políticas o religiosas. (*) Explicada esta disposición constitucional en su contenido y alcance plenos, dice el Informe de la Comisión de la Carta de Derechos de la Convención; Constituyente: - *716“El propósito de esta sección es fijar claramente como base consustancial de todo lo que sigue el principio de la dignidad del ser humano y, como consecuencia de ésta, la igualdad esen-cial de todas las personas dentro de nuestro sistema constitucio-nal. La igualdad ante la ley queda por encima de accidentes o diferencias, bien tengan su origen en la naturaleza o en la cultura. Todo discrimen o privilegio contrario a esta esencial igualdad repugna al sistema jurídico puertorriqueño. En cuanto fuera menester nuestra organización legal queda robustecida por la presente disposición constitucional, a la vez que obligada a ensanchar sus disposiciones para dar plena realización a lo aquí dispuesto. (Énfasis adicionado.) Más particularmente en lo que respecta al discrimen por razón de nacimiento, dijo la Comisión en su Informe: “Se propone eliminar el estigma jurídico en contra de los hijos habidos fuera de matrimonio. Se coloca a todos los hijos respecto de sus padres y respecto del orden jurídico en igualdad de derechos. Las uniones ilícitas pueden y deben estar prohibi-das y esta disposición tendrá como una de sus consecuencias el desalentarlas. Pero el fruto inocente de ellas, debe advenir al mundo libre de descalificaciones o de inferioridades jurídicas. Así lo exige el principio de la responsabilidad individual, con arreglo a la cual nadie es culpable por los actos que él mismo no realiza. Aunque la legislación actual ya cubre en casi su totalidad lo aquí dispuesto, será menester nueva legislación. A los fines de herencias y propiedades las modificaciones resultan-tes de esta sección no deberán ser retroactivas a nacimientos ocurridos antes de su vigencia.” (Énfasis adicionado.) No podrá establecerse discrimen alguno por motivo de nacimiento, reza la Constitución, fijando [“como base con-sustancial de todo lo que sigue el principio de la dignidad del ser humano”] la igualdad esencial de todas las personas dentro del régimen constitucional. Para mí ello significa y quiere decir que después de dicho mandato los tribunales no harán pronunciamiento alguno catalogando, distinguiendo, adjetivando p cualificando la condición de hijo, una vez adju-dicado el hecho de la paternidad. Entiendo que ese mandato ha de cumplirse en toda acción filial que ya no hubiere que-*717dado resuelta al regir la Constitución, sin importar su comienzo o cuándo hubiere ocurrido el nacimiento, ni lo que dispusieran las leyes en vigor a la fecha de ocurrir éste. En el plano de la esencial igualdad de la persona que la declaración constitucional persigue, no concibo un estado de derecho que aplique dicha declaración constitucional en lo que al nacimiento respecta, a aquellos que nacieren después de su proclamación, implicando una reserva en cuanto a su vigencia o efectividad que no tiene en su texto ni contempla en su espíritu, y que permitiría continuar en el régimen de la desigualdad y de la indignidad del ser humano por falta de la esencial igualdad, a varias generaciones hasta que las mismas se extingan por el proceso natural de su desapari-ción. En este sentido significativo es lo expresado por la Comisión de la Carta de Derechos. “Se propone eliminar”, dice, el estigma jurídico en contra de los hijos habidos fuera de matrimonio. “Se coloca a todos los hijos”, continúa, res-pecto de sus padres y respecto del orden jurídico, en igual-dad de derechos. En el espíritu de reivindicación humana a través de la esencial igualdad de la persona en que se adoptó esa parte de nuestra Carta de Derechos, no concibo que pueda quedar en pie para la generación ya procreada un estado de derecho que, aun bajo la avanzada legislación sobre los hijos de 1942 a 1952 según ha sido interpretada, mantiene todavía lo que para mi es el contrasentido jurídico-social del padre que engendró y del hijo engendrado que lo es para un fin y que no lo será para otros, como si la naturaleza así se desdo-blara. No concibo tampoco dentro del espíritu señalado, el que se contemplara dejar a la generación procreada sujeta al eventual peligro de un retroceso en la legislación de avance vigente al momento de proclamarse la Constitución lo cual, bajo el estado de derecho que apunto, sería factible siempre que no se extendiera a los que nacieren después. *718Me he referido a la esencial igualdad del hijo en la persona, no en su patrimonio. La diferencia en patrimonio, la “herencia y propiedades”, no crea estigma. Dentro del régi-men matrimonial mismo unos hijos han recibido menor patri-monio que otros, sin que por ello no se les haya tenido en la esencial igualdad de sus personas. Y aun en lo que al patrimonio respecta, a partir de la Constitución todos los hijos no importa cuándo o la condición en que hayan nacido o se les haya declarado, hijos, han de advenir a la herencia en plena igualdad de derechos.(**) Tengo la convicción que por imperativo de la declaración constitucional según me es dable entenderla, el artículo 125 del Código Civil no tiene ya razón de ser. Pronunciada la condición en sí de ser hijo se adviene a la esencial igualdad de la persona por la superior declaración constitucional. Los actos que estatuye el artículo 125, —particularmente los que hubiere de realizar el propio padre o su familia, de donde surja una posesión de estado, — que llevarían al hijo al seno de la familia y a tener un padre ante la ley y la sociedad, o que se lo frustraría de no lograr probarlos, son para mi accidentes, como dijera la Comisión de la Carta de Derechos en su Informe, por encima de los cuales queda la igualdad ante la ley. El artículo 125 me parece ya un anacronismo que cuanto antes debería ir a ocupar el sitio que le corres-ponde en un derecho de familia que ha pasado a ser histórico. Por las razones que he expresado también confirmaría la sentencia, independientemente de que hubiera habido o no prueba sobre posesión del estado de hija natural; y habién-dose alegado y probado según el récord que al tiempo de la concepción los padres podían casarse, y que el padre falleció, la modificaría de paso declarando que Mercedes Berdecía es hija de Félix Rafael Saurí con derecho a heredarle o repre-sentarle según se disponía para los entonces hijos naturales reconocidos por la ley vigente al tiempo del fallecimiento.
Constitución, Artículo II sec. 1.
Véase Ley 17 de 20 de agosto de 1952. | 11-23-2022 | [
"Opinión concurrente emitida por el Juez Asociado Señor Santana Becerra. En casos de filiación que se han resuelto desde que pasé a formar parte del Tribunal, algunos de ellos sin opinión, he venido apuntando o reservando mi criterio sobre cuáles *715deban ser los pronunciamientos filiales a partir., de la Cons-titución de 1952: A la luz de la prueba- en el récord está plenamente justificada la declaración filial que hoy confirma-mos, aun bajo la exigencia de los requisitos de prueba que tanto la Sala sentenciadora como el Tribunal han tomado en consideración. Pero en lo que a mi .modo, de, pensar res-pecta, llegaría al mismo resultado del caso;. decretando - la filiación aunque no hubiera prueba alguna sobre la posesión del estado de hija natural. Consecuénte en mi posición anterior, apunto también mi criterio en esta ocasión, suscinta-mente, ya que factores de tiempo y de disposición del tra-bajo no permiten por el momento una expresión elaborada de los conceptos que expongo: ‘ La demandante nació el 3.de octubre de 1928,.fruto de las relaciones de la madre con Félix Rafael Saürí.",
"Así con-cluyó la Sala sentenciadora como cuestión de hecho, y como conclusión de derecho expuso: “Establecido el hecho dé lá paternidad de Félix Rafael, los -demás hechos que hemos encontrado probados se le juntan para dejar a su. vez esta-blecido el reconocimiento de la demandante fundado en la nosesión continua del estado de hija natural suya.” La sen-tencia declaró a la demandante “hija natural reconocida” de Félix Rafael Saurí. La demanda se interpuso en 18 de agosto de 1952 y esos pronunciamientos se hacían el HO de marzo de 1959, ambas cosas posteriores al 25 de julio .de 1952. (Énfasis señalado.) La Carta de Derechos del Estado Libre Asociado de Puerto Rico dispone que la dignidad del .ser humano es inviolable; todos los hombres son iguales ante, la ley y nó podrá establecerse discrimen alguno por motivo de raza, color, sexo, nacimiento, origen o condición social, ni ideas políticas o religiosas. (*) Explicada esta disposición constitucional en su contenido y alcance plenos, dice el Informe de la Comisión de la Carta de Derechos de la Convención; Constituyente: - *716“El propósito de esta sección es fijar claramente como base consustancial de todo lo que sigue el principio de la dignidad del ser humano y, como consecuencia de ésta, la igualdad esen-cial de todas las personas dentro de nuestro sistema constitucio-nal. La igualdad ante la ley queda por encima de accidentes o diferencias, bien tengan su origen en la naturaleza o en la cultura.",
"Todo discrimen o privilegio contrario a esta esencial igualdad repugna al sistema jurídico puertorriqueño. En cuanto fuera menester nuestra organización legal queda robustecida por la presente disposición constitucional, a la vez que obligada a ensanchar sus disposiciones para dar plena realización a lo aquí dispuesto. (Énfasis adicionado.) Más particularmente en lo que respecta al discrimen por razón de nacimiento, dijo la Comisión en su Informe: “Se propone eliminar el estigma jurídico en contra de los hijos habidos fuera de matrimonio. Se coloca a todos los hijos respecto de sus padres y respecto del orden jurídico en igualdad de derechos.",
"Las uniones ilícitas pueden y deben estar prohibi-das y esta disposición tendrá como una de sus consecuencias el desalentarlas. Pero el fruto inocente de ellas, debe advenir al mundo libre de descalificaciones o de inferioridades jurídicas. Así lo exige el principio de la responsabilidad individual, con arreglo a la cual nadie es culpable por los actos que él mismo no realiza. Aunque la legislación actual ya cubre en casi su totalidad lo aquí dispuesto, será menester nueva legislación. A los fines de herencias y propiedades las modificaciones resultan-tes de esta sección no deberán ser retroactivas a nacimientos ocurridos antes de su vigencia.” (Énfasis adicionado.) No podrá establecerse discrimen alguno por motivo de nacimiento, reza la Constitución, fijando [“como base con-sustancial de todo lo que sigue el principio de la dignidad del ser humano”] la igualdad esencial de todas las personas dentro del régimen constitucional.",
"Para mí ello significa y quiere decir que después de dicho mandato los tribunales no harán pronunciamiento alguno catalogando, distinguiendo, adjetivando p cualificando la condición de hijo, una vez adju-dicado el hecho de la paternidad. Entiendo que ese mandato ha de cumplirse en toda acción filial que ya no hubiere que-*717dado resuelta al regir la Constitución, sin importar su comienzo o cuándo hubiere ocurrido el nacimiento, ni lo que dispusieran las leyes en vigor a la fecha de ocurrir éste. En el plano de la esencial igualdad de la persona que la declaración constitucional persigue, no concibo un estado de derecho que aplique dicha declaración constitucional en lo que al nacimiento respecta, a aquellos que nacieren después de su proclamación, implicando una reserva en cuanto a su vigencia o efectividad que no tiene en su texto ni contempla en su espíritu, y que permitiría continuar en el régimen de la desigualdad y de la indignidad del ser humano por falta de la esencial igualdad, a varias generaciones hasta que las mismas se extingan por el proceso natural de su desapari-ción.",
"En este sentido significativo es lo expresado por la Comisión de la Carta de Derechos. “Se propone eliminar”, dice, el estigma jurídico en contra de los hijos habidos fuera de matrimonio. “Se coloca a todos los hijos”, continúa, res-pecto de sus padres y respecto del orden jurídico, en igual-dad de derechos. En el espíritu de reivindicación humana a través de la esencial igualdad de la persona en que se adoptó esa parte de nuestra Carta de Derechos, no concibo que pueda quedar en pie para la generación ya procreada un estado de derecho que, aun bajo la avanzada legislación sobre los hijos de 1942 a 1952 según ha sido interpretada, mantiene todavía lo que para mi es el contrasentido jurídico-social del padre que engendró y del hijo engendrado que lo es para un fin y que no lo será para otros, como si la naturaleza así se desdo-blara. No concibo tampoco dentro del espíritu señalado, el que se contemplara dejar a la generación procreada sujeta al eventual peligro de un retroceso en la legislación de avance vigente al momento de proclamarse la Constitución lo cual, bajo el estado de derecho que apunto, sería factible siempre que no se extendiera a los que nacieren después.",
"*718Me he referido a la esencial igualdad del hijo en la persona, no en su patrimonio. La diferencia en patrimonio, la “herencia y propiedades”, no crea estigma. Dentro del régi-men matrimonial mismo unos hijos han recibido menor patri-monio que otros, sin que por ello no se les haya tenido en la esencial igualdad de sus personas. Y aun en lo que al patrimonio respecta, a partir de la Constitución todos los hijos no importa cuándo o la condición en que hayan nacido o se les haya declarado, hijos, han de advenir a la herencia en plena igualdad de derechos. (**) Tengo la convicción que por imperativo de la declaración constitucional según me es dable entenderla, el artículo 125 del Código Civil no tiene ya razón de ser. Pronunciada la condición en sí de ser hijo se adviene a la esencial igualdad de la persona por la superior declaración constitucional.",
"Los actos que estatuye el artículo 125, —particularmente los que hubiere de realizar el propio padre o su familia, de donde surja una posesión de estado, — que llevarían al hijo al seno de la familia y a tener un padre ante la ley y la sociedad, o que se lo frustraría de no lograr probarlos, son para mi accidentes, como dijera la Comisión de la Carta de Derechos en su Informe, por encima de los cuales queda la igualdad ante la ley. El artículo 125 me parece ya un anacronismo que cuanto antes debería ir a ocupar el sitio que le corres-ponde en un derecho de familia que ha pasado a ser histórico. Por las razones que he expresado también confirmaría la sentencia, independientemente de que hubiera habido o no prueba sobre posesión del estado de hija natural; y habién-dose alegado y probado según el récord que al tiempo de la concepción los padres podían casarse, y que el padre falleció, la modificaría de paso declarando que Mercedes Berdecía es hija de Félix Rafael Saurí con derecho a heredarle o repre-sentarle según se disponía para los entonces hijos naturales reconocidos por la ley vigente al tiempo del fallecimiento. Constitución, Artículo II sec. 1. Véase Ley 17 de 20 de agosto de 1952."
] | https://www.courtlistener.com/api/rest/v3/opinions/8558289/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Exhibit 3.1.6 State of Delaware Secretary of State Division of Corporations Delivered 09:37 AM 02/19/2010 FILED, 09:36 AM 02/19/2010 SRV 100166768 - 4424969 FILE CERTIFICATE OF CORRECTION OF CERTIFICATE OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION OF ENVIRONMENTAL DIGITAL SERVICES, INC. ENVIRONMENTAL DIGITAL SERVICES, INC., a corporation organized and existing under the General Corporation Law of the State of Delaware (the "Corporation"), hereby certifies pursuant to Section 103(f) of the General Corporation Law of the State of Delaware that: 1. The Company filed on February 13, 2009 a Certificate of Amendment to the Certificate of Incorporation (file number 4424969) (the "Certificate of Amendment"). 2. The Certificate of Amendment was an inaccurate record of the corporate action therein referred to in the following respects: a. The first paragraph of Article VI was an inaccurate representation of the Company's intended share structure. 3. As corrected, the Certificate of Amendment filed on February 13, 2009 reads in full; CERTIFICATE OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION OF ENVIRONMENTAL DIGITAL SERVICES. INC. ENVIRONMENTAL DIGITAL SERVICES, INC,. a corporation organized and existing under the General Corporation Law of the State of Delaware (the "Corporation"), hereby certifies that the amendment set fordl below to the Corporation's Certificate of Incorporation was duly adopted in accordance with the provisions of Sections 242 of the General Corporation Law of the State of Delaware. ARTICLE 1 NAME FIRST: ARTICLE 1 is hereby amended as follows: The name of the Corporation shall be 'Sabre Industrial, Inc." Second: Article VI is hereby amended to add the following to the first paragraph, the remainder of Article VI shall remain unchanged: ARTICLE VI CAPITAL STOCK Each seventy five (75) shares of Conunon Stock outstanding at 9:00 a.m. on March 26, 2010 shall be deemed to be one (1) share of Common Stock of the Corporation, par value $.001 per share. There shall be no fractional shares. Odd lots shall be rounded up to 100 shares. Third: That pursuant to Section 228 of the General Corporation Law of the State of Delaware, a consent setting forth resolutions approving the amendments set forth above was signed by holders of outstanding stock having not less than the minimum number of votes necessary to authorize or take action at a meeting at which all shares entitled to vote thereon were present and voted. Fourth: That said amendments were duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware. IN WITNESS WHEREOF, the Corporation has caused this Certificate of Correction of Certificate of Amendment to be signed by its duly authorized officer as of this 18th day of February. 2010. ENVIRONMENTAL DIGITAL SERVICES, INC. By:/s/ Michael Anthony Michael Anthony, President | [
"Exhibit 3.1.6 State of Delaware Secretary of State Division of Corporations Delivered 09:37 AM 02/19/2010 FILED, 09:36 AM 02/19/2010 SRV 100166768 - 4424969 FILE CERTIFICATE OF CORRECTION OF CERTIFICATE OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION OF ENVIRONMENTAL DIGITAL SERVICES, INC. ENVIRONMENTAL DIGITAL SERVICES, INC., a corporation organized and existing under the General Corporation Law of the State of Delaware (the \"Corporation\"), hereby certifies pursuant to Section 103(f) of the General Corporation Law of the State of Delaware that: 1. The Company filed on February 13, 2009 a Certificate of Amendment to the Certificate of Incorporation (file number 4424969) (the \"Certificate of Amendment\"). 2. The Certificate of Amendment was an inaccurate record of the corporate action therein referred to in the following respects: a. The first paragraph of Article VI was an inaccurate representation of the Company's intended share structure. 3.",
"As corrected, the Certificate of Amendment filed on February 13, 2009 reads in full; CERTIFICATE OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION OF ENVIRONMENTAL DIGITAL SERVICES. INC. ENVIRONMENTAL DIGITAL SERVICES, INC,. a corporation organized and existing under the General Corporation Law of the State of Delaware (the \"Corporation\"), hereby certifies that the amendment set fordl below to the Corporation's Certificate of Incorporation was duly adopted in accordance with the provisions of Sections 242 of the General Corporation Law of the State of Delaware. ARTICLE 1 NAME FIRST: ARTICLE 1 is hereby amended as follows: The name of the Corporation shall be 'Sabre Industrial, Inc.\" Second: Article VI is hereby amended to add the following to the first paragraph, the remainder of Article VI shall remain unchanged: ARTICLE VI CAPITAL STOCK Each seventy five (75) shares of Conunon Stock outstanding at 9:00 a.m. on March 26, 2010 shall be deemed to be one (1) share of Common Stock of the Corporation, par value $.001 per share. There shall be no fractional shares. Odd lots shall be rounded up to 100 shares. Third: That pursuant to Section 228 of the General Corporation Law of the State of Delaware, a consent setting forth resolutions approving the amendments set forth above was signed by holders of outstanding stock having not less than the minimum number of votes necessary to authorize or take action at a meeting at which all shares entitled to vote thereon were present and voted.",
"Fourth: That said amendments were duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware. IN WITNESS WHEREOF, the Corporation has caused this Certificate of Correction of Certificate of Amendment to be signed by its duly authorized officer as of this 18th day of February. 2010. ENVIRONMENTAL DIGITAL SERVICES, INC. By:/s/ Michael Anthony Michael Anthony, President"
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
|
The suit, being for the recovery of real property, should have been brought in Merrimack county where the property is situated. 1 Chit. Pl. 268; Worster v. Lake Company, 25 N.H. 525, 530, Bay State Iron Company v. Goodall, 39 N.H. 223, 232, Bancroft v. Conant, 64 N.H. 151. The error was curable by an order transferring the suit to that county. P. S., c. 222, ss. 7, 8; Bartlett v. Lee, 60 N.H. 168; Wheeler Wilson Mfg. Company v. Whitcomb, 62 N.H. 411. Whether justice required the order to be made, was a question of fact that was decided affirmatively at the trial term, and the decision is not reviewable here. Hazen v. Quimby, 61 N.H. 76; Garvin v. Legery, 61 N.H. 153; Gagnon v. Connor, 64 N.H. 276; Holman v. Manning,65 N.H. 92. Exception overruled. CARPENTER, J., did not sit: the others concurred. | 07-05-2016 | [
"The suit, being for the recovery of real property, should have been brought in Merrimack county where the property is situated. 1 Chit. Pl. 268; Worster v. Lake Company, 25 N.H. 525, 530, Bay State Iron Company v. Goodall, 39 N.H. 223, 232, Bancroft v. Conant, 64 N.H. 151. The error was curable by an order transferring the suit to that county. P. S., c. 222, ss. 7, 8; Bartlett v. Lee, 60 N.H. 168; Wheeler Wilson Mfg. Company v. Whitcomb, 62 N.H. 411. Whether justice required the order to be made, was a question of fact that was decided affirmatively at the trial term, and the decision is not reviewable here. Hazen v. Quimby, 61 N.H. 76; Garvin v. Legery, 61 N.H. 153; Gagnon v. Connor, 64 N.H. 276; Holman v. Manning,65 N.H. 92. Exception overruled. CARPENTER, J., did not sit: the others concurred."
] | https://www.courtlistener.com/api/rest/v3/opinions/3553392/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
This memorandum opinion was not selected for publication in the New Mexico Reports. Please see Rule 12-405 NMRA for restrictions on the citation of unpublished memorandum opinions. Please also note that this electronic memorandum opinion may contain computer-generated errors or other deviations from the official paper version filed by the Court of Appeals and does not include the filing date.
1 IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
2 ROBERTA OLIVAS, f/k/a 3 ROBERTA PEKARCIK,
4 Petitioner-Appellee
5 v. NO. 31,851
6 PHILIP PEKARCIK,
7 Respondent-Appellant.
8 APPEAL FROM THE DISTRICT COURT OF SANTA FE COUNTY 9 T. Glenn Ellington, District Judge
10 Roberta Olivas 11 Santa Fe, NM
12 Pro Se Appellee
13 Philip Pekarcik 14 Los Lunas, NM
15 Pro Se Appellant
16 MEMORANDUM OPINION
17 VIGIL, Judge. 1 Respondent, pro se, seeks to appeal from the district court’s order denying his
2 motion to change venue and awarding Petitioner attorney fees. We issued a notice of
3 proposed summary disposition, proposing to dismiss for lack of a final, appealable
4 order. Respondent has filed a response to our notice, which we have duly considered.
5 We remain unpersuaded that the order from which Respondent seeks to appeal is final
6 and appealable at this time. We dismiss.
7 In his docketing statement, Respondent asked this Court for an immediate stay
8 of the upcoming hearing, and asks us to reverse the order for attorney fees, to
9 “[r]emand jurisdiction to the Santa Clara Pueblo,” and to order Petitioner to pay him
10 the two fees she owes him. [DS 22] Respondent contended that jurisdiction was
11 proper in the tribal court of Santa Clara Pueblo, not the district court and that attorney
12 fees were wrongfully awarded for Petitioner to respond to the motion to change venue.
13 [DS 18]
14 Our notice explained why we believe that Respondent seeks to appeal from a
15 non-final order. We also observed that the district court’s order does not include the
16 certification language required under Rule 1-054(B)(1) NMRA to render the order
17 final and immediately appealable. [RP 374] See Rule 1-054(B)(1) (requiring the
18 district court to finalize one but fewer than all of the claims upon a certification that
19 “there is no just reason for delay”). In the absence of a final order and district court
2 1 certification, we explained that it appeared there was no sound basis upon which to
2 extend our jurisdiction to resolve Respondent’s issues now.
3 We specially observed that, under certain circumstances, an order for attorney
4 fees can be treated as a collateral, outstanding matter that may be separately appealed.
5 See, e.g., Trujillo v. Hilton of Santa Fe, 115 N.M. 398, 402, 851 P.2d 1065, 1069 (Ct.
6 Ohio App. 1993) (noting that “the critical issue is whether the subsequent proceedings
7 [regarding attorney fees] will alter the judgment or moot or revise the decision
8 embodied therein”). We explained that the order for attorney fees, however, must be
9 collateral to a final judgment to be separately appealable and then the appealing party
10 has the choice to appeal from the final judgment immediately or wait to appeal from
11 the order resolving the collateral, pending matter of attorney fees. See, e.g., Executive
12 Sports Club, Inc. v. First Plaza Trust, 1998-NMSC-008, ¶¶ 6-14, 125 N.M. 78, 957
13 P.2d 63. Such principles of finality are born of practicality and “are intended to assist
14 the courts in promoting judicial efficiency and preventing piecemeal appeals,” not to
15 create an otherwise unappealable order from the collateral matter of attorney fees. Id.
16 ¶ 11. Because there is no final order underlying the award of attorney fees, we
17 proposed to conclude that this is not a situation in which the award of attorney fees
18 is separately appealable.
3 1 In response to our notice, Respondent pursues only his challenge to the district
2 court’s award of attorney fees. [MIO 1-2] Thus, he has abandoned all other issues.
3 See State v. Johnson, 107 N.M. 356, 358, 758 P.2d 306, 308 (Ct. App. 1988) (stating
4 that when a case is decided on the summary calendar, an issue is deemed abandoned
5 where a party fails to respond to the proposed disposition of the issue). Also,
6 Respondent does not address our finality analysis. Rather, he simply asserts without
7 argument or citation to any authority, that the district court’s order regarding attorney
8 fees is a final decision. We disagree for the reasons stated in our notice.
9 Based on the foregoing, we dismiss Respondent’s appeal for lack of a final,
10 appealable order.
11 IT IS SO ORDERED.
12 _______________________________ 13 MICHAEL E. VIGIL, Judge
14 WE CONCUR:
15 _________________________________ 16 JAMES J. WECHSLER, Judge
17 _________________________________
4 1 TIMOTHY L. GARCIA, Judge
5 | 06-05-2013 | [
"This memorandum opinion was not selected for publication in the New Mexico Reports. Please see Rule 12-405 NMRA for restrictions on the citation of unpublished memorandum opinions. Please also note that this electronic memorandum opinion may contain computer-generated errors or other deviations from the official paper version filed by the Court of Appeals and does not include the filing date. 1 IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO 2 ROBERTA OLIVAS, f/k/a 3 ROBERTA PEKARCIK, 4 Petitioner-Appellee 5 v. NO. 31,851 6 PHILIP PEKARCIK, 7 Respondent-Appellant. 8 APPEAL FROM THE DISTRICT COURT OF SANTA FE COUNTY 9 T. Glenn Ellington, District Judge 10 Roberta Olivas 11 Santa Fe, NM 12 Pro Se Appellee 13 Philip Pekarcik 14 Los Lunas, NM 15 Pro Se Appellant 16 MEMORANDUM OPINION 17 VIGIL, Judge. 1 Respondent, pro se, seeks to appeal from the district court’s order denying his 2 motion to change venue and awarding Petitioner attorney fees. We issued a notice of 3 proposed summary disposition, proposing to dismiss for lack of a final, appealable 4 order. Respondent has filed a response to our notice, which we have duly considered.",
"5 We remain unpersuaded that the order from which Respondent seeks to appeal is final 6 and appealable at this time. We dismiss. 7 In his docketing statement, Respondent asked this Court for an immediate stay 8 of the upcoming hearing, and asks us to reverse the order for attorney fees, to 9 “[r]emand jurisdiction to the Santa Clara Pueblo,” and to order Petitioner to pay him 10 the two fees she owes him. [DS 22] Respondent contended that jurisdiction was 11 proper in the tribal court of Santa Clara Pueblo, not the district court and that attorney 12 fees were wrongfully awarded for Petitioner to respond to the motion to change venue. 13 [DS 18] 14 Our notice explained why we believe that Respondent seeks to appeal from a 15 non-final order. We also observed that the district court’s order does not include the 16 certification language required under Rule 1-054(B)(1) NMRA to render the order 17 final and immediately appealable. [RP 374] See Rule 1-054(B)(1) (requiring the 18 district court to finalize one but fewer than all of the claims upon a certification that 19 “there is no just reason for delay”).",
"In the absence of a final order and district court 2 1 certification, we explained that it appeared there was no sound basis upon which to 2 extend our jurisdiction to resolve Respondent’s issues now. 3 We specially observed that, under certain circumstances, an order for attorney 4 fees can be treated as a collateral, outstanding matter that may be separately appealed. 5 See, e.g., Trujillo v. Hilton of Santa Fe, 115 N.M. 398, 402, 851 P.2d 1065, 1069 (Ct. 6 Ohio App. 1993) (noting that “the critical issue is whether the subsequent proceedings 7 [regarding attorney fees] will alter the judgment or moot or revise the decision 8 embodied therein”). We explained that the order for attorney fees, however, must be 9 collateral to a final judgment to be separately appealable and then the appealing party 10 has the choice to appeal from the final judgment immediately or wait to appeal from 11 the order resolving the collateral, pending matter of attorney fees.",
"See, e.g., Executive 12 Sports Club, Inc. v. First Plaza Trust, 1998-NMSC-008, ¶¶ 6-14, 125 N.M. 78, 957 13 P.2d 63. Such principles of finality are born of practicality and “are intended to assist 14 the courts in promoting judicial efficiency and preventing piecemeal appeals,” not to 15 create an otherwise unappealable order from the collateral matter of attorney fees. Id. 16 ¶ 11. Because there is no final order underlying the award of attorney fees, we 17 proposed to conclude that this is not a situation in which the award of attorney fees 18 is separately appealable. 3 1 In response to our notice, Respondent pursues only his challenge to the district 2 court’s award of attorney fees. [MIO 1-2] Thus, he has abandoned all other issues.",
"3 See State v. Johnson, 107 N.M. 356, 358, 758 P.2d 306, 308 (Ct. App. 1988) (stating 4 that when a case is decided on the summary calendar, an issue is deemed abandoned 5 where a party fails to respond to the proposed disposition of the issue). Also, 6 Respondent does not address our finality analysis. Rather, he simply asserts without 7 argument or citation to any authority, that the district court’s order regarding attorney 8 fees is a final decision. We disagree for the reasons stated in our notice. 9 Based on the foregoing, we dismiss Respondent’s appeal for lack of a final, 10 appealable order. 11 IT IS SO ORDERED. 12 _______________________________ 13 MICHAEL E. VIGIL, Judge 14 WE CONCUR: 15 _________________________________ 16 JAMES J. WECHSLER, Judge 17 _________________________________ 4 1 TIMOTHY L. GARCIA, Judge 5"
] | https://www.courtlistener.com/api/rest/v3/opinions/894092/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
74 So.3d 1082 (2011) CASEY v. STATE. No. SC11-1642. Supreme Court of Florida. October 11, 2011.
DECISION WITHOUT PUBLISHED OPINION Prohibition dismissed. | 10-30-2013 | [
"74 So.3d 1082 (2011) CASEY v. STATE. No. SC11-1642. Supreme Court of Florida. October 11, 2011. DECISION WITHOUT PUBLISHED OPINION Prohibition dismissed."
] | https://www.courtlistener.com/api/rest/v3/opinions/2491040/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case 1:19-cr-10080-NMG Document 972-7 Filed 03/25/20 Page 1 of 8
EXHIBIT G Case 1:19-cr-10080-NMG Document 972-7 Filed 03/25/20 Page 2 of 8
From: "Rosen, Eric (USAMA)" <Eric.Rosen@usdoj.gov> Sent: Jan 28, 2020 6:02 PM To: "McManus, Dylan (USAMA) [Contractor] 3" <Dylan.McManus2@usdoj.gov>; "Allen J. Ruby" <allen.ruby@skadden.com>; "Andrew E. Tomback" <andrew.tomback@whitecase.com>; "Brian T. Kelly" <bkelly@nixonpeabody.com>; "David E. Meier" <dmeier@toddweld.com>; "David S. Schumacher" <DSchumacher@health-law.com>; "David Z. Chesnoff" <dzchesnoff@cslawoffice.net>; "Eoin P. Beirne" <ebeirne@mintz.com>; George Vien <gwv@dcglaw.com>; "Jack P. DiCanio" <jack.dicanio@skadden.com>; "Jack W. Pirozzolo" <jpirozzolo@sidley.com>; "John C. Hueston" <jhueston@hueston.com>; "Jordan R.C. Kearney" <JKearney@health-law.com>; Josh Ruby <jnr@dcglaw.com>; "Joshua C.H. Sharp" <jsharp@nixonpeabody.com>; "Mark E. Robinson" <merobinson@mintz.com>; "Martin G. Weinberg" <owlmcb@att.net>; "Matthew L. Schwartz" <mlschwartz@bsfllp.com>; "Megan A. Siddall" <msiddall@mosllp.com>; "Michael K. Loucks" <michael.loucks@skadden.com>; Michael Kendall <michael.kendall@whitecase.com>; "Nicholas C. Theodorou" <ntheodorou@foleyhoag.com>; Patric Hooper <phooper@health-law.com>; "Viscounty, Perry (OC-SF)" <PERRY.VISCOUNTY@LW.com>; "R. Robert Popeo" <rrpopeo@mintz.com>; Reuben Camper Cahn <rcahn@kelleranderle.com>; "Richard A. Schonfeld" <rschonfeld@cslawoffice.net>; "Berkowitz, Sean (CH)" <Sean.Berkowitz@lw.com>; "Seth B. Orkand" <sorkand@mosllp.com>; "Stephen H. Sutro" <SHSutro@duanemorris.com>; "Tracy A. Miner" <tminer@mosllp.com>; "Trach, William (BN)" <William.Trach@lw.com>; Yakov Malkiel <yakov.malkiel@whitecase.com>; "Blanco, Allison (OC)" <Allison.Blanco@lw.com> Cc: "O'Connell, Justin (USAMA)" <Justin.O'Connell@usdoj.gov>; "Wright, Leslie (USAMA)" <Leslie.Wright@usdoj.gov>; "Kearney, Kristen (USAMA)" <Kristen.Kearney@usdoj.gov> Subject: RE: 19-CR-10080-NMG Discovery Production
Please see attached. Eric
Eric S. Rosen Assistant United States Attorney District of Massachusetts Tel: +1 617 748 3412 E-Mail: eric.rosen@usdoj.gov Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 3 2 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 4 3 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 5 4 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 6 5 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 7 6 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 8 7 of 8 7
Sincerely,
ANDREW E. LELLING United States Attorney
By: /s Justin D. O’Connell Eric S. Rosen Justin D. O’Connell Kirsten A. Kearney Leslie A. Wright Assistant U.S. Attorneys
6 | 2020-03-25 | [
"Case 1:19-cr-10080-NMG Document 972-7 Filed 03/25/20 Page 1 of 8 EXHIBIT G Case 1:19-cr-10080-NMG Document 972-7 Filed 03/25/20 Page 2 of 8 From: \"Rosen, Eric (USAMA)\" <Eric.Rosen@usdoj.gov> Sent: Jan 28, 2020 6:02 PM To: \"McManus, Dylan (USAMA) [Contractor] 3\" <Dylan.McManus2@usdoj.gov>; \"Allen J. Ruby\" <allen.ruby@skadden.com>; \"Andrew E. Tomback\" <andrew.tomback@whitecase.com>; \"Brian T. Kelly\" <bkelly@nixonpeabody.com>; \"David E. Meier\" <dmeier@toddweld.com>; \"David S. Schumacher\" <DSchumacher@health-law.com>; \"David Z. Chesnoff\" <dzchesnoff@cslawoffice.net>; \"Eoin P. Beirne\" <ebeirne@mintz.com>; George Vien <gwv@dcglaw.com>; \"Jack P. DiCanio\" <jack.dicanio@skadden.com>; \"Jack W. Pirozzolo\" <jpirozzolo@sidley.com>; \"John C. Hueston\" <jhueston@hueston.com>; \"Jordan R.C. Kearney\" <JKearney@health-law.com>; Josh Ruby <jnr@dcglaw.com>; \"Joshua C.H. Sharp\" <jsharp@nixonpeabody.com>; \"Mark E. Robinson\" <merobinson@mintz.com>; \"Martin G. Weinberg\" <owlmcb@att.net>; \"Matthew L. Schwartz\" <mlschwartz@bsfllp.com>; \"Megan A. Siddall\" <msiddall@mosllp.com>; \"Michael K. Loucks\" <michael.loucks@skadden.com>; Michael Kendall <michael.kendall@whitecase.com>; \"Nicholas C. Theodorou\" <ntheodorou@foleyhoag.com>; Patric Hooper <phooper@health-law.com>; \"Viscounty, Perry (OC-SF)\" <PERRY.VISCOUNTY@LW.com>; \"R. Robert Popeo\" <rrpopeo@mintz.com>; Reuben Camper Cahn <rcahn@kelleranderle.com>; \"Richard A. Schonfeld\" <rschonfeld@cslawoffice.net>; \"Berkowitz, Sean (CH)\" <Sean.Berkowitz@lw.com>; \"Seth B. Orkand\" <sorkand@mosllp.com>; \"Stephen H. Sutro\" <SHSutro@duanemorris.com>; \"Tracy A. Miner\" <tminer@mosllp.com>; \"Trach, William (BN)\" <William.Trach@lw.com>; Yakov Malkiel <yakov.malkiel@whitecase.com>; \"Blanco, Allison (OC)\" <Allison.Blanco@lw.com> Cc: \"O'Connell, Justin (USAMA)\" <Justin.O'Connell@usdoj.gov>; \"Wright, Leslie (USAMA)\" <Leslie.Wright@usdoj.gov>; \"Kearney, Kristen (USAMA)\" <Kristen.Kearney@usdoj.gov> Subject: RE: 19-CR-10080-NMG Discovery Production Please see attached. Eric Eric S. Rosen Assistant United States Attorney District of Massachusetts Tel: +1 617 748 3412 E-Mail: eric.rosen@usdoj.gov Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 3 2 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 4 3 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 5 4 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 6 5 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 7 6 of 8 7 Case 1:19-cr-10080-NMG Document 972-7 807-1 Filed 03/25/20 01/31/20 Page 8 7 of 8 7 Sincerely, ANDREW E. LELLING United States Attorney By: /s Justin D. O’Connell Eric S. Rosen Justin D. O’Connell Kirsten A. Kearney Leslie A. Wright Assistant U.S.",
"Attorneys 6"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/139952854/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Sup. Ct. Wash. Certiorari denied. | 11-27-2022 | [
"Sup. Ct. Wash. Certiorari denied."
] | https://www.courtlistener.com/api/rest/v3/opinions/9010821/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
COURT OF APPEALS SECOND DISTRICT OF TEXAS FORT WORTH
NO. 2-09-451-CV
IN RE PREMIER TRAILER LEASING, INC. RELATOR
------------
ORIGINAL PROCEEDING
------------
MEMORANDUM OPINION 1
------------
The court has considered relator’s petition for writ of mandamus and is
of the opinion that relief should be denied. Accordingly, relator’s petition for
writ of mandamus is denied.
Relator shall pay all costs of this original proceeding, for which let
execution issue.
BILL MEIER JUSTICE
PANEL: MEIER, WALKER, and MCCOY, JJ.
MCCOY, J. would grant.
DELIVERED: February 10, 2010
1 … See Tex. R. App. P. 47.4. | 10-16-2015 | [
"COURT OF APPEALS SECOND DISTRICT OF TEXAS FORT WORTH NO. 2-09-451-CV IN RE PREMIER TRAILER LEASING, INC. RELATOR ------------ ORIGINAL PROCEEDING ------------ MEMORANDUM OPINION 1 ------------ The court has considered relator’s petition for writ of mandamus and is of the opinion that relief should be denied. Accordingly, relator’s petition for writ of mandamus is denied. Relator shall pay all costs of this original proceeding, for which let execution issue. BILL MEIER JUSTICE PANEL: MEIER, WALKER, and MCCOY, JJ. MCCOY, J. would grant.",
"DELIVERED: February 10, 2010 1 … See Tex. R. App. P. 47.4."
] | https://www.courtlistener.com/api/rest/v3/opinions/3130735/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Citation Nr: 0617606
Decision Date: 06/16/06 Archive Date: 06/27/06
DOCKET NO. 04-11 769 ) DATE
)
On appeal from the
Department of Veterans Affairs Regional Office in Montgomery,
Alabama
THE ISSUES
1. Entitlement to service connection for carcinoma of the
lung, status post left thoracotomy, as due to exposure to
asbestos.
2. Entitlement to service connection for post-traumatic
stress disorder (PTSD).
3. Entitlement to service connection renal adenocarcinoma,
status post right radical nephrectomy, claimed as due to
exposure to herbicides (Agent Orange).
4. Entitlement to service connection for a skin disorder,
claimed as skin cancer.
REPRESENTATION
Appellant represented by: The American Legion
ATTORNEY FOR THE BOARD
K. Ehrman, Counsel
INTRODUCTION
The veteran had active duty from January 1955 to December
1959.
This matter comes before the Board of Veterans' Appeals
(Board) on appeal of an April 2003 decision of the Department
of Veterans Affairs (VA) Regional Office (RO) in Montgomery,
Alabama.
FINDINGS OF FACT
1. The veteran in this case served on active duty from
January 1955 to December 1959.
2. On June 1, 2006 the Board was notified by the VA RO that
the veteran had died in January 2005.
CONCLUSION OF LAW
Because of the death of the veteran, the Board has no
jurisdiction to adjudicate the merits of the claims of
service connection for: carcinoma of the lung, status post
left thoracotomy, as due to exposure to asbestos; PTSD; renal
adenocarcinoma, status post right radical nephrectomy,
claimed as due to exposure to Agent Orange; and a skin
disorder, claimed as skin cancer. 38 U.S.C.A. § 7104(a)
(West 2002); 38 C.F.R. § 20.1302 (2005).
REASONS AND BASES FOR FINDINGS AND CONCLUSION
Unfortunately, the veteran died during the pendency of the
appeal. As a matter of law, veterans' claims do not survive
their deaths. Zevalkink v. Brown, 102 F.3d 1236, 1243-44
(Fed. Cir. 1996); Smith v. Brown, 10 Vet. App. 330, 333-34
(1997); Landicho v. Brown, 7 Vet. App. 42, 47 (1994). This
appeal on the merits has become moot by virtue of the death
of the veteran and must be dismissed for lack of
jurisdiction. See 38 U.S.C.A. § 7104(a) (West 2002); 38
C.F.R. § 20.1302 (2005).
In reaching this determination, the Board intimates no
opinion as to the merits of the claims on appeal, or to any
derivative claim brought by a survivor of the veteran.
38 C.F.R. § 20.1106 (2005).
ORDER
The claims of service connection for carcinoma of the lung,
status post left thoracotomy, as due to exposure to asbestos;
PTSD; renal adenocarcinoma, status post right radical
nephrectomy, claimed as due to exposure to Agent Orange; and
a skin disorder, claimed as skin cancer, are dismissed.
M. E. LARKIN
Acting Veterans Law Judge, Board of Veterans' Appeals
Department of Veterans Affairs | 06-16-2006 | [
"Citation Nr: 0617606 Decision Date: 06/16/06 Archive Date: 06/27/06 DOCKET NO. 04-11 769 ) DATE ) On appeal from the Department of Veterans Affairs Regional Office in Montgomery, Alabama THE ISSUES 1. Entitlement to service connection for carcinoma of the lung, status post left thoracotomy, as due to exposure to asbestos. 2. Entitlement to service connection for post-traumatic stress disorder (PTSD). 3. Entitlement to service connection renal adenocarcinoma, status post right radical nephrectomy, claimed as due to exposure to herbicides (Agent Orange). 4. Entitlement to service connection for a skin disorder, claimed as skin cancer. REPRESENTATION Appellant represented by: The American Legion ATTORNEY FOR THE BOARD K. Ehrman, Counsel INTRODUCTION The veteran had active duty from January 1955 to December 1959. This matter comes before the Board of Veterans' Appeals (Board) on appeal of an April 2003 decision of the Department of Veterans Affairs (VA) Regional Office (RO) in Montgomery, Alabama. FINDINGS OF FACT 1. The veteran in this case served on active duty from January 1955 to December 1959.",
"2. On June 1, 2006 the Board was notified by the VA RO that the veteran had died in January 2005. CONCLUSION OF LAW Because of the death of the veteran, the Board has no jurisdiction to adjudicate the merits of the claims of service connection for: carcinoma of the lung, status post left thoracotomy, as due to exposure to asbestos; PTSD; renal adenocarcinoma, status post right radical nephrectomy, claimed as due to exposure to Agent Orange; and a skin disorder, claimed as skin cancer. 38 U.S.C.A. § 7104(a) (West 2002); 38 C.F.R. § 20.1302 (2005). REASONS AND BASES FOR FINDINGS AND CONCLUSION Unfortunately, the veteran died during the pendency of the appeal. As a matter of law, veterans' claims do not survive their deaths.",
"Zevalkink v. Brown, 102 F.3d 1236, 1243-44 (Fed. Cir. 1996); Smith v. Brown, 10 Vet. App. 330, 333-34 (1997); Landicho v. Brown, 7 Vet. App. 42, 47 (1994). This appeal on the merits has become moot by virtue of the death of the veteran and must be dismissed for lack of jurisdiction. See 38 U.S.C.A. § 7104(a) (West 2002); 38 C.F.R. § 20.1302 (2005). In reaching this determination, the Board intimates no opinion as to the merits of the claims on appeal, or to any derivative claim brought by a survivor of the veteran. 38 C.F.R. § 20.1106 (2005). ORDER The claims of service connection for carcinoma of the lung, status post left thoracotomy, as due to exposure to asbestos; PTSD; renal adenocarcinoma, status post right radical nephrectomy, claimed as due to exposure to Agent Orange; and a skin disorder, claimed as skin cancer, are dismissed. M. E. LARKIN Acting Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs"
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
LEAR, Judge. This appeal arises from a matter wherein the purported sale of certain lands and mineral interests situated in Rapides Parish are alleged to be null and void. Plaintiff pleaded fraud, error, failure of consideration, lesion beyond moity, depletion of patrimony, and “ * * * that the plaintiff is passed seventy-nine (79) years of age and is in poor health, and is not now, nor was he as of the date of March 13 and 14, 1963, as sharp in mind and memory as he has been in the past; that the defendant is a nephew of the plaintiff and that he well knew of the plaintiff’s physical and mental condition at the time of the above-mentioned transactions.” *183After answer and reconventional demand had been filed, defendant ruled petitioner into court to show cause why the suit should not be dismissed, basing his assertion on an alleged settlement entered into between the parties. Prior to the trial of this rule, one Cordia O’Neal petitioned the court for the interdiction of the plaintiff, in a proceeding separate from the instant case, and was appointed provisional curator of Louis (Louie) Reeves. Appearing herein as provisional curator, she moved for and obtained an order of court substituting her as party-plaintiff to act in the place and stead of the original petitioner. In her representative capacity, Cordia O’Neal then answered the rule to dismiss and set forth the incompetency of original petitioner, alleging that such incompetency was notorious and was generally known by persons who saw and conversed with petitioner Reeves. The hearing on the rule to dismiss commenced on October 2, 1964, and after the introduction of some testimony the court, on its own motion, but without objection of counsel, laid the matter over without action because of the pendency of the proceeding to interdict original plaintiff. Thereafter, the interdiction of Reeves was pronounced and Marguerite Reeves Wenner was appointed curator. Presenting her letters of curatorship in this matter, she was then substituted as party-plaintiff to act in the place and stead of original petitioner. After the interdiction had been pronounced, but without further action taken in the instant matter, defendant, plaintiff in rule, moved the district court for decision on his rule to dismiss. As a result of this motion, the district court recalled, vacated, and set aside the rule to show cause why the matter should not be dismissed, stating “ * * * this Court does not believe that it should now decide the motion on the basis of the abbreviated evidence now in the record.” Application was made to this court for writs of certiorari, prohibition and mandamus and such application was denied on January 29, 1968. Thereupon, defendant entered a devolutive appeal. It is our bounden duty to notice ex-officio appellant’s lack of right to take an appeal from the harmless interlocutory judgment. An appeal can be dismissed at any time because there is no right to appeal. C.C.P. Art. 2162. For the reasons above assigned, the appeal herein is dismissed. Dismissed. | 07-29-2022 | [
"LEAR, Judge. This appeal arises from a matter wherein the purported sale of certain lands and mineral interests situated in Rapides Parish are alleged to be null and void. Plaintiff pleaded fraud, error, failure of consideration, lesion beyond moity, depletion of patrimony, and “ * * * that the plaintiff is passed seventy-nine (79) years of age and is in poor health, and is not now, nor was he as of the date of March 13 and 14, 1963, as sharp in mind and memory as he has been in the past; that the defendant is a nephew of the plaintiff and that he well knew of the plaintiff’s physical and mental condition at the time of the above-mentioned transactions.” *183After answer and reconventional demand had been filed, defendant ruled petitioner into court to show cause why the suit should not be dismissed, basing his assertion on an alleged settlement entered into between the parties.",
"Prior to the trial of this rule, one Cordia O’Neal petitioned the court for the interdiction of the plaintiff, in a proceeding separate from the instant case, and was appointed provisional curator of Louis (Louie) Reeves. Appearing herein as provisional curator, she moved for and obtained an order of court substituting her as party-plaintiff to act in the place and stead of the original petitioner. In her representative capacity, Cordia O’Neal then answered the rule to dismiss and set forth the incompetency of original petitioner, alleging that such incompetency was notorious and was generally known by persons who saw and conversed with petitioner Reeves. The hearing on the rule to dismiss commenced on October 2, 1964, and after the introduction of some testimony the court, on its own motion, but without objection of counsel, laid the matter over without action because of the pendency of the proceeding to interdict original plaintiff. Thereafter, the interdiction of Reeves was pronounced and Marguerite Reeves Wenner was appointed curator.",
"Presenting her letters of curatorship in this matter, she was then substituted as party-plaintiff to act in the place and stead of original petitioner. After the interdiction had been pronounced, but without further action taken in the instant matter, defendant, plaintiff in rule, moved the district court for decision on his rule to dismiss. As a result of this motion, the district court recalled, vacated, and set aside the rule to show cause why the matter should not be dismissed, stating “ * * * this Court does not believe that it should now decide the motion on the basis of the abbreviated evidence now in the record.” Application was made to this court for writs of certiorari, prohibition and mandamus and such application was denied on January 29, 1968.",
"Thereupon, defendant entered a devolutive appeal. It is our bounden duty to notice ex-officio appellant’s lack of right to take an appeal from the harmless interlocutory judgment. An appeal can be dismissed at any time because there is no right to appeal. C.C.P. Art. 2162. For the reasons above assigned, the appeal herein is dismissed. Dismissed."
] | https://www.courtlistener.com/api/rest/v3/opinions/7428072/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Arnulfo Salas v. State
COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 2-02-110-CR
ARNULFO SALAS APPELLANT
V.
THE STATE OF TEXAS STATE
------------
FROM THE 396TH DISTRICT COURT OF TARRANT COUNTY
------------
MEMORANDUM OPINION (footnote: 1) Appellant Arnulfo Salas appeals from his conviction for intoxication manslaughter. Salas entered an open plea of guilty and was sentenced to fifteen years’ imprisonment. In a single point, he contends the trial court abused its discretion in assessing his sentence. We will affirm.
Following Salas’s guilty plea, the trial court deferred a finding of guilt and ordered a pre-sentence investigation report. After reviewing the report and the evidence and testimony offered at the sentencing hearing, the trial court assessed punishment at fifteen years’ imprisonment.
We review a sentence imposed by the trial court for abuse of discretion. Jackson v. State , 680 S.W.2d 809, 814 (Tex. Crim. App. 1984). As a general rule, a penalty assessed within the proper punishment range will not be disturbed on appeal. Id.
Salas claims the trial court abused its discretion in sentencing him to fifteen years’ imprisonment by failing to take into account his acceptance of responsibility, his efforts towards rehabilitation, and his family and work responsibilities. He cites Jackson for the proposition that a trial court may abuse its discretion in sentencing even if the punishment assessed falls within the range of punishment prescribed for a particular offense. Id.
In Jackson , the court held that the trial court's use, over objection, of a pre-sentence investigation report in determining what punishment would be assessed was error. Id. In addressing the harmfulness of the error, the court noted there was no other evidence before the trial court to base its determination as to punishment on other than the pre-sentence investigation report, which could not be considered. Id. Under the limited facts of that case, the court held that the trial court abused its discretion in sentencing the defendant where there was no evidence upon which the punishment decision could have been made. Id.
Here, there was ample evidence upon which the trial court based its decision – a pre-sentence investigation report and the testimony of eight witnesses, including Salas. Additionally, Salas’s sentence was within the proper range of punishment for intoxication manslaughter, a second degree felony. See Tex. Penal Code Ann. §§ 12.33, 49.08 (Vernon 1994 & Supp. 2003). Given that the punishment is within the statutory limits of punishment and considering the record presented, we cannot say that the court abused its discretion in assessing Salas’s punishment. See Bonfanti v. State , 686 S.W.2d 149, 153 (Tex. Crim. App. 1985). We overrule appellant’s sole point.
We affirm the trial court’s judgment.
PER CURIAM
PANEL F: WALKER, J.; CAYCE, C.J.; and GARDNER, J.
DO NOT PUBLISH
Tex. R. App. P. 47.2(b)
[Delivered February 6, 2003]
FOOTNOTES 1:See Tex. R. App. P. 47.4. | 09-03-2015 | [
"Arnulfo Salas v. State COURT OF APPEALS SECOND DISTRICT OF TEXAS FORT WORTH NO. 2-02-110-CR ARNULFO SALAS APPELLANT V. THE STATE OF TEXAS STATE ------------ FROM THE 396TH DISTRICT COURT OF TARRANT COUNTY ------------ MEMORANDUM OPINION (footnote: 1) Appellant Arnulfo Salas appeals from his conviction for intoxication manslaughter. Salas entered an open plea of guilty and was sentenced to fifteen years’ imprisonment. In a single point, he contends the trial court abused its discretion in assessing his sentence. We will affirm. Following Salas’s guilty plea, the trial court deferred a finding of guilt and ordered a pre-sentence investigation report. After reviewing the report and the evidence and testimony offered at the sentencing hearing, the trial court assessed punishment at fifteen years’ imprisonment.",
"We review a sentence imposed by the trial court for abuse of discretion. Jackson v. State , 680 S.W.2d 809, 814 (Tex. Crim. App. 1984). As a general rule, a penalty assessed within the proper punishment range will not be disturbed on appeal. Id. Salas claims the trial court abused its discretion in sentencing him to fifteen years’ imprisonment by failing to take into account his acceptance of responsibility, his efforts towards rehabilitation, and his family and work responsibilities.",
"He cites Jackson for the proposition that a trial court may abuse its discretion in sentencing even if the punishment assessed falls within the range of punishment prescribed for a particular offense. Id. In Jackson , the court held that the trial court's use, over objection, of a pre-sentence investigation report in determining what punishment would be assessed was error. Id. In addressing the harmfulness of the error, the court noted there was no other evidence before the trial court to base its determination as to punishment on other than the pre-sentence investigation report, which could not be considered.",
"Id. Under the limited facts of that case, the court held that the trial court abused its discretion in sentencing the defendant where there was no evidence upon which the punishment decision could have been made. Id. Here, there was ample evidence upon which the trial court based its decision – a pre-sentence investigation report and the testimony of eight witnesses, including Salas. Additionally, Salas’s sentence was within the proper range of punishment for intoxication manslaughter, a second degree felony. See Tex.",
"Penal Code Ann. §§ 12.33, 49.08 (Vernon 1994 & Supp. 2003). Given that the punishment is within the statutory limits of punishment and considering the record presented, we cannot say that the court abused its discretion in assessing Salas’s punishment. See Bonfanti v. State , 686 S.W.2d 149, 153 (Tex. Crim. App. 1985). We overrule appellant’s sole point. We affirm the trial court’s judgment. PER CURIAM PANEL F: WALKER, J.; CAYCE, C.J. ; and GARDNER, J. DO NOT PUBLISH Tex. R. App. P. 47.2(b) [Delivered February 6, 2003] FOOTNOTES 1:See Tex. R. App.",
"P. 47.4."
] | https://www.courtlistener.com/api/rest/v3/opinions/2845688/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Allowable Subject Matter Claims 1, 3, 6, 8, 15-16, 14, and 28 are allowed. The following is an examiner’s statement of reasons for allowance: Independent claims 1, 6, 15-16 have been amended to overcome the prior art of record. The prior art fails to teach wherein the value of the specific bit being 0 indicates that the transmission mode of the data scheduled by the control information is a single antenna transmission mode, and wherein the value of the specific bit being 1 indicates that the transmission mode of the data scheduled by the control information is a transmit diversity mode, as argued by applicant. Claim 3 depends on claim 1. Therefore, it is allowable. Claim 8 depends on claim 6. Therefore, it is allowable. Claim 24 depends on claim 15. Therefore, it is allowable. Claim 28 depends on claim 16. Therefore, it is allowable. Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.” Conclusion Any inquiry concerning this communication or earlier communications from the examiner should be directed to DAVID Q NGUYEN whose telephone number is (571)272-7844. The examiner can normally be reached on Monday-Friday 7:00 AM - 3:00 PM. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Jinsong Hu can be reached on 5712723965. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
/DAVID Q NGUYEN/Primary Examiner, Art Unit 2643 | 2021-10-06T08:30:43 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Allowable Subject Matter Claims 1, 3, 6, 8, 15-16, 14, and 28 are allowed. The following is an examiner’s statement of reasons for allowance: Independent claims 1, 6, 15-16 have been amended to overcome the prior art of record. The prior art fails to teach wherein the value of the specific bit being 0 indicates that the transmission mode of the data scheduled by the control information is a single antenna transmission mode, and wherein the value of the specific bit being 1 indicates that the transmission mode of the data scheduled by the control information is a transmit diversity mode, as argued by applicant.",
"Claim 3 depends on claim 1. Therefore, it is allowable. Claim 8 depends on claim 6. Therefore, it is allowable. Claim 24 depends on claim 15. Therefore, it is allowable. Claim 28 depends on claim 16. Therefore, it is allowable. Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.” Conclusion Any inquiry concerning this communication or earlier communications from the examiner should be directed to DAVID Q NGUYEN whose telephone number is (571)272-7844. The examiner can normally be reached on Monday-Friday 7:00 AM - 3:00 PM.",
"Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Jinsong Hu can be reached on 5712723965. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair.",
"Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. /DAVID Q NGUYEN/Primary Examiner, Art Unit 2643"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-09-26.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
File No . 33-11752 811-05021 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-1A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X] Pre-Effective Amendment No. [] Post-Effective Amendment No. 58 [X] and/or REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X] Amendment No. 58 [X] (Check appropriate box or boxes.) Dreyfus Premier Short-Intermediate Municipal Bond Fund (Exact Name of Registrant as Specified in Charter) c/o The Dreyfus Corporation 200 Park Avenue, New York, New York 10166 (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, including Area Code: (212) 922-6400 Bennett A. MacDougall, Esq. 200 Park Avenue New York, New York 10166 (Name and Address of Agent for Service) It is proposed that this filing will become effective (check appropriate box) X immediately upon filing pursuant to paragraph (b) on (date) pursuant to paragraph (b) (days) days after filing pursuant to paragraph (a)(1) on (date) pursuant to paragraph (a)(1) (days) days after filing pursuant to paragraph (a)(2) on (date) pursuant to paragraph (a)(2) of Rule 485 If appropriate, check the following box: this post-effective amendment designates a new effective date for a previously filed post-effective amendment. SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has duly caused this Amendment to the Registration Statement to be signed on its behalf by the undersigned, duly authorized, in the City of New York, and State of New York on the 11 th day of August 2017. Dreyfus Premier Short-Intermediate Municipal Bond Fund BY: /s/ Bradley J. Skapyak * Bradley J. Skapyak, PRESIDENT Pursuant to the requirements of the Securities Act of 1933, this Amendment to the Registration Statement has been signed below by the following persons in the capacities and on the date indicated. Signatures Title Date /s/ Bradley J. Skapyak * President (Principal Executive Officer) 8/11/17 Bradley J. Skapyak /s/ James Windels * Treasurer (Principal Financial Officer and Accounting Officer) 8/11/17 James Windels /s/ Joseph S. DiMartino * Chairman of the Board 8/11/17 Joseph S. DiMartino /s/ Francine J. Bovich * Board Member 8/11/17 Francine J. Bovich /s/ J. Charles Cardona * Board Member 8/11/17 J. Charles Cardona /s/ Gordon J. Davis * Board Member 8/11/17 Gordon J. Davis /s/ Isabel P. Dunst * Board Member 8/11/17 Isabel P. Dunst /s/ Robin A. Melvin * Board Member 8/11/17 Robin A. Melvin /s/ Nathan Leventhal * Board Member 8/11/17 Nathan Leventhal /s/ Roslyn M. Watson * Board Member 8/11/17 Roslyn M. Watson /s/ Benaree Pratt Wiley * Board Member 8/11/17 Benaree Pratt Wiley * BY: /s/ Maureen E. Kane Maureen E. Kane Attorney-in-Fact INDEX OF EXHIBITSExhibits EX-101.INS Instance Document.EX-101.SCH Taxonomy.EX-101.CAL Calculation Linkbase.EX-101.DEF Definition Linkbase.EX-101.LAB Labels Linkbase.EX-101.PRE Presentation Linkbase. | [
"File No . 33-11752 811-05021 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-1A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X] Pre-Effective Amendment No. [] Post-Effective Amendment No. 58 [X] and/or REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X] Amendment No. 58 [X] (Check appropriate box or boxes.) Dreyfus Premier Short-Intermediate Municipal Bond Fund (Exact Name of Registrant as Specified in Charter) c/o The Dreyfus Corporation 200 Park Avenue, New York, New York 10166 (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, including Area Code: (212) 922-6400 Bennett A. MacDougall, Esq. 200 Park Avenue New York, New York 10166 (Name and Address of Agent for Service) It is proposed that this filing will become effective (check appropriate box) X immediately upon filing pursuant to paragraph (b) on (date) pursuant to paragraph (b) (days) days after filing pursuant to paragraph (a)(1) on (date) pursuant to paragraph (a)(1) (days) days after filing pursuant to paragraph (a)(2) on (date) pursuant to paragraph (a)(2) of Rule 485 If appropriate, check the following box: this post-effective amendment designates a new effective date for a previously filed post-effective amendment.",
"SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has duly caused this Amendment to the Registration Statement to be signed on its behalf by the undersigned, duly authorized, in the City of New York, and State of New York on the 11 th day of August 2017. Dreyfus Premier Short-Intermediate Municipal Bond Fund BY: /s/ Bradley J. Skapyak * Bradley J. Skapyak, PRESIDENT Pursuant to the requirements of the Securities Act of 1933, this Amendment to the Registration Statement has been signed below by the following persons in the capacities and on the date indicated.",
"Signatures Title Date /s/ Bradley J. Skapyak * President (Principal Executive Officer) 8/11/17 Bradley J. Skapyak /s/ James Windels * Treasurer (Principal Financial Officer and Accounting Officer) 8/11/17 James Windels /s/ Joseph S. DiMartino * Chairman of the Board 8/11/17 Joseph S. DiMartino /s/ Francine J. Bovich * Board Member 8/11/17 Francine J. Bovich /s/ J. Charles Cardona * Board Member 8/11/17 J. Charles Cardona /s/ Gordon J. Davis * Board Member 8/11/17 Gordon J. Davis /s/ Isabel P. Dunst * Board Member 8/11/17 Isabel P. Dunst /s/ Robin A. Melvin * Board Member 8/11/17 Robin A. Melvin /s/ Nathan Leventhal * Board Member 8/11/17 Nathan Leventhal /s/ Roslyn M. Watson * Board Member 8/11/17 Roslyn M. Watson /s/ Benaree Pratt Wiley * Board Member 8/11/17 Benaree Pratt Wiley * BY: /s/ Maureen E. Kane Maureen E. Kane Attorney-in-Fact INDEX OF EXHIBITSExhibits EX-101.INS Instance Document.EX-101.SCH Taxonomy.EX-101.CAL Calculation Linkbase.EX-101.DEF Definition Linkbase.EX-101.LAB Labels Linkbase.EX-101.PRE Presentation Linkbase."
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
|
Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . This communication is responsive to After Final Consideration 2.0 (AFP2.0). The applicant amended Claim 1 to include “…A hearing aid comprising: ... a moulded interconnect device (MID) housing, wherein the MID housing is a hearing aid housing.” However, upon further search, the examiner found a new reference to Platz, Rainer (EP1681903 A2) that teaches [0020] in the case in which the antenna unit is formed by an angled portion of the housing, the device is preferably manufactured by forming the housing with the integrated antenna unit and mounting the signal processing unit within the housing. Preferably the antenna unit is integrated into the housing by a moulded interconnect device (MID) technique. [0024] teaches according to another alternative embodiment the antenna is integrated into the housing during shaping of the housing, wherein the housing preferably is shaped by injection molding in a molding tool, wherein the loop like conductor is inserted into the molding tool and is overmoulded in the moulding tool. All these techniques of moulding the housing when the antenna is integrated into the housing are known as moulded interconnect device (MID) techniques. [0047], [0048]. Thus, Platz teaches the hearing aid housing is a MID housing. /SUNITA JOSHI/Primary Examiner, Art Unit 2651 | 2022-05-16T00:33:00 | [
"Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . This communication is responsive to After Final Consideration 2.0 (AFP2.0). The applicant amended Claim 1 to include “…A hearing aid comprising: ... a moulded interconnect device (MID) housing, wherein the MID housing is a hearing aid housing.” However, upon further search, the examiner found a new reference to Platz, Rainer (EP1681903 A2) that teaches [0020] in the case in which the antenna unit is formed by an angled portion of the housing, the device is preferably manufactured by forming the housing with the integrated antenna unit and mounting the signal processing unit within the housing. Preferably the antenna unit is integrated into the housing by a moulded interconnect device (MID) technique.",
"[0024] teaches according to another alternative embodiment the antenna is integrated into the housing during shaping of the housing, wherein the housing preferably is shaped by injection molding in a molding tool, wherein the loop like conductor is inserted into the molding tool and is overmoulded in the moulding tool. All these techniques of moulding the housing when the antenna is integrated into the housing are known as moulded interconnect device (MID) techniques. [0047], [0048]. Thus, Platz teaches the hearing aid housing is a MID housing. /SUNITA JOSHI/Primary Examiner, Art Unit 2651"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-05-15.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
600 So.2d 440 (1992) John Thomas LANDRETH v. STATE. CR-90-1434. Court of Criminal Appeals of Alabama. April 17, 1992. Rehearing Denied May 29, 1992. *443 Michael D. Cook, Valley, for appellant. James H. Evans, Atty. Gen., and Margaret S. Childers, Asst. Atty. Gen., for appellee. TAYLOR, Judge. On November 7, 1988, the appellant, John Thomas Landreth, was convicted of the murder of Michael Crane, in violation of § 13A-6-2, Code of Alabama 1975. He was sentenced to 20 years' imprisonment. On June 21, 1989, the appellant moved for a new trial, and a hearing on that motion was held on August 4, 1989. Because of the illness of an essential witness, however, the hearing was continued until April 8, 1991. The appellant's new trial motion was subsequently denied. He then filed a notice of appeal on June 26, 1991, but the appeal was dismissed for noncompliance with A.R.App.P. 587 So.2d 1113. On August 5, 1991, the appellant was granted this out-of-time appeal. The state's evidence tended to show that, on the afternoon of December 11, 1987, the appellant shot and killed Michael Crane, his sister's husband, at the victim's residence in Chambers County, with a Remington semi-automatic 30-06 caliber rifle. Just before the shooting, Crane, his wife, and their two children were standing on a deck behind their house. The appellant, who lived next door and who was standing on his back deck about 50 yards away from Crane, yelled and pointed a rifle at Crane. He lowered the rifle and Crane's 10-year-old son ran into the house, returning with a Winchester 30-30 lever-action rifle. Crane then held the rifle up and pointed it in the direction of the appellant. The appellant said, "I am going to kill you, you son of a bitch" and shot his rifle. After pushing his children into the house, Crane fired a shot into the air, away from the appellant. The appellant then shot again, this time hitting Crane in the upper chest or shoulder, fatally wounding him. The motive for the homicide is not at all clear. Crane and his family had recently moved into their house. The house had been occupied by the appellant's parents until his parents' divorce proceeding began. The appellant presents five issues on appeal.
I Initially, the appellant contends that the trial court committed reversible error by denying his motion to suppress the following evidence: two statements that he made, the murder weapon, and two spent cartridges. The state's evidence tended to show that Lanett Chief of Police Robert Vincent arrived at the scene of the crime and ascertained from bystanders that the appellant, who Vincent noticed was watching from his deck next door, had shot the victim. Vincent and two other officers then walked to the appellant's residence and asked "Who fired the round?" (R. 629.) When the appellant indicated that he had, Vincent asked where the rifle was. The appellant told them that it was "in the house in the corner" and started to enter the premises. Chief Vincent, however, stepped in front of the appellant, entered the premises, and retrieved a Remington semi-automatic 30-06 caliber rifle. (R. 579.) The officer inspected the rifle and noted that the safety was off, one cartridge was in the chamber and four others were in the clip. Vincent seized only the gun and made no further search of the premises. The appellant was then arrested and was taken to the police station, where he later made a tape-recorded statement after being advised of his rights under Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966). *444 After seizing the rifle, Vincent returned to the victim's residence, where he found a spent cartridge from the victim's gun. He then returned to the appellant's yard and discovered two spent 30-06 cartridges in the grass below the deck. Initially, the appellant argues that the statements he made at the scene of the crime and the gun and spent cartridges that were seized should have been suppressed. He contends that the seizure the gun and the cartridges resulted from illegal questions asked of him after he had been taken into custody but before he had been advised of his Miranda rights. Miranda safeguards do not apply when one is not "in custody." Hubbard v. State, 500 So.2d 1204 (Ala.Cr.App.), affirmed, 500 So.2d 1231 (Ala.1986), cert. denied, 480 U.S. 940, 107 S.Ct. 1591, 94 L.Ed.2d 780 (1987). Whether one is "in custody" turns on whether "a reasonable person in the defendant's position would believe that he is not free to leave." Robinson v. State, 574 So.2d 910, 913 (Ala.Cr. App.1990). Furthermore, even if one is in custody, the procedural safeguards "outlined in Miranda are required not where a suspect is simply taken into custody, but rather where a suspect in custody is subjected to interrogation." Rhode Island v. Innis, 446 U.S. 291, 300, 100 S.Ct. 1682, 1689, 64 L.Ed.2d 297 (1980). In deciding whether the questioning of a suspect is "custodial," the following factors should be considered: "whether the suspect was questioned in familiar or neutral surroundings, the number of law enforcement officers present at the scene, the degree of physical restraint of the suspect, the duration and character of questioning, how the suspect got to the place of questioning, the language used to summon the suspect, the extent to which the suspect is confronted with evidence of guilt, and the degree of pressure applied to detain the suspect." P.S. v. State, 565 So.2d 1209, 1214 (Ala.Cr. App.1990). See also, Finch v. State, 518 So.2d 864 (Ala.Cr.App.1987). The facts as set out above indicate that the appellant was not under custodial interrogation and was not in custody when the police asked him who did the shooting and where the gun was located. We hold that the circuit court did not err in denying the motion to suppress the statements, the gun, and the cartridges on these grounds. The appellant further contends that the circuit court erred when it received the 30-06 rifle and its spent cartridges into evidence. He asserts that they were the fruits of independent warrantless searches, each of which was unconstitutionally conducted. The appellant also contends that the statement procured at the police station should have been suppressed because it involved responses to questions regarding the illegally obtained spent cartridges. Although warrantless searches and seizures are per se unreasonable, an exception is recognized where probable cause coincides with exigent circumstances. See, generally, Youtz v. State, 494 So.2d 189 (Ala.Cr.App.1986). The search and the arrest in this case were supported by probable cause because the appellant admitted to officers at the scene that he had done the shooting. See, e.g., Smith v. State, 466 So.2d 1026 (Ala.Cr.App.1985). Exigent circumstances exist when officers are faced with a situation where the immediate safety of the public is threatened. Jones v. State, 49 Ala.App. 438, 272 So.2d 910 (1973). See also, 2 W. LaFave, Search and Seizure: A Treatise on the Fourth Amendment § 6.5(d) (2d ed. 1987). An officer's compelling need to protect himself or innocent bystanders outweighs an accused's constitutional rights, so long as the action taken to remove the threat is reasonable. See, e.g., Bragg v. State, 536 So.2d 965 (Ala.Cr.App.1988); Edwards v. State, 515 So.2d 86 (Ala.Cr. App.1987). Cf., King v. State, 521 So.2d 1042 (Ala.Cr.App.1987), cert. denied, 521 So.2d 1050 (Ala.1988). In this case, the appellant admitted to the officers that he had done the shooting and told them the exact location of the *445 weapon. Having been told that the rifle was just inside the house, but not knowing whether anyone else was in the house, Chief Vincent acted reasonably to protect himself, his fellow officers, and several bystanders by stepping in front of the appellant, entering the premises, seizing the rifle, and leaving the house immediately thereafter. According to the facts as recited above, Vincent's taking possession of the murder weapon did not constitute an unreasonable search and seizure and thus did not violate the appellant's Fourth Amendment protections. See, e.g., Pope v. State, 367 So.2d 998 (Ala.Cr.App.1979). Further, the trial court did not err by allowing the two spent 30-06 cartridges to be received into evidence, despite the fact that they were seized pursuant to a warrantless search. Under the plain view exception to the warrant requirement, an officer may seize evidence of a crime if he is legitimately on the premises where he views the evidence and if the incriminating nature of the evidence is "immediately apparent." Williams v. State, 527 So.2d 764 (Ala.Cr.App.1987).[1] Where officers are lawfully on the scene investigating a crime and evidence is observed in plain view, that evidence may be lawfully seized, despite the absence of a search warrant. Duck v. State, 518 So.2d 857 (Ala.Cr.App.1987); Smith, supra; Pearson v. State, 356 So.2d 776 (Ala.Cr.App.1978). In this case, Vincent was legitimately on the scene of the crime when he discovered the cartridges. Thus, the plain view exception would apply to the warrantless seizure of the spent cartridges. No error was committed by the trial court in denying the appellant's motion to suppress.
II The appellant further contends that the trial court erred by denying his motion for a new trial. First, the appellant argues that he should have been granted a new trial based on the state's failure to produce exculpatory evidence, i.e., a tape-recorded statement by the appellant and various photographs, in violation of a discovery order. Before trial, appellant's counsel filed a motion for discovery, requesting, among other things, any written or recorded statement made by his client and any photographs that would aid the defense in the preparation of its case. The record, however, reveals no ruling on that motion. Accordingly, this issue has not been preserved. Review on appeal is limited to matters as to which the trial court makes adverse rulings. Donahoo v. State, 552 So.2d 887 (Ala.Cr.App.1989); Jackson v. State, 484 So.2d 1174 (Ala.Cr.App.1985). Appellant's counsel further contends that the trial court erred in denying his motion for a new trial on the ground of newly discovered evidence. In order to establish that a new trial is warranted based on newly discovered evidence, the appellant must demonstrate: "(1) that the evidence will probably change the result if a new trial is granted; (2) that the evidence has been discovered since the trial; (3) that the evidence could not have been discovered before the trial by the exercise of due diligence; (4) that it is material to the issue [of the appellant's guilt]; and (5) that it is not merely cumulative or impeaching." Marks v. State, 575 So.2d 611, 616 (Ala.Cr. App.1990); Stout v. State, 547 So.2d 894, 897-98 (Ala.Cr.App.1988), affirmed, 547 So.2d 901 (Ala.1989). The circuit judge is in the best position to assess whether the appellant has met his burden as to the new evidence in light of all that has previously transpired. We will accord every presumption in favor of the correctness of the circuit court's decision. Clements v. State, 521 So.2d 1378 (Ala.Cr.App.1988). *446 Appellant's counsel contends that he has newly discovered evidence tending to prove that the police tampered with a tape-recorded statement made by the appellant. After moving for a new trial, the appellant requested an opportunity to analyze the tape recording. After the court granted his request, the appellant obtained the services of an audio technician who listened to the tape. The appellant now argues that the technician's analysis is newly discovered evidence warranting a new trial. Before trial, the appellant was given a transcript of the statement, and, on the first day of trial, had an opportunity to listen to the tape. After listening to the tape, the appellant made no motion and did not seek a continuance. The technician's testimony could have been obtained before trial and therefore does not qualify as newly discovered evidence. See, e.g., Hamrick v. State, 548 So.2d 652 (Ala.Cr.App.1989); Gass v. State, 431 So.2d 1347 (Ala.Cr.App.), cert. denied, Ex parte Weldon, 431 So.2d 1350 (Ala.1983). The appellant also contends that his sister could testify to the involuntariness of the tape-recorded statement procured from him at the police station. The appellant, however, has not demonstrated that this evidence could not have been discovered before the trial through the exercise of due diligence. Dossey v. State, 489 So.2d 662 (Ala.Cr.App.1986); Gass, supra. Finally, the appellant argues that a juror's failure to respond truthfully to a question on voir dire that would have disqualified her as a juror and denied his right to a fair and impartial trial. The appellant contends that Mrs. Betty Woody, whose husband is a police officer, failed to disclose this relationship after the venire was asked if any of them were related to a law enforcement officer. Here, the record shows that the appellant's counsel was present in the room when the roll for the venire was called, at which time Mrs. Woody stood and stated that her husband was employed with the Lafayette Police Department. Also, several veniremembers testified that when the appellant asked the venire during voir dire if any member was related to a law enforcement employee, Mrs. Woody did raise her hand and held it up until the appellant began to question another veniremember who had responded affirmatively. After he finished questioning the respondent, the appellant asked, "Anyone else related to law enforcement officials now or in the past? Anybody been employed by law enforcement?" (R. 34.) Mrs. Woody had already stated her husband's occupation and had raised her hand. She did not again raise her hand. The question suggested that counsel was seeking to determine whether anyone other than those who had already responded affirmatively was within the category. We do not find a failure to respond truthfully. In light of the above, the trial court did not err in denying the appellant's motion for a new trial upon this ground.
III The appellant's next contention is that the trial court erred by restricting his cross-examination of two witnesses. First, the appellant argues that the trial judge denied him the opportunity to elicit from Detective Sergeant Robert Chambers of the Lanett Police Department various prior inconsistent statements made by a witness who was in the victim's house at the time of the shooting, thereby unduly restricting his right to cross-examine. During his cross-examination of Chambers, the appellant asked, "[D]o you remember what [Carla Cruse, the witness] said to you? Whether or not she stated." (R. 446.) The state objected, and the trial judge sustained. No explanation or offer of proof was made. On its face, the question appeared to call for inadmissible hearsay. Because the appellant's question called for inadmissible hearsay and there was no offer of proof, the trial court did not err in sustaining the state's objection. C. Gamble, McElroy's Alabama Evidence § 425.01(5), (8) (4th ed. 1991). See also, Freeman v. State, 453 So.2d 776 (Ala. *447 Cr.App.1984); Futral v. State, 558 So.2d 991 (Ala.Cr.App.1989). Thereafter, the appellant continued his cross-examination of Chambers as follows: "Q: Did you talk to Carla [Cruse]? "A: Yes, I did. "Q: What did she say to you at that time? "[THE STATE]: Objection. "[APPELLANT]: Your Honor, I have asked her previously if she testified differently. "[THE STATE]: I don't think [the appellant] laid the proper predicate when he was asking Carla those questions. "THE COURT: I'm going to sustain the objection at this point."
(R. 447) (emphasis added). Here, the appellant did make an offer of proof, but had asked a question that, on the surface, called for a reply that is clearly hearsay. "When a question ... calls for inadmissible testimony, a mere statement by the questioning counsel that he expects a specified answer which, if made, would be legal evidence, will not put the court in error for sustaining an objection to the question." Gamble, supra; § 425.01(6). The appellant also contends that the circuit judge unduly restricted his cross-examination of Lanett Chief of Police Robert Vincent on two different occasions. We find that these issues, however, were not presented to the trial court. The appellant presents a new ground for one of his objections for the first time on appeal. Specific grounds for his objection were stated at trial and all others not specified are therefore waived. Cole v. State, 548 So.2d 1093 (Ala.Cr.App.1989). After reviewing the cross-examination set out above, we find no error.
IV The appellant also contends that the trial court erred in denying his multiple motions for mistrial based on alleged prosecutorial misconduct. However, these contentions were not preserved for appellate review. Initially, the appellant contends that, when asking certain questions, the state implied the existence of facts that could not be proven by lawful evidence. The appellant stated no grounds for his mistrial motion other than that the prosecutor was asking "impermissible" questions. A general objection that does not specify grounds preserves nothing for review. Thompson v. State, 575 So.2d 1238 (Ala.Cr. App.1991). The appellant also argues that the trial court erred in not declaring a mistrial when the state asked him a question regarding the victim's expertise with a gun. The appellant, however, did not move for a mistrial at this time. Thus, no adverse ruling was made for this court to review. Gibson v. State, 555 So.2d 784 (Ala.Cr.App. 1989); Goodson v. State, 540 So.2d 789 (Ala.Cr.App.1988). The state asked a defense witness whether he had heard that the appellant had threatened to kill the appellant's brother. After this question, the appellant moved for a mistrial without stating any ground, and the court denied the motion. Nothing was preserved for review.
V Finally, the appellant contends that the trial court erred in allowing Chief Vincent to give testimony that invaded the province of the jury. At trial, Vincent was asked to give his opinion, based on the distance between the locations of two spent cartridges, on whether the appellant's rifle was in a different position each time it was fired. The appellant objected, arguing that the question was "outside any expertise [Vincent] would have" and "calls for an unauthorized conclusion." (R. 25.) The trial judge overruled the objection. The appellant now argues that Vincent's answer invaded the province of the jury. The trial court was not given the opportunity to consider this ground. Accordingly, the trial court did not err in this instance. *448 We have considered the other issues presented by the appellant, and we conclude that no error occurred. The judgment in this case is hereby affirmed. AFFIRMED. All the Judges concur. NOTES [1] Under Horton v. California, 496 U.S. 128, 110 S.Ct. 2301, 110 L.Ed.2d 112 (1990), the requirement that the discovery of the evidence be inadvertent is no longer recognized under the plain view exception. See also, LaFave, supra, § 7.5(d). | 10-30-2013 | [
"600 So.2d 440 (1992) John Thomas LANDRETH v. STATE. CR-90-1434. Court of Criminal Appeals of Alabama. April 17, 1992. Rehearing Denied May 29, 1992. *443 Michael D. Cook, Valley, for appellant. James H. Evans, Atty. Gen., and Margaret S. Childers, Asst. Atty. Gen., for appellee. TAYLOR, Judge. On November 7, 1988, the appellant, John Thomas Landreth, was convicted of the murder of Michael Crane, in violation of § 13A-6-2, Code of Alabama 1975. He was sentenced to 20 years' imprisonment. On June 21, 1989, the appellant moved for a new trial, and a hearing on that motion was held on August 4, 1989. Because of the illness of an essential witness, however, the hearing was continued until April 8, 1991.",
"The appellant's new trial motion was subsequently denied. He then filed a notice of appeal on June 26, 1991, but the appeal was dismissed for noncompliance with A.R.App.P. 587 So.2d 1113. On August 5, 1991, the appellant was granted this out-of-time appeal. The state's evidence tended to show that, on the afternoon of December 11, 1987, the appellant shot and killed Michael Crane, his sister's husband, at the victim's residence in Chambers County, with a Remington semi-automatic 30-06 caliber rifle. Just before the shooting, Crane, his wife, and their two children were standing on a deck behind their house.",
"The appellant, who lived next door and who was standing on his back deck about 50 yards away from Crane, yelled and pointed a rifle at Crane. He lowered the rifle and Crane's 10-year-old son ran into the house, returning with a Winchester 30-30 lever-action rifle. Crane then held the rifle up and pointed it in the direction of the appellant. The appellant said, \"I am going to kill you, you son of a bitch\" and shot his rifle. After pushing his children into the house, Crane fired a shot into the air, away from the appellant. The appellant then shot again, this time hitting Crane in the upper chest or shoulder, fatally wounding him. The motive for the homicide is not at all clear. Crane and his family had recently moved into their house. The house had been occupied by the appellant's parents until his parents' divorce proceeding began.",
"The appellant presents five issues on appeal. I Initially, the appellant contends that the trial court committed reversible error by denying his motion to suppress the following evidence: two statements that he made, the murder weapon, and two spent cartridges. The state's evidence tended to show that Lanett Chief of Police Robert Vincent arrived at the scene of the crime and ascertained from bystanders that the appellant, who Vincent noticed was watching from his deck next door, had shot the victim. Vincent and two other officers then walked to the appellant's residence and asked \"Who fired the round?\" (R. 629.) When the appellant indicated that he had, Vincent asked where the rifle was. The appellant told them that it was \"in the house in the corner\" and started to enter the premises. Chief Vincent, however, stepped in front of the appellant, entered the premises, and retrieved a Remington semi-automatic 30-06 caliber rifle. (R.",
"579.) The officer inspected the rifle and noted that the safety was off, one cartridge was in the chamber and four others were in the clip. Vincent seized only the gun and made no further search of the premises. The appellant was then arrested and was taken to the police station, where he later made a tape-recorded statement after being advised of his rights under Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966). *444 After seizing the rifle, Vincent returned to the victim's residence, where he found a spent cartridge from the victim's gun. He then returned to the appellant's yard and discovered two spent 30-06 cartridges in the grass below the deck.",
"Initially, the appellant argues that the statements he made at the scene of the crime and the gun and spent cartridges that were seized should have been suppressed. He contends that the seizure the gun and the cartridges resulted from illegal questions asked of him after he had been taken into custody but before he had been advised of his Miranda rights. Miranda safeguards do not apply when one is not \"in custody.\" Hubbard v. State, 500 So.2d 1204 (Ala.Cr.App. ), affirmed, 500 So.2d 1231 (Ala.1986), cert. denied, 480 U.S. 940, 107 S.Ct. 1591, 94 L.Ed.2d 780 (1987). Whether one is \"in custody\" turns on whether \"a reasonable person in the defendant's position would believe that he is not free to leave.\" Robinson v. State, 574 So.2d 910, 913 (Ala.Cr. App.1990).",
"Furthermore, even if one is in custody, the procedural safeguards \"outlined in Miranda are required not where a suspect is simply taken into custody, but rather where a suspect in custody is subjected to interrogation.\" Rhode Island v. Innis, 446 U.S. 291, 300, 100 S.Ct. 1682, 1689, 64 L.Ed.2d 297 (1980). In deciding whether the questioning of a suspect is \"custodial,\" the following factors should be considered: \"whether the suspect was questioned in familiar or neutral surroundings, the number of law enforcement officers present at the scene, the degree of physical restraint of the suspect, the duration and character of questioning, how the suspect got to the place of questioning, the language used to summon the suspect, the extent to which the suspect is confronted with evidence of guilt, and the degree of pressure applied to detain the suspect.\" P.S.",
"v. State, 565 So.2d 1209, 1214 (Ala.Cr. App.1990). See also, Finch v. State, 518 So.2d 864 (Ala.Cr.App.1987). The facts as set out above indicate that the appellant was not under custodial interrogation and was not in custody when the police asked him who did the shooting and where the gun was located. We hold that the circuit court did not err in denying the motion to suppress the statements, the gun, and the cartridges on these grounds. The appellant further contends that the circuit court erred when it received the 30-06 rifle and its spent cartridges into evidence. He asserts that they were the fruits of independent warrantless searches, each of which was unconstitutionally conducted. The appellant also contends that the statement procured at the police station should have been suppressed because it involved responses to questions regarding the illegally obtained spent cartridges. Although warrantless searches and seizures are per se unreasonable, an exception is recognized where probable cause coincides with exigent circumstances.",
"See, generally, Youtz v. State, 494 So.2d 189 (Ala.Cr.App.1986). The search and the arrest in this case were supported by probable cause because the appellant admitted to officers at the scene that he had done the shooting. See, e.g., Smith v. State, 466 So.2d 1026 (Ala.Cr.App.1985). Exigent circumstances exist when officers are faced with a situation where the immediate safety of the public is threatened. Jones v. State, 49 Ala.App. 438, 272 So.2d 910 (1973). See also, 2 W. LaFave, Search and Seizure: A Treatise on the Fourth Amendment § 6.5(d) (2d ed. 1987). An officer's compelling need to protect himself or innocent bystanders outweighs an accused's constitutional rights, so long as the action taken to remove the threat is reasonable.",
"See, e.g., Bragg v. State, 536 So.2d 965 (Ala.Cr.App.1988); Edwards v. State, 515 So.2d 86 (Ala.Cr. App.1987). Cf., King v. State, 521 So.2d 1042 (Ala.Cr.App.1987), cert. denied, 521 So.2d 1050 (Ala.1988). In this case, the appellant admitted to the officers that he had done the shooting and told them the exact location of the *445 weapon. Having been told that the rifle was just inside the house, but not knowing whether anyone else was in the house, Chief Vincent acted reasonably to protect himself, his fellow officers, and several bystanders by stepping in front of the appellant, entering the premises, seizing the rifle, and leaving the house immediately thereafter. According to the facts as recited above, Vincent's taking possession of the murder weapon did not constitute an unreasonable search and seizure and thus did not violate the appellant's Fourth Amendment protections. See, e.g., Pope v. State, 367 So.2d 998 (Ala.Cr.App.1979).",
"Further, the trial court did not err by allowing the two spent 30-06 cartridges to be received into evidence, despite the fact that they were seized pursuant to a warrantless search. Under the plain view exception to the warrant requirement, an officer may seize evidence of a crime if he is legitimately on the premises where he views the evidence and if the incriminating nature of the evidence is \"immediately apparent.\" Williams v. State, 527 So.2d 764 (Ala.Cr.App.1987). [1] Where officers are lawfully on the scene investigating a crime and evidence is observed in plain view, that evidence may be lawfully seized, despite the absence of a search warrant. Duck v. State, 518 So.2d 857 (Ala.Cr.App.1987); Smith, supra; Pearson v. State, 356 So.2d 776 (Ala.Cr.App.1978). In this case, Vincent was legitimately on the scene of the crime when he discovered the cartridges. Thus, the plain view exception would apply to the warrantless seizure of the spent cartridges.",
"No error was committed by the trial court in denying the appellant's motion to suppress. II The appellant further contends that the trial court erred by denying his motion for a new trial. First, the appellant argues that he should have been granted a new trial based on the state's failure to produce exculpatory evidence, i.e., a tape-recorded statement by the appellant and various photographs, in violation of a discovery order.",
"Before trial, appellant's counsel filed a motion for discovery, requesting, among other things, any written or recorded statement made by his client and any photographs that would aid the defense in the preparation of its case. The record, however, reveals no ruling on that motion. Accordingly, this issue has not been preserved. Review on appeal is limited to matters as to which the trial court makes adverse rulings.",
"Donahoo v. State, 552 So.2d 887 (Ala.Cr.App.1989); Jackson v. State, 484 So.2d 1174 (Ala.Cr.App.1985). Appellant's counsel further contends that the trial court erred in denying his motion for a new trial on the ground of newly discovered evidence. In order to establish that a new trial is warranted based on newly discovered evidence, the appellant must demonstrate: \"(1) that the evidence will probably change the result if a new trial is granted; (2) that the evidence has been discovered since the trial; (3) that the evidence could not have been discovered before the trial by the exercise of due diligence; (4) that it is material to the issue [of the appellant's guilt]; and (5) that it is not merely cumulative or impeaching.\"",
"Marks v. State, 575 So.2d 611, 616 (Ala.Cr. App.1990); Stout v. State, 547 So.2d 894, 897-98 (Ala.Cr.App.1988), affirmed, 547 So.2d 901 (Ala.1989). The circuit judge is in the best position to assess whether the appellant has met his burden as to the new evidence in light of all that has previously transpired. We will accord every presumption in favor of the correctness of the circuit court's decision. Clements v. State, 521 So.2d 1378 (Ala.Cr.App.1988). *446 Appellant's counsel contends that he has newly discovered evidence tending to prove that the police tampered with a tape-recorded statement made by the appellant. After moving for a new trial, the appellant requested an opportunity to analyze the tape recording. After the court granted his request, the appellant obtained the services of an audio technician who listened to the tape. The appellant now argues that the technician's analysis is newly discovered evidence warranting a new trial. Before trial, the appellant was given a transcript of the statement, and, on the first day of trial, had an opportunity to listen to the tape.",
"After listening to the tape, the appellant made no motion and did not seek a continuance. The technician's testimony could have been obtained before trial and therefore does not qualify as newly discovered evidence. See, e.g., Hamrick v. State, 548 So.2d 652 (Ala.Cr.App.1989); Gass v. State, 431 So.2d 1347 (Ala.Cr.App. ), cert. denied, Ex parte Weldon, 431 So.2d 1350 (Ala.1983). The appellant also contends that his sister could testify to the involuntariness of the tape-recorded statement procured from him at the police station. The appellant, however, has not demonstrated that this evidence could not have been discovered before the trial through the exercise of due diligence. Dossey v. State, 489 So.2d 662 (Ala.Cr.App.1986); Gass, supra. Finally, the appellant argues that a juror's failure to respond truthfully to a question on voir dire that would have disqualified her as a juror and denied his right to a fair and impartial trial.",
"The appellant contends that Mrs. Betty Woody, whose husband is a police officer, failed to disclose this relationship after the venire was asked if any of them were related to a law enforcement officer. Here, the record shows that the appellant's counsel was present in the room when the roll for the venire was called, at which time Mrs. Woody stood and stated that her husband was employed with the Lafayette Police Department. Also, several veniremembers testified that when the appellant asked the venire during voir dire if any member was related to a law enforcement employee, Mrs. Woody did raise her hand and held it up until the appellant began to question another veniremember who had responded affirmatively. After he finished questioning the respondent, the appellant asked, \"Anyone else related to law enforcement officials now or in the past? Anybody been employed by law enforcement?\"",
"(R. 34.) Mrs. Woody had already stated her husband's occupation and had raised her hand. She did not again raise her hand. The question suggested that counsel was seeking to determine whether anyone other than those who had already responded affirmatively was within the category. We do not find a failure to respond truthfully. In light of the above, the trial court did not err in denying the appellant's motion for a new trial upon this ground. III The appellant's next contention is that the trial court erred by restricting his cross-examination of two witnesses. First, the appellant argues that the trial judge denied him the opportunity to elicit from Detective Sergeant Robert Chambers of the Lanett Police Department various prior inconsistent statements made by a witness who was in the victim's house at the time of the shooting, thereby unduly restricting his right to cross-examine. During his cross-examination of Chambers, the appellant asked, \"[D]o you remember what [Carla Cruse, the witness] said to you? Whether or not she stated.\" (R. 446.)",
"The state objected, and the trial judge sustained. No explanation or offer of proof was made. On its face, the question appeared to call for inadmissible hearsay. Because the appellant's question called for inadmissible hearsay and there was no offer of proof, the trial court did not err in sustaining the state's objection. C. Gamble, McElroy's Alabama Evidence § 425.01(5), (8) (4th ed. 1991). See also, Freeman v. State, 453 So.2d 776 (Ala. *447 Cr.App.1984); Futral v. State, 558 So.2d 991 (Ala.Cr.App.1989). Thereafter, the appellant continued his cross-examination of Chambers as follows: \"Q: Did you talk to Carla [Cruse]? \"A: Yes, I did. \"Q: What did she say to you at that time? \"[THE STATE]: Objection. \"[APPELLANT]: Your Honor, I have asked her previously if she testified differently.",
"\"[THE STATE]: I don't think [the appellant] laid the proper predicate when he was asking Carla those questions. \"THE COURT: I'm going to sustain the objection at this point.\" (R. 447) (emphasis added). Here, the appellant did make an offer of proof, but had asked a question that, on the surface, called for a reply that is clearly hearsay. \"When a question ... calls for inadmissible testimony, a mere statement by the questioning counsel that he expects a specified answer which, if made, would be legal evidence, will not put the court in error for sustaining an objection to the question.\" Gamble, supra; § 425.01(6).",
"The appellant also contends that the circuit judge unduly restricted his cross-examination of Lanett Chief of Police Robert Vincent on two different occasions. We find that these issues, however, were not presented to the trial court. The appellant presents a new ground for one of his objections for the first time on appeal. Specific grounds for his objection were stated at trial and all others not specified are therefore waived. Cole v. State, 548 So.2d 1093 (Ala.Cr.App.1989).",
"After reviewing the cross-examination set out above, we find no error. IV The appellant also contends that the trial court erred in denying his multiple motions for mistrial based on alleged prosecutorial misconduct. However, these contentions were not preserved for appellate review. Initially, the appellant contends that, when asking certain questions, the state implied the existence of facts that could not be proven by lawful evidence. The appellant stated no grounds for his mistrial motion other than that the prosecutor was asking \"impermissible\" questions. A general objection that does not specify grounds preserves nothing for review. Thompson v. State, 575 So.2d 1238 (Ala.Cr.",
"App.1991). The appellant also argues that the trial court erred in not declaring a mistrial when the state asked him a question regarding the victim's expertise with a gun. The appellant, however, did not move for a mistrial at this time. Thus, no adverse ruling was made for this court to review. Gibson v. State, 555 So.2d 784 (Ala.Cr.App. 1989); Goodson v. State, 540 So.2d 789 (Ala.Cr.App.1988). The state asked a defense witness whether he had heard that the appellant had threatened to kill the appellant's brother. After this question, the appellant moved for a mistrial without stating any ground, and the court denied the motion. Nothing was preserved for review. V Finally, the appellant contends that the trial court erred in allowing Chief Vincent to give testimony that invaded the province of the jury.",
"At trial, Vincent was asked to give his opinion, based on the distance between the locations of two spent cartridges, on whether the appellant's rifle was in a different position each time it was fired. The appellant objected, arguing that the question was \"outside any expertise [Vincent] would have\" and \"calls for an unauthorized conclusion.\" (R. 25.) The trial judge overruled the objection. The appellant now argues that Vincent's answer invaded the province of the jury. The trial court was not given the opportunity to consider this ground. Accordingly, the trial court did not err in this instance. *448 We have considered the other issues presented by the appellant, and we conclude that no error occurred. The judgment in this case is hereby affirmed. AFFIRMED. All the Judges concur. NOTES [1] Under Horton v. California, 496 U.S. 128, 110 S.Ct. 2301, 110 L.Ed.2d 112 (1990), the requirement that the discovery of the evidence be inadvertent is no longer recognized under the plain view exception.",
"See also, LaFave, supra, § 7.5(d)."
] | https://www.courtlistener.com/api/rest/v3/opinions/1147223/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case 18-10601-MFW Doc 3070 Filed 11/04/20 Page 1 of 3
IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE
------------------------------------------------------------- x : : Chapter 11 THE WEINSTEIN COMPANY HOLDINGS : LLC, et al., : Case No. 18-10601 (MFW) : Debtors.1 : (Jointly Administered) : Re: Docket Nos. 2856, 2858, 2952, 2953, 2994, : 2995, 3067, & 3069 ------------------------------------------------------------- x NOTICE OF FILING OF BLACKLINES OF THIRD AMENDED PLAN AND DISCLOSURE STATEMENT
PLEASE TAKE NOTICE that, on June 30, 2020, The Weinstein Company Holdings
LLC and its affiliated debtors and debtors in possession (collectively, the “Debtors”) filed the
Debtors’ and Official Committee of Unsecured Creditors’ (the “Committee”) Joint Chapter 11 Plan of
Liquidation [Docket No. 2856] and Disclosure Statement in Support of Joint Chapter 11 Plan of
Liquidation Proposed By Debtors and Official Committee of Unsecured Creditors [Docket No. 2858]
with the United States Bankruptcy Court for the District of Delaware (the “Court”).
PLEASE TAKE FURTHER NOTICE that, on September 1, 2020, the Debtors filed the
Debtors’ First Amended Chapter 11 Plan of Liquidation [Docket No. 2952] and the First
Amended Disclosure Statement in Support of the Debtors’ First Amended Chapter 11 Plan of
Liquidation [Docket No. 2953].
PLEASE TAKE FURTHER NOTICE that on October 1, 2020, the Debtors filed the
Debtors’ and Committee’s Second Amended Joint Chapter 11 Plan of Liquidation [Docket No.
1 The last four digits of The Weinstein Company Holdings LLC’s federal tax identification number are (3837). The mailing address for The Weinstein Company Holdings LLC is 99 Hudson Street, 4th Floor, New York, New York 10013. Due to the large number of debtors in these cases, which are being jointly administered for procedural purposes only, a complete list of the Debtors and the last four digits of their federal tax identification numbers is not provided herein. A complete list of such information may be obtained on the website of the Debtors’ claims and noticing agent at http://dm.epiq11.com/twc.
RLF1 24253940v.1 Case 18-10601-MFW Doc 3070 Filed 11/04/20 Page 2 of 3
2994] (the “Second Amended Plan”) and Second Amended Disclosure Statement in Support of
the Second Amended Joint Chapter 11 Plan of Liquidation Proposed By Debtors and Official
Committee of Unsecured Creditors [Docket No. 2995] (the “Second Amended Disclosure
Statement”).
PLEASE TAKE FURTHER NOTICE that on November 4, 2020, the Debtors filed the
Debtors’ and Committee’s Third Amended Joint Chapter 11 Plan of Liquidation [Docket No.
3067] (as may be amended from time to time, the “Third Amended Plan”) and Third Amended
Disclosure Statement in Support of the Third Amended Joint Chapter 11 Plan of Liquidation
Proposed By Debtors and Official Committee of Unsecured Creditors [Docket No. 3069] (as may be
amended from time to time, the “Third Amended Disclosure Statement”).
PLEASE TAKE FURTHER NOTICE that, for the convenience of the Court and all
parties in interest, a blackline comparison of the Third Amended Plan marked against the Second
Amended Plan is attached hereto as Exhibit 1 and a blackline comparison of the Third Amended
Disclosure Statement marked against the Second Amended Disclosure Statement is attached
hereto as Exhibit 2.
Dated: November 4, 2020 Wilmington, Delaware /s/ David T. Queroli RICHARDS, LAYTON & FINGER, P.A. Mark D. Collins (No. 2981) Paul N. Heath (No. 3704) Zachary I. Shapiro (No. 5103) Brett M. Haywood (No. 6166) David T. Queroli (No. 6318) One Rodney Square 920 North King Street Wilmington, Delaware 19801 Telephone: (302) 651-7700 Facsimile: (302) 651-7701 Email: queroli@rlf.com - and -
RLF1 24253940v.1 2 Case 18-10601-MFW Doc 3070 Filed 11/04/20 Page 3 of 3
CRAVATH, SWAINE & MOORE LLP Paul H. Zumbro (admitted pro hac vice) Lauren A. Moskowitz (admitted pro hac vice) Salah M. Hawkins (admitted pro hac vice) Worldwide Plaza 825 Eighth Avenue New York, New York 10019 Telephone: (212) 474-1000 Facsimile: (212) 474-3700
Attorneys for the Debtors and Debtors in Possession
RLF1 24253940v.1 3 | 2020-11-04 | [
"Case 18-10601-MFW Doc 3070 Filed 11/04/20 Page 1 of 3 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE ------------------------------------------------------------- x : : Chapter 11 THE WEINSTEIN COMPANY HOLDINGS : LLC, et al., : Case No. 18-10601 (MFW) : Debtors.1 : (Jointly Administered) : Re: Docket Nos. 2856, 2858, 2952, 2953, 2994, : 2995, 3067, & 3069 ------------------------------------------------------------- x NOTICE OF FILING OF BLACKLINES OF THIRD AMENDED PLAN AND DISCLOSURE STATEMENT PLEASE TAKE NOTICE that, on June 30, 2020, The Weinstein Company Holdings LLC and its affiliated debtors and debtors in possession (collectively, the “Debtors”) filed the Debtors’ and Official Committee of Unsecured Creditors’ (the “Committee”) Joint Chapter 11 Plan of Liquidation [Docket No. 2856] and Disclosure Statement in Support of Joint Chapter 11 Plan of Liquidation Proposed By Debtors and Official Committee of Unsecured Creditors [Docket No.",
"2858] with the United States Bankruptcy Court for the District of Delaware (the “Court”). PLEASE TAKE FURTHER NOTICE that, on September 1, 2020, the Debtors filed the Debtors’ First Amended Chapter 11 Plan of Liquidation [Docket No. 2952] and the First Amended Disclosure Statement in Support of the Debtors’ First Amended Chapter 11 Plan of Liquidation [Docket No. 2953]. PLEASE TAKE FURTHER NOTICE that on October 1, 2020, the Debtors filed the Debtors’ and Committee’s Second Amended Joint Chapter 11 Plan of Liquidation [Docket No. 1 The last four digits of The Weinstein Company Holdings LLC’s federal tax identification number are (3837). The mailing address for The Weinstein Company Holdings LLC is 99 Hudson Street, 4th Floor, New York, New York 10013. Due to the large number of debtors in these cases, which are being jointly administered for procedural purposes only, a complete list of the Debtors and the last four digits of their federal tax identification numbers is not provided herein. A complete list of such information may be obtained on the website of the Debtors’ claims and noticing agent at http://dm.epiq11.com/twc. RLF1 24253940v.1 Case 18-10601-MFW Doc 3070 Filed 11/04/20 Page 2 of 3 2994] (the “Second Amended Plan”) and Second Amended Disclosure Statement in Support of the Second Amended Joint Chapter 11 Plan of Liquidation Proposed By Debtors and Official Committee of Unsecured Creditors [Docket No.",
"2995] (the “Second Amended Disclosure Statement”). PLEASE TAKE FURTHER NOTICE that on November 4, 2020, the Debtors filed the Debtors’ and Committee’s Third Amended Joint Chapter 11 Plan of Liquidation [Docket No. 3067] (as may be amended from time to time, the “Third Amended Plan”) and Third Amended Disclosure Statement in Support of the Third Amended Joint Chapter 11 Plan of Liquidation Proposed By Debtors and Official Committee of Unsecured Creditors [Docket No. 3069] (as may be amended from time to time, the “Third Amended Disclosure Statement”). PLEASE TAKE FURTHER NOTICE that, for the convenience of the Court and all parties in interest, a blackline comparison of the Third Amended Plan marked against the Second Amended Plan is attached hereto as Exhibit 1 and a blackline comparison of the Third Amended Disclosure Statement marked against the Second Amended Disclosure Statement is attached hereto as Exhibit 2. Dated: November 4, 2020 Wilmington, Delaware /s/ David T. Queroli RICHARDS, LAYTON & FINGER, P.A.",
"Mark D. Collins (No. 2981) Paul N. Heath (No. 3704) Zachary I. Shapiro (No. 5103) Brett M. Haywood (No. 6166) David T. Queroli (No. 6318) One Rodney Square 920 North King Street Wilmington, Delaware 19801 Telephone: (302) 651-7700 Facsimile: (302) 651-7701 Email: queroli@rlf.com - and - RLF1 24253940v.1 2 Case 18-10601-MFW Doc 3070 Filed 11/04/20 Page 3 of 3 CRAVATH, SWAINE & MOORE LLP Paul H. Zumbro (admitted pro hac vice) Lauren A. Moskowitz (admitted pro hac vice) Salah M. Hawkins (admitted pro hac vice) Worldwide Plaza 825 Eighth Avenue New York, New York 10019 Telephone: (212) 474-1000 Facsimile: (212) 474-3700 Attorneys for the Debtors and Debtors in Possession RLF1 24253940v.1 3"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/150901765/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claims 1-21 are pending and examined below. This action is in response to the claims filed 6/27/22.
Response to Amendment Applicant’s arguments, see Applicant Remarks first issue, page7, filed on 6/27/22, regarding Objection to the Drawings have been fully considered and are not found persuasive. Figure now has descriptive labels but does not have an associated Figure number. Drawing should be amended to include “Figure 1” on the bottom where it currently only states “Figure”. The objection is maintained.
Applicant’s arguments, see Applicant Remarks next issue, page 7, filed on 6/27/22, regarding 35 U.S.C. § 112(a) have been fully considered and are not found persuasive. Applicant’s remarks pointed towards an actual/setpoint comparison as support for an actual/target comparison as claimed. If the target is supposed to be a preestablished setpoint value, then this must be explicitly claimed. As currently written, the actual/target comparison does not have sufficient explanation or support within the specification. The rejection is maintained.
Applicant’s arguments, see Applicant Remarks 35 U.S.C. § 112(b), page 8, filed on 6/27/22, regarding 35 U.S.C. § 112(b) have been fully considered and are found persuasive in view of amendments of 6/27/22. 35 U.S.C. § 112(b) rejections are withdrawn.
Applicant’s arguments, see Applicant Remarks 35 U.S.C. § 103, page 8-11, filed on 6/27/22, regarding 35 U.S.C. §103 have been fully considered and are not found persuasive. Regarding applicant’s assertion that Lettow in view of Breed differs from the present invention by means of sensing emitted signals vs the component’s own body signals, page 8, a similar argument to that in the Non-Final of 12/27/21 is reiterated. Differentiating features must be explicitly claimed in order to define over the art. Claims as written do not sufficiently make this distinction. Therefore the rejection is maintained. Regarding applicant’s assertion that Breed is silent to the location of the sensor being in a component, page 9, Breed discloses in Figure 3 and ¶717 “several components and several sensors is shown in their approximate locations on a vehicle”. Wheel sensors 14 and 20 are either in or on the wheel, and the fact that the sensors are shown in their approximate location covers all locations within the relative vicinity of the locations in the picture including the corresponding to the recited in the component. Further support within Fig. 38 and ¶965 more explicitly shows a sensor 270 is placed within the tire 266. Therefore the rejection is maintained. Regarding applicant’s discussion on pages 9-11 regarding the distinguishing features of the invention over the prior art, while there may be differences between the invention and the aspects of the references as cited, these distinguishing features must be explicitly claimed. Teachings within the specification and applicant’s remarks section are not sufficient to overcome the rejection of the claims as written over the art of record. The office advises the utilization of interviews in the process of creating the most efficient and constructive examination process in that the interpretations of the examiner and applicant of both the art of record as well as the present application are expressed in a mutual agreement in order to create and push forward the most productive discussions/amendments to move towards allowance.
Amendments to claim 20 are addressed below with respect to the art of record.
Drawings The drawings are objected to because the figure now has descriptive labels but does not have an associated Figure number. Drawing should be amended to include “Figure 1” on the bottom where it currently only states “Figure”. Corrected drawing sheets in compliance with 37 CFR 1.121(d) are required in reply to the Office action to avoid abandonment of the application. Any amended replacement drawing sheet should include all of the figures appearing on the immediate prior version of the sheet, even if only one figure is being amended. The figure or figure number of an amended drawing should not be labeled as “amended.” If a drawing figure is to be canceled, the appropriate figure must be removed from the replacement sheet, and where necessary, the remaining figures must be renumbered and appropriate changes made to the brief description of the several views of the drawings for consistency. Additional replacement sheets may be necessary to show the renumbering of the remaining figures. Each drawing sheet submitted after the filing date of an application must be labeled in the top margin as either “Replacement Sheet” or “New Sheet” pursuant to 37 CFR 1.121(d). If the changes are not accepted by the examiner, the applicant will be notified and informed of any required corrective action in the next Office action. The objection to the drawings will not be held in abeyance.
Claim Rejections - 35 USC § 112 The following is a quotation of the first paragraph of 35 U.S.C. 112(a): (a) IN GENERAL.—The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor or joint inventor of carrying out the invention.
Claims 1-21 is rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the enablement requirement. The claim(s) contains subject matter which was not described in the specification in such a way as to enable one skilled in the art to which it pertains, or with which it is most nearly connected, to make and/or use the invention.
Claim 1 recites the claim element “actual/target comparison” is recited 3 times within the specification, namely ¶16, however it is unclear as to what the target is or where this value comes from. The element is a broad generalization term without significant description or supportive detail.
Dependent claims 2-7, 14-15, and 18-21 are likewise rejected.
Claims 20-21 are rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the written description requirement. The claim(s) contains subject matter which was not described in the specification in such a way as to reasonably convey to one skilled in the relevant art that the inventor or a joint inventor, or for applications subject to pre-AIA 35 U.S.C. 112, the inventor(s), at the time the application was filed, had possession of the claimed invention.
Claim 20 recites the claim element “wherein the wireless data transmission takes place as required upon user input or request” however there is no support for this in the specification. Specification ¶28 discloses it is “possible to retrieve the sensor signal as required. This can be done, for example, during a regular component check.” A component check does not inherently teach the use of a user input or request. The broad recitation of checking a component does not include the use or input from a user.
Claim 21 is likewise rejected.
Claim Rejections - 35 USC § 103 The following is a quotation of pre-AIA 35 U.S.C. 103(a) which forms the basis for all obviousness rejections set forth in this Office action: (a) A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. Patentability shall not be negatived by the manner in which the invention was made.
Claims 1-18 are rejected under 35 U.S.C. 103 as being unpatentable over Lettow (US 2019/0266812) in view of Breed et al. (US 2004/0130442).
Regarding claim 1, Lettow discloses a vehicular engine acoustic identification system including method for component monitoring in a vehicle drive train, comprising the following steps (Abstract): a vibration profile of a component in working position or rest position is detected (¶15 and ¶23-26 – AP operational profiles or acoustic pressure profiles for defining mechanical system operational conditions such as velocity/RPM inherently include a working and a rest position of the component operation); a vibration sensor (1) detects the vibration profile of the component as a data information (¶22-26 – program function quantify, analyze, and/or correlate the data from the profiles); the data information of the vibration sensor (1) is detected wirelessly by a receiver (2) (Fig. 1 and ¶12 - computer usable program code may be transmitted using any appropriate medium, including but not limited to wireless); the receiver (2) transmits the data information to a computer (3) and/or a memory device (6) (Fig. 1 and ¶11-12); the computer (3) and/or the memory device (6) carries out an actual/target comparison of the data information (¶25-28 - Program function 112 can quantify, analyze, and/or correlate APMs); the result of the actual/target comparison is evaluated and/or further processed (¶25-28 – results of analysis can be used to generate repair, service, and or operational fitness notifications), Lettow does not explicitly disclose the makeup of the sensor or its wireless data/power transmission however Breed discloses a wireless powerless sensor including wherein the vibration sensor (1) is included in the component, and wherein the receiver (2) is assigned to a second component, wherein the component is arranged so as to rotate and the second component is arranged so as to be stationary (¶382-387 - a single transducer and system for providing power and receiving information located within a few inches of the sensor corresponding to the recited separate sensor and receiver components where Fig. 3 and ¶717 discloses numerous places the sensors can be placed such as tires and steering wheel corresponding to the recited rotating component), and wherein the receiver (2) transmits energy to the vibration sensor (1) (¶382-387 – a single transducer and system for providing power and receiving information), and wherein wireless data transmission between the vibration sensor (1) and the receiver (2) takes place by inductive coupling in LF and HF frequency ranges and by electromagnetic waves in UHF frequency range (¶382-387 - single transducer and system for providing power and receiving information can be obtained instantaneously from the inductive, capacitive or radio frequency source corresponding to the recited inductive and electromagnetic data transmission including inductive system makes use of high frequency (typically 10,000 Hz) corresponding to the recited HF, ¶793 discloses the use of a 40 kHz ultrasonic transducer when used in the single transducer and system for providing power and receiving information can be obtained instantaneously from the inductive, capacitive or radio frequency source includes the corresponding to the recited inductive data transfer at LF and ¶746-748 discloses the use of interrogator broadcast between high GHz to 100 MHz range which includes the corresponding to the recited data transfer at UHF). It would have been obvious to one of ordinary skill in the art before the filing date to have combined vehicular engine acoustic identification system of Lettow with the wireless data/power transmission system of Breed in order to remove a battery or wired power connection to avoid battery exchange maintenance cycles in rotating devices (Breed - ¶69).
Regarding claim 2, Lettow further discloses the vibration sensor (1) generates an electromagnetic field or is a piezo element (¶11 – any computer usable or computer readable medium(s) may be electromagnetic including the detector corresponding to the recited vibration sensor).
Regarding claim 3, Lettow further discloses the data information of the vibration sensor (1) is used for monitoring the component, a component group or a system (¶15 - The nature of acoustic pressure ("AP") can be utilized to determine the operational fitness of mechanical components and/or mechanical systems ("MS")).
Regarding claim 4, Lettow further discloses the transmitted data information is sent based on inductive coupling in the frequency ranges LF, HF or on the basis of electromagnetic wave in the frequency range UHF (¶23 – 40,000 Hz is classified as LF range).
Regarding claim 5, Lettow further discloses the data information is used for evaluating parameter changes of the component (¶25-28 – sudden and/or significant changes are detected).
Regarding claim 6, Lettow further discloses the parameter changes are position, shape, frequency and/or temperature (¶16 and ¶31 – detecting frequencies, operating temperatures or triangulating position of issue).
Regarding claim 7, Lettow further discloses the data information of the vibration sensor (1) is sent to the receiver (2) at intervals or permanently (¶27 – monitoring MS aging over a predetermined period of time corresponding to at least the recited interval monitoring if not permanently).
Regarding claim 8, Lettow further discloses a motor vehicle drive train having a first component, wherein an oscillation sensor (1) for detecting an oscillation profile is included (Abstract, ¶15 and ¶23-26 – AP operational profiles or acoustic pressure profiles for defining mechanical system operational conditions such as velocity/RPM inherently include a working and a rest position of the component operation, oscillation sensor is interpreted as the same as vibration sensor). Lettow does not explicitly disclose the makeup of the sensor or its wireless data/power transmission however Breed further discloses the first component, and a receiver (2) is assigned to a second component, wherein the first component is arranged to rotate relative to the second component(¶382-387 - a single transducer and system for providing power and receiving information located within a few inches of the sensor corresponding to the recited separate sensor and receiver components where Fig. 3 and ¶717 discloses numerous places the sensors can be placed such as tires and steering wheel corresponding to the recited rotating component). It would have been obvious to one of ordinary skill in the art before the filing date to have combined vehicular engine acoustic identification system of Lettow with the wireless data/power transmission system of Breed in order to remove a battery or wired power connection to avoid battery exchange maintenance cycles in rotating devices (Breed - ¶69).
Regarding claim 9, Lettow further discloses the vibration sensor (1) is in wireless operative connection with a receiver (2) (Fig. 1, ¶12 and ¶19 - computer usable program code may be transmitted using any appropriate medium, including but not limited to wireless, where capable of sending data, receiving data, and/or communicating with additional computing devices over network 130 corresponding to the recited operative connection with a receiver).
Regarding claim 10, Lettow further discloses the receiver (2) is operatively connected to a computer (3) and/or a memory device (6) (Fig. 1 and ¶11-12).
Regarding claim 11, Lettow further discloses the vibration sensor (1) is an electromagnetic field sensor or a piezo element (¶11 – any computer usable or computer readable medium(s) may be electromagnetic including the detector corresponding to the recited vibration sensor).
Regarding claim 12, Lettow further discloses the vibration sensor (1) is assigned to the first component and the receiver (2) is assigned to a further component (Fig. 1 and ¶12).
Regarding claim 13, Lettow further discloses the first component is arranged so as to rotate and the second component is arranged so as to be stationary (Fig. 1, ¶17 and ¶41 – MS corresponding to the recited first component where the MS could be IC engines, electrical motors, drivelines, transmissions, brake systems, HVAC systems which all contain rotatable parts and the external components 600 corresponding to the recited second component where it may be a computer display monitor which is stationary).
Regarding claims 14 and 16, Lettow further discloses the sensor (1) is positioned within a matrix of the component (Fig. 4 and ¶32 - multiple copies of detector 105 positioned in a grid corresponding to the recited sensor positioning within a matrix).
Regarding claims 15 and 17, Lettow further discloses the matrix (Fig. 4 and ¶32 - multiple copies of detector 105 positioned in a grid corresponding to the recited sensor positioning within a matrix) but does not disclose the use of a plastic protective material. However Breed further discloses the use of a plastic material (¶178 – grid of insulators corresponding to the recited matrix of plastic where ¶1489 discloses the use of silicone as a protective insulator). It would have been obvious to one of ordinary skill in the art before the filing date to have combined the matrix of Lettow with an organic silicon compound of Breed in order to protect the sensor substrates against mechanical shock and abrupt temperature changes (Breed - ¶1489).
Regarding claim 18, Lettow does not disclose transmitting data in intervals however Breed further discloses wireless data transmission between the vibration sensor (1) and the receiver (2) is carried out at intervals (¶689 – data taken from the tires corresponding to the recited wireless data transmission at different points per revolution or at different time periods corresponding to the recited carried out at intervals).
Claim 19 is rejected under 35 U.S.C. 103 as being unpatentable over Lettow (US 2019/0266812) in view of Breed et al. (US 2004/0130442), as applied to claim 18 above, further in view of Shima et al. (US 2014/0172241).
Regarding claim 19, Lettow does not disclose transmitting data in intervals however Breed further discloses a known system of sending information at different intervals to avoid clashing between signals (¶99) and if there is a SAW sensor within the detection range, it reflects a pulse after a delay time (¶1382) but Breed doesn’t explicitly disclose a staggered collection/processing. However Shima discloses a tire air pressure monitoring device including the wireless data transmission is carried out at the intervals when range of the receiver (2) is exceeded (¶68 and Fig. 10 – transmission delay staggered from data determination/processing corresponding to the recited transmission at different intervals than data input. While Shima does not explicitly disclose the receiver being out of range, the combination of a data processing/transmission delay from the data input with a short range sensor being out of range such as a short range piezoelectric sensor of Breed fully discloses the elements as claimed) It would have been obvious to one of ordinary skill in the art before the filing date to have combined the data processing/transmission delay of Shima with a short range sensor being out of range and the vehicular engine acoustic identification system of Lettow in view of Breed in order to avoid clashing between signals (Breed - ¶99).
Claims 20-21 are rejected under 35 U.S.C. 103 as being unpatentable over Lettow (US 2019/0266812) in view of Breed et al. (US 2004/0130442), as applied to claim 1 above, further in view of Pruett et al. (US 6,490,121).
Regarding claim 20, Lettow further discloses gathering data upon request corresponding to the recited upon user input or request (¶20 - can be an user facing diagnostic tool utilized by one interested in the operational fitness of MSs, such as owners, users, repair technicians, and/or diagnostic experts). Lettow in view of Breed does not disclose transmitting data as required however Pruett discloses a accelerate servo control calculations system including the wireless data transmission takes place as required (Col. 9, lines 32-52 – seek command controls a positional adjustment and data transmission where the command corresponding to the recited as required). It would have been obvious to one of ordinary skill in the art before the filing date to have combined the servo engine positional detection system of Pruett with the vehicular engine acoustic identification system of Lettow in view of Breed in order to gather results when a determination is needed outside the range of the piezo plant (Pruett - Col. 9, lines 32-52).
Regarding claim 21, Lettow in view of Breed does not disclose transmitting data as required however Pruett further discloses when required, the receiver can be brought to a designated position and receive the wireless data transmission from the vibration sensor (1) (Col. 9, lines 32-52 – seek command controls a positional adjustment and data transmission where the command corresponding to the recited receiver can be brought to a designated position). It would have been obvious to one of ordinary skill in the art before the filing date to have combined the servo engine positional detection system of Pruett with the vehicular engine acoustic identification system of Lettow in view of Breed in order to gather results when a determination is needed outside the range of the piezo plant (Pruett - Col. 9, lines 32-52).
Additional References Burns et al. (US 2016/0178464) discloses a gas turbine engine monitoring system including gathering data indicative of a failure mode of the accessory component or a health and life usage parameter of the accessory component by observing the resultant engine or shaft torsional torque response at the rotor natural frequency to indicate torsional excitations close to the natural frequency (¶12 and ¶85).
Conclusion Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the date of this final action. Any inquiry concerning this communication or earlier communications from the examiner should be directed to Matthew J Reda whose telephone number is (408)918-7573. The examiner can normally be reached on Monday - Friday 7-4 ET. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Hunter Lonsberry can be reached on (571) 272-7298. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
/M.J.R./ Examiner, Art Unit 3665
/BEHRANG BADII/ Primary Examiner, Art Unit 3665 | 2022-07-27T22:06:16 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claims 1-21 are pending and examined below. This action is in response to the claims filed 6/27/22. Response to Amendment Applicant’s arguments, see Applicant Remarks first issue, page7, filed on 6/27/22, regarding Objection to the Drawings have been fully considered and are not found persuasive. Figure now has descriptive labels but does not have an associated Figure number.",
"Drawing should be amended to include “Figure 1” on the bottom where it currently only states “Figure”. The objection is maintained. Applicant’s arguments, see Applicant Remarks next issue, page 7, filed on 6/27/22, regarding 35 U.S.C. § 112(a) have been fully considered and are not found persuasive. Applicant’s remarks pointed towards an actual/setpoint comparison as support for an actual/target comparison as claimed. If the target is supposed to be a preestablished setpoint value, then this must be explicitly claimed. As currently written, the actual/target comparison does not have sufficient explanation or support within the specification. The rejection is maintained.",
"Applicant’s arguments, see Applicant Remarks 35 U.S.C. § 112(b), page 8, filed on 6/27/22, regarding 35 U.S.C. § 112(b) have been fully considered and are found persuasive in view of amendments of 6/27/22. 35 U.S.C. § 112(b) rejections are withdrawn. Applicant’s arguments, see Applicant Remarks 35 U.S.C. § 103, page 8-11, filed on 6/27/22, regarding 35 U.S.C. §103 have been fully considered and are not found persuasive. Regarding applicant’s assertion that Lettow in view of Breed differs from the present invention by means of sensing emitted signals vs the component’s own body signals, page 8, a similar argument to that in the Non-Final of 12/27/21 is reiterated. Differentiating features must be explicitly claimed in order to define over the art. Claims as written do not sufficiently make this distinction. Therefore the rejection is maintained. Regarding applicant’s assertion that Breed is silent to the location of the sensor being in a component, page 9, Breed discloses in Figure 3 and ¶717 “several components and several sensors is shown in their approximate locations on a vehicle”. Wheel sensors 14 and 20 are either in or on the wheel, and the fact that the sensors are shown in their approximate location covers all locations within the relative vicinity of the locations in the picture including the corresponding to the recited in the component.",
"Further support within Fig. 38 and ¶965 more explicitly shows a sensor 270 is placed within the tire 266. Therefore the rejection is maintained. Regarding applicant’s discussion on pages 9-11 regarding the distinguishing features of the invention over the prior art, while there may be differences between the invention and the aspects of the references as cited, these distinguishing features must be explicitly claimed. Teachings within the specification and applicant’s remarks section are not sufficient to overcome the rejection of the claims as written over the art of record. The office advises the utilization of interviews in the process of creating the most efficient and constructive examination process in that the interpretations of the examiner and applicant of both the art of record as well as the present application are expressed in a mutual agreement in order to create and push forward the most productive discussions/amendments to move towards allowance. Amendments to claim 20 are addressed below with respect to the art of record.",
"Drawings The drawings are objected to because the figure now has descriptive labels but does not have an associated Figure number. Drawing should be amended to include “Figure 1” on the bottom where it currently only states “Figure”. Corrected drawing sheets in compliance with 37 CFR 1.121(d) are required in reply to the Office action to avoid abandonment of the application. Any amended replacement drawing sheet should include all of the figures appearing on the immediate prior version of the sheet, even if only one figure is being amended. The figure or figure number of an amended drawing should not be labeled as “amended.” If a drawing figure is to be canceled, the appropriate figure must be removed from the replacement sheet, and where necessary, the remaining figures must be renumbered and appropriate changes made to the brief description of the several views of the drawings for consistency. Additional replacement sheets may be necessary to show the renumbering of the remaining figures. Each drawing sheet submitted after the filing date of an application must be labeled in the top margin as either “Replacement Sheet” or “New Sheet” pursuant to 37 CFR 1.121(d). If the changes are not accepted by the examiner, the applicant will be notified and informed of any required corrective action in the next Office action.",
"The objection to the drawings will not be held in abeyance. Claim Rejections - 35 USC § 112 The following is a quotation of the first paragraph of 35 U.S.C. 112(a): (a) IN GENERAL.—The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor or joint inventor of carrying out the invention. Claims 1-21 is rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the enablement requirement. The claim(s) contains subject matter which was not described in the specification in such a way as to enable one skilled in the art to which it pertains, or with which it is most nearly connected, to make and/or use the invention. Claim 1 recites the claim element “actual/target comparison” is recited 3 times within the specification, namely ¶16, however it is unclear as to what the target is or where this value comes from. The element is a broad generalization term without significant description or supportive detail.",
"Dependent claims 2-7, 14-15, and 18-21 are likewise rejected. Claims 20-21 are rejected under 35 U.S.C. 112(a) or 35 U.S.C. 112 (pre-AIA ), first paragraph, as failing to comply with the written description requirement. The claim(s) contains subject matter which was not described in the specification in such a way as to reasonably convey to one skilled in the relevant art that the inventor or a joint inventor, or for applications subject to pre-AIA 35 U.S.C. 112, the inventor(s), at the time the application was filed, had possession of the claimed invention. Claim 20 recites the claim element “wherein the wireless data transmission takes place as required upon user input or request” however there is no support for this in the specification.",
"Specification ¶28 discloses it is “possible to retrieve the sensor signal as required. This can be done, for example, during a regular component check.” A component check does not inherently teach the use of a user input or request. The broad recitation of checking a component does not include the use or input from a user. Claim 21 is likewise rejected. Claim Rejections - 35 USC § 103 The following is a quotation of pre-AIA 35 U.S.C. 103(a) which forms the basis for all obviousness rejections set forth in this Office action: (a) A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. Patentability shall not be negatived by the manner in which the invention was made.",
"Claims 1-18 are rejected under 35 U.S.C. 103 as being unpatentable over Lettow (US 2019/0266812) in view of Breed et al. (US 2004/0130442). Regarding claim 1, Lettow discloses a vehicular engine acoustic identification system including method for component monitoring in a vehicle drive train, comprising the following steps (Abstract): a vibration profile of a component in working position or rest position is detected (¶15 and ¶23-26 – AP operational profiles or acoustic pressure profiles for defining mechanical system operational conditions such as velocity/RPM inherently include a working and a rest position of the component operation); a vibration sensor (1) detects the vibration profile of the component as a data information (¶22-26 – program function quantify, analyze, and/or correlate the data from the profiles); the data information of the vibration sensor (1) is detected wirelessly by a receiver (2) (Fig. 1 and ¶12 - computer usable program code may be transmitted using any appropriate medium, including but not limited to wireless); the receiver (2) transmits the data information to a computer (3) and/or a memory device (6) (Fig.",
"1 and ¶11-12); the computer (3) and/or the memory device (6) carries out an actual/target comparison of the data information (¶25-28 - Program function 112 can quantify, analyze, and/or correlate APMs); the result of the actual/target comparison is evaluated and/or further processed (¶25-28 – results of analysis can be used to generate repair, service, and or operational fitness notifications), Lettow does not explicitly disclose the makeup of the sensor or its wireless data/power transmission however Breed discloses a wireless powerless sensor including wherein the vibration sensor (1) is included in the component, and wherein the receiver (2) is assigned to a second component, wherein the component is arranged so as to rotate and the second component is arranged so as to be stationary (¶382-387 - a single transducer and system for providing power and receiving information located within a few inches of the sensor corresponding to the recited separate sensor and receiver components where Fig. 3 and ¶717 discloses numerous places the sensors can be placed such as tires and steering wheel corresponding to the recited rotating component), and wherein the receiver (2) transmits energy to the vibration sensor (1) (¶382-387 – a single transducer and system for providing power and receiving information), and wherein wireless data transmission between the vibration sensor (1) and the receiver (2) takes place by inductive coupling in LF and HF frequency ranges and by electromagnetic waves in UHF frequency range (¶382-387 - single transducer and system for providing power and receiving information can be obtained instantaneously from the inductive, capacitive or radio frequency source corresponding to the recited inductive and electromagnetic data transmission including inductive system makes use of high frequency (typically 10,000 Hz) corresponding to the recited HF, ¶793 discloses the use of a 40 kHz ultrasonic transducer when used in the single transducer and system for providing power and receiving information can be obtained instantaneously from the inductive, capacitive or radio frequency source includes the corresponding to the recited inductive data transfer at LF and ¶746-748 discloses the use of interrogator broadcast between high GHz to 100 MHz range which includes the corresponding to the recited data transfer at UHF).",
"It would have been obvious to one of ordinary skill in the art before the filing date to have combined vehicular engine acoustic identification system of Lettow with the wireless data/power transmission system of Breed in order to remove a battery or wired power connection to avoid battery exchange maintenance cycles in rotating devices (Breed - ¶69). Regarding claim 2, Lettow further discloses the vibration sensor (1) generates an electromagnetic field or is a piezo element (¶11 – any computer usable or computer readable medium(s) may be electromagnetic including the detector corresponding to the recited vibration sensor). Regarding claim 3, Lettow further discloses the data information of the vibration sensor (1) is used for monitoring the component, a component group or a system (¶15 - The nature of acoustic pressure (\"AP\") can be utilized to determine the operational fitness of mechanical components and/or mechanical systems (\"MS\")). Regarding claim 4, Lettow further discloses the transmitted data information is sent based on inductive coupling in the frequency ranges LF, HF or on the basis of electromagnetic wave in the frequency range UHF (¶23 – 40,000 Hz is classified as LF range).",
"Regarding claim 5, Lettow further discloses the data information is used for evaluating parameter changes of the component (¶25-28 – sudden and/or significant changes are detected). Regarding claim 6, Lettow further discloses the parameter changes are position, shape, frequency and/or temperature (¶16 and ¶31 – detecting frequencies, operating temperatures or triangulating position of issue). Regarding claim 7, Lettow further discloses the data information of the vibration sensor (1) is sent to the receiver (2) at intervals or permanently (¶27 – monitoring MS aging over a predetermined period of time corresponding to at least the recited interval monitoring if not permanently).",
"Regarding claim 8, Lettow further discloses a motor vehicle drive train having a first component, wherein an oscillation sensor (1) for detecting an oscillation profile is included (Abstract, ¶15 and ¶23-26 – AP operational profiles or acoustic pressure profiles for defining mechanical system operational conditions such as velocity/RPM inherently include a working and a rest position of the component operation, oscillation sensor is interpreted as the same as vibration sensor). Lettow does not explicitly disclose the makeup of the sensor or its wireless data/power transmission however Breed further discloses the first component, and a receiver (2) is assigned to a second component, wherein the first component is arranged to rotate relative to the second component(¶382-387 - a single transducer and system for providing power and receiving information located within a few inches of the sensor corresponding to the recited separate sensor and receiver components where Fig. 3 and ¶717 discloses numerous places the sensors can be placed such as tires and steering wheel corresponding to the recited rotating component). It would have been obvious to one of ordinary skill in the art before the filing date to have combined vehicular engine acoustic identification system of Lettow with the wireless data/power transmission system of Breed in order to remove a battery or wired power connection to avoid battery exchange maintenance cycles in rotating devices (Breed - ¶69).",
"Regarding claim 9, Lettow further discloses the vibration sensor (1) is in wireless operative connection with a receiver (2) (Fig. 1, ¶12 and ¶19 - computer usable program code may be transmitted using any appropriate medium, including but not limited to wireless, where capable of sending data, receiving data, and/or communicating with additional computing devices over network 130 corresponding to the recited operative connection with a receiver). Regarding claim 10, Lettow further discloses the receiver (2) is operatively connected to a computer (3) and/or a memory device (6) (Fig. 1 and ¶11-12).",
"Regarding claim 11, Lettow further discloses the vibration sensor (1) is an electromagnetic field sensor or a piezo element (¶11 – any computer usable or computer readable medium(s) may be electromagnetic including the detector corresponding to the recited vibration sensor). Regarding claim 12, Lettow further discloses the vibration sensor (1) is assigned to the first component and the receiver (2) is assigned to a further component (Fig. 1 and ¶12). Regarding claim 13, Lettow further discloses the first component is arranged so as to rotate and the second component is arranged so as to be stationary (Fig.",
"1, ¶17 and ¶41 – MS corresponding to the recited first component where the MS could be IC engines, electrical motors, drivelines, transmissions, brake systems, HVAC systems which all contain rotatable parts and the external components 600 corresponding to the recited second component where it may be a computer display monitor which is stationary). Regarding claims 14 and 16, Lettow further discloses the sensor (1) is positioned within a matrix of the component (Fig. 4 and ¶32 - multiple copies of detector 105 positioned in a grid corresponding to the recited sensor positioning within a matrix). Regarding claims 15 and 17, Lettow further discloses the matrix (Fig. 4 and ¶32 - multiple copies of detector 105 positioned in a grid corresponding to the recited sensor positioning within a matrix) but does not disclose the use of a plastic protective material.",
"However Breed further discloses the use of a plastic material (¶178 – grid of insulators corresponding to the recited matrix of plastic where ¶1489 discloses the use of silicone as a protective insulator). It would have been obvious to one of ordinary skill in the art before the filing date to have combined the matrix of Lettow with an organic silicon compound of Breed in order to protect the sensor substrates against mechanical shock and abrupt temperature changes (Breed - ¶1489). Regarding claim 18, Lettow does not disclose transmitting data in intervals however Breed further discloses wireless data transmission between the vibration sensor (1) and the receiver (2) is carried out at intervals (¶689 – data taken from the tires corresponding to the recited wireless data transmission at different points per revolution or at different time periods corresponding to the recited carried out at intervals). Claim 19 is rejected under 35 U.S.C.",
"103 as being unpatentable over Lettow (US 2019/0266812) in view of Breed et al. (US 2004/0130442), as applied to claim 18 above, further in view of Shima et al. (US 2014/0172241). Regarding claim 19, Lettow does not disclose transmitting data in intervals however Breed further discloses a known system of sending information at different intervals to avoid clashing between signals (¶99) and if there is a SAW sensor within the detection range, it reflects a pulse after a delay time (¶1382) but Breed doesn’t explicitly disclose a staggered collection/processing. However Shima discloses a tire air pressure monitoring device including the wireless data transmission is carried out at the intervals when range of the receiver (2) is exceeded (¶68 and Fig. 10 – transmission delay staggered from data determination/processing corresponding to the recited transmission at different intervals than data input. While Shima does not explicitly disclose the receiver being out of range, the combination of a data processing/transmission delay from the data input with a short range sensor being out of range such as a short range piezoelectric sensor of Breed fully discloses the elements as claimed) It would have been obvious to one of ordinary skill in the art before the filing date to have combined the data processing/transmission delay of Shima with a short range sensor being out of range and the vehicular engine acoustic identification system of Lettow in view of Breed in order to avoid clashing between signals (Breed - ¶99).",
"Claims 20-21 are rejected under 35 U.S.C. 103 as being unpatentable over Lettow (US 2019/0266812) in view of Breed et al. (US 2004/0130442), as applied to claim 1 above, further in view of Pruett et al. (US 6,490,121). Regarding claim 20, Lettow further discloses gathering data upon request corresponding to the recited upon user input or request (¶20 - can be an user facing diagnostic tool utilized by one interested in the operational fitness of MSs, such as owners, users, repair technicians, and/or diagnostic experts). Lettow in view of Breed does not disclose transmitting data as required however Pruett discloses a accelerate servo control calculations system including the wireless data transmission takes place as required (Col. 9, lines 32-52 – seek command controls a positional adjustment and data transmission where the command corresponding to the recited as required). It would have been obvious to one of ordinary skill in the art before the filing date to have combined the servo engine positional detection system of Pruett with the vehicular engine acoustic identification system of Lettow in view of Breed in order to gather results when a determination is needed outside the range of the piezo plant (Pruett - Col. 9, lines 32-52).",
"Regarding claim 21, Lettow in view of Breed does not disclose transmitting data as required however Pruett further discloses when required, the receiver can be brought to a designated position and receive the wireless data transmission from the vibration sensor (1) (Col. 9, lines 32-52 – seek command controls a positional adjustment and data transmission where the command corresponding to the recited receiver can be brought to a designated position). It would have been obvious to one of ordinary skill in the art before the filing date to have combined the servo engine positional detection system of Pruett with the vehicular engine acoustic identification system of Lettow in view of Breed in order to gather results when a determination is needed outside the range of the piezo plant (Pruett - Col. 9, lines 32-52). Additional References Burns et al. (US 2016/0178464) discloses a gas turbine engine monitoring system including gathering data indicative of a failure mode of the accessory component or a health and life usage parameter of the accessory component by observing the resultant engine or shaft torsional torque response at the rotor natural frequency to indicate torsional excitations close to the natural frequency (¶12 and ¶85). Conclusion Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action.",
"Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action.",
"In no event, however, will the statutory period for reply expire later than SIX MONTHS from the date of this final action. Any inquiry concerning this communication or earlier communications from the examiner should be directed to Matthew J Reda whose telephone number is (408)918-7573. The examiner can normally be reached on Monday - Friday 7-4 ET. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Hunter Lonsberry can be reached on (571) 272-7298.",
"The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. /M.J.R./ Examiner, Art Unit 3665 /BEHRANG BADII/ Primary Examiner, Art Unit 3665"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-07-31.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION This is the final office action regarding application number 16/484008, filed on August 06, 2019, which is a 371 of PCT/CN2017/000147, filed on February 09, 2017. Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Response to Amendment The amendment filed on October 26, 2021 has been entered. Claims 1-2, 4-10 remain pending in the application. Applicant’s amendments to the Specification, Drawings, and Claims have overcome most of the objections and 112(b) rejections previously set forth in the Non-Final Office Action mailed on July 26, 2021. Drawings The drawings are objected to because The available drawing at the office shows the following Fig. 1A with part of the drawing missing. The applicant is requested to submit the complete drawing.
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Fig. 1A of the instant application available to the office for examination Corrected drawing sheets in compliance with 37 CFR 1.121(d) are required in reply to the Office action to avoid abandonment of the application. Any amended replacement drawing sheet should include all of the figures appearing on the immediate prior version of the sheet, even if only one figure is being amended. The figure or figure number of an amended drawing should not be labeled as “amended.” If a drawing figure is to be canceled, the appropriate figure must be removed from the replacement sheet, and where necessary, the remaining figures must be renumbered and appropriate changes made to the brief description of the several views of the drawings for consistency. Additional
Claim Interpretation The claimed “light metal” is interpreted as “a metal or alloy of low density (as aluminum, magnesium, titanium and beryllium, and alloys composed predominantly of one or more of these metals)” as defined in Merriam-Webster dictionary. Claim Objections Claim 1 objected to because of the following informalities: Typing error in
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Claim Rejections - 35 USC § 103 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to consider the applicability of 35 U.S.C. 102(b) (2) (C) for any potential 35 U.S.C. 102(a) (2) prior art against the later invention. Claims 1-2, 4-10 are rejected under 35 USC 103 as being unpatentable. Claims 1-2, 4, 6-9 is/are rejected under 35 U.S.C. 103 as being unpatentable over Naito et al., WO 2016043278 (hereafter Naito et al.) and in view of Ogura et al., JP 2012115876 (hereafter Ogura et al.), Nakagawa et al., WO 2015129231A1 (hereafter Nakagawa et al.), Evertsson et al., The thickness of native oxides on aluminum alloys and single crystals, 2015 (hereafter Evertsson) and Capostagno et al., US 20180045232(hereafter Capostagno). Regarding claim 1, Naito et al. teaches a circular shaped laser joint of two metals. Naito et al. teaches
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Fig. 1 of Naito et al. teaches welding joints 10,20,30 between two overlapping metals “A method of laser welding together two or more light metal workpieces, the method comprising: “directing a laser beam at a top surface of a workpiece stack-up that comprises two or more overlapping light metal workpieces,” (Fig. 1 teaches laser welding method to form multiple beads on top surface of workpiece 5) “the workpiece stack-up comprising at least a first light metal workpiece and a second light metal workpiece that overlap within a welding region,” (Fig. 1 and Page 11, paragraph 5 teaches laser welding joint of a stack-up of aluminum alloy) “the first light metal workpiece providing the top surface of the workpiece stack-up and the second light metal workpiece providing a bottom surface of the workpiece stack-up,” (Fig. 1 and Page 11, paragraph 5 teaches laser welding joint of a stack-up of aluminum alloy) “and wherein each pair of adjacent overlapping light metal workpieces within the workpiece stack-up establishes a faying interface there between,” (annotated Fig. 1) “the laser weld joint fusion welding the two or more overlapping light metal workpieces together within the welding region.” (Page 3, paragraph 3 teaches fusion line formed on the welding joint through laser welding)
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Annotated Figure 10 of Nakagawa et al. “at a beam travel speed of 8 m/min or greater to grow and develop a melt puddle that extends inwards and downwards from the closed-curved weld path on the top surface of the workpiece stack-up,” (Naito et al. teaches welding speed as a result effective variable in page 2, paragraph 4 “thermal deformation can be reduced by appropriately setting welding conditions such as welding speed”. However, modified Naito does not teach a welding speed of 8 m/min or greater. Nakagawa et al. teaches a two-step laser welding method to join multiple metal plates through multiple scanning of a spiral path. Nakagawa et al. teaches in Fig. 10 a melt puddle 22 extending inwards and downwards from the top “the melt puddle penetrating the workpiece stack-up from the top surface of the workpiece stack-up towards the bottom surface and intersecting each faying interface established within the welding region of the workpiece stack-up” (melt puddle 22 in annotated Fig. 10 of Nakagawa) “and allowing the melt puddle to solidify into a laser weld joint comprised of resolidified composite workpiece material,” ( resolidified region 29 in annotated Fig. 10 of Nakagawa) It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito to set the laser speed to 8m/min or greater as taught by Nakagawa et al. One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be “advancing a beam spot of the laser beam relative to the top surface of the workpiece stack-up such that the beam spot is advanced multiple times along a closed-curved weld path” (The combination of Naito and Nakagawa teaches each claimed limitation, as detailed above, but does not teach multiple scans to create melt pool. Ogura et al. teaches a laser welding method to join multiple metal plates with repeated scans along a closed path. Ogura et al. teaches repeated scanning of the closed curved path 11L by laser 11, 12, 13 in Fig. 3.
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Fig. 3 of Ogura et al. teaches scan 1,2, and 3 repeated over the same circular path 11L It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito et al. to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al. in page 7, paragraph 2.) “at least one of the first light metal workpiece and the second light metal workpiece comprising s a coating comprising an oxide;” (Naito teaches aluminum alloy as light metal workpiece in Page 11, paragraph 5. Naito does not explicitly teach an oxide coating on Aluminum alloy. Evertsson teaches the oxidation properties of Aluminum and its alloys. Evertsson teaches in Introduction “the amorphous native aluminum oxide film which is formed spontaneously at ambient pressures and at low temperatures dictates the properties of functional aluminum.” Hence it is implied that aluminum or aluminum alloy of Naito has a native oxide layer. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to design the aluminum “the advancing causing fragmenting of the coating to create oxide coating fragments; forming a conglomeration on the top surface, the conglomeration comprising the oxide coating fragments;” (The combination of Naito, Nakagawa, Ogura, and Evertsson teaches each claimed limitation, as detailed above, but does not teach conglomeration of coating fragments on the weld top surface. Capostagno teaches a method to form a weld been multiple metallic materials in a welding pattern. Capostagno further teaches aluminum as the metallic material in paragraph [2]. Additionally, Capostagno teaches an anodized coating on the material before welding in paragraphs [187] and [196]. Fig. 21, and 31 of Capostagno teaches conglomeration 132 on top surface of the weld 8 and 310 respectively. Paragraph [110] teaches “Vapour pressure caused by the rapid heating of the first material 1 causes at least some of the first material 1 to be injected into the hole 71 or ejected from the hole 71. This is shown by the material 131 being injected into the key hole 133 formed in the second material 2, and the material 132 being emitted out of the hole 71. The materials 131 and 132 may be in the vapour phase, fluid phase, solid phase, or a It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method in in Naito so that the coating oxides would conglomerate at the top surface of weld as taught in Capostagno. One of ordinary skill in the art would have been motivated to do so to improve shear resistance and ohmic resistance of the weld as taught in paragraph [204] in Capostagno. Additionally, the limitation recites the effects of advancing the laser spot multiple times along a closed curve path. The conglomeration of oxide is a result of the advancing step. MPEP 2112.01-I states "Where the claimed and prior art products are identical or substantially identical in structure or composition, or are produced by identical or substantially identical processes, a prima facie case of either anticipation or obviousness has been established. In re Best, 562 F.2d 1252, 1255, 195 USPQ 430, 433 (CCPA 1977). In
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Fig. 13 of Capostagno teaches metal and metal oxide getting fragmented during welding
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Fig. 31 of Capostagno teaches metal and metal oxide conglomerate on top weld surface Regarding claim 2, “The method set forth in claim 1, wherein the first light metal workpiece has an exterior outer surface and a first faying surface, and the second light metal workpiece has an exterior outer surface and a second faying surface, the exterior outer surface of the first light metal workpiece providing the top surface of the workpiece stack-up and the exterior outer surface of the second light metal workpiece providing the bottom surface of the workpiece stack-up, and wherein the first and second faying surfaces of the first and second light metal workpieces overlap and confront to establish a faying interface.” (Annotated Fig. 1 of Naito et al.) Regarding claim 4, “The method set forth in claim 1, wherein each of the two or more overlapping light metal workpieces is an aluminum workpiece.” (Naito et al. teaches the metal workpieces can be aluminum alloy in page 11, paragraph 4.) Regarding claim 6, “The method set forth in claim 1, wherein the closed-curve weld path is a circle weld path.” (Fig. 1 of Naito et al.) Regarding claim 7, “The method set forth in claim 6, wherein the circle weld path has a diameter that ranges from 4 mm to 12 mm.” (Naito et al. teaches “The first weld bead 10 is formed, for example, with an outer diameter of 3 mm or more and 15 mm or less” in page 5, paragraph 6. Hence the claimed range lies inside the ranges taught in prior art and a prima facie case of obviousness exists. MPEP 2144.05-I.) Regarding claim 8, “The method set forth in claim 1, wherein the beam spot of the laser beam is advanced completely along the closed-curve weld path anywhere from four times to eighty times.” (Naito et al. does not explicitly teach iteration of the beam. Ogura et al. teaches in Fig. 2 and 3 iteration of the laser beam along the same radius R1 three times which is close to the claimed range of 4 to 80. Moreover, Ogura et al. teaches multiple pattern and iterations of laser path to join two metal work pieces without defect in Fig. 5, 7 to 10. Thus iteration of laser beam along the same weld area is established as a result effective variable. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito et al. to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al. in page 7, paragraph 2. Additionally, the range claimed in instant claim is close to the range established in prior art and hence is obvious. MPEP 2144.05-I.) Regarding claim 9, The method set forth in claim 8, wherein the laser beam is advanced along the closed-curve weld path at a beam travel speed that ranges from 10 m/min to 50 m/min. (Naito et al. teaches the moving speed of a laser beam needs to be adjusted to achieve good welding in page 10, paragraph 4. Naito et al. also teaches a speed of 4m/min in page 12, paragraph 5. However, Naito et al. does not explicitly teach a speed from 10m/min to 50m/min. Nakagawa teaches in Page 16, paragraph 5-6 of attached machine translation a scanning speed of 10 m/min or 8.7 m/min to achieve melt puddle based on plate material, plate thickness, radius of processing region, and laser beam output. Thus scanning speed is established as result effective variable in the art. Moreover, since the claimed range of 10 m/min to 50 m/min overlaps with the range 10 m/min disclosed in the prior art a prima facie case of obviousness exists. MPEP 2144.05-I. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito to set the laser speed to 10m/min or greater as taught by Nakagawa et al. One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be realized,” as taught by Nakagawa et al. in page 18, paragraph 2 of the attached machine translation.) Claim 5 is/are rejected under 35 U.S.C. 103 as being unpatentable over Naito, Ogura et al., Nakagawa et al., Evertsson, and Capostagno as applied to claim 1 above, and further in view of Wang, US 20060175315(hereafter Wang) . “The method set forth in claim 1, wherein each of the two or more overlapping light metal workpieces is a magnesium workpiece.” (The primary combination of references in claim 1 does not explicitly teach Magnesium workpieces. Wang teaches a fusion welding system to join a set of overlapping workpieces. Wang teaches workpieces can be formed of magnesium alloys in paragraph [18]. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to apply the welding method of modified Naito et al. to magnesium workpieces as taught by Wang. One of ordinary skill in the art would have been motivated to do so “to weld a greater plurality or structural components having variable thickness” as taught by Wang in paragraph [18]. ) Claim 10 is/are rejected under 35 U.S.C. 103 as being unpatentable over Naito et al., Ogura et al., Nakagawa et al., Evertsson, and Capostagno as applied to claim 1 above, and further in view of P. Kah, J. Lu, J. Martikainen and R. Suoranta, "Remote Laser Welding with High Power Fiber Lasers," Engineering, Vol. 5 No. 9, 2013, pp. 700-706. doi: 10.4236/eng.2013.59083, (hereafter Kah et al.). “The method set forth in claim 1, wherein the laser beam is a solid-state laser beam, and wherein advancing the laser beam multiple times along the closed-curved weld path is performed by a remote laser welding apparatus.” (The primary combination of references in claim 1 does not explicitly teach a solid-state laser. Kah et al. teaches remote laser welding systems with Nd:YAG laser, fiber laser, or disk laser in Introduction. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the laser system of modified Naito et al. to a remote laser welding apparatus with fiber laser as taught in Kah et al. One of ordinary skill in the art would have been motivated to do so because it “offers increased flexibility, high operational speed, and reduced cycle time to process a wide range of workpieces” as taught by Kah et al. in abstract.) Double Patenting The nonstatutory double patenting rejection is based on a judicially created doctrine grounded in public policy (a policy reflected in the statute) so as to prevent the unjustified or improper timewise extension of the “right to exclude” In re Berg, 140 F.3d 1428, 46 USPQ2d 1226 (Fed. Cir. 1998); In re Goodman, 11 F.3d 1046, 29 USPQ2d 2010 (Fed. Cir. 1993); In re Longi, 759 F.2d 887, 225 USPQ 645 (Fed. Cir. 1985); In re Van Ornum, 686 F.2d 937, 214 USPQ 761 (CCPA 1982); In re Vogel, 422 F.2d 438, 164 USPQ 619 (CCPA 1970); In re Thorington, 418 F.2d 528, 163 USPQ 644 (CCPA 1969). A timely filed terminal disclaimer in compliance with 37 CFR 1.321(c) or 1.321(d) may be used to overcome an actual or provisional rejection based on nonstatutory double patenting provided the reference application or patent either is shown to be commonly owned with the examined application, or claims an invention made as a result of activities undertaken within the scope of a joint research agreement. See MPEP § 717.02 for applications subject to examination under the first inventor to file provisions of the AIA as explained in MPEP § 2159. See MPEP § 2146 et seq. for applications not subject to examination under the The USPTO Internet website contains terminal disclaimer forms which may be used. Please visit www.uspto.gov/patent/patents-forms. The filing date of the application in which the form is filed determines what form (e.g., PTO/SB/25, PTO/SB/26, PTO/AIA /25, or PTO/AIA /26) should be used. A web-based eTerminal Disclaimer may be filled out completely online using web-screens. An eTerminal Disclaimer that meets all requirements is auto-processed and approved immediately upon submission. For more information about eTerminal Disclaimers, refer to www.uspto.gov/patents/process/file/efs/guidance/eTD-info-I.jsp. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/614561 (hereafter '561) in view of Ogura and Nakagawa. ‘561 teaches the elements of claim 1 of instant application. However, ‘561 does not explicitly teach coating the materials with oxide or a beam speed of 8 m/min or greater. Evertsson teaches that aluminum or aluminum alloys have a native oxide coating on the surface as discussed in claim 1. Hence it is implied in ‘561 that aluminum workpieces would have native oxide coating in them. Nakagawa teaches a travel speed of 10 m/min in page 16 as discussed above in claim 1 which overlaps with the claimed range of 8 m/min or greater. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘561 to add a traveling speed of 10m/min as taught in Nakagawa. One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be realized,” as taught by Nakagawa et al. in page 18, paragraph 2 of the attached machine translation. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/336333 (hereafter '333) in view of Ogura and Nakagawa. ‘333 teaches the elements of claim 1 of instant application. However, ‘333 does not teach “the beam spot is advanced multiple times”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3 as discussed above. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘333 to add multiple scanning of the welded region to This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/499605 (hereafter '605) in view of Ogura. ‘605 teaches the elements of claim 1 of instant application. However, ‘605 does not teach “the beam spot is advanced multiple times along a closed-curved weld path”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘605 to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al. in page 7, paragraph 2. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/484010 (hereafter '010) in view of Ogura. ‘010 teaches the elements of claim 1 of instant application. However, ‘010 does not teach “the beam spot is advanced multiple times along a closed-curved weld path”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘010 to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al. in page 7, paragraph 2. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/097689 (hereafter '689) in view of Capostagno. ‘689 teaches the elements of claim 1 of instant application. However, ‘689 does not teach oxide coating of materials. Capostagno teaches coating materials with anodization This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of U.S. patent 10946479(hereafter ‘479) Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-15 of US Patent 10953497(hereafter ‘497) in view of Nakagawa and Capostagno. ‘497 teaches the elements of claim 1 of instant application. However, ‘497 does not teach “a beam travel speed of 8 m/min or greater” and oxide coating. Nakagawa teaches a travel speed of 10 m/min in page 16 as discussed above. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘497 to add a traveling speed of 10m/min as taught in Nakagawa. One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be realized,” as taught by Nakagawa et al. in page 18, paragraph 2 of the attached machine translation. Capostagno teaches coating materials with anodization in Fig. 25. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the coating in ‘689 so that the coating oxides would conglomerate at the top surface of weld as taught in Capostagno. One of ordinary skill in the art would have been motivated to do so to improve shear resistance and ohmic resistance of the weld as taught in paragraph [204] in Capostagno. Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-18 of U.S. patent 10953494(hereafter ‘494) in view of Ogura. ‘494 teaches the elements of claim 1 of instant application. However, ‘494 does not teach “the beam spot is advanced multiple times along a closed-curved weld path”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘494 to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al. in page 7, paragraph 2. Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of U.S. Patent No. 10675713(hereafter ‘713) in view of Nakagawa. ‘713 teaches the elements of claim 1 of instant application. However, ‘713 does not teach “a beam travel speed of 8 m/min or greater”. Nakagawa teaches a travel speed of 10 m/min in page 16 as discussed above. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘713 to add a traveling speed of 8m/min or greater as taught in Nakagawa. One of ordinary . Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of U.S. Patent No. 10195689(hereafter ‘689). Although the claims at issue are not identical, they are not patentably distinct from each other because instant claim 1 is met by claims 1-20 of ‘689.
Response to Arguments Applicant’s arguments filed on October 26, 2021 with respect to claim(s) 1-2, and 4-10 have been considered but are moot because the new ground of rejection based on the amendment of claims. The applicant argues on Page 11 that Fig. 1A shows element 44. However, the available drawing to the office shows the following Fig. 1A with part of the drawing missing. The applicant is requested to submit the complete drawing.
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The applicant amended claim 1 to include the following limitations and argued that this makes the method distinguishable over Naito, Ogura, and Nakagawa on pages 12-16.
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However, upon further consideration, a new ground(s) of rejection is made in view of Naito, Ogura, Nakagawa, Evertsson, and Capostagno as discussed below. “at least one of the first light metal workpiece and the second light metal workpiece comprising s a coating comprising an oxide;” (Naito teaches aluminum alloy as light metal workpiece in Page 11, paragraph 5. Naito does not explicitly teach an oxide coating on Aluminum alloy. Evertsson teaches the oxidation properties of Aluminum and its alloys. Evertsson teaches in Introduction “the amorphous native aluminum oxide film which is formed spontaneously at ambient pressures and at low temperatures dictates the properties of functional aluminum.” Hence it is implied that aluminum or aluminum alloy of Naito has a native oxide layer. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to design the aluminum workpieces in Naito et al. with oxide coating as taught in Evertsson. One of ordinary skill in the art would have been motivated to do so in order to reduce corrosion as taught in Introduction section in Evertsson.) “the advancing causing fragmenting of the coating to create oxide coating fragments; forming a conglomeration on the top surface, the conglomeration comprising the oxide coating fragments;” Capostagno teaches a method to form a weld been multiple metallic materials in a welding pattern. Capostagno further teaches aluminum as the metallic material in paragraph [2]. Additionally, Capostagno teaches an anodized coating on the material before welding in paragraphs [187] and [196]. Fig. 21, and 31 of Capostagno teaches conglomeration 132 on top surface of the weld 8 and 310 respectively. Paragraph [110] teaches “Vapour pressure caused by the rapid heating of the first material 1 causes at least some of the first material 1 to be injected into the hole 71 or ejected from the hole 71. This is shown by the material 131 being injected into the key hole 133 formed in the second material 2, and the material 132 being emitted out of the hole 71. The materials 131 and 132 may be in the vapour phase, fluid phase, solid phase, or a combination of at least two of the forgoing material phases. Molten second material 81 can then flow into the hole 71 as shown with reference to FIG 14.” Even though Capostagno does not explicitly teach that 132 comprises fragment of coating oxide, it is implicit that rapid heating and laser beam would have to cause fragmentation of the top coating layer of material 1 to make hole 71 as well as 133 and part of the fragments would be present in 132 that eventually conglomerates on top surface of weld. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method in in Naito so that the coating oxides would conglomerate at the top surface of weld as taught in Capostagno. One of ordinary skill in the art would have been motivated to do so to improve shear resistance and ohmic resistance of the weld as taught in paragraph [204] in Capostagno. Additionally, the limitation recites the effects of advancing the laser spot multiple times along a closed curve path. The conglomeration of oxide is a result of the advancing step. MPEP 2112.01-I states "Where the claimed and prior art products are identical or substantially identical in structure or composition, or are produced by identical or substantially identical processes, a prima facie case of either anticipation or obviousness has been established. In re Best, 562 F.2d 1252, 1255, 195 USPQ 430, 433 (CCPA 1977). In this case, the advancing step is taught in prior art and hence obviousness of oxide fragmentation and conglomeration is established.)
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Fig. 13 of Capostagno teaches metal and metal oxide getting fragmented during welding
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Fig. 31 of Capostagno teaches metal and metal oxide conglomerate on top weld surface Conclusion Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is Any inquiry concerning this communication or earlier communications from the examiner should be directed to FAHMIDA FERDOUSI whose telephone number is (303)297-4341. The examiner can normally be reached on Monday-Friday; 9:00AM-3:00PM; PST. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Ibrahime Abraham can be reached on (571) 270-5569. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.
/FAHMIDA FERDOUSI/Examiner, Art Unit 3761
/JUSTIN C DODSON/Primary Examiner, Art Unit 3761 | 2021-11-27T07:34:23 | [
"DETAILED ACTION This is the final office action regarding application number 16/484008, filed on August 06, 2019, which is a 371 of PCT/CN2017/000147, filed on February 09, 2017. Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Response to Amendment The amendment filed on October 26, 2021 has been entered. Claims 1-2, 4-10 remain pending in the application. Applicant’s amendments to the Specification, Drawings, and Claims have overcome most of the objections and 112(b) rejections previously set forth in the Non-Final Office Action mailed on July 26, 2021. Drawings The drawings are objected to because The available drawing at the office shows the following Fig. 1A with part of the drawing missing. The applicant is requested to submit the complete drawing. PNG media_image1.png 325 385 media_image1.png Greyscale Fig. 1A of the instant application available to the office for examination Corrected drawing sheets in compliance with 37 CFR 1.121(d) are required in reply to the Office action to avoid abandonment of the application.",
"Any amended replacement drawing sheet should include all of the figures appearing on the immediate prior version of the sheet, even if only one figure is being amended. The figure or figure number of an amended drawing should not be labeled as “amended.” If a drawing figure is to be canceled, the appropriate figure must be removed from the replacement sheet, and where necessary, the remaining figures must be renumbered and appropriate changes made to the brief description of the several views of the drawings for consistency. Additional Claim Interpretation The claimed “light metal” is interpreted as “a metal or alloy of low density (as aluminum, magnesium, titanium and beryllium, and alloys composed predominantly of one or more of these metals)” as defined in Merriam-Webster dictionary. Claim Objections Claim 1 objected to because of the following informalities: Typing error in PNG media_image2.png 46 431 media_image2.png Greyscale Appropriate correction is required.",
"Claim Rejections - 35 USC § 103 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains.",
"Patentability shall not be negated by the manner in which the invention was made. The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to consider the applicability of 35 U.S.C.",
"102(b) (2) (C) for any potential 35 U.S.C. 102(a) (2) prior art against the later invention. Claims 1-2, 4-10 are rejected under 35 USC 103 as being unpatentable. Claims 1-2, 4, 6-9 is/are rejected under 35 U.S.C. 103 as being unpatentable over Naito et al., WO 2016043278 (hereafter Naito et al.) and in view of Ogura et al., JP 2012115876 (hereafter Ogura et al. ), Nakagawa et al., WO 2015129231A1 (hereafter Nakagawa et al. ), Evertsson et al., The thickness of native oxides on aluminum alloys and single crystals, 2015 (hereafter Evertsson) and Capostagno et al., US 20180045232(hereafter Capostagno). Regarding claim 1, Naito et al. teaches a circular shaped laser joint of two metals. Naito et al.",
"teaches PNG media_image3.png 645 637 media_image3.png Greyscale Fig. 1 of Naito et al. teaches welding joints 10,20,30 between two overlapping metals “A method of laser welding together two or more light metal workpieces, the method comprising: “directing a laser beam at a top surface of a workpiece stack-up that comprises two or more overlapping light metal workpieces,” (Fig. 1 teaches laser welding method to form multiple beads on top surface of workpiece 5) “the workpiece stack-up comprising at least a first light metal workpiece and a second light metal workpiece that overlap within a welding region,” (Fig.",
"1 and Page 11, paragraph 5 teaches laser welding joint of a stack-up of aluminum alloy) “the first light metal workpiece providing the top surface of the workpiece stack-up and the second light metal workpiece providing a bottom surface of the workpiece stack-up,” (Fig. 1 and Page 11, paragraph 5 teaches laser welding joint of a stack-up of aluminum alloy) “and wherein each pair of adjacent overlapping light metal workpieces within the workpiece stack-up establishes a faying interface there between,” (annotated Fig. 1) “the laser weld joint fusion welding the two or more overlapping light metal workpieces together within the welding region.” (Page 3, paragraph 3 teaches fusion line formed on the welding joint through laser welding) PNG media_image4.png 449 748 media_image4.png Greyscale Annotated Figure 10 of Nakagawa et al.",
"“at a beam travel speed of 8 m/min or greater to grow and develop a melt puddle that extends inwards and downwards from the closed-curved weld path on the top surface of the workpiece stack-up,” (Naito et al. teaches welding speed as a result effective variable in page 2, paragraph 4 “thermal deformation can be reduced by appropriately setting welding conditions such as welding speed”. However, modified Naito does not teach a welding speed of 8 m/min or greater. Nakagawa et al. teaches a two-step laser welding method to join multiple metal plates through multiple scanning of a spiral path. Nakagawa et al. teaches in Fig. 10 a melt puddle 22 extending inwards and downwards from the top “the melt puddle penetrating the workpiece stack-up from the top surface of the workpiece stack-up towards the bottom surface and intersecting each faying interface established within the welding region of the workpiece stack-up” (melt puddle 22 in annotated Fig. 10 of Nakagawa) “and allowing the melt puddle to solidify into a laser weld joint comprised of resolidified composite workpiece material,” ( resolidified region 29 in annotated Fig.",
"10 of Nakagawa) It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito to set the laser speed to 8m/min or greater as taught by Nakagawa et al. One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be “advancing a beam spot of the laser beam relative to the top surface of the workpiece stack-up such that the beam spot is advanced multiple times along a closed-curved weld path” (The combination of Naito and Nakagawa teaches each claimed limitation, as detailed above, but does not teach multiple scans to create melt pool. Ogura et al. teaches a laser welding method to join multiple metal plates with repeated scans along a closed path. Ogura et al.",
"teaches repeated scanning of the closed curved path 11L by laser 11, 12, 13 in Fig. 3. PNG media_image5.png 460 731 media_image5.png Greyscale Fig. 3 of Ogura et al. teaches scan 1,2, and 3 repeated over the same circular path 11L It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito et al. to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al.",
"in page 7, paragraph 2.) “at least one of the first light metal workpiece and the second light metal workpiece comprising s a coating comprising an oxide;” (Naito teaches aluminum alloy as light metal workpiece in Page 11, paragraph 5. Naito does not explicitly teach an oxide coating on Aluminum alloy. Evertsson teaches the oxidation properties of Aluminum and its alloys. Evertsson teaches in Introduction “the amorphous native aluminum oxide film which is formed spontaneously at ambient pressures and at low temperatures dictates the properties of functional aluminum.” Hence it is implied that aluminum or aluminum alloy of Naito has a native oxide layer. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to design the aluminum “the advancing causing fragmenting of the coating to create oxide coating fragments; forming a conglomeration on the top surface, the conglomeration comprising the oxide coating fragments;” (The combination of Naito, Nakagawa, Ogura, and Evertsson teaches each claimed limitation, as detailed above, but does not teach conglomeration of coating fragments on the weld top surface. Capostagno teaches a method to form a weld been multiple metallic materials in a welding pattern.",
"Capostagno further teaches aluminum as the metallic material in paragraph [2]. Additionally, Capostagno teaches an anodized coating on the material before welding in paragraphs [187] and [196]. Fig. 21, and 31 of Capostagno teaches conglomeration 132 on top surface of the weld 8 and 310 respectively. Paragraph [110] teaches “Vapour pressure caused by the rapid heating of the first material 1 causes at least some of the first material 1 to be injected into the hole 71 or ejected from the hole 71. This is shown by the material 131 being injected into the key hole 133 formed in the second material 2, and the material 132 being emitted out of the hole 71. The materials 131 and 132 may be in the vapour phase, fluid phase, solid phase, or a It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method in in Naito so that the coating oxides would conglomerate at the top surface of weld as taught in Capostagno. One of ordinary skill in the art would have been motivated to do so to improve shear resistance and ohmic resistance of the weld as taught in paragraph [204] in Capostagno.",
"Additionally, the limitation recites the effects of advancing the laser spot multiple times along a closed curve path. The conglomeration of oxide is a result of the advancing step. MPEP 2112.01-I states \"Where the claimed and prior art products are identical or substantially identical in structure or composition, or are produced by identical or substantially identical processes, a prima facie case of either anticipation or obviousness has been established. In re Best, 562 F.2d 1252, 1255, 195 USPQ 430, 433 (CCPA 1977). In PNG media_image6.png 616 641 media_image6.png Greyscale Fig. 13 of Capostagno teaches metal and metal oxide getting fragmented during welding PNG media_image7.png 644 951 media_image7.png Greyscale Fig. 31 of Capostagno teaches metal and metal oxide conglomerate on top weld surface Regarding claim 2, “The method set forth in claim 1, wherein the first light metal workpiece has an exterior outer surface and a first faying surface, and the second light metal workpiece has an exterior outer surface and a second faying surface, the exterior outer surface of the first light metal workpiece providing the top surface of the workpiece stack-up and the exterior outer surface of the second light metal workpiece providing the bottom surface of the workpiece stack-up, and wherein the first and second faying surfaces of the first and second light metal workpieces overlap and confront to establish a faying interface.” (Annotated Fig.",
"1 of Naito et al.) Regarding claim 4, “The method set forth in claim 1, wherein each of the two or more overlapping light metal workpieces is an aluminum workpiece.” (Naito et al. teaches the metal workpieces can be aluminum alloy in page 11, paragraph 4.) Regarding claim 6, “The method set forth in claim 1, wherein the closed-curve weld path is a circle weld path.” (Fig. 1 of Naito et al.) Regarding claim 7, “The method set forth in claim 6, wherein the circle weld path has a diameter that ranges from 4 mm to 12 mm.” (Naito et al. teaches “The first weld bead 10 is formed, for example, with an outer diameter of 3 mm or more and 15 mm or less” in page 5, paragraph 6. Hence the claimed range lies inside the ranges taught in prior art and a prima facie case of obviousness exists. MPEP 2144.05-I.) Regarding claim 8, “The method set forth in claim 1, wherein the beam spot of the laser beam is advanced completely along the closed-curve weld path anywhere from four times to eighty times.” (Naito et al. does not explicitly teach iteration of the beam. Ogura et al. teaches in Fig.",
"2 and 3 iteration of the laser beam along the same radius R1 three times which is close to the claimed range of 4 to 80. Moreover, Ogura et al. teaches multiple pattern and iterations of laser path to join two metal work pieces without defect in Fig. 5, 7 to 10. Thus iteration of laser beam along the same weld area is established as a result effective variable. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito et al. to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al.",
"in page 7, paragraph 2. Additionally, the range claimed in instant claim is close to the range established in prior art and hence is obvious. MPEP 2144.05-I.) Regarding claim 9, The method set forth in claim 8, wherein the laser beam is advanced along the closed-curve weld path at a beam travel speed that ranges from 10 m/min to 50 m/min. (Naito et al. teaches the moving speed of a laser beam needs to be adjusted to achieve good welding in page 10, paragraph 4. Naito et al. also teaches a speed of 4m/min in page 12, paragraph 5. However, Naito et al.",
"does not explicitly teach a speed from 10m/min to 50m/min. Nakagawa teaches in Page 16, paragraph 5-6 of attached machine translation a scanning speed of 10 m/min or 8.7 m/min to achieve melt puddle based on plate material, plate thickness, radius of processing region, and laser beam output. Thus scanning speed is established as result effective variable in the art. Moreover, since the claimed range of 10 m/min to 50 m/min overlaps with the range 10 m/min disclosed in the prior art a prima facie case of obviousness exists.",
"MPEP 2144.05-I. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of Naito to set the laser speed to 10m/min or greater as taught by Nakagawa et al. One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be realized,” as taught by Nakagawa et al. in page 18, paragraph 2 of the attached machine translation.) Claim 5 is/are rejected under 35 U.S.C. 103 as being unpatentable over Naito, Ogura et al., Nakagawa et al., Evertsson, and Capostagno as applied to claim 1 above, and further in view of Wang, US 20060175315(hereafter Wang) .",
"“The method set forth in claim 1, wherein each of the two or more overlapping light metal workpieces is a magnesium workpiece.” (The primary combination of references in claim 1 does not explicitly teach Magnesium workpieces. Wang teaches a fusion welding system to join a set of overlapping workpieces. Wang teaches workpieces can be formed of magnesium alloys in paragraph [18]. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to apply the welding method of modified Naito et al. to magnesium workpieces as taught by Wang. One of ordinary skill in the art would have been motivated to do so “to weld a greater plurality or structural components having variable thickness” as taught by Wang in paragraph [18]. )",
"Claim 10 is/are rejected under 35 U.S.C. 103 as being unpatentable over Naito et al., Ogura et al., Nakagawa et al., Evertsson, and Capostagno as applied to claim 1 above, and further in view of P. Kah, J. Lu, J. Martikainen and R. Suoranta, \"Remote Laser Welding with High Power Fiber Lasers,\" Engineering, Vol. 5 No. 9, 2013, pp. 700-706. doi: 10.4236/eng.2013.59083, (hereafter Kah et al.). “The method set forth in claim 1, wherein the laser beam is a solid-state laser beam, and wherein advancing the laser beam multiple times along the closed-curved weld path is performed by a remote laser welding apparatus.” (The primary combination of references in claim 1 does not explicitly teach a solid-state laser. Kah et al. teaches remote laser welding systems with Nd:YAG laser, fiber laser, or disk laser in Introduction.",
"It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the laser system of modified Naito et al. to a remote laser welding apparatus with fiber laser as taught in Kah et al. One of ordinary skill in the art would have been motivated to do so because it “offers increased flexibility, high operational speed, and reduced cycle time to process a wide range of workpieces” as taught by Kah et al. in abstract.) Double Patenting The nonstatutory double patenting rejection is based on a judicially created doctrine grounded in public policy (a policy reflected in the statute) so as to prevent the unjustified or improper timewise extension of the “right to exclude” In re Berg, 140 F.3d 1428, 46 USPQ2d 1226 (Fed.",
"Cir. 1998); In re Goodman, 11 F.3d 1046, 29 USPQ2d 2010 (Fed. Cir. 1993); In re Longi, 759 F.2d 887, 225 USPQ 645 (Fed. Cir. 1985); In re Van Ornum, 686 F.2d 937, 214 USPQ 761 (CCPA 1982); In re Vogel, 422 F.2d 438, 164 USPQ 619 (CCPA 1970); In re Thorington, 418 F.2d 528, 163 USPQ 644 (CCPA 1969). A timely filed terminal disclaimer in compliance with 37 CFR 1.321(c) or 1.321(d) may be used to overcome an actual or provisional rejection based on nonstatutory double patenting provided the reference application or patent either is shown to be commonly owned with the examined application, or claims an invention made as a result of activities undertaken within the scope of a joint research agreement. See MPEP § 717.02 for applications subject to examination under the first inventor to file provisions of the AIA as explained in MPEP § 2159.",
"See MPEP § 2146 et seq. for applications not subject to examination under the The USPTO Internet website contains terminal disclaimer forms which may be used. Please visit www.uspto.gov/patent/patents-forms. The filing date of the application in which the form is filed determines what form (e.g., PTO/SB/25, PTO/SB/26, PTO/AIA /25, or PTO/AIA /26) should be used. A web-based eTerminal Disclaimer may be filled out completely online using web-screens. An eTerminal Disclaimer that meets all requirements is auto-processed and approved immediately upon submission. For more information about eTerminal Disclaimers, refer to www.uspto.gov/patents/process/file/efs/guidance/eTD-info-I.jsp. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/614561 (hereafter '561) in view of Ogura and Nakagawa.",
"‘561 teaches the elements of claim 1 of instant application. However, ‘561 does not explicitly teach coating the materials with oxide or a beam speed of 8 m/min or greater. Evertsson teaches that aluminum or aluminum alloys have a native oxide coating on the surface as discussed in claim 1. Hence it is implied in ‘561 that aluminum workpieces would have native oxide coating in them. Nakagawa teaches a travel speed of 10 m/min in page 16 as discussed above in claim 1 which overlaps with the claimed range of 8 m/min or greater. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘561 to add a traveling speed of 10m/min as taught in Nakagawa.",
"One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be realized,” as taught by Nakagawa et al. in page 18, paragraph 2 of the attached machine translation. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No.",
"16/336333 (hereafter '333) in view of Ogura and Nakagawa. ‘333 teaches the elements of claim 1 of instant application. However, ‘333 does not teach “the beam spot is advanced multiple times”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3 as discussed above. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘333 to add multiple scanning of the welded region to This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No.",
"16/499605 (hereafter '605) in view of Ogura. ‘605 teaches the elements of claim 1 of instant application. However, ‘605 does not teach “the beam spot is advanced multiple times along a closed-curved weld path”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘605 to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al. One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al.",
"in page 7, paragraph 2. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/484010 (hereafter '010) in view of Ogura. ‘010 teaches the elements of claim 1 of instant application. However, ‘010 does not teach “the beam spot is advanced multiple times along a closed-curved weld path”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘010 to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al.",
"One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al. in page 7, paragraph 2. This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is provisionally rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of copending Application No. 16/097689 (hereafter '689) in view of Capostagno. ‘689 teaches the elements of claim 1 of instant application. However, ‘689 does not teach oxide coating of materials. Capostagno teaches coating materials with anodization This is a provisional nonstatutory double patenting rejection because the patentably indistinct claims have not in fact been patented. Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of U.S. patent 10946479(hereafter ‘479) Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-15 of US Patent 10953497(hereafter ‘497) in view of Nakagawa and Capostagno. ‘497 teaches the elements of claim 1 of instant application.",
"However, ‘497 does not teach “a beam travel speed of 8 m/min or greater” and oxide coating. Nakagawa teaches a travel speed of 10 m/min in page 16 as discussed above. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘497 to add a traveling speed of 10m/min as taught in Nakagawa. One of ordinary skill in the art would have been motivated to do so because “generation of bubbles can be suppressed and a good welding state can be realized,” as taught by Nakagawa et al. in page 18, paragraph 2 of the attached machine translation. Capostagno teaches coating materials with anodization in Fig. 25.",
"It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the coating in ‘689 so that the coating oxides would conglomerate at the top surface of weld as taught in Capostagno. One of ordinary skill in the art would have been motivated to do so to improve shear resistance and ohmic resistance of the weld as taught in paragraph [204] in Capostagno. Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-18 of U.S. patent 10953494(hereafter ‘494) in view of Ogura. ‘494 teaches the elements of claim 1 of instant application. However, ‘494 does not teach “the beam spot is advanced multiple times along a closed-curved weld path”. Ogura teaches the laser beam travels along a closed path multiple times in Fig. 2 and 3. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘494 to add multiple scanning of the welded region to develop a melt pool as taught by Ogura et al.",
"One of ordinary skill in the art would have been motivated to do so in order “to reduce the occurrence of welding defects” as taught by Ogura et al. in page 7, paragraph 2. Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of U.S. Patent No. 10675713(hereafter ‘713) in view of Nakagawa. ‘713 teaches the elements of claim 1 of instant application. However, ‘713 does not teach “a beam travel speed of 8 m/min or greater”. Nakagawa teaches a travel speed of 10 m/min in page 16 as discussed above. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method of ‘713 to add a traveling speed of 8m/min or greater as taught in Nakagawa. One of ordinary .",
"Claim 1 is rejected on the ground of nonstatutory double patenting as being unpatentable over claim 1-20 of U.S. Patent No. 10195689(hereafter ‘689). Although the claims at issue are not identical, they are not patentably distinct from each other because instant claim 1 is met by claims 1-20 of ‘689. Response to Arguments Applicant’s arguments filed on October 26, 2021 with respect to claim(s) 1-2, and 4-10 have been considered but are moot because the new ground of rejection based on the amendment of claims. The applicant argues on Page 11 that Fig. 1A shows element 44. However, the available drawing to the office shows the following Fig. 1A with part of the drawing missing. The applicant is requested to submit the complete drawing.",
"PNG media_image1.png 325 385 media_image1.png Greyscale The applicant amended claim 1 to include the following limitations and argued that this makes the method distinguishable over Naito, Ogura, and Nakagawa on pages 12-16. PNG media_image8.png 172 886 media_image8.png Greyscale However, upon further consideration, a new ground(s) of rejection is made in view of Naito, Ogura, Nakagawa, Evertsson, and Capostagno as discussed below. “at least one of the first light metal workpiece and the second light metal workpiece comprising s a coating comprising an oxide;” (Naito teaches aluminum alloy as light metal workpiece in Page 11, paragraph 5. Naito does not explicitly teach an oxide coating on Aluminum alloy. Evertsson teaches the oxidation properties of Aluminum and its alloys.",
"Evertsson teaches in Introduction “the amorphous native aluminum oxide film which is formed spontaneously at ambient pressures and at low temperatures dictates the properties of functional aluminum.” Hence it is implied that aluminum or aluminum alloy of Naito has a native oxide layer. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to design the aluminum workpieces in Naito et al. with oxide coating as taught in Evertsson. One of ordinary skill in the art would have been motivated to do so in order to reduce corrosion as taught in Introduction section in Evertsson.) “the advancing causing fragmenting of the coating to create oxide coating fragments; forming a conglomeration on the top surface, the conglomeration comprising the oxide coating fragments;” Capostagno teaches a method to form a weld been multiple metallic materials in a welding pattern. Capostagno further teaches aluminum as the metallic material in paragraph [2]. Additionally, Capostagno teaches an anodized coating on the material before welding in paragraphs [187] and [196].",
"Fig. 21, and 31 of Capostagno teaches conglomeration 132 on top surface of the weld 8 and 310 respectively. Paragraph [110] teaches “Vapour pressure caused by the rapid heating of the first material 1 causes at least some of the first material 1 to be injected into the hole 71 or ejected from the hole 71. This is shown by the material 131 being injected into the key hole 133 formed in the second material 2, and the material 132 being emitted out of the hole 71. The materials 131 and 132 may be in the vapour phase, fluid phase, solid phase, or a combination of at least two of the forgoing material phases. Molten second material 81 can then flow into the hole 71 as shown with reference to FIG 14.” Even though Capostagno does not explicitly teach that 132 comprises fragment of coating oxide, it is implicit that rapid heating and laser beam would have to cause fragmentation of the top coating layer of material 1 to make hole 71 as well as 133 and part of the fragments would be present in 132 that eventually conglomerates on top surface of weld. It would have been obvious to a person having ordinary skill in the art before the effective filing date of the invention to modify the welding method in in Naito so that the coating oxides would conglomerate at the top surface of weld as taught in Capostagno. One of ordinary skill in the art would have been motivated to do so to improve shear resistance and ohmic resistance of the weld as taught in paragraph [204] in Capostagno.",
"Additionally, the limitation recites the effects of advancing the laser spot multiple times along a closed curve path. The conglomeration of oxide is a result of the advancing step. MPEP 2112.01-I states \"Where the claimed and prior art products are identical or substantially identical in structure or composition, or are produced by identical or substantially identical processes, a prima facie case of either anticipation or obviousness has been established. In re Best, 562 F.2d 1252, 1255, 195 USPQ 430, 433 (CCPA 1977). In this case, the advancing step is taught in prior art and hence obviousness of oxide fragmentation and conglomeration is established.)",
"PNG media_image6.png 616 641 media_image6.png Greyscale Fig. 13 of Capostagno teaches metal and metal oxide getting fragmented during welding PNG media_image7.png 644 951 media_image7.png Greyscale Fig. 31 of Capostagno teaches metal and metal oxide conglomerate on top weld surface Conclusion Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is Any inquiry concerning this communication or earlier communications from the examiner should be directed to FAHMIDA FERDOUSI whose telephone number is (303)297-4341.",
"The examiner can normally be reached on Monday-Friday; 9:00AM-3:00PM; PST. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Ibrahime Abraham can be reached on (571) 270-5569. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. /FAHMIDA FERDOUSI/Examiner, Art Unit 3761 /JUSTIN C DODSON/Primary Examiner, Art Unit 3761"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-11-28.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
ELLIS, Judge. The East Baton Rouge Parish Council adopted resolutions on January 10, 1979, and September 26, 1979, by virtue of which they waived certain zoning restrictions on two parcels of ground in Plaza 12 Garden Homes Subdivision. This suit was brought seeking, inter alia, a declaratory judgment declaring “that the East Baton Rouge Parish Council is without authority to grant or to consider and vote upon such waivers or suspensions of or special exemptions or exceptions from the Zoning Ordinance or Subdivision Ordinances and Regulations of East Baton Rouge Parish; and, that all such waivers granted on the subject property (i. e., the Plaza 12 Garden Homes Subdivision) are null and void and without effect.” Mr. Sholar brought the suit as a citizen, a registered voter and the owner of a parcel of ground adjacent to Plaza 12 Subdivision. On January 23, 1980, the Council rescinded the resolutions of January 10 and September 26, 1979. Thereafter all defendants moved that the matter be dismissed as moot. After a hearing, the Court found that there no longer existed a justiciable controversy, and dismissed the suit. From the judgment of dismissal, plaintiff has appealed. In Abbott v. Parker, 259 La. 279, 249 So.2d 908 (1971), the court said: “A ‘justiciable controversy’ connotes, in the present sense, an existing actual and substantial dispute, as distinguished from one that is merely hypothetical or abstract, and a dispute which involves the legal relations of the parties who have real adverse interests, and upon which the judgment of the court may effectively operate through a decree of conclusive character. Further, the plaintiff should have a legally protectable and tangible interest at stake, and the dispute presented should be of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” In In re Gulf Oxygen Welder’s Sup. Prof. Shar. P. & T. A., 297 So.2d 663 (La.1974), the court stated that a justiciable controversy existed when there was “a true interest of the plaintiff (i. e., ‘standing’) and the defendant in having the issue resolved, as well as an adversity of interest between them.” Despite the rescission of the resolutions directly affecting his property, plaintiff still contends that there remains a justiciable controversy between him and the defendants. We cannot agree. We are asked to make an abstract declaration relative to the authority of the Council to grant waivers, when no such waiver is complained of in the suit, and when no status or right of any party will be immediately affected by our ruling. This would amount to an advisory opinion, which we are not permitted to render. The judgment appealed from is therefore affirmed at plaintiff’s cost. AFFIRMED. | 07-29-2022 | [
"ELLIS, Judge. The East Baton Rouge Parish Council adopted resolutions on January 10, 1979, and September 26, 1979, by virtue of which they waived certain zoning restrictions on two parcels of ground in Plaza 12 Garden Homes Subdivision. This suit was brought seeking, inter alia, a declaratory judgment declaring “that the East Baton Rouge Parish Council is without authority to grant or to consider and vote upon such waivers or suspensions of or special exemptions or exceptions from the Zoning Ordinance or Subdivision Ordinances and Regulations of East Baton Rouge Parish; and, that all such waivers granted on the subject property (i. e., the Plaza 12 Garden Homes Subdivision) are null and void and without effect.” Mr. Sholar brought the suit as a citizen, a registered voter and the owner of a parcel of ground adjacent to Plaza 12 Subdivision. On January 23, 1980, the Council rescinded the resolutions of January 10 and September 26, 1979.",
"Thereafter all defendants moved that the matter be dismissed as moot. After a hearing, the Court found that there no longer existed a justiciable controversy, and dismissed the suit. From the judgment of dismissal, plaintiff has appealed. In Abbott v. Parker, 259 La. 279, 249 So.2d 908 (1971), the court said: “A ‘justiciable controversy’ connotes, in the present sense, an existing actual and substantial dispute, as distinguished from one that is merely hypothetical or abstract, and a dispute which involves the legal relations of the parties who have real adverse interests, and upon which the judgment of the court may effectively operate through a decree of conclusive character. Further, the plaintiff should have a legally protectable and tangible interest at stake, and the dispute presented should be of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” In In re Gulf Oxygen Welder’s Sup. Prof. Shar. P. & T. A., 297 So.2d 663 (La.1974), the court stated that a justiciable controversy existed when there was “a true interest of the plaintiff (i. e., ‘standing’) and the defendant in having the issue resolved, as well as an adversity of interest between them.” Despite the rescission of the resolutions directly affecting his property, plaintiff still contends that there remains a justiciable controversy between him and the defendants. We cannot agree.",
"We are asked to make an abstract declaration relative to the authority of the Council to grant waivers, when no such waiver is complained of in the suit, and when no status or right of any party will be immediately affected by our ruling. This would amount to an advisory opinion, which we are not permitted to render. The judgment appealed from is therefore affirmed at plaintiff’s cost. AFFIRMED."
] | https://www.courtlistener.com/api/rest/v3/opinions/7507472/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Citation Nr: 1615142
Decision Date: 04/14/16 Archive Date: 04/26/16
DOCKET NO. 12-20 200 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office in St. Petersburg, Florida
THE ISSUES
Whether new and material evidence has been received to reopen the claim of service connection for a psychiatric disorder to include schizophrenia, bipolar disorder, and posttraumatic stress disorder (PTSD).
REPRESENTATION
Appellant represented by: Florida Department of Veterans Affairs
WITNESS AT HEARING ON APPEAL
Veteran
ATTORNEY FOR THE BOARD
J. Connolly, Counsel
INTRODUCTION
The Veteran served on active duty from February 1971 to December 1972.
This matter comes to the Board of Veterans' Appeals (Board) on appeal from March and April 2011 rating decisions of the St. Petersburg, Florida Regional Office (RO) of the Department of Veterans Affairs (VA). In February 2016, the Veteran testified at a Travel Board hearing before the undersigned.
The Board notes the United States Court of Appeals for Veterans Claims (Court) held that the scope of a claim includes any disability that may reasonably be encompassed by the claimant's description of the claim, reported symptoms, and the other information of record. Clemons v. Shinseki, 23 Vet. App. 1, 5 (2009); Brokowski v. Shinseki, 23 Vet. App. 79 (2009). Therefore, the issue on appeal has been recharacterized as indicated on the front page of this decision to encompass all psychiatric disorders.
The issue of service connection for a psychiatric disorder to include schizophrenia, bipolar disorder, and PTSD is addressed in the REMAND portion of the decision below and is REMANDED to the AOJ.
FINDINGS OF FACT
1. In January 2009, the RO denied service connection for a bipolar disorder and determined that new and material evidence had not been submitted to reopen the claim of service connection for schizophrenia and PTSD. The Veteran did not appeal.
2. Evidence submitted since the RO's January 2009 decision, by itself or when considered with previous evidence of record, relates to an unestablished fact necessary to substantiate the claim of service connection for a psychiatric disorder, and therefore raises a reasonable possibility of substantiating the claim.
CONCLUSIONS OF LAW
1. The RO's January 2009 rating decision which denied service connection for a bipolar disorder and determined that new and material evidence had not been submitted to reopen the claim of service connection for schizophrenia and PTSD is final. 38 U.S.C.A. § 7105 (West 2014).
2. New and material evidence has been received since the RO's January 2009 rating decision; thus, the claim of service connection for a psychiatric disorder is reopened. 38 U.S.C.A. §§ 5108, 7105 (West 2014); 38 C.F.R. § 3.156 (2015).
REASONS AND BASES FOR FINDINGS AND CONCLUSIONS
There has been a significant change in the law with the enactment of the Veterans Claims Assistance Act of 2000 (VCAA). See 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5106, 5107, 5126; 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326. With regard to the issue of whether new and material evidence has been received to reopen the claim of service connection for an acquired psychiatric disorder, the Veteran's claim is being granted to the extent that it is reopened. As such, any deficiencies with regard to VCAA are harmless and nonprejudicial.
New and Material
In May 1979, the RO denied service connection for schizophrenia on the basis that schizophrenia did not have its original during service or within the presumptive period. The Veteran did not initiate an appeal to that rating decision. Therefore, the RO's May 1979 rating decision is final. 38 U.S.C.A. § 7105.
In August 1984, the RO determined that new and material evidence had not been received to reopen the claim of service connection for schizophrenia and no error was found in the May 1979 rating decision. The Veteran did not initiate an appeal to that rating decision. Therefore, the RO's August 1984 rating decision is final. 38 U.S.C.A. § 7105.
In June 1986, the RO determined that new and material evidence had not been received to reopen the claim of service connection for schizophrenia and no error was found in the May 1979 and August 1984 rating decisions. The Veteran did not initiate an appeal to that rating decision.
In July 1988, the RO confirmed and continued the prior denial. The Veteran did not initiate an appeal to that rating decision. Therefore, the RO's July 1988 rating decision is final. 38 U.S.C.A. § 7105.
In May 1990, the RO determined that new and material evidence had not been received to reopen the claim of service connection for a nervous condition to include PTSD. An April 1992 rating decision was promulgated for record purposes to formally code the denial of service connection for the specific disability of PTSD. The Veteran perfected an appeal as to the denial of service connection for PTSD. In an April 1995 rating decision, service connection for PTSD was denied by the Board. The Veteran did not appeal that decision to the Court and it is final. 38 U.S.C.A. § 7104(b).
In a January 2009 rating decision, the RO determined that service connection for bipolar disorder was not warranted on the merits because the evidence did not show that bipolar disorder was either incurred in or was aggravated by military service. The RO also determined that new and material evidence had not been received to reopen the claim of service connection for schizophrenia or PTSD. The Veteran did not initiate an appeal to that rating decision. Further, additional evidence was not received within one year of that decision. Bond v. Shinseki, 659 F.3d 1362, 1367-8 (Fed. Cir. 2011). Therefore, the RO's January 2009 rating decision is final. 38 U.S.C.A. § 7105.
Prior unappealed decisions are final. However, a claim will be reopened and the former disposition reviewed if new and material evidence is presented or secured with respect to the claim which has been disallowed. 38 U.S.C.A. § 5108; 38 C.F.R. § 3.156(a). The Court has held that, when "new and material evidence" is presented or secured with respect to a previously and finally disallowed claim, VA must reopen the claim. Manio v. Derwinski, 1 Vet. App. 140, 145 (1991).
New evidence means existing evidence not previously submitted to agency decisionmakers. Material evidence means existing evidence that, by itself or when considered with previous evidence of record, relates to an unestablished fact necessary to substantiate the claim. New and material evidence can be neither cumulative nor redundant of the evidence of record at the time of the last prior final denial of the claim sought to be reopened, and must raise a reasonable possibility of substantiating the claim. 38 C.F.R. § 3.156(a). According to the Court, the pertinent VA law requires that in order to reopen a previously and finally disallowed claim, there must be new and material evidence presented or secured since the time that the claim was finally disallowed on any basis. Evans v. Brown, 9 Vet. App. 273 (1996).
Since the last prior final decision, evidence has been added to the record. The additional evidence of record consists of medical records confirming diagnoses of schizophrenia/schizophrenic reaction and bipolar disorder. In addition, lay evidence has been received from the Veteran's brother-in-law and niece who indicated that prior to service, the Veteran did not exhibit observable psychiatric symptoms, but had such symptoms after service.
For the purpose of establishing whether new and material evidence has been submitted, the truthfulness of evidence is presumed, unless the evidence is inherently incredible or consists of statements which are beyond the competence of the person(s) making them. See Justus v. Principi, 3 Vet. App. 510, 513 (1992); Meyer v. Brown, 9 Vet. App. 425, 429 (1996); King v. Brown, 5 Vet. App. 19, 21 (1993); but see Duran v. Brown, 7 Vet. App. 216 (1994) ("Justus does not require the Secretary [of VA] to consider the patently incredible to be credible"). Furthermore, the United States Court of Appeals for the Federal Circuit (Federal Circuit) has indicated that evidence may be considered new and material if it contributes to a more complete picture of the circumstances surrounding the origin of a veteran's injury or disability, even where it will not eventually convince the Board to grant the claim. Hodge v. West, 155 F.3d 1356, 1363 (Fed. Cir. 1998).
In Shade v. Shinseki, 24 Vet. App. 110 (2010), the Court stated that when determining whether the submitted evidence meets the definition of new and material evidence, VA must consider whether the new evidence could, if the claim were reopened, reasonably result in substantiation of the claim. Id. at 118. The Court stated that when determining whether the submitted evidence meets the definition of new and material evidence, VA must consider whether the new evidence could, if the claim were reopened, reasonably result in substantiation of the claim. Id. at 118. At the hearing, the undersigned noted that this was a rather low threshold.
The Board finds that there is new evidence suggesting that the Veteran's psychiatric manifestations/diagnoses had their onset within the presumptive period. The evidence shows current diagnoses. Therefore, this new evidence raises a reasonable possibility of substantiating the claim, and the element of a nexus could be established by providing a VA examination; the claim may be reopened. The Shade threshold has been met here and thereby triggers VA's duty to assist.
New and material evidence has been received since the RO's January 2009 decision; thus, the claim of service connection for a psychiatric disorder is reopened. 38 U.S.C.A. §§ 5108, 7105; 38 C.F.R. § 3.156.
ORDER
The application to reopen the claim of service connection for a psychiatric disability is granted.
REMAND
The claim of service connection for a psychiatric disorder has been reopened. At his Travel Board hearing, the Veteran testified that he had been awarded benefits from the Social Security Administration (SSA); thus, those records should be obtained. The record contains several psychiatric diagnoses. The Board finds that a VA examination should be conducted to ascertain the current diagnosis and whether it is etiologically connected to service. See McLendon v. Nicholson, 20 Vet. App. 79 (2006).
Accordingly, this matter is REMANDED for the following actions:
1. Obtain from SSA a copy of their decision regarding the Veteran's claim for Social Security disability benefits, as well as the medical records relied upon in that decision.
2. Schedule the Veteran for a VA psychiatric examination. The record and a copy of this remand must be reviewed by the examiner. All necessary tests should be conducted and all clinical findings reported in detail. The examiner is requested to identify all psychiatric disorders found to be present, including, if appropriate, schizophrenia, bipolar disorder, and PTSD. The examiner should provide an opinion as to whether it is at least as likely as not (i.e., 50 percent or greater probability) that any current psychiatric disorder had its clinical onset during active duty, if a psychosis was manifest within one year of service, or if a current psychiatric disability is related to any in-service disease, injury, or event.
Also, if the examiner finds that the Veteran meets the diagnostic criteria for diagnosis of PTSD made after service, the examiner should indicate whether there is a claimed stressor made by the Veteran which is adequate to support a diagnosis of PTSD and whether the Veteran's symptoms are related to the claimed stressor. The examiner must also specifically state whether the claimed stressor is related to the Veteran's military service to include having a fear of hostile military or terrorist activity, including but not limited to an actual or potential improvised explosive device; vehicle-imbedded explosive device; incoming artillery, rocket, or mortar fire; grenade; small arms fire, including suspected sniper fire; or attack upon friendly military aircraft.
The examiner must provide a comprehensive report including complete rationales for all conclusions reached.
3. The AOJ should review the medical opinion obtained above to ensure that the remand directives have been accomplished. If all questions posed are not answered or sufficiently answered, the AOJ should return the case to the examiner for completion of the inquiry.
4. Finally, the AOJ should readjudicate the claim on appeal in light of all of the evidence of record. If the issue remains denied, the Veteran should be provided with a supplemental statement of the case and afforded a reasonable period of time within which to respond thereto.
The Veteran has the right to submit additional evidence and argument on the matter or matters the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999).
This claim must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board of Veterans' Appeals or by the United States Court of Appeals for Veterans Claims for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A. §§ 5109B, 7112 (West 2014).
______________________________________________
S. L. Kennedy
Veterans Law Judge, Board of Veterans' Appeals
Department of Veterans Affairs | 04-14-2016 | [
"Citation Nr: 1615142 Decision Date: 04/14/16 Archive Date: 04/26/16 DOCKET NO. 12-20 200 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in St. Petersburg, Florida THE ISSUES Whether new and material evidence has been received to reopen the claim of service connection for a psychiatric disorder to include schizophrenia, bipolar disorder, and posttraumatic stress disorder (PTSD). REPRESENTATION Appellant represented by: Florida Department of Veterans Affairs WITNESS AT HEARING ON APPEAL Veteran ATTORNEY FOR THE BOARD J. Connolly, Counsel INTRODUCTION The Veteran served on active duty from February 1971 to December 1972. This matter comes to the Board of Veterans' Appeals (Board) on appeal from March and April 2011 rating decisions of the St. Petersburg, Florida Regional Office (RO) of the Department of Veterans Affairs (VA).",
"In February 2016, the Veteran testified at a Travel Board hearing before the undersigned. The Board notes the United States Court of Appeals for Veterans Claims (Court) held that the scope of a claim includes any disability that may reasonably be encompassed by the claimant's description of the claim, reported symptoms, and the other information of record. Clemons v. Shinseki, 23 Vet. App. 1, 5 (2009); Brokowski v. Shinseki, 23 Vet. App.",
"79 (2009). Therefore, the issue on appeal has been recharacterized as indicated on the front page of this decision to encompass all psychiatric disorders. The issue of service connection for a psychiatric disorder to include schizophrenia, bipolar disorder, and PTSD is addressed in the REMAND portion of the decision below and is REMANDED to the AOJ. FINDINGS OF FACT 1. In January 2009, the RO denied service connection for a bipolar disorder and determined that new and material evidence had not been submitted to reopen the claim of service connection for schizophrenia and PTSD.",
"The Veteran did not appeal. 2. Evidence submitted since the RO's January 2009 decision, by itself or when considered with previous evidence of record, relates to an unestablished fact necessary to substantiate the claim of service connection for a psychiatric disorder, and therefore raises a reasonable possibility of substantiating the claim. CONCLUSIONS OF LAW 1. The RO's January 2009 rating decision which denied service connection for a bipolar disorder and determined that new and material evidence had not been submitted to reopen the claim of service connection for schizophrenia and PTSD is final. 38 U.S.C.A. § 7105 (West 2014). 2. New and material evidence has been received since the RO's January 2009 rating decision; thus, the claim of service connection for a psychiatric disorder is reopened. 38 U.S.C.A. §§ 5108, 7105 (West 2014); 38 C.F.R. § 3.156 (2015). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS There has been a significant change in the law with the enactment of the Veterans Claims Assistance Act of 2000 (VCAA).",
"See 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5106, 5107, 5126; 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326. With regard to the issue of whether new and material evidence has been received to reopen the claim of service connection for an acquired psychiatric disorder, the Veteran's claim is being granted to the extent that it is reopened. As such, any deficiencies with regard to VCAA are harmless and nonprejudicial. New and Material In May 1979, the RO denied service connection for schizophrenia on the basis that schizophrenia did not have its original during service or within the presumptive period.",
"The Veteran did not initiate an appeal to that rating decision. Therefore, the RO's May 1979 rating decision is final. 38 U.S.C.A. § 7105. In August 1984, the RO determined that new and material evidence had not been received to reopen the claim of service connection for schizophrenia and no error was found in the May 1979 rating decision. The Veteran did not initiate an appeal to that rating decision. Therefore, the RO's August 1984 rating decision is final. 38 U.S.C.A. § 7105.",
"In June 1986, the RO determined that new and material evidence had not been received to reopen the claim of service connection for schizophrenia and no error was found in the May 1979 and August 1984 rating decisions. The Veteran did not initiate an appeal to that rating decision. In July 1988, the RO confirmed and continued the prior denial. The Veteran did not initiate an appeal to that rating decision. Therefore, the RO's July 1988 rating decision is final. 38 U.S.C.A. § 7105. In May 1990, the RO determined that new and material evidence had not been received to reopen the claim of service connection for a nervous condition to include PTSD. An April 1992 rating decision was promulgated for record purposes to formally code the denial of service connection for the specific disability of PTSD.",
"The Veteran perfected an appeal as to the denial of service connection for PTSD. In an April 1995 rating decision, service connection for PTSD was denied by the Board. The Veteran did not appeal that decision to the Court and it is final. 38 U.S.C.A. § 7104(b). In a January 2009 rating decision, the RO determined that service connection for bipolar disorder was not warranted on the merits because the evidence did not show that bipolar disorder was either incurred in or was aggravated by military service. The RO also determined that new and material evidence had not been received to reopen the claim of service connection for schizophrenia or PTSD. The Veteran did not initiate an appeal to that rating decision. Further, additional evidence was not received within one year of that decision. Bond v. Shinseki, 659 F.3d 1362, 1367-8 (Fed. Cir.",
"2011). Therefore, the RO's January 2009 rating decision is final. 38 U.S.C.A. § 7105. Prior unappealed decisions are final. However, a claim will be reopened and the former disposition reviewed if new and material evidence is presented or secured with respect to the claim which has been disallowed. 38 U.S.C.A. § 5108; 38 C.F.R. § 3.156(a). The Court has held that, when \"new and material evidence\" is presented or secured with respect to a previously and finally disallowed claim, VA must reopen the claim. Manio v. Derwinski, 1 Vet.",
"App. 140, 145 (1991). New evidence means existing evidence not previously submitted to agency decisionmakers. Material evidence means existing evidence that, by itself or when considered with previous evidence of record, relates to an unestablished fact necessary to substantiate the claim. New and material evidence can be neither cumulative nor redundant of the evidence of record at the time of the last prior final denial of the claim sought to be reopened, and must raise a reasonable possibility of substantiating the claim. 38 C.F.R. § 3.156(a). According to the Court, the pertinent VA law requires that in order to reopen a previously and finally disallowed claim, there must be new and material evidence presented or secured since the time that the claim was finally disallowed on any basis. Evans v. Brown, 9 Vet.",
"App. 273 (1996). Since the last prior final decision, evidence has been added to the record. The additional evidence of record consists of medical records confirming diagnoses of schizophrenia/schizophrenic reaction and bipolar disorder. In addition, lay evidence has been received from the Veteran's brother-in-law and niece who indicated that prior to service, the Veteran did not exhibit observable psychiatric symptoms, but had such symptoms after service. For the purpose of establishing whether new and material evidence has been submitted, the truthfulness of evidence is presumed, unless the evidence is inherently incredible or consists of statements which are beyond the competence of the person(s) making them. See Justus v. Principi, 3 Vet.",
"App. 510, 513 (1992); Meyer v. Brown, 9 Vet. App. 425, 429 (1996); King v. Brown, 5 Vet. App. 19, 21 (1993); but see Duran v. Brown, 7 Vet. App. 216 (1994) (\"Justus does not require the Secretary [of VA] to consider the patently incredible to be credible\"). Furthermore, the United States Court of Appeals for the Federal Circuit (Federal Circuit) has indicated that evidence may be considered new and material if it contributes to a more complete picture of the circumstances surrounding the origin of a veteran's injury or disability, even where it will not eventually convince the Board to grant the claim. Hodge v. West, 155 F.3d 1356, 1363 (Fed. Cir.",
"1998). In Shade v. Shinseki, 24 Vet. App. 110 (2010), the Court stated that when determining whether the submitted evidence meets the definition of new and material evidence, VA must consider whether the new evidence could, if the claim were reopened, reasonably result in substantiation of the claim. Id. at 118. The Court stated that when determining whether the submitted evidence meets the definition of new and material evidence, VA must consider whether the new evidence could, if the claim were reopened, reasonably result in substantiation of the claim. Id. at 118. At the hearing, the undersigned noted that this was a rather low threshold. The Board finds that there is new evidence suggesting that the Veteran's psychiatric manifestations/diagnoses had their onset within the presumptive period.",
"The evidence shows current diagnoses. Therefore, this new evidence raises a reasonable possibility of substantiating the claim, and the element of a nexus could be established by providing a VA examination; the claim may be reopened. The Shade threshold has been met here and thereby triggers VA's duty to assist. New and material evidence has been received since the RO's January 2009 decision; thus, the claim of service connection for a psychiatric disorder is reopened. 38 U.S.C.A. §§ 5108, 7105; 38 C.F.R. § 3.156. ORDER The application to reopen the claim of service connection for a psychiatric disability is granted. REMAND The claim of service connection for a psychiatric disorder has been reopened. At his Travel Board hearing, the Veteran testified that he had been awarded benefits from the Social Security Administration (SSA); thus, those records should be obtained. The record contains several psychiatric diagnoses. The Board finds that a VA examination should be conducted to ascertain the current diagnosis and whether it is etiologically connected to service. See McLendon v. Nicholson, 20 Vet.",
"App. 79 (2006). Accordingly, this matter is REMANDED for the following actions: 1. Obtain from SSA a copy of their decision regarding the Veteran's claim for Social Security disability benefits, as well as the medical records relied upon in that decision. 2. Schedule the Veteran for a VA psychiatric examination. The record and a copy of this remand must be reviewed by the examiner. All necessary tests should be conducted and all clinical findings reported in detail. The examiner is requested to identify all psychiatric disorders found to be present, including, if appropriate, schizophrenia, bipolar disorder, and PTSD. The examiner should provide an opinion as to whether it is at least as likely as not (i.e., 50 percent or greater probability) that any current psychiatric disorder had its clinical onset during active duty, if a psychosis was manifest within one year of service, or if a current psychiatric disability is related to any in-service disease, injury, or event. Also, if the examiner finds that the Veteran meets the diagnostic criteria for diagnosis of PTSD made after service, the examiner should indicate whether there is a claimed stressor made by the Veteran which is adequate to support a diagnosis of PTSD and whether the Veteran's symptoms are related to the claimed stressor. The examiner must also specifically state whether the claimed stressor is related to the Veteran's military service to include having a fear of hostile military or terrorist activity, including but not limited to an actual or potential improvised explosive device; vehicle-imbedded explosive device; incoming artillery, rocket, or mortar fire; grenade; small arms fire, including suspected sniper fire; or attack upon friendly military aircraft.",
"The examiner must provide a comprehensive report including complete rationales for all conclusions reached. 3. The AOJ should review the medical opinion obtained above to ensure that the remand directives have been accomplished. If all questions posed are not answered or sufficiently answered, the AOJ should return the case to the examiner for completion of the inquiry. 4. Finally, the AOJ should readjudicate the claim on appeal in light of all of the evidence of record. If the issue remains denied, the Veteran should be provided with a supplemental statement of the case and afforded a reasonable period of time within which to respond thereto. The Veteran has the right to submit additional evidence and argument on the matter or matters the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999). This claim must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board of Veterans' Appeals or by the United States Court of Appeals for Veterans Claims for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A.",
"§§ 5109B, 7112 (West 2014). ______________________________________________ S. L. Kennedy Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs"
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
OPINION ROBERTSON, Justice. This appeal involves the legal effect of recitals in a deed. A motion for summary judgment was filed by both plaintiffs and defendants. The trial court granted plaintiffs’ motion and this appeal followed. We reverse. The controversy involves the ownership of a one-fourth perpetual non-participating royalty interest in an 86 acre tract of land in Burleson County. A.S. Crow is the common source of title. On October 7, 1921 he executed a deed to W.T. Macy granting ... that certain one-half of an undivided interest in that tract or parcel of land situated in Burleson County, Texas containing 86 acres, more or less, and more particularly described as follows: ... On November 27, 1929 Crow executed a quitclaim deed covering the same property in favor of H.H. Coffield. On the same day Macy executed a quitclaim deed covering the same property in favor of Coffield. In this quitclaim deed, Macy reserved unto himself, his heirs and assigns “one-fourth of the royalty from gas, oil or other minerals” produced on said land. Appellees, the heirs of Macy, have assumed any rights that Macy reserved under this term of the quitclaim deed. We find the case of W.T. Carter & Bro. v. Ewers, 133 Tex. 616, 131 S.W.2d 86 (Tex.Com.App.1939, opinion adopted) to be con*881trolling in the matter before us. In that case the deed in question read: an undivided interest in and to a subdivision of 200 acres of a survey in the name of Swing, situated in the County of Polk, State of Texas. The court held the deed to be void for uncertainty of the description of the interest purported to be conveyed by the grantors. The court further remarked that [t]he description of the 200-acre subdivision is such that if the deed had purported to convey the subdivision itself rather than ‘an undivided interest’ therein, the instrument would not fail as a conveyance on account of uncertainty of description .... Id. at 87. Although the deed before us reads “that certain one-half of an undivided interest,” the one-half does nothing to cure the defect; the problem is the use of the uncertain phrase “an undivided interest.” One-half of an undivided interest is just as uncertain as an undivided interest. Appel-lees cite cases enumerating general subsidiary rules of construction which are not applicable to the case before us. The rule we must apply is discussed in a case cited in appellees’ brief: Davis v. Andrews, 361 S.W.2d 419, 423 (Tex.Civ.App.—Dallas 1962, writ ref’d n.r.e.). Again, it has been said that the intention as expressed in the deed must be given effect, regardless of the intention that the parties had intended to express but that they failed to express. If there is no ambiguity in a deed, the instrument will be enforced as written, even though it does not express the original intention of the parties. We have a deed in which the words and phrases of the document themselves are indeterminative. To save this deed we would have to presume “an undivided interest” meant “our undivided interest” or “all of our undivided interest.” That this cannot be done is made clear in W.T. Carter & Bro. v. Ewers, 131 S.W.2d 86, at 88; and Dahlberg v. Holden, 150 Tex. 179, 238 S.W.2d 699, 701-702 (1951). Relying heavily on Greene v. White, 137 Tex. 361, 153 S.W.2d 575 (1941), appellees argue that even if Macy acquired no interest in the subject property from Crow, the Macy-Coffield deed is sufficient to reserve one-fourth of the royalty to Macy and his heirs since “the parties to a deed, just like the parties to a contract, are bound by the terms of the deed.” While this proposition is discussed extensively by the commissioner who authored the opinion for the supreme court, it means little, if anything, in view of the final holding, dictated by the court. The Court’s opinion is that if at the time the Greene-Garrett deed was executed Alex and Mandy Garrett had acquired title to the land by limitation, the deed was not effective to convey anything, and that, in so far as Alex Garrett’s interest in the land was concerned, the Greene-Garrett deed did not have the effect of reserving the minerals to Greene either at the time of its execution or upon its ratification by Mandy Garrett. Id. 153 S.W.2d at 587. Since we have held the Crow-Maey deed conveyed nothing due to its uncertainty, it follows that Macy, after the supposed conveyance, had no interest in the property which he could reserve or convey. Appellants’ first point of error is sustained; the trial court erred in granting appellees’ summary judgment. Pursuant to Rule 434, TEX.R.CIV.P., we reverse the trial court’s judgment and render the judgment the trial court should have rendered. Therefore judgment shall be entered providing that the Crow-Macy Deed is void, that appellees Martha Liedtke, et al, have no interest in the above described property and that they take nothing by their suit and that appellants Robert Ellett and Charles Avery, Jr., Co-Executors of the Estate of H.H. Coffield, et al, are entitled to all the money presently being held in the registry of the court including all interest thereon as the owners of the one-fourth royalty interest in dispute. It is so ordered. | 10-01-2021 | [
"OPINION ROBERTSON, Justice. This appeal involves the legal effect of recitals in a deed. A motion for summary judgment was filed by both plaintiffs and defendants. The trial court granted plaintiffs’ motion and this appeal followed. We reverse. The controversy involves the ownership of a one-fourth perpetual non-participating royalty interest in an 86 acre tract of land in Burleson County. A.S. Crow is the common source of title. On October 7, 1921 he executed a deed to W.T. Macy granting ... that certain one-half of an undivided interest in that tract or parcel of land situated in Burleson County, Texas containing 86 acres, more or less, and more particularly described as follows: ... On November 27, 1929 Crow executed a quitclaim deed covering the same property in favor of H.H. Coffield. On the same day Macy executed a quitclaim deed covering the same property in favor of Coffield.",
"In this quitclaim deed, Macy reserved unto himself, his heirs and assigns “one-fourth of the royalty from gas, oil or other minerals” produced on said land. Appellees, the heirs of Macy, have assumed any rights that Macy reserved under this term of the quitclaim deed. We find the case of W.T. Carter & Bro. v. Ewers, 133 Tex. 616, 131 S.W.2d 86 (Tex.Com.App.1939, opinion adopted) to be con*881trolling in the matter before us. In that case the deed in question read: an undivided interest in and to a subdivision of 200 acres of a survey in the name of Swing, situated in the County of Polk, State of Texas. The court held the deed to be void for uncertainty of the description of the interest purported to be conveyed by the grantors. The court further remarked that [t]he description of the 200-acre subdivision is such that if the deed had purported to convey the subdivision itself rather than ‘an undivided interest’ therein, the instrument would not fail as a conveyance on account of uncertainty of description .... Id.",
"at 87. Although the deed before us reads “that certain one-half of an undivided interest,” the one-half does nothing to cure the defect; the problem is the use of the uncertain phrase “an undivided interest.” One-half of an undivided interest is just as uncertain as an undivided interest. Appel-lees cite cases enumerating general subsidiary rules of construction which are not applicable to the case before us. The rule we must apply is discussed in a case cited in appellees’ brief: Davis v. Andrews, 361 S.W.2d 419, 423 (Tex.Civ.App.—Dallas 1962, writ ref’d n.r.e.). Again, it has been said that the intention as expressed in the deed must be given effect, regardless of the intention that the parties had intended to express but that they failed to express. If there is no ambiguity in a deed, the instrument will be enforced as written, even though it does not express the original intention of the parties. We have a deed in which the words and phrases of the document themselves are indeterminative.",
"To save this deed we would have to presume “an undivided interest” meant “our undivided interest” or “all of our undivided interest.” That this cannot be done is made clear in W.T. Carter & Bro. v. Ewers, 131 S.W.2d 86, at 88; and Dahlberg v. Holden, 150 Tex. 179, 238 S.W.2d 699, 701-702 (1951). Relying heavily on Greene v. White, 137 Tex. 361, 153 S.W.2d 575 (1941), appellees argue that even if Macy acquired no interest in the subject property from Crow, the Macy-Coffield deed is sufficient to reserve one-fourth of the royalty to Macy and his heirs since “the parties to a deed, just like the parties to a contract, are bound by the terms of the deed.” While this proposition is discussed extensively by the commissioner who authored the opinion for the supreme court, it means little, if anything, in view of the final holding, dictated by the court.",
"The Court’s opinion is that if at the time the Greene-Garrett deed was executed Alex and Mandy Garrett had acquired title to the land by limitation, the deed was not effective to convey anything, and that, in so far as Alex Garrett’s interest in the land was concerned, the Greene-Garrett deed did not have the effect of reserving the minerals to Greene either at the time of its execution or upon its ratification by Mandy Garrett. Id. 153 S.W.2d at 587. Since we have held the Crow-Maey deed conveyed nothing due to its uncertainty, it follows that Macy, after the supposed conveyance, had no interest in the property which he could reserve or convey. Appellants’ first point of error is sustained; the trial court erred in granting appellees’ summary judgment.",
"Pursuant to Rule 434, TEX.R.CIV.P., we reverse the trial court’s judgment and render the judgment the trial court should have rendered. Therefore judgment shall be entered providing that the Crow-Macy Deed is void, that appellees Martha Liedtke, et al, have no interest in the above described property and that they take nothing by their suit and that appellants Robert Ellett and Charles Avery, Jr., Co-Executors of the Estate of H.H. Coffield, et al, are entitled to all the money presently being held in the registry of the court including all interest thereon as the owners of the one-fourth royalty interest in dispute. It is so ordered."
] | https://www.courtlistener.com/api/rest/v3/opinions/5061491/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
46 Mich. App. 97 (1973) 207 N.W.2d 461 PEOPLE v. WAKEFIELD Docket No. 14622. Michigan Court of Appeals. Decided March 29, 1973. Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cahalan, Prosecuting Attorney, Dominick R. Carnovale, Chief, Appellate Department, and Thomas P. Smith, Assistant Prosecuting Attorney, for the people. I. Goodman Cohen (by Michael S. Friedman), for defendant. *98 Before: V.J. BRENNAN, P.J., and HOLBROOK and VAN VALKENBURG,[*] JJ. HOLBROOK, J. This is an appeal by the defendant Richard Wakefield, by leave granted, from a sentence of 1-1/2 to 2 years for violation of probation, ordered on July 7, 1972. On October 23, 1964, defendant pled guilty to the offense of attempted larceny in a business building contrary to MCLA 750.92; MSA 28.287 and MCLA 750.360; MSA 28.592, a circuit court misdemeanor punishable by a sentence to prison of not to exceed two years. On November 6, 1964, defendant was placed on probation for a term of 2 years, which provided inter alia that defendant was to pay $1 weekly for fine and/or costs and $3 per week for his court-appointed attorney. Notice of probation violation dated November 4, 1966, and apparently filed November 9, 1966, alleged that defendant had paid only $60 on the assessments ordered. An undated warrant for violation of probation signed by the recorder's court judge was apparently filed November 9, 1966. The original record of the recorder's court shows that a hearing in open court was held on November 10, 1966, wherein it is stated: "Request of the probation department that a warrant for violation of probation be issued granted by the court." Nothing appears in the record from that date until June 30, 1972, when it shows: "Defendant arraigned in open court on warrant heretofore issued for violation of probation, court orders *99 hearing set for July 7, 1972, bail fixed at $10,000 with 2 sureties." A hearing was held on July 7, 1972, wherein the defendant pled not guilty and asserted that he had paid the costs to the court. Further, he represented that since payment was made six years earlier he was unable to produce any receipts. Defendant also asserted that it was contrary to due process to proceed against him as a probation violator approximately 5-1/2 years after his probation had terminated. The trial court found that defendant had violated his probation, revoked his probation, and sentenced him to prison. The defendant asserts on appeal that it was improper to proceed against him as a probation violator 5-1/2 years after his probation was terminated. He claims that it was a violation of due process and denial of a speedy trial, In re Evans, 18 Mich. App. 426 (1969), by extending the rule applicable to parole-revocation proceedings to summary proceedings on revocation of probation. People v Hallaway, 39 Mich. App. 74 (1972). This appeal can be disposed of without ruling on the constitutional questions presented. Under the probation statute, MCLA 771.2; MSA 28.1132, the court had authority to place defendant on probation for a maximum period of two years.[1] Such authority did not permit the court to extend the term of probation. People v Marks, 340 Mich. 495, 501 (1954). In the instant case defendant was placed on probation November 6, 1964, and on the same day he signed a receipt for a copy of his probation order. Nothing further was filed in the case until *100 November 9, 1966, when a notice of probation violation and warrant for violation of probation were filed. On November 10, 1966, at a hearing in open court the trial judge granted a request of the probation department for a warrant for violation of probation. In 59 Col L Rev 311, 314 (1959), Legal Aspects of Probation Revocation, it is stated: "If probation has not been revoked and revocation proceedings are not pending at the end of the probation period, the probationer is thereafter free of liability to imprisonment for the crime of which he was convicted." In the case of United States v Hollien, 105 F Supp 987, 988 (WD Mich, 1952), the Court ruled that: "The bench warrant issued by this court for probation violation can be served at any time during his probationary period, and upon a proper hearing and satisfactory proof of such violation, the court can revoke his probation and require him to serve the sentence which was imposed for the offense of which he was convicted." Absent a showing that revocation proceedings were pending at the end of the two-year period of probation, we are constrained to rule that the trial court lost jurisdiction of the defendant and could not thereafter sentence him to prison. Reversed and defendant is discharged from custody. All concurred. NOTES [*] Former circuit judge, sitting on the Court of Appeals by assignment pursuant to Const 1963, art 6, § 23 as amended in 1968. [1] MCLA 750.92(3); MSA 28.287(3). | 10-30-2013 | [
"46 Mich. App. 97 (1973) 207 N.W.2d 461 PEOPLE v. WAKEFIELD Docket No. 14622. Michigan Court of Appeals. Decided March 29, 1973. Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cahalan, Prosecuting Attorney, Dominick R. Carnovale, Chief, Appellate Department, and Thomas P. Smith, Assistant Prosecuting Attorney, for the people. I. Goodman Cohen (by Michael S. Friedman), for defendant. *98 Before: V.J. BRENNAN, P.J., and HOLBROOK and VAN VALKENBURG,[*] JJ. HOLBROOK, J. This is an appeal by the defendant Richard Wakefield, by leave granted, from a sentence of 1-1/2 to 2 years for violation of probation, ordered on July 7, 1972. On October 23, 1964, defendant pled guilty to the offense of attempted larceny in a business building contrary to MCLA 750.92; MSA 28.287 and MCLA 750.360; MSA 28.592, a circuit court misdemeanor punishable by a sentence to prison of not to exceed two years. On November 6, 1964, defendant was placed on probation for a term of 2 years, which provided inter alia that defendant was to pay $1 weekly for fine and/or costs and $3 per week for his court-appointed attorney.",
"Notice of probation violation dated November 4, 1966, and apparently filed November 9, 1966, alleged that defendant had paid only $60 on the assessments ordered. An undated warrant for violation of probation signed by the recorder's court judge was apparently filed November 9, 1966. The original record of the recorder's court shows that a hearing in open court was held on November 10, 1966, wherein it is stated: \"Request of the probation department that a warrant for violation of probation be issued granted by the court.\" Nothing appears in the record from that date until June 30, 1972, when it shows: \"Defendant arraigned in open court on warrant heretofore issued for violation of probation, court orders *99 hearing set for July 7, 1972, bail fixed at $10,000 with 2 sureties.\" A hearing was held on July 7, 1972, wherein the defendant pled not guilty and asserted that he had paid the costs to the court. Further, he represented that since payment was made six years earlier he was unable to produce any receipts.",
"Defendant also asserted that it was contrary to due process to proceed against him as a probation violator approximately 5-1/2 years after his probation had terminated. The trial court found that defendant had violated his probation, revoked his probation, and sentenced him to prison. The defendant asserts on appeal that it was improper to proceed against him as a probation violator 5-1/2 years after his probation was terminated. He claims that it was a violation of due process and denial of a speedy trial, In re Evans, 18 Mich. App.",
"426 (1969), by extending the rule applicable to parole-revocation proceedings to summary proceedings on revocation of probation. People v Hallaway, 39 Mich. App. 74 (1972). This appeal can be disposed of without ruling on the constitutional questions presented. Under the probation statute, MCLA 771.2; MSA 28.1132, the court had authority to place defendant on probation for a maximum period of two years. [1] Such authority did not permit the court to extend the term of probation. People v Marks, 340 Mich. 495, 501 (1954). In the instant case defendant was placed on probation November 6, 1964, and on the same day he signed a receipt for a copy of his probation order. Nothing further was filed in the case until *100 November 9, 1966, when a notice of probation violation and warrant for violation of probation were filed. On November 10, 1966, at a hearing in open court the trial judge granted a request of the probation department for a warrant for violation of probation. In 59 Col L Rev 311, 314 (1959), Legal Aspects of Probation Revocation, it is stated: \"If probation has not been revoked and revocation proceedings are not pending at the end of the probation period, the probationer is thereafter free of liability to imprisonment for the crime of which he was convicted.\"",
"In the case of United States v Hollien, 105 F Supp 987, 988 (WD Mich, 1952), the Court ruled that: \"The bench warrant issued by this court for probation violation can be served at any time during his probationary period, and upon a proper hearing and satisfactory proof of such violation, the court can revoke his probation and require him to serve the sentence which was imposed for the offense of which he was convicted.\" Absent a showing that revocation proceedings were pending at the end of the two-year period of probation, we are constrained to rule that the trial court lost jurisdiction of the defendant and could not thereafter sentence him to prison. Reversed and defendant is discharged from custody.",
"All concurred. NOTES [*] Former circuit judge, sitting on the Court of Appeals by assignment pursuant to Const 1963, art 6, § 23 as amended in 1968. [1] MCLA 750.92(3); MSA 28.287(3)."
] | https://www.courtlistener.com/api/rest/v3/opinions/1228859/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
243 S.E.2d 468 (1978) SCHOOL BOARD OF the CITY OF RICHMOND v. Margaret W. PARHAM et al., etc. Record No. 761561. Supreme Court of Virginia. April 21, 1978. *469 C. Tabor Cronk, Asst. City Atty., for plaintiff in error. Michael W. Smith, William H. Hefty, Richmond (Peter E. Broadbent, Jr.; Anthony F. Troy, Atty. Gen., Walter H. Ryland, Asst. Atty. Gen., Christian, Barton, Epps, Brent & Chappell, Richmond, on briefs), for defendants in error. Before I'ANSON, C. J., and CARRICO, HARRISON, COCHRAN, HARMAN and COMPTON, JJ. CARRICO, Justice. This is an appeal from the final order of the trial court awarding Margaret W. Parham (hereinafter, Parham), a Richmond public schoolteacher, a writ of mandamus against the School Board of the City of Richmond (hereinafter, the School Board). The order compelled the School Board to submit to arbitration a grievance Parham had brought pursuant to the "Procedure for Adjusting Grievances," adopted by the State Board of Education (hereinafter, the State Board). The same order awarded the State Board, an intervenor in the proceeding, a declaratory judgment upholding the constitutionality of a provision of the Procedure which requires binding arbitration of certain disputes between local school boards and their non-supervisory employees. The sole question for decision is whether the provision for binding arbitration is constitutionally valid. Adopted in 1973 and subsequently amended, the Procedure prescribes the method for settling employee grievances. A grievance is defined as a difference or dispute concerning "the application of the provisions of the [local school board's] Policies, Rules and Regulations as they affect the work activity of [non-supervisory employees]."[1] In a step-by-step process provided by the Procedure, an employee may submit a dispute successively to the immediate supervisor, the school principal, the division superintendent, and the local school board. Failing resolution of the dispute at these levels, the employee may appeal the matter to an arbitration panel which, after a de novo hearing, renders a decision in the case. An arbitration panel consists of one member chosen by the employee and one selected by the school board. If these two cannot resolve the dispute, they choose a third panelist. According to the terms of the Procedure, an arbitration panel's jurisdiction is "confined exclusively to the application of the provision or provisions of the [local school board's] Policies, Rules and Regulations at issue between the employee and the [local school board];" the panel has "no authority to add to, detract from or amend any such provision or provisions." And, in a section entitled "Board's Prerogatives," it is stated that nothing in the Procedure is intended to "circumscribe or modify" the right of the local school board to exercise eight listed functions.[2] The same section provides further, however, that should "a disagreement arise over whether a grievance concerns one or more of the [local school board's] prerogatives. . . the question of the arbitrability *470 of such grievance shall itself be a matter within the jurisdiction of the Panel described in . . . this Procedure." Lastly, the Procedure contains this pertinent provision: "The award of the Panel on the merits of any grievance adjudicated within its jurisdiction and authority as specified herein shall be final and binding on the aggrieved employee and the [local school board] and the [local school board] hereby delegates such authority to the Panel." In the present case, Parham unsuccessfully processed her grievance through the several administrative levels prescribed by the Procedure and ultimately presented the dispute to the School Board, where she received an adverse decision. When she called for arbitration, the School Board refused to arbitrate, stating that it questioned the constitutionality of the Procedure "insofar as it compels arbitration binding on school boards in Virginia." Parham then filed her petition for a writ of mandamus to compel the School Board to submit the matter to arbitration. At the heart of the present controversy are the provisions of Article VIII of the Virginia Constitution, which article relates to education. In pertinent part, the article reads: ". . . "§ 2. Standards of quality; State and local support of public schools.Standards of quality for the several school divisions shall be determined and prescribed from time to time by the Board of Education, subject to revision only by the General Assembly. ". . . "§ 4. Board of Education.The general supervision of the public school system shall be vested in a Board of Education . . . . "§ 5. Powers and duties of the Board of Education.The powers and duties of the Board of Education shall be as follows: ". . . "(e) Subject to the ultimate authority of the General Assembly, the Board shall have primary responsibility and authority for effectuating the educational policy set forth in this Article, and it shall have such other powers and duties as may be prescribed by law. ". . . "§ 7. School boards.The supervision of schools in each school division shall be vested in a school board . . . ." The School Board recognizes that § 4 of Article VIII places "general supervision" of the public school system in the hands of the State Board. The School Board notes, however, that, under § 7 of Article VIII, the "supervision" of schools is vested in local school boards and that, implementing this constitutional mandate, the General Assembly has conferred upon such local boards extensive authority to execute their supervisory duties.[3] The School Board acknowledges that, within the general supervision/supervision format of §§ 4 and 7 of Article VIII, the General Assembly may "apportion various supervisory powers over the school system and schools, respectively, between the State Board and local school boards." And the School Board concedes that it must observe not only the standards of quality prescribed by the State Board, as revised by the General Assembly, but also the lawful regulations of the State Board. The School Board argues, however, that "management of a school board's teaching *471 staff and other employees is . . . an essential function of supervision" and that neither the General Assembly nor the State Board can divest local school boards of this function and place it "in an authority other than the local boards." Yet, the School Board asserts, the effect of the binding arbitration provision of the Procedure is to permit "an outside agency, in the form of an arbitration panel . . . to divest the local board of its essential function by the substitution of [the panel's] judgment for that of the board." As a result of the panel's action, the School Board maintains, a local school board's policies, rules, and regulations relating to the work activity of employees could be altered or rendered meaningless. This, the School Board concludes, is constitutionally impermissible under § 7 of Article VIII. On the other hand, Parham and the State Board contend that the constitutionality of the Procedure should be upheld as a standard of quality enunciated pursuant to § 2 of Article VIII. These parties contend also that the Procedure is constitutionally valid as a rule or regulation adopted pursuant to the general supervisory power of the State Board vested by § 4 and the ultimate authority of the State Board to effectuate the educational policy of the state granted by § 5(e). Furthermore, it is asserted, the General Assembly not only has conferred upon the State Board full authority to adopt the Procedure either as a rule or regulation or as a standard of quality[4] but also has itself "enacted" or "ratified" the Procedure.[5] As a result of this legislative action, it is maintained, the Procedure is entitled to a presumption of constitutional validity. The Procedure, Parham and the State Board argue, does not divest a local school board of any of its powers of supervision; the Procedure preserves the local board's authority to make its own policies, rules, and regulations and to administer the mission of the schools. The Procedure, it is asserted, comes into effect only after the local board has exercised its supervisory powers, and even then the Procedure amounts to no more than a "device" with which to contest a misapplication of a policy, rule, or regulation. In analyzing the arguments of Parham and the State Board, it is interesting to note that neither of these parties specifically defends the binding arbitration provision of the Procedure; the arguments merely assert the validity of the Procedure in general. The closest approach to a defense of the provision is a statement that "the arbitration panel has no authority whatsoever to make or enforce any decisions as to how the local school is to be operated." This merely evades, rather than answers, the *472 School Board's contention that the arbitration provision permits "an outside agency, in the form of an arbitration panel . . . to divest the local board of its essential function [of managing its teaching staff] by the substitution of [the panel's] judgment for that of the board." This contention of the School Board presents the real question in the case, viz., whether the binding arbitration provision of the Procedure produces an unlawful delegation of power. In resolving this question, we will assume the correctness of the position stated by Parham and the State Board that the General Assembly, by its revision of standards of quality in 1973, 1974, and 1976 (note 5), "enacted" or "ratified" the Procedure. And, based upon this assumption, we will accord the Procedure a presumption of constitutional validity. But the presumption would be unavailing against a finding that the Procedure results in an unlawful delegation of authority. There can be no doubt that a delegation of power is involved in the binding arbitration provision. Indeed, the very section of the Procedure which provides that an arbitration panel shall have authority to make a final and binding decision also states that the local school board "hereby delegates such authority to the Panel." Whether, however, the arbitration provision results in an unlawful delegation of authority is a more difficult question. Previously, we have encountered binding arbitration provisions concerning public school employees only as part of collective bargaining agreements entered into by a local school board and certain labor organizations. In Commonwealth v. Arlington County Board, 217 Va. 558, 232 S.E.2d 30 (1977), we held, inter alia, that, because the power to enter into collective bargaining agreements was not indispensable to the discharge of the functions of a local school board, we could not imply such authority from the power of supervision vested by § 7 of Article VIII of the Constitution. Having determined, in the final analysis, that the local board possessed neither constitutional nor statutory authority to enter into the agreements, we stated specifically that we did not reach the question whether the agreements produced an unlawful delegation of power. Although not involving binding arbitration provisions, Howard v. School Board of Alleghany County, 203 Va. 55, 122 S.E.2d 891 (1961), is pertinent to resolution of the present case. There, a state statute required the sale of school property if such disposition was favored by a majority of voters in a referendum. Ruling the statute invalid, we said that it was an "essential function" of a local school board's power of supervision, granted by what is now § 7 of Article VIII of the Constitution, "to determine whether a particular property is needed for school purposes and the manner in which it shall be used." The effect of the disputed statute, we stated, was "to divest the board of the exercise of that function and lodge it in the electorate," thus stripping the board "of any or all authority to exercise its judgment in the matter." 203 Va. at 58, 122 S.E.2d at 894. This is but another way of saying that the statute produced an unlawful delegation of power. We believe the binding arbitration provision involved in the present case has the same effect as the offending statute in Howard, viz., to remove from a local school board and transfer to others a function essential and indispensable to the exercise of the power of supervision vested by § 7 of Article VIII. The function involved here concerns the application of local policies, rules, and regulations adopted for the day-to-day management of a teaching staff. Clearly, in the Article VIII general supervision/supervision allocation of powers between the State Board and local school boards, this function is vested in the local boards. It would be wholly unrealistic to say that Article VIII was designed to inject the State Board directly into the daily management of a local teaching staff. Recognizing this proposition and implementing § 7 of Article VIII, the General Assembly has placed the management of local teaching staffs in local school boards. (See note 3 and Code § 22-72). *473 Equally clear, the function of applying local policies, rules, and regulations, adopted for the management of a teaching staff, is a function essential and indispensable to exercise of the power of supervision vested by § 7 of Article VIII.[6] This power of supervision would be an empty one, indeed, if a local school board, once having adopted a valid policy, rule, or regulation, found itself powerless to enforce what it had promulgated. In the present case, no question is raised concerning the validity of the policy adopted by the School Board and disputed by Parham. No complaint is made that, in adopting the policy, the School Board exceeded its authority in any way. Nor is it claimed that the policy conflicts with law or is contrary to any standard of quality or rule or regulation adopted by the State Board.[7] Yet, the binding arbitration provision of the Procedure denies the School Board the right to decide upon the ultimate application of the policy. The provision effectively divests the School Board of a function indispensable to its § 7 power of supervision and transfers to an arbitration panel the authority to make a final and binding decision upon the application of the policy. We conclude, therefore, that the binding arbitration provision of the Procedure produces an unlawful delegation of power, violative of § 7 of Article VIII of the Constitution. In reaching this conclusion, we have not been unmindful of the authority placed in the State Board by other portions of Article VIII or of the rule that all parts of the Constitution should be harmonized to effectuate the intention expressed within the four corners of the instrument. The several provisions of Article VIII would not be harmonized, however, by an interpretation which would so magnify the authority of the State Board that, as a result, the § 7 power of local supervision would be rendered meaningless. Our conclusion with respect to the binding arbitration provision of the Procedure avoids such a result in the present case. Accordingly, the judgment of the trial court will be reversed, Parham's petition for a writ of mandamus will be dismissed, and final judgment will be entered here declaring the binding arbitration provision of the Procedure constitutionally invalid. Reversed and final judgment. NOTES [1] Under the terms of the Procedure, the discharge of an employee, the failure to reappoint an employee during a probationary period, and the revocation, suspension, or denial of a teaching certificate are not subject to the Procedure. [2] The listed functions are:
"(a) Determine and administer the mission of the school system; "(b) Hire, promote, transfer, discipline, suspend, assign and retain employees in positions within the school system; "(c) Maintain the efficiency of school operations; "(d) Relieve employees from duties for legitimate reasons; "(e) Take action as may be necessary to carry out the duties of the school system in emergencies; "(f) Determine the methods, means and personnel by which operations are to be carried on; "(g) Direct the work of [local school board] employees; "(h) Issue and revise policies, rules and regulations necessary to carry out the foregoing and all other managerial functions entrusted to and conferred upon the [local school board] by law . . . ." [3] Under Code § 22-93, a city school board shall establish and maintain a public school system "in accordance with the requirements of the Constitution and the general educational policy of the Commonwealth." Under Code § 22-97, a city school board has the power and duty: to "explain, enforce, and observe the school laws, and to make rules for the government of the schools;" to "determine the studies to be pursued, the methods of teaching [and] the government to be employed in the schools;" to "employ teachers on recommendation of the division superintendent and to dismiss them when delinquent, inefficient or in anywise unworthy of the position;" to "visit the . . . schools. . . and to take care that they are conducted according to law, and with the utmost efficiency;" and to "perform such other duties as shall be prescribed by the State Board or are imposed by other parts of this title." [4] Under Code § 22-19, the State Board may "make rules and regulations not inconsistent with law for the management and conduct of schools" and, except as provided in § 22-19.1, such rules and regulations "shall have the force and effect of law." Under § 22-19.1, the State Board is directed to submit to the General Assembly periodic reports containing the standards of quality "to be prescribed in the future" for school divisions. The standards, subject to revision by the General Assembly, shall be effective for periods specified in the statute. [5] Acts 1973, ch. 311, provided that "the standards of quality for public schools in Virginia, as determined and prescribed by the Board of Education, are revised" as follows:
". . . "3. Guidelines for Teacher-AdministratorSchool Board Relationships "a. The School Board of each school division shall adopt the procedure prescribed by the Board of Education for adjusting grievances." Acts 1974, ch. 316, revised the standards of quality adopted by the State Board effective July 1, 1974, as follows: ". . . "9. Policy Manual. Each school division shall maintain an up-to-date policy manual which shall include: "a. The grievance procedure prescribed by the Board of Education . . . ." Acts 1976, ch. 714, revised the standards of quality adopted by the State Board effective July 1, 1976, as follows: ". . . "10POLICY MANUAL "Each school division shall maintain an upto-date policy manual which shall include: "1. A grievance procedure prescribed, and amended from time to time as deemed necessary, by the Board of Education . . . ." [6] The School Board requests us to abandon the "essential-indispensable function" test employed in Howard and Arlington County Board in favor of an approach which recognizes that § 7 of Article VIII encompasses any function, "essential . . . or otherwise," related to the supervision of schools. Because, however, we are satisfied that the function involved here is essential and indispensable, we need not consider the request in this case. [7] Citing DeFebio v. County School Board of Fairfax County, 199 Va. 511, 100 S.E.2d 760 (1957), appeal dismissed, 357 U.S. 218, 78 S. Ct. 1363, 2 L. Ed. 2d 1361 (1958), Parham argues that the Constitution "does not define `supervision' to include the right of a local school board to enact a grievance procedure only according to its wishes" or to allow "local school boards to ignore a grievance procedure adopted by the State Board." We fail to see the relevance of this argument. Aside from the fact that the School Board does not assert the right "to enact a grievance procedure only according to its wishes," the School Board did not ignore the Procedure but refused to arbitrate Parham's grievance only because it questioned the constitutionality of the binding arbitration provision of the Procedure. Today's decision vindicates the School Board's position. | 10-30-2013 | [
"243 S.E.2d 468 (1978) SCHOOL BOARD OF the CITY OF RICHMOND v. Margaret W. PARHAM et al., etc. Record No. 761561. Supreme Court of Virginia. April 21, 1978. *469 C. Tabor Cronk, Asst. City Atty., for plaintiff in error. Michael W. Smith, William H. Hefty, Richmond (Peter E. Broadbent, Jr.; Anthony F. Troy, Atty. Gen., Walter H. Ryland, Asst. Atty. Gen., Christian, Barton, Epps, Brent & Chappell, Richmond, on briefs), for defendants in error. Before I'ANSON, C. J., and CARRICO, HARRISON, COCHRAN, HARMAN and COMPTON, JJ. CARRICO, Justice. This is an appeal from the final order of the trial court awarding Margaret W. Parham (hereinafter, Parham), a Richmond public schoolteacher, a writ of mandamus against the School Board of the City of Richmond (hereinafter, the School Board). The order compelled the School Board to submit to arbitration a grievance Parham had brought pursuant to the \"Procedure for Adjusting Grievances,\" adopted by the State Board of Education (hereinafter, the State Board).",
"The same order awarded the State Board, an intervenor in the proceeding, a declaratory judgment upholding the constitutionality of a provision of the Procedure which requires binding arbitration of certain disputes between local school boards and their non-supervisory employees. The sole question for decision is whether the provision for binding arbitration is constitutionally valid. Adopted in 1973 and subsequently amended, the Procedure prescribes the method for settling employee grievances.",
"A grievance is defined as a difference or dispute concerning \"the application of the provisions of the [local school board's] Policies, Rules and Regulations as they affect the work activity of [non-supervisory employees]. \"[1] In a step-by-step process provided by the Procedure, an employee may submit a dispute successively to the immediate supervisor, the school principal, the division superintendent, and the local school board. Failing resolution of the dispute at these levels, the employee may appeal the matter to an arbitration panel which, after a de novo hearing, renders a decision in the case. An arbitration panel consists of one member chosen by the employee and one selected by the school board.",
"If these two cannot resolve the dispute, they choose a third panelist. According to the terms of the Procedure, an arbitration panel's jurisdiction is \"confined exclusively to the application of the provision or provisions of the [local school board's] Policies, Rules and Regulations at issue between the employee and the [local school board];\" the panel has \"no authority to add to, detract from or amend any such provision or provisions.\" And, in a section entitled \"Board's Prerogatives,\" it is stated that nothing in the Procedure is intended to \"circumscribe or modify\" the right of the local school board to exercise eight listed functions.",
"[2] The same section provides further, however, that should \"a disagreement arise over whether a grievance concerns one or more of the [local school board's] prerogatives. . . the question of the arbitrability *470 of such grievance shall itself be a matter within the jurisdiction of the Panel described in . . . this Procedure.\" Lastly, the Procedure contains this pertinent provision: \"The award of the Panel on the merits of any grievance adjudicated within its jurisdiction and authority as specified herein shall be final and binding on the aggrieved employee and the [local school board] and the [local school board] hereby delegates such authority to the Panel.\" In the present case, Parham unsuccessfully processed her grievance through the several administrative levels prescribed by the Procedure and ultimately presented the dispute to the School Board, where she received an adverse decision.",
"When she called for arbitration, the School Board refused to arbitrate, stating that it questioned the constitutionality of the Procedure \"insofar as it compels arbitration binding on school boards in Virginia.\" Parham then filed her petition for a writ of mandamus to compel the School Board to submit the matter to arbitration. At the heart of the present controversy are the provisions of Article VIII of the Virginia Constitution, which article relates to education. In pertinent part, the article reads: \". . . \"§ 2. Standards of quality; State and local support of public schools.Standards of quality for the several school divisions shall be determined and prescribed from time to time by the Board of Education, subject to revision only by the General Assembly. \".",
". . \"§ 4. Board of Education.The general supervision of the public school system shall be vested in a Board of Education . . . . \"§ 5. Powers and duties of the Board of Education.The powers and duties of the Board of Education shall be as follows: \". . . \"(e) Subject to the ultimate authority of the General Assembly, the Board shall have primary responsibility and authority for effectuating the educational policy set forth in this Article, and it shall have such other powers and duties as may be prescribed by law. \". . . \"§ 7. School boards.The supervision of schools in each school division shall be vested in a school board . . . .\" The School Board recognizes that § 4 of Article VIII places \"general supervision\" of the public school system in the hands of the State Board.",
"The School Board notes, however, that, under § 7 of Article VIII, the \"supervision\" of schools is vested in local school boards and that, implementing this constitutional mandate, the General Assembly has conferred upon such local boards extensive authority to execute their supervisory duties. [3] The School Board acknowledges that, within the general supervision/supervision format of §§ 4 and 7 of Article VIII, the General Assembly may \"apportion various supervisory powers over the school system and schools, respectively, between the State Board and local school boards.\" And the School Board concedes that it must observe not only the standards of quality prescribed by the State Board, as revised by the General Assembly, but also the lawful regulations of the State Board. The School Board argues, however, that \"management of a school board's teaching *471 staff and other employees is .",
". . an essential function of supervision\" and that neither the General Assembly nor the State Board can divest local school boards of this function and place it \"in an authority other than the local boards.\" Yet, the School Board asserts, the effect of the binding arbitration provision of the Procedure is to permit \"an outside agency, in the form of an arbitration panel . . . to divest the local board of its essential function by the substitution of [the panel's] judgment for that of the board.\" As a result of the panel's action, the School Board maintains, a local school board's policies, rules, and regulations relating to the work activity of employees could be altered or rendered meaningless. This, the School Board concludes, is constitutionally impermissible under § 7 of Article VIII.",
"On the other hand, Parham and the State Board contend that the constitutionality of the Procedure should be upheld as a standard of quality enunciated pursuant to § 2 of Article VIII. These parties contend also that the Procedure is constitutionally valid as a rule or regulation adopted pursuant to the general supervisory power of the State Board vested by § 4 and the ultimate authority of the State Board to effectuate the educational policy of the state granted by § 5(e). Furthermore, it is asserted, the General Assembly not only has conferred upon the State Board full authority to adopt the Procedure either as a rule or regulation or as a standard of quality[4] but also has itself \"enacted\" or \"ratified\" the Procedure. [5] As a result of this legislative action, it is maintained, the Procedure is entitled to a presumption of constitutional validity. The Procedure, Parham and the State Board argue, does not divest a local school board of any of its powers of supervision; the Procedure preserves the local board's authority to make its own policies, rules, and regulations and to administer the mission of the schools. The Procedure, it is asserted, comes into effect only after the local board has exercised its supervisory powers, and even then the Procedure amounts to no more than a \"device\" with which to contest a misapplication of a policy, rule, or regulation.",
"In analyzing the arguments of Parham and the State Board, it is interesting to note that neither of these parties specifically defends the binding arbitration provision of the Procedure; the arguments merely assert the validity of the Procedure in general. The closest approach to a defense of the provision is a statement that \"the arbitration panel has no authority whatsoever to make or enforce any decisions as to how the local school is to be operated.\"",
"This merely evades, rather than answers, the *472 School Board's contention that the arbitration provision permits \"an outside agency, in the form of an arbitration panel . . . to divest the local board of its essential function [of managing its teaching staff] by the substitution of [the panel's] judgment for that of the board.\" This contention of the School Board presents the real question in the case, viz., whether the binding arbitration provision of the Procedure produces an unlawful delegation of power. In resolving this question, we will assume the correctness of the position stated by Parham and the State Board that the General Assembly, by its revision of standards of quality in 1973, 1974, and 1976 (note 5), \"enacted\" or \"ratified\" the Procedure.",
"And, based upon this assumption, we will accord the Procedure a presumption of constitutional validity. But the presumption would be unavailing against a finding that the Procedure results in an unlawful delegation of authority. There can be no doubt that a delegation of power is involved in the binding arbitration provision. Indeed, the very section of the Procedure which provides that an arbitration panel shall have authority to make a final and binding decision also states that the local school board \"hereby delegates such authority to the Panel.\" Whether, however, the arbitration provision results in an unlawful delegation of authority is a more difficult question. Previously, we have encountered binding arbitration provisions concerning public school employees only as part of collective bargaining agreements entered into by a local school board and certain labor organizations. In Commonwealth v. Arlington County Board, 217 Va. 558, 232 S.E.2d 30 (1977), we held, inter alia, that, because the power to enter into collective bargaining agreements was not indispensable to the discharge of the functions of a local school board, we could not imply such authority from the power of supervision vested by § 7 of Article VIII of the Constitution.",
"Having determined, in the final analysis, that the local board possessed neither constitutional nor statutory authority to enter into the agreements, we stated specifically that we did not reach the question whether the agreements produced an unlawful delegation of power. Although not involving binding arbitration provisions, Howard v. School Board of Alleghany County, 203 Va. 55, 122 S.E.2d 891 (1961), is pertinent to resolution of the present case. There, a state statute required the sale of school property if such disposition was favored by a majority of voters in a referendum. Ruling the statute invalid, we said that it was an \"essential function\" of a local school board's power of supervision, granted by what is now § 7 of Article VIII of the Constitution, \"to determine whether a particular property is needed for school purposes and the manner in which it shall be used.\"",
"The effect of the disputed statute, we stated, was \"to divest the board of the exercise of that function and lodge it in the electorate,\" thus stripping the board \"of any or all authority to exercise its judgment in the matter.\" 203 Va. at 58, 122 S.E.2d at 894. This is but another way of saying that the statute produced an unlawful delegation of power. We believe the binding arbitration provision involved in the present case has the same effect as the offending statute in Howard, viz., to remove from a local school board and transfer to others a function essential and indispensable to the exercise of the power of supervision vested by § 7 of Article VIII. The function involved here concerns the application of local policies, rules, and regulations adopted for the day-to-day management of a teaching staff.",
"Clearly, in the Article VIII general supervision/supervision allocation of powers between the State Board and local school boards, this function is vested in the local boards. It would be wholly unrealistic to say that Article VIII was designed to inject the State Board directly into the daily management of a local teaching staff. Recognizing this proposition and implementing § 7 of Article VIII, the General Assembly has placed the management of local teaching staffs in local school boards. (See note 3 and Code § 22-72). *473 Equally clear, the function of applying local policies, rules, and regulations, adopted for the management of a teaching staff, is a function essential and indispensable to exercise of the power of supervision vested by § 7 of Article VIII. [6] This power of supervision would be an empty one, indeed, if a local school board, once having adopted a valid policy, rule, or regulation, found itself powerless to enforce what it had promulgated. In the present case, no question is raised concerning the validity of the policy adopted by the School Board and disputed by Parham. No complaint is made that, in adopting the policy, the School Board exceeded its authority in any way.",
"Nor is it claimed that the policy conflicts with law or is contrary to any standard of quality or rule or regulation adopted by the State Board. [7] Yet, the binding arbitration provision of the Procedure denies the School Board the right to decide upon the ultimate application of the policy. The provision effectively divests the School Board of a function indispensable to its § 7 power of supervision and transfers to an arbitration panel the authority to make a final and binding decision upon the application of the policy. We conclude, therefore, that the binding arbitration provision of the Procedure produces an unlawful delegation of power, violative of § 7 of Article VIII of the Constitution. In reaching this conclusion, we have not been unmindful of the authority placed in the State Board by other portions of Article VIII or of the rule that all parts of the Constitution should be harmonized to effectuate the intention expressed within the four corners of the instrument.",
"The several provisions of Article VIII would not be harmonized, however, by an interpretation which would so magnify the authority of the State Board that, as a result, the § 7 power of local supervision would be rendered meaningless. Our conclusion with respect to the binding arbitration provision of the Procedure avoids such a result in the present case. Accordingly, the judgment of the trial court will be reversed, Parham's petition for a writ of mandamus will be dismissed, and final judgment will be entered here declaring the binding arbitration provision of the Procedure constitutionally invalid.",
"Reversed and final judgment. NOTES [1] Under the terms of the Procedure, the discharge of an employee, the failure to reappoint an employee during a probationary period, and the revocation, suspension, or denial of a teaching certificate are not subject to the Procedure. [2] The listed functions are: \"(a) Determine and administer the mission of the school system; \"(b) Hire, promote, transfer, discipline, suspend, assign and retain employees in positions within the school system; \"(c) Maintain the efficiency of school operations; \"(d) Relieve employees from duties for legitimate reasons; \"(e) Take action as may be necessary to carry out the duties of the school system in emergencies; \"(f) Determine the methods, means and personnel by which operations are to be carried on; \"(g) Direct the work of [local school board] employees; \"(h) Issue and revise policies, rules and regulations necessary to carry out the foregoing and all other managerial functions entrusted to and conferred upon the [local school board] by law . . .",
".\" [3] Under Code § 22-93, a city school board shall establish and maintain a public school system \"in accordance with the requirements of the Constitution and the general educational policy of the Commonwealth.\" Under Code § 22-97, a city school board has the power and duty: to \"explain, enforce, and observe the school laws, and to make rules for the government of the schools;\" to \"determine the studies to be pursued, the methods of teaching [and] the government to be employed in the schools;\" to \"employ teachers on recommendation of the division superintendent and to dismiss them when delinquent, inefficient or in anywise unworthy of the position;\" to \"visit the . . . schools. . . and to take care that they are conducted according to law, and with the utmost efficiency;\" and to \"perform such other duties as shall be prescribed by the State Board or are imposed by other parts of this title.\"",
"[4] Under Code § 22-19, the State Board may \"make rules and regulations not inconsistent with law for the management and conduct of schools\" and, except as provided in § 22-19.1, such rules and regulations \"shall have the force and effect of law.\" Under § 22-19.1, the State Board is directed to submit to the General Assembly periodic reports containing the standards of quality \"to be prescribed in the future\" for school divisions. The standards, subject to revision by the General Assembly, shall be effective for periods specified in the statute. [5] Acts 1973, ch. 311, provided that \"the standards of quality for public schools in Virginia, as determined and prescribed by the Board of Education, are revised\" as follows: \". . . \"3. Guidelines for Teacher-AdministratorSchool Board Relationships \"a.",
"The School Board of each school division shall adopt the procedure prescribed by the Board of Education for adjusting grievances.\" Acts 1974, ch. 316, revised the standards of quality adopted by the State Board effective July 1, 1974, as follows: \". . . \"9. Policy Manual. Each school division shall maintain an up-to-date policy manual which shall include: \"a. The grievance procedure prescribed by the Board of Education . . . .\" Acts 1976, ch. 714, revised the standards of quality adopted by the State Board effective July 1, 1976, as follows: \". . .",
"\"10POLICY MANUAL \"Each school division shall maintain an upto-date policy manual which shall include: \"1. A grievance procedure prescribed, and amended from time to time as deemed necessary, by the Board of Education . . . .\" [6] The School Board requests us to abandon the \"essential-indispensable function\" test employed in Howard and Arlington County Board in favor of an approach which recognizes that § 7 of Article VIII encompasses any function, \"essential . . . or otherwise,\" related to the supervision of schools. Because, however, we are satisfied that the function involved here is essential and indispensable, we need not consider the request in this case.",
"[7] Citing DeFebio v. County School Board of Fairfax County, 199 Va. 511, 100 S.E.2d 760 (1957), appeal dismissed, 357 U.S. 218, 78 S. Ct. 1363, 2 L. Ed. 2d 1361 (1958), Parham argues that the Constitution \"does not define `supervision' to include the right of a local school board to enact a grievance procedure only according to its wishes\" or to allow \"local school boards to ignore a grievance procedure adopted by the State Board.\" We fail to see the relevance of this argument. Aside from the fact that the School Board does not assert the right \"to enact a grievance procedure only according to its wishes,\" the School Board did not ignore the Procedure but refused to arbitrate Parham's grievance only because it questioned the constitutionality of the binding arbitration provision of the Procedure.",
"Today's decision vindicates the School Board's position."
] | https://www.courtlistener.com/api/rest/v3/opinions/1416550/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Justice BAER, concurring and dissenting. While I join nearly all of the reasoning of the thorough majority opinion, I am compelled to dissent from sub-part F(2), “Suitability of Character,” and thus from the ultimate decision affirming the Gaming Control Board’s (“Board”) grant of a Category 3 slot machine license to Woodlands Fayette, LLC (“Woodlands”). The part to which I dissent involves the confidential, sealed portion of the record. As I am able to discuss the legal claims involved in general terms, as does the Majority Opinion, I will not spread information the Board deemed confidential on the public record. Appellant Mason-Dixon essentially asserts that the Board capriciously disregarded evidence of potential criminal conduct when it concluded that the Woodlands’ principals demonstrated character suitability by clear and convincing evidence as required by 4 Pa.C.S. § 1310(a).1 As described by the Majority, Appellant “refers to allegations of wrongdoing by a principal of Woodlands, specifically Joseph Hardy, the crux of which was determined to be unsupported, and all records of the alleged incident were expunged. No criminal prosecution was pursued and no conviction resulted.” Maj. Op. at 1113. Crucially, however, the Majority fails to discuss the allegation that a state trooper associated with the Woodlands’ principals attempted to interfere with the investigation of the criminal complaint against Hardy. My review of the Board’s consideration of these allegations is colored by my reading of the report issued by the Thirty-First Statewide Investigating Grand Jury, filed May 19, 2011, and released to *1115the public on May 24, 2011. While the Grand Jury Report does not relate specifically to the licensing decision in this case, the report nonetheless provides insight into the short-comings of the Board’s procedures generally, emphasizing that the specific cases discussed were merely “the best examples of problems and failures that extended throughout the application and licensing process in all the license categories.” Grand Jury Report No. 1 (“GJR”) at 38. Moreover, some of the most serious criticisms leveled against the Board involved the process of reviewing the suitability of applicants’ principals, which is my primary concern in the case at bar. Specifically, the Grand Jury found that “the Board failed to carefully evaluate several applicants’ suitability and its own administrative practices placed the burden of establishing an applicant’s unsuitability beyond all doubt squarely on the Bureau of Investigation and Enforcement” (“BIE”) in direct contrast to the Gaming Act’s requirement that the applicant prove suitability by clear and convincing evidence. Id. at 23; see also 4 Pa.C.S. § 1310(a). Particularly concerning in light of the issues presented in this case, the Grand Jury concluded: [N]umerous investigators testified or provided information regarding their concerns that they were prevented from fully investigating and pursuing legitimate concerns regarding an applicant’s character. Investigators also detailed how information they acquired was not adequately presented to the Board in the final suitability reports prepared by the Bureau of Licensing, and the applicant’s burden of establishing good character by clear and convincing evidence was shifted to the investigators. This created a huge loophole in the thoroughness and accuracy of the BIE information getting to the Board, especially areas of concern found throughout BIE investigations. GJR at 39-40; see also id. at 41 (“Despite their best efforts, [investigators] were instructed not to conduct particular interviews, were prevented from requesting additional information from the applicant, and ultimately reliable and verified information was not presented to the Board in the final suitability report.”). In discussing why certain investigatory information was removed from reports presented to the Board, the Chief Enforcement Counsel to the Board explained that “the goal with regard to the suitability reports was to secure stipulation from the other side, from the applicant, as to its admissibility and making it part of the record.” Id. at 57.2 If a stipulation was not secured, the investigators had to demonstrate absolute proof of the questioned piece of information for it to be included in the final report to the Board. The Grand Jury observed that the BIE seemed more concerned with the sensitivity of the applicant rather than with investigating the merits of the allegations, despite the Gaming Act’s placement of the burden on the applicant to establish its suitability by clear and convincing evidence. Id. at 57. I believe this Court must consider the allegations raised in this case in light of the disturbing criticisms made by the Grand Jury concerning the Board’s character suitability review process. Specifically, Mason-Dixon alleges that the Board inadequately investigated the allegations against the Woodlands’ principals during an executive session in November 2010 regarding the criminal complaint against Mr. Hardy and the allegation of interference with the criminal investigation involv*1116ing that complaint. My review of the closed executive session confirms Mason-Dixon’s concerns in regard to the interference allegation. It appears that at the Board’s executive session the representative of the Office of Enforcement Counsel (“OEC”) relied exclusively on assertions of the Woodlands’ principals in affidavits, very brief testimony, and on the assumption that the fear of other criminal prosecution was sufficient to protect against the principals perjuring themselves before the Board. It is not clear whether the OEC or the BIE attempted to contact anyone other than the Woodlands’ principals. Given the Grand Jury’s findings that the investigators were often prevented from performing thorough investigations and that the information they did gather was not always passed on to the Board, I am particularly disturbed by the cursory investigation into alleged interference with a criminal investigation. Notwithstanding BIE’s seemingly obvious failure to investigate fully the allegations in this case, the record reveals that the Board accepted BIE’s investigation as sufficient. I find that conclusion is not supported by the current record, especially considering that the Gaming Act requires the applicant to prove suitability by clear and convincing evidence. See 4 Pa.C.S. § 1310(a). Even if it is eventually determined that the principals did not interfere with the criminal investigation, the Board must base its conclusion of character suitability on more than self-serving affidavits, very brief testimony, and the belief that if the parties were lying they would have more to worry about than the denial of a gaming license. While I recognize that the Gaming Act provides for confidentiality of information submitted by applicants or obtained by the BIE or the Board for purposes of character suitability review, I nonetheless believe that such confidentiality places a duty on the Board to probe and assess the accuracy of this information that is not otherwise subject to public scrutiny. 4 Pa.C.S. § 1206(f), 1310(a). The Board cannot act as a rubber stamp for character suitability but must instead conduct a thorough and searching inquiry to determine whether an applicant has proven its principal’s character suitability by clear and convincing evidence. I find the Board’s review in this case to be a wholly unsatisfactory protection of the taxpayers of Pennsylvania from concerns that potential holders of a gaming license might attempt to influence criminal investigations in the future. The absence of a full investigation and inquiry is particularly concerning given that two former Pennsylvania State Police troopers brought a lawsuit against the State Police alleging that they were subject to discriminatory and illegal employment practices in retaliation for their reporting and investigation of the allegation that the state trooper associated with the Woodlands’ principals attempted to interfere with the Hardy criminal investigation. The State Police settled this lawsuit for $675,000, which in my view, lends credence to the allegation that some individuals were attempting to benefit Mr. Hardy and the Woodlands by interfering with the police investigation. While the Majority finds neither a violation of the prudent man rule nor a capricious disregard of the evidence, I am unable to agree. We have no ability to know what was investigated by the BIE or what was found by the investigators and not turned over to the Board, because the Board did not ask the necessary questions to determine the suitability by clear and convincing evidence. Accordingly, I dissent from the affirmance of the grant of the Category 3 slot machine license to Woodlands Fayette, LLC. Instead, I would remand for a proper investigation into the allegations against the principals in this *1117case. I emphasize, however, that I make no determination regarding the ultimate character suitability, leaving that determination, at least in the first instance, to the Board following sufficient investigation and inquiry. Justice TODD joins this opinion.
. § 1310, Slot machine license application character requirements (a) Application.-— (1) Every application for a slot machine license shall include such information, documentation and assurances as may be required to establish by clear and convincing evidence the applicant's suitability, including good character, honesty and integrity. Information shall include, without limitation, information pertaining to family, habits, character, reputation, criminal history background, business activities, financial affairs and business, professional and personal associates, covering at least the ten-year period immediately preceding the filing date of the application. 4 Pa.C.S. § 1310(a)(1).
. Indeed, the report quotes the Chief Enforcement Counsel as saying that “it’s our job to take people and companies that are unsuitable and make them suitable.” Id. at 45. | 09-24-2021 | [
"Justice BAER, concurring and dissenting. While I join nearly all of the reasoning of the thorough majority opinion, I am compelled to dissent from sub-part F(2), “Suitability of Character,” and thus from the ultimate decision affirming the Gaming Control Board’s (“Board”) grant of a Category 3 slot machine license to Woodlands Fayette, LLC (“Woodlands”). The part to which I dissent involves the confidential, sealed portion of the record. As I am able to discuss the legal claims involved in general terms, as does the Majority Opinion, I will not spread information the Board deemed confidential on the public record. Appellant Mason-Dixon essentially asserts that the Board capriciously disregarded evidence of potential criminal conduct when it concluded that the Woodlands’ principals demonstrated character suitability by clear and convincing evidence as required by 4 Pa.C.S.",
"§ 1310(a).1 As described by the Majority, Appellant “refers to allegations of wrongdoing by a principal of Woodlands, specifically Joseph Hardy, the crux of which was determined to be unsupported, and all records of the alleged incident were expunged. No criminal prosecution was pursued and no conviction resulted.” Maj. Op. at 1113. Crucially, however, the Majority fails to discuss the allegation that a state trooper associated with the Woodlands’ principals attempted to interfere with the investigation of the criminal complaint against Hardy. My review of the Board’s consideration of these allegations is colored by my reading of the report issued by the Thirty-First Statewide Investigating Grand Jury, filed May 19, 2011, and released to *1115the public on May 24, 2011. While the Grand Jury Report does not relate specifically to the licensing decision in this case, the report nonetheless provides insight into the short-comings of the Board’s procedures generally, emphasizing that the specific cases discussed were merely “the best examples of problems and failures that extended throughout the application and licensing process in all the license categories.” Grand Jury Report No.",
"1 (“GJR”) at 38. Moreover, some of the most serious criticisms leveled against the Board involved the process of reviewing the suitability of applicants’ principals, which is my primary concern in the case at bar. Specifically, the Grand Jury found that “the Board failed to carefully evaluate several applicants’ suitability and its own administrative practices placed the burden of establishing an applicant’s unsuitability beyond all doubt squarely on the Bureau of Investigation and Enforcement” (“BIE”) in direct contrast to the Gaming Act’s requirement that the applicant prove suitability by clear and convincing evidence. Id. at 23; see also 4 Pa.C.S. § 1310(a). Particularly concerning in light of the issues presented in this case, the Grand Jury concluded: [N]umerous investigators testified or provided information regarding their concerns that they were prevented from fully investigating and pursuing legitimate concerns regarding an applicant’s character. Investigators also detailed how information they acquired was not adequately presented to the Board in the final suitability reports prepared by the Bureau of Licensing, and the applicant’s burden of establishing good character by clear and convincing evidence was shifted to the investigators.",
"This created a huge loophole in the thoroughness and accuracy of the BIE information getting to the Board, especially areas of concern found throughout BIE investigations. GJR at 39-40; see also id. at 41 (“Despite their best efforts, [investigators] were instructed not to conduct particular interviews, were prevented from requesting additional information from the applicant, and ultimately reliable and verified information was not presented to the Board in the final suitability report.”). In discussing why certain investigatory information was removed from reports presented to the Board, the Chief Enforcement Counsel to the Board explained that “the goal with regard to the suitability reports was to secure stipulation from the other side, from the applicant, as to its admissibility and making it part of the record.” Id. at 57.2 If a stipulation was not secured, the investigators had to demonstrate absolute proof of the questioned piece of information for it to be included in the final report to the Board. The Grand Jury observed that the BIE seemed more concerned with the sensitivity of the applicant rather than with investigating the merits of the allegations, despite the Gaming Act’s placement of the burden on the applicant to establish its suitability by clear and convincing evidence.",
"Id. at 57. I believe this Court must consider the allegations raised in this case in light of the disturbing criticisms made by the Grand Jury concerning the Board’s character suitability review process. Specifically, Mason-Dixon alleges that the Board inadequately investigated the allegations against the Woodlands’ principals during an executive session in November 2010 regarding the criminal complaint against Mr. Hardy and the allegation of interference with the criminal investigation involv*1116ing that complaint. My review of the closed executive session confirms Mason-Dixon’s concerns in regard to the interference allegation. It appears that at the Board’s executive session the representative of the Office of Enforcement Counsel (“OEC”) relied exclusively on assertions of the Woodlands’ principals in affidavits, very brief testimony, and on the assumption that the fear of other criminal prosecution was sufficient to protect against the principals perjuring themselves before the Board.",
"It is not clear whether the OEC or the BIE attempted to contact anyone other than the Woodlands’ principals. Given the Grand Jury’s findings that the investigators were often prevented from performing thorough investigations and that the information they did gather was not always passed on to the Board, I am particularly disturbed by the cursory investigation into alleged interference with a criminal investigation. Notwithstanding BIE’s seemingly obvious failure to investigate fully the allegations in this case, the record reveals that the Board accepted BIE’s investigation as sufficient. I find that conclusion is not supported by the current record, especially considering that the Gaming Act requires the applicant to prove suitability by clear and convincing evidence. See 4 Pa.C.S. § 1310(a).",
"Even if it is eventually determined that the principals did not interfere with the criminal investigation, the Board must base its conclusion of character suitability on more than self-serving affidavits, very brief testimony, and the belief that if the parties were lying they would have more to worry about than the denial of a gaming license. While I recognize that the Gaming Act provides for confidentiality of information submitted by applicants or obtained by the BIE or the Board for purposes of character suitability review, I nonetheless believe that such confidentiality places a duty on the Board to probe and assess the accuracy of this information that is not otherwise subject to public scrutiny. 4 Pa.C.S.",
"§ 1206(f), 1310(a). The Board cannot act as a rubber stamp for character suitability but must instead conduct a thorough and searching inquiry to determine whether an applicant has proven its principal’s character suitability by clear and convincing evidence. I find the Board’s review in this case to be a wholly unsatisfactory protection of the taxpayers of Pennsylvania from concerns that potential holders of a gaming license might attempt to influence criminal investigations in the future. The absence of a full investigation and inquiry is particularly concerning given that two former Pennsylvania State Police troopers brought a lawsuit against the State Police alleging that they were subject to discriminatory and illegal employment practices in retaliation for their reporting and investigation of the allegation that the state trooper associated with the Woodlands’ principals attempted to interfere with the Hardy criminal investigation.",
"The State Police settled this lawsuit for $675,000, which in my view, lends credence to the allegation that some individuals were attempting to benefit Mr. Hardy and the Woodlands by interfering with the police investigation. While the Majority finds neither a violation of the prudent man rule nor a capricious disregard of the evidence, I am unable to agree. We have no ability to know what was investigated by the BIE or what was found by the investigators and not turned over to the Board, because the Board did not ask the necessary questions to determine the suitability by clear and convincing evidence. Accordingly, I dissent from the affirmance of the grant of the Category 3 slot machine license to Woodlands Fayette, LLC. Instead, I would remand for a proper investigation into the allegations against the principals in this *1117case. I emphasize, however, that I make no determination regarding the ultimate character suitability, leaving that determination, at least in the first instance, to the Board following sufficient investigation and inquiry.",
"Justice TODD joins this opinion. . § 1310, Slot machine license application character requirements (a) Application.-— (1) Every application for a slot machine license shall include such information, documentation and assurances as may be required to establish by clear and convincing evidence the applicant's suitability, including good character, honesty and integrity. Information shall include, without limitation, information pertaining to family, habits, character, reputation, criminal history background, business activities, financial affairs and business, professional and personal associates, covering at least the ten-year period immediately preceding the filing date of the application. 4 Pa.C.S. § 1310(a)(1). . Indeed, the report quotes the Chief Enforcement Counsel as saying that “it’s our job to take people and companies that are unsuitable and make them suitable.” Id. at 45."
] | https://www.courtlistener.com/api/rest/v3/opinions/4966129/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
143 B.R. 887 (1992) In re Mark Carl VEENHUIS, Debtor. Bankruptcy No. 4-92-806. United States Bankruptcy Court, D. Minnesota. August 21, 1992. Robert Anderson, Joseph Dicker & Associates, Minneapolis, Minn., for debtor. Michael Fadlovich, Office of the U.S. Trustee, Minneapolis, Minn., for U.S. Trustee.
MEMORANDUM ORDER DISMISSING CASE NANCY C. DREHER, Bankruptcy Judge. The above-entitled matter came on for hearing before the undersigned on the 6th day of May, 1992, on the United States Trustee's motion to dismiss under 11 U.S.C. § 707(b). Appearances were as follows: Robert Anderson for the debtor, and Michael Fadlovich for the U.S. Trustee.
STATEMENT OF FACTS The debtor is an individual employed as a mechanic for Comfort Bus Co. His available monthly income after deductions is $1,148.34 and his monthly expenses are $1,300.43, according to his amended schedules I and J, leaving a negative monthly cash flow of $152.09. Included in the debtor's expenses are $170.00 child support, $85.43 payment on a boat loan, $40.00 for a cellular telephone, and expenses incurred by the individual the debtor lives with and her son. The only significant assets owned by the debtor are an automobile valued at $1,000.00, a savings account containing $3,400.00, and $500.00 worth of equity in a boat valued at $2,750.00. The debtor claims all of these assets as exempt. The debts listed in the debtor's schedules are entirely consumer debts. In fact, there are only two debts listed and they both arise out of loans for purchases of recreational boats. The first of these boat loans was from First Bank, N.A., but the debtor failed to maintain payments on the loan so the boat was repossessed. First Bank then brought a collection action against the debtor and a codefendant, and obtained a judgment on November 8, 1991 in the amount of $3,296.29. On November 18, 1991 a writ of execution was issued, and on or about January 24, 1992 the debtor's savings account was attached and a notice of garnishment was issued to his employer. The second boat loan was procured through Minnie-Mine Credit Union subsequent to losing the first boat. The debtor currently owes $2,250.00 on this second *888 boat loan, has listed the monthly payment of $85.43 in his schedule of expenses, and has stated his intention to reaffirm the debt. This bankruptcy petition was filed on January 30, 1992 in response to the attachment of the debtor's savings account and notice of garnishment.
CONCLUSIONS OF LAW The U.S. Trustee's motion to dismiss is brought under section 707(b) of the Bankruptcy Code which provides in relevant part: After notice and a hearing, the court, on its own motion or on a motion by the United States Trustee, . . . may dismiss a case filed by an individual debtor under [chapter 7] whose debts are primarily consumer debts if it finds that the granting of relief would be a substantial abuse of the provisions of this chapter. There shall be a presumption in favor of granting the relief requested by the debtor. 11 U.S.C. § 707(b). Section 707(b) provides no definition for the term "substantial abuse," so the courts have routinely looked to the policies underlying enactment of the section when deciding whether granting relief to a particular debtor would be a substantial abuse of the provisions of chapter 7. In doing so, the courts have generally concluded that section 707(b) was meant to deny chapter 7 relief to debtors who are either dishonest or non-needy. See In re Krohn, 886 F.2d 123, 126 (6th Cir.1989) (hereinafter Krohn II); In re Walton, 866 F.2d 981, 983 (8th Cir.1989). Therefore, the court must ascertain whether the debtor is "merely seeking an advantage over his creditors, or instead is `honest,' in the sense that his relationship with his creditors has been marked by essentially honorable and undeceptive dealings, and whether he is `needy' in the sense that his financial predicament warrants the discharge of his debts in exchange for liquidation of his assets." Krohn II, 886 F.2d at 126. According to the Eighth Circuit, the primary factor in determining whether granting a discharge would be a substantial abuse is the debtor's ability to fund a chapter 13 plan. Walton, 866 F.2d at 984-85; U.S. Trustee v. Harris (In re Harris), 960 F.2d 74, 77 (8th Cir.1992) (both citing In re Kelly, 841 F.2d 908 (9th Cir.1988). The debtor in the present case argues that since the ability to fund a chapter 13 plan is the primary focus of the U.S. Trustee's 707(b) motion, the motion should be denied because the debtor has no positive cash flow to fund a chapter 13 plan. If the ability to fund a chapter 13 plan out of future income were the only factor to consider then the debtor's argument would most likely prevail. Although the debtor has a steady job, he currently has a negative monthly cash-flow of $152.09. The U.S. Trustee argues that the debtor's cellular telephone bill and boat payment appear to be unnecessary luxuries that could be eliminated to reduce expenses. However, even without these expenses the debtor would still have a negative monthly cash-flow of $26.66. The U.S. Trustee also indicated that the debtor's clothing and food expenses appeared excessive, but the debtor's amended schedules reflect reasonable expenses ($175/month for food, and $40/month for clothing) and still the debtor's cash-flow is negative. The debtor's argument, however, is fundamentally flawed because there is nothing in either Harris or Walton that suggests that the ability to fund a chapter 13 plan out of future earnings is the only factor to consider. On the contrary, the Walton court expressly stated that "the court may take the petitioner's good faith and unique hardships into consideration under section 707(b)." Walton, 866 F.2d at 983. Furthermore, both Harris and Walton cited with approval language from In re Kelly, 841 F.2d 908 (9th Cir.1988), stating that the inability to fund a chapter 13 plan out of future earnings will not "shield a debtor from section 707(b) dismissal where bad faith is otherwise shown." Harris, 960 F.2d at 76; Walton, 866 F.2d at 985. To hold otherwise would defeat section 707(b)'s goal of denying a discharge both to debtors who are non-needy and those who are dishonest. The Walton court rejected an interpretation of section 707(b) that *889 would have equated substantial abuse with bad faith, prohibiting any consideration of future income and ability to fund a chapter 13 plan. The court stated that such a cramped interpretation would impair the bankruptcy court's ability to dismiss cases filed by debtors who, although not dishonest, are not needy. Walton, 866 F.2d at 983. To hold as the debtor would have me, that the inability to fund a chapter 13 plan prevents dismissal without consideration of any bad faith on the debtor's part, would have a similar effect; it would impair the ability of the bankruptcy courts to dismiss cases under 707(b) where the debtors, although needy, are dishonest. The question whether a case should be dismissed under section 707(b) based on a debtor's bad faith is a subjective determination that must be made on a case-by-case basis. In re Ploegert, 93 B.R. 641, 642 (Bankr.N.D.Ind.1988); In re Herbst, 95 B.R. 98, 101 (W.D.Wis.1988); In re Dubberke, 119 B.R. 677, 679 (Bankr.S.D.Iowa 1990). Factors considered by some courts to be indicative of bad faith include (1) use of chapter 7 to discharge a single debt which the debtor does not wish to pay, In re Busbin, 95 B.R. 240, 246 (Bankr.N.D.Ga. 1989); (2) failure to make a sincere attempt at repaying obligations, In re Krohn, 87 B.R. 926, 929 (N.D.Ohio 1988) (hereinafter Krohn I); (3) desire to repay only certain creditors, Dubberke, 119 B.R. at 681; (4) tying up significant liquid value in superfluous exempt assets, In re Higginbotham, 111 B.R. 955, 965 (Bankr.N.D.Okla.1990); and (5) financial troubles caused by past excesses rather than any unforeseen calamity, Ploegert, 93 B.R. at 643; Krohn I, 87 B.R. at 929. On the facts before me I conclude that this debtor has acted in bad faith. The debtor seeks to discharge a single debt in this case; that of First Bank for the money lent to purchase his prior boat. I have seen no evidence whatsoever that the debtor has made any sincere effort to repay the debt. On the contrary when First Bank garnished the debtor's savings account, which would have been sufficient to repay the debt, the debtor responded by filing this bankruptcy petition. Rather than attempting to satisfy the debt to First Bank, the debtor has selectively chosen to pay Minnie-Mine Credit Union over First Bank in order to retain his second boat. He intends to tie up $85.43 of future income per month in paying for a superfluous exempt asset; such income would go a long way towards satisfying the debt to First Bank. Finally, the debtor's predicament has not been caused by any unforeseen calamity, but rather by his desire to own an expensive recreational boat which he cannot afford. The debtor is simply using the bankruptcy court to exchange a boat he couldn't afford for one that he can. The debtor was either unable or unwilling to make the payments on his prior boat, so he allowed it to be repossessed then got another loan and purchased another boat. Then when the creditor who financed the first boat obtained a personal judgment against the debtor, the debtor filed a petition under chapter 7 seeking solely to discharge his debt to that creditor and to retain the second boat reaffirming his debt thereon. Thus, the end result is that the debtor is attempting to swap boats, making payments on the second boat to the detriment of the creditor that financed the first boat. Bad faith is determined on a case-by-case basis and the manner in which the debtor is attempting to use the protections of the Bankruptcy Code in this case constitutes bad faith. Although section 707(b) creates a presumption in favor of the debtor, the facts of this case are sufficient to rebut such presumption. The debtor has acted in bad faith and cannot take refuge from dismissal in his inability to fund a chapter 13 plan. ACCORDINGLY, IT IS HEREBY ORDERED: This case is DISMISSED under 11 U.S.C. § 707(b). | 10-30-2013 | [
"143 B.R. 887 (1992) In re Mark Carl VEENHUIS, Debtor. Bankruptcy No. 4-92-806. United States Bankruptcy Court, D. Minnesota. August 21, 1992. Robert Anderson, Joseph Dicker & Associates, Minneapolis, Minn., for debtor. Michael Fadlovich, Office of the U.S. Trustee, Minneapolis, Minn., for U.S. Trustee. MEMORANDUM ORDER DISMISSING CASE NANCY C. DREHER, Bankruptcy Judge. The above-entitled matter came on for hearing before the undersigned on the 6th day of May, 1992, on the United States Trustee's motion to dismiss under 11 U.S.C. § 707(b). Appearances were as follows: Robert Anderson for the debtor, and Michael Fadlovich for the U.S. Trustee.",
"STATEMENT OF FACTS The debtor is an individual employed as a mechanic for Comfort Bus Co. His available monthly income after deductions is $1,148.34 and his monthly expenses are $1,300.43, according to his amended schedules I and J, leaving a negative monthly cash flow of $152.09. Included in the debtor's expenses are $170.00 child support, $85.43 payment on a boat loan, $40.00 for a cellular telephone, and expenses incurred by the individual the debtor lives with and her son. The only significant assets owned by the debtor are an automobile valued at $1,000.00, a savings account containing $3,400.00, and $500.00 worth of equity in a boat valued at $2,750.00. The debtor claims all of these assets as exempt. The debts listed in the debtor's schedules are entirely consumer debts. In fact, there are only two debts listed and they both arise out of loans for purchases of recreational boats. The first of these boat loans was from First Bank, N.A., but the debtor failed to maintain payments on the loan so the boat was repossessed. First Bank then brought a collection action against the debtor and a codefendant, and obtained a judgment on November 8, 1991 in the amount of $3,296.29. On November 18, 1991 a writ of execution was issued, and on or about January 24, 1992 the debtor's savings account was attached and a notice of garnishment was issued to his employer.",
"The second boat loan was procured through Minnie-Mine Credit Union subsequent to losing the first boat. The debtor currently owes $2,250.00 on this second *888 boat loan, has listed the monthly payment of $85.43 in his schedule of expenses, and has stated his intention to reaffirm the debt. This bankruptcy petition was filed on January 30, 1992 in response to the attachment of the debtor's savings account and notice of garnishment. CONCLUSIONS OF LAW The U.S. Trustee's motion to dismiss is brought under section 707(b) of the Bankruptcy Code which provides in relevant part: After notice and a hearing, the court, on its own motion or on a motion by the United States Trustee, . .",
". may dismiss a case filed by an individual debtor under [chapter 7] whose debts are primarily consumer debts if it finds that the granting of relief would be a substantial abuse of the provisions of this chapter. There shall be a presumption in favor of granting the relief requested by the debtor. 11 U.S.C. § 707(b). Section 707(b) provides no definition for the term \"substantial abuse,\" so the courts have routinely looked to the policies underlying enactment of the section when deciding whether granting relief to a particular debtor would be a substantial abuse of the provisions of chapter 7. In doing so, the courts have generally concluded that section 707(b) was meant to deny chapter 7 relief to debtors who are either dishonest or non-needy. See In re Krohn, 886 F.2d 123, 126 (6th Cir.1989) (hereinafter Krohn II); In re Walton, 866 F.2d 981, 983 (8th Cir.1989). Therefore, the court must ascertain whether the debtor is \"merely seeking an advantage over his creditors, or instead is `honest,' in the sense that his relationship with his creditors has been marked by essentially honorable and undeceptive dealings, and whether he is `needy' in the sense that his financial predicament warrants the discharge of his debts in exchange for liquidation of his assets.\" Krohn II, 886 F.2d at 126. According to the Eighth Circuit, the primary factor in determining whether granting a discharge would be a substantial abuse is the debtor's ability to fund a chapter 13 plan.",
"Walton, 866 F.2d at 984-85; U.S. Trustee v. Harris (In re Harris), 960 F.2d 74, 77 (8th Cir.1992) (both citing In re Kelly, 841 F.2d 908 (9th Cir.1988). The debtor in the present case argues that since the ability to fund a chapter 13 plan is the primary focus of the U.S. Trustee's 707(b) motion, the motion should be denied because the debtor has no positive cash flow to fund a chapter 13 plan. If the ability to fund a chapter 13 plan out of future income were the only factor to consider then the debtor's argument would most likely prevail.",
"Although the debtor has a steady job, he currently has a negative monthly cash-flow of $152.09. The U.S. Trustee argues that the debtor's cellular telephone bill and boat payment appear to be unnecessary luxuries that could be eliminated to reduce expenses. However, even without these expenses the debtor would still have a negative monthly cash-flow of $26.66. The U.S. Trustee also indicated that the debtor's clothing and food expenses appeared excessive, but the debtor's amended schedules reflect reasonable expenses ($175/month for food, and $40/month for clothing) and still the debtor's cash-flow is negative. The debtor's argument, however, is fundamentally flawed because there is nothing in either Harris or Walton that suggests that the ability to fund a chapter 13 plan out of future earnings is the only factor to consider. On the contrary, the Walton court expressly stated that \"the court may take the petitioner's good faith and unique hardships into consideration under section 707(b).\" Walton, 866 F.2d at 983.",
"Furthermore, both Harris and Walton cited with approval language from In re Kelly, 841 F.2d 908 (9th Cir.1988), stating that the inability to fund a chapter 13 plan out of future earnings will not \"shield a debtor from section 707(b) dismissal where bad faith is otherwise shown.\" Harris, 960 F.2d at 76; Walton, 866 F.2d at 985. To hold otherwise would defeat section 707(b)'s goal of denying a discharge both to debtors who are non-needy and those who are dishonest. The Walton court rejected an interpretation of section 707(b) that *889 would have equated substantial abuse with bad faith, prohibiting any consideration of future income and ability to fund a chapter 13 plan.",
"The court stated that such a cramped interpretation would impair the bankruptcy court's ability to dismiss cases filed by debtors who, although not dishonest, are not needy. Walton, 866 F.2d at 983. To hold as the debtor would have me, that the inability to fund a chapter 13 plan prevents dismissal without consideration of any bad faith on the debtor's part, would have a similar effect; it would impair the ability of the bankruptcy courts to dismiss cases under 707(b) where the debtors, although needy, are dishonest. The question whether a case should be dismissed under section 707(b) based on a debtor's bad faith is a subjective determination that must be made on a case-by-case basis. In re Ploegert, 93 B.R. 641, 642 (Bankr.N.D.Ind.1988); In re Herbst, 95 B.R.",
"98, 101 (W.D.Wis.1988); In re Dubberke, 119 B.R. 677, 679 (Bankr.S.D.Iowa 1990). Factors considered by some courts to be indicative of bad faith include (1) use of chapter 7 to discharge a single debt which the debtor does not wish to pay, In re Busbin, 95 B.R. 240, 246 (Bankr.N.D.Ga. 1989); (2) failure to make a sincere attempt at repaying obligations, In re Krohn, 87 B.R. 926, 929 (N.D.Ohio 1988) (hereinafter Krohn I); (3) desire to repay only certain creditors, Dubberke, 119 B.R. at 681; (4) tying up significant liquid value in superfluous exempt assets, In re Higginbotham, 111 B.R. 955, 965 (Bankr.N.D.Okla.1990); and (5) financial troubles caused by past excesses rather than any unforeseen calamity, Ploegert, 93 B.R. at 643; Krohn I, 87 B.R.",
"at 929. On the facts before me I conclude that this debtor has acted in bad faith. The debtor seeks to discharge a single debt in this case; that of First Bank for the money lent to purchase his prior boat. I have seen no evidence whatsoever that the debtor has made any sincere effort to repay the debt. On the contrary when First Bank garnished the debtor's savings account, which would have been sufficient to repay the debt, the debtor responded by filing this bankruptcy petition. Rather than attempting to satisfy the debt to First Bank, the debtor has selectively chosen to pay Minnie-Mine Credit Union over First Bank in order to retain his second boat. He intends to tie up $85.43 of future income per month in paying for a superfluous exempt asset; such income would go a long way towards satisfying the debt to First Bank.",
"Finally, the debtor's predicament has not been caused by any unforeseen calamity, but rather by his desire to own an expensive recreational boat which he cannot afford. The debtor is simply using the bankruptcy court to exchange a boat he couldn't afford for one that he can. The debtor was either unable or unwilling to make the payments on his prior boat, so he allowed it to be repossessed then got another loan and purchased another boat. Then when the creditor who financed the first boat obtained a personal judgment against the debtor, the debtor filed a petition under chapter 7 seeking solely to discharge his debt to that creditor and to retain the second boat reaffirming his debt thereon. Thus, the end result is that the debtor is attempting to swap boats, making payments on the second boat to the detriment of the creditor that financed the first boat. Bad faith is determined on a case-by-case basis and the manner in which the debtor is attempting to use the protections of the Bankruptcy Code in this case constitutes bad faith. Although section 707(b) creates a presumption in favor of the debtor, the facts of this case are sufficient to rebut such presumption. The debtor has acted in bad faith and cannot take refuge from dismissal in his inability to fund a chapter 13 plan.",
"ACCORDINGLY, IT IS HEREBY ORDERED: This case is DISMISSED under 11 U.S.C. § 707(b)."
] | https://www.courtlistener.com/api/rest/v3/opinions/1836524/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Exhibit 10.2 NOTICE OF GRANT Company: Cree, Inc. 4600 Silicon Drive Durham, NC27703 Tax I.D. 56-1572719 Participant: Award Number: Award Plan: Award Type: Grant Date: Performance Period: Charles M. Swoboda 2004 Long-Term Incentive Compensation Plan Performance Units August 15, 2011 June 27, 2011 through June 24, 2012 Dear Chuck: I am pleased to inform you that Cree, Inc. (the “Company”) has awarded Performance Units to you effective August 15, 2011 (the “Grant Date”).This award is subject to and governed by the terms of the Cree, Inc. 2004 Long-Term Incentive Compensation Plan (the “Plan”), the terms of the Master Performance Unit Award Agreement between you and the Company, and this Notice of Grant. The amount payable to you pursuant to your Performance Units (“D”) will be determined as the result of A x B x C, where: ● A equals your Base Salary; ● B equals your Target Award Level; and ● C equals the Performance Measurement. For purposes of the foregoing, except as expressly provided otherwise in this Notice of Grant, “Base Salary” shall refer to your annual base salary in effect on the last day of the first fiscal quarter of fiscal year 2012 (“FY12”), as provided in the Company’s human resources management system, unless your annual base salary changes after the first fiscal quarter.If your annual base salary changes after the first fiscal quarter, “Base Salary” will mean the weighted average annual base salary for the Performance Period determined by multiplying each annual base salary in effect during the Performance Period by a fraction, the numerator of which is the number of calendar days in the Performance Period on which such annual base salary was in effect and the denominator of which is the number of calendar days in the Performance Period.However, if you are on a leave of absence (other than a leave of absence where you continue to be paid your full base salary through the Company’s payroll system, except payments received under the Company’s short-term disability income protection plan), for all or part of the Performance Period, your Base Salary will be reduced proportionately to equate to the base salary applicable to the number of calendar days you were not on a leave of absence during the Performance Period. For purposes of the foregoing, your “Target Award Level” is one hundred percent (100%) of your Base Salary. For purposes of the foregoing, the “Performance Measurement” is a percentage between 0% and 150% determined by the Compensation Committee of the Company’s Board of Directors (the “Committee”) after assessing the Company’s performance against FY12 revenue and non-GAAP earnings per share (“EPS”) targets. Prior to or at the time of issuance of this Notice of Grant, you will receive one or more schedules (collectively, the “Schedule”) showing the Performance Measurement levels for revenue and non-GAAP EPS targets for the Performance Period. The Committee reserves the right to revise the Schedule no later than ninety (90) days after the start of the Performance Period. The Performance Measurement for the Performance Period will be 0% unless both the minimum revenue and non-GAAP EPS targets are achieved. Provided that the minimum revenue and non-GAAP EPS targets are achieved, the Performance Measurement for the Performance Period will be determined by averaging the Performance Measurement levels associated with actual revenue and non-GAAP EPS results for the Performance Period, rounded to the nearest whole percentage. Except as provided in the Company's Severance Plan for Section 16 Officers, if such plan is then in effect, and except as provided below with respect to your death or LTD Disability (as defined in the Executive Change in Control Agreement between you and the Company effective August 18, 2008 (the "Change in Control Agreement")) or a Change in Control (as defined in Section 7.1 of the Cree, Inc. Equity Compensation Plan (as amended and restated August 5, 2002 and without regard to any subsequent amendments)), (i) you must be continuously employed by the Company as the Company's Chief Executive Officer and President through the last day of the Performance Period to have a right to payment of your Performance Units, (ii) your Performance Units will not be considered earned until thelast day of the Performance Period, and (iii) if you terminate employment with the Company prior to the last day of the Performance Period, with or without cause, you will forfeit your Performance Units. After the end of the Performance Period, your actual Performance Measurement will be determined as follows: Step 1: The Committee will, in good faith and in its sole discretion, determine the Company’s actual revenue and non-GAAP EPSresults for the Performance Period (the “Results,” each a “Result”) using competent and reliable information, including but not limited to audited financial statements, if available. Step 2: The Committee will determine the Performance Measurement for the Performance Period by averaging the Performance Measurement levels on the Schedule that corresponds to each Result, rounded to the nearest whole percentage.However, in the event a Change in Control occurs during the Performance Period, the percentage for each Result will be no less than 100%. Notwithstanding the foregoing, in order to ensure that the Company’s best interests are met, except as specifically provided in the Change in Control Agreement, the Committee in its discretion may decrease or eliminate the amount payable pursuant to your Performance Units at any time prior to payment if it determines in good faith that payment of the full amount otherwise payable pursuant to the Performance Units is not warranted or appropriate; provided, however, so long as you are not in breach of your Confidential Information Agreement (as defined in the Change in Control Agreement), following (i) the commencement of a tender offer or the Company and another party entering into a written agreement that contemplates a transaction, the consummation of either of which would result in a Change in Control as defined in Subsection (a), (b), or (d) of such definition, or (ii) a Change in Control (including without limitation a resulting Change in Control described in clause (i)), the Committee may not decrease or eliminate the amount payable as otherwise determined in accordance withthis Notice of Grant without your prior written consent, except that, this restriction shall cease to apply if the tender offer or the written agreement is terminated or expires without the occurrence of a Change in Control. In connection with the Committee’s determination of the annual revenue and non-GAAP EPS results for the Performance Period, the Committee shall (without limiting its authority to apply negative discretion as provided above) make adjustments that eliminate the effect of any changes or events (each a “Change”) that occur during such Performance Period and that were not fully anticipated and/or accurately incorporated into the financial calculations when the performance targets were determined, where (a) making the adjustment will improve performance results, and (b) the Change has a material effect on results under a performance target (determined consistently with past practice), and (c) the Change comes within one or more of the following categories (determined consistently with past practice, to the extent applicable):(1) changes in corporate or capital structure, including but not limited to debt or equity offerings, mergers, acquisitions or divestitures; or (2) other unusual or nonrecurring events. If prior to settlement of your Performance Units, the Company terminates your employment on account of your LTD Disability or you die, you or your beneficiary will receive payment under your Performance Units as otherwise determined in accordance with this Notice of Grant as if you had remained employed through the payment date for your Performance Units.However, in such event your Base Salary will be proportionally reduced based on the number of calendar days you were employed by the Company and not otherwise on leave of absence as provided above during the Performance Period. - 2 - If there is a Change in Control and you remain continuously employed by the Company through the end of the Performance Period, but your employment terminates In Connection with a Change in Control upon or after the end of the Performance Period but prior to the payment date under your Performance Units, you will be entitled to payment under your Performance Units as otherwise determined in accordance with this Notice of Grant.However, if there is a Change in Control and your employment terminates prior to the end of the Performance Period, you will not be entitled hereunder to a payment under your Performance Units.“In Connection with a Change of Control” will have the same meaning as in Section10(h) of the Change in Control Agreement. In general, payment under your Performance Units will be made as soon as practicable after the end of the Performance Period and, in any event, will be made no later than (i) the end of the second fiscal quarter following the end of the Performance Period or, if earlier,(ii) the 15th day of the third month after the later of the end of the Company's tax year in which the Performance Periodends or the end of your tax year in which the Performance Period ends.However, if payment becomes due under your Performance Units on account of your death or LTD Disability, payment will be made no later than the 15th day of the third month after the later of the end of the Company’s tax year in which your death or LTD Disability, as applicable, occurs or the end of your tax year in which your death or termination of your employment on account of LTD Disability, as applicable, occurs.Alternatively, in the event a Change in Control occurs prior to the payment date of your Performance Units, any payment that becomes due under your Performance Units will be made no later than the 15th day of the third month after the later of the end of the Company’s tax year in which the Change of Control occurs or the end of your tax year in which the Change of Control occurs. This award is intended to fulfill any and all agreements, obligations or promises, whether legally binding or not, previously made by the Company or any Employer under the Plan to grant you Performance Units or to provide you annual incentive compensation for the Performance Period.By signing below, you accept such award, along with all prior awards received by you, in full satisfaction of any such agreement, obligation or promise.By signing below, you expressly acknowledge that you are not a participant in or entitled to a payment under the Management Incentive Compensation Plan. Nothing in this Notice of Grant or the Master Performance Unit Award Agreement is intended to modify or amend the Change in Control Agreement, including but not limited to your right to receive the payment specified in Section 8(a) thereof in accordance with the terms and conditions of the Change in Control Agreement. Date:August 15, 2011 For Cree, Inc. Accepted and agreed to: By: /s/ Thomas H. Werner By: /s/ Charles M. Swoboda Thomas H. Werner Charles M. Swoboda Compensation Committee Chairman - 3 - | [
"Exhibit 10.2 NOTICE OF GRANT Company: Cree, Inc. 4600 Silicon Drive Durham, NC27703 Tax I.D. 56-1572719 Participant: Award Number: Award Plan: Award Type: Grant Date: Performance Period: Charles M. Swoboda 2004 Long-Term Incentive Compensation Plan Performance Units August 15, 2011 June 27, 2011 through June 24, 2012 Dear Chuck: I am pleased to inform you that Cree, Inc. (the “Company”) has awarded Performance Units to you effective August 15, 2011 (the “Grant Date”).This award is subject to and governed by the terms of the Cree, Inc. 2004 Long-Term Incentive Compensation Plan (the “Plan”), the terms of the Master Performance Unit Award Agreement between you and the Company, and this Notice of Grant. The amount payable to you pursuant to your Performance Units (“D”) will be determined as the result of A x B x C, where: ● A equals your Base Salary; ● B equals your Target Award Level; and ● C equals the Performance Measurement.",
"For purposes of the foregoing, except as expressly provided otherwise in this Notice of Grant, “Base Salary” shall refer to your annual base salary in effect on the last day of the first fiscal quarter of fiscal year 2012 (“FY12”), as provided in the Company’s human resources management system, unless your annual base salary changes after the first fiscal quarter.If your annual base salary changes after the first fiscal quarter, “Base Salary” will mean the weighted average annual base salary for the Performance Period determined by multiplying each annual base salary in effect during the Performance Period by a fraction, the numerator of which is the number of calendar days in the Performance Period on which such annual base salary was in effect and the denominator of which is the number of calendar days in the Performance Period.However, if you are on a leave of absence (other than a leave of absence where you continue to be paid your full base salary through the Company’s payroll system, except payments received under the Company’s short-term disability income protection plan), for all or part of the Performance Period, your Base Salary will be reduced proportionately to equate to the base salary applicable to the number of calendar days you were not on a leave of absence during the Performance Period.",
"For purposes of the foregoing, your “Target Award Level” is one hundred percent (100%) of your Base Salary. For purposes of the foregoing, the “Performance Measurement” is a percentage between 0% and 150% determined by the Compensation Committee of the Company’s Board of Directors (the “Committee”) after assessing the Company’s performance against FY12 revenue and non-GAAP earnings per share (“EPS”) targets. Prior to or at the time of issuance of this Notice of Grant, you will receive one or more schedules (collectively, the “Schedule”) showing the Performance Measurement levels for revenue and non-GAAP EPS targets for the Performance Period.",
"The Committee reserves the right to revise the Schedule no later than ninety (90) days after the start of the Performance Period. The Performance Measurement for the Performance Period will be 0% unless both the minimum revenue and non-GAAP EPS targets are achieved. Provided that the minimum revenue and non-GAAP EPS targets are achieved, the Performance Measurement for the Performance Period will be determined by averaging the Performance Measurement levels associated with actual revenue and non-GAAP EPS results for the Performance Period, rounded to the nearest whole percentage.",
"Except as provided in the Company's Severance Plan for Section 16 Officers, if such plan is then in effect, and except as provided below with respect to your death or LTD Disability (as defined in the Executive Change in Control Agreement between you and the Company effective August 18, 2008 (the \"Change in Control Agreement\")) or a Change in Control (as defined in Section 7.1 of the Cree, Inc. Equity Compensation Plan (as amended and restated August 5, 2002 and without regard to any subsequent amendments)), (i) you must be continuously employed by the Company as the Company's Chief Executive Officer and President through the last day of the Performance Period to have a right to payment of your Performance Units, (ii) your Performance Units will not be considered earned until thelast day of the Performance Period, and (iii) if you terminate employment with the Company prior to the last day of the Performance Period, with or without cause, you will forfeit your Performance Units. After the end of the Performance Period, your actual Performance Measurement will be determined as follows: Step 1: The Committee will, in good faith and in its sole discretion, determine the Company’s actual revenue and non-GAAP EPSresults for the Performance Period (the “Results,” each a “Result”) using competent and reliable information, including but not limited to audited financial statements, if available. Step 2: The Committee will determine the Performance Measurement for the Performance Period by averaging the Performance Measurement levels on the Schedule that corresponds to each Result, rounded to the nearest whole percentage.However, in the event a Change in Control occurs during the Performance Period, the percentage for each Result will be no less than 100%.",
"Notwithstanding the foregoing, in order to ensure that the Company’s best interests are met, except as specifically provided in the Change in Control Agreement, the Committee in its discretion may decrease or eliminate the amount payable pursuant to your Performance Units at any time prior to payment if it determines in good faith that payment of the full amount otherwise payable pursuant to the Performance Units is not warranted or appropriate; provided, however, so long as you are not in breach of your Confidential Information Agreement (as defined in the Change in Control Agreement), following (i) the commencement of a tender offer or the Company and another party entering into a written agreement that contemplates a transaction, the consummation of either of which would result in a Change in Control as defined in Subsection (a), (b), or (d) of such definition, or (ii) a Change in Control (including without limitation a resulting Change in Control described in clause (i)), the Committee may not decrease or eliminate the amount payable as otherwise determined in accordance withthis Notice of Grant without your prior written consent, except that, this restriction shall cease to apply if the tender offer or the written agreement is terminated or expires without the occurrence of a Change in Control.",
"In connection with the Committee’s determination of the annual revenue and non-GAAP EPS results for the Performance Period, the Committee shall (without limiting its authority to apply negative discretion as provided above) make adjustments that eliminate the effect of any changes or events (each a “Change”) that occur during such Performance Period and that were not fully anticipated and/or accurately incorporated into the financial calculations when the performance targets were determined, where (a) making the adjustment will improve performance results, and (b) the Change has a material effect on results under a performance target (determined consistently with past practice), and (c) the Change comes within one or more of the following categories (determined consistently with past practice, to the extent applicable):(1) changes in corporate or capital structure, including but not limited to debt or equity offerings, mergers, acquisitions or divestitures; or (2) other unusual or nonrecurring events. If prior to settlement of your Performance Units, the Company terminates your employment on account of your LTD Disability or you die, you or your beneficiary will receive payment under your Performance Units as otherwise determined in accordance with this Notice of Grant as if you had remained employed through the payment date for your Performance Units.However, in such event your Base Salary will be proportionally reduced based on the number of calendar days you were employed by the Company and not otherwise on leave of absence as provided above during the Performance Period.",
"- 2 - If there is a Change in Control and you remain continuously employed by the Company through the end of the Performance Period, but your employment terminates In Connection with a Change in Control upon or after the end of the Performance Period but prior to the payment date under your Performance Units, you will be entitled to payment under your Performance Units as otherwise determined in accordance with this Notice of Grant.However, if there is a Change in Control and your employment terminates prior to the end of the Performance Period, you will not be entitled hereunder to a payment under your Performance Units.“In Connection with a Change of Control” will have the same meaning as in Section10(h) of the Change in Control Agreement.",
"In general, payment under your Performance Units will be made as soon as practicable after the end of the Performance Period and, in any event, will be made no later than (i) the end of the second fiscal quarter following the end of the Performance Period or, if earlier,(ii) the 15th day of the third month after the later of the end of the Company's tax year in which the Performance Periodends or the end of your tax year in which the Performance Period ends.However, if payment becomes due under your Performance Units on account of your death or LTD Disability, payment will be made no later than the 15th day of the third month after the later of the end of the Company’s tax year in which your death or LTD Disability, as applicable, occurs or the end of your tax year in which your death or termination of your employment on account of LTD Disability, as applicable, occurs.Alternatively, in the event a Change in Control occurs prior to the payment date of your Performance Units, any payment that becomes due under your Performance Units will be made no later than the 15th day of the third month after the later of the end of the Company’s tax year in which the Change of Control occurs or the end of your tax year in which the Change of Control occurs. This award is intended to fulfill any and all agreements, obligations or promises, whether legally binding or not, previously made by the Company or any Employer under the Plan to grant you Performance Units or to provide you annual incentive compensation for the Performance Period.By signing below, you accept such award, along with all prior awards received by you, in full satisfaction of any such agreement, obligation or promise.By signing below, you expressly acknowledge that you are not a participant in or entitled to a payment under the Management Incentive Compensation Plan.",
"Nothing in this Notice of Grant or the Master Performance Unit Award Agreement is intended to modify or amend the Change in Control Agreement, including but not limited to your right to receive the payment specified in Section 8(a) thereof in accordance with the terms and conditions of the Change in Control Agreement. Date:August 15, 2011 For Cree, Inc. Accepted and agreed to: By: /s/ Thomas H. Werner By: /s/ Charles M. Swoboda Thomas H. Werner Charles M. Swoboda Compensation Committee Chairman - 3 -"
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
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[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 447 The petitioners herein apply for a writ of prohibition, whereby they seek to prevent the respondent Superior Court of the County of Los Angeles and Honorable F.C. Valentine, one of the judges thereof, from taking any further proceedings in connection with or in the matter of the enforcement of a certain injunctionpendente lite issued by said court through the said judge thereof in a certain action entitled Los Angeles Rock GravelCorporation, Plaintiff, v. The City of Los Angeles and E.C.Eddie, Defendants, commenced on August 14, 1924, and since pending in said court. The petition sets forth in substance that in the complaint in said action the plaintiff prayed for and was accorded a temporary restraining order, and also prayed *Page 448 for an injunction pendente lite and for a permanent injunction restraining the defendants from doing the acts and things set forth and complained of in said complaint. At the time of issuing said temporary restraining order the said court also issued an order to show cause on the twenty-second day of August, 1924, in said court, why said temporary restraining order should not be made permanent. The said temporary restraining order and order to show cause were each issued upon the complaint in said action alone and no affidavits in support of said application for said orders or either of them or of their issuance were presented at the time of the making and issuance thereof, but that on the nineteenth day of August, 1924, there were served and filed certain affidavits on behalf of said plaintiff and in support of its application for an injunction. On the twenty-second day of August, 1924, at the hour set for the hearing upon said order to show cause, the defendants in said action served upon the plaintiff and filed in said court their respective demurrers, answers, and counter-affidavits in opposition to the plaintiff's said application for an injunction. The plaintiff thereupon requested that its application for an injunction pendente lite be continued to a later date because of the fact that the counter-affidavits of the defendants, which were voluminous, had just been served. The court granted said request and the hearing upon the plaintiff's application for an injunction was accordingly continued until the twenty-seventh day of August, 1924. When said matter came up for hearing in said court on August 27, 1924, the plaintiff served upon the defendants certain further and additional affidavits in support of its said application and in reply, in part, at least, to the counter-affidavits which had theretofore been filed by said defendants. When said matter was called for hearing on said last-named day the defendants objected to the consideration by the court of the plaintiff's said last-mentioned affidavits upon the ground that said affidavits had not been served at least two days prior to such hearing; and also moved to strike said last-mentioned affidavits from the files. The defendants also objected to the consideration of said application upon the ground that the plaintiff's complaint had not been verified as required by statute. The defendants further moved to dismiss and vacate the temporary restraining order and *Page 449 order to show cause upon the ground last stated. The court overruled these several objections of the defendants and denied their said motions based thereon, and proceeded to hear said matter and to consider all of the affidavits presented therein and to thereupon order an injunction pendente lite to issue in said cause; and such injunction pendente lite was thereupon issued and is being enforced, and is threatened to be continued in force against the petitioners herein. Wherefore they seek this writ. Upon the return to an alternative writ issued herein the plaintiff in said action and the respondent herein has presented an answer and return embracing the entire record and all of the pleadings, motions, and affidavits of the respective parties thereto and the rulings of the court made therein. We are thus placed in a position to fully consider the merits of the application for this writ and the response and opposition thereto. The first contention of the petitioner herein is that the said court in which said action was pending acquired no jurisdiction to issue or enforce a temporary or other restraining order therein, for the reason that the plaintiff's complaint therein was not verified, as required by the statute. The verification of said complaint was attempted to be made by one H.W. Hawley, who, after deposing therein that he was the president of said corporation plaintiff, proceeded to state that "He has read the foregoing complaint and knows the contents thereof and that the facts stated therein are true." While this verification does not in precise form or verbiage conform to the language of section 446 of the Code of Civil Procedure, it does substantially conform to the interpretation placed upon that section in the cases of Newman v. Bird, 60 Cal. 372, 375, andLassen v. Board of Dental Examiners, 24 Cal. App. 767, 770 [142 P. 505]. It will therefore be held sufficient to constitute said complaint a verified complaint in compliance with section 527 of the Code of Civil Procedure requiring the complaint to be verified in order to form a basis for the issuance of a preliminary injunction. This point, however, is no longer available to the petitioner herein, for the reason that even though the temporary restraining order issued by the court was void, because based upon an inadequately verified complaint without affidavits, said temporary restraining order has fulfilled its function and been supplanted by *Page 450 the preliminary injunction issued herein on August 27, 1924, and which was based in part, at least, upon the plaintiff's verified complaint and upon the affidavits served and filed on behalf of the plaintiff on August 19, 1924. The sole question herein is, therefore, as to the power and jurisdiction of said court to order and issue this latter injunction. A further statement of the facts as disclosed by the record herein will be required in order to a proper determination of this question. Following the order of the court made on August 14, 1924, fixing the date of August 22, 1924, for the hearing upon the plaintiff's application for a preliminary injunction, the plaintiff, on August 19, 1924, filed a supporting affidavit of one H.W. Hawley, president of the plaintiff corporation, purporting to supplement the averments of its complaint as to why the defendants should be enjoined, pending the action, from doing the acts complained of. The plaintiff having also filed its points and authorities in support of its application at the time of filing its complaint, had thus fully complied with the requirements of the provisions of section 527 of the Code of Civil Procedure, relating to the issuance of temporary restraining orders ex parte; and the court, in fixing the date of August 22, 1924, for the hearing upon the plaintiff's application for an injunction pendente lite, had also acted within the authority granted it by said section. The matter was therefore regularly before the court for hearing upon said last-named day and the court had jurisdiction to then hear and determine the plaintiff's said application for an injunctionpendente lite; or, under certain conditions, also provided for in said section 527 of the Code of Civil Procedure, to continue the hearing thereon to a later date. These conditions are embodied in the further terms of said section, which provide that "The defendant, however, shall be entitled as of course to one continuance for a reasonable period if he desires it to enable him to meet the application for the preliminary injunction." In this case the defendants did not request or desire such continuance, but in response to the order to show cause, and at the time fixed for the hearing thereon, presented, served, and filed affidavits in opposition to the plaintiff's application for a preliminary injunction. Not having, however, served or filed such affidavits two days prior to said hearing, the further *Page 451 provision of said section of the code came into play, which entitled the applicant for the preliminary injunction to a continuance of said hearing in order to enable plaintiff to respond to the defendants' said counter-affidavits. The trial court had, therefore, jurisdiction to grant the plaintiff's request for such continuance, and hence to make its order fixing August 27, 1924, as the date for hearing the plaintiff's motion for a preliminary injunction; and having such power it would also seem clear that under the intendments of said section of the code it had also power to continue in force the temporary restraining order theretofore issued by it ex parte, to the end that whatever preliminary injunction it might conclude to issue might not be ineffectual. When the matter of the issuance of such preliminary injunction came on for hearing upon August 27, 1924, the plaintiff presented and served and offered for filing its further affidavits in opposition to the counter-showing which the defendants had proffered upon the date set for the previous hearing, whereupon the defendants made the several objections to the receipt or consideration thereof and to the hearing itself which are above set forth and which form the basis of its present application for a writ of prohibition. The trial court overruled these objections and proceeded to hear and consider the matter upon the plaintiff's said verified complaint and upon all of the affidavits then before it. That it did so properly upon the basis of the plaintiff's verified complaint we have already above determined. That it also did so properly upon the basis of its order continuing the matter of said hearing from the date first fixed for such hearing we have also above determined. As to the defendants' objection to such hearing upon the date last set therefor, based upon the fact that the plaintiff had not presented, served, and filed its counter-affidavits to the defendants' showing two days before said last-named date of hearing, we find nothing in the statute which so requires. [6] The provision in section 527 of the Code of Civil Procedure which requires the plaintiff receiving a temporary ex parte restraining order and applying for a preliminary injunction upon notice to serve his affidavits two days prior to the date first set for hearing upon said application has reference only to such hearing, and the only penalty imposed by said section upon his failure to so serve *Page 452 his said affidavits is the dissolution of the temporary restraining order. When the provisions of the statute have been satisfied and the trial court has acquired jurisdiction to hear and determine the plaintiff's application for a preliminary injunction upon the day first appointed for such hearing or to continue such hearing to a later date, there is no provision in the statute nor is there any authority to which we have been cited which declares that the court shall lose its jurisdiction over the subject matter of such hearing for the reasons which are urged by the petitioners herein. The case of Green v. City ofLos Angeles, 65 Cal. App. 237 [223 P. 582], has no application to the facts of this case or to the order or orders of the trial court which form the subject of assault in this proceeding. It is, however, contended by the petitioners herein that the affidavits which the plaintiff finally filed on August 27, 1924, were not in fact counter-affidavits to the showing in opposition to the granting of said preliminary injunction presented, served, and filed by the defendant upon the previous date, but were part of the original showing which the plaintiff should have served and filed two days prior to the date first fixed for such hearing, and hence that such affidavits should not have been considered by the trial court in determining to issue such preliminary injunction. An examination of such affidavits does not bear out this latter construction, since some considerable portions thereof at least consist in statements in rebuttal of the defendants' said counter-showing; and even if it were true that some portions of the plaintiff's said affidavits consisted of matter which should have been earlier presented, and if it also be true that the trial court considered such portions thereof in concluding to grant the preliminary injunction, its action in so doing would be simply error in the exercise of its acquired jurisdiction which might be corrected upon appeal, but which cannot be considered upon this application. The application for a writ of prohibition is denied. Seawell, J., Shenk, J., Myers, C.J., Waste, J., Lawlor, J., and Houser, J., pro tem., concurred. *Page 453 | 07-05-2016 | [
"[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 447 The petitioners herein apply for a writ of prohibition, whereby they seek to prevent the respondent Superior Court of the County of Los Angeles and Honorable F.C. Valentine, one of the judges thereof, from taking any further proceedings in connection with or in the matter of the enforcement of a certain injunctionpendente lite issued by said court through the said judge thereof in a certain action entitled Los Angeles Rock GravelCorporation, Plaintiff, v. The City of Los Angeles and E.C.Eddie, Defendants, commenced on August 14, 1924, and since pending in said court.",
"The petition sets forth in substance that in the complaint in said action the plaintiff prayed for and was accorded a temporary restraining order, and also prayed *Page 448 for an injunction pendente lite and for a permanent injunction restraining the defendants from doing the acts and things set forth and complained of in said complaint. At the time of issuing said temporary restraining order the said court also issued an order to show cause on the twenty-second day of August, 1924, in said court, why said temporary restraining order should not be made permanent.",
"The said temporary restraining order and order to show cause were each issued upon the complaint in said action alone and no affidavits in support of said application for said orders or either of them or of their issuance were presented at the time of the making and issuance thereof, but that on the nineteenth day of August, 1924, there were served and filed certain affidavits on behalf of said plaintiff and in support of its application for an injunction. On the twenty-second day of August, 1924, at the hour set for the hearing upon said order to show cause, the defendants in said action served upon the plaintiff and filed in said court their respective demurrers, answers, and counter-affidavits in opposition to the plaintiff's said application for an injunction. The plaintiff thereupon requested that its application for an injunction pendente lite be continued to a later date because of the fact that the counter-affidavits of the defendants, which were voluminous, had just been served. The court granted said request and the hearing upon the plaintiff's application for an injunction was accordingly continued until the twenty-seventh day of August, 1924. When said matter came up for hearing in said court on August 27, 1924, the plaintiff served upon the defendants certain further and additional affidavits in support of its said application and in reply, in part, at least, to the counter-affidavits which had theretofore been filed by said defendants.",
"When said matter was called for hearing on said last-named day the defendants objected to the consideration by the court of the plaintiff's said last-mentioned affidavits upon the ground that said affidavits had not been served at least two days prior to such hearing; and also moved to strike said last-mentioned affidavits from the files. The defendants also objected to the consideration of said application upon the ground that the plaintiff's complaint had not been verified as required by statute. The defendants further moved to dismiss and vacate the temporary restraining order and *Page 449 order to show cause upon the ground last stated. The court overruled these several objections of the defendants and denied their said motions based thereon, and proceeded to hear said matter and to consider all of the affidavits presented therein and to thereupon order an injunction pendente lite to issue in said cause; and such injunction pendente lite was thereupon issued and is being enforced, and is threatened to be continued in force against the petitioners herein.",
"Wherefore they seek this writ. Upon the return to an alternative writ issued herein the plaintiff in said action and the respondent herein has presented an answer and return embracing the entire record and all of the pleadings, motions, and affidavits of the respective parties thereto and the rulings of the court made therein. We are thus placed in a position to fully consider the merits of the application for this writ and the response and opposition thereto. The first contention of the petitioner herein is that the said court in which said action was pending acquired no jurisdiction to issue or enforce a temporary or other restraining order therein, for the reason that the plaintiff's complaint therein was not verified, as required by the statute.",
"The verification of said complaint was attempted to be made by one H.W. Hawley, who, after deposing therein that he was the president of said corporation plaintiff, proceeded to state that \"He has read the foregoing complaint and knows the contents thereof and that the facts stated therein are true.\" While this verification does not in precise form or verbiage conform to the language of section 446 of the Code of Civil Procedure, it does substantially conform to the interpretation placed upon that section in the cases of Newman v. Bird, 60 Cal. 372, 375, andLassen v. Board of Dental Examiners, 24 Cal. App. 767, 770 [142 P. 505]. It will therefore be held sufficient to constitute said complaint a verified complaint in compliance with section 527 of the Code of Civil Procedure requiring the complaint to be verified in order to form a basis for the issuance of a preliminary injunction.",
"This point, however, is no longer available to the petitioner herein, for the reason that even though the temporary restraining order issued by the court was void, because based upon an inadequately verified complaint without affidavits, said temporary restraining order has fulfilled its function and been supplanted by *Page 450 the preliminary injunction issued herein on August 27, 1924, and which was based in part, at least, upon the plaintiff's verified complaint and upon the affidavits served and filed on behalf of the plaintiff on August 19, 1924. The sole question herein is, therefore, as to the power and jurisdiction of said court to order and issue this latter injunction. A further statement of the facts as disclosed by the record herein will be required in order to a proper determination of this question.",
"Following the order of the court made on August 14, 1924, fixing the date of August 22, 1924, for the hearing upon the plaintiff's application for a preliminary injunction, the plaintiff, on August 19, 1924, filed a supporting affidavit of one H.W. Hawley, president of the plaintiff corporation, purporting to supplement the averments of its complaint as to why the defendants should be enjoined, pending the action, from doing the acts complained of. The plaintiff having also filed its points and authorities in support of its application at the time of filing its complaint, had thus fully complied with the requirements of the provisions of section 527 of the Code of Civil Procedure, relating to the issuance of temporary restraining orders ex parte; and the court, in fixing the date of August 22, 1924, for the hearing upon the plaintiff's application for an injunction pendente lite, had also acted within the authority granted it by said section.",
"The matter was therefore regularly before the court for hearing upon said last-named day and the court had jurisdiction to then hear and determine the plaintiff's said application for an injunctionpendente lite; or, under certain conditions, also provided for in said section 527 of the Code of Civil Procedure, to continue the hearing thereon to a later date. These conditions are embodied in the further terms of said section, which provide that \"The defendant, however, shall be entitled as of course to one continuance for a reasonable period if he desires it to enable him to meet the application for the preliminary injunction.\" In this case the defendants did not request or desire such continuance, but in response to the order to show cause, and at the time fixed for the hearing thereon, presented, served, and filed affidavits in opposition to the plaintiff's application for a preliminary injunction. Not having, however, served or filed such affidavits two days prior to said hearing, the further *Page 451 provision of said section of the code came into play, which entitled the applicant for the preliminary injunction to a continuance of said hearing in order to enable plaintiff to respond to the defendants' said counter-affidavits.",
"The trial court had, therefore, jurisdiction to grant the plaintiff's request for such continuance, and hence to make its order fixing August 27, 1924, as the date for hearing the plaintiff's motion for a preliminary injunction; and having such power it would also seem clear that under the intendments of said section of the code it had also power to continue in force the temporary restraining order theretofore issued by it ex parte, to the end that whatever preliminary injunction it might conclude to issue might not be ineffectual. When the matter of the issuance of such preliminary injunction came on for hearing upon August 27, 1924, the plaintiff presented and served and offered for filing its further affidavits in opposition to the counter-showing which the defendants had proffered upon the date set for the previous hearing, whereupon the defendants made the several objections to the receipt or consideration thereof and to the hearing itself which are above set forth and which form the basis of its present application for a writ of prohibition. The trial court overruled these objections and proceeded to hear and consider the matter upon the plaintiff's said verified complaint and upon all of the affidavits then before it.",
"That it did so properly upon the basis of the plaintiff's verified complaint we have already above determined. That it also did so properly upon the basis of its order continuing the matter of said hearing from the date first fixed for such hearing we have also above determined. As to the defendants' objection to such hearing upon the date last set therefor, based upon the fact that the plaintiff had not presented, served, and filed its counter-affidavits to the defendants' showing two days before said last-named date of hearing, we find nothing in the statute which so requires. [6] The provision in section 527 of the Code of Civil Procedure which requires the plaintiff receiving a temporary ex parte restraining order and applying for a preliminary injunction upon notice to serve his affidavits two days prior to the date first set for hearing upon said application has reference only to such hearing, and the only penalty imposed by said section upon his failure to so serve *Page 452 his said affidavits is the dissolution of the temporary restraining order. When the provisions of the statute have been satisfied and the trial court has acquired jurisdiction to hear and determine the plaintiff's application for a preliminary injunction upon the day first appointed for such hearing or to continue such hearing to a later date, there is no provision in the statute nor is there any authority to which we have been cited which declares that the court shall lose its jurisdiction over the subject matter of such hearing for the reasons which are urged by the petitioners herein. The case of Green v. City ofLos Angeles, 65 Cal. App.",
"237 [223 P. 582], has no application to the facts of this case or to the order or orders of the trial court which form the subject of assault in this proceeding. It is, however, contended by the petitioners herein that the affidavits which the plaintiff finally filed on August 27, 1924, were not in fact counter-affidavits to the showing in opposition to the granting of said preliminary injunction presented, served, and filed by the defendant upon the previous date, but were part of the original showing which the plaintiff should have served and filed two days prior to the date first fixed for such hearing, and hence that such affidavits should not have been considered by the trial court in determining to issue such preliminary injunction. An examination of such affidavits does not bear out this latter construction, since some considerable portions thereof at least consist in statements in rebuttal of the defendants' said counter-showing; and even if it were true that some portions of the plaintiff's said affidavits consisted of matter which should have been earlier presented, and if it also be true that the trial court considered such portions thereof in concluding to grant the preliminary injunction, its action in so doing would be simply error in the exercise of its acquired jurisdiction which might be corrected upon appeal, but which cannot be considered upon this application.",
"The application for a writ of prohibition is denied. Seawell, J., Shenk, J., Myers, C.J., Waste, J., Lawlor, J., and Houser, J., pro tem., concurred. *Page 453"
] | https://www.courtlistener.com/api/rest/v3/opinions/3304971/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Title: (MI) Major damage to my car from clipping a large rock in a professional building parking lot. Responsibility? Question:I park here, once a week, while at an appointment in the building. It's a small, maybe 8 car, lot that doesn't have much room to maneuver. There's about a 2' x 3' corner that has obviously been driven on, so there is no grass, only dirt. I'm guessing the building owner thought to stop people from driving on the spot by surrounding it with about 18-24" diameter rocks. There were no rocks before today and I didn't see them until I clipped one, right past my front right wheel. It sort of rolled/dragged all the way to the back wheel. The damage is scrapes and gouges deeper than the paint, with a 2-3" deep dent at the end, including a slice completely through the metal in the sliding door. Being a 2015 van, I'm guestimating it's easily $3k in damages. Is the repair 100% my responsibility? Answer #1: If you hit a stationary and ordinarily visible object placed outside of the parking lot entirely, it’s going to be hard to argue that anyone other than you is at fault here. Sorry. You can try, but you’ll probably be eating the cost. | 08-08-2018 | [
"Title: (MI) Major damage to my car from clipping a large rock in a professional building parking lot. Responsibility? Question:I park here, once a week, while at an appointment in the building. It's a small, maybe 8 car, lot that doesn't have much room to maneuver. There's about a 2' x 3' corner that has obviously been driven on, so there is no grass, only dirt.",
"I'm guessing the building owner thought to stop people from driving on the spot by surrounding it with about 18-24\" diameter rocks. There were no rocks before today and I didn't see them until I clipped one, right past my front right wheel. It sort of rolled/dragged all the way to the back wheel. The damage is scrapes and gouges deeper than the paint, with a 2-3\" deep dent at the end, including a slice completely through the metal in the sliding door. Being a 2015 van, I'm guestimating it's easily $3k in damages. Is the repair 100% my responsibility? Answer #1: If you hit a stationary and ordinarily visible object placed outside of the parking lot entirely, it’s going to be hard to argue that anyone other than you is at fault here. Sorry. You can try, but you’ll probably be eating the cost."
] | https://www.reddit.com/r/legaladvice/comments/95okap/mi_major_damage_to_my_car_from_clipping_a_large/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
EL Juez Asociado Señor Rebollo López emitió la opinión del Tribunal. La controversia a resolver en el presente caso es si las disposiciones de la Ley Núm. 12 de 5 de mayo de 1953, según enmendada, 3 L.P.R.A. secs. 696-698, sobre transfe-rencia de licencia por vacaciones y por enfermedad, entre el Servicio Exento y los Servicios por Oposición o sin Oposición del Personal del Gobierno de Puerto Rico, aplican a situaciones en que un empleado de una agencia o instru-mentalidad del Gobierno de Puerto Rico solicita y obtiene una licencia sin sueldo para prestar servicios temporeros en otra agencia o instrumentalidad; de concluir en la afir-mativa, debemos determinar a cuál de las dos agencias o instrumentalidades le corresponde hacer el pago del exceso por licencias de vacaciones y enfermedad acumuladas, cuando dicho exceso surge a raíz de la prestación de servi-cios en virtud de la mencionada licencia sin paga. Ala luz de lo resuelto en Aut. de Puertos v. Mun. de San Juan, 123 D.P.R. 496 (1989), concluimos que las disposiciones de la Ley Núm. 12, ante, aplican a situaciones como las del caso de autos. La agencia, instrumentalidad o corpora-ción pública que obtiene los servicios del empleado en vir-tud de una licencia sin sueldo, está obligada a aceptar la transferencia del balance máximo transferible por dicha ley, en concepto de licencias por vacaciones y enfermedad acumuladas en su empleo regular. Dicho de otra manera, el balance que tenga el empleado acumulado hasta el mo-mento en su puesto original se transfiere, hasta el límite máximo transferible, a la segunda dependencia a la cual pasa al amparo de la licencia sin sueldo que le fue conce-dida por la primera. Así las cosas, cuando el empleado re-ingrese a su puesto original, luego de haber concluido su licencia sin sueldo, se da una segunda transferencia de los balances acumulados por concepto de vacaciones y enfer-medad en la segunda agencia, de conformidad con el límite máximo transferible dispuesto en la Ley Núm. 12, ante. *6Resolvemos que, no obstante las circunstancias particu-lares de este caso, en donde la agencia que recibió los ser-vicios del empleado no tenía reglamentación aprobada en cuanto al pago del exceso por concepto de licencias acumu-ladas, le corresponde de todas maneras a dicha agencia satisfacer el pago por el exceso de dichas licencias de vaca-ciones y enfermedad acumulado mientras éste rindió ser-vicios bajo su supervisión. HH El demandante recurrido, Narciso E. Matos Nazario, se desempeñó por aproximadamente diecinueve (19) años como ingeniero civil en la Autoridad de Carreteras y Transportación (en adelante ACT) hasta el 30 de septiembre de 1993. En dicha fecha le fue concedida una licencia sin sueldo por la ACT para que éste pasara a prestar servicios temporeros en un puesto de confianza en la Administración de Facilidades y Servicios de Salud (en adelante AFASS), tarea que realizó por dos (2) años consecutivos, desde el 1 de octubre de 1993 hasta el 13 de octubre de 1995.(1) Al momento de serle concedida al demandante la referida li-cencia sin sueldo, en octubre de 1993, éste tenía acumula-dos en la ACT, cuarenta y seis y medio (46.5) días por con-cepto de licencia de vacaciones y noventa (90) días de *7licencia por enfermedad.CO Por otra parte, durante los dos (2) años que rindió servicios en AFASS, éste acumuló allí cuarenta y dos (42) días de licencia de vacaciones y treinta y seis y medio (36.5) días por enfermedad.(3) Una vez concluido el periodo de dos (2) años de licencia sin sueldo, el señor Matos Nazario renunció a su puesto de confianza en AFASS, efectivo el viernes 13 de octubre de 1995, para así reintegrarse el próximo lunes 16 de octubre, a sus labores en la ACT, sin que mediara interrupción o desvinculación alguna del sistema de servicio público. Una vez reintegrado a su puesto original en la ACT, el señor Matos Nazario reclamó en varias ocasiones, tanto a la ACT como a AFASS, el pago de licencias por vacaciones y enfer-medad acumuladas en exceso del máximo reglamentario establecido para dichas licencias en ambas dependencias. (4) La ACT negó su responsabilidad en cuanto al pago del exceso reclamado, mediante carta dirigida al demandante *8con fecha de 11 de julio de 1996. En dicha carta, la ACT alegó que no tenía obligación alguna de pagar el exceso de licencias acumuladas logrado mientras prestaba servicios en AFASS, y que era a esta agencia a quien le correspondía desembolsar dicho exceso. AFASS, por su parte, rechazó todo tipo de responsabilidad en cuanto al pago del exceso de días acumulados, mediante carta dirigida al Director Ejecutivo de la ACT, Ing. Sergio González, con fecha de 14 de octubre de 1996. Finalmente, mediante carta de 25 de noviembre de ese mismo año, dirigida al demandante por la ACT, ésta resol-vió acreditarle a éste trece y medio (13.5) días de vacacio-nes de los cuarenta y dos (42) que éste acumuló en AFASS para así cumplir con el máximo reglamentario de sesenta (60) días y no le acreditó ninguno de los treinta y seis y medio (36.5) días que éste acumuló por enfermedad en tal lugar por razón de que el demandante ya había acumulado el tope de noventa (90) días reglamentario. Alegó ACT, ade-más, que era a AFASS a quien le correspondía satisfacer el balance restante por concepto de vacaciones (28.5 días) y el exceso acumulado por concepto de enfermedad (36.5 días). El 3 de junio de 1997, el Sr. Matos Nazario radicó una reclamación ante la Junta de Apelaciones del Sistema de Administración de Personal (JASAP), solicitando la resolu-ción del “impasse existente” entre la ACT y la AFASS en cuanto a cuál de las dos correspondía realizar el pago del exceso reclamado por concepto de licencia de vacaciones y *9enfermedad. JASAP desestimó dicha reclamación alegando que, por disposición de la Sec. 7.14 de la Ley de Personal del Servicio Público de Puerto Rico, Ley Núm. 5 de 14 de octubre de 1975 (3 L.P.R.A. sec. 1394), no tenía jurisdicción en cuanto a la reclamación del señor Matos Nazario, pues dicha sección de ley le impide entender en reclamaciones instadas por empleados de confianza. (5) Así las cosas, el 11 de septiembre de 1997, el señor Ma-tos Nazario radicó demanda civil sobre reclamación de sa-larios ante la Sala de San Juan del Tribunal de Primera Instancia, solicitando de dicho foro que determinara a cual de las dos, la ACT o la AFASS, le correspondía satisfacer la cantidad de dinero a la cual era acreedor por virtud del exceso en licencias que había acumulado por vacaciones y por enfermedad mientras trabajaba en AFASS. Solicitó, además, el demandante que dicho foro dictara sentencia a su favor disponiendo el pago del exceso en cuestión, por la cantidad ascendente a catorce mil novecientos cincuenta dólares ($14,950), que alegó era la cantidad monetaria adeudada por concepto de dicho exceso. Reclamó, por úl-timo, indemnización por gastos, costas y una suma razona-ble por honorarios de abogado. La ACT contestó la demanda el 22 de septiembre de 1997, negando toda responsabilidad sobre la deuda recla-mada y radicó demanda contra co-parte contra AFASS, aduciendo que ésta era la única responsable de liquidar el exceso de licencia regular y por enfermedad acumulado por el demandante durante su incumbencia y trabajo para dicha agencia. A finales de enero de 1998, el Estado Libre Asociado de Puerto Rico, en representación de AFASS, con-testó la referida demanda, alegando que no estaba obligado a pagar al demandante dinero alguno por el exceso acumu-lado de licencias, correspondiendo dicho pago a la ACT. Así las cosas, el 4 de febrero de 1998, el Tribunal de Primera Instancia ordenó a los abogados y clientes a re-*10unirse con el propósito de llegar a ciertos acuerdos y a una posible transacción, dada la naturaleza de los asuntos planteados.(6) Conforme a tal orden, los abogados de las partes celebraron una reunión el 27 de mayo de dicho año. En una moción informativa radicada por la parte deman-dante, se le notificó al tribunal sobre lo acontecido en dicha reunión, a saber: que las partes habían llegado a un con-senso en cuanto a las controversias a ser dirimidas habían acordado solicitar señalamiento de vista para discutir el estado de los procedimientos, sugiriendo como fecha para dicha vista el 18 ó 19 de agosto de 1998. A base de tal sugerencia, se celebró una vista transaccional el 18 de agosto. A ésta, comparecieron los representantes legales del demandante y de la ACT, pero no así la representación legal de AFASS. De acuerdo a la “minuta” que recoge los procedimientos acaecidos durante dicha vista, en dicho día se debía infor-mar al tribunal sobre si el Departamento de Justicia —en representación de AFASS— estaba en disposición de llegar a un acuerdo para pagar las sumas reclamadas. Por razón de la incomparecencia de la representación legal de AFASS, se le concedió al Departamento de Justicia el tér-mino de quiñce (15) días para informar al tribunal su po-sición y para mostrar causa por la cual no debían ser eli-minadas sus alegaciones.(7) Dicho foro señaló, además, la celebración de la conferencia con antelación al juicio para el día 7 de octubre de 1998. El Departamento de Justicia respondió mediante mo-ción el 31 de agosto de ese mismo año, excusando su incom-parecencia a la vista del 18 de agosto, solicitando treinta (30) días adicionales para expresar su posición respecto a *11la reclamación entablada en su contra y solicitando, ade-más, la transferencia de la conferencia con antelación al juicio para fecha posterior, sugiriendo, entre otras fechas, el 12 de noviembre de 1998. El tribunal accedió a tal soli-citud, mediante orden del 15 de septiembre de ese año, transfiriendo la mencionada conferencia para el 12 de no-viembre de 1998. Llegado tal día, comparecieron a dicha conferencia las representaciones legales del demandante y de la ACT, no compareciendo, por segunda ocasión, la representación legal de AFASS. Según consta en la “minuta” de la conferen-cia, el tribunal procedió a eliminar las alegaciones de AFASS y a anotarle la rebeldía por razón de las múltiples incomparecencias de dicha parte e incumplimientos con las órdenes del tribunal, haciéndose constar el hecho de que ya el Departamento de Justicia había sido apercibido previa-mente sobre las posibles consecuencias de sus incumplimientos. AFASS, representado por el Departa-mento de Justicia, solicitó reconsideración, esto es, que se dejara sin efecto la anotación de rebeldía en su contra, la cual fue denegada de plano por el foro de instancia. El tribunal de instancia procedió a dictar sentencia en rebeldía en contra de AFASS, sin la celebración de una vista en su fondo, archivándose en autos copia de la misma el día 30 de julio de 1999. Impuso a AFASS el pago inme-diato al demandante de la suma de catorce mil novecientos cincuenta dólares ($14,950), en virtud del exceso de 28.5 días acumulados por éste en concepto de licencia de vaca-ciones y de 36.5 días acumulados en concepto de enferme-dad, correspondiente al periodo de tiempo en que ofreció servicios profesionales en AFASS a raíz de la licencia sin sueldo que le fue concedida por la ACT. El foro de instancia basó su decisión en lo resuelto por este Tribunal en el caso Aut. de Puertos v. Mun. de San Juan, ante. *12Inconforme, AFASS presentó recurso de apelación ante el Tribunal de Circuito de Apelaciones, el cual confirmó la sentencia dictada por el foro de instancia.(8) El foro apela-tivo intermedio resolvió que no era necesaria, debido a las circunstancias particulares del caso de autos, la celebra-ción de una vista en su fondo para recibir prueba y poder dictar sentencia en rebeldía en contra del Estado Libre Asociado o alguna agencia o instrumentalidad de éste, se-gún lo requiere la Regla 45.5 de Procedimiento Civil, 32 L.P.R.A. Ap. III;(9) esto, debido a que, según advirtió del expediente y de los escritos de las partes, los hechos esen-ciales que dieron lugar a la reclamación y al caso de autos, nunca estuvieron en disputa, por lo que la controversia siempre giró en torno a un asunto estrictamente de dere-cho, a saber: determinar a cuál agencia correspondía satis-facer el exceso reclamado y si eran de aplicación o no al caso de autos, las disposiciones de la Ley Núm. 12, ante. Concluyó, además, el foro apelativo intermedio que al pasar el señor Matos Nazario de la ACT a AFASS, esta última agencia tenía que acreditarle los balances de licen-cia por vacaciones y por enfermedad acumulados en su em-pleo anterior, independientemente de que el traslado se hubiera hecho a través de una licencia sin sueldo; que al *13momento de éste pasar de la ACT a AFASS en primera instancia, la ACT no tenía que liquidar nada al deman-dante pues el total de días que tenía acumulado no excedía el total máximo acumulable por reglamentación de la pro-pia Autoridad; que ya cuando el demandante pasó nueva-mente de la AFASS a la ACT, éste sí cualificaba para el pago en efectivo pues a esa fecha ya había acumulado días de licencia por vacaciones y enfermedad en exceso de lo establecido en el reglamento de la propia AFASS; que aun cuando la reglamentación de la AFASS no proveía para el pago del exceso, ésta debía hacerlo para así evitar una si-tuación de enriquecimiento injusto a favor de dicha agen-cia pues fue ésta la que se benefició de los servicios pres-tados por el empleado mientras estuvo vigente la licencia sin sueldo; razón por la cual AFASS tenía el deber de sa-tisfacer al demandante la suma de dinero adeudada en concepto del exceso según dispuso el foro de instancia. Por no estar de acuerdo con la actuación del Tribunal de Circuito de Apelaciones, AFASS acudió en revisión —vía certiorari— ante este Tribunal. La peticionaria alega que procede revocar la sentencia emitida por el Tribunal de Circuito de Apelaciones, confirmatoria de la emitida por el foro de instancia, debido a que dicho foro apelativo incidió: ... al adjudicarle a AFASS el pago del exceso de licencias acu-muladas por concepto de vacaciones y enfermedad del señor Matos Nazario. Petición de certiorari, pág. 6. Expedimos el recurso; específicamente le ordenamos a las partes ilustrar al Tribunal sobre si la celebración de una vista evidenciaría en el presente caso era mandatoria, por ser una parte el Estado Libre Asociado de Puerto Rico, a pesar del hecho de que la controversia planteada era una estrictamente de derecho, y no de hechos.(10) Ambas partes —incluso la propia parte que levantó como error ante el tribunal apelativo que el foro de instancia hubiera dictado sentencia en contra del Estado sin la celebración de una *14vista previa— expresaron en sus respectivos alegatos estar de acuerdo en que la celebración de dicha vista no era ne-cesaria ya que no existe controversia de hecho alguna; in-cluso, no existiendo controversia sobre la suma de dinero adeudada al demandante.(11) Contando con la comparecen-cia de ambas partes, y estando en condiciones de resolver, procedemos a así hacerlo. M A. No obstante las aseveraciones de las partes, en torno a la no necesidad de la celebración de la vista en rebeldía en el presente como condición para que se dictare sentencia en contra del Estado Libre Asociado de Puerto Rico, consideramos pertinente expresarnos al respecto. La Regla 45.5 de Procedimiento Civil, ante, establece que:
Regla 45.5 Sentencia contra el Estado Libre Asociado de Puerto Rico
No se dictará ninguna sentencia en rebeldía contra el Estado Libre Asociado de Puerto Rico, sus municipios, agencias o ins-trumentalidades ni contra un funcionario en su carácter oficial, a menos que el reclamante pruebe, a satisfacción del tribunal, su reclamación o derecho al remedio que solicita. (12) *15Elio no obstante —y dados los hechos particulares del presente caso, en el cual ambas partes están contestes en que no hay hecho alguno en controversia y que únicamente el caso se circunscribe a resolver una cuestión de derecho, razón por la cual resulta totalmente innecesaria la celebra-ción de una vista evidenciaría a nivel de instancia— somos del criterio que devolver el caso al tribunal de instancia, para la celebración de una vista, sería un ejercicio en futi-lidad; razón por la cual nos abstenemos de hacerlo. B. La peticionaria AFASS alega que tanto el tribunal de instancia, como el tribunal intermedio apelativo, erraron al concluir que le correspondía a ésta satisfacer el pago del exceso en concepto de licencias de vacaciones y enfermedad que acumuló el señor Matos Nazario mientras rendía ser-vicios en AFASS, en virtud de una licencia sin sueldo con-ferida a éste por la ACT. No tiene razón. Plantea la peticionaria que la cuestión de derecho pre-sente en el caso de autos es una novel pues debemos deter-minar, como mencionáramos previamente, si la Ley Núm. 12, ante, sobre transferencias de licencias de vacaciones y enfermedad acumuladas por empleados gubernamentales dentro del servicio público, al éstos pasar de una entidad gubernamental a otra a rendir sus servicios, aplica cuando un empleado de una agencia obtiene una licencia sin sueldo para prestar servicios temporeros en otra agencia. Entendemos que las disposiciones del referido estatuto aplican a situaciones como las del caso de autos. Veamos. Comenzamos analizando la naturaleza de las licencias sin sueldo. Las mismas se consideran tradicionalmente como un privilegio que se concede a empleados regulares para que éstos se ausenten de su trabajo para proseguir estudios, adquirir experiencia provechosa para el servicio, y/o prestar servicios en otro lugar de trabajo. Precisamente se distinguen por ser un beneficio marginal concedido a empleados permanentes o regulares por cierto y determinado tiempo, conservando el puesto donde pres-*16tan servicios regularmente hasta su retorno.(13) La seguridad del retorno del empleado al puesto que ocupa es condición sine qua non para la concesión de dicha licencia sin sueldo, por lo que utilizar dicho permiso para brindar ser-vicios temporeros en otros lugares de trabajo no equivale a una renuncia al puesto original ni conlleva la desvincula-ción del empleado del puesto que ocupa.(14) La única limitación que conlleva la concesión de una licencia sin sueldo a un empleado es que dicho empleado no tendrá derecho a acumular licencias de vacaciones ni en-fermedad en su empleo regular de origen durante la vigen-cia de la misma. (15) El Reglamento de Personal de la Autoridad de Carreteras y Transportación Núm. 5523 de 3 de diciembre de 1996 (Reglamento de Personal de la ACT),(16) en virtud del cual se le concedió al demandante la licencia sin sueldo para prestar servicios en AFASS, específicamente dispone en su Art. 15, Sec. 15.4(10), pág. 115, que: a. Además de las licencias sin paga provistas en otras seccio-nes de este Reglamento, se concederán las siguientes: 1) A empleados con puestos regulares, para prestar servicios en otra agencia del Gobierno o entidad privada, de determi-narse que la experiencia que derive el empleado le resolverá una necesidad comprobada de adiestramiento a la Agencia o al servicio público. Además se señala, en lo pertinente a la licencia de va-caciones durante la vigencia de una licencia sin paga con-cedida a un empleado regular, en el mismo Art. 15, Sec. 15.4(10), págs. 117-118: *17e. Disposiciones Generales 3) Si a un empleado regular se le concede una licencia sin sueldo[,] no será menester que éste agote la licencia de vacacio-nes que tenga acumulada antes de comenzar en disfrute de licencia sin sueldo. En cuanto a las licencias por enfermedad y por vacacio-nes dispone:
Sección 15.4- Licencias
1. Licencia de Vacaciones c. Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. 2. Licencia por Enfermedad c. Los empleados podrán acumular su licencia por enferme-dad hasta un máximo de noventa (90) días laborables al finali-zar cada año natural. Reglamento de Personal de la ACT, ante, págs. 92-99. Por otra parte, el Reglamento de Personal para los Empleados de Carrera de la Administración de Facilidades y Servicios de Salud de 7 de junio de 1978, enmendado el 16 de mayo de 1990, págs. 85-90 (Reglamento de Personal de AFASS), en su Art. 11, Sec. 11.4, dispone, en lo pertinente a la concesión de licencias: 1- Licencia de Vacaciones c) Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. 2- Licencia por Enfermedad b) La licencia por enfermedad se podrá acumular hasta un *18máximo de noventa (90) días laborables al finalizar cada año natural. ... Al momento del demandante Matos Nazario acogerse al disfrute de una licencia sin sueldo en ACT, éste tenía un balance de licencia de vacaciones acumulada de cuarenta y seis y medio (46.5) días y noventa (90) días por concepto de enfermedad. De manera que, a dicho momento, no se había configurado un balance de licencias acumuladas en exceso del límite máximo reglamentario dispuesto por la ACT. Reseñadas las disposiciones reglamentarias, procede-mos a analizar las disposiciones de la Ley Núm. 12, ante, en cuanto a la transferencia del mencionado balance acu-mulado a AFASS, al momento en que el demandante co-menzó a rendir servicios profesionales en dicha agencia. La citada Ley 12 regula la transferencia de licencias de vacaciones regulares y por enfermedad que hayan acumulado los empleados públicos al pasar éstos de un puesto a otro en los servicios exentos, por oposición y sin oposición, del Gobierno de Puerto Rico. En su Art. 1 específicamente se dispone: Se autoriza la transferencia de licencia por vacaciones y por enfermedad, acumulada por un funcionario o empleado del Es-tado Libre Asociado de Puerto Rico al pasar de un puesto a otro en los Servicios Exento, por Oposición, o sin Oposición, del Go-bierno de Puerto Rico. (Enfasis suplido.(17) Este Tribunal, en el caso de Aut. de Puertos v. Mun. de San Juan, ante, se expresó en torno a la procedencia de la transferencia de vacaciones y de enfermedad acumuladas por un empleado, independientemente de que en la tran-sacción de personal concernida estuviesen implicadas agencias comprendidas en el servicio exento, por o sin oposición, enfatizando el hecho de que nunca se concibió dicha pieza legislativa como un mecanismo para que el empleado *19recibiera el pago de vacaciones y licencias acumuladas cuando éste pasaba de un servicio a otro, aun cuando de-terminadas agencias estuvieran excluidas de la Ley de Personal del Servicio Público. En dicho caso específicamente resolvimos que la transfe-rencia del balance de las licencias acumuladas por con-cepto de vacaciones y enfermedad es obligatoria para todas las agencias del Estado Libre Asociado de Puerto Rico. “La ley, en ese sentido, le impone a la agencia que recibe al empleado la obligación de acreditar y de aceptar las licen-cias acumuladas, siempre que el empleado pase de un puesto a otro o de una agencia a otra dentro del servicio público.” (Énfasis suplido.) Aut. de Puertos v. Mun. de San Juan, ante, pág. 507.(18) Expresamos, además, en el referido caso, ante pág. 504, que la Ley Núm. 12, ante, “intenta fomentar la movilidad de los empleados públicos entre las distintas agencias del Gobierno con independencia del servicio en que estos em-pleados se encuentren comprendidos. Su aplicabilidad, por ende, se extiende a las distintas transacciones de personal comprendidas dentro de los distintos servicios que componen el Gobierno de Puerto Rico, salvo cuando media la desvinculación total y definitiva del empleado del servicio público”. (19) (Énfasis suplido.) Enfatizamos en dicho caso el hecho de que en el Informe de la Cámara de Representan-tes sobre el P. del S. Núm. 91, se hizo constar que la falta de intercambio y ausencia de movilidad “no ayuda a fo-mentar el servicio de carrera público, puesto que, por el temor a perder las vacaciones o la licencia por enfermedad que tuvieren acumuladas, los empleados prefieren seguir *20en la misma agencia donde están laborando con perjuicio en innumerables ocasiones al propio desarrollo y mejora-miento del servicio público”(20) Llegamos a la conclusión en dicho caso, de que el legislador, al aprobar la Ley Núm. 12, ante, tuvo como propósito la creación de un instrumento que garantizara la permanencia del empleado dentro del servicio público, y que de igual modo se fomentara su mo-vilidad y capacidad de superación. Expresamos, por último, en el citado caso que el término “pasar” comprendido en dicho estatuto es uno que abarca a todo el personal del servicio público; “[e]ste término pasar de un puesto a otro o de agencia a otra es de carácter am-plio y abarca a todo el sistema de personal del servicio público”. (Énfasis suplido y en el original.) Aut. de Puertos v. Mun. de San Juan, ante, pág. 508. Esto añadido a la determinación que hiciéramos en ese mismo caso en rela-ción a que la aplicabilidad de la Ley 12, ante, “se extiende a las distintas transacciones de personal comprendidas dentro de los distintos servicios que componen el Gobierno de Puerto Rico, salvo cuando media la desvinculación total y definitiva del empleado del servicio público”. íd., pág. 504. Resulta, en consecuencia, totalmente lógica y procedente la conclusión de que la concesión de una licencia sin sueldo a un empleado, para que éste pase de una agencia de gobierno a prestar servicios profesionales temporeros en otra agencia, está debidamente comprendida dentro de las transacciones de personal abarcadas por la citada Ley Núm. 12. “ ‘Es principio cardinal de hermenéutica el que a las palabras [y] al lenguaje de una ley, debe dársele la interpretación que valid [a] el propósito que tuvo el legislador *21al aprobar la medida’.” Muñoz Hernández v. Policía de P.R., 134 D.P.R. 486, 497 (1993). Véase Rivera Maldonado v. Autoridad Sobre Hogares, 87 D.P.R. 453, 456 (1963). Enfatizamos y recalcamos, nuevamente, que según lo resuelto en el caso Aut. de Puertos v. Mun. de San Juan, ante, el término “pasar” es uno de carácter amplio y que específicamente determinamos en dicho caso, luego de analizar la intención del legislador al aprobar la Ley Núm. 12, que las disposiciones de dicha Ley le aplican a las distintas transacciones de personal dentro del servicio público, excepto cuando media la separación del empleado del mismo. En el caso de autos, es evidente que el Matos Nazario pasó de una agencia a otra cuando inicialmente fue a brindar servicios profesionales de la ACT a AFASS y que luego, por segunda ocasión, pasó nuevamente a la ACT al concluirse el término de vigencia de la referida licencia. El señor Matos nunca se retiró ni renunció del servicio público, continuó rindiendo servicios dentro del mismo ofreciendo su trabajo profesional a dos entes gubernamentales distintos sin interrupción alguna en el rendimiento del mismo. (21) Aplicando, pues, esta normativa al caso de autos, con-cluimos que el foro apelativo intermedio actuó correcta-mente al resolver que, al pasar el señor Matos de la ACT a la AFASS, ésta última tenía que acreditarle los balances de licencia por vacaciones y por enfermedad acumulados en su empleo anterior, independientemente de que el traslado se hubiera hecho a través de una licencia sin sueldo. Situa-ción idéntica ocurre cuando el señor Matos se reintegra a su puesto original en la ACT, en cuyo caso procedía una segunda transferencia de los balances mencionados. Ya en *22ese momento era patentemente claro que procedía dicha transferencia pues el demandante renunció a su puesto en AFASS para reintegrarse a sus funciones en la ACT.(22) C. Aclarado el planteamiento sobre si procedía o no la transferencia de balances acumulados cuando el traslado de un empleado se da a través de una licencia sin sueldo, pasamos a examinar qué ocurre con la cantidad de días y balances máximos transferibles por ley al darse las dos transferencias en cuestión. Ordena la referida Ley Núm. 12, ante, en su Art. 2, que: Cuando un funcionario o empleado del Gobierno del Estado Libre Asociado de Puerto Rico pase de una agencia a otra com-prendida dentro de los Servicios Exento, por Oposición, o sin Oposición, la agencia en que él trabaja certificará, y la agencia que adquiera sus servicios aceptará y acreditará, el número de días, por vacaciones y por enfermedad acumulados por dicho funcionario o empleado, según el sistema de licencia en vigor en cada Servicio. 3 L.P.R.A. sec. 697. Por otra parte, el Art. 3 dispone que: El máximo de licencia transferible será de 60 días en el caso de licencia por vacaciones y de 90 días en el caso de licencia por enfermedad. 3 L.P.R.A. see. 698. Por mandato específico de Ley, al darse la transferencia de los balances de licencias acumulados por un empleado efectuada en base a una transacción de personal debidamente autorizada, dicha transferencia se da solo hasta un máximo de sesenta días por concepto de vacaciones, y en relación con la licencia por enfermedad, hasta un *23máximo de noventa (90) días.(23) Al pasar de un puesto a otro dentro del servicio público, el empleado o funcionario tiene el derecho y seguridad de que los balances acumula-dos en su puesto de origen, se transfieran intactos a la agencia o instrumentalidad a la cual va a rendir sus servi-cios profesionales. Es por tal razón que este foro se vio en la necesidad de resolver, y resolvió, en Aut. de Puertos v. Mun. de San Juan, ante, pág. 510, que “[p]uesto que la Ley Núm. 12, ante, dispone la cantidad máxima de licencia transferible, nada impide que en aquellos casos en que un empleado pasa a ocupar otra posición en otra agencia o rama de go-bierno comprendida en el servicio público, y que ha acumu-lado más de sesenta (60) días en el caso de licencia por vacaciones y/o de noventa (90) días de licencia por enfer-medad, le pueda pagar la agencia o rama de gobierno en que el empleado cesa de laborar el exceso en efectivo cuando así los disponga la reglamentación correspondiente de dicha agencia o rama de gobierno”.(24) (Énfasis suplido y en el original.) De manera que, una agencia o instrumentalidad de go-bierno puede satisfacer el pago del exceso por días acumu-lados en licencias de vacaciones y enfermedad, a un em-pleado suyo que pasa a ocupar otra plaza dentro del servicio público, si es que así su reglamentación de personal lo dispone. Cumpliendo con la obligación de ley im-puesta por el estatuto antes mencionado, al pasar el señor Matos de la ACT a AlFASS inicialmente, la segunda tenía que acreditarle los balances acumulados por éste en la *24ACT. Es decir, era su deber acreditar el balance de cua-renta y seis y medio (46.5) días de licencia de vacaciones y noventa (90) días por enfermedad. Hay que enfatizar el he-cho de que en el presente caso, al darse el traslado original, en ninguna de las dos licencias se había acumulado en ex-ceso del máximo reglamentario ni en exceso del máximo transferible estatuido en la Ley Núm. 12. En consecuencia, nos vemos en la obligación de resolver que el señor Matos Nazario acumuló el exceso en ambas licencias mientras rendía servicios profesionales en la AFASS. Al éste acumular cuarenta y dos (42) días de vaca-ciones y treinta y seis y medio (36.5) días por enfermedad en AFASS, esto añadido a los balances que se debieron ha-ber acreditado de la ACT, se configuró un exceso de vein-tiocho y medio (28.5) días de vacaciones y de treinta y seis y medio (36.5) días de enfermedad. Al demandante regre-sar o reintegrarse a sus servicios en la ACT, sólo se pudo haber transferido hasta el máximo dispuesto por ley. A dicha fecha había acumulado días de licencia por vacaciones y enfermedad en exceso de lo establecido en el reglamento de AFASS. Le correspondía, por tanto, a AFASS —al mo-mento de la segunda transferencia— satisfacerle en efec-tivo al demandante el exceso acumulado en ambas vacacio-nes, si es que el Reglamento de Personal de AFASS provee para el pago de dichos excesos. En virtud de su ley habilitadora, la AFASS es un “administrador individual” en asuntos de personal.(25) Dicha agencia aprobó su propio Reglamento de Personal el 7 de junio de 1978. El mismo dispone que los empleados podrán acumular licencia de vacaciones hasta un máximo de sesenta (60) días laborables y hasta un máximo de noventa (90) días por enfermedad. No obstante, dicho reglamento no provee —como tampoco prohíbe— para el pago en efec-*25tivo del exceso por días acumulados en licencias de vaca-ciones y enfermedad. Resolvemos que, no obstante las circunstancias particu-lares de la agencia —AFASS— que recibió los servicios del empleado, la cual no tenía reglamentación en cuanto al pago del exceso por concepto de licencias acumuladas, le corresponde a dicha agencia satisfacer el pago en efectivo por el exceso de dichas licencias de vacaciones y enferme-dad acumulado mientras éste rindió servicios bajo su su-pervisión; ello por dos razones: en primer lugar, el regla-mento de AFASS no lo prohíbe; en segundo término, de esta manera evitamos una situación de enriquecimiento injusto de parte de dicha agencia y en perjuicio del empleado, que no podría recibir dicha compensación de otra manera. Esto por razón de que fue precisamente en dicha agencia que el demandante acumuló dicho exceso. El mismo surgió a raíz de la prestación de servicios en virtud de la licencia sin paga que le fue concedida por la ACT. La doctrina de enriquecimiento injusto está predicada en la equidad. Al igual que otras acciones basadas en los principios de equidad, la reclamación por enriquecimiento injusto sólo procederá cuando no exista ley que provea para otra causa de acción. Ortiz Andújar v. E.L.A., 122 D.P.R. 817 (1988). Los siguientes elementos tienen que concurrir para que se dé una debida aplicación de dicha doctrina, a saber; existencia de un enriquecimiento, un correlativo empobrecimiento; conexión entre dicho enriquecimiento y el empobrecimiento; falta de causa de acción que justifique el enriquecimiento; inexistencia de precepto legal que excluya la aplicación del enriquecimiento sin causa. Ortiz Andújar v. E.L.A, ante; Morales v. Municipio de Toa Baja, 119 D.P.R. 682 (1987). Es norma de derecho reconocida que esta doctrina es de aplicación, en determinadas ocasiones, a organismos administrativos. Véase Plan Bienestar Salud v. Alcalde Cabo Rojo, 114 D.P.R. 697 (1983). En Hatton v. Mun. de *26Ponce, 134 D.P.R. 1001, 1010 (1994), expresamos, al definir los contornos de esta doctrina, que la misma “no se aplicará cuando resulte contrari[a] a una clara política pública, plasmada en un estatuto o en la Constitución”. (Enfasis en el original suprimido y énfasis suplido.) Precisamente por ello es que la doctrina de enriquecimiento injusto es de aplicación en el presente caso. Constituye una clara política pública,(26) que debe ser fomentada, la de garantizar la movilidad de los empleados públicos entre las distintas agencias y dependencias del Gobierno de Puerto Rico y de que éstos no sean penalizados por ello en forma alguna, esto es, y en lo pertinente, dichos empleados tienen el derecho a disfrutar del exceso de vacaciones que acumulan y/o que se le satisfaga en efectivo dicho exceso. Cuando no se permite el disfrute de la *27licencia de vacaciones acumuladas y luego tampoco se per-mite el pago de dicha licencia, ello claramente constituye una situación de enriquecimiento injusto por parte del or-ganismo gubernamental concernido.(27) El señor Matos Nazario rindió servicios y laboró du-rante dos años consecutivos para la AFASS; dicha agencia se benefició de su trabajo. Al culminar sus labores en dicha agencia, y reintegrarse a sus labores en la ACT, careció de oportunidad de disfrutar dicho exceso acumulado en licen-cias, por lo que procede indemnizarlo de la única forma posible, el pago en efectivo de dicho exceso. No puede ne-gársele el mismo bajo el fundamento de que el reglamento de la AFASS no provee para dicho pago. Es evidente y nunca se cuestionó el hecho de que el señor Matos Nazario acumuló dicho exceso y que no lo pudo disfrutar en mo-mento alguno. El hecho de que el señor Matos Nazario no hubiera te-nido oportunidad de disfrutar de sus licencias acumuladas de enfermedad y de vacaciones, no debe perjudicar a éste toda, vez que no debemos penalizarle por la falta de diligen-cia de AFASS. Rodríguez Cruz v. Padilla Ayala, 125 D.P.R. 486 (1990). De concluir que no procede el pago, AFASS es-taría beneficiándose del trabajo realizado por el deman-dante aun cuando fue evidente que el exceso acumulado se configuró mientras éste rindió servicios para dicha agencia. Repetimos, no puede negársele el referido pago bajo el fundamento de que el reglamento de la AFASS no provee para el mismo. La alternativa de dejar desprovisto de ello al empleado no es aceptable. La conclusión a la que hoy llegamos refleja fielmente la intención del legislador referente a las disposiciones sobre transferencias de balances de licencias de vacaciones y en-fermedad acumulados por empleados y funcionarios públi-cos, independientemente de cuál sea la transacción de per*28sonal comprendida; todo ello en aras de fomentar una administración de personal eficiente que inspire a los ser-vidores públicos a fomentar una carrera profesional dentro del gobierno central sin obstáculos que impidan su movili-dad dentro del sistema. Por otro lado, no podemos dejar desprovisto de indemni-zación, por concepto de licencias de vacaciones y enferme-dad acumuladas y no disfrutadas, a un servidor público que aportó todo su conocimiento y experiencia a dos depen-dencias gubernamentales que evidentemente se beneficia-ron de tales servicios. (28)
Se dictará sentencia de conformidad.
El Juez Presidente Señor Andréu García y el Juez Asociado Señor Fuster Berlingeri concurrieron con el resultado sin opinión escrita. El Juez Asociado Señor Corrada Del Río se inhibió.
(1) La licencia originalmente concedida por el periodo de un año, le fue exten-dida por un año adicional, a solicitud del propio demandante, debido a que el Director Ejecutivo de la Administración de Facilidades y Servicios de Salud (AFASS) interesaba retener sus servicios. Véase Apéndice, pág. 50. El Reglamento de Personal de la Autoridad de Carreteras y Transportación Núm. 5523 de 3 de diciembre de 1996 (Reglamento de Personal de la ACT), dispone en su Art. 15, Sec. 15.4(10), pág. 115: “10. Licencia sin Paga “a. Además de las licencias sin paga provistas en otras secciones de este Regla-mento, se concederán las siguientes: “1) A empleados con puestos regulares, para prestar servicios en otra agencia del gobierno o entidad privada, de determinarse que la experiencia que derive el empleado le resolverá una necesidad comprobada de adiestramiento a la agencia o al servicio público.”
(2) Dichos balances supuestamente quedaron en estado de suspenso durante el tiempo de vigencia de la licencia sin sueldo. Comunicación del Ing. Sergio L. González, Director Ejecutivo de la Autoridad de Carreteras y Transportación (Director Ejecutivo de la ACT) a la Leda. Marta Rivera Plaza, Directora Ejecutiva de AFASS. Apéndice, págs. 52-53.
(3) Véase Apéndice, pág. 51 (Carta de 5 de diciembre de 1995 de la Jefa Interina de Área de Personal de AFASS dirigida al Ing. Sergio González, Director Ejecutivo de la ACT).
(4) El Reglamento de Personal de la ACT, ante, págs. 92-99, dispone, en su See. 15.4 sobre Licencias: “1. Licencia de Vacaciones “c. Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. “2. Licencia por Enfermedad “e. Los empleados podrán acumular su licencia por enfermedad hasta un máximo de noventa (90) días laborables al finalizar cada año natural.” El Reglamento de Personal para los Empleados de Carrera de la Administración de Facilidades y Servicios de Salud de 7 de junio de 1978, enmendado el 16 de mayo de 1990 (Reglamento de Personal de AFASS), págs. 85-90, dispone, en su Art. 11, Sec. 11.4 sobre Licencias: “1. Licencia de Vacaciones *8“c) Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. “2. Licencia por Enfermedad “b) La licencia por enfermedad se podrá acumular hasta un máximo de no-venta (90) días laborables al finalizar cualquier año natural. ...” La suma de los días acumulados en ambas dependencias por concepto de licen-cias conlleva un total de ochenta y ocho días y medio (88.5) acumulados por concepto de vacaciones y ciento veintiséis (126) días por enfermedad; configurándose así un exceso de veintiocho días y medio (28.5) por vacaciones y treinta y seis días y medio (36.5) por enfermedad.
(5) Véase Resolución notificada el 31 de julio de 1997. Apéndice, pág. 64.
(6) Véase Orden del Tribunal de Primera Instancia, Sala de San Juan. Apéndice, pág. 76.
(7) Véase Minuta del Tribunal de Primera Instancia, vista transaccional cele-brada el 18 de agosto de 1998. Apéndice, pág. 79.
(8) En dicho recurso, imputó al Tribunal de Primera Instancia la comisión de los siguientes errores: “Erró el Honorable Tribunal de Primera Instancia al dictar Sentencia en Rebel-día contra la Administración de Facilidades y Servicios de Salud (AFASS) sin que el demandante haya probado en el juicio en su fondo que tenía derecho al remedio solicitado, como dispone la Regla 45.5 de las de Procedimiento Civil de 1979. “Erró el Honorable Tribunal de Primera Instancia al no acoger la solicitud de la Administración de facilidades y Servicios de Salud (AFASS) presentada en su Moción de Reconsideración, de dejar sin efecto la anotación de rebeldía contra el Estado. “Erró el Honorable Tribunal de Primera Instancia al imponerle a la Adminis-tración de Facilidades y Servicios de Salud (AFASS) el pago del exceso Acumulado de bcencia por vacaciones y de enfermedad durante el ofrecimiento de los servicios profesionales del demandante en AFASS.” Apéndice, pág. 21.
(9) La Regla 45.5 dispone: “No se dictará ninguna sentencia en rebeldía contra el Estado Libre Asociado de Puerto Rico, sus municipios, agencias o instrumentalidades ni contra un funcionario en su carácter oficial, a menos que el reclamante pruebe, a satisfacción del tribunal, su reclamación o derecho al remedio que solicita.”
(10) Resolución del Tribunal Supremo de Puerto Rico de 31 de julio de 2000.
(11) Nos señala la peticionaria AFASS en su alegato ante este Tribunal: “Enten-demos que una vista en el caso de autos no era necesaria. [E]n el caso de autos lo que existe es una controversia de derecho a los efectos de establecer a qué agencia le corresponde el pago del exceso de licencias acumuladas cuando el mismo surge de una licencia sin sueldo que una agencia le otorga a un empleado para que preste servicios temporeros en otra. Una vista evidenciaría no hubiese variado la anterior controversia de derecho.” Alegato, págs. 6-7. Por su parte, nos señala la recurrida ACT en su respectivo alegato, “en el caso de autos no existe, ni existió nunca una controversia genuina de hechos. La única controversia existente ... era una de DERECHO. Por lo tanto, la celebración de una vista evidenciaría en nada iba a abonar a la tramitación expedita y justa del caso de epígrafe ... lo que restaba por realizar era dictar sentencia aplicando el derecho a los hechos incontrovertidos”. Alegato de la parte recurrida, Autoridad de Carreteras y Transportación, pág. 6.
(12) Véanse: R. Hernández Colón, Práctica Jurídica de Puerto Rico: Derecho Procesal Civil, San Juan, Ed. Michie de Puerto Rico, 1997, pág. 218; J.A. Cuevas Segarra, Tratado de Derecho Procesal Civil, San Juan, Pubs. J.T.S., 2000, T. II, pág. 760.
(13) Véase Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993.
(14) Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993.
(15) Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993.
(16) El Reglamento de Personal de la ACT, ante, anuló el Reglamento Núm. 4769 de 6 de agosto de 1992, vigente al momento en que se le concedió la licencia sin paga al demandante. Ambos disponen exactamente lo mismo en cuanto a la concesión de licencias sin paga.
(17) 3 L.P.R.A. sec. 696.
(18) Véanse, además: Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993, pág. 2, “cuando un funcionario o empleado pasa de un puesto a otro en el servicio público, ... la transferencia de las licencias de vacaciones y por enfer-medad acumuladas es obligatoria.”; Consulta del Secretario de Justicia Núm. 882-93-B de 14 de octubre de 1993; Op. Sec. Just. Núm. 29 de 1ro de diciembre de 1992.
(19) Véase, además, Informe de la Cámara de Representantes sobre el P. del S. 91 de 31 de marzo de 1953.
(20) Aut. de Puertos v. Mun. de San Juan, ante, págs. 504-505. Reseñó este tribunal al concluir su poneneia:“La norma que hoy adoptamos promueve los objeti-vos de fomentar la carrera en el servicio público y la movilidad como pilares funda-mentales para una sana administración pública.... Esta norma beneficia tanto al empleado como al servicio público”. Aut. de Puertos v. Mun. de San Juan, ante, pág. 510.
(21) Una vez concluido el periodo de dos años de licencia sin sueldo, el señor Matos Nazario renunció a su puesto de confianza en AFASS efectivo el viernes 13 de octubre de 1995, para así reintegrarse el próximo lunes 16 de octubre, a sus labores en la ACT, sin que mediara interrupción o desvinculación alguna del sistema de servicio público.
(22) No debemos olvidar tampoco lo resuelto por este foro en el caso Rodríguez Cruz v. Padilla Ayala, 125 D.P.R. 486, 516 (1990), en cuanto a que “solamente pro-cede la liquidación de las vacaciones acumuladas mediante el pago en efectivo de las mismas cuando la renuncia o separación del servicio produce la desvinculación del empleado del servicio”. (Énfasis suprimido.) En dicho caso determinamos que el tribunal de instancia había incidido al ordenar al pago de cierta cantidad de días por concepto de vacaciones no disfrutadas. Tal decisión corrobora más atan lo resuelto hoy por este tribunal al disponer que procede la transferencia de los balances de licencias acumulados por el demandante, cuando inicialmente acudió a rendir servi-cios en AFASS y cuando nuevamente se reintegró a su puesto en la ACT.
(23) Véanse, además: Aut. de Puertos v. Mun. de San Juan, ante; Op. Sec. Just. Núm. 29 de 1ro de diciembre de 1992; Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993; Consulta del Secretario de Justicia Núm. 882-93-B de 14 de octubre de 1993.
(24) Es norma de derecho administrativo que la reglamentación de personal de una corporación pública constituye la fuente de todos los derechos de sus funciona-rios y empleados en cuanto a todo lo relativo a la acumulación, concesión, disfrute y pago global de las licencias de vacaciones y por enfermedad. Consulta Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993, pág. 3.
(25) Ley Núm. 26 de 13 de noviembre de 1975 (24 L.P.R.A. ant. sec. 337d).
(26) El 20 de agosto de 1996, se aprobó la Ley Núm. 156, a los efectos de conceder a las agencias gubernamentales la facultad de pagar anualmente a los empleados las licencias de vacaciones y de enfermedad acumuladas y no disfrutadas en exceso de lo establecido por reglamentación. Mediante tal estatuto, se propuso un cambio en las facultades de las agencias, para que éstas tuvieran la opción de conceder a sus empleados el derecho al pago anual de licencias acumuladas y no disfrutadas por concepto de vacaciones y enfermerdad en exceso a lo reglamentado. Exposición de Motivos de la Ley Núm. 156 de 20 de agosto de 1996, Leyes de Puerto Rico 680-681. Hasta tal momento, debido a la limitación del pago de una suma global por concepto de licencias acumuladas sólo a la separación del servicio, la mayoría de las agencias sólo concedían a sus empleados el beneficio de disfrutar del exceso de licen-cia acumulada sobre el límite de 60 días, cuando no hubieran podido disfrutar de dicha licencia por necesidades del servicio. El no aprobar esto último implicaba la pérdida del exceso de licencia acumulada y no disfrutada. Esta medida tuvo pues el propósito de evitar dicha situación y premiar al empleado público que utiliza sus licencias de manera razonable, dándole pues el beneficio de concederle el mecanismo del pago en efectivo del exceso acumulado en licencias y no disfrutado. La aprobación de dicho estatuto nos ilustra sobre la intención del legislador de no permitir que empleados públicos que hubieran acumulado exceso de licencias, se vieran impedidos de obtener una cantidad de dinero por concepto de dicho exceso, máxime cuando la reglamentación de las respectivas agencias no disponían sobre el modo de satisfacer dicho pago. De manera que no resulta difícil llegar a la razonable conclusión sobre disponer tal pago, aun cuando este estatuto no hubiera estado vi-gente al momento en que el demandante pasó de la AFASS a reintegrarse a sus labores en la ACT. Hay que tener en mente que “toda acción legislativa persigue un propósito. Trata de corregir un mal, alterar una situación existente, complementar una regla-mentación vigente, fomentar algún bien específico o el bienestar general, reconocer o proteger un derecho ...”. R.E. Bernier y J.A. Cuevas Segarra, Aprobación e interpretación de las leyes en Puerto Rico, San Juan, Pubs. J.T.S., 1987, Vol. 1, págs. 245-246.
(27) Véase Op. Sec. Just. Núm. 29 de 1ro de diciembre de 1992, interpretando a Rodríguez Cruz v. Padilla Ayala, ante.
(28) El Reglamento de Personal de AFASS, en su Art. 11, Sec. 11.4(1)(g), sola-mente dispone para que el empleado que ha acumulado en exceso de licencia sobre el límite de sesenta (60) días, disfrute de dicho exceso en la fecha más próxima posible, dentro del término de los primeros seis (6) meses del siguiente año natural. Esta disposición reglamentaria no tiene ningún efecto en cuanto a la situación del señor Matos Nazario, pues al éste pasar ininterrumpidamente de la AEASS a la ACT, al concluir la licencia sin sueldo, perdió toda oportunidad para disfrutar dicho exceso. Brindarle esa oportunidad en estos momentos no tendría ninguna razón de ser. Además, no podemos ordenarle a la ACT que conceda en estos momentos el disfrute del exceso, pues fue precisamente en la AEASS donde el empleado lo acu-muló y fue en esa agencia donde no pudo disfrutarlo. No podemos tampoco exigir a la ACT que conceda dicho exceso, pues estaríamos penalizándola por la falta de dili-gencia de AFASS al no procurar que el demandante disfrutara de sus vacaciones en la forma más compatible con el plan de vacaciones y enfermedad en vigor en dicha agencia. | 11-23-2022 | [
"EL Juez Asociado Señor Rebollo López emitió la opinión del Tribunal. La controversia a resolver en el presente caso es si las disposiciones de la Ley Núm. 12 de 5 de mayo de 1953, según enmendada, 3 L.P.R.A. secs. 696-698, sobre transfe-rencia de licencia por vacaciones y por enfermedad, entre el Servicio Exento y los Servicios por Oposición o sin Oposición del Personal del Gobierno de Puerto Rico, aplican a situaciones en que un empleado de una agencia o instru-mentalidad del Gobierno de Puerto Rico solicita y obtiene una licencia sin sueldo para prestar servicios temporeros en otra agencia o instrumentalidad; de concluir en la afir-mativa, debemos determinar a cuál de las dos agencias o instrumentalidades le corresponde hacer el pago del exceso por licencias de vacaciones y enfermedad acumuladas, cuando dicho exceso surge a raíz de la prestación de servi-cios en virtud de la mencionada licencia sin paga. Ala luz de lo resuelto en Aut. de Puertos v. Mun.",
"de San Juan, 123 D.P.R. 496 (1989), concluimos que las disposiciones de la Ley Núm. 12, ante, aplican a situaciones como las del caso de autos. La agencia, instrumentalidad o corpora-ción pública que obtiene los servicios del empleado en vir-tud de una licencia sin sueldo, está obligada a aceptar la transferencia del balance máximo transferible por dicha ley, en concepto de licencias por vacaciones y enfermedad acumuladas en su empleo regular. Dicho de otra manera, el balance que tenga el empleado acumulado hasta el mo-mento en su puesto original se transfiere, hasta el límite máximo transferible, a la segunda dependencia a la cual pasa al amparo de la licencia sin sueldo que le fue conce-dida por la primera. Así las cosas, cuando el empleado re-ingrese a su puesto original, luego de haber concluido su licencia sin sueldo, se da una segunda transferencia de los balances acumulados por concepto de vacaciones y enfer-medad en la segunda agencia, de conformidad con el límite máximo transferible dispuesto en la Ley Núm. 12, ante. *6Resolvemos que, no obstante las circunstancias particu-lares de este caso, en donde la agencia que recibió los ser-vicios del empleado no tenía reglamentación aprobada en cuanto al pago del exceso por concepto de licencias acumu-ladas, le corresponde de todas maneras a dicha agencia satisfacer el pago por el exceso de dichas licencias de vaca-ciones y enfermedad acumulado mientras éste rindió ser-vicios bajo su supervisión. HH El demandante recurrido, Narciso E. Matos Nazario, se desempeñó por aproximadamente diecinueve (19) años como ingeniero civil en la Autoridad de Carreteras y Transportación (en adelante ACT) hasta el 30 de septiembre de 1993.",
"En dicha fecha le fue concedida una licencia sin sueldo por la ACT para que éste pasara a prestar servicios temporeros en un puesto de confianza en la Administración de Facilidades y Servicios de Salud (en adelante AFASS), tarea que realizó por dos (2) años consecutivos, desde el 1 de octubre de 1993 hasta el 13 de octubre de 1995. (1) Al momento de serle concedida al demandante la referida li-cencia sin sueldo, en octubre de 1993, éste tenía acumula-dos en la ACT, cuarenta y seis y medio (46.5) días por con-cepto de licencia de vacaciones y noventa (90) días de *7licencia por enfermedad.CO Por otra parte, durante los dos (2) años que rindió servicios en AFASS, éste acumuló allí cuarenta y dos (42) días de licencia de vacaciones y treinta y seis y medio (36.5) días por enfermedad. (3) Una vez concluido el periodo de dos (2) años de licencia sin sueldo, el señor Matos Nazario renunció a su puesto de confianza en AFASS, efectivo el viernes 13 de octubre de 1995, para así reintegrarse el próximo lunes 16 de octubre, a sus labores en la ACT, sin que mediara interrupción o desvinculación alguna del sistema de servicio público. Una vez reintegrado a su puesto original en la ACT, el señor Matos Nazario reclamó en varias ocasiones, tanto a la ACT como a AFASS, el pago de licencias por vacaciones y enfer-medad acumuladas en exceso del máximo reglamentario establecido para dichas licencias en ambas dependencias. (4) La ACT negó su responsabilidad en cuanto al pago del exceso reclamado, mediante carta dirigida al demandante *8con fecha de 11 de julio de 1996.",
"En dicha carta, la ACT alegó que no tenía obligación alguna de pagar el exceso de licencias acumuladas logrado mientras prestaba servicios en AFASS, y que era a esta agencia a quien le correspondía desembolsar dicho exceso. AFASS, por su parte, rechazó todo tipo de responsabilidad en cuanto al pago del exceso de días acumulados, mediante carta dirigida al Director Ejecutivo de la ACT, Ing. Sergio González, con fecha de 14 de octubre de 1996. Finalmente, mediante carta de 25 de noviembre de ese mismo año, dirigida al demandante por la ACT, ésta resol-vió acreditarle a éste trece y medio (13.5) días de vacacio-nes de los cuarenta y dos (42) que éste acumuló en AFASS para así cumplir con el máximo reglamentario de sesenta (60) días y no le acreditó ninguno de los treinta y seis y medio (36.5) días que éste acumuló por enfermedad en tal lugar por razón de que el demandante ya había acumulado el tope de noventa (90) días reglamentario.",
"Alegó ACT, ade-más, que era a AFASS a quien le correspondía satisfacer el balance restante por concepto de vacaciones (28.5 días) y el exceso acumulado por concepto de enfermedad (36.5 días). El 3 de junio de 1997, el Sr. Matos Nazario radicó una reclamación ante la Junta de Apelaciones del Sistema de Administración de Personal (JASAP), solicitando la resolu-ción del “impasse existente” entre la ACT y la AFASS en cuanto a cuál de las dos correspondía realizar el pago del exceso reclamado por concepto de licencia de vacaciones y *9enfermedad. JASAP desestimó dicha reclamación alegando que, por disposición de la Sec. 7.14 de la Ley de Personal del Servicio Público de Puerto Rico, Ley Núm. 5 de 14 de octubre de 1975 (3 L.P.R.A. sec. 1394), no tenía jurisdicción en cuanto a la reclamación del señor Matos Nazario, pues dicha sección de ley le impide entender en reclamaciones instadas por empleados de confianza.",
"(5) Así las cosas, el 11 de septiembre de 1997, el señor Ma-tos Nazario radicó demanda civil sobre reclamación de sa-larios ante la Sala de San Juan del Tribunal de Primera Instancia, solicitando de dicho foro que determinara a cual de las dos, la ACT o la AFASS, le correspondía satisfacer la cantidad de dinero a la cual era acreedor por virtud del exceso en licencias que había acumulado por vacaciones y por enfermedad mientras trabajaba en AFASS. Solicitó, además, el demandante que dicho foro dictara sentencia a su favor disponiendo el pago del exceso en cuestión, por la cantidad ascendente a catorce mil novecientos cincuenta dólares ($14,950), que alegó era la cantidad monetaria adeudada por concepto de dicho exceso. Reclamó, por úl-timo, indemnización por gastos, costas y una suma razona-ble por honorarios de abogado. La ACT contestó la demanda el 22 de septiembre de 1997, negando toda responsabilidad sobre la deuda recla-mada y radicó demanda contra co-parte contra AFASS, aduciendo que ésta era la única responsable de liquidar el exceso de licencia regular y por enfermedad acumulado por el demandante durante su incumbencia y trabajo para dicha agencia. A finales de enero de 1998, el Estado Libre Asociado de Puerto Rico, en representación de AFASS, con-testó la referida demanda, alegando que no estaba obligado a pagar al demandante dinero alguno por el exceso acumu-lado de licencias, correspondiendo dicho pago a la ACT.",
"Así las cosas, el 4 de febrero de 1998, el Tribunal de Primera Instancia ordenó a los abogados y clientes a re-*10unirse con el propósito de llegar a ciertos acuerdos y a una posible transacción, dada la naturaleza de los asuntos planteados. (6) Conforme a tal orden, los abogados de las partes celebraron una reunión el 27 de mayo de dicho año. En una moción informativa radicada por la parte deman-dante, se le notificó al tribunal sobre lo acontecido en dicha reunión, a saber: que las partes habían llegado a un con-senso en cuanto a las controversias a ser dirimidas habían acordado solicitar señalamiento de vista para discutir el estado de los procedimientos, sugiriendo como fecha para dicha vista el 18 ó 19 de agosto de 1998. A base de tal sugerencia, se celebró una vista transaccional el 18 de agosto.",
"A ésta, comparecieron los representantes legales del demandante y de la ACT, pero no así la representación legal de AFASS. De acuerdo a la “minuta” que recoge los procedimientos acaecidos durante dicha vista, en dicho día se debía infor-mar al tribunal sobre si el Departamento de Justicia —en representación de AFASS— estaba en disposición de llegar a un acuerdo para pagar las sumas reclamadas. Por razón de la incomparecencia de la representación legal de AFASS, se le concedió al Departamento de Justicia el tér-mino de quiñce (15) días para informar al tribunal su po-sición y para mostrar causa por la cual no debían ser eli-minadas sus alegaciones. (7) Dicho foro señaló, además, la celebración de la conferencia con antelación al juicio para el día 7 de octubre de 1998.",
"El Departamento de Justicia respondió mediante mo-ción el 31 de agosto de ese mismo año, excusando su incom-parecencia a la vista del 18 de agosto, solicitando treinta (30) días adicionales para expresar su posición respecto a *11la reclamación entablada en su contra y solicitando, ade-más, la transferencia de la conferencia con antelación al juicio para fecha posterior, sugiriendo, entre otras fechas, el 12 de noviembre de 1998. El tribunal accedió a tal soli-citud, mediante orden del 15 de septiembre de ese año, transfiriendo la mencionada conferencia para el 12 de no-viembre de 1998. Llegado tal día, comparecieron a dicha conferencia las representaciones legales del demandante y de la ACT, no compareciendo, por segunda ocasión, la representación legal de AFASS. Según consta en la “minuta” de la conferen-cia, el tribunal procedió a eliminar las alegaciones de AFASS y a anotarle la rebeldía por razón de las múltiples incomparecencias de dicha parte e incumplimientos con las órdenes del tribunal, haciéndose constar el hecho de que ya el Departamento de Justicia había sido apercibido previa-mente sobre las posibles consecuencias de sus incumplimientos. AFASS, representado por el Departa-mento de Justicia, solicitó reconsideración, esto es, que se dejara sin efecto la anotación de rebeldía en su contra, la cual fue denegada de plano por el foro de instancia.",
"El tribunal de instancia procedió a dictar sentencia en rebeldía en contra de AFASS, sin la celebración de una vista en su fondo, archivándose en autos copia de la misma el día 30 de julio de 1999. Impuso a AFASS el pago inme-diato al demandante de la suma de catorce mil novecientos cincuenta dólares ($14,950), en virtud del exceso de 28.5 días acumulados por éste en concepto de licencia de vaca-ciones y de 36.5 días acumulados en concepto de enferme-dad, correspondiente al periodo de tiempo en que ofreció servicios profesionales en AFASS a raíz de la licencia sin sueldo que le fue concedida por la ACT. El foro de instancia basó su decisión en lo resuelto por este Tribunal en el caso Aut.",
"de Puertos v. Mun. de San Juan, ante. *12Inconforme, AFASS presentó recurso de apelación ante el Tribunal de Circuito de Apelaciones, el cual confirmó la sentencia dictada por el foro de instancia. (8) El foro apela-tivo intermedio resolvió que no era necesaria, debido a las circunstancias particulares del caso de autos, la celebra-ción de una vista en su fondo para recibir prueba y poder dictar sentencia en rebeldía en contra del Estado Libre Asociado o alguna agencia o instrumentalidad de éste, se-gún lo requiere la Regla 45.5 de Procedimiento Civil, 32 L.P.R.A. Ap. III;(9) esto, debido a que, según advirtió del expediente y de los escritos de las partes, los hechos esen-ciales que dieron lugar a la reclamación y al caso de autos, nunca estuvieron en disputa, por lo que la controversia siempre giró en torno a un asunto estrictamente de dere-cho, a saber: determinar a cuál agencia correspondía satis-facer el exceso reclamado y si eran de aplicación o no al caso de autos, las disposiciones de la Ley Núm. 12, ante.",
"Concluyó, además, el foro apelativo intermedio que al pasar el señor Matos Nazario de la ACT a AFASS, esta última agencia tenía que acreditarle los balances de licen-cia por vacaciones y por enfermedad acumulados en su em-pleo anterior, independientemente de que el traslado se hubiera hecho a través de una licencia sin sueldo; que al *13momento de éste pasar de la ACT a AFASS en primera instancia, la ACT no tenía que liquidar nada al deman-dante pues el total de días que tenía acumulado no excedía el total máximo acumulable por reglamentación de la pro-pia Autoridad; que ya cuando el demandante pasó nueva-mente de la AFASS a la ACT, éste sí cualificaba para el pago en efectivo pues a esa fecha ya había acumulado días de licencia por vacaciones y enfermedad en exceso de lo establecido en el reglamento de la propia AFASS; que aun cuando la reglamentación de la AFASS no proveía para el pago del exceso, ésta debía hacerlo para así evitar una si-tuación de enriquecimiento injusto a favor de dicha agen-cia pues fue ésta la que se benefició de los servicios pres-tados por el empleado mientras estuvo vigente la licencia sin sueldo; razón por la cual AFASS tenía el deber de sa-tisfacer al demandante la suma de dinero adeudada en concepto del exceso según dispuso el foro de instancia.",
"Por no estar de acuerdo con la actuación del Tribunal de Circuito de Apelaciones, AFASS acudió en revisión —vía certiorari— ante este Tribunal. La peticionaria alega que procede revocar la sentencia emitida por el Tribunal de Circuito de Apelaciones, confirmatoria de la emitida por el foro de instancia, debido a que dicho foro apelativo incidió: ... al adjudicarle a AFASS el pago del exceso de licencias acu-muladas por concepto de vacaciones y enfermedad del señor Matos Nazario. Petición de certiorari, pág. 6. Expedimos el recurso; específicamente le ordenamos a las partes ilustrar al Tribunal sobre si la celebración de una vista evidenciaría en el presente caso era mandatoria, por ser una parte el Estado Libre Asociado de Puerto Rico, a pesar del hecho de que la controversia planteada era una estrictamente de derecho, y no de hechos.",
"(10) Ambas partes —incluso la propia parte que levantó como error ante el tribunal apelativo que el foro de instancia hubiera dictado sentencia en contra del Estado sin la celebración de una *14vista previa— expresaron en sus respectivos alegatos estar de acuerdo en que la celebración de dicha vista no era ne-cesaria ya que no existe controversia de hecho alguna; in-cluso, no existiendo controversia sobre la suma de dinero adeudada al demandante. (11) Contando con la comparecen-cia de ambas partes, y estando en condiciones de resolver, procedemos a así hacerlo. M A. No obstante las aseveraciones de las partes, en torno a la no necesidad de la celebración de la vista en rebeldía en el presente como condición para que se dictare sentencia en contra del Estado Libre Asociado de Puerto Rico, consideramos pertinente expresarnos al respecto. La Regla 45.5 de Procedimiento Civil, ante, establece que: Regla 45.5 Sentencia contra el Estado Libre Asociado de Puerto Rico No se dictará ninguna sentencia en rebeldía contra el Estado Libre Asociado de Puerto Rico, sus municipios, agencias o ins-trumentalidades ni contra un funcionario en su carácter oficial, a menos que el reclamante pruebe, a satisfacción del tribunal, su reclamación o derecho al remedio que solicita.",
"(12) *15Elio no obstante —y dados los hechos particulares del presente caso, en el cual ambas partes están contestes en que no hay hecho alguno en controversia y que únicamente el caso se circunscribe a resolver una cuestión de derecho, razón por la cual resulta totalmente innecesaria la celebra-ción de una vista evidenciaría a nivel de instancia— somos del criterio que devolver el caso al tribunal de instancia, para la celebración de una vista, sería un ejercicio en futi-lidad; razón por la cual nos abstenemos de hacerlo. B. La peticionaria AFASS alega que tanto el tribunal de instancia, como el tribunal intermedio apelativo, erraron al concluir que le correspondía a ésta satisfacer el pago del exceso en concepto de licencias de vacaciones y enfermedad que acumuló el señor Matos Nazario mientras rendía ser-vicios en AFASS, en virtud de una licencia sin sueldo con-ferida a éste por la ACT. No tiene razón.",
"Plantea la peticionaria que la cuestión de derecho pre-sente en el caso de autos es una novel pues debemos deter-minar, como mencionáramos previamente, si la Ley Núm. 12, ante, sobre transferencias de licencias de vacaciones y enfermedad acumuladas por empleados gubernamentales dentro del servicio público, al éstos pasar de una entidad gubernamental a otra a rendir sus servicios, aplica cuando un empleado de una agencia obtiene una licencia sin sueldo para prestar servicios temporeros en otra agencia. Entendemos que las disposiciones del referido estatuto aplican a situaciones como las del caso de autos. Veamos.",
"Comenzamos analizando la naturaleza de las licencias sin sueldo. Las mismas se consideran tradicionalmente como un privilegio que se concede a empleados regulares para que éstos se ausenten de su trabajo para proseguir estudios, adquirir experiencia provechosa para el servicio, y/o prestar servicios en otro lugar de trabajo. Precisamente se distinguen por ser un beneficio marginal concedido a empleados permanentes o regulares por cierto y determinado tiempo, conservando el puesto donde pres-*16tan servicios regularmente hasta su retorno. (13) La seguridad del retorno del empleado al puesto que ocupa es condición sine qua non para la concesión de dicha licencia sin sueldo, por lo que utilizar dicho permiso para brindar ser-vicios temporeros en otros lugares de trabajo no equivale a una renuncia al puesto original ni conlleva la desvincula-ción del empleado del puesto que ocupa.",
"(14) La única limitación que conlleva la concesión de una licencia sin sueldo a un empleado es que dicho empleado no tendrá derecho a acumular licencias de vacaciones ni en-fermedad en su empleo regular de origen durante la vigen-cia de la misma. (15) El Reglamento de Personal de la Autoridad de Carreteras y Transportación Núm. 5523 de 3 de diciembre de 1996 (Reglamento de Personal de la ACT),(16) en virtud del cual se le concedió al demandante la licencia sin sueldo para prestar servicios en AFASS, específicamente dispone en su Art. 15, Sec. 15.4(10), pág. 115, que: a. Además de las licencias sin paga provistas en otras seccio-nes de este Reglamento, se concederán las siguientes: 1) A empleados con puestos regulares, para prestar servicios en otra agencia del Gobierno o entidad privada, de determi-narse que la experiencia que derive el empleado le resolverá una necesidad comprobada de adiestramiento a la Agencia o al servicio público.",
"Además se señala, en lo pertinente a la licencia de va-caciones durante la vigencia de una licencia sin paga con-cedida a un empleado regular, en el mismo Art. 15, Sec. 15.4(10), págs. 117-118: *17e. Disposiciones Generales 3) Si a un empleado regular se le concede una licencia sin sueldo[,] no será menester que éste agote la licencia de vacacio-nes que tenga acumulada antes de comenzar en disfrute de licencia sin sueldo. En cuanto a las licencias por enfermedad y por vacacio-nes dispone: Sección 15.4- Licencias 1. Licencia de Vacaciones c. Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. 2. Licencia por Enfermedad c. Los empleados podrán acumular su licencia por enferme-dad hasta un máximo de noventa (90) días laborables al finali-zar cada año natural. Reglamento de Personal de la ACT, ante, págs. 92-99. Por otra parte, el Reglamento de Personal para los Empleados de Carrera de la Administración de Facilidades y Servicios de Salud de 7 de junio de 1978, enmendado el 16 de mayo de 1990, págs.",
"85-90 (Reglamento de Personal de AFASS), en su Art. 11, Sec. 11.4, dispone, en lo pertinente a la concesión de licencias: 1- Licencia de Vacaciones c) Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. 2- Licencia por Enfermedad b) La licencia por enfermedad se podrá acumular hasta un *18máximo de noventa (90) días laborables al finalizar cada año natural. ... Al momento del demandante Matos Nazario acogerse al disfrute de una licencia sin sueldo en ACT, éste tenía un balance de licencia de vacaciones acumulada de cuarenta y seis y medio (46.5) días y noventa (90) días por concepto de enfermedad. De manera que, a dicho momento, no se había configurado un balance de licencias acumuladas en exceso del límite máximo reglamentario dispuesto por la ACT. Reseñadas las disposiciones reglamentarias, procede-mos a analizar las disposiciones de la Ley Núm. 12, ante, en cuanto a la transferencia del mencionado balance acu-mulado a AFASS, al momento en que el demandante co-menzó a rendir servicios profesionales en dicha agencia.",
"La citada Ley 12 regula la transferencia de licencias de vacaciones regulares y por enfermedad que hayan acumulado los empleados públicos al pasar éstos de un puesto a otro en los servicios exentos, por oposición y sin oposición, del Gobierno de Puerto Rico. En su Art. 1 específicamente se dispone: Se autoriza la transferencia de licencia por vacaciones y por enfermedad, acumulada por un funcionario o empleado del Es-tado Libre Asociado de Puerto Rico al pasar de un puesto a otro en los Servicios Exento, por Oposición, o sin Oposición, del Go-bierno de Puerto Rico.",
"(Enfasis suplido. (17) Este Tribunal, en el caso de Aut. de Puertos v. Mun. de San Juan, ante, se expresó en torno a la procedencia de la transferencia de vacaciones y de enfermedad acumuladas por un empleado, independientemente de que en la tran-sacción de personal concernida estuviesen implicadas agencias comprendidas en el servicio exento, por o sin oposición, enfatizando el hecho de que nunca se concibió dicha pieza legislativa como un mecanismo para que el empleado *19recibiera el pago de vacaciones y licencias acumuladas cuando éste pasaba de un servicio a otro, aun cuando de-terminadas agencias estuvieran excluidas de la Ley de Personal del Servicio Público.",
"En dicho caso específicamente resolvimos que la transfe-rencia del balance de las licencias acumuladas por con-cepto de vacaciones y enfermedad es obligatoria para todas las agencias del Estado Libre Asociado de Puerto Rico. “La ley, en ese sentido, le impone a la agencia que recibe al empleado la obligación de acreditar y de aceptar las licen-cias acumuladas, siempre que el empleado pase de un puesto a otro o de una agencia a otra dentro del servicio público.” (Énfasis suplido.) Aut.",
"de Puertos v. Mun. de San Juan, ante, pág. 507. (18) Expresamos, además, en el referido caso, ante pág. 504, que la Ley Núm. 12, ante, “intenta fomentar la movilidad de los empleados públicos entre las distintas agencias del Gobierno con independencia del servicio en que estos em-pleados se encuentren comprendidos. Su aplicabilidad, por ende, se extiende a las distintas transacciones de personal comprendidas dentro de los distintos servicios que componen el Gobierno de Puerto Rico, salvo cuando media la desvinculación total y definitiva del empleado del servicio público”.",
"(19) (Énfasis suplido.) Enfatizamos en dicho caso el hecho de que en el Informe de la Cámara de Representan-tes sobre el P. del S. Núm. 91, se hizo constar que la falta de intercambio y ausencia de movilidad “no ayuda a fo-mentar el servicio de carrera público, puesto que, por el temor a perder las vacaciones o la licencia por enfermedad que tuvieren acumuladas, los empleados prefieren seguir *20en la misma agencia donde están laborando con perjuicio en innumerables ocasiones al propio desarrollo y mejora-miento del servicio público”(20) Llegamos a la conclusión en dicho caso, de que el legislador, al aprobar la Ley Núm. 12, ante, tuvo como propósito la creación de un instrumento que garantizara la permanencia del empleado dentro del servicio público, y que de igual modo se fomentara su mo-vilidad y capacidad de superación. Expresamos, por último, en el citado caso que el término “pasar” comprendido en dicho estatuto es uno que abarca a todo el personal del servicio público; “[e]ste término pasar de un puesto a otro o de agencia a otra es de carácter am-plio y abarca a todo el sistema de personal del servicio público”. (Énfasis suplido y en el original.)",
"Aut. de Puertos v. Mun. de San Juan, ante, pág. 508. Esto añadido a la determinación que hiciéramos en ese mismo caso en rela-ción a que la aplicabilidad de la Ley 12, ante, “se extiende a las distintas transacciones de personal comprendidas dentro de los distintos servicios que componen el Gobierno de Puerto Rico, salvo cuando media la desvinculación total y definitiva del empleado del servicio público”. íd., pág.",
"504. Resulta, en consecuencia, totalmente lógica y procedente la conclusión de que la concesión de una licencia sin sueldo a un empleado, para que éste pase de una agencia de gobierno a prestar servicios profesionales temporeros en otra agencia, está debidamente comprendida dentro de las transacciones de personal abarcadas por la citada Ley Núm. 12. “ ‘Es principio cardinal de hermenéutica el que a las palabras [y] al lenguaje de una ley, debe dársele la interpretación que valid [a] el propósito que tuvo el legislador *21al aprobar la medida’.” Muñoz Hernández v. Policía de P.R., 134 D.P.R. 486, 497 (1993). Véase Rivera Maldonado v. Autoridad Sobre Hogares, 87 D.P.R. 453, 456 (1963).",
"Enfatizamos y recalcamos, nuevamente, que según lo resuelto en el caso Aut. de Puertos v. Mun. de San Juan, ante, el término “pasar” es uno de carácter amplio y que específicamente determinamos en dicho caso, luego de analizar la intención del legislador al aprobar la Ley Núm. 12, que las disposiciones de dicha Ley le aplican a las distintas transacciones de personal dentro del servicio público, excepto cuando media la separación del empleado del mismo.",
"En el caso de autos, es evidente que el Matos Nazario pasó de una agencia a otra cuando inicialmente fue a brindar servicios profesionales de la ACT a AFASS y que luego, por segunda ocasión, pasó nuevamente a la ACT al concluirse el término de vigencia de la referida licencia. El señor Matos nunca se retiró ni renunció del servicio público, continuó rindiendo servicios dentro del mismo ofreciendo su trabajo profesional a dos entes gubernamentales distintos sin interrupción alguna en el rendimiento del mismo. (21) Aplicando, pues, esta normativa al caso de autos, con-cluimos que el foro apelativo intermedio actuó correcta-mente al resolver que, al pasar el señor Matos de la ACT a la AFASS, ésta última tenía que acreditarle los balances de licencia por vacaciones y por enfermedad acumulados en su empleo anterior, independientemente de que el traslado se hubiera hecho a través de una licencia sin sueldo. Situa-ción idéntica ocurre cuando el señor Matos se reintegra a su puesto original en la ACT, en cuyo caso procedía una segunda transferencia de los balances mencionados. Ya en *22ese momento era patentemente claro que procedía dicha transferencia pues el demandante renunció a su puesto en AFASS para reintegrarse a sus funciones en la ACT. (22) C. Aclarado el planteamiento sobre si procedía o no la transferencia de balances acumulados cuando el traslado de un empleado se da a través de una licencia sin sueldo, pasamos a examinar qué ocurre con la cantidad de días y balances máximos transferibles por ley al darse las dos transferencias en cuestión. Ordena la referida Ley Núm.",
"12, ante, en su Art. 2, que: Cuando un funcionario o empleado del Gobierno del Estado Libre Asociado de Puerto Rico pase de una agencia a otra com-prendida dentro de los Servicios Exento, por Oposición, o sin Oposición, la agencia en que él trabaja certificará, y la agencia que adquiera sus servicios aceptará y acreditará, el número de días, por vacaciones y por enfermedad acumulados por dicho funcionario o empleado, según el sistema de licencia en vigor en cada Servicio. 3 L.P.R.A. sec. 697. Por otra parte, el Art. 3 dispone que: El máximo de licencia transferible será de 60 días en el caso de licencia por vacaciones y de 90 días en el caso de licencia por enfermedad. 3 L.P.R.A. see.",
"698. Por mandato específico de Ley, al darse la transferencia de los balances de licencias acumulados por un empleado efectuada en base a una transacción de personal debidamente autorizada, dicha transferencia se da solo hasta un máximo de sesenta días por concepto de vacaciones, y en relación con la licencia por enfermedad, hasta un *23máximo de noventa (90) días. (23) Al pasar de un puesto a otro dentro del servicio público, el empleado o funcionario tiene el derecho y seguridad de que los balances acumula-dos en su puesto de origen, se transfieran intactos a la agencia o instrumentalidad a la cual va a rendir sus servi-cios profesionales.",
"Es por tal razón que este foro se vio en la necesidad de resolver, y resolvió, en Aut. de Puertos v. Mun. de San Juan, ante, pág. 510, que “[p]uesto que la Ley Núm. 12, ante, dispone la cantidad máxima de licencia transferible, nada impide que en aquellos casos en que un empleado pasa a ocupar otra posición en otra agencia o rama de go-bierno comprendida en el servicio público, y que ha acumu-lado más de sesenta (60) días en el caso de licencia por vacaciones y/o de noventa (90) días de licencia por enfer-medad, le pueda pagar la agencia o rama de gobierno en que el empleado cesa de laborar el exceso en efectivo cuando así los disponga la reglamentación correspondiente de dicha agencia o rama de gobierno”. (24) (Énfasis suplido y en el original.)",
"De manera que, una agencia o instrumentalidad de go-bierno puede satisfacer el pago del exceso por días acumu-lados en licencias de vacaciones y enfermedad, a un em-pleado suyo que pasa a ocupar otra plaza dentro del servicio público, si es que así su reglamentación de personal lo dispone. Cumpliendo con la obligación de ley im-puesta por el estatuto antes mencionado, al pasar el señor Matos de la ACT a AlFASS inicialmente, la segunda tenía que acreditarle los balances acumulados por éste en la *24ACT. Es decir, era su deber acreditar el balance de cua-renta y seis y medio (46.5) días de licencia de vacaciones y noventa (90) días por enfermedad. Hay que enfatizar el he-cho de que en el presente caso, al darse el traslado original, en ninguna de las dos licencias se había acumulado en ex-ceso del máximo reglamentario ni en exceso del máximo transferible estatuido en la Ley Núm. 12. En consecuencia, nos vemos en la obligación de resolver que el señor Matos Nazario acumuló el exceso en ambas licencias mientras rendía servicios profesionales en la AFASS.",
"Al éste acumular cuarenta y dos (42) días de vaca-ciones y treinta y seis y medio (36.5) días por enfermedad en AFASS, esto añadido a los balances que se debieron ha-ber acreditado de la ACT, se configuró un exceso de vein-tiocho y medio (28.5) días de vacaciones y de treinta y seis y medio (36.5) días de enfermedad. Al demandante regre-sar o reintegrarse a sus servicios en la ACT, sólo se pudo haber transferido hasta el máximo dispuesto por ley. A dicha fecha había acumulado días de licencia por vacaciones y enfermedad en exceso de lo establecido en el reglamento de AFASS.",
"Le correspondía, por tanto, a AFASS —al mo-mento de la segunda transferencia— satisfacerle en efec-tivo al demandante el exceso acumulado en ambas vacacio-nes, si es que el Reglamento de Personal de AFASS provee para el pago de dichos excesos. En virtud de su ley habilitadora, la AFASS es un “administrador individual” en asuntos de personal. (25) Dicha agencia aprobó su propio Reglamento de Personal el 7 de junio de 1978. El mismo dispone que los empleados podrán acumular licencia de vacaciones hasta un máximo de sesenta (60) días laborables y hasta un máximo de noventa (90) días por enfermedad.",
"No obstante, dicho reglamento no provee —como tampoco prohíbe— para el pago en efec-*25tivo del exceso por días acumulados en licencias de vaca-ciones y enfermedad. Resolvemos que, no obstante las circunstancias particu-lares de la agencia —AFASS— que recibió los servicios del empleado, la cual no tenía reglamentación en cuanto al pago del exceso por concepto de licencias acumuladas, le corresponde a dicha agencia satisfacer el pago en efectivo por el exceso de dichas licencias de vacaciones y enferme-dad acumulado mientras éste rindió servicios bajo su su-pervisión; ello por dos razones: en primer lugar, el regla-mento de AFASS no lo prohíbe; en segundo término, de esta manera evitamos una situación de enriquecimiento injusto de parte de dicha agencia y en perjuicio del empleado, que no podría recibir dicha compensación de otra manera.",
"Esto por razón de que fue precisamente en dicha agencia que el demandante acumuló dicho exceso. El mismo surgió a raíz de la prestación de servicios en virtud de la licencia sin paga que le fue concedida por la ACT. La doctrina de enriquecimiento injusto está predicada en la equidad. Al igual que otras acciones basadas en los principios de equidad, la reclamación por enriquecimiento injusto sólo procederá cuando no exista ley que provea para otra causa de acción.",
"Ortiz Andújar v. E.L.A., 122 D.P.R. 817 (1988). Los siguientes elementos tienen que concurrir para que se dé una debida aplicación de dicha doctrina, a saber; existencia de un enriquecimiento, un correlativo empobrecimiento; conexión entre dicho enriquecimiento y el empobrecimiento; falta de causa de acción que justifique el enriquecimiento; inexistencia de precepto legal que excluya la aplicación del enriquecimiento sin causa. Ortiz Andújar v. E.L.A, ante; Morales v. Municipio de Toa Baja, 119 D.P.R. 682 (1987). Es norma de derecho reconocida que esta doctrina es de aplicación, en determinadas ocasiones, a organismos administrativos. Véase Plan Bienestar Salud v. Alcalde Cabo Rojo, 114 D.P.R. 697 (1983). En Hatton v. Mun. de *26Ponce, 134 D.P.R. 1001, 1010 (1994), expresamos, al definir los contornos de esta doctrina, que la misma “no se aplicará cuando resulte contrari[a] a una clara política pública, plasmada en un estatuto o en la Constitución”.",
"(Enfasis en el original suprimido y énfasis suplido.) Precisamente por ello es que la doctrina de enriquecimiento injusto es de aplicación en el presente caso. Constituye una clara política pública,(26) que debe ser fomentada, la de garantizar la movilidad de los empleados públicos entre las distintas agencias y dependencias del Gobierno de Puerto Rico y de que éstos no sean penalizados por ello en forma alguna, esto es, y en lo pertinente, dichos empleados tienen el derecho a disfrutar del exceso de vacaciones que acumulan y/o que se le satisfaga en efectivo dicho exceso. Cuando no se permite el disfrute de la *27licencia de vacaciones acumuladas y luego tampoco se per-mite el pago de dicha licencia, ello claramente constituye una situación de enriquecimiento injusto por parte del or-ganismo gubernamental concernido. (27) El señor Matos Nazario rindió servicios y laboró du-rante dos años consecutivos para la AFASS; dicha agencia se benefició de su trabajo. Al culminar sus labores en dicha agencia, y reintegrarse a sus labores en la ACT, careció de oportunidad de disfrutar dicho exceso acumulado en licen-cias, por lo que procede indemnizarlo de la única forma posible, el pago en efectivo de dicho exceso.",
"No puede ne-gársele el mismo bajo el fundamento de que el reglamento de la AFASS no provee para dicho pago. Es evidente y nunca se cuestionó el hecho de que el señor Matos Nazario acumuló dicho exceso y que no lo pudo disfrutar en mo-mento alguno. El hecho de que el señor Matos Nazario no hubiera te-nido oportunidad de disfrutar de sus licencias acumuladas de enfermedad y de vacaciones, no debe perjudicar a éste toda, vez que no debemos penalizarle por la falta de diligen-cia de AFASS. Rodríguez Cruz v. Padilla Ayala, 125 D.P.R. 486 (1990). De concluir que no procede el pago, AFASS es-taría beneficiándose del trabajo realizado por el deman-dante aun cuando fue evidente que el exceso acumulado se configuró mientras éste rindió servicios para dicha agencia. Repetimos, no puede negársele el referido pago bajo el fundamento de que el reglamento de la AFASS no provee para el mismo. La alternativa de dejar desprovisto de ello al empleado no es aceptable.",
"La conclusión a la que hoy llegamos refleja fielmente la intención del legislador referente a las disposiciones sobre transferencias de balances de licencias de vacaciones y en-fermedad acumulados por empleados y funcionarios públi-cos, independientemente de cuál sea la transacción de per*28sonal comprendida; todo ello en aras de fomentar una administración de personal eficiente que inspire a los ser-vidores públicos a fomentar una carrera profesional dentro del gobierno central sin obstáculos que impidan su movili-dad dentro del sistema. Por otro lado, no podemos dejar desprovisto de indemni-zación, por concepto de licencias de vacaciones y enferme-dad acumuladas y no disfrutadas, a un servidor público que aportó todo su conocimiento y experiencia a dos depen-dencias gubernamentales que evidentemente se beneficia-ron de tales servicios. (28) Se dictará sentencia de conformidad. El Juez Presidente Señor Andréu García y el Juez Asociado Señor Fuster Berlingeri concurrieron con el resultado sin opinión escrita. El Juez Asociado Señor Corrada Del Río se inhibió.",
"(1) La licencia originalmente concedida por el periodo de un año, le fue exten-dida por un año adicional, a solicitud del propio demandante, debido a que el Director Ejecutivo de la Administración de Facilidades y Servicios de Salud (AFASS) interesaba retener sus servicios. Véase Apéndice, pág. 50. El Reglamento de Personal de la Autoridad de Carreteras y Transportación Núm. 5523 de 3 de diciembre de 1996 (Reglamento de Personal de la ACT), dispone en su Art. 15, Sec. 15.4(10), pág. 115: “10. Licencia sin Paga “a. Además de las licencias sin paga provistas en otras secciones de este Regla-mento, se concederán las siguientes: “1) A empleados con puestos regulares, para prestar servicios en otra agencia del gobierno o entidad privada, de determinarse que la experiencia que derive el empleado le resolverá una necesidad comprobada de adiestramiento a la agencia o al servicio público.” (2) Dichos balances supuestamente quedaron en estado de suspenso durante el tiempo de vigencia de la licencia sin sueldo.",
"Comunicación del Ing. Sergio L. González, Director Ejecutivo de la Autoridad de Carreteras y Transportación (Director Ejecutivo de la ACT) a la Leda. Marta Rivera Plaza, Directora Ejecutiva de AFASS. Apéndice, págs. 52-53. (3) Véase Apéndice, pág. 51 (Carta de 5 de diciembre de 1995 de la Jefa Interina de Área de Personal de AFASS dirigida al Ing. Sergio González, Director Ejecutivo de la ACT). (4) El Reglamento de Personal de la ACT, ante, págs. 92-99, dispone, en su See. 15.4 sobre Licencias: “1. Licencia de Vacaciones “c.",
"Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. “2. Licencia por Enfermedad “e. Los empleados podrán acumular su licencia por enfermedad hasta un máximo de noventa (90) días laborables al finalizar cada año natural.” El Reglamento de Personal para los Empleados de Carrera de la Administración de Facilidades y Servicios de Salud de 7 de junio de 1978, enmendado el 16 de mayo de 1990 (Reglamento de Personal de AFASS), págs. 85-90, dispone, en su Art. 11, Sec. 11.4 sobre Licencias: “1. Licencia de Vacaciones *8“c) Los empleados podrán acumular la misma hasta un máximo de sesenta (60) días laborables al finalizar cada año natural. “2. Licencia por Enfermedad “b) La licencia por enfermedad se podrá acumular hasta un máximo de no-venta (90) días laborables al finalizar cualquier año natural.",
"...” La suma de los días acumulados en ambas dependencias por concepto de licen-cias conlleva un total de ochenta y ocho días y medio (88.5) acumulados por concepto de vacaciones y ciento veintiséis (126) días por enfermedad; configurándose así un exceso de veintiocho días y medio (28.5) por vacaciones y treinta y seis días y medio (36.5) por enfermedad. (5) Véase Resolución notificada el 31 de julio de 1997. Apéndice, pág. 64.",
"(6) Véase Orden del Tribunal de Primera Instancia, Sala de San Juan. Apéndice, pág. 76. (7) Véase Minuta del Tribunal de Primera Instancia, vista transaccional cele-brada el 18 de agosto de 1998. Apéndice, pág. 79. (8) En dicho recurso, imputó al Tribunal de Primera Instancia la comisión de los siguientes errores: “Erró el Honorable Tribunal de Primera Instancia al dictar Sentencia en Rebel-día contra la Administración de Facilidades y Servicios de Salud (AFASS) sin que el demandante haya probado en el juicio en su fondo que tenía derecho al remedio solicitado, como dispone la Regla 45.5 de las de Procedimiento Civil de 1979. “Erró el Honorable Tribunal de Primera Instancia al no acoger la solicitud de la Administración de facilidades y Servicios de Salud (AFASS) presentada en su Moción de Reconsideración, de dejar sin efecto la anotación de rebeldía contra el Estado.",
"“Erró el Honorable Tribunal de Primera Instancia al imponerle a la Adminis-tración de Facilidades y Servicios de Salud (AFASS) el pago del exceso Acumulado de bcencia por vacaciones y de enfermedad durante el ofrecimiento de los servicios profesionales del demandante en AFASS.” Apéndice, pág. 21. (9) La Regla 45.5 dispone: “No se dictará ninguna sentencia en rebeldía contra el Estado Libre Asociado de Puerto Rico, sus municipios, agencias o instrumentalidades ni contra un funcionario en su carácter oficial, a menos que el reclamante pruebe, a satisfacción del tribunal, su reclamación o derecho al remedio que solicita.” (10) Resolución del Tribunal Supremo de Puerto Rico de 31 de julio de 2000. (11) Nos señala la peticionaria AFASS en su alegato ante este Tribunal: “Enten-demos que una vista en el caso de autos no era necesaria.",
"[E]n el caso de autos lo que existe es una controversia de derecho a los efectos de establecer a qué agencia le corresponde el pago del exceso de licencias acumuladas cuando el mismo surge de una licencia sin sueldo que una agencia le otorga a un empleado para que preste servicios temporeros en otra. Una vista evidenciaría no hubiese variado la anterior controversia de derecho.” Alegato, págs. 6-7. Por su parte, nos señala la recurrida ACT en su respectivo alegato, “en el caso de autos no existe, ni existió nunca una controversia genuina de hechos. La única controversia existente ... era una de DERECHO. Por lo tanto, la celebración de una vista evidenciaría en nada iba a abonar a la tramitación expedita y justa del caso de epígrafe ... lo que restaba por realizar era dictar sentencia aplicando el derecho a los hechos incontrovertidos”. Alegato de la parte recurrida, Autoridad de Carreteras y Transportación, pág.",
"6. (12) Véanse: R. Hernández Colón, Práctica Jurídica de Puerto Rico: Derecho Procesal Civil, San Juan, Ed. Michie de Puerto Rico, 1997, pág. 218; J.A. Cuevas Segarra, Tratado de Derecho Procesal Civil, San Juan, Pubs. J.T.S., 2000, T. II, pág. 760. (13) Véase Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993. (14) Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993. (15) Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993. (16) El Reglamento de Personal de la ACT, ante, anuló el Reglamento Núm. 4769 de 6 de agosto de 1992, vigente al momento en que se le concedió la licencia sin paga al demandante. Ambos disponen exactamente lo mismo en cuanto a la concesión de licencias sin paga.",
"(17) 3 L.P.R.A. sec. 696. (18) Véanse, además: Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993, pág. 2, “cuando un funcionario o empleado pasa de un puesto a otro en el servicio público, ... la transferencia de las licencias de vacaciones y por enfer-medad acumuladas es obligatoria.”; Consulta del Secretario de Justicia Núm. 882-93-B de 14 de octubre de 1993; Op. Sec. Just. Núm. 29 de 1ro de diciembre de 1992. (19) Véase, además, Informe de la Cámara de Representantes sobre el P. del S. 91 de 31 de marzo de 1953.",
"(20) Aut. de Puertos v. Mun. de San Juan, ante, págs. 504-505. Reseñó este tribunal al concluir su poneneia:“La norma que hoy adoptamos promueve los objeti-vos de fomentar la carrera en el servicio público y la movilidad como pilares funda-mentales para una sana administración pública.... Esta norma beneficia tanto al empleado como al servicio público”. Aut. de Puertos v. Mun. de San Juan, ante, pág. 510. (21) Una vez concluido el periodo de dos años de licencia sin sueldo, el señor Matos Nazario renunció a su puesto de confianza en AFASS efectivo el viernes 13 de octubre de 1995, para así reintegrarse el próximo lunes 16 de octubre, a sus labores en la ACT, sin que mediara interrupción o desvinculación alguna del sistema de servicio público. (22) No debemos olvidar tampoco lo resuelto por este foro en el caso Rodríguez Cruz v. Padilla Ayala, 125 D.P.R. 486, 516 (1990), en cuanto a que “solamente pro-cede la liquidación de las vacaciones acumuladas mediante el pago en efectivo de las mismas cuando la renuncia o separación del servicio produce la desvinculación del empleado del servicio”.",
"(Énfasis suprimido.) En dicho caso determinamos que el tribunal de instancia había incidido al ordenar al pago de cierta cantidad de días por concepto de vacaciones no disfrutadas. Tal decisión corrobora más atan lo resuelto hoy por este tribunal al disponer que procede la transferencia de los balances de licencias acumulados por el demandante, cuando inicialmente acudió a rendir servi-cios en AFASS y cuando nuevamente se reintegró a su puesto en la ACT. (23) Véanse, además: Aut. de Puertos v. Mun. de San Juan, ante; Op. Sec. Just. Núm.",
"29 de 1ro de diciembre de 1992; Consulta del Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993; Consulta del Secretario de Justicia Núm. 882-93-B de 14 de octubre de 1993. (24) Es norma de derecho administrativo que la reglamentación de personal de una corporación pública constituye la fuente de todos los derechos de sus funciona-rios y empleados en cuanto a todo lo relativo a la acumulación, concesión, disfrute y pago global de las licencias de vacaciones y por enfermedad. Consulta Secretario de Justicia Núm. 681-92-A de 13 de enero de 1993, pág. 3.",
"(25) Ley Núm. 26 de 13 de noviembre de 1975 (24 L.P.R.A. ant. sec. 337d). (26) El 20 de agosto de 1996, se aprobó la Ley Núm. 156, a los efectos de conceder a las agencias gubernamentales la facultad de pagar anualmente a los empleados las licencias de vacaciones y de enfermedad acumuladas y no disfrutadas en exceso de lo establecido por reglamentación. Mediante tal estatuto, se propuso un cambio en las facultades de las agencias, para que éstas tuvieran la opción de conceder a sus empleados el derecho al pago anual de licencias acumuladas y no disfrutadas por concepto de vacaciones y enfermerdad en exceso a lo reglamentado.",
"Exposición de Motivos de la Ley Núm. 156 de 20 de agosto de 1996, Leyes de Puerto Rico 680-681. Hasta tal momento, debido a la limitación del pago de una suma global por concepto de licencias acumuladas sólo a la separación del servicio, la mayoría de las agencias sólo concedían a sus empleados el beneficio de disfrutar del exceso de licen-cia acumulada sobre el límite de 60 días, cuando no hubieran podido disfrutar de dicha licencia por necesidades del servicio. El no aprobar esto último implicaba la pérdida del exceso de licencia acumulada y no disfrutada. Esta medida tuvo pues el propósito de evitar dicha situación y premiar al empleado público que utiliza sus licencias de manera razonable, dándole pues el beneficio de concederle el mecanismo del pago en efectivo del exceso acumulado en licencias y no disfrutado. La aprobación de dicho estatuto nos ilustra sobre la intención del legislador de no permitir que empleados públicos que hubieran acumulado exceso de licencias, se vieran impedidos de obtener una cantidad de dinero por concepto de dicho exceso, máxime cuando la reglamentación de las respectivas agencias no disponían sobre el modo de satisfacer dicho pago. De manera que no resulta difícil llegar a la razonable conclusión sobre disponer tal pago, aun cuando este estatuto no hubiera estado vi-gente al momento en que el demandante pasó de la AFASS a reintegrarse a sus labores en la ACT. Hay que tener en mente que “toda acción legislativa persigue un propósito.",
"Trata de corregir un mal, alterar una situación existente, complementar una regla-mentación vigente, fomentar algún bien específico o el bienestar general, reconocer o proteger un derecho ...”. R.E. Bernier y J.A. Cuevas Segarra, Aprobación e interpretación de las leyes en Puerto Rico, San Juan, Pubs. J.T.S., 1987, Vol. 1, págs. 245-246. (27) Véase Op. Sec. Just. Núm. 29 de 1ro de diciembre de 1992, interpretando a Rodríguez Cruz v. Padilla Ayala, ante. (28) El Reglamento de Personal de AFASS, en su Art. 11, Sec. 11.4(1)(g), sola-mente dispone para que el empleado que ha acumulado en exceso de licencia sobre el límite de sesenta (60) días, disfrute de dicho exceso en la fecha más próxima posible, dentro del término de los primeros seis (6) meses del siguiente año natural.",
"Esta disposición reglamentaria no tiene ningún efecto en cuanto a la situación del señor Matos Nazario, pues al éste pasar ininterrumpidamente de la AEASS a la ACT, al concluir la licencia sin sueldo, perdió toda oportunidad para disfrutar dicho exceso. Brindarle esa oportunidad en estos momentos no tendría ninguna razón de ser. Además, no podemos ordenarle a la ACT que conceda en estos momentos el disfrute del exceso, pues fue precisamente en la AEASS donde el empleado lo acu-muló y fue en esa agencia donde no pudo disfrutarlo. No podemos tampoco exigir a la ACT que conceda dicho exceso, pues estaríamos penalizándola por la falta de dili-gencia de AFASS al no procurar que el demandante disfrutara de sus vacaciones en la forma más compatible con el plan de vacaciones y enfermedad en vigor en dicha agencia."
] | https://www.courtlistener.com/api/rest/v3/opinions/8565572/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
WINTER, Circuit Judge: These consolidated petitions involve various challenges to the 1983 distribution of cable television royalty fees by the Copyright Royalty Tribunal (“CRT” or “Tribunal”), an agency established pursuant to Sections 801-810 of the 1976 Copyrights Act (“Act” or “1976 Act”), 17 U.S.C. §§ 801-810 (1982). After four of the five previous annual distributions, dissatisfied cable royalty claimants appealed the Tribunal’s determinations to the District of Columbia Circuit. See National Association of Broadcasters v. Copyright Royalty Tribunal (NAB v. CRT I), 675 F.2d 367 (D.C.Cir.1982) (reviewing Tribunal’s first cable royalty distribution, of royalties paid for calendar year 1978); Christian Broadcasting Network, Inc. v. Copyright Royalty Tribunal (CBN v. CRT), 720 F.2d 1295 (D.C.Cir.1983) (reviewing cable royalty distribution for calendar year 1979); National Association of Broadcasters v. Cable Royalty Tribunal (NAB v. CRT II), 772 F.2d 922 (D.C.Cir.1985) (reviewing cable royalty distributions for calendar years 1980 and 1982), cert. denied, — U.S.-, 106 S.Ct. 1245, 89 L.Ed.2d 353 (1986). Each distribution was affirmed in substantial part by a court increasingly critical of “the claimants’ studied tack to date of ‘boundless litigiousness,’ ” NAB v. CRT II, 772 F.2d at 940 (quoting CBN v. CRT, 720 F.2d at 1319), and increasingly unwilling to engage in a detailed analysis of “the various nooks and crannies of the Tribunal’s decisions.” 772 F.2d at 940. Thus encouraged either to forgo the usual automatic challenge to the Tribunal’s determinations, no doubt an unthinkable alternative in the “highly litigious copyright-owner subculture,” id., or to seek a different Court of Appeals, claimants to the 1983 Cable Royalty Fund petitioned us for review of the cable royalty distribution. With the exception of two issues, however, only the circuit is new, and the petitions raise the usual array of noisily contested minutiae concerning the precise allocations of cable royalty fees. An elaborate response to these latter claims is not justified, and our discussion of *175the merits will be devoted largely to the two new issues. We deny the petitions. I. GENERAL BACKGROUND Because this case is but the latest in a series of appeals from cable royalty distribution proceedings, see supra, familiarity with which is assumed, we need discuss only briefly the Act’s compulsory licensing scheme. Under 17 U.S.C. § 111, cable television operators may obtain a license permitting retransmission of certain copyrighted programming, known as distant broadcast signals.1 A cable system is protected from copyright liability when it carries only those signals and programs designated under the rules of the Federal Communications Commission (“FCC”), and deposits semi-annual royalty payments into a central fund (“Fund”). Id. § 111(c)(2)(A), (B). The 1976 Act set initial royalty fee schedules and authorized the Tribunal to make adjustments in light of inflation, changes in cable subscription rates, and alterations by the FCC of certain of its rules. See id. § 801(b)(2). The Fund is then distributed annually by the Tribunal to the copyright owners whose works have been the subject of distant signal retransmissions. The 1976 Act did not provide precise standards for distributing the Fund to various claimants,2 but left that task largely to the Tribunal’s discretion. However, the Tribunal’s determination rarely represents the last step in an annual cable royalty distribution; as noted above, all but one of the Tribunal’s final orders have been appealed to the courts, generally without success. In upholding in large part the Tribunal’s cable royalty determinations, each of the previous appellate decisions has emphasized the very limited power of reviewing courts. See NAB v. CRT II, 772 F.2d at 926; CBN v. CRT, 720 F.2d at 1304; NAB v. CRT I, 675 F.2d at 374. The narrow scope of review results from the nature of the Tribunal’s ■ task in determining what share of the Fund should go to which claimants. Prior courts understandably have viewed the Tribunal’s royalty distributions as “scarcely a typical agency adjudication,” and as decisions that, by their very nature, are “doomed to be somewhat artificial.” NAB v. CRT II, 772 F.2d at 926. In the most recent cable royalty distribution case, the District of Columbia Circuit stated: In reviewing the Tribunal’s determinations, the judicial task is not to weigh the evidence and fix what in our view would constitute appropriate percentages, for that would be to intrude into the function entrusted to the Tribunal. Our job, rather, is to determine whether the royalty awards are within a “zone of reasonableness” — not unreasonably high or unreasonably low — and that the [Tribunal’s] decision is neither arbitrary nor capricious, and is supported by substantial evidence. Id. (citing NAB v. CRT I, 675 F.2d at 371, 374-75). We share that view of the role of a reviewing court. The 1983 distribution proceeding was preceded by two pertinent developments in cable regulation and licensing. First, in a 1980 order that we upheld in Malrite T.V. of New York v. FCC, 652 F.2d 1140 (2d Cir.1981), cert. denied, 454 U.S. 1143, 102 S.Ct. 1002, 71 L.Ed.2d 295 (1982), the FCC repealed two sets of regulations restricting cable carriage. One set of rules, called the “distant signal rules,” had restricted the number of distant signals a cable system was permitted to carry, depending on the size and signal density of the market with*176in which the cable system operated. The other set, styled the “syndicated program exclusivity rules,” had required cable systems to black out certain syndicated programming from their distant signals. The blackout right was enforceable either by the program syndicators or by local broadcast stations that had acquired exclusive broadcast rights from the syndicators.3 Second, the Tribunal adjusted the copyright royalty rates in light of the FCC’s elimination of the distant signal and syndicated exclusivity rules. This adjustment was specifically authorized, although not mandated, by the 1976 Act. 17 U.S.C. § 801(b)(2)(B), (C). The Tribunal’s adjustments added two new royalty fees to be paid by cable systems. The first, the “3.75% rate,” requires cable systems to pay 3.75% of their gross receipts from basic services for each distant signal equivalent they add as a result of the repeal of the FCC’s distant signal rules. The second is a syndicated exclusivity (“syndex”) surcharge to be paid by cable systems retransmitting signals formerly subject to the FCC’s blackout provisions. See Adjustment of Royalty Rate for Cable Systems; Federal Communication’s Commission’s Deregulation of the Cable Industry, 47 Fed.Reg. 52,146 (1982) (to be codified at 37 C.F.R. pt. 308) (final rule). The Tribunal’s order adjusting the compulsory licensing rates was upheld in National Cable Television Association, Inc. v. Copyright Royalty Tribunal (NCTA v. CRT), 724 F.2d 176 (D.C.Cir.1983). As a consequence, issues regarding the precise allocation of fees generated by the 3.75% and syndex royalty rates arose for the first time in the 1983 proceeding now before us for review. II. THE 1983 PROCEEDING A. The Tribunal’s Determinations As in past years, the Tribunal conducted the 1983 proceeding in two phases: Phase I allocated cable royalties among categories of claimants; Phase II divided these royalties among individual claimants within each category. For purposes of the Phase I distribution, the Tribunal divided the cable royalties into three separate funds: the “basic fund,” the “3.75% fund,” and the “syndex fund.” The basic fund corresponded to the royalties available in previous years; the 3.75% and syndex funds resulted from the adjustments of royalty rates described above. After fifty-three days of evidentiary hearings, the Tribunal made the following Phase I distributions: Basic 3.75% Syndex Program Suppliers 67.10% 72.00% 95.50% Joint Sports Claimants 16.35% 17.50% 0 Public Broadcasting Service 5.20% 0 0 Commercial Television Broadcasters 5.00% 5.00% 0 Music Claimants 4.50% 4.50% 4.50% Devotional Claimants 1.10% 0.75% 0 Canadian Claimants 0.75% 0.25% 0 Commercial Radio 0 0 0 1983 Cable Royalty Distribution Proceeding, 51 Fed.Reg. 12,792, 12,818 (1986) (final determination). The only controversy in Phase II of the 1983 proceeding arose among members of the Program Suppliers group. In this phase, the Tribunal determined that it would allocate fees from one fund rather *177than from three separate funds. The Tribunal also concluded that none of the claimants had made a presentation justifying a change in the Phase II awards made in the 1982 proceeding. Accordingly, the Tribunal made the following Phase II allocation: Motion Picture Association of America (“MPAA") 98.2% Multimedia Entertainment, Inc. ("Multimedia”) 1.0% National Association of Broadcasters (“NAB”) 4 0.8% 51 Fed.Reg. at 12,818. B. The Petitions for Review The petitioners are various claimant groups who participated in the 1983 proceeding. NAB, a trade association of United States television and radio stations, challenges the Tribunal’s decision awarding the bulk of the syndex royalties to Program Suppliers. NAB argues that because television stations (i.e., the broadcasters), not program suppliers (i.e., the syndicators), owned the relevant copyright rights represented by the syndex fund at the times pertinent to the 1983 distribution, the stations should have received the 95.5% syndex allocation.4 5 The Canadian Claimants, representing Canadian television broadcasters and producers, attack the Tribunal’s distribution of all three funds. Hoping to increase their awards from both the basic and 3.75% funds, they argue that the Tribunal’s allocation from these two funds was arbitrary and capricious. Old-Time Gospel Hour and PTL Television Network (“Devotional Claimants”), owners of syndicated programming with religious themes, also seek reversal of the Tribunal’s distribution of all three funds.6 Like Canadian Claimants, they hope to increase their respective shares from the basic and 3.75% funds by establishing that the Tribunal’s determinations were arbitrary and capricious. Devotional Claimants also argue that they should have shared in the distribution of syndex funds. Finally, Devotional Claimants maintain that the Copyrights Act mandates distribution from a single royalty fund, rather than from three separate ones. MPAA represents eighty-three producers and/or syndicators in the Program Supplier category. MPAA challenges the Tribunal’s allocation of the basic and 3.75% funds as arbitrary and capricious, but, unlike the other petitioners, argues that the awards to Devotional Claimants and Canadian Claimants were too high, rather than too low. MPAA also asserts that the Tribunal’s Phase II determinations were not supported by the evidence. Finally, MPAA has filed an intervenor’s brief, defending the Tribunal’s award of 95.5% of the syndex royalties to Program Suppliers from attack by NAB. Several other parties have also intervened. The Joint Sports Claimants, a group that consists of the National Collegiate Athletic Association and various professional baseball, basketball, hockey, and soccer leagues, intervened to oppose any increase in Canadian or Devotional Claimants’ basic and 3.75% awards. The American Society of Composers, Authors and Publishers (“ASCAP”); Broadcast Music, Inc. (“BMI”); and SESAC, Inc., three performing rights societies known collectively as Music Claimants, intervened to defend all aspects of the Tribunal’s Phase I determination. Multimedia, a non-MPAA pro*178ducer and syndicator of television series and specials, intervened to defend the Tribunal’s Phase II distribution. Public Broadcasting Service (“PBS”), representing all copyright claimants for programming broadcast on public television stations, intervened to defend its basic fund award. Finally, petitioner NAB intervened to defend its Phase II award from attack by MPAA. III. DISCUSSION The issues raised vary widely in complexity and merit. Certain novel issues have arisen because the 1983 proceeding was the first to allocate royalties generated by the new 3.75% and syndex rates. We discuss these issues infra. Petitioners also raise the usual host of detailed, nitpicking challenges to the exact amounts of the Tribunal’s distributions. With regard to these latter claims, only the arguments of the Canadian Claimants warrant discussion. A. Allocation of Royalties From Three Separate Funds As described above, the Tribunal divided the royalties into three separate funds in making its Phase I allocation. Devotional Claimants argue that the absence of express authorization for separate funds in the Copyrights Act renders this decision erroneous as a matter of law. We disagree. Congress declined to legislate specific standards to govern the distribution of royalties in order to leave the Tribunal with maximum flexibility. Congress reasoned that “it would not be appropriate to specify particular, limiting standards for distribution” of cable royalties, and deliberately left the distribution criteria to be developed by the Tribunal on the basis of “all pertinent data and considerations presented by the claimants.” H.R.Rep. No. 1476, 94th Cong., 2d Sess. 97, reprinted in 1976 U.S. Code Cong. & Admin.News 5659, 5712; see also CBN v. CRT, 720 F.2d at 1303 (“In evaluating the parties’ competing claims to the Fund, the Tribunal operates with very little substantive guidance from Congress.”). The absence of express legislative authorization of separate funds is thus of no consequence. Moreover, the establishment of the 3.75% and syndex royalty rates made new distribution criteria imperative. Certain claimants are, in fact, ineligible to receive royalties at the new rates,7 and distribution of royalties from a single fund would require complex adjustments of awards. The Tribunal thus reasonably concluded that its task of distributing royalties would be facilitated by making separate allocations of the royalties collected at the three separate rates. Devotional Claimants also argue that the Tribunal’s Phase II determination, which allocated royalties among the various Program Supplier Claimants on a single-fund basis, “demonstrates the fallacy of the [Tribunal’s] ‘3-Fund’ approach” in Phase I. Again we disagree. The use of a single-fund approach in Phase II demonstrates that the Tribunal tailored its distribution standards in each phase to the facts presented. As noted above, the claimant categories in Phase I had varying degrees of royalty eligibility. In Phase II, on the other hand, all three claimants were from the Program Supplier category, and all three were eligible to receive some of the royalties at the new rates. The Tribunal determined, moreover, that it did not have sufficient evidence to conclude that the relative carriage of these claimants’ programming at the new rates was significantly different than at the basic rate.8 51 Fed. Reg. at 12,818. It was thus reasonable to *179conclude that a single-fund approach in Phase II was appropriate. B. Distribution of the Syndex Fund The Tribunal’s distribution of the syndex fund — royalties resulting from cable retransmission of broadcast signals formerly subject to the FCC syndicated exclusivity rules — presents a more difficult issue, largely because of the Tribunal’s failure to adhere to a consistent rationale for establishing the syndex fund. Under Section 111(d)(4) of the Act, 17 U.S.C. § 111(d)(4), the royalties resulting from cable retransmission of distant signals, including syndex royalties, must be distributed to the “copyright owners” of the retransmitted works. NAB bases its claim on the fact that before the syndicated exclusivity rules were eliminated, broadcasters had entered into long-term contracts with syndicators; these contracts allowed the broadcasters to transmit particular programs and to enforce in their local geographic areas the exclusivity rules as to those programs. The broadcasters thus claim to be the copyright owners under Section 111(d)(4) because such contracts were in effect at times pertinent to the 1983 distribution. In their view, the contracts with the syndicators constituted a purchase of the exclusivity rights that compensated the syndicators for the value of those rights for the full term of the contract. Because the existing contract prices were not altered when the syndicated exclusivity rules were eliminated, NAB argues, the syndicators continued to be compensated for the value of the now nonexistent rights while the broadcasters bore the full costs of losing those rights. We begin our analysis by noting that there is nothing in the Copyrights Act that precludes the broadcasters from being “copyright owners” in their status as holders of syndicated exclusivity rights. Under the Copyrights Act, the right to perform a motion picture or other audiovisual work may, like any exclusive right,9 be transferred in whole or in part and owned separately. 17 U.S.C. § 201(d)(2). Moreover, any such transfer is a “transfer of copyright ownership” with respect to that right. Id. § 101. We believe, therefore, that the broadcasters’ purchase of exclusive broadcast rights from the syndicators under the syndicated exclusivity rules might constitute a “transfer of copyright ownership” under Sections 101 and 201(d)(2). NAB reasons that, because all syndex royalties paid in 1983 were attributable to cable retransmissions of programs formerly subject to the exclusivity rules, the broadcasters are thus the “copyright owners” of all programs covered by the syndex fund.10 This conclusion is hardly inexorable, however, because broadcasters have a peculiar status with regard to the copyright interests at issue. The logical difficulty with NAB’s claim is that broadcasters *180are both “owners” and “infringers” so far as the exclusivity rules are concerned. The station that is subject to competition from cable transmission of syndicated programs into its local area also may have its own signal and syndicated programs transmitted by cable into distant areas. Viewed in their dual role, the broadcasters would seem to be an anomalous beneficiary of the syndex fund. Rather, that fund would appear to be a method of compensating the relevant copyright owner, namely the syndicator, for the fact that its programs are now being viewed by a much larger audience to the benefit of cable operators. Indeed, in rejecting NAB’s claim, the Tribunal explicitly stated that the syndex fund was created because of the increased number of performances of copyrighted programs as a result of cable transmission. 51 Fed.Reg. at 12,814. In fact, until NAB asserted its claim, all relevant parties appear simply to have assumed that the syndicators would be the prime beneficiaries of the syndex fund. The history of the FCC’s rulemaking includes a statement by the Association of Independent Television Stations, Inc., acknowledging that new royalties resulting from the elimination of syndicated exclusivity rules would be distributed under Section 111(d) to “the copyright owner of the programming aired, not the station.” Comments before the FCC, Joint Appendix (“J.A.”) 803. After the FCC eliminated the exclusivity rules, NAB played no role in the Tribunal’s proceedings that established the syndex rate, but limited its participation to the 3.75% rate proceedings. Were the matter to be decided on the record in this proceeding alone, we would deny the petition on the ground that elimination of syndicated exclusivity rights increased the demand for and exposure of syndicated programs, thus justifying increased royalties paid by the cable operators to the syndicators in the form of the syndex fund. However, we do not write on a clean slate. The syndex fund was established by the Tribunal and upheld by the Court of Appeals for the District of Columbia Circuit on an entirely different ground, namely that elimination of the syndicated exclusivity rules would injure broadcasters economically and thereby cause them to bid less for syndicated programming. NCTA v. CRT, 724 F.2d 176 (D.C.Cir.1983). That court stated: [The Tribunal] credited evidence that distant signal importation by cable diverted audiences from local broadcast stations that had purchased exclusive community rights to syndicated programming; diminished audiences meant lower advertising revenues which translated into reduced bids for programming____ The Tribunal rejected [the cable operators’] assertion, made in opposition to a fee increase, that distant signal audiences generate additional advertising revenue for broadcast stations whose signals are retransmitted by cable____ Based primarily on its conclusion that copyright owners were economically harmed by the programming duplication occasioned by cable importation of distant signals, the Tribunal ordered an upward adjustment in the royalty schedule for “old” distant signals to reflect repeal of syndicated exclusivity protection____ Our review of the record satisfies us that substantial evidence supports the Tribunal’s findings that cable importation of distant broadcast signals harms local purchasers of syndicated programming, and that television broadcasters are not compensated by advertisers for the additional distant audiences generated by cable retransmissions. 724 F.2d at 188-89. The syndex fund was not established on the theory that cable operators should pay additional royalties for the increased audiences that received syndicated programs after the abolition of the exclusivity rules. Rather, it was based on the theory that local broadcasters would not attract additional advertising in their role as “infringers” sending their signals to distant audiences but would suffer advertising losses from duplication in programming *181resulting from distant signals transmitted to their local areas by cable.11 This competitive injury to local broadcasters, it was stated, would reduce their bidding for syndicated programming and thereby reduce the revenues received by syndicators.12 The syndex fund was thus intended to compensate for the losses caused by the elimination of exclusivity protection, not for the increased exploitation of copyrighted works by cable operators. The Tribunal’s original rationale for the syndex fund gives life to NAB’s claim. Because the fund is to compensate for the losses that will not be passed on to the syndicators until existing contracts with the broadcasters expire and new bidding begins, those losses are presumably borne for an initial period of time by the local broadcasters. However, the Tribunal had a second and firmer ground for rejecting NAB’s claim. It stated: We ... note that the broadcast industry was on notice from 1976 that the syndicated exclusivity rules were subject to change. The stations were also on notice by the consistent representation of the industries in the legislative history and the rulings of the Tribunal that royalties for permitted performances would be awarded to the creators of the works. We can only assume that this awareness was reflected in contract negotiations and accommodations, to the extent necessary, were made accordingly. 51 Fed.Reg. at 12,814. Although this argument hardly accounts for the Tribunal’s inconstancy of position on the syndex fund, it is sufficient to justify the denial of NAB’s claim. The record in the FCC rulemaking contains a statement by the broadcasters that they would have no claim to royalties resulting from elimination of the syndicated exclusivity rules. Comments of the Association of Independent Television Stations, Inc. before the FCC, In the Matter of Cable Television Syndicated Program Exclusivity Rules, Docket No. 20988 (March 1, 1977). Consistent with that view, the NAB essentially played no role in the Tribunal proceedings relating to establishment of the syndex fund, leaving the field entirely to the contest between the syndicators and cable operators. When the broadcasters entered into the contracts upon which they rely so heavily, therefore, they knew that the exclusivity rules might be eliminated before the contracts expired. They also knew at various pertinent times that the syndicators had, through efforts before the FCC and the Tribunal, positioned themselves to claim the entirety of any syndex royalties (but for the Music Claimants) authorized by the Tribunal. We therefore believe the Tribunal was entitled to assume, particularly in light of NAB’s failure to put any of the contracts in the record, that broadcasters were fully aware that an uncompensated loss of exclusivity rights was likely to occur before the contracts expired. This awareness is at odds with the argument that the contract price was intended to cover such rights for the full term. Because NAB’s claim to syndex royalties is founded on the latter view of the contracts in question, it must be rejected. C. Other Claims of Error The remainder of petitioners’ arguments involve various fact-based challenges to the particular royalty percentages set by the Tribunal. Because none of these claims comes close to establishing that the Tribunal’s allocations are unreasonable in light of its unusual statutory responsibilities and the inevitable degree of arbitrariness in royalty determinations, we decline to discuss them in detail. *182The Canadian Claimant’s challenge to the basic fund award merits brief explicit consideration. The Tribunal has awarded the Canadian Claimants 0.75% of the basic fund in previous distribution proceedings. As they have attempted unsuccessfully to establish in the past, see NAB v. CRT II, 772 F.2d at 935-36 (seeking an increase based on new evidence in the 1980 proceedings), the Canadian Claimants argue that new evidence that they presented in the 1983 proceedings required an increase in their basic fund award. Specifically, they maintain that the Tribunal should have recognized for the first time the marketplace value of French-language programming. The Canadians particularly challenge the lack of an award for French-language programming, noting the D.C. Circuit’s cautionary words: [W]e will scrutinize carefully, within the limited scope of our review under the APA, the Tribunal’s determination that a claimant’s retransmitted works are of such negligible marketplace value and/or of such negligible benefit to cable operators that no award at all is reasonable. CBN v. CRT, 720 F.2d at 1305. However, this “caveat” referred specifically to “the Tribunal’s failure to award several claimants any shares of the Fund at all.” Id. at 1304. Here, while the Tribunal refused to accord any value to one aspect of the Canadians’ programming — French-language signals — the Tribunal’s overall distribution of 0.75% of the basic fund and 0.25% of the 3.75% fund to Canadian Claimants clearly cannot be characterized as “no award.” Accordingly, we need not heighten our level of scrutiny of the Canadian Claimants’ basic fund award. The new evidence presented by Canadian Claimants in 1983 consisted primarily of a “qualitative” survey of cable operators in twenty-five of the nation’s approximately 1,570 “Form 3” cable systems.13 All twenty-five cable operators carried Canadian programs, and were questioned only about that programming. The Tribunal found this survey flawed, however, in that it encouraged only positive responses about Canadian programming and provided no comparison of the value of that programming relative to other programming. See NAB v. CRT II, 772 F.2d at 935 (“[Tlhe issue is not whether the Canadians objectively improved the quality of their evidentiary submissions, but rather whether any such improvement was sufficient to warrant an award from the 1980 fund greater than the 1979 award, in light of the submissions made by other claimants.”). The Tribunal’s rejection of the Canadians’ new survey was thus within the zone of reasonableness. The Canadian Claimants’ other arguments are similarly unpersuasive. The Tribunal has consistently rejected the use of any fee-generated formula as a mechanical means for allocating royalties, and instead has based its distributions on all of the relevant data presented. See, e.g., 51 Fed.Reg. at 12,808; 47 Fed Reg. 9879, 9894 (1982) (1979 proceeding); 45 Fed.Reg. 63,-026, 63,035 (1980) (1978 proceeding). Thus, evidence of mere carriage does not compel distribution to the Canadians of royalties generated by French-language programming. The remainder of the Canadians’ case hinges on the testimony of one Francophile cable subscriber and a Sports Claimants’ cable operator. Neither of these is sufficient as a matter of law to require a change in the Tribunal’s 1980 conclusion that French-language programming has no significant value to American cable systems. See NAB v. CRT II, 772 F.2d at 936. We conclude that the Tribunal’s 1983 cable royalty allocations were well within the “zone of reasonableness” in all other respects not discussed above. Accordingly, petitioners’ other claims of error are without merit. We answer their challenges en masse by adopting the following admonition of the District of Columbia Circuit: *183We emerge from our analysis of these inherently subjective judgment calls and rough balancing of hotly competing claims with one overriding conclusion: it is the Tribunal which Congress, for better or worse, has entrusted with an unenviable mission of dividing up the booty among copyright holders____ [WJith today’s decision joining the ranks of our two prior exercises of review, the broad discretion necessarily conferred upon the Copyright Royalty Tribunal in making its distributions is emphatically clear. We will not hesitate henceforth, should this tack of litigation-to-the-hilt continue to characterize the aftermath of CRT distribution decisions, to refrain from elaborately responding to the myriad of claims and contentions advanced by a highly litigious copyright-owner subculture. NAB v. CRT II, 772 F.2d at 940. The Tribunal’s decision is upheld in all respects, and the petitions for review are denied.
. Generally speaking, distant signals are originated by television stations outside the local market in which the cable system is located. Cable systems also carry a wide variety of programming not at issue here, such as satellite-delivered movie and sports channels.
. The Act provides that cable royalty claimants "may agree among themselves as to the proportionate division" of the Fund. 17 U.S.C. § 111(d)(5)(A). If, however, after the first day of August of each year, the Tribunal finds that some or all parties are not in agreement, it must conduct a "proceeding” to determine the proper distribution of the controverted portion of the fund. Id. § 111(d)(5)(B).
. In Malrite T. V. we described the operation of the syndicated exclusivity rules: [I]n the top 50 markets, at the request of a local station, cable operators must delete all syndicated programs under exclusive exhibition contract to the requesting station, regardless of when the program is scheduled for showing on the local station, and program copyright owners can request deletion for one year after the first syndicated sale of the program, even if no local station has the rights to exhibit it. In the second 50 markets, distant syndicated programs need not be deleted if broadcast in prime time unless the requesting local station is also planning to air the program in prime time, and exclusivity rights expire at specified time periods or on the occurrence of specified events, depending on the nature of the program, e.g., first-run syndicated series and feature films are protected for two years while reruns of network series are protected for only one year. Only systems in the top 100 markets are subject to these rules. 652 F.2d at 1145 n. 5.
. NAB’s Phase II claim as a member of the Program Supplier category must be distinguished from NAB's Phase I claim, see infra, where NAB competed with the Program Suppliers for royalties from the syndex fund. NAB’s Phase II claim derives from the small number of syndicated programs produced by local broadcast stations; in Phase I, NAB represented the stations in their capacity as broadcasters, rather than as producers.
. NAB does not challenge the Tribunal’s award of 4.50% of the syndex fund to Music Claimants for the use of music in syndicated programs.
. Devotional Claimants withdrew their petition for review but retained the right to raise the same arguments as a party intervenor. In addition, Devotional Claimants filed a separate intervenor’s brief to oppose MPAA’s attempt to reduce their basic and 3.75% fund awards.
. Devotional Claimants concede that parties such as Joint Sports Claimants, PBS, and Canadian Claimants, whose programming was never subject to the syndicated exclusivity rules, are not eligible to receive fees generated by the syndex surcharge. Similarly, because cable carriage of noncommercial educational stations was not limited by the old distant signal rules, PBS is not eligible for royalties at the new 3.75% rate.
. The Tribunal noted that it would prefer a more extensive record in subsequent proceedings regarding the relative worth of Phase II claimants’ programming at the various royalty rates. 51 Fed.Reg. at 12,818.
. Section 106 of the 1976 Act lists the specific exclusive rights that comprise a copyright. These include the rights (1) to reproduce the copyrighted work in copies or phonorecords; (2) to prepare derivative works based upon the copyrighted work; (3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending; (4) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, to perform the copyrighted work publicly; and (5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly. 17 U.S.C. § 106. Cable retransmissions are recognized as public performances under § 106(4). See, e.g., WGN Continental Broadcasting Co. v. United Video, Inc., 693 F.2d 622, 625 (7th Cir. 1982); Eastern Microwave, Inc. v. Doubleday Sports, Inc., 691 F.2d 125, 128 (2d Cir.1982), cert. denied, 459 U.S. 1226, 103 S.Ct. 1232, 75 L.Ed.2d 467 (1983).
. The Tribunal reasoned that because broadcasters may no longer obtain syndicated exclusivity rights, they cannot be copyright owners within the meaning of Section 111(d)(4). However, that argument would also preclude the syndicators from claiming the syndex fund because they also can no longer sell or exercise syndicated exclusivity rights.
. The present record contains evidence that the broadcasters have actually benefited from the elimination of the exclusivity rules. See, e.g., J.A. 257 (independent station ratings in top 20 markets increased after repeal); J.A. 278 (independent station advertising revenues in top 20 markets increased after repeal).
. The record in the present proceeding suggests that such losses to syndicators are improbable.
. Form 3 cable systems are those that grossed more than $214,000 semiannually and paid royalties based on the type of distant signal they carried. 51 Fed.Reg. at 12,797. | 11-27-2022 | [
"WINTER, Circuit Judge: These consolidated petitions involve various challenges to the 1983 distribution of cable television royalty fees by the Copyright Royalty Tribunal (“CRT” or “Tribunal”), an agency established pursuant to Sections 801-810 of the 1976 Copyrights Act (“Act” or “1976 Act”), 17 U.S.C. §§ 801-810 (1982). After four of the five previous annual distributions, dissatisfied cable royalty claimants appealed the Tribunal’s determinations to the District of Columbia Circuit. See National Association of Broadcasters v. Copyright Royalty Tribunal (NAB v. CRT I), 675 F.2d 367 (D.C.Cir.1982) (reviewing Tribunal’s first cable royalty distribution, of royalties paid for calendar year 1978); Christian Broadcasting Network, Inc. v. Copyright Royalty Tribunal (CBN v. CRT), 720 F.2d 1295 (D.C.Cir.1983) (reviewing cable royalty distribution for calendar year 1979); National Association of Broadcasters v. Cable Royalty Tribunal (NAB v. CRT II), 772 F.2d 922 (D.C.Cir.1985) (reviewing cable royalty distributions for calendar years 1980 and 1982), cert. denied, — U.S.-, 106 S.Ct.",
"1245, 89 L.Ed.2d 353 (1986). Each distribution was affirmed in substantial part by a court increasingly critical of “the claimants’ studied tack to date of ‘boundless litigiousness,’ ” NAB v. CRT II, 772 F.2d at 940 (quoting CBN v. CRT, 720 F.2d at 1319), and increasingly unwilling to engage in a detailed analysis of “the various nooks and crannies of the Tribunal’s decisions.” 772 F.2d at 940. Thus encouraged either to forgo the usual automatic challenge to the Tribunal’s determinations, no doubt an unthinkable alternative in the “highly litigious copyright-owner subculture,” id., or to seek a different Court of Appeals, claimants to the 1983 Cable Royalty Fund petitioned us for review of the cable royalty distribution.",
"With the exception of two issues, however, only the circuit is new, and the petitions raise the usual array of noisily contested minutiae concerning the precise allocations of cable royalty fees. An elaborate response to these latter claims is not justified, and our discussion of *175the merits will be devoted largely to the two new issues. We deny the petitions. I. GENERAL BACKGROUND Because this case is but the latest in a series of appeals from cable royalty distribution proceedings, see supra, familiarity with which is assumed, we need discuss only briefly the Act’s compulsory licensing scheme. Under 17 U.S.C. § 111, cable television operators may obtain a license permitting retransmission of certain copyrighted programming, known as distant broadcast signals.1 A cable system is protected from copyright liability when it carries only those signals and programs designated under the rules of the Federal Communications Commission (“FCC”), and deposits semi-annual royalty payments into a central fund (“Fund”). Id. § 111(c)(2)(A), (B).",
"The 1976 Act set initial royalty fee schedules and authorized the Tribunal to make adjustments in light of inflation, changes in cable subscription rates, and alterations by the FCC of certain of its rules. See id. § 801(b)(2). The Fund is then distributed annually by the Tribunal to the copyright owners whose works have been the subject of distant signal retransmissions. The 1976 Act did not provide precise standards for distributing the Fund to various claimants,2 but left that task largely to the Tribunal’s discretion. However, the Tribunal’s determination rarely represents the last step in an annual cable royalty distribution; as noted above, all but one of the Tribunal’s final orders have been appealed to the courts, generally without success. In upholding in large part the Tribunal’s cable royalty determinations, each of the previous appellate decisions has emphasized the very limited power of reviewing courts. See NAB v. CRT II, 772 F.2d at 926; CBN v. CRT, 720 F.2d at 1304; NAB v. CRT I, 675 F.2d at 374. The narrow scope of review results from the nature of the Tribunal’s ■ task in determining what share of the Fund should go to which claimants. Prior courts understandably have viewed the Tribunal’s royalty distributions as “scarcely a typical agency adjudication,” and as decisions that, by their very nature, are “doomed to be somewhat artificial.” NAB v. CRT II, 772 F.2d at 926.",
"In the most recent cable royalty distribution case, the District of Columbia Circuit stated: In reviewing the Tribunal’s determinations, the judicial task is not to weigh the evidence and fix what in our view would constitute appropriate percentages, for that would be to intrude into the function entrusted to the Tribunal. Our job, rather, is to determine whether the royalty awards are within a “zone of reasonableness” — not unreasonably high or unreasonably low — and that the [Tribunal’s] decision is neither arbitrary nor capricious, and is supported by substantial evidence. Id. (citing NAB v. CRT I, 675 F.2d at 371, 374-75). We share that view of the role of a reviewing court. The 1983 distribution proceeding was preceded by two pertinent developments in cable regulation and licensing. First, in a 1980 order that we upheld in Malrite T.V. of New York v. FCC, 652 F.2d 1140 (2d Cir.1981), cert.",
"denied, 454 U.S. 1143, 102 S.Ct. 1002, 71 L.Ed.2d 295 (1982), the FCC repealed two sets of regulations restricting cable carriage. One set of rules, called the “distant signal rules,” had restricted the number of distant signals a cable system was permitted to carry, depending on the size and signal density of the market with*176in which the cable system operated. The other set, styled the “syndicated program exclusivity rules,” had required cable systems to black out certain syndicated programming from their distant signals. The blackout right was enforceable either by the program syndicators or by local broadcast stations that had acquired exclusive broadcast rights from the syndicators.3 Second, the Tribunal adjusted the copyright royalty rates in light of the FCC’s elimination of the distant signal and syndicated exclusivity rules.",
"This adjustment was specifically authorized, although not mandated, by the 1976 Act. 17 U.S.C. § 801(b)(2)(B), (C). The Tribunal’s adjustments added two new royalty fees to be paid by cable systems. The first, the “3.75% rate,” requires cable systems to pay 3.75% of their gross receipts from basic services for each distant signal equivalent they add as a result of the repeal of the FCC’s distant signal rules. The second is a syndicated exclusivity (“syndex”) surcharge to be paid by cable systems retransmitting signals formerly subject to the FCC’s blackout provisions. See Adjustment of Royalty Rate for Cable Systems; Federal Communication’s Commission’s Deregulation of the Cable Industry, 47 Fed.Reg.",
"52,146 (1982) (to be codified at 37 C.F.R. pt. 308) (final rule). The Tribunal’s order adjusting the compulsory licensing rates was upheld in National Cable Television Association, Inc. v. Copyright Royalty Tribunal (NCTA v. CRT), 724 F.2d 176 (D.C.Cir.1983). As a consequence, issues regarding the precise allocation of fees generated by the 3.75% and syndex royalty rates arose for the first time in the 1983 proceeding now before us for review. II. THE 1983 PROCEEDING A. The Tribunal’s Determinations As in past years, the Tribunal conducted the 1983 proceeding in two phases: Phase I allocated cable royalties among categories of claimants; Phase II divided these royalties among individual claimants within each category. For purposes of the Phase I distribution, the Tribunal divided the cable royalties into three separate funds: the “basic fund,” the “3.75% fund,” and the “syndex fund.” The basic fund corresponded to the royalties available in previous years; the 3.75% and syndex funds resulted from the adjustments of royalty rates described above.",
"After fifty-three days of evidentiary hearings, the Tribunal made the following Phase I distributions: Basic 3.75% Syndex Program Suppliers 67.10% 72.00% 95.50% Joint Sports Claimants 16.35% 17.50% 0 Public Broadcasting Service 5.20% 0 0 Commercial Television Broadcasters 5.00% 5.00% 0 Music Claimants 4.50% 4.50% 4.50% Devotional Claimants 1.10% 0.75% 0 Canadian Claimants 0.75% 0.25% 0 Commercial Radio 0 0 0 1983 Cable Royalty Distribution Proceeding, 51 Fed.Reg. 12,792, 12,818 (1986) (final determination). The only controversy in Phase II of the 1983 proceeding arose among members of the Program Suppliers group. In this phase, the Tribunal determined that it would allocate fees from one fund rather *177than from three separate funds. The Tribunal also concluded that none of the claimants had made a presentation justifying a change in the Phase II awards made in the 1982 proceeding. Accordingly, the Tribunal made the following Phase II allocation: Motion Picture Association of America (“MPAA\") 98.2% Multimedia Entertainment, Inc. (\"Multimedia”) 1.0% National Association of Broadcasters (“NAB”) 4 0.8% 51 Fed.Reg. at 12,818.",
"B. The Petitions for Review The petitioners are various claimant groups who participated in the 1983 proceeding. NAB, a trade association of United States television and radio stations, challenges the Tribunal’s decision awarding the bulk of the syndex royalties to Program Suppliers. NAB argues that because television stations (i.e., the broadcasters), not program suppliers (i.e., the syndicators), owned the relevant copyright rights represented by the syndex fund at the times pertinent to the 1983 distribution, the stations should have received the 95.5% syndex allocation.4 5 The Canadian Claimants, representing Canadian television broadcasters and producers, attack the Tribunal’s distribution of all three funds. Hoping to increase their awards from both the basic and 3.75% funds, they argue that the Tribunal’s allocation from these two funds was arbitrary and capricious. Old-Time Gospel Hour and PTL Television Network (“Devotional Claimants”), owners of syndicated programming with religious themes, also seek reversal of the Tribunal’s distribution of all three funds.6 Like Canadian Claimants, they hope to increase their respective shares from the basic and 3.75% funds by establishing that the Tribunal’s determinations were arbitrary and capricious.",
"Devotional Claimants also argue that they should have shared in the distribution of syndex funds. Finally, Devotional Claimants maintain that the Copyrights Act mandates distribution from a single royalty fund, rather than from three separate ones. MPAA represents eighty-three producers and/or syndicators in the Program Supplier category. MPAA challenges the Tribunal’s allocation of the basic and 3.75% funds as arbitrary and capricious, but, unlike the other petitioners, argues that the awards to Devotional Claimants and Canadian Claimants were too high, rather than too low. MPAA also asserts that the Tribunal’s Phase II determinations were not supported by the evidence. Finally, MPAA has filed an intervenor’s brief, defending the Tribunal’s award of 95.5% of the syndex royalties to Program Suppliers from attack by NAB. Several other parties have also intervened. The Joint Sports Claimants, a group that consists of the National Collegiate Athletic Association and various professional baseball, basketball, hockey, and soccer leagues, intervened to oppose any increase in Canadian or Devotional Claimants’ basic and 3.75% awards. The American Society of Composers, Authors and Publishers (“ASCAP”); Broadcast Music, Inc. (“BMI”); and SESAC, Inc., three performing rights societies known collectively as Music Claimants, intervened to defend all aspects of the Tribunal’s Phase I determination.",
"Multimedia, a non-MPAA pro*178ducer and syndicator of television series and specials, intervened to defend the Tribunal’s Phase II distribution. Public Broadcasting Service (“PBS”), representing all copyright claimants for programming broadcast on public television stations, intervened to defend its basic fund award. Finally, petitioner NAB intervened to defend its Phase II award from attack by MPAA. III. DISCUSSION The issues raised vary widely in complexity and merit. Certain novel issues have arisen because the 1983 proceeding was the first to allocate royalties generated by the new 3.75% and syndex rates. We discuss these issues infra. Petitioners also raise the usual host of detailed, nitpicking challenges to the exact amounts of the Tribunal’s distributions.",
"With regard to these latter claims, only the arguments of the Canadian Claimants warrant discussion. A. Allocation of Royalties From Three Separate Funds As described above, the Tribunal divided the royalties into three separate funds in making its Phase I allocation. Devotional Claimants argue that the absence of express authorization for separate funds in the Copyrights Act renders this decision erroneous as a matter of law. We disagree. Congress declined to legislate specific standards to govern the distribution of royalties in order to leave the Tribunal with maximum flexibility. Congress reasoned that “it would not be appropriate to specify particular, limiting standards for distribution” of cable royalties, and deliberately left the distribution criteria to be developed by the Tribunal on the basis of “all pertinent data and considerations presented by the claimants.” H.R.Rep. No. 1476, 94th Cong., 2d Sess. 97, reprinted in 1976 U.S. Code Cong.",
"& Admin.News 5659, 5712; see also CBN v. CRT, 720 F.2d at 1303 (“In evaluating the parties’ competing claims to the Fund, the Tribunal operates with very little substantive guidance from Congress.”). The absence of express legislative authorization of separate funds is thus of no consequence. Moreover, the establishment of the 3.75% and syndex royalty rates made new distribution criteria imperative. Certain claimants are, in fact, ineligible to receive royalties at the new rates,7 and distribution of royalties from a single fund would require complex adjustments of awards. The Tribunal thus reasonably concluded that its task of distributing royalties would be facilitated by making separate allocations of the royalties collected at the three separate rates. Devotional Claimants also argue that the Tribunal’s Phase II determination, which allocated royalties among the various Program Supplier Claimants on a single-fund basis, “demonstrates the fallacy of the [Tribunal’s] ‘3-Fund’ approach” in Phase I. Again we disagree. The use of a single-fund approach in Phase II demonstrates that the Tribunal tailored its distribution standards in each phase to the facts presented. As noted above, the claimant categories in Phase I had varying degrees of royalty eligibility. In Phase II, on the other hand, all three claimants were from the Program Supplier category, and all three were eligible to receive some of the royalties at the new rates. The Tribunal determined, moreover, that it did not have sufficient evidence to conclude that the relative carriage of these claimants’ programming at the new rates was significantly different than at the basic rate.8 51 Fed.",
"Reg. at 12,818. It was thus reasonable to *179conclude that a single-fund approach in Phase II was appropriate. B. Distribution of the Syndex Fund The Tribunal’s distribution of the syndex fund — royalties resulting from cable retransmission of broadcast signals formerly subject to the FCC syndicated exclusivity rules — presents a more difficult issue, largely because of the Tribunal’s failure to adhere to a consistent rationale for establishing the syndex fund. Under Section 111(d)(4) of the Act, 17 U.S.C. § 111(d)(4), the royalties resulting from cable retransmission of distant signals, including syndex royalties, must be distributed to the “copyright owners” of the retransmitted works.",
"NAB bases its claim on the fact that before the syndicated exclusivity rules were eliminated, broadcasters had entered into long-term contracts with syndicators; these contracts allowed the broadcasters to transmit particular programs and to enforce in their local geographic areas the exclusivity rules as to those programs. The broadcasters thus claim to be the copyright owners under Section 111(d)(4) because such contracts were in effect at times pertinent to the 1983 distribution. In their view, the contracts with the syndicators constituted a purchase of the exclusivity rights that compensated the syndicators for the value of those rights for the full term of the contract. Because the existing contract prices were not altered when the syndicated exclusivity rules were eliminated, NAB argues, the syndicators continued to be compensated for the value of the now nonexistent rights while the broadcasters bore the full costs of losing those rights. We begin our analysis by noting that there is nothing in the Copyrights Act that precludes the broadcasters from being “copyright owners” in their status as holders of syndicated exclusivity rights. Under the Copyrights Act, the right to perform a motion picture or other audiovisual work may, like any exclusive right,9 be transferred in whole or in part and owned separately.",
"17 U.S.C. § 201(d)(2). Moreover, any such transfer is a “transfer of copyright ownership” with respect to that right. Id. § 101. We believe, therefore, that the broadcasters’ purchase of exclusive broadcast rights from the syndicators under the syndicated exclusivity rules might constitute a “transfer of copyright ownership” under Sections 101 and 201(d)(2). NAB reasons that, because all syndex royalties paid in 1983 were attributable to cable retransmissions of programs formerly subject to the exclusivity rules, the broadcasters are thus the “copyright owners” of all programs covered by the syndex fund.10 This conclusion is hardly inexorable, however, because broadcasters have a peculiar status with regard to the copyright interests at issue. The logical difficulty with NAB’s claim is that broadcasters *180are both “owners” and “infringers” so far as the exclusivity rules are concerned. The station that is subject to competition from cable transmission of syndicated programs into its local area also may have its own signal and syndicated programs transmitted by cable into distant areas. Viewed in their dual role, the broadcasters would seem to be an anomalous beneficiary of the syndex fund.",
"Rather, that fund would appear to be a method of compensating the relevant copyright owner, namely the syndicator, for the fact that its programs are now being viewed by a much larger audience to the benefit of cable operators. Indeed, in rejecting NAB’s claim, the Tribunal explicitly stated that the syndex fund was created because of the increased number of performances of copyrighted programs as a result of cable transmission. 51 Fed.Reg. at 12,814. In fact, until NAB asserted its claim, all relevant parties appear simply to have assumed that the syndicators would be the prime beneficiaries of the syndex fund.",
"The history of the FCC’s rulemaking includes a statement by the Association of Independent Television Stations, Inc., acknowledging that new royalties resulting from the elimination of syndicated exclusivity rules would be distributed under Section 111(d) to “the copyright owner of the programming aired, not the station.” Comments before the FCC, Joint Appendix (“J.A.”) 803. After the FCC eliminated the exclusivity rules, NAB played no role in the Tribunal’s proceedings that established the syndex rate, but limited its participation to the 3.75% rate proceedings. Were the matter to be decided on the record in this proceeding alone, we would deny the petition on the ground that elimination of syndicated exclusivity rights increased the demand for and exposure of syndicated programs, thus justifying increased royalties paid by the cable operators to the syndicators in the form of the syndex fund.",
"However, we do not write on a clean slate. The syndex fund was established by the Tribunal and upheld by the Court of Appeals for the District of Columbia Circuit on an entirely different ground, namely that elimination of the syndicated exclusivity rules would injure broadcasters economically and thereby cause them to bid less for syndicated programming. NCTA v. CRT, 724 F.2d 176 (D.C.Cir.1983). That court stated: [The Tribunal] credited evidence that distant signal importation by cable diverted audiences from local broadcast stations that had purchased exclusive community rights to syndicated programming; diminished audiences meant lower advertising revenues which translated into reduced bids for programming____ The Tribunal rejected [the cable operators’] assertion, made in opposition to a fee increase, that distant signal audiences generate additional advertising revenue for broadcast stations whose signals are retransmitted by cable____ Based primarily on its conclusion that copyright owners were economically harmed by the programming duplication occasioned by cable importation of distant signals, the Tribunal ordered an upward adjustment in the royalty schedule for “old” distant signals to reflect repeal of syndicated exclusivity protection____ Our review of the record satisfies us that substantial evidence supports the Tribunal’s findings that cable importation of distant broadcast signals harms local purchasers of syndicated programming, and that television broadcasters are not compensated by advertisers for the additional distant audiences generated by cable retransmissions.",
"724 F.2d at 188-89. The syndex fund was not established on the theory that cable operators should pay additional royalties for the increased audiences that received syndicated programs after the abolition of the exclusivity rules. Rather, it was based on the theory that local broadcasters would not attract additional advertising in their role as “infringers” sending their signals to distant audiences but would suffer advertising losses from duplication in programming *181resulting from distant signals transmitted to their local areas by cable.11 This competitive injury to local broadcasters, it was stated, would reduce their bidding for syndicated programming and thereby reduce the revenues received by syndicators.12 The syndex fund was thus intended to compensate for the losses caused by the elimination of exclusivity protection, not for the increased exploitation of copyrighted works by cable operators. The Tribunal’s original rationale for the syndex fund gives life to NAB’s claim. Because the fund is to compensate for the losses that will not be passed on to the syndicators until existing contracts with the broadcasters expire and new bidding begins, those losses are presumably borne for an initial period of time by the local broadcasters. However, the Tribunal had a second and firmer ground for rejecting NAB’s claim.",
"It stated: We ... note that the broadcast industry was on notice from 1976 that the syndicated exclusivity rules were subject to change. The stations were also on notice by the consistent representation of the industries in the legislative history and the rulings of the Tribunal that royalties for permitted performances would be awarded to the creators of the works. We can only assume that this awareness was reflected in contract negotiations and accommodations, to the extent necessary, were made accordingly. 51 Fed.Reg. at 12,814. Although this argument hardly accounts for the Tribunal’s inconstancy of position on the syndex fund, it is sufficient to justify the denial of NAB’s claim. The record in the FCC rulemaking contains a statement by the broadcasters that they would have no claim to royalties resulting from elimination of the syndicated exclusivity rules. Comments of the Association of Independent Television Stations, Inc. before the FCC, In the Matter of Cable Television Syndicated Program Exclusivity Rules, Docket No.",
"20988 (March 1, 1977). Consistent with that view, the NAB essentially played no role in the Tribunal proceedings relating to establishment of the syndex fund, leaving the field entirely to the contest between the syndicators and cable operators. When the broadcasters entered into the contracts upon which they rely so heavily, therefore, they knew that the exclusivity rules might be eliminated before the contracts expired. They also knew at various pertinent times that the syndicators had, through efforts before the FCC and the Tribunal, positioned themselves to claim the entirety of any syndex royalties (but for the Music Claimants) authorized by the Tribunal.",
"We therefore believe the Tribunal was entitled to assume, particularly in light of NAB’s failure to put any of the contracts in the record, that broadcasters were fully aware that an uncompensated loss of exclusivity rights was likely to occur before the contracts expired. This awareness is at odds with the argument that the contract price was intended to cover such rights for the full term. Because NAB’s claim to syndex royalties is founded on the latter view of the contracts in question, it must be rejected. C. Other Claims of Error The remainder of petitioners’ arguments involve various fact-based challenges to the particular royalty percentages set by the Tribunal. Because none of these claims comes close to establishing that the Tribunal’s allocations are unreasonable in light of its unusual statutory responsibilities and the inevitable degree of arbitrariness in royalty determinations, we decline to discuss them in detail. *182The Canadian Claimant’s challenge to the basic fund award merits brief explicit consideration. The Tribunal has awarded the Canadian Claimants 0.75% of the basic fund in previous distribution proceedings.",
"As they have attempted unsuccessfully to establish in the past, see NAB v. CRT II, 772 F.2d at 935-36 (seeking an increase based on new evidence in the 1980 proceedings), the Canadian Claimants argue that new evidence that they presented in the 1983 proceedings required an increase in their basic fund award. Specifically, they maintain that the Tribunal should have recognized for the first time the marketplace value of French-language programming. The Canadians particularly challenge the lack of an award for French-language programming, noting the D.C. Circuit’s cautionary words: [W]e will scrutinize carefully, within the limited scope of our review under the APA, the Tribunal’s determination that a claimant’s retransmitted works are of such negligible marketplace value and/or of such negligible benefit to cable operators that no award at all is reasonable. CBN v. CRT, 720 F.2d at 1305. However, this “caveat” referred specifically to “the Tribunal’s failure to award several claimants any shares of the Fund at all.” Id.",
"at 1304. Here, while the Tribunal refused to accord any value to one aspect of the Canadians’ programming — French-language signals — the Tribunal’s overall distribution of 0.75% of the basic fund and 0.25% of the 3.75% fund to Canadian Claimants clearly cannot be characterized as “no award.” Accordingly, we need not heighten our level of scrutiny of the Canadian Claimants’ basic fund award. The new evidence presented by Canadian Claimants in 1983 consisted primarily of a “qualitative” survey of cable operators in twenty-five of the nation’s approximately 1,570 “Form 3” cable systems.13 All twenty-five cable operators carried Canadian programs, and were questioned only about that programming. The Tribunal found this survey flawed, however, in that it encouraged only positive responses about Canadian programming and provided no comparison of the value of that programming relative to other programming. See NAB v. CRT II, 772 F.2d at 935 (“[Tlhe issue is not whether the Canadians objectively improved the quality of their evidentiary submissions, but rather whether any such improvement was sufficient to warrant an award from the 1980 fund greater than the 1979 award, in light of the submissions made by other claimants.”).",
"The Tribunal’s rejection of the Canadians’ new survey was thus within the zone of reasonableness. The Canadian Claimants’ other arguments are similarly unpersuasive. The Tribunal has consistently rejected the use of any fee-generated formula as a mechanical means for allocating royalties, and instead has based its distributions on all of the relevant data presented. See, e.g., 51 Fed.Reg. at 12,808; 47 Fed Reg. 9879, 9894 (1982) (1979 proceeding); 45 Fed.Reg. 63,-026, 63,035 (1980) (1978 proceeding). Thus, evidence of mere carriage does not compel distribution to the Canadians of royalties generated by French-language programming. The remainder of the Canadians’ case hinges on the testimony of one Francophile cable subscriber and a Sports Claimants’ cable operator. Neither of these is sufficient as a matter of law to require a change in the Tribunal’s 1980 conclusion that French-language programming has no significant value to American cable systems. See NAB v. CRT II, 772 F.2d at 936. We conclude that the Tribunal’s 1983 cable royalty allocations were well within the “zone of reasonableness” in all other respects not discussed above. Accordingly, petitioners’ other claims of error are without merit.",
"We answer their challenges en masse by adopting the following admonition of the District of Columbia Circuit: *183We emerge from our analysis of these inherently subjective judgment calls and rough balancing of hotly competing claims with one overriding conclusion: it is the Tribunal which Congress, for better or worse, has entrusted with an unenviable mission of dividing up the booty among copyright holders____ [WJith today’s decision joining the ranks of our two prior exercises of review, the broad discretion necessarily conferred upon the Copyright Royalty Tribunal in making its distributions is emphatically clear. We will not hesitate henceforth, should this tack of litigation-to-the-hilt continue to characterize the aftermath of CRT distribution decisions, to refrain from elaborately responding to the myriad of claims and contentions advanced by a highly litigious copyright-owner subculture. NAB v. CRT II, 772 F.2d at 940. The Tribunal’s decision is upheld in all respects, and the petitions for review are denied. . Generally speaking, distant signals are originated by television stations outside the local market in which the cable system is located. Cable systems also carry a wide variety of programming not at issue here, such as satellite-delivered movie and sports channels.",
". The Act provides that cable royalty claimants \"may agree among themselves as to the proportionate division\" of the Fund. 17 U.S.C. § 111(d)(5)(A). If, however, after the first day of August of each year, the Tribunal finds that some or all parties are not in agreement, it must conduct a \"proceeding” to determine the proper distribution of the controverted portion of the fund. Id. § 111(d)(5)(B). .",
"In Malrite T. V. we described the operation of the syndicated exclusivity rules: [I]n the top 50 markets, at the request of a local station, cable operators must delete all syndicated programs under exclusive exhibition contract to the requesting station, regardless of when the program is scheduled for showing on the local station, and program copyright owners can request deletion for one year after the first syndicated sale of the program, even if no local station has the rights to exhibit it. In the second 50 markets, distant syndicated programs need not be deleted if broadcast in prime time unless the requesting local station is also planning to air the program in prime time, and exclusivity rights expire at specified time periods or on the occurrence of specified events, depending on the nature of the program, e.g., first-run syndicated series and feature films are protected for two years while reruns of network series are protected for only one year.",
"Only systems in the top 100 markets are subject to these rules. 652 F.2d at 1145 n. 5. . NAB’s Phase II claim as a member of the Program Supplier category must be distinguished from NAB's Phase I claim, see infra, where NAB competed with the Program Suppliers for royalties from the syndex fund. NAB’s Phase II claim derives from the small number of syndicated programs produced by local broadcast stations; in Phase I, NAB represented the stations in their capacity as broadcasters, rather than as producers. .",
"NAB does not challenge the Tribunal’s award of 4.50% of the syndex fund to Music Claimants for the use of music in syndicated programs. . Devotional Claimants withdrew their petition for review but retained the right to raise the same arguments as a party intervenor. In addition, Devotional Claimants filed a separate intervenor’s brief to oppose MPAA’s attempt to reduce their basic and 3.75% fund awards. .",
"Devotional Claimants concede that parties such as Joint Sports Claimants, PBS, and Canadian Claimants, whose programming was never subject to the syndicated exclusivity rules, are not eligible to receive fees generated by the syndex surcharge. Similarly, because cable carriage of noncommercial educational stations was not limited by the old distant signal rules, PBS is not eligible for royalties at the new 3.75% rate. . The Tribunal noted that it would prefer a more extensive record in subsequent proceedings regarding the relative worth of Phase II claimants’ programming at the various royalty rates. 51 Fed.Reg. at 12,818. . Section 106 of the 1976 Act lists the specific exclusive rights that comprise a copyright. These include the rights (1) to reproduce the copyrighted work in copies or phonorecords; (2) to prepare derivative works based upon the copyrighted work; (3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending; (4) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, to perform the copyrighted work publicly; and (5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly. 17 U.S.C.",
"§ 106. Cable retransmissions are recognized as public performances under § 106(4). See, e.g., WGN Continental Broadcasting Co. v. United Video, Inc., 693 F.2d 622, 625 (7th Cir. 1982); Eastern Microwave, Inc. v. Doubleday Sports, Inc., 691 F.2d 125, 128 (2d Cir.1982), cert. denied, 459 U.S. 1226, 103 S.Ct. 1232, 75 L.Ed.2d 467 (1983). . The Tribunal reasoned that because broadcasters may no longer obtain syndicated exclusivity rights, they cannot be copyright owners within the meaning of Section 111(d)(4). However, that argument would also preclude the syndicators from claiming the syndex fund because they also can no longer sell or exercise syndicated exclusivity rights. . The present record contains evidence that the broadcasters have actually benefited from the elimination of the exclusivity rules. See, e.g., J.A. 257 (independent station ratings in top 20 markets increased after repeal); J.A. 278 (independent station advertising revenues in top 20 markets increased after repeal).",
". The record in the present proceeding suggests that such losses to syndicators are improbable. . Form 3 cable systems are those that grossed more than $214,000 semiannually and paid royalties based on the type of distant signal they carried. 51 Fed.Reg. at 12,797."
] | https://www.courtlistener.com/api/rest/v3/opinions/8947178/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case 17-31795 Doc 828 Filed 04/22/19 Entered 04/22/19 11:01:47 Desc Main Document Page 1 of 2
UNITED STATES BANKRUPTCY COURT WESTERN DISTRICT OF NORTH CAROLINA CHARLOTTE DIVISION
In re Chapter 11
BESTWALL LLC,1 Case No. 17-31795 (LTB)
Debtor.
NOTICE OF AGENDA OF MATTERS SCHEDULED FOR HEARING ON APRIL 25, 2019
Time of Hearing: 9:30 a.m. (prevailing Eastern Time)
Location of Hearing: Courtroom of the Honorable Chief Judge Laura T. Beyer, United States Bankruptcy Court for the Western District of North Carolina, Charlotte Division, Courtroom 1-5, 401 West Trade Street, Charlotte, North Carolina 28202
UNCONTESTED MATTERS
1. Motion of the Debtor for an Order Authorizing Actions With Respect to Subleases [Docket No. 824] (the “Motion”).
Status: The hearing on this matter is going forward.
Objection Deadline: April 18, 2019.
Related Documents: None to date.
Objections Received: None to date.
1 The last four digits of the Debtor’s taxpayer identification number are 5815. The Debtor’s prior address was 100 Peachtree Street, N.W., Atlanta, Georgia 30303. Subject to the Court granting the relief requested in the Motion, effective as of April 15, 2019, the Debtor’s address has been 133 Peachtree Street, N.W., Atlanta, Georgia 30303.
NAI-1507122373 Case 17-31795 Doc 828 Filed 04/22/19 Entered 04/22/19 11:01:47 Desc Main Document Page 2 of 2
Dated: April 22, 2019 Respectfully submitted, Charlotte, North Carolina /s/ Garland S. Cassada Garland S. Cassada (NC Bar No. 12352) David M. Schilli (NC Bar No. 17989) Andrew W.J. Tarr (NC Bar No. 31827) ROBINSON, BRADSHAW & HINSON, P.A. 101 North Tryon Street, Suite 1900 Charlotte, North Carolina 28246 Telephone: (704) 377-2536 Facsimile: (704) 378-4000 E-mail: gcassada@robinsonbradshaw.com dschilli@robinsonbradshaw.com atarr@robinsonbradshaw.com
Gregory M. Gordon (TX Bar No. 08435300) JONES DAY 2727 North Harwood Street, Suite 500 Dallas, Texas 75201 Telephone: (214) 220-3939 Facsimile: (214) 969-5100 E-mail: gmgordon@jonesday.com (Admitted pro hac vice)
Jeffrey B. Ellman (GA Bar No. 141828) Brad B. Erens (IL Bar No. 06206864) JONES DAY 1420 Peachtree Street, N.E., Suite 800 Atlanta, Georgia 30309 Telephone: (404) 581-3939 Facsimile: (404) 581-8330 E-mail: jbellman@jonesday.com bberens@ jonesday.com (Admitted pro hac vice)
ATTORNEYS FOR DEBTOR AND DEBTOR IN POSSESSION
-2- NAI-1507122373 | 2019-04-22 | [
"Case 17-31795 Doc 828 Filed 04/22/19 Entered 04/22/19 11:01:47 Desc Main Document Page 1 of 2 UNITED STATES BANKRUPTCY COURT WESTERN DISTRICT OF NORTH CAROLINA CHARLOTTE DIVISION In re Chapter 11 BESTWALL LLC,1 Case No. 17-31795 (LTB) Debtor. NOTICE OF AGENDA OF MATTERS SCHEDULED FOR HEARING ON APRIL 25, 2019 Time of Hearing: 9:30 a.m. (prevailing Eastern Time) Location of Hearing: Courtroom of the Honorable Chief Judge Laura T. Beyer, United States Bankruptcy Court for the Western District of North Carolina, Charlotte Division, Courtroom 1-5, 401 West Trade Street, Charlotte, North Carolina 28202 UNCONTESTED MATTERS 1.",
"Motion of the Debtor for an Order Authorizing Actions With Respect to Subleases [Docket No. 824] (the “Motion”). Status: The hearing on this matter is going forward. Objection Deadline: April 18, 2019. Related Documents: None to date. Objections Received: None to date. 1 The last four digits of the Debtor’s taxpayer identification number are 5815. The Debtor’s prior address was 100 Peachtree Street, N.W., Atlanta, Georgia 30303. Subject to the Court granting the relief requested in the Motion, effective as of April 15, 2019, the Debtor’s address has been 133 Peachtree Street, N.W., Atlanta, Georgia 30303. NAI-1507122373 Case 17-31795 Doc 828 Filed 04/22/19 Entered 04/22/19 11:01:47 Desc Main Document Page 2 of 2 Dated: April 22, 2019 Respectfully submitted, Charlotte, North Carolina /s/ Garland S. Cassada Garland S. Cassada (NC Bar No. 12352) David M. Schilli (NC Bar No.",
"17989) Andrew W.J. Tarr (NC Bar No. 31827) ROBINSON, BRADSHAW & HINSON, P.A. 101 North Tryon Street, Suite 1900 Charlotte, North Carolina 28246 Telephone: (704) 377-2536 Facsimile: (704) 378-4000 E-mail: gcassada@robinsonbradshaw.com dschilli@robinsonbradshaw.com atarr@robinsonbradshaw.com Gregory M. Gordon (TX Bar No. 08435300) JONES DAY 2727 North Harwood Street, Suite 500 Dallas, Texas 75201 Telephone: (214) 220-3939 Facsimile: (214) 969-5100 E-mail: gmgordon@jonesday.com (Admitted pro hac vice) Jeffrey B. Ellman (GA Bar No. 141828) Brad B. Erens (IL Bar No. 06206864) JONES DAY 1420 Peachtree Street, N.E., Suite 800 Atlanta, Georgia 30309 Telephone: (404) 581-3939 Facsimile: (404) 581-8330 E-mail: jbellman@jonesday.com bberens@ jonesday.com (Admitted pro hac vice) ATTORNEYS FOR DEBTOR AND DEBTOR IN POSSESSION -2- NAI-1507122373"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/107652549/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION
Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Claim Rejections - 35 USC § 102 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of the appropriate paragraphs of 35 U.S.C. 102 that form the basis for the rejections under this section made in this Office action: A person shall be entitled to a patent unless –
(a)(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.
Claim 1 is rejected under 35 U.S.C. 102(a)(1) as being anticipated by Sadowski (US 6,007,069). With regard to claim 1, Sadowski discloses a mechanical seal (as seen in Figs. 1-10) for sealing an annular gap (Examiner notes that this and the following limitations in the preamble are intended use limitations and that the seal of Sadowski is capable of as it is shown in stalled in a gap as seen in Figs. 1, 9, and 10) between a rotary shaft (216, 816, 916) and a housing (212, 812, 912) having a shaft hole (i.e. the bore of 212, 812, 912 that the shaft is shown as in in Figs. 1, 9, and 10) into which the rotary shaft is to be inserted (as seen in Figs. 1, 9, and 10), the .
Response to Arguments Applicant's arguments with respect to claim 1 has been considered but are moot in view of the new ground(s) of rejection. In so much as they apply to the new grounds of rejection above, Applicant’s arguments filed 29 July 2021 have been fully considered but are not persuasive. Specifically all of Applicant’s new arguments are with respect to the new amendment, which have been fully rejected in the new/amended grounds of rejection above (see the detailed explanation above). Additionally it appears Applicant may be interpreting the amended claim limitations more specifically than their broadest reasonable interpretation and it is noted that although the claims are interpreted in light of the specification, limitations from the specification are not read into the claims. See In re Van Geuns, 988 F.2d 1181, 26 USPQ2d 1057 (Fed. Cir. 1993). In the interest of advancing prosecution Examiner recommends claiming the axial direction is with respect to a specific annular element, and a limitation to further specify the shape of the bellows (e.g. that it’s cross-section has an overall axial length greater than an overall radial height). However Examiner notes such would likely still be obvious in view of other cited
Conclusion Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the date of this final action. Any inquiry concerning this communication or earlier communications from the examiner should be directed to NICHOLAS L FOSTER whose telephone number is (571)270-5354. The examiner can normally be reached on M-F 9:00am-6:30pm. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice.
Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
/NICHOLAS L FOSTER/ Primary Examiner, Art Unit 3675 | 2021-08-08T11:04:10 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claim Rejections - 35 USC § 102 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of the appropriate paragraphs of 35 U.S.C. 102 that form the basis for the rejections under this section made in this Office action: A person shall be entitled to a patent unless – (a)(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.",
"Claim 1 is rejected under 35 U.S.C. 102(a)(1) as being anticipated by Sadowski (US 6,007,069). With regard to claim 1, Sadowski discloses a mechanical seal (as seen in Figs. 1-10) for sealing an annular gap (Examiner notes that this and the following limitations in the preamble are intended use limitations and that the seal of Sadowski is capable of as it is shown in stalled in a gap as seen in Figs. 1, 9, and 10) between a rotary shaft (216, 816, 916) and a housing (212, 812, 912) having a shaft hole (i.e. the bore of 212, 812, 912 that the shaft is shown as in in Figs. 1, 9, and 10) into which the rotary shaft is to be inserted (as seen in Figs.",
"1, 9, and 10), the . Response to Arguments Applicant's arguments with respect to claim 1 has been considered but are moot in view of the new ground(s) of rejection. In so much as they apply to the new grounds of rejection above, Applicant’s arguments filed 29 July 2021 have been fully considered but are not persuasive. Specifically all of Applicant’s new arguments are with respect to the new amendment, which have been fully rejected in the new/amended grounds of rejection above (see the detailed explanation above). Additionally it appears Applicant may be interpreting the amended claim limitations more specifically than their broadest reasonable interpretation and it is noted that although the claims are interpreted in light of the specification, limitations from the specification are not read into the claims. See In re Van Geuns, 988 F.2d 1181, 26 USPQ2d 1057 (Fed. Cir. 1993). In the interest of advancing prosecution Examiner recommends claiming the axial direction is with respect to a specific annular element, and a limitation to further specify the shape of the bellows (e.g.",
"that it’s cross-section has an overall axial length greater than an overall radial height). However Examiner notes such would likely still be obvious in view of other cited Conclusion Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the date of this final action.",
"Any inquiry concerning this communication or earlier communications from the examiner should be directed to NICHOLAS L FOSTER whose telephone number is (571)270-5354. The examiner can normally be reached on M-F 9:00am-6:30pm. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free).",
"If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. /NICHOLAS L FOSTER/ Primary Examiner, Art Unit 3675"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2021-08-08.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
{¶ 1} The judgment of the court of appeals is affirmed on the authority of State v. Mbodji 129 Ohio St.3d 325, 2011-Ohio-2880, 951 N.E.2d 1025. O’Connor, C.J., and Lundberg Stratton, Lanzinger, Cupp, and McGee Brown, JJ., concur. Pfeifer and O’Donnell, JJ., dissent. | 07-21-2022 | [
"{¶ 1} The judgment of the court of appeals is affirmed on the authority of State v. Mbodji 129 Ohio St.3d 325, 2011-Ohio-2880, 951 N.E.2d 1025. O’Connor, C.J., and Lundberg Stratton, Lanzinger, Cupp, and McGee Brown, JJ., concur. Pfeifer and O’Donnell, JJ., dissent."
] | https://www.courtlistener.com/api/rest/v3/opinions/6796609/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION
Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Status of the Claims This first non-final action is in response to applicant's Request for Continued Examination (RCE) of August 09, 2022. Claims 1-4, 6-11 are pending and have been considered as follows.
Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to consider the applicability of 35 U.S.C. 102(b)(2)(C) for any potential 35 U.S.C. 102(a)(2) prior art against the later invention.
Claims 1, 4, 6-7 and 10 are rejected under 35 U.S.C. 103 as being obvious by Palviainen (WO2017180366A1) in view of Bai (US 20190163204A1). Regarding claim 1, Palviainen teaches an automated valet parking system that automatically moves an autonomous driving vehicle to a pick-up space of a parking place by issuing an instruction to the autonomous driving vehicle parked in the parking place according to a pick-up request from a user frontend ([0003] Systems and methods enable more efficient flow of traffic around a large, multi-exit venue where many people may be simultaneously requesting their autonomous vehicles to arrive for pickup; [0004]-[0007], The smart space manger directs the vehicle and the user to the selected exit; designates particular time slots for vehicle pickups at each exit; to bring an AV available to a user when he or she needs it, e.g., when a user exits an indoor complex) the system comprising a processor configured to ([0079] a processor 718): determine whether or not the user frontend of a user is located within a vicinity of a preset-pick-up area including the pick-up space ([0044]- [0046] the smart space tracks the user's movement, predict which exit the user will take and when; [0026] the smart space exit manager 138 schedules time slots for pickup traffic outside the exit for autonomous vehicles); receive the pick-up request in response to determining that the user frontend is located within the vicinity of the preset-pick-up area instruct the autonomous driving vehicle that is a target of the pick-up request to move to the pick-up space when the pick-up request is received ([0046]-[0048] the user notifies 424 the SSM 404 of her wish to leave the smart space. Alternatively, the smart space manager 404 may determine that the user is about to exit the mall, via the predicted exit; [0034] In response to a user pressing the Follow Me button, the autonomous driving (or Follow Me) mode 208 allows the autonomous vehicle to be directed to drive to a selected exit of a smart space. [0004]- [0007] directs the vehicle and the user to the selected exit). Palviainen does not explicitly teach but Bai teaches continuously acquire a position information from the user frontend ( [0023]acquiring position information (GPS) from the user frontend (mobile device 180); The mobile device 180 may include a GPS unit 170, an interface 172, one or more applications 182, 182′, a communication unit 184.The system 100 may also communicate with or receive information from a server 190 via the communication unit 112 ), and when the determination is made that the user frontend is located within the vicinity of the preset pick-up area including the pick-up space([0042]-[0047] premature arrival of the individual at the pick-up location based on (among other things) GPS location of the individual. “vicinity”, timing controller being used to synchronize the arrival of the user and the vehicle at the pick-up location), notify the user frontend of the pickup start based on the pick-up request ([0044] the timing controller 114 may suggest a change to the pick-up time, notifying the individual that exiting during the seventh inning would save fifteen minutes in drive time, for example. This notification may be transmitted by the communication unit 112 to the mobile device 180, and rendered as a visual or audio notification by the application 182 of the mobile device 180 on the interface 172 of the mobile device 180. In this way, the timing controller 114 may suggest alternative pick-up times and/or locations based on aspects related to the activity of the event at which the individual is attending). It would have been obvious to one of ordinary skill in the art before the effective date of the present invention to modify, automatic calling of a parked vehicle to meet a user at a predetermined place within a parking structure/lot based on the current position of the user in relation to the pick-up location, as taught by Palviainen, continuously acquiring a position information from the user frontend and notifying the user frontend when the user frontend is within the vicinity of the preset pick-up area, as taught by Bai, as Palviainen and Bai are directed to vehicle automatically moving to a pick-up area to pick up a passenger (same field of endeavor), and one of ordinary skill in the art would have recognized the established utility using continuously acquiring a position information from the user frontend and notifying the user frontend when the user frontend is within the vicinity of the preset pick-up area and predictably applied it to Palviainen to determine an adjusted pick-up time associated with the pick-up of the individual based on the timing factor and determine a departure time for the autonomous pick-up of the individual based on the adjusted pick-up time ([0004], Bai). Regarding claim 7 please see the rejection above with regarding claim 1, which is commensurate in scope to claim 7, with claim 1 being drawn to a system and claim 7 being drawn to a corresponding method. Regarding claim 4, Palviainen teaches wherein the processor is further configured to notify the user frontend of a pick-up start of the autonomous driving vehicle (Fig. 2 and [0034] show that the autonomous driving (or Follow Me) mode 208 notifies the user the autonomous vehicle to be directed to drive to a selected exit of a smart space). Regarding claim 10 please see the rejection above with regarding claim 4, which is commensurate in scope to claim 10, with claim 4 being drawn to a system and claim 10 being drawn to a corresponding method.
Regarding claim 6, Palviainen teaches wherein the vicinity of the preset-pick-up area includes at least a part of a moving path for the user to go to the pick-up space (Fig. 3, Exits 1-3 show a walking path for user to go to the pick-up space (Exits)).
Claims 2 and 8 are rejected under 35 U.S.C. 103 as being obvious by Palviainen (WO2017180366A1) in view of Bai (US 20190163204A1) and further in view of Kunihiro (JPH0510046A). Regarding claim 2, Palviainen as modified by Bai does not explicitly teach but Kunihiro teaches wherein the vicinity of the preset-pick-up area (Fig. 2, [0006] English Translation of Kunihiro, the multi-story car park is a connecting road 5 between the upper part of Hall 3 and the ground ) includes at least a part of a parking place-side elevator hall located on the same floor as the pick-up space of the parking place ([0005] English Translation, a multi-story parking lot having parking floors hierarchically, a plurality of annular floors are concentrically arranged around a central floor to form floors of each floor, A part of the central floor or the circular floor is configured to be rotatable, a hall is formed facing the outermost circular floor of each floor, and an elevator floor for automobile transportation is arranged in this hall so that it can be raised and lowered), and at least a part of another floor elevator hall where an elevator of the parking place-side elevator hall stops on a different floor from the parking place-side elevator hall ( [0006]-[0008] English Translation, one or two lifting floors 4 are arranged so as to be able to move up and down. When two lifting floors 4 are provided, a loading section 6 provided between the communication path 5 and the upper portion of the hall 3; providing an elevator floor that vertically transports the vehicle on the outside of the torus floor). It would have been obvious to one of ordinary skill in the art before the effective date of the present invention to use the system of Kunihiro which teaches that a parking structure/lot can include an elevator and the hall surrounding such elevator with the automatic valet system of Palviainen as modified by Bai, as the system of Palviainen as modified by Bai is directed to the automatic calling of a parked vehicle to meet a user at a predetermined place within a parking structure/lot based on the current position of the user in relation to the pick-up location and one of ordinary skill in the art would have understood that a parking lot/parking structure can include multiple levels and an elevator and understood that a person may be located in or around the elevator when calling for the vehicle based on the teachings of Kunihiro and would have predictably applied the teachings of Kunihiro to improve the system of Palviainen as modified by Bai.
Regarding claim 8 please see the rejection above with regarding claim 2, which is commensurate in scope to claim 8, with claim 2 being drawn to a system and claim 8 being drawn to a corresponding method.
Claims 3, 9 and 11 are rejected under 35 U.S.C. 103 as being obvious by Palviainen (WO2017180366A1) in view of Bai (US 20190163204A1) and further in view of Seki (US 20190243368 A1). Regarding claim 3, Palviainen as modified by Bai does not explicitly teaches but Seki teaches -2-Application Serial No.: 17/027,838 Docket No.: 94377-1135 08TMCT121202PA in a case where the user frontend is not located within the vicinity of the preset-pick-up area when the pick-up request is made, the processor is further configured to perform a pick-up reservation reception which receives the pick-up request as a reservation ([0087]-[0089] the distance to the pick-up area Ab can be calculated as the distance from the aforementioned parking spot to the pick-up area Ab; if “t1≤T1+margin α” does not hold (frontend is not located in the pick-up area or the near-pick-up area), the controller 11 does not instruct the vehicle to move to pick-up area until predicted user arrival time t1 satisfies “t1≤T1+margin α” (reservation)); and in a case where the user frontend is located within the vicinity of the preset-pick-up area after the pick-up reservation reception is performed, the processor is further configured to automatically receive the pick-up request ([0091]-[0092] if the condition “t1≤T1+margin α” ( frontend is located in the pick-up area or the near-pick-up area) is met, vehicle 2 is instructed to move to the pick-up area Ab at a timing that takes the predicted user arrival time t1 and the predicted vehicle arrival time T1 into consideration). It would have been obvious to one of ordinary skill in the art before the effective date of the present invention to modify, automatic calling of a parked vehicle to meet a user at a predetermined place within a parking structure/lot based on the current position of the user in relation to the pick-up location, as taught by Palviainen as modified by Bai, performing a pick-up reservation, as taught by Seki, as Palviainen, Bai, and Seki are directed to vehicle automatically moving to a pick-up area to pick up a passenger (same field of endeavor), and one of ordinary skill in the art would have recognized the established utility using a pick-up reservation and predictably applied it to Palviainen as modified by Bai to manage a movement start timing at which the vehicle to be called starts moving to the pick-up area on the basis of the predicted user arrival time ([0142], Seki).
Regarding claim 9 please see the rejection above with regarding claim 3, which is commensurate in scope to claim 9, with claim 3 being drawn to a system and claim 9 being drawn to a corresponding method.
Regarding claim 11, Palviainen as modified by Bai teaches further comprising continuously receiving position information from the user frontend in response to receiving a user consent (Bai, [0023] acquiring position information (GPS) from the user frontend (mobile device 180); The mobile device 180 may include a GPS unit 170, an interface 172, one or more applications 182, 182′, a communication unit 184.The system 100 may also communicate with or receive information from a server 190 via the communication unit 112, [0042]-[0047]).
Conclusion
Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor Anne Antonucci can be reached on (313)446-6519. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair. Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-100.
/J.W./Examiner, Art Unit 3666
/ANNE MARIE ANTONUCCI/Supervisory Patent Examiner, Art Unit 3666 | 2022-09-17T10:54:37 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Status of the Claims This first non-final action is in response to applicant's Request for Continued Examination (RCE) of August 09, 2022. Claims 1-4, 6-11 are pending and have been considered as follows. Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains.",
"Patentability shall not be negated by the manner in which the invention was made. The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to consider the applicability of 35 U.S.C.",
"102(b)(2)(C) for any potential 35 U.S.C. 102(a)(2) prior art against the later invention. Claims 1, 4, 6-7 and 10 are rejected under 35 U.S.C. 103 as being obvious by Palviainen (WO2017180366A1) in view of Bai (US 20190163204A1). Regarding claim 1, Palviainen teaches an automated valet parking system that automatically moves an autonomous driving vehicle to a pick-up space of a parking place by issuing an instruction to the autonomous driving vehicle parked in the parking place according to a pick-up request from a user frontend ([0003] Systems and methods enable more efficient flow of traffic around a large, multi-exit venue where many people may be simultaneously requesting their autonomous vehicles to arrive for pickup; [0004]-[0007], The smart space manger directs the vehicle and the user to the selected exit; designates particular time slots for vehicle pickups at each exit; to bring an AV available to a user when he or she needs it, e.g., when a user exits an indoor complex) the system comprising a processor configured to ([0079] a processor 718): determine whether or not the user frontend of a user is located within a vicinity of a preset-pick-up area including the pick-up space ([0044]- [0046] the smart space tracks the user's movement, predict which exit the user will take and when; [0026] the smart space exit manager 138 schedules time slots for pickup traffic outside the exit for autonomous vehicles); receive the pick-up request in response to determining that the user frontend is located within the vicinity of the preset-pick-up area instruct the autonomous driving vehicle that is a target of the pick-up request to move to the pick-up space when the pick-up request is received ([0046]-[0048] the user notifies 424 the SSM 404 of her wish to leave the smart space.",
"Alternatively, the smart space manager 404 may determine that the user is about to exit the mall, via the predicted exit; [0034] In response to a user pressing the Follow Me button, the autonomous driving (or Follow Me) mode 208 allows the autonomous vehicle to be directed to drive to a selected exit of a smart space. [0004]- [0007] directs the vehicle and the user to the selected exit). Palviainen does not explicitly teach but Bai teaches continuously acquire a position information from the user frontend ( [0023]acquiring position information (GPS) from the user frontend (mobile device 180); The mobile device 180 may include a GPS unit 170, an interface 172, one or more applications 182, 182′, a communication unit 184.The system 100 may also communicate with or receive information from a server 190 via the communication unit 112 ), and when the determination is made that the user frontend is located within the vicinity of the preset pick-up area including the pick-up space([0042]-[0047] premature arrival of the individual at the pick-up location based on (among other things) GPS location of the individual.",
"“vicinity”, timing controller being used to synchronize the arrival of the user and the vehicle at the pick-up location), notify the user frontend of the pickup start based on the pick-up request ([0044] the timing controller 114 may suggest a change to the pick-up time, notifying the individual that exiting during the seventh inning would save fifteen minutes in drive time, for example. This notification may be transmitted by the communication unit 112 to the mobile device 180, and rendered as a visual or audio notification by the application 182 of the mobile device 180 on the interface 172 of the mobile device 180. In this way, the timing controller 114 may suggest alternative pick-up times and/or locations based on aspects related to the activity of the event at which the individual is attending). It would have been obvious to one of ordinary skill in the art before the effective date of the present invention to modify, automatic calling of a parked vehicle to meet a user at a predetermined place within a parking structure/lot based on the current position of the user in relation to the pick-up location, as taught by Palviainen, continuously acquiring a position information from the user frontend and notifying the user frontend when the user frontend is within the vicinity of the preset pick-up area, as taught by Bai, as Palviainen and Bai are directed to vehicle automatically moving to a pick-up area to pick up a passenger (same field of endeavor), and one of ordinary skill in the art would have recognized the established utility using continuously acquiring a position information from the user frontend and notifying the user frontend when the user frontend is within the vicinity of the preset pick-up area and predictably applied it to Palviainen to determine an adjusted pick-up time associated with the pick-up of the individual based on the timing factor and determine a departure time for the autonomous pick-up of the individual based on the adjusted pick-up time ([0004], Bai).",
"Regarding claim 7 please see the rejection above with regarding claim 1, which is commensurate in scope to claim 7, with claim 1 being drawn to a system and claim 7 being drawn to a corresponding method. Regarding claim 4, Palviainen teaches wherein the processor is further configured to notify the user frontend of a pick-up start of the autonomous driving vehicle (Fig. 2 and [0034] show that the autonomous driving (or Follow Me) mode 208 notifies the user the autonomous vehicle to be directed to drive to a selected exit of a smart space). Regarding claim 10 please see the rejection above with regarding claim 4, which is commensurate in scope to claim 10, with claim 4 being drawn to a system and claim 10 being drawn to a corresponding method. Regarding claim 6, Palviainen teaches wherein the vicinity of the preset-pick-up area includes at least a part of a moving path for the user to go to the pick-up space (Fig. 3, Exits 1-3 show a walking path for user to go to the pick-up space (Exits)).",
"Claims 2 and 8 are rejected under 35 U.S.C. 103 as being obvious by Palviainen (WO2017180366A1) in view of Bai (US 20190163204A1) and further in view of Kunihiro (JPH0510046A). Regarding claim 2, Palviainen as modified by Bai does not explicitly teach but Kunihiro teaches wherein the vicinity of the preset-pick-up area (Fig. 2, [0006] English Translation of Kunihiro, the multi-story car park is a connecting road 5 between the upper part of Hall 3 and the ground ) includes at least a part of a parking place-side elevator hall located on the same floor as the pick-up space of the parking place ([0005] English Translation, a multi-story parking lot having parking floors hierarchically, a plurality of annular floors are concentrically arranged around a central floor to form floors of each floor, A part of the central floor or the circular floor is configured to be rotatable, a hall is formed facing the outermost circular floor of each floor, and an elevator floor for automobile transportation is arranged in this hall so that it can be raised and lowered), and at least a part of another floor elevator hall where an elevator of the parking place-side elevator hall stops on a different floor from the parking place-side elevator hall ( [0006]-[0008] English Translation, one or two lifting floors 4 are arranged so as to be able to move up and down.",
"When two lifting floors 4 are provided, a loading section 6 provided between the communication path 5 and the upper portion of the hall 3; providing an elevator floor that vertically transports the vehicle on the outside of the torus floor). It would have been obvious to one of ordinary skill in the art before the effective date of the present invention to use the system of Kunihiro which teaches that a parking structure/lot can include an elevator and the hall surrounding such elevator with the automatic valet system of Palviainen as modified by Bai, as the system of Palviainen as modified by Bai is directed to the automatic calling of a parked vehicle to meet a user at a predetermined place within a parking structure/lot based on the current position of the user in relation to the pick-up location and one of ordinary skill in the art would have understood that a parking lot/parking structure can include multiple levels and an elevator and understood that a person may be located in or around the elevator when calling for the vehicle based on the teachings of Kunihiro and would have predictably applied the teachings of Kunihiro to improve the system of Palviainen as modified by Bai.",
"Regarding claim 8 please see the rejection above with regarding claim 2, which is commensurate in scope to claim 8, with claim 2 being drawn to a system and claim 8 being drawn to a corresponding method. Claims 3, 9 and 11 are rejected under 35 U.S.C. 103 as being obvious by Palviainen (WO2017180366A1) in view of Bai (US 20190163204A1) and further in view of Seki (US 20190243368 A1). Regarding claim 3, Palviainen as modified by Bai does not explicitly teaches but Seki teaches -2-Application Serial No. : 17/027,838 Docket No. : 94377-1135 08TMCT121202PA in a case where the user frontend is not located within the vicinity of the preset-pick-up area when the pick-up request is made, the processor is further configured to perform a pick-up reservation reception which receives the pick-up request as a reservation ([0087]-[0089] the distance to the pick-up area Ab can be calculated as the distance from the aforementioned parking spot to the pick-up area Ab; if “t1≤T1+margin α” does not hold (frontend is not located in the pick-up area or the near-pick-up area), the controller 11 does not instruct the vehicle to move to pick-up area until predicted user arrival time t1 satisfies “t1≤T1+margin α” (reservation)); and in a case where the user frontend is located within the vicinity of the preset-pick-up area after the pick-up reservation reception is performed, the processor is further configured to automatically receive the pick-up request ([0091]-[0092] if the condition “t1≤T1+margin α” ( frontend is located in the pick-up area or the near-pick-up area) is met, vehicle 2 is instructed to move to the pick-up area Ab at a timing that takes the predicted user arrival time t1 and the predicted vehicle arrival time T1 into consideration).",
"It would have been obvious to one of ordinary skill in the art before the effective date of the present invention to modify, automatic calling of a parked vehicle to meet a user at a predetermined place within a parking structure/lot based on the current position of the user in relation to the pick-up location, as taught by Palviainen as modified by Bai, performing a pick-up reservation, as taught by Seki, as Palviainen, Bai, and Seki are directed to vehicle automatically moving to a pick-up area to pick up a passenger (same field of endeavor), and one of ordinary skill in the art would have recognized the established utility using a pick-up reservation and predictably applied it to Palviainen as modified by Bai to manage a movement start timing at which the vehicle to be called starts moving to the pick-up area on the basis of the predicted user arrival time ([0142], Seki). Regarding claim 9 please see the rejection above with regarding claim 3, which is commensurate in scope to claim 9, with claim 3 being drawn to a system and claim 9 being drawn to a corresponding method.",
"Regarding claim 11, Palviainen as modified by Bai teaches further comprising continuously receiving position information from the user frontend in response to receiving a user consent (Bai, [0023] acquiring position information (GPS) from the user frontend (mobile device 180); The mobile device 180 may include a GPS unit 170, an interface 172, one or more applications 182, 182′, a communication unit 184.The system 100 may also communicate with or receive information from a server 190 via the communication unit 112, [0042]-[0047]).",
"Conclusion Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor Anne Antonucci can be reached on (313)446-6519. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of an application may be obtained from the Patent Application Information Retrieval (PAIR) system. Status information for published applications may be obtained from either Private PAIR or Public PAIR. Status information for unpublished applications is available through Private PAIR only. For more information about the PAIR system, see https://ppair-my.uspto.gov/pair/PrivatePair.",
"Should you have questions on access to the Private PAIR system, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative or access to the automated information system, call 800-786-9199 (IN USA OR CANADA) or 571-272-100. /J.W./Examiner, Art Unit 3666 /ANNE MARIE ANTONUCCI/Supervisory Patent Examiner, Art Unit 3666"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-09-25.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION The present Office action is in response to the application filing on 22 APRIL 2021 and the most recent Information Disclosure Statement.
Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Information Disclosure Statement The Information Disclosure Statements (IDS) submitted on 04/22/2021 and 9/10/2021 are in compliance with the provisions of 37 CFR 1.97. Accordingly, the Information Disclosure Statements are being considered by the Examiner.
Specification The title of the invention is not descriptive. A new title is required that is clearly indicative of the invention to which the claims are directed. The following title is suggested: --LUMINANCE DEBLOCK FILTERING ENCODING DEVICE, DECODING DEVICE, AND PROGRAM--.
Claim Rejections - 35 USC § 101 35 U.S.C. 101 reads as follows: Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.
Claims 13 and 14 are rejected under 35 U.S.C. 101 because the claimed invention is directed to non-statutory subject matter. The claim(s) does/do not fall within at least one of the four categories of patent eligible subject matter because each of claims 13 and 14 are directed to a program. In accordance with MPEP § 2106.03(I), a computer program per se is expressly defined as a product that does not have a physical or tangible form and therefore not one of the four statutory categories. Neither claim 13 nor 14 recite any physical or tangible medium by which to store or actualize the program.
Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. Claims 1-4, 7-10, 13, and 14 is/are rejected under 35 U.S.C. 103 as being unpatentable over U.S. Publication No. 2018/0302619 A1 (hereinafter “Ikeda”) in view of U.S. Publication No. 2020/0236353 A1 (hereinafter “Zhang”). Regarding claim 1, Ikeda discloses an encoding device which encodes an input image (FIG. 1, encoding device 10 for encoding the input at A/C 11) comprising: a transformer (FIG. 1, orthogonal transform section 14) configured to calculate an orthogonal transform coefficient by performing an orthogonal transformation process on a residual image indicating a difference between the input image and a predicted image of the input image ([0049], ll. 1-3, “The orthogonal transform section 14 performs an orthogonal transform on the prediction error data input from the subtraction section 13;” [0048], ll. 4-7, “The subtraction section 13 calculates prediction error data, which is the difference between the image data input from the reordering buffer 12 and the predicted image data input from the mode selecting section 50”); a quantizer (FIG. 1, quantization section 15) configured to generate quantization coefficient by quantizing the orthogonal transform coefficient based on a quantization parameter ([0050], ll. 4-5, “The quantization section 15 quantizes the transform coefficient data, and outputs the quantized transform coefficient data;” [0050], ll. 8-9, “the quantization section 15 switches a quantization parameter (a quantization scale)”); an entropy encoder (FIG. 1, lossless encoding section 16) configured to generate encoded data by encoding the quantization coefficient ([0052], ll. 1-3, “The lossless encoding section 16 generates an encoded stream by performing a lossless encoding process on the quantized data”); an image decoder (FIG. 1, dequantization section 21, inverse orthogonal transform section 22, and adding section 23) configured to restore an orthogonal transform coefficient from the quantization coefficient based on the quantization parameter ([0055], ll. 1-3, “The dequantization section 21 performs an dequantization process on the quantized data input from the quantization section 15:” e.g., the inverse of the quantization section 15, rescaling the data with the QP) and generate a pre-filtering image by adding the predicted image to a residual image restored by performing inverse orthogonal transformation on the orthogonal transform coefficient ([0056], ll. 1-4, “The inverse orthogonal transform section 22 performs an inverse orthogonal transform process on the transform coefficient data input from the dequantization section 21 to thereby restore the prediction error data;” [0057], ll. 1-4, “The addition section 23 adds the restored prediction error data input from the inverse orthogonal transform section 22 and the predicted image data input from the mode selecting section 50 to thereby generate decoded image data”); and a deblocking filter (FIG. 1, deblocking filter 24a) configured to perform a filtering process on the pre-filtering image ([0058], ll. 3-6, “the deblocking filter 24a determines the need for filtering on a per-line basis for each block boundary in the decoded image data input from the addition section 23”), wherein the deblocking filter (FIG. 1, deblocking filter 24a) is configured to control a filtering strength depending on a result of comparison between a luminance signal level of the pre-filtering image and a luminance threshold value ([0095], ll. 1-7, “If a boundary is determined to need the application of the deblocking filter, a filtering process is performed on pixels to the left and right of a vertical boundary, or on pixels above and , and the deblocking filter (FIG. 1, deblocking filter 24a) is configured to determine the luminance threshold value ([0097-0099 depict the three conditions for selecting between filter strength using a threshold value that has been determined) Ikeda fails to expressly disclose determine the luminance threshold value for each picture or each sequence. However, Zhang teaches determine the luminance threshold value for each picture or each sequence ([0038], ll. 8-12, “the de-blocking filter can be specifically determined for each picture, slice, coding tree unit (CTU) or CU. The parameters may correspond to the values of threshold (e.g. Beta0, Beta1 and Beta2), clipping boundaries (e.g. TcS, Tc0, Tc1, and TcC) or both.” Additionally, [0039] describes signaling the Bs/Tc values at the picture or sequence level). Before the effective filing date of the claimed invention, it would have been obvious to a person having ordinary skill in the art to have determined de-blocking filters for each picture at picture level, as taught by Zhang ([0038]), in Ikeda’s invention. One would have been motivated to modify Ikeda’s invention, by incorporating Zhang’s invention, to adapt the deb-blocking filter to the underlying picture or a part of the picture for improved performance ([0016]). Regarding claim 2, Ikeda and Zhang disclose all of the limitations of claim 1, as outlined above. Additionally, Zhang discloses wherein the deblocking filter is configured to determine the luminance threshold value for each sequence, and the entropy encoder is configured to transmit information indicated the luminance threshold value as a sequence parameter set to a decoding side ([0038], ll. 8-12, “the de-blocking filter can be specifically determined for each picture, slice, coding tree unit (CTU) or CU. The parameters may correspond to the values of threshold (e.g. Beta0, Beta1 and Beta2), clipping boundaries (e.g. TcS, Tc0, Tc1, and TcC) or both;” [0039], ll. 13-17, “The parameters of thresholds and clipping boundaries can be signalled in a selected syntax level, such as the video parameter set (VPS), sequence parameter set (SPS), picture parameter set (PPS), slice header (SH), coding tree unit (CTU) or CU (Coding Unit)”). The same motivation of claim 1 applies to claim 2. Regarding claim 3, Ikeda and Zhang disclose all of the limitations of claim 1, as outlined above. Additionally, Ikeda discloses wherein the deblocking filter is configured to: specify which of a plurality of luminance signal level ranges defined by the luminance threshold value covers the luminance signal level of the pre-filtering image ([0097-0099] describe the filter selection based on thresholding and luma pixel values. Note, the comparison to the threshold defines a luma range below the threshold and a luma range above the thresold); and control the filtering strength by using filtering strength control information corresponding to the specified luminance signal level range ([0097-99] defines the filter strength selection and [0100-0101] define the filter strength calculation). Regarding claim 4, Ikeda and Zhang disclose all of the limitations of claim 3, as outlined above. Additionally, Zhang discloses wherein the entropy encoder is configured to transmit filtering strength control information provided for each of the plurality of luminance signal level ranges as a sequence parameter set to a decoding side ([0038], ll. 8-12, “the de-blocking filter can be specifically determined for each picture, slice, coding tree unit (CTU) or CU. The parameters may correspond to the values of threshold (e.g. Beta0, Beta1 and Beta2), clipping boundaries (e.g. TcS, Tc0, Tc1, and TcC) or both;” [0039], ll. 13-17, “The parameters of thresholds and clipping boundaries can be signalled in a selected syntax level, such as the video parameter set (VPS), sequence parameter set (SPS), picture parameter set (PPS), slice header (SH), coding tree unit (CTU) or CU (Coding Unit);” [0015], ll. 4-10, “The B_Table corresponds to the threshold values and is signalled in the video bitstream for various QP (quantization parameters). The T_Table corresponds to the clipping boundaries and is signalled in the video bitstream for various QP and BS values. The thresholds and clipping boundaries are used in determining the parameters for filter decisions”). The same rationale of claim 1 applies to claim 4. Regarding claim 7, the limitations are the same as those in claim 1; however, written from the decoder perspective. Ikeda describes the decoder in FIG. 2 as the inverse process of the encoder depicted in FIG. 1. Therefore, the same rationale of claim 1 applies to claim 7. Regarding claim 8, the limitations are the same as those in claim 2 Regarding claim 9, the limitations are the same as those in claim 3; however, written from the decoder perspective. Therefore, the same rationale of claim 3 applies to claim 9. Regarding claim 10, the limitations are the same as those in claim 4; however, written from the decoder perspective. Therefore, the same rationale of claim 4 applies to claim 10. Regarding claim 13, the limitations are the same as those in claim 1. Therefore, the same rationale of claim 1 applies to claim 13. Additionally, Ikeda discloses a program ([0028], “The memory stores a program”). Regarding claim 14, the limitations are the same as those in claim 7. Therefore, the same rationale of claim 7 applies to claim 14. Additionally, Ikeda discloses a program ([0028], “The memory stores a program”). Claims 6 and 12 is/are rejected under 35 U.S.C. 103 as being unpatentable over U.S. Publication No. 2018/0302619 A1 (hereinafter “Ikeda”) in view of U.S. Publication No. 2020/0236353 A1 (hereinafter “Zhang”), and further in view of U.S. Publication No. 2018/0139461 A1 (hereinafter “Liu”). Regarding claim 6, Ikeda and Zhang disclose all of the limitations of claim 1, as outlined above. Additionally, Zhang discloses wherein the entropy encoder is configured to transmit to a decoding side a flag indicating whether filtering strength control ([0044], ll. 1-4, “The parameters of thresholds and clipping boundaries can be signalled by any known coding method, such as fixed length coding or VLC (variable length Ikeda and Zhang fail to expressly disclose a flag indicating whether filtering strength control depending on the luminance signal level of the pre-filtering image is enabled or not. However, Liu teaches a flag indicating whether filtering strength control depending on the luminance signal level of the pre-filtering image is enabled or not ([0025], “picture-level deblocking-filter-disable flag.” Note, disabling the deblocking filter would disable the use of the filtering strength control, as there is no deblocking process). Before the effective filing date of the claimed invention, it would have been obvious to a person having ordinary skill in the art to have a deblocking filter enablement flag, as taught by Liu ([0025]), in Ikeda and Zhang’s invention. One would have been motivated to modify Ikeda and Zhang’s invention, by incorporating Liu’s invention, to reduce the average bandwidth required for predicting ([0005] and [0013]). Regarding claim 12, the limitations are the same as those in claim 6; however, written from the decoder perspective. Therefore, the same rationale of claim 6 applies to claim 12.
Allowable Subject Matter Claims 5 and 11 are objected to as being dependent upon a rejected base claim, but would be allowable if rewritten in independent form including all of the limitations of the base claim and any intervening claims.
Conclusion Any inquiry concerning this communication or earlier communications from the examiner should be directed to STUART D BENNETT whose telephone number is (571)272-0677. The examiner can normally be reached Monday - Friday from 9:00 AM - 5PM EST. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, William Vaughn can be reached on 571-272-3922. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of published or unpublished applications may be obtained from Patent Center. Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format. For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
/STUART D BENNETT/Examiner, Art Unit 2481 | 2022-02-17T10:27:58 | [
"DETAILED ACTION The present Office action is in response to the application filing on 22 APRIL 2021 and the most recent Information Disclosure Statement. Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Information Disclosure Statement The Information Disclosure Statements (IDS) submitted on 04/22/2021 and 9/10/2021 are in compliance with the provisions of 37 CFR 1.97. Accordingly, the Information Disclosure Statements are being considered by the Examiner. Specification The title of the invention is not descriptive. A new title is required that is clearly indicative of the invention to which the claims are directed. The following title is suggested: --LUMINANCE DEBLOCK FILTERING ENCODING DEVICE, DECODING DEVICE, AND PROGRAM--. Claim Rejections - 35 USC § 101 35 U.S.C.",
"101 reads as follows: Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title. Claims 13 and 14 are rejected under 35 U.S.C. 101 because the claimed invention is directed to non-statutory subject matter. The claim(s) does/do not fall within at least one of the four categories of patent eligible subject matter because each of claims 13 and 14 are directed to a program. In accordance with MPEP § 2106.03(I), a computer program per se is expressly defined as a product that does not have a physical or tangible form and therefore not one of the four statutory categories. Neither claim 13 nor 14 recite any physical or tangible medium by which to store or actualize the program. Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C.",
"103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains.",
"Patentability shall not be negated by the manner in which the invention was made. The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. Claims 1-4, 7-10, 13, and 14 is/are rejected under 35 U.S.C.",
"103 as being unpatentable over U.S. Publication No. 2018/0302619 A1 (hereinafter “Ikeda”) in view of U.S. Publication No. 2020/0236353 A1 (hereinafter “Zhang”). Regarding claim 1, Ikeda discloses an encoding device which encodes an input image (FIG. 1, encoding device 10 for encoding the input at A/C 11) comprising: a transformer (FIG. 1, orthogonal transform section 14) configured to calculate an orthogonal transform coefficient by performing an orthogonal transformation process on a residual image indicating a difference between the input image and a predicted image of the input image ([0049], ll.",
"1-3, “The orthogonal transform section 14 performs an orthogonal transform on the prediction error data input from the subtraction section 13;” [0048], ll. 4-7, “The subtraction section 13 calculates prediction error data, which is the difference between the image data input from the reordering buffer 12 and the predicted image data input from the mode selecting section 50”); a quantizer (FIG. 1, quantization section 15) configured to generate quantization coefficient by quantizing the orthogonal transform coefficient based on a quantization parameter ([0050], ll. 4-5, “The quantization section 15 quantizes the transform coefficient data, and outputs the quantized transform coefficient data;” [0050], ll. 8-9, “the quantization section 15 switches a quantization parameter (a quantization scale)”); an entropy encoder (FIG. 1, lossless encoding section 16) configured to generate encoded data by encoding the quantization coefficient ([0052], ll. 1-3, “The lossless encoding section 16 generates an encoded stream by performing a lossless encoding process on the quantized data”); an image decoder (FIG. 1, dequantization section 21, inverse orthogonal transform section 22, and adding section 23) configured to restore an orthogonal transform coefficient from the quantization coefficient based on the quantization parameter ([0055], ll.",
"1-3, “The dequantization section 21 performs an dequantization process on the quantized data input from the quantization section 15:” e.g., the inverse of the quantization section 15, rescaling the data with the QP) and generate a pre-filtering image by adding the predicted image to a residual image restored by performing inverse orthogonal transformation on the orthogonal transform coefficient ([0056], ll. 1-4, “The inverse orthogonal transform section 22 performs an inverse orthogonal transform process on the transform coefficient data input from the dequantization section 21 to thereby restore the prediction error data;” [0057], ll. 1-4, “The addition section 23 adds the restored prediction error data input from the inverse orthogonal transform section 22 and the predicted image data input from the mode selecting section 50 to thereby generate decoded image data”); and a deblocking filter (FIG. 1, deblocking filter 24a) configured to perform a filtering process on the pre-filtering image ([0058], ll.",
"3-6, “the deblocking filter 24a determines the need for filtering on a per-line basis for each block boundary in the decoded image data input from the addition section 23”), wherein the deblocking filter (FIG. 1, deblocking filter 24a) is configured to control a filtering strength depending on a result of comparison between a luminance signal level of the pre-filtering image and a luminance threshold value ([0095], ll. 1-7, “If a boundary is determined to need the application of the deblocking filter, a filtering process is performed on pixels to the left and right of a vertical boundary, or on pixels above and , and the deblocking filter (FIG. 1, deblocking filter 24a) is configured to determine the luminance threshold value ([0097-0099 depict the three conditions for selecting between filter strength using a threshold value that has been determined) Ikeda fails to expressly disclose determine the luminance threshold value for each picture or each sequence. However, Zhang teaches determine the luminance threshold value for each picture or each sequence ([0038], ll. 8-12, “the de-blocking filter can be specifically determined for each picture, slice, coding tree unit (CTU) or CU. The parameters may correspond to the values of threshold (e.g.",
"Beta0, Beta1 and Beta2), clipping boundaries (e.g. TcS, Tc0, Tc1, and TcC) or both.” Additionally, [0039] describes signaling the Bs/Tc values at the picture or sequence level). Before the effective filing date of the claimed invention, it would have been obvious to a person having ordinary skill in the art to have determined de-blocking filters for each picture at picture level, as taught by Zhang ([0038]), in Ikeda’s invention. One would have been motivated to modify Ikeda’s invention, by incorporating Zhang’s invention, to adapt the deb-blocking filter to the underlying picture or a part of the picture for improved performance ([0016]).",
"Regarding claim 2, Ikeda and Zhang disclose all of the limitations of claim 1, as outlined above. Additionally, Zhang discloses wherein the deblocking filter is configured to determine the luminance threshold value for each sequence, and the entropy encoder is configured to transmit information indicated the luminance threshold value as a sequence parameter set to a decoding side ([0038], ll. 8-12, “the de-blocking filter can be specifically determined for each picture, slice, coding tree unit (CTU) or CU. The parameters may correspond to the values of threshold (e.g. Beta0, Beta1 and Beta2), clipping boundaries (e.g.",
"TcS, Tc0, Tc1, and TcC) or both;” [0039], ll. 13-17, “The parameters of thresholds and clipping boundaries can be signalled in a selected syntax level, such as the video parameter set (VPS), sequence parameter set (SPS), picture parameter set (PPS), slice header (SH), coding tree unit (CTU) or CU (Coding Unit)”). The same motivation of claim 1 applies to claim 2. Regarding claim 3, Ikeda and Zhang disclose all of the limitations of claim 1, as outlined above. Additionally, Ikeda discloses wherein the deblocking filter is configured to: specify which of a plurality of luminance signal level ranges defined by the luminance threshold value covers the luminance signal level of the pre-filtering image ([0097-0099] describe the filter selection based on thresholding and luma pixel values.",
"Note, the comparison to the threshold defines a luma range below the threshold and a luma range above the thresold); and control the filtering strength by using filtering strength control information corresponding to the specified luminance signal level range ([0097-99] defines the filter strength selection and [0100-0101] define the filter strength calculation). Regarding claim 4, Ikeda and Zhang disclose all of the limitations of claim 3, as outlined above. Additionally, Zhang discloses wherein the entropy encoder is configured to transmit filtering strength control information provided for each of the plurality of luminance signal level ranges as a sequence parameter set to a decoding side ([0038], ll. 8-12, “the de-blocking filter can be specifically determined for each picture, slice, coding tree unit (CTU) or CU. The parameters may correspond to the values of threshold (e.g. Beta0, Beta1 and Beta2), clipping boundaries (e.g. TcS, Tc0, Tc1, and TcC) or both;” [0039], ll. 13-17, “The parameters of thresholds and clipping boundaries can be signalled in a selected syntax level, such as the video parameter set (VPS), sequence parameter set (SPS), picture parameter set (PPS), slice header (SH), coding tree unit (CTU) or CU (Coding Unit);” [0015], ll.",
"4-10, “The B_Table corresponds to the threshold values and is signalled in the video bitstream for various QP (quantization parameters). The T_Table corresponds to the clipping boundaries and is signalled in the video bitstream for various QP and BS values. The thresholds and clipping boundaries are used in determining the parameters for filter decisions”). The same rationale of claim 1 applies to claim 4.",
"Regarding claim 7, the limitations are the same as those in claim 1; however, written from the decoder perspective. Ikeda describes the decoder in FIG. 2 as the inverse process of the encoder depicted in FIG. 1. Therefore, the same rationale of claim 1 applies to claim 7. Regarding claim 8, the limitations are the same as those in claim 2 Regarding claim 9, the limitations are the same as those in claim 3; however, written from the decoder perspective. Therefore, the same rationale of claim 3 applies to claim 9. Regarding claim 10, the limitations are the same as those in claim 4; however, written from the decoder perspective. Therefore, the same rationale of claim 4 applies to claim 10. Regarding claim 13, the limitations are the same as those in claim 1. Therefore, the same rationale of claim 1 applies to claim 13.",
"Additionally, Ikeda discloses a program ([0028], “The memory stores a program”). Regarding claim 14, the limitations are the same as those in claim 7. Therefore, the same rationale of claim 7 applies to claim 14. Additionally, Ikeda discloses a program ([0028], “The memory stores a program”). Claims 6 and 12 is/are rejected under 35 U.S.C. 103 as being unpatentable over U.S. Publication No. 2018/0302619 A1 (hereinafter “Ikeda”) in view of U.S.",
"Publication No. 2020/0236353 A1 (hereinafter “Zhang”), and further in view of U.S. Publication No. 2018/0139461 A1 (hereinafter “Liu”). Regarding claim 6, Ikeda and Zhang disclose all of the limitations of claim 1, as outlined above. Additionally, Zhang discloses wherein the entropy encoder is configured to transmit to a decoding side a flag indicating whether filtering strength control ([0044], ll. 1-4, “The parameters of thresholds and clipping boundaries can be signalled by any known coding method, such as fixed length coding or VLC (variable length Ikeda and Zhang fail to expressly disclose a flag indicating whether filtering strength control depending on the luminance signal level of the pre-filtering image is enabled or not. However, Liu teaches a flag indicating whether filtering strength control depending on the luminance signal level of the pre-filtering image is enabled or not ([0025], “picture-level deblocking-filter-disable flag.” Note, disabling the deblocking filter would disable the use of the filtering strength control, as there is no deblocking process).",
"Before the effective filing date of the claimed invention, it would have been obvious to a person having ordinary skill in the art to have a deblocking filter enablement flag, as taught by Liu ([0025]), in Ikeda and Zhang’s invention. One would have been motivated to modify Ikeda and Zhang’s invention, by incorporating Liu’s invention, to reduce the average bandwidth required for predicting ([0005] and [0013]). Regarding claim 12, the limitations are the same as those in claim 6; however, written from the decoder perspective. Therefore, the same rationale of claim 6 applies to claim 12. Allowable Subject Matter Claims 5 and 11 are objected to as being dependent upon a rejected base claim, but would be allowable if rewritten in independent form including all of the limitations of the base claim and any intervening claims. Conclusion Any inquiry concerning this communication or earlier communications from the examiner should be directed to STUART D BENNETT whose telephone number is (571)272-0677.",
"The examiner can normally be reached Monday - Friday from 9:00 AM - 5PM EST. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, William Vaughn can be reached on 571-272-3922. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of published or unpublished applications may be obtained from Patent Center.",
"Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format. For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.",
"/STUART D BENNETT/Examiner, Art Unit 2481"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-02-20.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Per Curiam. The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of Iowa for further consideration in light of Long v. District Court of Iowa in and for Lee County, ante, p. 192. | 11-27-2022 | [
"Per Curiam. The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of Iowa for further consideration in light of Long v. District Court of Iowa in and for Lee County, ante, p. 192."
] | https://www.courtlistener.com/api/rest/v3/opinions/8956599/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Justice GORSUCH took no part in the consideration or decision of this petition. | 11-28-2022 | [
"Justice GORSUCH took no part in the consideration or decision of this petition."
] | https://www.courtlistener.com/api/rest/v3/opinions/9225845/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
C. A. 9th Cir. [Certiorari granted, 564 U. S. 1066.] Motion of respondents for divided argument granted. | 11-28-2022 | [
"C. A. 9th Cir. [Certiorari granted, 564 U. S. 1066.] Motion of respondents for divided argument granted."
] | https://www.courtlistener.com/api/rest/v3/opinions/9239756/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Citation Nr: 1647735
Decision Date: 12/22/16 Archive Date: 01/06/17
DOCKET NO. 13-32 315 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office in Atlanta, Georgia
THE ISSUES
1. Entitlement to an initial evaluation higher than 30 percent for coronary artery disease.
2. Entitlement to service connection for sleep apnea, including due to asbestos exposure.
3. Entitlement to service connection for squamous cell carcinoma (claimed as skin cancer), including due to herbicide exposure.
REPRESENTATION
Appellant represented by: The American Legion
ATTORNEY FOR THE BOARD
Jason A. Lyons, Counsel
INTRODUCTION
The Veteran served on active duty in the U.S. Army from August 1950 to August 1970.
This appeal comes before the Board of Veterans' Appeals (Board) from rating decisions of the Department of Veterans Affairs (VA) Regional Office (RO) in Atlanta, Georgia.
Recently, a June 2016 RO rating decision denied entitlement to a total disability rating based on individual unemployability (TDIU) based on the Veteran's service-connected PTSD and coronary artery disease. Given that the Veteran has not filed timely Notice of Disagreement (NOD) and the TDIU is not claimed as solely due to his coronary artery disease, the Board finds that this issue has been properly bifurcated from the claim for an increased rating for coronary artery disease, and the Board will not take appellate jurisdiction at this time. Rice v. Shinseki, 22 Vet. App. 447 (2009).
This appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2016). 38 U.S.C.A. § 7107(a)(2) (West 2014).
The appeal is REMANDED to the Agency of Original Jurisdiction (AOJ). VA will notify the Veteran if further action is required.
REMAND
Pursuant to VA's duty to assist, the Veteran requires additional examination. For service-connected coronary artery disease July 2014 examination strongly implicated a heart arrhythmia, unconfirmed. Other medical record of arrhythmia was not found. If manifested, arrthymia is rated under separate rating criteria per the rating schedule, see 38 C.F.R. § 4.104 (2016). Accordingly, examination to determine if the Veteran has an arrhythmia and if it is related to his coronary artery disease, needs to be conducted.
With regard to the claim for sleep apnea, diagnosed in 2002, the Veteran avers it is related to asbestos exposure in service, and development of this theory has not been satisfied. Additionally, the Veteran sustained a gunshot wound to the forehead/neck in a hunting accident during service, and additional development as to whether this incident has any impact on the onset of sleep apnea needs to be developed.
For the claim regarding skin cancer, the Veteran alleges causation by herbicide exposure. He has presumed Agent Orange exposure based on service in Vietnam. See 38 U.S.C.A. § 1116 (West 2014); 38 C.F.R. § 3.307(a)(6)(iii) (2016). The remaining question is causation. The VA regulations do not list skin cancer as amongst those conditions for which presumptive service connection is available under 38 C.F.R. § 3.309(e). An examination on remand will however, resolve issue of direct causation of skin cancer. See Combee v. Brown, 34 F.3d 1039, 1043-44 (Fed. Cir. 1994).
The Veteran has identified relevant private medical records, from a sleep apnea specialist, Dr. S.T., dated from 2010 to 2016. These should be obtained, along with further VA records.
Accordingly, the case is REMANDED for the following action:
(Please note, this appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c). Expedited handling is requested.)
1. Obtain the Veteran's recent VA outpatient treatment records and associate them with the Veterans Benefits Management System (VBMS) electronic file.
2. Request that the Veteran identify and provide medical authorization (completed VA Form 21-4142) for further relevant private treatment records, including available from a Dr. Tomus, dated from 2010 to 2016. Obtain further records based on the information provided. If any of the requested records are unavailable, clearly document the fact and notify the Veteran of inability to obtain them, in accordance with 38 C.F.R. § 3.159(e).
3. Afford opportunity for the Veteran to describe asbestos exposure during service. Conduct follow-up development for objective confirmation. Prepare a memorandum to the file as to the likelihood of asbestos exposure.
4. Schedule the Veteran for VA examination to determine the current severity of his coronary artery disease. The VBMS claims folder must be provided to and reviewed by the examiner in conjunction with the examination. All indicated tests and studies should be performed, and all findings should be set forth in detail.
It is requested that the VA examiner indicate all present symptoms and manifestations attributable to the Veteran's service-connected coronary artery disease, in accordance with the rating criteria specified at 38 C.F.R. § 4.104, Diagnostic Code 7005.
Determine if the Veteran has an arrthymia associated with his cardiovascular disability; and if so, determine to what extent in accordance with applicable rating criteria.
5. Schedule another examination for with an appropriate sleep specialist. The VBMS claims folder must be provided to and reviewed by the examiner in conjunction with the examination. All indicated tests and studies should be performed, and all findings should be set forth in detail.
The examiner should determine whether the Veteran's sleep apnea is at least as likely as not (50 percent or greater probability) due to active military service, to include any possible asbestos exposure; and/or the accidental gunshot wound while hunting during service.
The examiner should include in the examination report the rationale for any opinion expressed. However, if the examiner cannot respond to the inquiry without resort to speculation, he or she should so state, and further explain why it is not feasible to provide a medical opinion.
6. Schedule dermatological examination. The VBMS claims folder must be provided to and reviewed by the examiner in conjunction with the examination. All indicated tests and studies should be performed, and all findings should be set forth in detail.
The examiner should determine whether the Veteran's squamous cell carcinoma is at least as likely as not (50 percent or greater probability) due to active military service, based on presumed Agent Orange exposure from his Vietnam service.
The examiner should include in the examination report the rationale for any opinion expressed. However, if the examiner cannot respond to the inquiry without resort to speculation, he or she should so state, and further explain why it is not feasible to provide a medical opinion.
7. Review the claims file. If any of the directives specified in this remand have not been implemented, take proper corrective action. Stegall v. West, 11 Vet. App. 268 (1998).
8. Then readjudicate the claims on appeal based upon all additional evidence received. If any benefit sought on appeal is not granted, the Veteran should be furnished with a Supplemental Statement of the Case (SSOC) and afforded an opportunity to respond before the file is returned to the Board for further appellate consideration.
The Veteran has the right to submit additional evidence and argument on the matters the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999).
These claims must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board of Veterans' Appeals or by the United States Court of Appeals for Veterans Claims for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A. §§ 5109B, 7112 (West 2014).
_________________________________________________
GAYLE E. STROMMEN
Veterans Law Judge, Board of Veterans' Appeals
Under 38 U.S.C.A. § 7252 (West 2014), only a decision of the Board of Veterans' Appeals is appealable to the United States Court of Appeals for Veterans Claims. This remand is in the nature of a preliminary order and does not constitute a decision of the Board on the merits of your appeal. 38 C.F.R. § 20.1100(b) (2016). | 12-22-2016 | [
"Citation Nr: 1647735 Decision Date: 12/22/16 Archive Date: 01/06/17 DOCKET NO. 13-32 315 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Atlanta, Georgia THE ISSUES 1. Entitlement to an initial evaluation higher than 30 percent for coronary artery disease. 2. Entitlement to service connection for sleep apnea, including due to asbestos exposure. 3. Entitlement to service connection for squamous cell carcinoma (claimed as skin cancer), including due to herbicide exposure. REPRESENTATION Appellant represented by: The American Legion ATTORNEY FOR THE BOARD Jason A. Lyons, Counsel INTRODUCTION The Veteran served on active duty in the U.S. Army from August 1950 to August 1970. This appeal comes before the Board of Veterans' Appeals (Board) from rating decisions of the Department of Veterans Affairs (VA) Regional Office (RO) in Atlanta, Georgia. Recently, a June 2016 RO rating decision denied entitlement to a total disability rating based on individual unemployability (TDIU) based on the Veteran's service-connected PTSD and coronary artery disease. Given that the Veteran has not filed timely Notice of Disagreement (NOD) and the TDIU is not claimed as solely due to his coronary artery disease, the Board finds that this issue has been properly bifurcated from the claim for an increased rating for coronary artery disease, and the Board will not take appellate jurisdiction at this time.",
"Rice v. Shinseki, 22 Vet. App. 447 (2009). This appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2016). 38 U.S.C.A. § 7107(a)(2) (West 2014). The appeal is REMANDED to the Agency of Original Jurisdiction (AOJ). VA will notify the Veteran if further action is required. REMAND Pursuant to VA's duty to assist, the Veteran requires additional examination. For service-connected coronary artery disease July 2014 examination strongly implicated a heart arrhythmia, unconfirmed. Other medical record of arrhythmia was not found. If manifested, arrthymia is rated under separate rating criteria per the rating schedule, see 38 C.F.R. § 4.104 (2016).",
"Accordingly, examination to determine if the Veteran has an arrhythmia and if it is related to his coronary artery disease, needs to be conducted. With regard to the claim for sleep apnea, diagnosed in 2002, the Veteran avers it is related to asbestos exposure in service, and development of this theory has not been satisfied. Additionally, the Veteran sustained a gunshot wound to the forehead/neck in a hunting accident during service, and additional development as to whether this incident has any impact on the onset of sleep apnea needs to be developed. For the claim regarding skin cancer, the Veteran alleges causation by herbicide exposure. He has presumed Agent Orange exposure based on service in Vietnam. See 38 U.S.C.A. § 1116 (West 2014); 38 C.F.R.",
"§ 3.307(a)(6)(iii) (2016). The remaining question is causation. The VA regulations do not list skin cancer as amongst those conditions for which presumptive service connection is available under 38 C.F.R. § 3.309(e). An examination on remand will however, resolve issue of direct causation of skin cancer. See Combee v. Brown, 34 F.3d 1039, 1043-44 (Fed. Cir. 1994). The Veteran has identified relevant private medical records, from a sleep apnea specialist, Dr. S.T., dated from 2010 to 2016. These should be obtained, along with further VA records.",
"Accordingly, the case is REMANDED for the following action: (Please note, this appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c). Expedited handling is requested.) 1. Obtain the Veteran's recent VA outpatient treatment records and associate them with the Veterans Benefits Management System (VBMS) electronic file. 2. Request that the Veteran identify and provide medical authorization (completed VA Form 21-4142) for further relevant private treatment records, including available from a Dr. Tomus, dated from 2010 to 2016. Obtain further records based on the information provided. If any of the requested records are unavailable, clearly document the fact and notify the Veteran of inability to obtain them, in accordance with 38 C.F.R.",
"§ 3.159(e). 3. Afford opportunity for the Veteran to describe asbestos exposure during service. Conduct follow-up development for objective confirmation. Prepare a memorandum to the file as to the likelihood of asbestos exposure. 4. Schedule the Veteran for VA examination to determine the current severity of his coronary artery disease. The VBMS claims folder must be provided to and reviewed by the examiner in conjunction with the examination. All indicated tests and studies should be performed, and all findings should be set forth in detail. It is requested that the VA examiner indicate all present symptoms and manifestations attributable to the Veteran's service-connected coronary artery disease, in accordance with the rating criteria specified at 38 C.F.R. § 4.104, Diagnostic Code 7005. Determine if the Veteran has an arrthymia associated with his cardiovascular disability; and if so, determine to what extent in accordance with applicable rating criteria. 5.",
"Schedule another examination for with an appropriate sleep specialist. The VBMS claims folder must be provided to and reviewed by the examiner in conjunction with the examination. All indicated tests and studies should be performed, and all findings should be set forth in detail. The examiner should determine whether the Veteran's sleep apnea is at least as likely as not (50 percent or greater probability) due to active military service, to include any possible asbestos exposure; and/or the accidental gunshot wound while hunting during service. The examiner should include in the examination report the rationale for any opinion expressed. However, if the examiner cannot respond to the inquiry without resort to speculation, he or she should so state, and further explain why it is not feasible to provide a medical opinion. 6. Schedule dermatological examination. The VBMS claims folder must be provided to and reviewed by the examiner in conjunction with the examination. All indicated tests and studies should be performed, and all findings should be set forth in detail.",
"The examiner should determine whether the Veteran's squamous cell carcinoma is at least as likely as not (50 percent or greater probability) due to active military service, based on presumed Agent Orange exposure from his Vietnam service. The examiner should include in the examination report the rationale for any opinion expressed. However, if the examiner cannot respond to the inquiry without resort to speculation, he or she should so state, and further explain why it is not feasible to provide a medical opinion.",
"7. Review the claims file. If any of the directives specified in this remand have not been implemented, take proper corrective action. Stegall v. West, 11 Vet. App. 268 (1998). 8. Then readjudicate the claims on appeal based upon all additional evidence received. If any benefit sought on appeal is not granted, the Veteran should be furnished with a Supplemental Statement of the Case (SSOC) and afforded an opportunity to respond before the file is returned to the Board for further appellate consideration.",
"The Veteran has the right to submit additional evidence and argument on the matters the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999). These claims must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board of Veterans' Appeals or by the United States Court of Appeals for Veterans Claims for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A.",
"§§ 5109B, 7112 (West 2014). _________________________________________________ GAYLE E. STROMMEN Veterans Law Judge, Board of Veterans' Appeals Under 38 U.S.C.A. § 7252 (West 2014), only a decision of the Board of Veterans' Appeals is appealable to the United States Court of Appeals for Veterans Claims. This remand is in the nature of a preliminary order and does not constitute a decision of the Board on the merits of your appeal. 38 C.F.R. § 20.1100(b) (2016)."
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
EXHIBIT 31.1CERTIFICATION PURSUANT TO RULE 13A-14(A) OF THE SECURITIES EXCHANGE ACT OF 1934AS ADOPTED PURSUANT TO SECTION -OXLEY ACT OF 2002I, John A. Conklin, certify that: 1.I have reviewed this annual report on Form 10-K of SolarWindow Technologies, Inc. (the “Registrant”);2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.As the registrant’s certifying officer I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 5.As the registrant’s certifying officer I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. Date: November21, 2016By:/s/ John A. ConklinJohn A. ConklinPresident, Chief Executive OfficerChief Financial Officer and Director | [
"EXHIBIT 31.1CERTIFICATION PURSUANT TO RULE 13A-14(A) OF THE SECURITIES EXCHANGE ACT OF 1934AS ADOPTED PURSUANT TO SECTION -OXLEY ACT OF 2002I, John A. Conklin, certify that: 1.I have reviewed this annual report on Form 10-K of SolarWindow Technologies, Inc. (the “Registrant”);2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.As the registrant’s certifying officer I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 5.As the registrant’s certifying officer I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.",
"Date: November21, 2016By:/s/ John A. ConklinJohn A. ConklinPresident, Chief Executive OfficerChief Financial Officer and Director"
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
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Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 1 of 4
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11 AUBREY LEE BROTHERS, II, Case No. 1:17-cv-00607-NONE-JDP 12 Plaintiff, FINDINGS AND RECOMMENDATIONS THAT COURT DENY DEFENDANT’S 13 v. MOTION FOR SUMMARY JUDGMENT FOR FAILURE TO EXHAUST 14 CHITA BUENAFE, et al., ADMINISTRATIVE REMEDIES 15 Respondent. OBJECTIONS DUE IN 14 DAYS 16 ECF No. 39 17
18 Plaintiff Aubrey Lee Brothers is a state prisoner proceeding without counsel in this civil 19 rights action brought under 42 U.S.C. § 1983. Brothers alleges that defendants—a dentist and 20 dental assistant working at California State Prison, Corcoran—violated his Eighth Amendment 21 rights by causing a skull fracture during a 2014 dental procedure and then refusing to treat the 22 injury and attendant pain. See ECF No. 28 at 4. On November 5, 2019, defendants moved for 23 summary judgment, arguing that plaintiff failed to his exhaust his administrative remedies. See 24 ECF No. 39.1 Brothers filed in opposition on February 3, 2020, ECF No. 49, and the defendant 25 replied on February 11, ECF No. 51.2 Because defendants have not satisfied their initial burden 26 1 As required by Rand v. Rowland, 154 F.3d 952, 962-63 (9th Cir. 1998), plaintiff was provided 27 with notice of the requirements for opposing a summary judgment motion via an attachment to defendant’s motion for summary judgment. See ECF No. 39. 28 2 Plaintiff also filed a supplemental response, and defendants filed a supplemental reply. See ECF 1 Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 2 of 4
1 of showing that plaintiff failed to exhaust his administrative remedies, we recommend that the
2 court deny defendants’ motion for summary judgment.
3 DISCUSSION
4 Summary judgment is appropriate when there is “no genuine dispute as to any material
5 fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). In a
6 summary judgment motion for failure to exhaust, the defendants have the initial burden of
7 establishing “that there was an available administrative remedy, and that the prisoner did not
8 exhaust that available remedy.” Albino v. Baca, 747 F.3d 1162, 1172 (9th Cir. 2014). If the
9 defendants carry that burden, “the burden shifts to the prisoner to come forward with evidence
10 showing that there is something in his particular case that made the existing and generally
11 available administrative remedies effectively unavailable to him.” Id. The ultimate burden of
12 persuasion remains with defendants, however. Id.
13 Here, the court finds that defendants have not satisfied their initial burden of showing that
14 plaintiff failed to exhaust his administrative remedies. In particular, health-care grievance
15 number 16051799 appears—construing the facts in favor of the non-moving party—to have
16 exhausted plaintiff’s administrative remedies. Indeed, the state’s final administrative response to
17 that grievance notes clearly that “[t]his decision exhausts your administrative remedies.” ECF
18 No. 39-4 at 102.
19 Defendants contend that this grievance “did not address the claims in this case” because it
20 “did not assert that Defendants refused to treat Brothers, nor did it mention anything about 21 Defendants after the dental procedure.” Id. We disagree: the grievance in question is connected
22 to the claims in this case. The grievance complained of pain that followed “a botched
23 ‘unrequested’ dental filing procedure” performed “by dental assistant Flores and Dr. Nguyen.”3
24 Nos. 52, 53. While defendants are correct that supplemental responses are typically not allowed 25 under our rules, in this instance it appears that plaintiff largely forgot to attach exhibits to his 26 original materials. However, while the court has read the supplement filings, we need not decide whether to accept them: the materials needed to decide this motion are all attached to defendants’ 27 original submission. 3 While defendants do not raise the issue, plaintiff appears to have included the wrong doctor’s 28 name in this grievance. But the fact that plaintiff did not name a specific defendant in his 2 Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 3 of 4
1 ECF No. 39-4 at 106. Plaintiff stated that he had “never had any old cranium fractures until this
2 moment,” id., and notes simply that, as a result of this treatment, “I am in pain,” id. at 105.
3 Indeed, the prison’s administrative response acknowledged forthrightly that plaintiff’s complaints
4 were “due to dental work completed in 2014.” Id. at 102.
5 The law of our circuit is that a “a grievance suffices if it alerts the prison to the nature of
6 the wrong for which redress is sought.” Griffin v. Arpaio, 557 F.3d 1117, 1120 (9th Cir. 2009).
7 Plaintiff’s grievance may have contained idiosyncrasies and misspellings, and may not have
8 contained the precise theory of liability. But it put the prison on notice of the general harm he is
9 alleged to have suffered—and it is the same harm at issue here. That was sufficient. After all, the
10 “primary purpose of a grievance is to alert the prison to a problem and facilitate its resolution, not
11 to lay groundwork for litigation.” Id. (9th Cir. 2009).
12 In addition, inmates “are not required to file and exhaust a separate grievance each time
13 they allegedly receive inadequate medical care for an ongoing condition.” Lewis v. Naku, No.
14 CIV S-07-0090-RRB-DAD, 2007 WL 3046013, at *5 (E.D. Cal. Oct. 18, 2007); see also Millner
15 v. DiLeo, No. 1:17-cv-00507-LJO-SAB, 2019 WL 316827, at *7 (E.D. Cal. Jan. 24, 2019)
16 (same). Plaintiff’s pain was ongoing, and the prison was on notice about the origin.
17 Because the court is persuaded that defendants have not carried their initial burden,
18 summary judgment for failure to exhaust is inappropriate.
19 FINDINGS AND RECOMMENDATIONS
20 We recommend that: 21 1. Defendants’ motion for summary judgment for failure to exhaust administrative
22 grievance, contrary to a procedural rule that he do so, does not contravene the exhaustion 23 requirement. The Ninth Circuit (and at least seven other circuits) have held that “the [Prison Litigation Reform Act (“PLRA”)] exhaustion requirement is satisfied if prison officials decide a 24 potentially procedurally flawed grievance on the merits.” Reyes v. Smith, 810 F.3d 654, 657 (9th Cir. 2016). This is so, the court reasoned, because “[w]hen prison officials opt not to enforce a 25 procedural rule but instead decide an inmate’s grievance on the merits, the purposes of the PLRA 26 exhaustion requirement have been fully served: prison officials have had a fair opportunity to correct any claimed deprivation and an administrative record supporting the prison's decision has 27 been developed.” Id. at 658. Here, as in Reyes, “defendants cannot argue that prison officials were unaware of the involvement of physicians” who were not named in the grievance. Id. at 28 659. 3 Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 4 of 4
1 remedies, ECF No. 39, should be denied.
2 2. The case should be referred back for further proceedings.
3 We submit the findings and recommendations to the district judge under 28 U.S.C.
4 § 636(b)(1)(B) and Rule 304 of the Local Rules of Practice for the United States District Court,
5 Eastern District of California. Within 14 days of the service of the findings and
6 recommendations, the parties may file written objections to the findings and recommendations
7 with the court and serve a copy on all parties. That document should be captioned “Objections to
8 Magistrate Judge’s Findings and Recommendations.” The district judge will review the findings
9 and recommendations under 28 U.S.C. § 636(b)(1)(C).
10 IT IS SO ORDERED. 11
12 Dated: September 29, 2020 13 UNITED STATES MAGISTRATE JUDGE 14
15 No. 205. 16
17
18
19
20 21
22
23
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26 27
28 4 | 2020-09-30 | [
"Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 1 of 4 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 AUBREY LEE BROTHERS, II, Case No. 1:17-cv-00607-NONE-JDP 12 Plaintiff, FINDINGS AND RECOMMENDATIONS THAT COURT DENY DEFENDANT’S 13 v. MOTION FOR SUMMARY JUDGMENT FOR FAILURE TO EXHAUST 14 CHITA BUENAFE, et al., ADMINISTRATIVE REMEDIES 15 Respondent. OBJECTIONS DUE IN 14 DAYS 16 ECF No. 39 17 18 Plaintiff Aubrey Lee Brothers is a state prisoner proceeding without counsel in this civil 19 rights action brought under 42 U.S.C. § 1983.",
"Brothers alleges that defendants—a dentist and 20 dental assistant working at California State Prison, Corcoran—violated his Eighth Amendment 21 rights by causing a skull fracture during a 2014 dental procedure and then refusing to treat the 22 injury and attendant pain. See ECF No. 28 at 4. On November 5, 2019, defendants moved for 23 summary judgment, arguing that plaintiff failed to his exhaust his administrative remedies. See 24 ECF No. 39.1 Brothers filed in opposition on February 3, 2020, ECF No. 49, and the defendant 25 replied on February 11, ECF No. 51.2 Because defendants have not satisfied their initial burden 26 1 As required by Rand v. Rowland, 154 F.3d 952, 962-63 (9th Cir.",
"1998), plaintiff was provided 27 with notice of the requirements for opposing a summary judgment motion via an attachment to defendant’s motion for summary judgment. See ECF No. 39. 28 2 Plaintiff also filed a supplemental response, and defendants filed a supplemental reply. See ECF 1 Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 2 of 4 1 of showing that plaintiff failed to exhaust his administrative remedies, we recommend that the 2 court deny defendants’ motion for summary judgment. 3 DISCUSSION 4 Summary judgment is appropriate when there is “no genuine dispute as to any material 5 fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ.",
"P. 56(a). In a 6 summary judgment motion for failure to exhaust, the defendants have the initial burden of 7 establishing “that there was an available administrative remedy, and that the prisoner did not 8 exhaust that available remedy.” Albino v. Baca, 747 F.3d 1162, 1172 (9th Cir. 2014). If the 9 defendants carry that burden, “the burden shifts to the prisoner to come forward with evidence 10 showing that there is something in his particular case that made the existing and generally 11 available administrative remedies effectively unavailable to him.” Id. The ultimate burden of 12 persuasion remains with defendants, however. Id. 13 Here, the court finds that defendants have not satisfied their initial burden of showing that 14 plaintiff failed to exhaust his administrative remedies.",
"In particular, health-care grievance 15 number 16051799 appears—construing the facts in favor of the non-moving party—to have 16 exhausted plaintiff’s administrative remedies. Indeed, the state’s final administrative response to 17 that grievance notes clearly that “[t]his decision exhausts your administrative remedies.” ECF 18 No. 39-4 at 102. 19 Defendants contend that this grievance “did not address the claims in this case” because it 20 “did not assert that Defendants refused to treat Brothers, nor did it mention anything about 21 Defendants after the dental procedure.” Id. We disagree: the grievance in question is connected 22 to the claims in this case.",
"The grievance complained of pain that followed “a botched 23 ‘unrequested’ dental filing procedure” performed “by dental assistant Flores and Dr. Nguyen.”3 24 Nos. 52, 53. While defendants are correct that supplemental responses are typically not allowed 25 under our rules, in this instance it appears that plaintiff largely forgot to attach exhibits to his 26 original materials. However, while the court has read the supplement filings, we need not decide whether to accept them: the materials needed to decide this motion are all attached to defendants’ 27 original submission. 3 While defendants do not raise the issue, plaintiff appears to have included the wrong doctor’s 28 name in this grievance. But the fact that plaintiff did not name a specific defendant in his 2 Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 3 of 4 1 ECF No. 39-4 at 106. Plaintiff stated that he had “never had any old cranium fractures until this 2 moment,” id., and notes simply that, as a result of this treatment, “I am in pain,” id. at 105. 3 Indeed, the prison’s administrative response acknowledged forthrightly that plaintiff’s complaints 4 were “due to dental work completed in 2014.” Id.",
"at 102. 5 The law of our circuit is that a “a grievance suffices if it alerts the prison to the nature of 6 the wrong for which redress is sought.” Griffin v. Arpaio, 557 F.3d 1117, 1120 (9th Cir. 2009). 7 Plaintiff’s grievance may have contained idiosyncrasies and misspellings, and may not have 8 contained the precise theory of liability. But it put the prison on notice of the general harm he is 9 alleged to have suffered—and it is the same harm at issue here.",
"That was sufficient. After all, the 10 “primary purpose of a grievance is to alert the prison to a problem and facilitate its resolution, not 11 to lay groundwork for litigation.” Id. (9th Cir. 2009). 12 In addition, inmates “are not required to file and exhaust a separate grievance each time 13 they allegedly receive inadequate medical care for an ongoing condition.” Lewis v. Naku, No. 14 CIV S-07-0090-RRB-DAD, 2007 WL 3046013, at *5 (E.D. Cal. Oct. 18, 2007); see also Millner 15 v. DiLeo, No. 1:17-cv-00507-LJO-SAB, 2019 WL 316827, at *7 (E.D. Cal. Jan. 24, 2019) 16 (same). Plaintiff’s pain was ongoing, and the prison was on notice about the origin.",
"17 Because the court is persuaded that defendants have not carried their initial burden, 18 summary judgment for failure to exhaust is inappropriate. 19 FINDINGS AND RECOMMENDATIONS 20 We recommend that: 21 1. Defendants’ motion for summary judgment for failure to exhaust administrative 22 grievance, contrary to a procedural rule that he do so, does not contravene the exhaustion 23 requirement. The Ninth Circuit (and at least seven other circuits) have held that “the [Prison Litigation Reform Act (“PLRA”)] exhaustion requirement is satisfied if prison officials decide a 24 potentially procedurally flawed grievance on the merits.” Reyes v. Smith, 810 F.3d 654, 657 (9th Cir. 2016). This is so, the court reasoned, because “[w]hen prison officials opt not to enforce a 25 procedural rule but instead decide an inmate’s grievance on the merits, the purposes of the PLRA 26 exhaustion requirement have been fully served: prison officials have had a fair opportunity to correct any claimed deprivation and an administrative record supporting the prison's decision has 27 been developed.” Id.",
"at 658. Here, as in Reyes, “defendants cannot argue that prison officials were unaware of the involvement of physicians” who were not named in the grievance. Id. at 28 659. 3 Case 1:17-cv-00607-NONE-JDP Document 62 Filed 09/30/20 Page 4 of 4 1 remedies, ECF No. 39, should be denied. 2 2. The case should be referred back for further proceedings. 3 We submit the findings and recommendations to the district judge under 28 U.S.C. 4 § 636(b)(1)(B) and Rule 304 of the Local Rules of Practice for the United States District Court, 5 Eastern District of California. Within 14 days of the service of the findings and 6 recommendations, the parties may file written objections to the findings and recommendations 7 with the court and serve a copy on all parties.",
"That document should be captioned “Objections to 8 Magistrate Judge’s Findings and Recommendations.” The district judge will review the findings 9 and recommendations under 28 U.S.C. § 636(b)(1)(C). 10 IT IS SO ORDERED. 11 12 Dated: September 29, 2020 13 UNITED STATES MAGISTRATE JUDGE 14 15 No. 205. 16 17 18 19 20 21 22 23 24 25 26 27 28 4"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/148090040/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claims status Claims 11-20 are pending and stand rejected. Claim Rejections - 35 USC § 102 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of the appropriate paragraphs of 35 U.S.C. 102 that form the basis for the rejections under this section made in this Office action: A person shall be entitled to a patent unless –
(a)(2) the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.
Claim(s) 11-14 and 16-20 is/are rejected under 35 U.S.C. 102(a)(2) as being anticipated by MUURINEN (US 2017/0149293 A1, hereinafter MUURINEN). As per claim 11, MUURINEN discloses a method for operating an inductive charging device, comprising: detecting, by the inducting charging device (See Fig.1, Item#100 and Fig.2, Item#220, disclose an inductive charging device), a foreign object detection (See Par.24 and Fig.3, disclose the inductive charging device performing a foreign object detection method), the detecting being carried out as a function of at least one characteristic power transmission variable (See Par.25-26, disclose the foreign object detection frequency is based on power loss in the wireless inductive charging system, i.e. carried out as a function of at least one characteristic power transmission variable, Par.27 discloses increasing the frequency of detection with the increased power loss or reducing the frequency when the power loss is less than a threshold, also that detection frequency can be based on the amount of power transmitted which is calculated based on feedback data from the receiver to the charger), wherein the inductive charging device includes an open-loop and/or closed- loop control unit (See Fig.1, Item#140, discloses a processor which executes the program code to perform the device functionality, also see Pars.33-34, discloser using a closed loop control method using feedback from the receiver to the charger to receive desired power level or actual received power, adjust the output according to the received data and also control the foreign object detection frequency according to the transmitted power. determining detection frequency as a function of power loss is another closed loop control since power loss is calculated by feedback of actual received power from the receiver to the transmitter and determining the difference between transmitted and receiver power) encompassed by a charge electronics unit, wherein the charge electronics unit has an oscillating circuit including a charging coil (See Fig.1, Item#110, 130, disclose circuitry for determining a foreign object detection frequency and a memory for storing the code which is executed by the processor and a transmitting coil 120, the circuit is an oscillating circuit as it provides an AC output via the transmitting coil 120).
As per claim 12, MUURINEN discloses the method as recited in claim 11 as discussed above, further comprising: determining at least one characteristic precision variable of the foreign object detection as a function of the at least one characteristic power transmission variable (See Par.25, discloses “FOD detection interval could be proportional to the power transmitted; it is possible to safely use a longer FOD interval i.e. lower FOD detection frequency when TX power is low and a shorter FOD interval i.e. higher FOD detection frequency when TX power is high”, also Par.26, discloses “FOD interval and thus FOD detection frequency may be further adapted based on power loss in the WLC system”).
As per claim 13, MUURINEN discloses the method as recited in claim 11 as discussed above, further comprising: determining at least one execution frequency of the foreign object detection as a function of the at least one characteristic power transmission variable (See Par.25 and Fig.4a, disclose increasing the detecting frequency as a function of increased power transmission).
As per claim 14, MUURINEN discloses the method as recited in claim 11 as discussed above, wherein the foreign object detection is carried out as a function of at least one change over time of an amplitude fluctuation and/or a gradient, of the characteristic power transmission variable (See Fig.4a, and 4b, curve#400 disclose the change in foreign object detection as a function of change of transmitted power over time).
As per claim 16, MUURINEN discloses the method as recited in claim 11 as discussed above, wherein the foreign object detection is carried out as a function of a value of the characteristic power transmission variable exceeding a limit value (See Par.27, discloses “The TX power may be split, for example, in four so that the first power level range, e.g. 0 W-1 W, has a FOD detection interval of 10 seconds, the second power level range, e.g.1 W-3 W, has a detection interval of 3 seconds, the third power level range, e.g. 3 W-5 W, has a detection interval of 1 seconds, and the last range, e.g. 5 W-10 W, of the TX power has a detection interval of 0.5 seconds” which means if the transmitted power exceeds a certain value; depending on the range it falls in, the correlated frequency of foreign object detection is determined.). As per claim 17, MUURINEN discloses the method as recited in claim [[1]] 11, further comprising: determining at least one execution period of time of the foreign object detection as a function of the at least one characteristic power transmission variable (See Fig.4a and 4b, disclose increasing the frequency of detection or decreasing the interval between detections, i.e. spending more time in foreign object detection based on the transmitted power).
As per claim 18, MUURINEN discloses an inductive charging device, comprising: at least one open-loop and/or closed-loop control unit configure to carry out a foreign object detection as a function of at least one characteristic power transmission variable (See Fig.1, Item#140, discloses a processor which executes the program code to perform the device functionality, also see Pars.33-34, discloser using a closed loop control method using feedback from the receiver to the charger to receive desired power level or actual received power, adjust the output according to the received data and also control the foreign object detection frequency according to the transmitted power. determining detection frequency as a function of power loss is another closed loop control since power loss is calculated by feedback of actual received power from the receiver to the transmitter and determining the difference between transmitted and receiver power, Fig.1, Item#100 and Fig.2, Item#220, disclose the inductive charging device), wherein the open-loop and/or closed-loop control unit is encompassed by a charge electronics unit, wherein the charge electronics unit has an oscillating circuit including a charging coil (See Fig.1, Item#110, 130, disclose circuitry for determining a foreign object detection frequency and a memory for storing the code which is executed by the processor and a transmitting coil 120, the circuit is an oscillating circuit as it provides an AC output via the transmitting coil 120).
As per claim 19, MUURINEN discloses he inductive charging device as recited in claim 18, wherein the open-loop and/or closed-loop control unit is configured to determine at least one characteristic precision variable of the foreign object detection as a function of at least one characteristic power transmission variable (See Par.25, discloses “FOD detection interval could be proportional to the power transmitted; it is possible to safely use a longer FOD interval i.e. lower FOD detection frequency when TX power is low and a shorter FOD interval i.e. higher FOD detection frequency when TX power is high”, also Par.26, discloses “FOD interval and thus FOD detection frequency may be further adapted based on power loss in the WLC system”.
As per claim 20, MUURINEN discloses the inductive charging device as recited in claim 18 as discussed above, wherein the open-loop and/or closed-loop control unit is configured to determine at least one execution frequency of the foreign object detection as a function of the at least one characteristic power transmission variable (See Par.25 and Fig.4a, 4b, disclose the frequency of foreign object detection and/or the interval between detections are adapted according to the power transmission amount). Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art. 2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to consider the applicability of 35 U.S.C. 102(b)(2)(C) for any potential 35 U.S.C. 102(a)(2) prior art against the later invention. Claim 15 is/are rejected under 35 U.S.C. 103 as being unpatentable over MUURINEN. As per claim 15, MUURINEN discloses the method as recited in claim 11 as discussed above, however MUURINEN does not disclose further comprising: suspending the foreign object detection as a function of a value of the characteristic power transmission variable undershooting a limit value. MUURINEN however discloses reducing the frequency of foreign object detection at low power and increasing the frequency of detection at higher power transmission and it would have been obvious to one of ordinary skill in the art before the effective filing date of the invention to suspend foreign object detection as a function of a value of the characteristic power transmission variable undershooting a limit value for the benefit of eliminating undesired power transmission interruption when the transmitted power is too low to cause damage to the charger or charge receiving device even in the presence of a foreign object (See Par.25). Conclusion Response to Amendment Applicant’s arguments with respect to claim(s) 11 and 18 have been considered but are moot because the new ground of rejection does not rely on any reference applied in the prior rejection of record for any teaching or matter specifically challenged in the argument. Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the date of this final action. Any inquiry concerning this communication or earlier communications from the examiner should be directed to AHMED H OMAR whose telephone number is (571)270-7165. The examiner can normally be reached 10:00 am -7:00 PM EST. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Drew Dunn can be reached on 571-272-2312. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.
/AHMED H OMAR/ Examiner, Art Unit 2859
/EDWARD TSO/ Primary Examiner, Art Unit 2859 | 2022-06-07T13:05:48 | [
"Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Claims status Claims 11-20 are pending and stand rejected. Claim Rejections - 35 USC § 102 In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status. The following is a quotation of the appropriate paragraphs of 35 U.S.C. 102 that form the basis for the rejections under this section made in this Office action: A person shall be entitled to a patent unless – (a)(2) the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.",
"Claim(s) 11-14 and 16-20 is/are rejected under 35 U.S.C. 102(a)(2) as being anticipated by MUURINEN (US 2017/0149293 A1, hereinafter MUURINEN). As per claim 11, MUURINEN discloses a method for operating an inductive charging device, comprising: detecting, by the inducting charging device (See Fig.1, Item#100 and Fig.2, Item#220, disclose an inductive charging device), a foreign object detection (See Par.24 and Fig.3, disclose the inductive charging device performing a foreign object detection method), the detecting being carried out as a function of at least one characteristic power transmission variable (See Par.25-26, disclose the foreign object detection frequency is based on power loss in the wireless inductive charging system, i.e. carried out as a function of at least one characteristic power transmission variable, Par.27 discloses increasing the frequency of detection with the increased power loss or reducing the frequency when the power loss is less than a threshold, also that detection frequency can be based on the amount of power transmitted which is calculated based on feedback data from the receiver to the charger), wherein the inductive charging device includes an open-loop and/or closed- loop control unit (See Fig.1, Item#140, discloses a processor which executes the program code to perform the device functionality, also see Pars.33-34, discloser using a closed loop control method using feedback from the receiver to the charger to receive desired power level or actual received power, adjust the output according to the received data and also control the foreign object detection frequency according to the transmitted power.",
"determining detection frequency as a function of power loss is another closed loop control since power loss is calculated by feedback of actual received power from the receiver to the transmitter and determining the difference between transmitted and receiver power) encompassed by a charge electronics unit, wherein the charge electronics unit has an oscillating circuit including a charging coil (See Fig.1, Item#110, 130, disclose circuitry for determining a foreign object detection frequency and a memory for storing the code which is executed by the processor and a transmitting coil 120, the circuit is an oscillating circuit as it provides an AC output via the transmitting coil 120).",
"As per claim 12, MUURINEN discloses the method as recited in claim 11 as discussed above, further comprising: determining at least one characteristic precision variable of the foreign object detection as a function of the at least one characteristic power transmission variable (See Par.25, discloses “FOD detection interval could be proportional to the power transmitted; it is possible to safely use a longer FOD interval i.e. lower FOD detection frequency when TX power is low and a shorter FOD interval i.e. higher FOD detection frequency when TX power is high”, also Par.26, discloses “FOD interval and thus FOD detection frequency may be further adapted based on power loss in the WLC system”). As per claim 13, MUURINEN discloses the method as recited in claim 11 as discussed above, further comprising: determining at least one execution frequency of the foreign object detection as a function of the at least one characteristic power transmission variable (See Par.25 and Fig.4a, disclose increasing the detecting frequency as a function of increased power transmission).",
"As per claim 14, MUURINEN discloses the method as recited in claim 11 as discussed above, wherein the foreign object detection is carried out as a function of at least one change over time of an amplitude fluctuation and/or a gradient, of the characteristic power transmission variable (See Fig.4a, and 4b, curve#400 disclose the change in foreign object detection as a function of change of transmitted power over time). As per claim 16, MUURINEN discloses the method as recited in claim 11 as discussed above, wherein the foreign object detection is carried out as a function of a value of the characteristic power transmission variable exceeding a limit value (See Par.27, discloses “The TX power may be split, for example, in four so that the first power level range, e.g. 0 W-1 W, has a FOD detection interval of 10 seconds, the second power level range, e.g.1 W-3 W, has a detection interval of 3 seconds, the third power level range, e.g.",
"3 W-5 W, has a detection interval of 1 seconds, and the last range, e.g. 5 W-10 W, of the TX power has a detection interval of 0.5 seconds” which means if the transmitted power exceeds a certain value; depending on the range it falls in, the correlated frequency of foreign object detection is determined.). As per claim 17, MUURINEN discloses the method as recited in claim [[1]] 11, further comprising: determining at least one execution period of time of the foreign object detection as a function of the at least one characteristic power transmission variable (See Fig.4a and 4b, disclose increasing the frequency of detection or decreasing the interval between detections, i.e. spending more time in foreign object detection based on the transmitted power). As per claim 18, MUURINEN discloses an inductive charging device, comprising: at least one open-loop and/or closed-loop control unit configure to carry out a foreign object detection as a function of at least one characteristic power transmission variable (See Fig.1, Item#140, discloses a processor which executes the program code to perform the device functionality, also see Pars.33-34, discloser using a closed loop control method using feedback from the receiver to the charger to receive desired power level or actual received power, adjust the output according to the received data and also control the foreign object detection frequency according to the transmitted power.",
"determining detection frequency as a function of power loss is another closed loop control since power loss is calculated by feedback of actual received power from the receiver to the transmitter and determining the difference between transmitted and receiver power, Fig.1, Item#100 and Fig.2, Item#220, disclose the inductive charging device), wherein the open-loop and/or closed-loop control unit is encompassed by a charge electronics unit, wherein the charge electronics unit has an oscillating circuit including a charging coil (See Fig.1, Item#110, 130, disclose circuitry for determining a foreign object detection frequency and a memory for storing the code which is executed by the processor and a transmitting coil 120, the circuit is an oscillating circuit as it provides an AC output via the transmitting coil 120). As per claim 19, MUURINEN discloses he inductive charging device as recited in claim 18, wherein the open-loop and/or closed-loop control unit is configured to determine at least one characteristic precision variable of the foreign object detection as a function of at least one characteristic power transmission variable (See Par.25, discloses “FOD detection interval could be proportional to the power transmitted; it is possible to safely use a longer FOD interval i.e. lower FOD detection frequency when TX power is low and a shorter FOD interval i.e.",
"higher FOD detection frequency when TX power is high”, also Par.26, discloses “FOD interval and thus FOD detection frequency may be further adapted based on power loss in the WLC system”. As per claim 20, MUURINEN discloses the inductive charging device as recited in claim 18 as discussed above, wherein the open-loop and/or closed-loop control unit is configured to determine at least one execution frequency of the foreign object detection as a function of the at least one characteristic power transmission variable (See Par.25 and Fig.4a, 4b, disclose the frequency of foreign object detection and/or the interval between detections are adapted according to the power transmission amount). Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C.",
"103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made. The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows: 1. Determining the scope and contents of the prior art.",
"2. Ascertaining the differences between the prior art and the claims at issue. 3. Resolving the level of ordinary skill in the pertinent art. 4. Considering objective evidence present in the application indicating obviousness or nonobviousness. This application currently names joint inventors. In considering patentability of the claims the examiner presumes that the subject matter of the various claims was commonly owned as of the effective filing date of the claimed invention(s) absent any evidence to the contrary. Applicant is advised of the obligation under 37 CFR 1.56 to point out the inventor and effective filing dates of each claim that was not commonly owned as of the effective filing date of the later invention in order for the examiner to consider the applicability of 35 U.S.C. 102(b)(2)(C) for any potential 35 U.S.C. 102(a)(2) prior art against the later invention. Claim 15 is/are rejected under 35 U.S.C. 103 as being unpatentable over MUURINEN.",
"As per claim 15, MUURINEN discloses the method as recited in claim 11 as discussed above, however MUURINEN does not disclose further comprising: suspending the foreign object detection as a function of a value of the characteristic power transmission variable undershooting a limit value. MUURINEN however discloses reducing the frequency of foreign object detection at low power and increasing the frequency of detection at higher power transmission and it would have been obvious to one of ordinary skill in the art before the effective filing date of the invention to suspend foreign object detection as a function of a value of the characteristic power transmission variable undershooting a limit value for the benefit of eliminating undesired power transmission interruption when the transmitted power is too low to cause damage to the charger or charge receiving device even in the presence of a foreign object (See Par.25). Conclusion Response to Amendment Applicant’s arguments with respect to claim(s) 11 and 18 have been considered but are moot because the new ground of rejection does not rely on any reference applied in the prior rejection of record for any teaching or matter specifically challenged in the argument.",
"Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a). A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any extension fee pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the date of this final action. Any inquiry concerning this communication or earlier communications from the examiner should be directed to AHMED H OMAR whose telephone number is (571)270-7165.",
"The examiner can normally be reached 10:00 am -7:00 PM EST. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Drew Dunn can be reached on 571-272-2312. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. /AHMED H OMAR/ Examiner, Art Unit 2859 /EDWARD TSO/ Primary Examiner, Art Unit 2859"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-06-12.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
252 P.3d 341 (2011) 242 Or. App. 9 CITY OF BEND, Plaintiff-Appellant Cross-Respondent, v. JUNIPER UTILITY COMPANY, an Oregon corporation; J.L. Ward Company, an Oregon corporation; and Jan L. Ward, Defendants-Respondents Cross-Appellants, and Juniper Water Company, an Oregon nonprofit corporation; Homeowners of Tillicum Village, an Oregon nonprofit corporation; Homeowners of Nottingham Square Association, an Oregon nonprofit corporation; Timber Ridge Homeowners Association, an Oregon nonprofit corporation; Frederick W. Rusch, II; Paul B. Brewer and Donna M. Brewer, Trustees of Brewer Family Trust; Richard R. Reynolds and Joann J. Reynolds, Trustees of Reynolds 1991 Revocable *342 Living Trust; Alfred J. Caputo; Gordon Westergard and Sharon K. Westergard, dba The Pines Mobile Home Park; Jo Ann L. Gamette, Trustee of the Jo Ann L. Gamette Living Trust; Dennis Beltrame, trustee; Margaret Beltrame, trustee; Larry Beser, dba Quail Ridge Mobile Home Park; Kim D. Ward, LLC, dba Crown Villa RV Park, an Oregon limited liability company; Ward Investment Properties, Inc., an Oregon corporation; Kim D. Ward; Mountain High Homeowners Association, an Oregon nonprofit corporation; River Place MHC, a California limited partnership, Defendants. 02CV0202ST; A137087. Court of Appeals of Oregon. Argued and Submitted October 6, 2010. Decided April 6, 2011. *343 John W. Stephens, Portland, argued the cause for appellant-cross-respondent. With him on the briefs was Esler Stephens & Buckley. Gregory R. Mowe, Portland, argued the cause for respondents-cross-appellants. With him on the briefs were William F. Buchanan, Brad S. Daniels, and Stoel Rives LLP. On the reply brief was James N. Westwood. Before SCHUMAN, Presiding Judge, and WOLLHEIM, Judge, and ROSENBLUM, Judge. SCHUMAN, P.J. Nearly a decade ago, the City of Bend determined that a water and sewer utility, Juniper Utility Company, was not meeting the needs of its customers, so the city filed a condemnation action to take ownership of the utility for public use. The central question at trial was the proper method for determining the fair market value of the utility plant. The trial court applied what is known as the "cost approach" in determining that the fair market value of the plant was approximately $3.3 million. The city appeals, arguing that the court erred in applying the cost approach and that, under the proper testthe "income approach"the fair market value was actually far less, because the plant had virtually no potential to generate income and, for that reason, no buyer would pay anything for it. Juniper Utility Company and other defendants in the case (collectively "the Utility Defendants") cross-appeal, arguing that the award of just compensation was in fact too low, and that they were entitled to additional compensation for certain easements as well as further post-judgment interest. For the reasons that follow, we affirm the judgment with respect to the trial court's valuation of the utility plant, reverse with respect to the award of certain severance damages, and remand.
I. BACKGROUND We take the relevant facts from the trial court's explicit and implicit factual findings, which are supported by evidence in the record. ORCP 62 F ("In an action tried without a jury, * * * the findings of the court upon the facts shall have the same force and effect, and be equally conclusive, as the verdict of a jury.").[1] To the extent that the parties dispute the particulars or importance of various factual findings, we address those issues in greater detail in later sections of this opinion. In the 1960s, the Ward brothers began developing various properties in the Bend area. In 1972, two of the brothers, Jan and Kim, incorporated Juniper Utility Company to provide water and sewer services to support the family's development projects. Over the years, the Juniper Utility Company system[2] evolved into what is now a unique combination of water delivery facilities with a sewage disposal and treatment system. The water delivery facilities include a two-pipe system, one pipe that delivers potable water and another that provides irrigation water. The two-pipe system serves approximately 1,125 customers in southeastern Bend and supplies them with nonpotable irrigation water at an affordable price, thereby allowing them to keep their neighborhoods lush *344 throughout the summer. The sewage collection system, meanwhile, is pressurized by pump stations at customer residences; waste is pumped to a treatment plant for processing, and effluent from the plant is then pumped through pipes and disposed of on land owned by J.L. Ward Company, the successor to the various Ward businesses. Much of the dispute in this case stems from the fact that Juniper Utility Company was never intended to be an independent profit source for its owners. Rather, from its inception, the Wards viewed it as a project that would support their other profit-making development ventures. Once the utility company was incorporated, various Ward family entities and individuals transferred ownership of an existing treatment plant, water reservoir, and certain pump and well sites to Juniper Utility Company, as well as certain "blanket easements" i.e., easements to use their land for installation and maintenance of utilities, and to use and maintain certain "ponds." The utility company, meanwhile, agreed to provide water and sewer services to properties owned by the grantors "on a non-profit basis." In addition to those capital contributions known in utility terminology as "contributions in aid of construction"the Ward family and its entities also bore the initial cost of expanding the utility infrastructure. When a parcel of land was developed, J.L. Ward Company[3] would subdivide the land and then build the utility infrastructure in the common areas or, in some cases, on land dedicated to the public. Juniper Utility Company was then given an easement for its pipes and other facilities. As lots or homes were sold in the development, J.L. Ward Company recouped the cost of the infrastructure as part of the sales price. The utility entered into a series of operating agreements with homeowners associations (HOAs) and with Kim Ward (who developed mobile home and RV parks) that provided that rates would be set at a level necessary to operate and maintain the utilities but that "[n]o accumulations for profit shall be made."[4] For more than two decades, Juniper Utility Company set its own rates for water and wastewater services. In 1998, however, the Oregon Public Utility Commission (PUC) asserted regulatory authority over Juniper Utility Company and held ratemaking proceedings. See ORS 757.061 (describing water utilities subject to financial regulation). In 2000, the PUC entered an order determining "fair, just, and reasonable rates" for Juniper Utility Company's services; those rates were substantially lower than the rates that Juniper Utility Company had been charging its customers. The way in which Juniper Utility Company was created and operated had a significant effect on the rates set by the PUC. As a general matter, the ratemaking process is intended to provide utilities an opportunity to earn a fair and reasonable return on their investment. Property that the utility receives as a contribution in aid of construction "CIAC" for shortis not considered part of the utility's investment and is therefore given a value of zero for purposes of calculating the utility's rate base, which is the amount of investment on which a regulated public utility can earn a fair and reasonable return. In setting rates for Juniper Utility Company, the PUC determined that developer contributionsthat is, capital contributions from J.L. Ward Company and others to create and expand the utilitywere CIAC and would therefore not be considered in calculating a reasonable return on investment. As a result, the PUC determined that the total rate base for the utility was less than $100,000. The PUC authorized a 10 percent rate of return, the PUC's generic rate for water utilities, thereby allowing Juniper Utility Company to earn a return of less than $10,000 per year from its rate base. After its rates were set at that reduced level, J.L. Ward Company, which had paid for necessary maintenance of Juniper Utility *345 Company, stopped supporting the utility. Capital improvements and maintenance were deferred; service was curtailed and became inadequate in many respects. Customers responded with complaints about the utility to the PUC and to the City of Bend. Thereafter, the PUC and the city sought and obtained injunctive relief requiring Juniper Utility Company to provide adequate service. In September 2001, the Bend City Council adopted a resolution of necessity and intent to appropriate the Juniper system property. The city initiated this condemnation action in April 2002. See ORS 225.020(1)(a) (authorizing a city to bring an action for condemnation to "[a]cquire water systems and use, sell and dispose of its water for domestic, recreational, industrial, and public use and for irrigation and other purposes within and without its boundaries"). The city's condemnation complaint sought to take various Juniper system assets for public use, including pipes, valves, pumps, wells, headgates, hydrants, a wastewater treatment facility, sewer lift stations, and other infrastructure, as well as water rights, real property, and utility easements. During the course of the litigation, the most hotly contested issue was the method of valuation to be used to determine the fair market value that the city should be required to pay for the "utility plant"that is, "all pipes, valves, pumps, wells, treatment facilities and other infrastructure." As later discussed in greater detail, there are three commonly utilized methodologies for appraising the value of plants like the Juniper system: (1) the market approach, which looks at comparable sales data; (2) the income approach, which looks at the income-generating potential of the property; and (3) the cost approach, a valuation typically based on replacement or reproduction cost of the plant minus any depreciation. See generally Appraisal Institute, The Appraisal of Real Estate (12th ed. 2001). The parties agreed that the market approach was unhelpful in this case, because there were no comparable sales of plants like the Juniper system. The city therefore urged the court to apply the income approach, which would have valued the plant based on its potential to generate income to a willing buyer. Under that approach, the city contended, the plant had a fair market value of zero; thanks to the utility's rate base, which did not account for CIAC, the regulated plant was essentially worthless because it could generate only a negligible return. The Utility Defendants, meanwhile, argued that the plant's regulated income potential admittedly nothingfailed to capture the fair market value of the utility. The better approach, in their view, was the cost approach. That approach, according to the Utility Defendants, would account for the fact that CIAC, though not counted for purposes of ratemaking, nevertheless is valuable property that cannot be taken without just compensation. The trial court, in an extensive written opinion, agreed with the Utility Defendants that the cost approach provided the best indicator of the plant's fair market value. The court explained that it is "not a novel concept in eminent domain law * * * that the condemning authority must pay fair market value, regardless of how the condemnee came to own the taken property." Accordingly, the "intrinsic value" of the plant "does not disappear because of the decision by J.L. Ward Company to contribute the assets, rather than loan Juniper Utility Company the money to buy the assets. A taking of the Juniper Utility Company assets for no compensation [as the city proposed] would be little more than a confiscation." The court continued, "Nor does the difficulty in valuing a special use asset work to deprive it of value. Certainly, Juniper Utility Company is a unique, special purpose property. As a result, there is no ability to value it using the market approach as there are no comparable sales. The income approach fails to value the taken property at all. In this situation, it is black letter law that the cost approach may be considered." Although the court concluded that "[t]he cost approach is the only method of valuation appropriate in this case," it nevertheless declined to accept the Utility Defendants' appraisal "lock, stock and barrel." Rather, the court concluded that the starting point for *346 determining fair market value of the plant was "original cost new less depreciation," which, according to the court, would take into account the age and condition of the plant and the regulatory environment (including the fact that even an unregulated buyer would not pay more for the plant than the original cost of the plant less depreciation). In the end, the court found "the fair market value of the Juniper Utility Co. plant to be $3,297,859." The court separately valued water rights ($347,590), easements ($1,515,883), and real property taken in fee ($326,400). As relevant here, in valuing the easements, the court concluded that certain "blanket easements"those easements that had been granted to Juniper Utility Company to facilitate access to the utility infrastructure were typically granted to utility providers at no cost and should therefore not increase the compensation award.[5] The court also awarded the Utility Defendants damages for impairment to their remaining property that was caused by the condemnation of the utility. The court then entered a judgment of condemnation that included prejudgment but not post-judgment interest as part of the calculation of just compensation. The city appeals, and the Utility Defendants cross-appeal.[6]
II. ANALYSIS
A. The Law of Eminent Domain
A quick primer on the law of eminent domain is helpful to set the stage for the parties' various assignments of error. Under Article I, section 18, of the Oregon Constitution, "Private property shall not be taken for public use * * * without just compensation[.]" Private property is "taken" for public use through the exercise of the power of eminent domainthat is, "`the power inherent in a sovereign state of taking or of authorizing the taking of any property within its jurisdiction for a public use or benefit.'" Dept. of Trans. v. Lundberg, 312 Or. 568, 571 n. 1, 825 P.2d 641, cert. den., 506 U.S. 975, 113 S.Ct. 467, 121 L.Ed.2d 374 (1992) (quoting MacVeagh v. Multnomah County, 126 Or. 417, 431-32, 270 P. 502 (1928)). Governmental units with eminent domain authority, such as the City of Bend, can exercise that authority by instituting condemnation proceedings. See ORS chapter 35 (governing condemnation proceedings). If the condemner and the property owner cannot agree on "just compensation," the issue is tried to the jury or a court. See ORS 35.305(2) ("Condemner and defendant may offer evidence of just compensation, but neither party shall have the burden of proof of just compensation."). Under Oregon law, "just compensation" is determined based on the fair market value of the property that is being taken. Fair market value, in turn, is "defined as the amount of money the property would bring if it were offered for sale by one who desired, but was not obliged, to sell and was purchased by one who was willing, but not obliged, to buy." Lundberg, 312 Or. at 574, 825 P.2d 641. In other words, "just compensation" is the amount that a willing buyer would pay a willing seller for the condemned property.
B. The Appeal
The difficulty, of course, is how to figure out what a willing buyer would pay a willing seller for a public utility like the Juniper planta water and sewage system for which there is no established market.[7] That is the *347 primary issue on appeal, as it has been throughout this litigation: In the absence of comparable sales, what is the proper methodology for determining the fair market value of the Juniper system? The city argues that the method utilized by the trial court, the cost approach, was erroneous as a matter of law: "The trial court erred as a matter of law when it used the cost method to determine the fair market value (just compensation) of property that its owner(s) devoted to a public purpose and that was necessary or useful to provide water and wastewater utility service-particularly where the market value of that property was capable of being established by the income method." The parties, as an initial matter, disagree about the proper standard of review with respect to the trial court's use of the cost approach. The city argues that "[w]hat approach, method, or theory a court should properly use to determine the fair market value of property is a matter of law for the court, and the Court of Appeals reviews the trial court's decision for errors of law." The Utility Defendants, meanwhile, submit that the "trial court's choice of valuation methodology and most of the other decisions that the City challenges are questions of fact reviewed under the any evidence standard of review." Fair market value in condemnation cases is ultimately a question of fact. See Lundberg, 312 Or. at 574-75, 825 P.2d 641 ("The question of the highest and best use of particular property is not a question of constitutional magnitude or of law, but is a question of fact that relates to the question of value and is to be decided by a jury."); Selbee v. Multnomah County, 247 Or. 390, 394, 430 P.2d 561 (1967) ("In order to enable the jury to pass intelligently upon the question of whether the market value of the remaining land has been increased as a result of the improvement, we think that, at least in the generality of cases, there must be some evidence of that fact other than the improvement itself." (Emphasis added.)).[8] At the same time, courts have always served an important role in cabining the "just compensation" inquiry i.e., in applying limits on what a trier of fact can consider when determining fair market value. See, e.g., Santiam Lumber Co. v. Conhaim, 218 Or. 220, 224, 344 P.2d 247 (1959) ("We think that in a condemnation proceeding to acquire an easement for a logging road right of way, evidence of the quantity of timber that might be transported over the right of way is not a proper factor to be considered by the jury in determining the fair market value of the land being condemned."). Neither the Supreme Court nor this court has ever addressed exactly where valuation methodology falls on the continuum between questions of fact and questions of law in eminent domain cases. However, in tax casescases involving public utilities, no lessthe Supreme Court has repeatedly observed that, when determining fair market value, the choice among particular valuation methods is generally a fact-based inquiry rather than a question of law. See, e.g., United Telephone Co. v. Dept. of Rev., 307 Or. 428, 431, 770 P.2d 43 (1989) ("[W]hen this court evaluates and then either accepts or rejects various theories of valuation offered by the parties, it almost always does so as a finder of fact on de novo review of the record made in the Tax Court."); Pacific Power & Light Co. v. Dept. of Revenue, 286 Or. 529, 533, 596 P.2d 912 (1979) ("[W]hether in any given assessment one [valuation] approach should be used exclusive of the others or is preferable to another or to a combination of approaches is a question of fact to be determined by the court upon the record."); Brooks Resources Corp. v. Dept. of Revenue, 286 Or. 499, 503, 595 P.2d 1358 (1979) (reviewing as a fact question the choice among "three standard approaches to valuation: the market data approach, the income approach, and the cost approach"). *348 The court's discussion of valuation methodologies in Brooks Resources Corp. is particularly illuminating: "We have observed in previous cases of this kind that there are three standard approaches to valuation: the market data approach, the income approach, and the cost approach. Bend Millwork v. Dept. of Revenue, 285 Or. 577, 592 P.2d 986 (1979); Medical Building Land Company v. Dept. of Rev., 283 Or. 69, 582 P.2d 416 (1978); Swenson v. Dept. of Revenue, 276 Or. 1, 553 P.2d 351 (1976). The appropriateness of a particular valuation method or combination of methods is not determined by fixed principles of law, but is a factual determination that depends on the record developed in each case. See Medical Building Land Company v. Dept. of Rev., supra at 78-79 [582 P.2d 416]. Because we try this case `anew upon the record,' we must determine which of the above approaches to valuation, under the facts of this case, best reflects the `true cash value' of the property. In making this determination, we emphasize that we are performing our function as fact-finder, not our function as a corrector of legal errors." 286 Or. at 503-04, 595 P.2d 1358 (omitted). The tax context differs, of course, from condemnation in many ways, but the basic premise of Brooks Resources Corp. carries over to any context in which a factfinder is charged with determining fair market value, be it a conversion case, a tax case, or a condemnation case. That is, unless some fixed principle of the law demands otherwise, it is left to the trier of fact to assess the evidence, including expert testimony regarding the appropriateness of a particular valuation methodology, and to then make a factual call as to the fair market value of the property in question. Viewed through that prism, we understand the city's first assignment of error to present a rather narrow legal question: whether some fixed principle of eminent domain law prohibited the trial court from considering the cost approach as part of its factual determination of fair market value. If so, the trial court committed reversible error in relying on that evidence as it did; in the absence of such a fixed principle, however, we will not second-guess the trial court's decision to give weight to a particular valuation approach in finding a fair market value for the Juniper system.[9] The city offers several interrelated reasons as to why the cost approach was, as a matter of law, an impermissible valuation methodology in this case. The contentions, as we understand them, boil down to the following: (1) The cost approach is evidence of the maximum amount that a willing buyer might pay, not a measure of fair market value in itself; for that reason, Oregon courts have approved the use of the cost approach only as a ceiling when other valuation methods yield a higher fair market value. (2) The appropriate measure of fair market value for a public utility like the Juniper system is, as a matter of law, the income approach, not the cost approach. We are not persuaded by those contentions. The city's primary argument is that the cost approach, standing alone, never yields a fair market value for purposes of eminent domain. That is so, the city argues, because "[t]he cost approach, unlike the market approach *349 and the income approach, has no external reference to the market." According to the city, "[t]he cost approach is based on the principle of `substitution,' that a willing buyer would not pay more for a property than the cost of constructing a comparable facility." For that reason, the argument goes, "Oregon courts have consistently held that the cost approach is not an appropriate way to value property in an eminent domain action."[10] After canvassing the authority cited by the city, we are not persuaded that the cost approach serves such a limited role in assessing fair market value, particularly in a condemnation case like this. The underpinnings and application of the cost approach have long been the subject of scholarly debate. In his treatise on the appraisal of property, Professor Bonbright explains that the principle of substitution "merely justifies the inference that * * * property cannot be worth more than its replacement cost," but that "[i]t by no means warrants the further inference that the value is as high as this, or even that the value is nearer to replacement cost than it is to zero"a point that "the American courts have often failed to recognize[.]" James C. Bonbright, I Valuation of Property 159 (1st ed. 1937). "Nevertheless," Bonbright continues, "under certain circumstances an appraiser is warranted in accepting an estimate that the replacement cost of property, with proper allowance for incidental loss and for depreciation, as the best available measure of its value." Id. (emphasis added). One of those circumstances, he later explains, is in eminent domain cases: "Estimates of current replacement cost minus arbitrary deductions for depreciation must often be accepted in default of a better measure." Id. at 420-21. Modern authorities likewise have taken the view that the cost approach, in addition to establishing an upper limit to fair market value, can itself be an acceptable indicator of fair market value in some cases: "Buyers of these [special-purpose or specialty properties not frequently exchanged in the market] often measure the price they will pay for an existing building against the cost to build minus depreciation or the cost to purchase an existing structure and make any necessary modifications. If comparable sales are not available, they cannot be analyzed to develop an opinion of the market value of such properties. Therefore, current market indications of depreciated cost or the costs to acquire and refurbish an existing building are the best reflections of market thinking and, thus, of market value * * *." The Appraisal of Real Estate at 354; accord Delta Air Lines, Inc. v. Dept. of Rev., 328 Or. 596, 605, 984 P.2d 836 (1999) ("The cost approach to value is based upon the principle of substitution, that is, it assumes that property is worth its cost or the cost of a satisfactory substitute with equal utility." (Emphasis added.)).[11] Indeed, Oregon courts have specifically recognizedif not endorsedthe cost approach as an appropriate valuation methodology in condemnation cases involving special use property for which comparable sales data is unavailable. In Highway Comm. v. Superbilt Mfg. Co., 204 Or. 393, 419-20, 281 P.2d 707 (1955), the court, quoting a leading treatise on the subject of eminent domain, stated: "Peculiar circumstances warranting a resort to other considerations than the usual tests for determining market value are set forth in 4 Nichols, Eminent Domain 133, § 12.32, as follows:
*350 "`It occasionally happens that a parcel of real estate taken by eminent domain is of such a nature, or is held or has been improved in such a manner, that, while it serves a useful purpose to its owner, if he desired to dispose of it he would be unable to sell it at anything like its real value. A church, or a college building, or a club-house located in a town in which there was but one religious society, or college, or club, might be worth all it cost to its owners, but it would be absolutely unmarketable. * * *. Even such a piece of property as a mill site or a reservoir site, or a factory or store of abnormal size may, to a somewhat lesser degree, be difficult to dispose of, though of great value to its owner. "`In such a case as similar property is not commonly bought and sold it is impossible to ascertain market value by the usual tests. In fact, as market value presupposes a willing buyer, the conditions upon which such value is based are not present, and it is sometimes said that in cases of this character market value is not the measure of compensation. As it is conceded that the owner cannot on that account be deprived of his property without any compensation whatever, some other measure is sought. It must, however, be remembered that market value is always based upon hypothetical conditions, and that it is never necessary to show that there was in fact a person able and willing to buy. The measure is still what another religious society, or college, or club, or public service corporation, or abutting owner, would pay if there were one at hand; in other words, the measure is still market value. However, since the usual means of ascertaining market value are lacking, other means must from the necessity of the case be resorted to. It is, therefore, proper in such cases to deduce market value from the intrinsic value of the property, and its value to its owners for their special purposes. * * *.'" (Emphasis added.) The cost approach is one of the "other means" for deducing the fair market value of special use property in eminent domain cases. In Bd. of Higher Ed. v. 1st Meth., Ashland, 6 Or.App. 492, 494, 488 P.2d 835 (1971), we explained: "Market value is the recognized measure of compensation when land is taken by eminent domain. Highway Comm. v. Superbilt Mfg. Company, 204 Or. 393, 281 P.2d 707 (1955); 4 Nichols', Eminent Domain 41, § 12.2 (1962). Other criteria are recognized, though, in special circumstances. One is the `replacement facility' theory, described in 4 Nichols', § 12.32 at 227: "`Where a building is a specialty, and, in a sense, unique, being constructed for a special use, the valuation cannot be predicated on the same basis as a building constructed for general * * * use. * * * It has been held under such circumstances that reproduction cost or replacement cost may be considered * * *.'"[12] See also Julius L. Sackman, 4 Nichols on Eminent Domain, § 12C.01[3][b] (rev. 2001) (citing cases that have approved the use of the cost method for special use property); S.W. Moore, 8 Nichols on Eminent Domain § G14A.06 (rev. 2008) ("The three basic approaches to value are: (1) Market, (2) Cost, and (3) Income. All three may apply to public-utility valuation, with modifications."); cf. State Hwy. Comm. v. Demarest, 263 Or. 590, 607 n. 2, 503 P.2d 682 (1972) ("Often market value of trade fixtures, based on comparable sales, is difficult to determine in cases where the trade fixtures are being evaluated separately in condemnation cases. In such circumstances, other approaches, *351 such as reproduction or replacement costs less depreciation, are used." (Emphasis added.)). Accordingly, we are not persuaded by the city's contention that Oregon courts have categorically rejected the use of the cost approach by a trier of fact as part of the ultimate determination of fair market value. The question whether the trier of fact may permissibly consider that approach in determining fair market value has been determined by Oregon courts on the facts of each case, as it has been in other jurisdictions. See, e.g., Dade County v. General Waterworks Corp., 267 So.2d 633, 641 (Fla.1972) (describing use of "reproduction cost method" in valuing utilities for condemnation purposes); The Appraisal of Real Estate at 354 ("The cost approach is also used to develop an opinion of market value * * * [of] special-purpose or specialty properties, and other properties that are not frequently exchanged in the market."); accord Appeal of Pennichuck Water Works, Inc., 160 N.H. 18, 38, 992 A.2d 740, 757 (N.H.2010) ("The trier of fact may use any one or a combination of five appraisal techniques in valuing public utility property: original cost less depreciation (rate base or net book), comparable sales, cost of alternate facilities, capitalized earnings, and reproduction cost less depreciation. * * * We have * * * never attempted to tie the fact finder's hands with a rigid fair market value formula in the absence of legislative directive." (Internal citations and quotation marks omitted.)).[13] The city offers a fallback argument in the event this court disagrees, as we do, with its categorical rejection of the cost approach. The city seizes on language in Superbilt Mfg. Co. in which the court held, "[I]nasmuch as the property being appropriated had a market value that could be determined by the usual tests, it was error to admit evidence respecting reproduction costs * * *." 204 Or. at 426, 281 P.2d 707. From that holding, the city posits that resort to the cost approach was likewise legal error in this case because the market value of the Juniper system was capable of being established by the income approach. That argument has two premises: (1) that "the usual tests" include the income approach; and (2) that the fair market value of the Juniper system was capable of being established by the income approach. Neither premise is correct. The reference to "the usual tests" for valuation in Superbilt Mfg. Co. is to the type of measures of value that are possible for property that is regularly bought and soldin other words, the market approach. The opinion earlier discusses "the usual tests" in that context: "`In such a case as similar property is not commonly bought and sold it is impossible to ascertain market value by the usual tests.'" Id. at 419, 281 P.2d 707 (quoting 4 Nichols on Eminent Domain 133, § 12.32). And, on the facts in Superbilt Mfg. Co., that was indeed the casethe property at issue was an empty warehouse, and the court observed that "[t]here is no question that empty warehouse buildings of the type and construction of the building involved in this litigation have a market value in the city of Portland and vicinity, and that such market value may easily be established in the usual manner." Id. at 427, 281 P.2d 707. Thus, we are not persuaded that the income approach, at least in the context of a regulated utility, is one of "the usual tests" that can foreclose use of the cost approach. Moreover, as the trial court cogently explained, the city's income approach has significant limitations when applied to a regulated utility; most notably, it fails to account for the Juniper system's value to nonregulated buyers and does not compensate the utility for CIACcontributions by J.L. Ward Company and others in aid of the construction and expansion of the utility. Under state utility regulations, Juniper Utility Company *352 was allowed to recoup a reasonable return on its investment. That investment, for ratemaking purposes, did not include property contributed to the utility. OAR 860-037-0567 (CIAC excluded from rates). As a result, the system had little income-producing potential as a regulated utility. And in the city's view, that income-producing potential or lack thereofis, as a matter of law, the only indicator of the utility's fair market value: No hypothetical buyer would pay anything for property that cannot produce income. There are two significant problems with the city's argument, either of which is fatal to its view that the value of the Juniper system was capable of being established by the city's proffered income approach. First, the city's approach did not allow for the utility's income-producing potential to nonregulated buyers. As the trial court aptly pointed out, "[u]nregulated entities can be created for the purpose of buying a utility, such as a peoples utility district or a co-op." Those unregulated buyers would not be subject to the same rate restrictions as a regulated buyer and could potentially operate the utility at a greater profit. See ORS 757.005(1)(b) (exempting "[a]ny plant owned or operated by a municipality" from the definition of "public utility"); ORS 756.010 ("municipality" includes quasi-municipal corporations). For that reason, too, the trial court was not required to accept the city's regulated income approach. Cf. Appeal of Pennichuck Water Works, Inc., 160 N.H. at 41, 992 A.2d at 760 ("[I]t is error not to consider a potential unregulated municipal buyer when valuing a water utility. * * * Even if such a purchase is unlikely, * * * it must be considered. * * * The unlikelihood of sale is, after all, the reason why valuation of public utilities is so extraordinarily difficult and why this court has typically given the trier of fact considerable deference in this area." (Internal citations and quotations omitted.)). Second, the city's approach effectively equates the utility's value for ratemaking purposes with its fair market value for purposes of just compensation. As the trial court correctly observed, courts have rejected that approach given the differences between ratemaking and condemnation proceedings. See, e.g., Dade County, 267 So.2d at 639 (constitutional requirement that property owner receive "full compensation" requires "that the method of valuation which is utilized take into consideration the value of the contributed property"). In fact, the city concedes that it is unable to cite a single case in which the income approach alone was employed as the valuation methodology for an unprofitable public utility. See Moriarty Bd. of Educ. v. Thunder Mtn. Water, 141 N.M. 824, 161 P.3d 869 (2007) (rejecting regulated income valuation approach); Dedeaux Utility Company v. City of Gulfport, 938 So.2d 838 (Miss.2006) (same); WSSC v. Utilities, Inc., 365 Md. 1, 775 A.2d 1178 (2001) (same); Rangeley Water Company v. Rangeley Water Dist., 691 A.2d 171 (Me.1997) (same). To hold otherwise would be to allow the government to confiscate public utility systems that produce little income; the Article I, section 18, guarantee of "just compensation" does not allow that result. The city's retortthat there is nothing unjust about valuing the plant at $0 because the Utility Defendants recouped their investment costs during the sale of their developmentsagain confuses the ratemaking process with condemnation law. In the ratemaking process, the concern is whether the utility is allowed a reasonable return on its investment. In that regulatory context, it matters how utility property has been acquired and whether the utility has already recouped its costs. In an eminent domain casea case in which the government is actually taking private propertythe question is entirely different. For purposes of Article I, section 18, it does not matter how the utility acquired the property or whether it has already recouped the cost of that property from others; what matters is that the utility receive just compensation for the property that is being taken from it. For that reason, and the others stated above, we reject the city's first assignment of error; no fixed principle of eminent domain law precluded the trial court from considering the cost approach in determining the fair market value of the utility or otherwise required the court to use the city's income approach. *353 The city's second through fourth assignments of error take issue with particular aspects of the court's valuationwhat the city characterizes as the trial court's erroneous "application" of the various approaches. As discussed above, the trial court's choice among legally permissible valuation methods is ultimately an issue of fact. The questions raised by the city's arguments, though masquerading as issues of law, ultimately hinge on what evidence the trial court found most persuasive regarding the fair market value of the Juniper system. Suffice it to say that there is evidence in the record to support the trial court's findings in that regard, and we reject the city's second, third, and fourth assignments of error without further discussion. The fifth assignment of error, however, is a different matter. The trial court awarded the Utility Defendants "severance damages" in the amount of $168,996 for an effluent pipe that was not taken by the city but that was "stranded" as a result of the city's taking. In condemnation law, severance damages represent the depreciation in the fair market value of the condemnee's remaining property caused by the taking. Lundberg, 312 Or. at 574, 825 P.2d 641 ("In the case of a partial taking of property, the measure of damages is the fair market value of the property acquired plus any depreciation in the fair market value of the remaining property caused by the taking."); State Highway Comm. v. Hooper, 259 Or. 555, 560, 488 P.2d 421 (1971) ("The depreciation in market value to the remaining land is often called severance damages."). The trial court awarded severance damages in the belief that the effluent pipe was owned by Juniper Utility Company The evidence, however, established that the company did not own that pipe, and the Utility Defendants concede on appeal that "the trial court should not have allocated severance damages for [the] stranded effluent pipe to Juniper Utility." We accept the concession and agree that the judgment must be reversed with respect to that award of severance damages. The city's sixth assignment of error likewise concerns severance damages. The city argues that the trial court erred as a matter of law in using a "restoration cost" and "substitute facility" approach when awarding severance damages for nine holes of the Mountain High golf course, part of J.L. Ward Company's Mountain High development that had been served by Juniper Utility Company. The condensed version of the story is that, after Juniper Utility Company was regulated and its rates were reduced, J.L. Ward Company allowed the golf course to dry up; the Mountain High Homeowners Association sued, and the trial court entered a judgment ordering J.L. Ward Company to maintain the golf course.[14] However, once the city took over the Juniper system, J.L. Ward Company no longer had control of the water source to irrigate the golf course. As part of this action, J.L. Ward Company argued that it was entitled to severance damages for the costs of rebuilding the course, complete with a new irrigation and delivery system. Without its own irrigation system, the company argued, it could not guarantee an adequate supply of affordable water, which was necessary to comply with the judgment in favor of the Mountain High Homeowners Association. The trial court agreed that severance damages were required and that "replacement cost new of the irrigation system, less depreciation in the distribution system, is the appropriate measure of damages." Those severance damages totaled $1,010,828. On appeal, the city argues that the cost of reproducing of the irrigation system was, as a matter of law, an impermissible measure of severance damages in this case. According to the city, reproduction costs are an appropriate measure of severance damages only if those costs are less than the diminution in fair market value to the condemnee's remaining property. The city is correct. In Tunison v. Multnomah County, 251 Or. 602, 604-05, 445 P.2d 498 (1968), the *354 court explained the interplay between reproduction costs and depreciation in fair market value: "The measure of damages for a taking by eminent domain is the fair market value of the strip taken plus any depreciation in the fair market value of the land remaining caused by the taking.1 However, if the cost of restoring the remaining property to the same condition it was in before the taking is less than the depreciation in the market value caused by the taking, then the owner is entitled only to the cost of restoration.2 "1 Pape v. Linn County, 135 Or. 430, 296 P. 65 (1931). "2 `Inasmuch as the measure of damages is the decrease in market value of the land, and the trained judgment of the market in determining value would take into consideration the possibility of restoring the damaged property as far as possible to the same relative position in which it stood before the taking if the cost of such restoration would be less than the increase in market value which it would bring to the land, the condemnor is entitled to the adoption of the criterion of damage which produces the smaller result.' 5 Nichols on Eminent Domain, § 23.2, p. 537 (1962)." (Emphasis added.); see also id. at 605 n. 3 ("5 Nichols on Eminent Domain, supra at p. 537: `[E]vidence of the cost of restoring the property as far as possible to its original relative position, when offered by the owner, is admissible only when there is also evidence that such cost is no greater in amount than the decrease in market value of the property if it is left as it stood.'"); Highway Com. v. Central Paving Company, 240 Or. 71, 77, 399 P.2d 1019 (1965) ("cost of replacing the area of land taken by filling in adjacent land" was not a proper element of just compensation). In other words, the rule is that restoration costs are a proper measure of severance damages only where there is corresponding evidence from which the trier of fact can conclude that the cost of restoration is less than the diminution in fair market value caused by the taking. Here, J.L. Ward Company does not identify any evidence that it presented that would satisfy the Tunison rulethat is, evidence that the diminution in value as a result of the condemnation of the Juniper system was greater than the cost of a new irrigation system. Rather, it contends that the rule in Tunison is simply inapposite because of the legal obligation imposed on J.L. Ward Company to supply water to the golf course. That legal obligation, according to J.L. Ward Company, triggered what is known as the "substitute facility" doctrine, which this court discussed in 1st Meth., Ashland, 6 Or. App. at 494-95, 488 P.2d 835 (explaining that "substitution" or cost of reproduction can be an appropriate measure of fair market value when the condemned property performs "a legally necessary function"). See also Dept. of Trans. v. Southern Pacific Trans. Co., 89 Or.App. 344, 347 n. 2, 749 P.2d 1233, rev. den., 305 Or. 671, 757 P.2d 421 (1988) ("Reproduction costs are appropriate in determining just compensation when the condemnee is under a legal obligation to replace condemned property. Bd. of Higher Ed. v. 1st Meth., Ashland, 6 Or.App. 492, 495, 488 P.2d 835 (1971)."). As we have previously discussed in the context of the city's first assignment of error, ___ Or.App. at ___, 252 P.3d at 349-51, there are certain circumstances in which reproduction costs can be used to determine the fair market value of condemned property. One of those circumstances is where the property owner is legally required to build a "substitute facility" to replace the condemned property, and the fair market value of the condemned property is not capable of being established by other means. See 1st Meth., Ashland, 6 Or.App. at 495-97, 488 P.2d 835 (discussing that "substitute facility" approach but rejecting it where neither of those requirements was met); see also United States v. 50 Acres of Land, 469 U.S. 24, 105 S.Ct. 451, 83 L.Ed.2d 376 (1984) (limiting use of "substitute facility" doctrine in federal takings to circumstances in which fair market value of condemned property cannot be determined by usual means). J.L. Ward Company's reliance on the "substitute facility" doctrine misses the mark, however. The city's sixth assignment of error does not concern the value of the condemned propertyi.e., the utility system. Rather, it pertains to the award of severance *355 damages, an award that represents the loss in value to J.L. Ward Company's remaining property. Said another way, the question is not the fair market value of the condemned utility, but the loss in fair market value of the golf course. Viewed in that light, the trial court erred in valuing the diminution based on the cost of a "substitute facility." Even assuming that the substitute facility doctrine applies to the determination of severance damages, this is not the case in which to apply it. As in 1st Meth., Ashland, J.L. Ward Company has not identified any reason why the fair market value of the golf courseeven saddled by a judgment that it be maintainedcould not have been determined based on a market valuation, and, correspondingly, why it was not possible to determine the diminution in its fair market value as a result of the condemnation of the Juniper system. Accordingly, the judgment must be reversed and remanded for the trial court to consider severance damages in terms of diminution in fair market value of the golf course, the legal standard described in Tunison. The city's seventh assignment pertains to the trial court's award of attorney fees. Because we have partially reversed the trial court's award of just compensation, we likewise reverse the accompanying attorney fee award. See ORS 20.220(3)(a) ("If the appellate court reverses the judgment, the award of attorney fees or costs and disbursements shall be deemed reversed."). At the very least, the trial court will need to reconsider the amount of the fee award in light of the reduction in compensation. See ORS 20.075(2)(d) (in determining amount of attorney fees, court "shall consider," among other factors, the "amount involved in the controversy and the results obtained"). We therefore decline to address the city's seventh assignment of error.[15]
C. Cross-Appeal
We turn, then, to the Utility Defendants' cross-appeal. They advance two assignments of error. First, the Utility Defendants contend that the trial court erred in its valuation of certain "blanket easements." Those easements were donated to Juniper Utility Company by property owners to allow the utility to install a utility corridor and serve properties other than the grantor's property. The trial court concluded that the easements would not add anything to the fair market value of the utility: "[E]asements are typically given to utility providers, particularly for pipes and other underground utilities, for no cost. Utility access makes the ground more valuable. In most instances, real estate cannot be subdivided or developed without utility service and access. The utility provider would not pay for the right to put pipe in the ground in property which would benefit from the infrastructure. A willing buyer simply would not pay value for what is normally given away." The Utility Defendants argue that the trial court's reasoning was erroneous in that regard, because "[t]here is no evidence in the record that a utility owner would consider these blanket easements worthless." The question of fair market value of the easements is, as Utility Defendants acknowledge, one of fact. For that reason, we will not disturb the trial court's finding that the easements lacked independent value to the utility unless there is no evidence to support that finding. The Utility Defendants cannot reach that high bar on appeal. Their own appraiser testified that real estate developers customarily convey or sell easements to utilities for "no charge." We therefore reject the *356 Utility Defendants' first assignment of error on cross-appeal. In their second assignment of error, the Utility Defendants contend that the trial court misconstrued ORS 82.010, the statute governing the accrual of post-judgment interest.[16] That statute provides: "(2) Except as provided in this subsection, the rate of interest on judgments for the payment of money is nine percent per annum. The following apply as described: "* * * * * "(c) Interest accruing from the date of the entry of a judgment shall also accrue on interest that accrued before the date of entry of a judgment." ORS 82.010 (emphasis added). After the verdict was rendered in their favor, the Utility Defendants requested that post-judgment interest run on interest that had accrued before the entry of judgment i.e., post-judgment interest on prejudgment interest.[17] The court denied that request, reasoning that a condemnation judgment is not a "judgment for the payment of money" within the meaning of ORS 82.010. Judgments in condemnation cases are governed by ORS 35.325, which provides: "Upon the assessment of the compensation by the jury, the court shall give judgment appropriating the property in question to the condemner, conditioned upon the condemner's paying into court the compensation assessed by the jury; and, after the making of such payment, the judgment shall become effective to convey the property, and the right of possession thereof to the condemner if not previously acquired." (Emphasis added.) Said otherwise, "the judgment in a condemnation case is, by statute, a conditional judgment." State ex rel. English v. Multnomah County, 348 Or. 417, 438, 238 P.3d 980 (2010). In fact, even after a verdict on just compensation is rendered, the condemner still has the option of abandoning the condemnation. See ORS 35.335(3) ("An action is considered abandoned if, at any time after filing a complaint, the case is dismissed or terminated or the condemner files an election not to take the property. If an election is not filed within 60 days after the verdict, the condemner is considered to have elected to take the property."). The "conditional" nature of a condemnation judgment, the trial court ruled, was critical. The court explained that "the condemnation judgment will not require the payment of money," but will instead "appropriate property conditioned on the payment of money." (Emphasis by trial court.) By contrast, the court ruled, a "judgment for the payment of money" must actually require the payment. To that end, the court determined that the phrase "judgment for the payment of money" in ORS 82.010 means a "money award" as defined in ORS chapter 18, which, in turn, refers to a "judgment or portion of a judgment that requires the payment of money." ORS 18.005(14) (defining "money award"); see also ORS 18.042(1) (judgments that include a money award "must contain a separate section clearly labeled as a money award"). On appeal, the Utility Defendants argue that the trial court's ruling is inconsistent with the plain text of ORS 82.010 and ORS 35.325. We agree. The phrase "judgment for the payment of money" in ORS 82.010 is not synonymous with "money award" in ORS chapter 18. ORS 82.010 long antedated the term "money award," which was added to ORS chapter 18 in 2003 as part of an overhaul of the law regarding the form and content of judgments generally. See Or. Laws 2003, ch. 576 (containing the complete text of the so-called "judgments bill," HB 2646); Or. Laws 1987, ch. 873, § 26 (enacting provision regarding "interest on judgments for the payment of money"). We are not aware of any statutory text, context, or legislative *357 history that would suggest those 2003 amendments were intended to address the law regarding entitlement to post-judgment interest under ORS 82.010. In our view, the question is not one of form (whether a condemnation judgment should be reduced to the form of a "money award" under ORS chapter 18) but rather one of substance: Is a condemnation judgment a "judgment for the payment of money"? Framed in that way, a condemnation judgment, whether conditional or not, is "for the payment of money." Indeed, for the judgment to have any effect at all, the condemner must "pay [] into court the compensation assessed by the jury." ORS 35.325 (emphasis added). The fact that the condemner can abandon the condemnation effort does not, in our view, alter what is, fundamentally, a judgment for the payment of money. The trial court erred in concluding otherwise. In sum, we reject the city's arguments that the court erred as a matter of law in valuing the condemned utility plant based on the cost approach, and we therefore do not disturb on appeal the trial court's award of just compensation as to the Juniper system property. However, we conclude that the trial court erred in awarding severance damages regarding the stranded effluent pipe and the Mountain High golf course. We therefore reverse and remand for the trial court to reassess those aspects of the compensation award, and to then reconsider the questions of post-judgment interest and attorney fees. On appeal, reversed and remanded for reconsideration of severance damages and attorney fees; otherwise affirmed. On cross-appeal, reversed and remanded to reconsider post-judgment interest; otherwise affirmed. NOTES [1] Our review of the complicated factual and legal issues in this case was significantly aided by the trial court's thorough and thoughtful opinion. [2] For convenience, we refer to the utility system as the "Juniper Utility Company system" or the "Juniper system," recognizing, as did the trial court, that other persons or entities may own or have a legal interest in parts of the system. [3] Jan and Kim were two of four brothers who owned development companies. In 1974, Jan bought out his brothers and is the majority shareholder of J.L. Ward Company, the successor to the other development companies. [4] Jan later formed Juniper Water Company, a nonprofit corporation, to own the distribution, storage, and source water assets in certain developed areas within the Juniper system. [5] The court's valuation of water rights, easements, and real property taken in fee is not challenged by the parties, except to the extent that the Utility Defendants disagree with the court's valuation of certain blanket easements, one of the subjects of the cross-appeal. [6] Before entering the judgment, the court held further proceedings on the apportionment of compensation among the various defendants that had interests in the Juniper system. That aspect of the court's judgment is not relevant to the issues on appeal or cross-appeal. [7] The trial court explained:
"There is no established market for the sale of water or waste water utilities in Oregon or in Washington. The appraisers have identified no sales of a combined water and waste water utility. There are no sales of a two pipe water utility. There are no sales of private utilities of the size of Juniper Utility Company. There are simply no comparable sales. Sales that have occurred do not establish any pattern or customary ratio between sale price per customer or sale price as a function of rate base. There is no evidence of fair market value based upon the market approach." [8] To the extent that the matter of just compensation is one of fact entrusted to a jury, or to a court in lieu of a jury, we review for any evidence to support the verdict. ORS 19.415(1); ORCP 62 F. [9] The Utility Defendants suggest that, because the city does not assign error to the court's ruling on the admissibility of evidence regarding the cost approach, our review is for "any evidence" to support the court's election. See Highway Commission v. Dumas, 238 Or. 449, 454, 395 P.2d 424 (1964) ("The rule approved by the courts is that when cross-examination develops that the opinion of a witness as to the value of property is based wholly, or in substantial part, on improper or illegal elements, a motion to strike out the testimony of the witness as to value will lie * * *."). Although the issue might have been presented more cleanly on appeal had the city assigned error to the earlier evidentiary rulings, the trial court plainly understood the central issue in the case to be whether the cost approach was a legally permissible valuation methodology, and we therefore address the city's argument that the court erred as a matter of law in considering the cost approach. Cf. State Highway Com. v. Vella, 213 Or. 386, 395-96, 323 P.2d 941 (1958) (court committed reversible error in instructing the jury regarding proper consideration of evidence of business losses in determining fair market value; "We do not think that the erroneous reception of such evidence, even though without objection, authorizes a court to change established rules of law fixing the measure of recovery in a condemnation proceeding."). [10] The Utility Defendants' experts calculated present reproduction costs and then used an indexing method to determine original costa lower figure than present reproduction costs. In employing the cost approach, the court used original cost less depreciation as opposed to present reproduction cost less depreciation. At times, the city refers in its first assignment to the trial court's error in using "original cost" to value the plant, but we do not understand the assignment to challenge the use of "original" as opposed to "reproduction" costs. That is, we understand the city to argue that the court should have used the income approach rather than the cost approach, as opposed to arguing that the court erred in using original rather than reproduction costs (which actually resulted in a lower fair market value, thereby benefitting the city). [11] Although Delta Air Lines, Inc., is a tax case, there is no reason to think that the appraisal methodology applies differently in condemnation cases. [12] In 1st Meth., Ashland, we concluded that the jury was improperly instructed regarding consideration of the "replacement cost" of the condemned property because it was not special use property. 6 Or.App. at 495, 488 P.2d 835 ("We see no `speciality' in the physical makeup of the youth center that renders market value inapplicable as a measure of compensation."). After concluding that the property was not "special use," we discussed additional limitations on the cost approach that are not helpful to our analysis of this assignment of error but that are relevant to our later discussion of the city's sixth assignment of error. [13] Moreover, we note that the cost approach has long served as an accepted method for determining fair market value in tax cases, including the fair market value of public utilities. See, e.g., Shields v. Dept. of Rev., 266 Or. 461, 464-66, 513 P.2d 784 (1973) (where no comparable sales for regional shopping center were available, and income and expenses of shopping center had not stabilized, cost approach was the proper method of determining property's fair market value); P. P. & L. Co. v. Dept. of Rev., 308 Or. 49, 775 P.2d 303 (1989) (deriving fair market value of utility from cost approach and income approach). We see no reason why a different rule would apply in this context, given the unique nature of the Juniper system. [14] For the longer version, see Mountain High Homeowners Assn. v. J.L. Ward Co., 228 Or.App. 424, 209 P.3d 347 (2009). [15] The assignment pertains to the trial court's determination of "bad faith" under ORS 35.346(7)(b) (2001). The trial court, however, awarded attorney fees on an alternate and independent basis: that the verdict exceeded the city's 30-day offer, ORS 35.346(7)(a) (2001) (court shall award attorney fees "[i]f the amount of just compensation assessed by the verdict in the trial exceeds the highest written offer in settlement submitted by condemner to those defendants appearing in the action at least 30 days prior to commencement of said trial"). In fact, the court expressed its reluctance to address the parties' arguments concerning ORS 35.346(7)(b), given that the Utility Defendants were entitled to fees under paragraph (a) of that statute. It is not clear whether the court will even need to reach ORS 35.346(7)(b) on remand, if the Utility Defendants are entitled to attorney fees under ORS 35.346(7)(a). [16] Although we have partially reversed the judgment, the issue of post-judgment interest will arise on remand, and we therefore address it. [17] Prejudgment interest is "deemed a part of the damages suffered by the defendants as a result of the appropriation" where, as in this case, the condemner took possession of the property before the property was condemned. State Highway Com'n v. Deal et al., 191 Or. 661, 684, 233 P.2d 242 (1951). | 11-01-2013 | [
"252 P.3d 341 (2011) 242 Or. App. 9 CITY OF BEND, Plaintiff-Appellant Cross-Respondent, v. JUNIPER UTILITY COMPANY, an Oregon corporation; J.L. Ward Company, an Oregon corporation; and Jan L. Ward, Defendants-Respondents Cross-Appellants, and Juniper Water Company, an Oregon nonprofit corporation; Homeowners of Tillicum Village, an Oregon nonprofit corporation; Homeowners of Nottingham Square Association, an Oregon nonprofit corporation; Timber Ridge Homeowners Association, an Oregon nonprofit corporation; Frederick W. Rusch, II; Paul B. Brewer and Donna M. Brewer, Trustees of Brewer Family Trust; Richard R. Reynolds and Joann J. Reynolds, Trustees of Reynolds 1991 Revocable *342 Living Trust; Alfred J. Caputo; Gordon Westergard and Sharon K. Westergard, dba The Pines Mobile Home Park; Jo Ann L. Gamette, Trustee of the Jo Ann L. Gamette Living Trust; Dennis Beltrame, trustee; Margaret Beltrame, trustee; Larry Beser, dba Quail Ridge Mobile Home Park; Kim D. Ward, LLC, dba Crown Villa RV Park, an Oregon limited liability company; Ward Investment Properties, Inc., an Oregon corporation; Kim D. Ward; Mountain High Homeowners Association, an Oregon nonprofit corporation; River Place MHC, a California limited partnership, Defendants.",
"02CV0202ST; A137087. Court of Appeals of Oregon. Argued and Submitted October 6, 2010. Decided April 6, 2011. *343 John W. Stephens, Portland, argued the cause for appellant-cross-respondent. With him on the briefs was Esler Stephens & Buckley. Gregory R. Mowe, Portland, argued the cause for respondents-cross-appellants. With him on the briefs were William F. Buchanan, Brad S. Daniels, and Stoel Rives LLP. On the reply brief was James N. Westwood. Before SCHUMAN, Presiding Judge, and WOLLHEIM, Judge, and ROSENBLUM, Judge. SCHUMAN, P.J. Nearly a decade ago, the City of Bend determined that a water and sewer utility, Juniper Utility Company, was not meeting the needs of its customers, so the city filed a condemnation action to take ownership of the utility for public use.",
"The central question at trial was the proper method for determining the fair market value of the utility plant. The trial court applied what is known as the \"cost approach\" in determining that the fair market value of the plant was approximately $3.3 million. The city appeals, arguing that the court erred in applying the cost approach and that, under the proper testthe \"income approach\"the fair market value was actually far less, because the plant had virtually no potential to generate income and, for that reason, no buyer would pay anything for it. Juniper Utility Company and other defendants in the case (collectively \"the Utility Defendants\") cross-appeal, arguing that the award of just compensation was in fact too low, and that they were entitled to additional compensation for certain easements as well as further post-judgment interest. For the reasons that follow, we affirm the judgment with respect to the trial court's valuation of the utility plant, reverse with respect to the award of certain severance damages, and remand.",
"I. BACKGROUND We take the relevant facts from the trial court's explicit and implicit factual findings, which are supported by evidence in the record. ORCP 62 F (\"In an action tried without a jury, * * * the findings of the court upon the facts shall have the same force and effect, and be equally conclusive, as the verdict of a jury.\"). [1] To the extent that the parties dispute the particulars or importance of various factual findings, we address those issues in greater detail in later sections of this opinion. In the 1960s, the Ward brothers began developing various properties in the Bend area. In 1972, two of the brothers, Jan and Kim, incorporated Juniper Utility Company to provide water and sewer services to support the family's development projects.",
"Over the years, the Juniper Utility Company system[2] evolved into what is now a unique combination of water delivery facilities with a sewage disposal and treatment system. The water delivery facilities include a two-pipe system, one pipe that delivers potable water and another that provides irrigation water. The two-pipe system serves approximately 1,125 customers in southeastern Bend and supplies them with nonpotable irrigation water at an affordable price, thereby allowing them to keep their neighborhoods lush *344 throughout the summer. The sewage collection system, meanwhile, is pressurized by pump stations at customer residences; waste is pumped to a treatment plant for processing, and effluent from the plant is then pumped through pipes and disposed of on land owned by J.L. Ward Company, the successor to the various Ward businesses. Much of the dispute in this case stems from the fact that Juniper Utility Company was never intended to be an independent profit source for its owners.",
"Rather, from its inception, the Wards viewed it as a project that would support their other profit-making development ventures. Once the utility company was incorporated, various Ward family entities and individuals transferred ownership of an existing treatment plant, water reservoir, and certain pump and well sites to Juniper Utility Company, as well as certain \"blanket easements\" i.e., easements to use their land for installation and maintenance of utilities, and to use and maintain certain \"ponds.\" The utility company, meanwhile, agreed to provide water and sewer services to properties owned by the grantors \"on a non-profit basis.\" In addition to those capital contributions known in utility terminology as \"contributions in aid of construction\"the Ward family and its entities also bore the initial cost of expanding the utility infrastructure.",
"When a parcel of land was developed, J.L. Ward Company[3] would subdivide the land and then build the utility infrastructure in the common areas or, in some cases, on land dedicated to the public. Juniper Utility Company was then given an easement for its pipes and other facilities. As lots or homes were sold in the development, J.L. Ward Company recouped the cost of the infrastructure as part of the sales price. The utility entered into a series of operating agreements with homeowners associations (HOAs) and with Kim Ward (who developed mobile home and RV parks) that provided that rates would be set at a level necessary to operate and maintain the utilities but that \"[n]o accumulations for profit shall be made. \"[4] For more than two decades, Juniper Utility Company set its own rates for water and wastewater services. In 1998, however, the Oregon Public Utility Commission (PUC) asserted regulatory authority over Juniper Utility Company and held ratemaking proceedings. See ORS 757.061 (describing water utilities subject to financial regulation). In 2000, the PUC entered an order determining \"fair, just, and reasonable rates\" for Juniper Utility Company's services; those rates were substantially lower than the rates that Juniper Utility Company had been charging its customers.",
"The way in which Juniper Utility Company was created and operated had a significant effect on the rates set by the PUC. As a general matter, the ratemaking process is intended to provide utilities an opportunity to earn a fair and reasonable return on their investment. Property that the utility receives as a contribution in aid of construction \"CIAC\" for shortis not considered part of the utility's investment and is therefore given a value of zero for purposes of calculating the utility's rate base, which is the amount of investment on which a regulated public utility can earn a fair and reasonable return.",
"In setting rates for Juniper Utility Company, the PUC determined that developer contributionsthat is, capital contributions from J.L. Ward Company and others to create and expand the utilitywere CIAC and would therefore not be considered in calculating a reasonable return on investment. As a result, the PUC determined that the total rate base for the utility was less than $100,000. The PUC authorized a 10 percent rate of return, the PUC's generic rate for water utilities, thereby allowing Juniper Utility Company to earn a return of less than $10,000 per year from its rate base. After its rates were set at that reduced level, J.L. Ward Company, which had paid for necessary maintenance of Juniper Utility *345 Company, stopped supporting the utility. Capital improvements and maintenance were deferred; service was curtailed and became inadequate in many respects. Customers responded with complaints about the utility to the PUC and to the City of Bend. Thereafter, the PUC and the city sought and obtained injunctive relief requiring Juniper Utility Company to provide adequate service.",
"In September 2001, the Bend City Council adopted a resolution of necessity and intent to appropriate the Juniper system property. The city initiated this condemnation action in April 2002. See ORS 225.020(1)(a) (authorizing a city to bring an action for condemnation to \"[a]cquire water systems and use, sell and dispose of its water for domestic, recreational, industrial, and public use and for irrigation and other purposes within and without its boundaries\"). The city's condemnation complaint sought to take various Juniper system assets for public use, including pipes, valves, pumps, wells, headgates, hydrants, a wastewater treatment facility, sewer lift stations, and other infrastructure, as well as water rights, real property, and utility easements. During the course of the litigation, the most hotly contested issue was the method of valuation to be used to determine the fair market value that the city should be required to pay for the \"utility plant\"that is, \"all pipes, valves, pumps, wells, treatment facilities and other infrastructure.\" As later discussed in greater detail, there are three commonly utilized methodologies for appraising the value of plants like the Juniper system: (1) the market approach, which looks at comparable sales data; (2) the income approach, which looks at the income-generating potential of the property; and (3) the cost approach, a valuation typically based on replacement or reproduction cost of the plant minus any depreciation.",
"See generally Appraisal Institute, The Appraisal of Real Estate (12th ed. 2001). The parties agreed that the market approach was unhelpful in this case, because there were no comparable sales of plants like the Juniper system. The city therefore urged the court to apply the income approach, which would have valued the plant based on its potential to generate income to a willing buyer. Under that approach, the city contended, the plant had a fair market value of zero; thanks to the utility's rate base, which did not account for CIAC, the regulated plant was essentially worthless because it could generate only a negligible return. The Utility Defendants, meanwhile, argued that the plant's regulated income potential admittedly nothingfailed to capture the fair market value of the utility. The better approach, in their view, was the cost approach. That approach, according to the Utility Defendants, would account for the fact that CIAC, though not counted for purposes of ratemaking, nevertheless is valuable property that cannot be taken without just compensation. The trial court, in an extensive written opinion, agreed with the Utility Defendants that the cost approach provided the best indicator of the plant's fair market value.",
"The court explained that it is \"not a novel concept in eminent domain law * * * that the condemning authority must pay fair market value, regardless of how the condemnee came to own the taken property.\" Accordingly, the \"intrinsic value\" of the plant \"does not disappear because of the decision by J.L. Ward Company to contribute the assets, rather than loan Juniper Utility Company the money to buy the assets. A taking of the Juniper Utility Company assets for no compensation [as the city proposed] would be little more than a confiscation.\" The court continued, \"Nor does the difficulty in valuing a special use asset work to deprive it of value. Certainly, Juniper Utility Company is a unique, special purpose property.",
"As a result, there is no ability to value it using the market approach as there are no comparable sales. The income approach fails to value the taken property at all. In this situation, it is black letter law that the cost approach may be considered.\" Although the court concluded that \"[t]he cost approach is the only method of valuation appropriate in this case,\" it nevertheless declined to accept the Utility Defendants' appraisal \"lock, stock and barrel.\" Rather, the court concluded that the starting point for *346 determining fair market value of the plant was \"original cost new less depreciation,\" which, according to the court, would take into account the age and condition of the plant and the regulatory environment (including the fact that even an unregulated buyer would not pay more for the plant than the original cost of the plant less depreciation).",
"In the end, the court found \"the fair market value of the Juniper Utility Co. plant to be $3,297,859.\" The court separately valued water rights ($347,590), easements ($1,515,883), and real property taken in fee ($326,400). As relevant here, in valuing the easements, the court concluded that certain \"blanket easements\"those easements that had been granted to Juniper Utility Company to facilitate access to the utility infrastructure were typically granted to utility providers at no cost and should therefore not increase the compensation award. [5] The court also awarded the Utility Defendants damages for impairment to their remaining property that was caused by the condemnation of the utility. The court then entered a judgment of condemnation that included prejudgment but not post-judgment interest as part of the calculation of just compensation. The city appeals, and the Utility Defendants cross-appeal. [6] II. ANALYSIS A.",
"The Law of Eminent Domain A quick primer on the law of eminent domain is helpful to set the stage for the parties' various assignments of error. Under Article I, section 18, of the Oregon Constitution, \"Private property shall not be taken for public use * * * without just compensation[.]\" Private property is \"taken\" for public use through the exercise of the power of eminent domainthat is, \"`the power inherent in a sovereign state of taking or of authorizing the taking of any property within its jurisdiction for a public use or benefit.'\"",
"Dept. of Trans. v. Lundberg, 312 Or. 568, 571 n. 1, 825 P.2d 641, cert. den., 506 U.S. 975, 113 S.Ct. 467, 121 L.Ed.2d 374 (1992) (quoting MacVeagh v. Multnomah County, 126 Or. 417, 431-32, 270 P. 502 (1928)). Governmental units with eminent domain authority, such as the City of Bend, can exercise that authority by instituting condemnation proceedings. See ORS chapter 35 (governing condemnation proceedings). If the condemner and the property owner cannot agree on \"just compensation,\" the issue is tried to the jury or a court. See ORS 35.305(2) (\"Condemner and defendant may offer evidence of just compensation, but neither party shall have the burden of proof of just compensation.\"). Under Oregon law, \"just compensation\" is determined based on the fair market value of the property that is being taken. Fair market value, in turn, is \"defined as the amount of money the property would bring if it were offered for sale by one who desired, but was not obliged, to sell and was purchased by one who was willing, but not obliged, to buy.\" Lundberg, 312 Or.",
"at 574, 825 P.2d 641. In other words, \"just compensation\" is the amount that a willing buyer would pay a willing seller for the condemned property. B. The Appeal The difficulty, of course, is how to figure out what a willing buyer would pay a willing seller for a public utility like the Juniper planta water and sewage system for which there is no established market. [7] That is the *347 primary issue on appeal, as it has been throughout this litigation: In the absence of comparable sales, what is the proper methodology for determining the fair market value of the Juniper system?",
"The city argues that the method utilized by the trial court, the cost approach, was erroneous as a matter of law: \"The trial court erred as a matter of law when it used the cost method to determine the fair market value (just compensation) of property that its owner(s) devoted to a public purpose and that was necessary or useful to provide water and wastewater utility service-particularly where the market value of that property was capable of being established by the income method.\"",
"The parties, as an initial matter, disagree about the proper standard of review with respect to the trial court's use of the cost approach. The city argues that \"[w]hat approach, method, or theory a court should properly use to determine the fair market value of property is a matter of law for the court, and the Court of Appeals reviews the trial court's decision for errors of law.\" The Utility Defendants, meanwhile, submit that the \"trial court's choice of valuation methodology and most of the other decisions that the City challenges are questions of fact reviewed under the any evidence standard of review.\"",
"Fair market value in condemnation cases is ultimately a question of fact. See Lundberg, 312 Or. at 574-75, 825 P.2d 641 (\"The question of the highest and best use of particular property is not a question of constitutional magnitude or of law, but is a question of fact that relates to the question of value and is to be decided by a jury. \"); Selbee v. Multnomah County, 247 Or. 390, 394, 430 P.2d 561 (1967) (\"In order to enable the jury to pass intelligently upon the question of whether the market value of the remaining land has been increased as a result of the improvement, we think that, at least in the generality of cases, there must be some evidence of that fact other than the improvement itself.\" (Emphasis added.)). [8] At the same time, courts have always served an important role in cabining the \"just compensation\" inquiry i.e., in applying limits on what a trier of fact can consider when determining fair market value. See, e.g., Santiam Lumber Co. v. Conhaim, 218 Or. 220, 224, 344 P.2d 247 (1959) (\"We think that in a condemnation proceeding to acquire an easement for a logging road right of way, evidence of the quantity of timber that might be transported over the right of way is not a proper factor to be considered by the jury in determining the fair market value of the land being condemned.\").",
"Neither the Supreme Court nor this court has ever addressed exactly where valuation methodology falls on the continuum between questions of fact and questions of law in eminent domain cases. However, in tax casescases involving public utilities, no lessthe Supreme Court has repeatedly observed that, when determining fair market value, the choice among particular valuation methods is generally a fact-based inquiry rather than a question of law. See, e.g., United Telephone Co. v. Dept. of Rev., 307 Or. 428, 431, 770 P.2d 43 (1989) (\"[W]hen this court evaluates and then either accepts or rejects various theories of valuation offered by the parties, it almost always does so as a finder of fact on de novo review of the record made in the Tax Court.",
"\"); Pacific Power & Light Co. v. Dept. of Revenue, 286 Or. 529, 533, 596 P.2d 912 (1979) (\"[W]hether in any given assessment one [valuation] approach should be used exclusive of the others or is preferable to another or to a combination of approaches is a question of fact to be determined by the court upon the record. \"); Brooks Resources Corp. v. Dept. of Revenue, 286 Or. 499, 503, 595 P.2d 1358 (1979) (reviewing as a fact question the choice among \"three standard approaches to valuation: the market data approach, the income approach, and the cost approach\").",
"*348 The court's discussion of valuation methodologies in Brooks Resources Corp. is particularly illuminating: \"We have observed in previous cases of this kind that there are three standard approaches to valuation: the market data approach, the income approach, and the cost approach. Bend Millwork v. Dept. of Revenue, 285 Or. 577, 592 P.2d 986 (1979); Medical Building Land Company v. Dept. of Rev., 283 Or. 69, 582 P.2d 416 (1978); Swenson v. Dept. of Revenue, 276 Or. 1, 553 P.2d 351 (1976). The appropriateness of a particular valuation method or combination of methods is not determined by fixed principles of law, but is a factual determination that depends on the record developed in each case. See Medical Building Land Company v. Dept. of Rev., supra at 78-79 [582 P.2d 416].",
"Because we try this case `anew upon the record,' we must determine which of the above approaches to valuation, under the facts of this case, best reflects the `true cash value' of the property. In making this determination, we emphasize that we are performing our function as fact-finder, not our function as a corrector of legal errors.\" 286 Or. at 503-04, 595 P.2d 1358 (omitted). The tax context differs, of course, from condemnation in many ways, but the basic premise of Brooks Resources Corp. carries over to any context in which a factfinder is charged with determining fair market value, be it a conversion case, a tax case, or a condemnation case.",
"That is, unless some fixed principle of the law demands otherwise, it is left to the trier of fact to assess the evidence, including expert testimony regarding the appropriateness of a particular valuation methodology, and to then make a factual call as to the fair market value of the property in question. Viewed through that prism, we understand the city's first assignment of error to present a rather narrow legal question: whether some fixed principle of eminent domain law prohibited the trial court from considering the cost approach as part of its factual determination of fair market value. If so, the trial court committed reversible error in relying on that evidence as it did; in the absence of such a fixed principle, however, we will not second-guess the trial court's decision to give weight to a particular valuation approach in finding a fair market value for the Juniper system. [9] The city offers several interrelated reasons as to why the cost approach was, as a matter of law, an impermissible valuation methodology in this case.",
"The contentions, as we understand them, boil down to the following: (1) The cost approach is evidence of the maximum amount that a willing buyer might pay, not a measure of fair market value in itself; for that reason, Oregon courts have approved the use of the cost approach only as a ceiling when other valuation methods yield a higher fair market value. (2) The appropriate measure of fair market value for a public utility like the Juniper system is, as a matter of law, the income approach, not the cost approach. We are not persuaded by those contentions. The city's primary argument is that the cost approach, standing alone, never yields a fair market value for purposes of eminent domain. That is so, the city argues, because \"[t]he cost approach, unlike the market approach *349 and the income approach, has no external reference to the market.\" According to the city, \"[t]he cost approach is based on the principle of `substitution,' that a willing buyer would not pay more for a property than the cost of constructing a comparable facility.\" For that reason, the argument goes, \"Oregon courts have consistently held that the cost approach is not an appropriate way to value property in an eminent domain action. \"[10] After canvassing the authority cited by the city, we are not persuaded that the cost approach serves such a limited role in assessing fair market value, particularly in a condemnation case like this.",
"The underpinnings and application of the cost approach have long been the subject of scholarly debate. In his treatise on the appraisal of property, Professor Bonbright explains that the principle of substitution \"merely justifies the inference that * * * property cannot be worth more than its replacement cost,\" but that \"[i]t by no means warrants the further inference that the value is as high as this, or even that the value is nearer to replacement cost than it is to zero\"a point that \"the American courts have often failed to recognize[.]\" James C. Bonbright, I Valuation of Property 159 (1st ed.",
"1937). \"Nevertheless,\" Bonbright continues, \"under certain circumstances an appraiser is warranted in accepting an estimate that the replacement cost of property, with proper allowance for incidental loss and for depreciation, as the best available measure of its value.\" Id. (emphasis added). One of those circumstances, he later explains, is in eminent domain cases: \"Estimates of current replacement cost minus arbitrary deductions for depreciation must often be accepted in default of a better measure.\" Id. at 420-21. Modern authorities likewise have taken the view that the cost approach, in addition to establishing an upper limit to fair market value, can itself be an acceptable indicator of fair market value in some cases: \"Buyers of these [special-purpose or specialty properties not frequently exchanged in the market] often measure the price they will pay for an existing building against the cost to build minus depreciation or the cost to purchase an existing structure and make any necessary modifications.",
"If comparable sales are not available, they cannot be analyzed to develop an opinion of the market value of such properties. Therefore, current market indications of depreciated cost or the costs to acquire and refurbish an existing building are the best reflections of market thinking and, thus, of market value * * *.\" The Appraisal of Real Estate at 354; accord Delta Air Lines, Inc. v. Dept. of Rev., 328 Or.",
"596, 605, 984 P.2d 836 (1999) (\"The cost approach to value is based upon the principle of substitution, that is, it assumes that property is worth its cost or the cost of a satisfactory substitute with equal utility.\" (Emphasis added.)). [11] Indeed, Oregon courts have specifically recognizedif not endorsedthe cost approach as an appropriate valuation methodology in condemnation cases involving special use property for which comparable sales data is unavailable. In Highway Comm. v. Superbilt Mfg.",
"Co., 204 Or. 393, 419-20, 281 P.2d 707 (1955), the court, quoting a leading treatise on the subject of eminent domain, stated: \"Peculiar circumstances warranting a resort to other considerations than the usual tests for determining market value are set forth in 4 Nichols, Eminent Domain 133, § 12.32, as follows: *350 \"`It occasionally happens that a parcel of real estate taken by eminent domain is of such a nature, or is held or has been improved in such a manner, that, while it serves a useful purpose to its owner, if he desired to dispose of it he would be unable to sell it at anything like its real value. A church, or a college building, or a club-house located in a town in which there was but one religious society, or college, or club, might be worth all it cost to its owners, but it would be absolutely unmarketable. * * *.",
"Even such a piece of property as a mill site or a reservoir site, or a factory or store of abnormal size may, to a somewhat lesser degree, be difficult to dispose of, though of great value to its owner. \"`In such a case as similar property is not commonly bought and sold it is impossible to ascertain market value by the usual tests. In fact, as market value presupposes a willing buyer, the conditions upon which such value is based are not present, and it is sometimes said that in cases of this character market value is not the measure of compensation.",
"As it is conceded that the owner cannot on that account be deprived of his property without any compensation whatever, some other measure is sought. It must, however, be remembered that market value is always based upon hypothetical conditions, and that it is never necessary to show that there was in fact a person able and willing to buy. The measure is still what another religious society, or college, or club, or public service corporation, or abutting owner, would pay if there were one at hand; in other words, the measure is still market value.",
"However, since the usual means of ascertaining market value are lacking, other means must from the necessity of the case be resorted to. It is, therefore, proper in such cases to deduce market value from the intrinsic value of the property, and its value to its owners for their special purposes. * * *.'\" (Emphasis added.) The cost approach is one of the \"other means\" for deducing the fair market value of special use property in eminent domain cases.",
"In Bd. of Higher Ed. v. 1st Meth., Ashland, 6 Or.App. 492, 494, 488 P.2d 835 (1971), we explained: \"Market value is the recognized measure of compensation when land is taken by eminent domain. Highway Comm. v. Superbilt Mfg. Company, 204 Or. 393, 281 P.2d 707 (1955); 4 Nichols', Eminent Domain 41, § 12.2 (1962). Other criteria are recognized, though, in special circumstances. One is the `replacement facility' theory, described in 4 Nichols', § 12.32 at 227: \"`Where a building is a specialty, and, in a sense, unique, being constructed for a special use, the valuation cannot be predicated on the same basis as a building constructed for general * * * use. * * * It has been held under such circumstances that reproduction cost or replacement cost may be considered * * *. '\"[12] See also Julius L. Sackman, 4 Nichols on Eminent Domain, § 12C.01[3][b] (rev. 2001) (citing cases that have approved the use of the cost method for special use property); S.W. Moore, 8 Nichols on Eminent Domain § G14A.06 (rev.",
"2008) (\"The three basic approaches to value are: (1) Market, (2) Cost, and (3) Income. All three may apply to public-utility valuation, with modifications. \"); cf. State Hwy. Comm. v. Demarest, 263 Or. 590, 607 n. 2, 503 P.2d 682 (1972) (\"Often market value of trade fixtures, based on comparable sales, is difficult to determine in cases where the trade fixtures are being evaluated separately in condemnation cases. In such circumstances, other approaches, *351 such as reproduction or replacement costs less depreciation, are used.\" (Emphasis added.)). Accordingly, we are not persuaded by the city's contention that Oregon courts have categorically rejected the use of the cost approach by a trier of fact as part of the ultimate determination of fair market value. The question whether the trier of fact may permissibly consider that approach in determining fair market value has been determined by Oregon courts on the facts of each case, as it has been in other jurisdictions.",
"See, e.g., Dade County v. General Waterworks Corp., 267 So.2d 633, 641 (Fla.1972) (describing use of \"reproduction cost method\" in valuing utilities for condemnation purposes); The Appraisal of Real Estate at 354 (\"The cost approach is also used to develop an opinion of market value * * * [of] special-purpose or specialty properties, and other properties that are not frequently exchanged in the market. \"); accord Appeal of Pennichuck Water Works, Inc., 160 N.H. 18, 38, 992 A.2d 740, 757 (N.H.2010) (\"The trier of fact may use any one or a combination of five appraisal techniques in valuing public utility property: original cost less depreciation (rate base or net book), comparable sales, cost of alternate facilities, capitalized earnings, and reproduction cost less depreciation. * * * We have * * * never attempted to tie the fact finder's hands with a rigid fair market value formula in the absence of legislative directive.\" (Internal citations and quotation marks omitted.)). [13] The city offers a fallback argument in the event this court disagrees, as we do, with its categorical rejection of the cost approach.",
"The city seizes on language in Superbilt Mfg. Co. in which the court held, \"[I]nasmuch as the property being appropriated had a market value that could be determined by the usual tests, it was error to admit evidence respecting reproduction costs * * *.\" 204 Or. at 426, 281 P.2d 707. From that holding, the city posits that resort to the cost approach was likewise legal error in this case because the market value of the Juniper system was capable of being established by the income approach. That argument has two premises: (1) that \"the usual tests\" include the income approach; and (2) that the fair market value of the Juniper system was capable of being established by the income approach. Neither premise is correct. The reference to \"the usual tests\" for valuation in Superbilt Mfg. Co. is to the type of measures of value that are possible for property that is regularly bought and soldin other words, the market approach. The opinion earlier discusses \"the usual tests\" in that context: \"`In such a case as similar property is not commonly bought and sold it is impossible to ascertain market value by the usual tests.'\" Id.",
"at 419, 281 P.2d 707 (quoting 4 Nichols on Eminent Domain 133, § 12.32). And, on the facts in Superbilt Mfg. Co., that was indeed the casethe property at issue was an empty warehouse, and the court observed that \"[t]here is no question that empty warehouse buildings of the type and construction of the building involved in this litigation have a market value in the city of Portland and vicinity, and that such market value may easily be established in the usual manner.\" Id. at 427, 281 P.2d 707. Thus, we are not persuaded that the income approach, at least in the context of a regulated utility, is one of \"the usual tests\" that can foreclose use of the cost approach.",
"Moreover, as the trial court cogently explained, the city's income approach has significant limitations when applied to a regulated utility; most notably, it fails to account for the Juniper system's value to nonregulated buyers and does not compensate the utility for CIACcontributions by J.L. Ward Company and others in aid of the construction and expansion of the utility. Under state utility regulations, Juniper Utility Company *352 was allowed to recoup a reasonable return on its investment. That investment, for ratemaking purposes, did not include property contributed to the utility. OAR 860-037-0567 (CIAC excluded from rates). As a result, the system had little income-producing potential as a regulated utility. And in the city's view, that income-producing potential or lack thereofis, as a matter of law, the only indicator of the utility's fair market value: No hypothetical buyer would pay anything for property that cannot produce income. There are two significant problems with the city's argument, either of which is fatal to its view that the value of the Juniper system was capable of being established by the city's proffered income approach.",
"First, the city's approach did not allow for the utility's income-producing potential to nonregulated buyers. As the trial court aptly pointed out, \"[u]nregulated entities can be created for the purpose of buying a utility, such as a peoples utility district or a co-op.\" Those unregulated buyers would not be subject to the same rate restrictions as a regulated buyer and could potentially operate the utility at a greater profit. See ORS 757.005(1)(b) (exempting \"[a]ny plant owned or operated by a municipality\" from the definition of \"public utility\"); ORS 756.010 (\"municipality\" includes quasi-municipal corporations). For that reason, too, the trial court was not required to accept the city's regulated income approach. Cf. Appeal of Pennichuck Water Works, Inc., 160 N.H. at 41, 992 A.2d at 760 (\"[I]t is error not to consider a potential unregulated municipal buyer when valuing a water utility.",
"* * * Even if such a purchase is unlikely, * * * it must be considered. * * * The unlikelihood of sale is, after all, the reason why valuation of public utilities is so extraordinarily difficult and why this court has typically given the trier of fact considerable deference in this area.\" (Internal citations and quotations omitted.)). Second, the city's approach effectively equates the utility's value for ratemaking purposes with its fair market value for purposes of just compensation. As the trial court correctly observed, courts have rejected that approach given the differences between ratemaking and condemnation proceedings. See, e.g., Dade County, 267 So.2d at 639 (constitutional requirement that property owner receive \"full compensation\" requires \"that the method of valuation which is utilized take into consideration the value of the contributed property\"). In fact, the city concedes that it is unable to cite a single case in which the income approach alone was employed as the valuation methodology for an unprofitable public utility.",
"See Moriarty Bd. of Educ. v. Thunder Mtn. Water, 141 N.M. 824, 161 P.3d 869 (2007) (rejecting regulated income valuation approach); Dedeaux Utility Company v. City of Gulfport, 938 So.2d 838 (Miss.2006) (same); WSSC v. Utilities, Inc., 365 Md. 1, 775 A.2d 1178 (2001) (same); Rangeley Water Company v. Rangeley Water Dist., 691 A.2d 171 (Me.1997) (same). To hold otherwise would be to allow the government to confiscate public utility systems that produce little income; the Article I, section 18, guarantee of \"just compensation\" does not allow that result. The city's retortthat there is nothing unjust about valuing the plant at $0 because the Utility Defendants recouped their investment costs during the sale of their developmentsagain confuses the ratemaking process with condemnation law. In the ratemaking process, the concern is whether the utility is allowed a reasonable return on its investment. In that regulatory context, it matters how utility property has been acquired and whether the utility has already recouped its costs.",
"In an eminent domain casea case in which the government is actually taking private propertythe question is entirely different. For purposes of Article I, section 18, it does not matter how the utility acquired the property or whether it has already recouped the cost of that property from others; what matters is that the utility receive just compensation for the property that is being taken from it. For that reason, and the others stated above, we reject the city's first assignment of error; no fixed principle of eminent domain law precluded the trial court from considering the cost approach in determining the fair market value of the utility or otherwise required the court to use the city's income approach. *353 The city's second through fourth assignments of error take issue with particular aspects of the court's valuationwhat the city characterizes as the trial court's erroneous \"application\" of the various approaches.",
"As discussed above, the trial court's choice among legally permissible valuation methods is ultimately an issue of fact. The questions raised by the city's arguments, though masquerading as issues of law, ultimately hinge on what evidence the trial court found most persuasive regarding the fair market value of the Juniper system. Suffice it to say that there is evidence in the record to support the trial court's findings in that regard, and we reject the city's second, third, and fourth assignments of error without further discussion. The fifth assignment of error, however, is a different matter. The trial court awarded the Utility Defendants \"severance damages\" in the amount of $168,996 for an effluent pipe that was not taken by the city but that was \"stranded\" as a result of the city's taking.",
"In condemnation law, severance damages represent the depreciation in the fair market value of the condemnee's remaining property caused by the taking. Lundberg, 312 Or. at 574, 825 P.2d 641 (\"In the case of a partial taking of property, the measure of damages is the fair market value of the property acquired plus any depreciation in the fair market value of the remaining property caused by the taking. \"); State Highway Comm. v. Hooper, 259 Or.",
"555, 560, 488 P.2d 421 (1971) (\"The depreciation in market value to the remaining land is often called severance damages.\"). The trial court awarded severance damages in the belief that the effluent pipe was owned by Juniper Utility Company The evidence, however, established that the company did not own that pipe, and the Utility Defendants concede on appeal that \"the trial court should not have allocated severance damages for [the] stranded effluent pipe to Juniper Utility.\" We accept the concession and agree that the judgment must be reversed with respect to that award of severance damages. The city's sixth assignment of error likewise concerns severance damages. The city argues that the trial court erred as a matter of law in using a \"restoration cost\" and \"substitute facility\" approach when awarding severance damages for nine holes of the Mountain High golf course, part of J.L.",
"Ward Company's Mountain High development that had been served by Juniper Utility Company. The condensed version of the story is that, after Juniper Utility Company was regulated and its rates were reduced, J.L. Ward Company allowed the golf course to dry up; the Mountain High Homeowners Association sued, and the trial court entered a judgment ordering J.L. Ward Company to maintain the golf course. [14] However, once the city took over the Juniper system, J.L. Ward Company no longer had control of the water source to irrigate the golf course.",
"As part of this action, J.L. Ward Company argued that it was entitled to severance damages for the costs of rebuilding the course, complete with a new irrigation and delivery system. Without its own irrigation system, the company argued, it could not guarantee an adequate supply of affordable water, which was necessary to comply with the judgment in favor of the Mountain High Homeowners Association. The trial court agreed that severance damages were required and that \"replacement cost new of the irrigation system, less depreciation in the distribution system, is the appropriate measure of damages.\" Those severance damages totaled $1,010,828. On appeal, the city argues that the cost of reproducing of the irrigation system was, as a matter of law, an impermissible measure of severance damages in this case. According to the city, reproduction costs are an appropriate measure of severance damages only if those costs are less than the diminution in fair market value to the condemnee's remaining property.",
"The city is correct. In Tunison v. Multnomah County, 251 Or. 602, 604-05, 445 P.2d 498 (1968), the *354 court explained the interplay between reproduction costs and depreciation in fair market value: \"The measure of damages for a taking by eminent domain is the fair market value of the strip taken plus any depreciation in the fair market value of the land remaining caused by the taking.1 However, if the cost of restoring the remaining property to the same condition it was in before the taking is less than the depreciation in the market value caused by the taking, then the owner is entitled only to the cost of restoration.2 \"1 Pape v. Linn County, 135 Or. 430, 296 P. 65 (1931). \"2 `Inasmuch as the measure of damages is the decrease in market value of the land, and the trained judgment of the market in determining value would take into consideration the possibility of restoring the damaged property as far as possible to the same relative position in which it stood before the taking if the cost of such restoration would be less than the increase in market value which it would bring to the land, the condemnor is entitled to the adoption of the criterion of damage which produces the smaller result.' 5 Nichols on Eminent Domain, § 23.2, p. 537 (1962).\"",
"(Emphasis added. ); see also id. at 605 n. 3 (\"5 Nichols on Eminent Domain, supra at p. 537: `[E]vidence of the cost of restoring the property as far as possible to its original relative position, when offered by the owner, is admissible only when there is also evidence that such cost is no greater in amount than the decrease in market value of the property if it is left as it stood. '\"); Highway Com. v. Central Paving Company, 240 Or. 71, 77, 399 P.2d 1019 (1965) (\"cost of replacing the area of land taken by filling in adjacent land\" was not a proper element of just compensation). In other words, the rule is that restoration costs are a proper measure of severance damages only where there is corresponding evidence from which the trier of fact can conclude that the cost of restoration is less than the diminution in fair market value caused by the taking. Here, J.L.",
"Ward Company does not identify any evidence that it presented that would satisfy the Tunison rulethat is, evidence that the diminution in value as a result of the condemnation of the Juniper system was greater than the cost of a new irrigation system. Rather, it contends that the rule in Tunison is simply inapposite because of the legal obligation imposed on J.L. Ward Company to supply water to the golf course. That legal obligation, according to J.L. Ward Company, triggered what is known as the \"substitute facility\" doctrine, which this court discussed in 1st Meth., Ashland, 6 Or. App. at 494-95, 488 P.2d 835 (explaining that \"substitution\" or cost of reproduction can be an appropriate measure of fair market value when the condemned property performs \"a legally necessary function\"). See also Dept.",
"of Trans. v. Southern Pacific Trans. Co., 89 Or.App. 344, 347 n. 2, 749 P.2d 1233, rev. den., 305 Or. 671, 757 P.2d 421 (1988) (\"Reproduction costs are appropriate in determining just compensation when the condemnee is under a legal obligation to replace condemned property. Bd. of Higher Ed. v. 1st Meth., Ashland, 6 Or.App. 492, 495, 488 P.2d 835 (1971).\"). As we have previously discussed in the context of the city's first assignment of error, ___ Or.App. at ___, 252 P.3d at 349-51, there are certain circumstances in which reproduction costs can be used to determine the fair market value of condemned property. One of those circumstances is where the property owner is legally required to build a \"substitute facility\" to replace the condemned property, and the fair market value of the condemned property is not capable of being established by other means. See 1st Meth., Ashland, 6 Or.App.",
"at 495-97, 488 P.2d 835 (discussing that \"substitute facility\" approach but rejecting it where neither of those requirements was met); see also United States v. 50 Acres of Land, 469 U.S. 24, 105 S.Ct. 451, 83 L.Ed.2d 376 (1984) (limiting use of \"substitute facility\" doctrine in federal takings to circumstances in which fair market value of condemned property cannot be determined by usual means). J.L. Ward Company's reliance on the \"substitute facility\" doctrine misses the mark, however. The city's sixth assignment of error does not concern the value of the condemned propertyi.e., the utility system. Rather, it pertains to the award of severance *355 damages, an award that represents the loss in value to J.L. Ward Company's remaining property.",
"Said another way, the question is not the fair market value of the condemned utility, but the loss in fair market value of the golf course. Viewed in that light, the trial court erred in valuing the diminution based on the cost of a \"substitute facility.\" Even assuming that the substitute facility doctrine applies to the determination of severance damages, this is not the case in which to apply it. As in 1st Meth., Ashland, J.L. Ward Company has not identified any reason why the fair market value of the golf courseeven saddled by a judgment that it be maintainedcould not have been determined based on a market valuation, and, correspondingly, why it was not possible to determine the diminution in its fair market value as a result of the condemnation of the Juniper system.",
"Accordingly, the judgment must be reversed and remanded for the trial court to consider severance damages in terms of diminution in fair market value of the golf course, the legal standard described in Tunison. The city's seventh assignment pertains to the trial court's award of attorney fees. Because we have partially reversed the trial court's award of just compensation, we likewise reverse the accompanying attorney fee award. See ORS 20.220(3)(a) (\"If the appellate court reverses the judgment, the award of attorney fees or costs and disbursements shall be deemed reversed.\"). At the very least, the trial court will need to reconsider the amount of the fee award in light of the reduction in compensation. See ORS 20.075(2)(d) (in determining amount of attorney fees, court \"shall consider,\" among other factors, the \"amount involved in the controversy and the results obtained\"). We therefore decline to address the city's seventh assignment of error.",
"[15] C. Cross-Appeal We turn, then, to the Utility Defendants' cross-appeal. They advance two assignments of error. First, the Utility Defendants contend that the trial court erred in its valuation of certain \"blanket easements.\" Those easements were donated to Juniper Utility Company by property owners to allow the utility to install a utility corridor and serve properties other than the grantor's property. The trial court concluded that the easements would not add anything to the fair market value of the utility: \"[E]asements are typically given to utility providers, particularly for pipes and other underground utilities, for no cost. Utility access makes the ground more valuable. In most instances, real estate cannot be subdivided or developed without utility service and access. The utility provider would not pay for the right to put pipe in the ground in property which would benefit from the infrastructure. A willing buyer simply would not pay value for what is normally given away.\" The Utility Defendants argue that the trial court's reasoning was erroneous in that regard, because \"[t]here is no evidence in the record that a utility owner would consider these blanket easements worthless.\" The question of fair market value of the easements is, as Utility Defendants acknowledge, one of fact. For that reason, we will not disturb the trial court's finding that the easements lacked independent value to the utility unless there is no evidence to support that finding. The Utility Defendants cannot reach that high bar on appeal.",
"Their own appraiser testified that real estate developers customarily convey or sell easements to utilities for \"no charge.\" We therefore reject the *356 Utility Defendants' first assignment of error on cross-appeal. In their second assignment of error, the Utility Defendants contend that the trial court misconstrued ORS 82.010, the statute governing the accrual of post-judgment interest. [16] That statute provides: \"(2) Except as provided in this subsection, the rate of interest on judgments for the payment of money is nine percent per annum. The following apply as described: \"* * * * * \"(c) Interest accruing from the date of the entry of a judgment shall also accrue on interest that accrued before the date of entry of a judgment.\" ORS 82.010 (emphasis added). After the verdict was rendered in their favor, the Utility Defendants requested that post-judgment interest run on interest that had accrued before the entry of judgment i.e., post-judgment interest on prejudgment interest.",
"[17] The court denied that request, reasoning that a condemnation judgment is not a \"judgment for the payment of money\" within the meaning of ORS 82.010. Judgments in condemnation cases are governed by ORS 35.325, which provides: \"Upon the assessment of the compensation by the jury, the court shall give judgment appropriating the property in question to the condemner, conditioned upon the condemner's paying into court the compensation assessed by the jury; and, after the making of such payment, the judgment shall become effective to convey the property, and the right of possession thereof to the condemner if not previously acquired.\" (Emphasis added.) Said otherwise, \"the judgment in a condemnation case is, by statute, a conditional judgment.\" State ex rel. English v. Multnomah County, 348 Or.",
"417, 438, 238 P.3d 980 (2010). In fact, even after a verdict on just compensation is rendered, the condemner still has the option of abandoning the condemnation. See ORS 35.335(3) (\"An action is considered abandoned if, at any time after filing a complaint, the case is dismissed or terminated or the condemner files an election not to take the property. If an election is not filed within 60 days after the verdict, the condemner is considered to have elected to take the property.\"). The \"conditional\" nature of a condemnation judgment, the trial court ruled, was critical.",
"The court explained that \"the condemnation judgment will not require the payment of money,\" but will instead \"appropriate property conditioned on the payment of money.\" (Emphasis by trial court.) By contrast, the court ruled, a \"judgment for the payment of money\" must actually require the payment. To that end, the court determined that the phrase \"judgment for the payment of money\" in ORS 82.010 means a \"money award\" as defined in ORS chapter 18, which, in turn, refers to a \"judgment or portion of a judgment that requires the payment of money.\"",
"ORS 18.005(14) (defining \"money award\"); see also ORS 18.042(1) (judgments that include a money award \"must contain a separate section clearly labeled as a money award\"). On appeal, the Utility Defendants argue that the trial court's ruling is inconsistent with the plain text of ORS 82.010 and ORS 35.325. We agree. The phrase \"judgment for the payment of money\" in ORS 82.010 is not synonymous with \"money award\" in ORS chapter 18. ORS 82.010 long antedated the term \"money award,\" which was added to ORS chapter 18 in 2003 as part of an overhaul of the law regarding the form and content of judgments generally. See Or. Laws 2003, ch. 576 (containing the complete text of the so-called \"judgments bill,\" HB 2646); Or. Laws 1987, ch. 873, § 26 (enacting provision regarding \"interest on judgments for the payment of money\"). We are not aware of any statutory text, context, or legislative *357 history that would suggest those 2003 amendments were intended to address the law regarding entitlement to post-judgment interest under ORS 82.010. In our view, the question is not one of form (whether a condemnation judgment should be reduced to the form of a \"money award\" under ORS chapter 18) but rather one of substance: Is a condemnation judgment a \"judgment for the payment of money\"?",
"Framed in that way, a condemnation judgment, whether conditional or not, is \"for the payment of money.\" Indeed, for the judgment to have any effect at all, the condemner must \"pay [] into court the compensation assessed by the jury.\" ORS 35.325 (emphasis added). The fact that the condemner can abandon the condemnation effort does not, in our view, alter what is, fundamentally, a judgment for the payment of money. The trial court erred in concluding otherwise. In sum, we reject the city's arguments that the court erred as a matter of law in valuing the condemned utility plant based on the cost approach, and we therefore do not disturb on appeal the trial court's award of just compensation as to the Juniper system property. However, we conclude that the trial court erred in awarding severance damages regarding the stranded effluent pipe and the Mountain High golf course.",
"We therefore reverse and remand for the trial court to reassess those aspects of the compensation award, and to then reconsider the questions of post-judgment interest and attorney fees. On appeal, reversed and remanded for reconsideration of severance damages and attorney fees; otherwise affirmed. On cross-appeal, reversed and remanded to reconsider post-judgment interest; otherwise affirmed. NOTES [1] Our review of the complicated factual and legal issues in this case was significantly aided by the trial court's thorough and thoughtful opinion. [2] For convenience, we refer to the utility system as the \"Juniper Utility Company system\" or the \"Juniper system,\" recognizing, as did the trial court, that other persons or entities may own or have a legal interest in parts of the system. [3] Jan and Kim were two of four brothers who owned development companies. In 1974, Jan bought out his brothers and is the majority shareholder of J.L.",
"Ward Company, the successor to the other development companies. [4] Jan later formed Juniper Water Company, a nonprofit corporation, to own the distribution, storage, and source water assets in certain developed areas within the Juniper system. [5] The court's valuation of water rights, easements, and real property taken in fee is not challenged by the parties, except to the extent that the Utility Defendants disagree with the court's valuation of certain blanket easements, one of the subjects of the cross-appeal. [6] Before entering the judgment, the court held further proceedings on the apportionment of compensation among the various defendants that had interests in the Juniper system. That aspect of the court's judgment is not relevant to the issues on appeal or cross-appeal. [7] The trial court explained: \"There is no established market for the sale of water or waste water utilities in Oregon or in Washington. The appraisers have identified no sales of a combined water and waste water utility. There are no sales of a two pipe water utility. There are no sales of private utilities of the size of Juniper Utility Company.",
"There are simply no comparable sales. Sales that have occurred do not establish any pattern or customary ratio between sale price per customer or sale price as a function of rate base. There is no evidence of fair market value based upon the market approach.\" [8] To the extent that the matter of just compensation is one of fact entrusted to a jury, or to a court in lieu of a jury, we review for any evidence to support the verdict. ORS 19.415(1); ORCP 62 F. [9] The Utility Defendants suggest that, because the city does not assign error to the court's ruling on the admissibility of evidence regarding the cost approach, our review is for \"any evidence\" to support the court's election. See Highway Commission v. Dumas, 238 Or. 449, 454, 395 P.2d 424 (1964) (\"The rule approved by the courts is that when cross-examination develops that the opinion of a witness as to the value of property is based wholly, or in substantial part, on improper or illegal elements, a motion to strike out the testimony of the witness as to value will lie * * *.\"). Although the issue might have been presented more cleanly on appeal had the city assigned error to the earlier evidentiary rulings, the trial court plainly understood the central issue in the case to be whether the cost approach was a legally permissible valuation methodology, and we therefore address the city's argument that the court erred as a matter of law in considering the cost approach.",
"Cf. State Highway Com. v. Vella, 213 Or. 386, 395-96, 323 P.2d 941 (1958) (court committed reversible error in instructing the jury regarding proper consideration of evidence of business losses in determining fair market value; \"We do not think that the erroneous reception of such evidence, even though without objection, authorizes a court to change established rules of law fixing the measure of recovery in a condemnation proceeding.\"). [10] The Utility Defendants' experts calculated present reproduction costs and then used an indexing method to determine original costa lower figure than present reproduction costs. In employing the cost approach, the court used original cost less depreciation as opposed to present reproduction cost less depreciation. At times, the city refers in its first assignment to the trial court's error in using \"original cost\" to value the plant, but we do not understand the assignment to challenge the use of \"original\" as opposed to \"reproduction\" costs. That is, we understand the city to argue that the court should have used the income approach rather than the cost approach, as opposed to arguing that the court erred in using original rather than reproduction costs (which actually resulted in a lower fair market value, thereby benefitting the city). [11] Although Delta Air Lines, Inc., is a tax case, there is no reason to think that the appraisal methodology applies differently in condemnation cases.",
"[12] In 1st Meth., Ashland, we concluded that the jury was improperly instructed regarding consideration of the \"replacement cost\" of the condemned property because it was not special use property. 6 Or.App. at 495, 488 P.2d 835 (\"We see no `speciality' in the physical makeup of the youth center that renders market value inapplicable as a measure of compensation.\"). After concluding that the property was not \"special use,\" we discussed additional limitations on the cost approach that are not helpful to our analysis of this assignment of error but that are relevant to our later discussion of the city's sixth assignment of error. [13] Moreover, we note that the cost approach has long served as an accepted method for determining fair market value in tax cases, including the fair market value of public utilities. See, e.g., Shields v. Dept. of Rev., 266 Or. 461, 464-66, 513 P.2d 784 (1973) (where no comparable sales for regional shopping center were available, and income and expenses of shopping center had not stabilized, cost approach was the proper method of determining property's fair market value); P. P. & L. Co. v. Dept.",
"of Rev., 308 Or. 49, 775 P.2d 303 (1989) (deriving fair market value of utility from cost approach and income approach). We see no reason why a different rule would apply in this context, given the unique nature of the Juniper system. [14] For the longer version, see Mountain High Homeowners Assn. v. J.L. Ward Co., 228 Or.App. 424, 209 P.3d 347 (2009). [15] The assignment pertains to the trial court's determination of \"bad faith\" under ORS 35.346(7)(b) (2001). The trial court, however, awarded attorney fees on an alternate and independent basis: that the verdict exceeded the city's 30-day offer, ORS 35.346(7)(a) (2001) (court shall award attorney fees \"[i]f the amount of just compensation assessed by the verdict in the trial exceeds the highest written offer in settlement submitted by condemner to those defendants appearing in the action at least 30 days prior to commencement of said trial\"). In fact, the court expressed its reluctance to address the parties' arguments concerning ORS 35.346(7)(b), given that the Utility Defendants were entitled to fees under paragraph (a) of that statute. It is not clear whether the court will even need to reach ORS 35.346(7)(b) on remand, if the Utility Defendants are entitled to attorney fees under ORS 35.346(7)(a). [16] Although we have partially reversed the judgment, the issue of post-judgment interest will arise on remand, and we therefore address it.",
"[17] Prejudgment interest is \"deemed a part of the damages suffered by the defendants as a result of the appropriation\" where, as in this case, the condemner took possession of the property before the property was condemned. State Highway Com'n v. Deal et al., 191 Or. 661, 684, 233 P.2d 242 (1951)."
] | https://www.courtlistener.com/api/rest/v3/opinions/2625453/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 1 of 5
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS
__________________________________________ ) LOUIS J. DESY JR. ) ) Plaintiff, ) ) v. ) ) Civil Action No.: AZZ, INC., ) ) Defendant ) _________________________________________)
NOTICE OF REMOVAL OF CIVIL ACTION TO THE UNITED STATES DISTRICT COURT
PLEASE TAKE NOTICE that Defendant AZZ Inc. (“AZZ”) hereby removes the civil
action pending in the Commonwealth of Massachusetts, Superior Court Department, styled Louis
J. Desy Jr. v. AZZ, Incorporated, Civil Action No. 1985CV01315, to the United States District
Court for the District of Massachusetts. Defendant will promptly file a Notice of this Removal
with the Commonwealth of Massachusetts, Superior Court Department, Worcester County, and
serve the Notice on all parties.
GROUNDS FOR REMOVAL JURISDICTION
1. Pursuant to 28 U.S.C. § 1446, AZZ invokes this District Court’s jurisdiction under
28 U.S.C. § 1441 (providing that defendants may remove any civil action, filed in state court, of
which the District Courts of the United States have original jurisdiction), 28 U.S.C. § 1332
(granting District Courts original jurisdiction of all civil actions between persons of diverse
citizenship), and 28 U.S.C. §1331 (granting District Courts original jurisdiction of all civil actions
arising under the laws of the United States).
1 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 2 of 5
2. On September 9, 2019, Plaintiff Louis J. Desy Jr. (“Desy”) filed an Original
Complaint and Jury Demand against AZZ in the Commonwealth of Massachusetts, Superior Court
Department, Worcester County (the “Complaint”). A copy of the Complaint, along with all other
documents filed with the Commonwealth of Massachusetts, Superior Court Department, is
attached hereto as Exhibit 1. Exhibit 1 constitutes all of the process and pleadings that have been
served upon AZZ in this action. Attested to copies of all docket entries in the Massachusetts
Superior Court record shall be filed within 28 days, in accordance with Local Rules 5.4(f) and
81.1(a). The Civil Cover Sheet, as required by Local Rules 3.1 and 5.4(e), and Local Category
Sheet are attached hereto as Exhibit 2.
3. In the Complaint, Desy alleges myriad claims relating to his former employment
with AZZ, including non-payment of commissions, non-payment of overtime, age discrimination
in violation of M.G.L. c. 151B and the Age Discrimination in Employment Act (ADEA), wrongful
termination as against public policy, and libel and slander.
4. At the time of filing of this action, as stated in Paragraph 2 of the Complaint, and at
the time of filing of this Notice, Desy resides in Worcester, Massachusetts, and is therefore a
citizen of the Commonwealth of Massachusetts. As stated in Paragraph 3 of the Complaint, AZZ
is not a citizen of the State of Massachusetts. AZZ is a Texas corporation with its principal place
of business in Texas. AZZ is therefore a citizen of the State of Texas. 28 U.S.C. § 1332(c)(1).
Removal is proper because there is complete diversity between the parties.
5. In addition, Desy seeks a “wage bonus” of “$18,171” (Complaint, ¶ 10), “overtime
compensation” for allegedly working 20 hours of overtime per week for “several years”
(Complaint, ¶ 6), “statutory trebling of damages” related to those claims (Complaint, Jury
Demand), as well as unspecified damages for age discrimination (Count III), wrongful termination
2 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 3 of 5
(Count IV), and libel and slander (Count V). Because the parties have complete diversity of
citizenship and because the amount in controversy exceeds the $75,000 statutory minimum for
diversity jurisdiction, this Court has original jurisdiction under 28 U.S.C. § 1332.
6. Furthermore, on its face, Desy’s Complaint alleges a violation of the Federal Age
Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621-634 (Count III). Desy also alleges
that AZZ violated “Federal Laws on wrongful termination based on public policy” (Count IV).
Because Desy has alleged claims sounding under the laws of the United States, this Court has
original jurisdiction under 28 U.S.C. § 1331.
7. AZZ received the Complaint on September 23, 2019. Removal pursuant to 28 U.S.C.
§ 1446(b) is timely because this Notice of Removal has been filed within thirty days of the AZZ’s
receipt of the Complaint, “the initial pleading setting forth the claim for relief upon which such
action or proceeding is based.” 28 U.S.C. § 1446(b)(1).
8. Venue is proper in this district under 28 U.S.C. § 1441(a) because the state court
where the suit has been pending is located in this district.
9. Defendant will give notice of the filing of this Notice of Removal to the Plaintiff
and to the Commonwealth of Massachusetts, Superior Court Department, in which Civil Action
No. 1985CV01315 is pending.
10. AZZ seeks removal of this action without prejudice to any and all defenses available
to it, such as objections to service of process and jurisdiction.
PRAYER
WHEREFORE, Defendant AZZ Inc., respectfully prays that this matter, previously
pending in the Commonwealth of Massachusetts, Superior Court Department, styled Louis J. Desy
3 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 4 of 5
Jr. v. AZZ, Incorporated, Civil Action No. 1985CV01315, be removed to the United States District
Court for the District of Massachusetts.
Respectfully Submitted,
AZZ, INC.,
By their attorneys,
/s/ John E. (Jed) DeWick________________ John E. (Jed) DeWick (BBO #654723) Kevin B. Smith (BBO #688418) ARROWOOD LLP 10 Post Office Square, 7th Floor South Boston, MA 02109 (617) 849-6200 (617) 849-6201 (Fax) jdewick@arrowoodllp.com ksmith@arrowoodllp.com
Dated: October 22, 2019
4 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 5 of 5
CERTIFICATE OF SERVICE
I hereby certify that this document filed through the ECF system will be sent electronically to the registered participants as identified on the Notice of Electronic Filing (NEF) or sent by first-class mail to any persons presently indicated as non-registered participants on this date.
/s/ Kevin B. Smith
Kevin Smith, BBO (BBO # 688418) October 22, 2019
5 | 2019-10-22 | [
"Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 1 of 5 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS __________________________________________ ) LOUIS J. DESY JR. ) ) Plaintiff, ) ) v. ) ) Civil Action No. : AZZ, INC., ) ) Defendant ) _________________________________________) NOTICE OF REMOVAL OF CIVIL ACTION TO THE UNITED STATES DISTRICT COURT PLEASE TAKE NOTICE that Defendant AZZ Inc. (“AZZ”) hereby removes the civil action pending in the Commonwealth of Massachusetts, Superior Court Department, styled Louis J. Desy Jr. v. AZZ, Incorporated, Civil Action No. 1985CV01315, to the United States District Court for the District of Massachusetts.",
"Defendant will promptly file a Notice of this Removal with the Commonwealth of Massachusetts, Superior Court Department, Worcester County, and serve the Notice on all parties. GROUNDS FOR REMOVAL JURISDICTION 1. Pursuant to 28 U.S.C. § 1446, AZZ invokes this District Court’s jurisdiction under 28 U.S.C. § 1441 (providing that defendants may remove any civil action, filed in state court, of which the District Courts of the United States have original jurisdiction), 28 U.S.C. § 1332 (granting District Courts original jurisdiction of all civil actions between persons of diverse citizenship), and 28 U.S.C. §1331 (granting District Courts original jurisdiction of all civil actions arising under the laws of the United States).",
"1 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 2 of 5 2. On September 9, 2019, Plaintiff Louis J. Desy Jr. (“Desy”) filed an Original Complaint and Jury Demand against AZZ in the Commonwealth of Massachusetts, Superior Court Department, Worcester County (the “Complaint”). A copy of the Complaint, along with all other documents filed with the Commonwealth of Massachusetts, Superior Court Department, is attached hereto as Exhibit 1. Exhibit 1 constitutes all of the process and pleadings that have been served upon AZZ in this action. Attested to copies of all docket entries in the Massachusetts Superior Court record shall be filed within 28 days, in accordance with Local Rules 5.4(f) and 81.1(a).",
"The Civil Cover Sheet, as required by Local Rules 3.1 and 5.4(e), and Local Category Sheet are attached hereto as Exhibit 2. 3. In the Complaint, Desy alleges myriad claims relating to his former employment with AZZ, including non-payment of commissions, non-payment of overtime, age discrimination in violation of M.G.L. c. 151B and the Age Discrimination in Employment Act (ADEA), wrongful termination as against public policy, and libel and slander. 4. At the time of filing of this action, as stated in Paragraph 2 of the Complaint, and at the time of filing of this Notice, Desy resides in Worcester, Massachusetts, and is therefore a citizen of the Commonwealth of Massachusetts. As stated in Paragraph 3 of the Complaint, AZZ is not a citizen of the State of Massachusetts. AZZ is a Texas corporation with its principal place of business in Texas. AZZ is therefore a citizen of the State of Texas.",
"28 U.S.C. § 1332(c)(1). Removal is proper because there is complete diversity between the parties. 5. In addition, Desy seeks a “wage bonus” of “$18,171” (Complaint, ¶ 10), “overtime compensation” for allegedly working 20 hours of overtime per week for “several years” (Complaint, ¶ 6), “statutory trebling of damages” related to those claims (Complaint, Jury Demand), as well as unspecified damages for age discrimination (Count III), wrongful termination 2 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 3 of 5 (Count IV), and libel and slander (Count V). Because the parties have complete diversity of citizenship and because the amount in controversy exceeds the $75,000 statutory minimum for diversity jurisdiction, this Court has original jurisdiction under 28 U.S.C. § 1332.",
"6. Furthermore, on its face, Desy’s Complaint alleges a violation of the Federal Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621-634 (Count III). Desy also alleges that AZZ violated “Federal Laws on wrongful termination based on public policy” (Count IV). Because Desy has alleged claims sounding under the laws of the United States, this Court has original jurisdiction under 28 U.S.C. § 1331. 7. AZZ received the Complaint on September 23, 2019.",
"Removal pursuant to 28 U.S.C. § 1446(b) is timely because this Notice of Removal has been filed within thirty days of the AZZ’s receipt of the Complaint, “the initial pleading setting forth the claim for relief upon which such action or proceeding is based.” 28 U.S.C. § 1446(b)(1). 8. Venue is proper in this district under 28 U.S.C. § 1441(a) because the state court where the suit has been pending is located in this district. 9. Defendant will give notice of the filing of this Notice of Removal to the Plaintiff and to the Commonwealth of Massachusetts, Superior Court Department, in which Civil Action No. 1985CV01315 is pending.",
"10. AZZ seeks removal of this action without prejudice to any and all defenses available to it, such as objections to service of process and jurisdiction. PRAYER WHEREFORE, Defendant AZZ Inc., respectfully prays that this matter, previously pending in the Commonwealth of Massachusetts, Superior Court Department, styled Louis J. Desy 3 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 4 of 5 Jr. v. AZZ, Incorporated, Civil Action No. 1985CV01315, be removed to the United States District Court for the District of Massachusetts. Respectfully Submitted, AZZ, INC., By their attorneys, /s/ John E. (Jed) DeWick________________ John E. (Jed) DeWick (BBO #654723) Kevin B. Smith (BBO #688418) ARROWOOD LLP 10 Post Office Square, 7th Floor South Boston, MA 02109 (617) 849-6200 (617) 849-6201 (Fax) jdewick@arrowoodllp.com ksmith@arrowoodllp.com Dated: October 22, 2019 4 Case 4:19-cv-40135-TSH Document 1 Filed 10/22/19 Page 5 of 5 CERTIFICATE OF SERVICE I hereby certify that this document filed through the ECF system will be sent electronically to the registered participants as identified on the Notice of Electronic Filing (NEF) or sent by first-class mail to any persons presently indicated as non-registered participants on this date.",
"/s/ Kevin B. Smith Kevin Smith, BBO (BBO # 688418) October 22, 2019 5"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/111502147/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
No opinion. Judgment and order affirmed, with costs. | 09-09-2022 | [
"No opinion. Judgment and order affirmed, with costs."
] | https://www.courtlistener.com/api/rest/v3/opinions/8075224/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
354 So. 2d 409 (1978) Richard Lee SUNDELL, Appellant, v. The STATE of Florida, Appellee. No. 76-564. District Court of Appeal of Florida, Third District. January 17, 1978. Rehearing Denied February 17, 1978. Richard R. Snyder, Miami, for appellant. Robert L. Shevin, Atty. Gen., and Margarita G. Esquiroz, Asst. Atty. Gen., and Robert Kent Burlington, Legal Intern, for appellee. Before HUBBART and KEHOE, JJ., and CHARLES CARROLL (Ret.), Associate Judge. *410 HUBBART, Judge. The defendant Richard Lee Sundell appeals from a judgment of conviction for robbery and a twenty-five year sentence entered thereon after a finding of guilt in a non-jury trial before the Circuit Court for the Eleventh Judicial Circuit of Florida. The defendant contends on appeal that the evidence is insufficient to support the robbery conviction herein and that the case should be reversed and remanded for a new trial. Our review of the record reveals that the defendant made no motion for a judgment of acquittal and no post-trial motion for a new trial in the trial court. Accordingly, we affirm. The law of this state is well-settled that unless the issue of sufficiency of the evidence to support a verdict in a criminal case is first presented to the trial court by way of a motion for judgment of acquittal or motion for new trial, the issue is not reviewable on direct appeal from an adverse judgment. The same rule obtains notwithstanding a claim on appeal, as is true in this case, that trial counsel was inadequate or incompetent in failing to make the appropriate trial or post-trial motions. There is only one exception to this rule: the Supreme Court of Florida in a capital case in which the death sentence has been imposed is empowered to make an independent review of record to determine whether the evidence is sufficient to support the verdict regardless of whether the issue was presented to the trial court by proper motion. Tibbs v. State, 337 So. 2d 788 (Fla. 1976); State v. Barber, 301 So. 2d 7 (Fla. 1974); Mancini v. State, 273 So. 2d 371 (Fla. 1973); § 921.141(4), Florida Statutes (1975). Measured by these established standards, it is clear that this court has no power to entertain the defendant's contention that the evidence is insufficient to support the verdict because it was never presented to the trial court by appropriate motion. We are without authority to entertain the issue for the first time on appeal in this non-capital case. The defendant's reliance on Tibbs v. State, 337 So. 2d 788 (Fla. 1976), and Platt v. State, 65 Fla. 253, 61 So. 502 (1913) is misplaced. In both cases, the defendant was convicted of a capital crime and sentenced to death. As such, appropriate motions in the trial court attacking the sufficiency of the evidence to support the verdict were not required in order to raise the issue for the first time on appeal. Nor is Nims v. State, 70 Fla. 530, 70 So. 565 (1915), in point because there the defendant made an appropriate motion for new trial which was denied by the trial court, thus preserving the sufficiency question for appeal. And implicit in the decisions of McNeil v. State, 104 Fla. 360, 139 So. 791 (1932); Clark v. State, 98 Fla. 874, 124 So. 446 (1929); Fuller v. State, 92 Fla. 873, 110 So. 528 (1926); Ross v. State, 190 So. 2d 187 (Fla. 3d DCA 1966), is that appropriate motions were made at the trial level preserving the sufficiency question for appeal. We are not unmindful of the admonition that rules of procedure essential to administer justice should never be permitted to become so technical, fossilized and antiquated that they obscure the justice of the cause and lead to results that bring its administration into disrepute. In re Estate of Gottschalk, 143 Fla. 371, 196 So. 844 (1940). When one is faced with a sentence to the penitentiary for a crime he did not commit, his conviction being due solely to mistaken identity, the law should not quibble over trifles in providing a formula to correct the injustice. Ex Parte Welles, 53 So. 2d 708, 711 (Fla. 1951). If in fact the defendant has any recognized ground for post-conviction relief under Fla.R.Crim.P. 3.850, that avenue is still open to him. See: Ex Parte Welles, 53 So. 2d 708 (Fla. 1951); State v. Pitts, 241 So. 2d 399, 413-14 (Fla. 1st DCA 1970), vacated 247 So. 2d 53 (Fla. 1971), on remand 249 So. 2d 47 (Fla. 1st DCA 1971); Grant v. State, 166 So. 2d 503, 504 (Fla. 2d DCA 1964); Fla.R.Crim.P. 3.850. Affirmed. | 10-30-2013 | [
"354 So. 2d 409 (1978) Richard Lee SUNDELL, Appellant, v. The STATE of Florida, Appellee. No. 76-564. District Court of Appeal of Florida, Third District. January 17, 1978. Rehearing Denied February 17, 1978. Richard R. Snyder, Miami, for appellant. Robert L. Shevin, Atty. Gen., and Margarita G. Esquiroz, Asst. Atty. Gen., and Robert Kent Burlington, Legal Intern, for appellee. Before HUBBART and KEHOE, JJ., and CHARLES CARROLL (Ret. ), Associate Judge. *410 HUBBART, Judge.",
"The defendant Richard Lee Sundell appeals from a judgment of conviction for robbery and a twenty-five year sentence entered thereon after a finding of guilt in a non-jury trial before the Circuit Court for the Eleventh Judicial Circuit of Florida. The defendant contends on appeal that the evidence is insufficient to support the robbery conviction herein and that the case should be reversed and remanded for a new trial. Our review of the record reveals that the defendant made no motion for a judgment of acquittal and no post-trial motion for a new trial in the trial court. Accordingly, we affirm. The law of this state is well-settled that unless the issue of sufficiency of the evidence to support a verdict in a criminal case is first presented to the trial court by way of a motion for judgment of acquittal or motion for new trial, the issue is not reviewable on direct appeal from an adverse judgment. The same rule obtains notwithstanding a claim on appeal, as is true in this case, that trial counsel was inadequate or incompetent in failing to make the appropriate trial or post-trial motions.",
"There is only one exception to this rule: the Supreme Court of Florida in a capital case in which the death sentence has been imposed is empowered to make an independent review of record to determine whether the evidence is sufficient to support the verdict regardless of whether the issue was presented to the trial court by proper motion. Tibbs v. State, 337 So. 2d 788 (Fla. 1976); State v. Barber, 301 So. 2d 7 (Fla. 1974); Mancini v. State, 273 So. 2d 371 (Fla. 1973); § 921.141(4), Florida Statutes (1975). Measured by these established standards, it is clear that this court has no power to entertain the defendant's contention that the evidence is insufficient to support the verdict because it was never presented to the trial court by appropriate motion. We are without authority to entertain the issue for the first time on appeal in this non-capital case.",
"The defendant's reliance on Tibbs v. State, 337 So. 2d 788 (Fla. 1976), and Platt v. State, 65 Fla. 253, 61 So. 502 (1913) is misplaced. In both cases, the defendant was convicted of a capital crime and sentenced to death. As such, appropriate motions in the trial court attacking the sufficiency of the evidence to support the verdict were not required in order to raise the issue for the first time on appeal. Nor is Nims v. State, 70 Fla. 530, 70 So. 565 (1915), in point because there the defendant made an appropriate motion for new trial which was denied by the trial court, thus preserving the sufficiency question for appeal. And implicit in the decisions of McNeil v. State, 104 Fla. 360, 139 So. 791 (1932); Clark v. State, 98 Fla. 874, 124 So.",
"446 (1929); Fuller v. State, 92 Fla. 873, 110 So. 528 (1926); Ross v. State, 190 So. 2d 187 (Fla. 3d DCA 1966), is that appropriate motions were made at the trial level preserving the sufficiency question for appeal. We are not unmindful of the admonition that rules of procedure essential to administer justice should never be permitted to become so technical, fossilized and antiquated that they obscure the justice of the cause and lead to results that bring its administration into disrepute. In re Estate of Gottschalk, 143 Fla. 371, 196 So. 844 (1940). When one is faced with a sentence to the penitentiary for a crime he did not commit, his conviction being due solely to mistaken identity, the law should not quibble over trifles in providing a formula to correct the injustice.",
"Ex Parte Welles, 53 So. 2d 708, 711 (Fla. 1951). If in fact the defendant has any recognized ground for post-conviction relief under Fla.R.Crim.P. 3.850, that avenue is still open to him. See: Ex Parte Welles, 53 So. 2d 708 (Fla. 1951); State v. Pitts, 241 So. 2d 399, 413-14 (Fla. 1st DCA 1970), vacated 247 So. 2d 53 (Fla. 1971), on remand 249 So. 2d 47 (Fla. 1st DCA 1971); Grant v. State, 166 So. 2d 503, 504 (Fla. 2d DCA 1964); Fla.R.Crim.P. 3.850. Affirmed."
] | https://www.courtlistener.com/api/rest/v3/opinions/1691244/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Response to Amendment The Amendment filed 5/18/22 has been entered. Claims 1 and 4- 6 are amended. Claims 24- 25 are added. Claims 1- 13 and 23- 25 are pending.
Response to Arguments A second non-final has been issued because, upon further consideration, a new rejection on claim 8 and claim 23 is required.
Applicant’s arguments, see pp. 5- 6 of Remarks, filed 5/18/22 with respect to the rejection(s) of claim(s) 1 under 35 U.S.C. § 103 as being unpatentable over Eckhouse in view of Dubrul and Yodfat have been fully considered and are persuasive because Eckhouse does not disclose the newly added limitation regarding wherein the two sets of filaments of the mesh comprises extend continuously through two distinct tubular sections, a first section and a second section, the second section being comprised of two sub-sections, a first sub-section having a shape with a progressive reduction of diameter configured to open and create a space for the thrombus, and a second sub-section of a tubular uniform diameter configured to provide a connection to a catheter or to an hypotube characterized in that: said mesh of the first section has helicoidal filaments with a braiding angle configured to provide outward radial forces higher than in the second section, such that the first section becomes appositioned against the inner wall of the blood vessel in an open position. Specifically, even if the braided wall construction of control shaft 114 were considered its own set of filaments, the braided wall construction of control shaft 114 does not extend through the first section which becomes appositioned against the inner wall of the blood vessel in an open position. Therefore, the rejection has been withdrawn. However, upon further consideration, a new ground(s) of rejection is made in view of Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1). It is noted that applicant’s arguments regarding Eckhouse are directed to the continuous mesh feature, for which the newly added reference(s) are relied upon.
Claim Interpretation The following is a quotation of 35 U.S.C. 112(f): (f) Element in Claim for a Combination. – An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof.
The following is a quotation of pre-AIA 35 U.S.C. 112, sixth paragraph: An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof.
The claims in this application are given their broadest reasonable interpretation using the plain meaning of the claim language in light of the specification as it would be understood by one of ordinary skill in the art. The broadest reasonable interpretation of a claim element (also commonly referred to as a claim limitation) is limited by the description in the specification when 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, is invoked. As explained in MPEP § 2181, subsection I, claim limitations that meet the following three-prong test will be interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph: (A) the claim limitation uses the term “means” or “step” or a term used as a substitute for “means” that is a generic placeholder (also called a nonce term or a non-structural term having no specific structural meaning) for performing the claimed function; (B) the term “means” or “step” or the generic placeholder is modified by functional language, typically, but not always linked by the transition word “for” (e.g., “means for”) or another linking word or phrase, such as “configured to” or “so that”; and (C) the term “means” or “step” or the generic placeholder is not modified by sufficient structure, material, or acts for performing the claimed function. Use of the word “means” (or “step”) in a claim with functional language creates a rebuttable presumption that the claim limitation is to be treated in accordance with 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph. The presumption that the claim limitation is interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, is rebutted when the claim limitation recites sufficient structure, material, or acts to entirely perform the recited function. Absence of the word “means” (or “step”) in a claim creates a rebuttable presumption that the claim limitation is not to be treated in accordance with 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph. The presumption that the claim limitation is not interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, is rebutted when the claim limitation recites function without reciting sufficient structure, material or acts to entirely perform the recited function. Claim limitations in this application that use the word “means” (or “step”) are being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, except as otherwise indicated in an Office action. Conversely, claim limitations in this application that do not use the word “means” (or “step”) are not being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, except as otherwise indicated in an Office action. This application includes one or more claim limitations that do not use the word “means,” but are nonetheless being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, because the claim limitation(s) uses a generic placeholder that is coupled with functional language without reciting sufficient structure to perform the recited function and the generic placeholder is not preceded by a structural modifier. Such claim limitation(s) is/are: a guidance system to deploy the thrombectomy apparatus in claim 25. “A guidance system” uses the term “system” which is considered a generic placeholder that is modified by “guidance” functional language. However, the term “system” is not modified by sufficient structure, material or acts for performing the “guidance” function. Because this/these claim limitation(s) is/are being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, it/they is/are being interpreted to cover the corresponding structure described in the specification as performing the claimed function, and equivalents thereof. If applicant does not intend to have this/these limitation(s) interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, applicant may: (1) amend the claim limitation(s) to avoid it/them being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph (e.g., by reciting sufficient structure to perform the claimed function); or (2) present a sufficient showing that the claim limitation(s) recite(s) sufficient structure to perform the claimed function so as to avoid it/them being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph.
Claim Objections Claims 13 and 23 are objected to because of the following informalities: Claim 13 recites “A thrombectomy apparatus including a segment for extraction of thrombus from a blood vessel, according to claim 1”. Although understood, “a segment” should read “the segment”. Claim 23 recites “a composite comprising Nitinol/Platinum”. Although it is clear in view of the disclosure that the composition comprises “Nitinol and Platinum” it is suggested that applicant amend accordingly since a “/” can be considered to mean both “and” and “or” and “and/or”. Appropriate correction is required.
Claim Rejections - 35 USC § 112 The following is a quotation of 35 U.S.C. 112(b): (b) CONCLUSION.—The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the inventor or a joint inventor regards as the invention.
The following is a quotation of 35 U.S.C. 112 (pre-AIA ), second paragraph: The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention.
Claims 8 and 23 are rejected under 35 U.S.C. 112(b) or 35 U.S.C. 112 (pre-AIA ), second paragraph, as being indefinite for failing to particularly point out and distinctly claim the subject matter which the inventor or a joint inventor (or for applications subject to pre-AIA 35 U.S.C. 112, the applicant), regards as the invention. Claim 8 recites the limitation "the coating" in line 1. There is insufficient antecedent basis for this limitation in the claim. It is not clear whether applicant intended to introduce - - [[the]] a coating - - in claim 8 or whether applicant intended to depend claim 8 from claim 4 - -The device of claim [[7]] 4, wherein the coating comprises a polymer including silicone or polyurethane - -, or similarly from claim 3. For the purposes of examination, claim 8, line 1 is interpreted as - - [[the]] a coating - -. Claim 23 recites “a percentage of Platinum from 10% to 40%.”. It is unclear as if the percentage recited is by weight, volume, etc., thus the claimed limitations are unclear. Applicant is reminded that in amending the claims, that there must be support in the disclosure as originally filed.
Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
Claim(s) 1- 5, 7- 8 and 12- 13 is/are rejected under 35 U.S.C. 103 as being unpatentable over Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1).
PNG media_image1.png 587 901 media_image1.png Greyscale
Regarding claims 1 - 2, Panian discloses a device (500) (Figs. 5A- 5B) for extraction of thrombus from a blood vessel (P. [0093] - - Such larger aperture on the distal end 507 of the tubular member 501 significantly improves the efficacy of blood clot removal), said device (500) comprising a segment (503) (Figs. 5A- 5B) defining a distal end and a proximal end and being configured to change its shape from a retracted position in a compressed state (described, not shown) (P. [0096] - - collapsed configuration) to an extended and expanded position (Fig. 5A), to receive and retain a thrombus, wherein the segment (503) is formed by a mesh (508) (P. [0093] - - as a mesh is an interwoven or intertwined structure, the tubular braid 508 disclosed by Panian encompasses a mesh as claimed) (Figs. 5A- 5B) of at least two sets of helicoidal filaments turning respectively in opposite directions and being intertwined (P. [0097] - - the braid may have… a variety of wire configurations including two wires on two wires (2/2) and other suitable combinations), and wherein the two sets of filaments of the mesh (508) extend continuously through two distinct tubular sections, a first section (S1) (See Annotated Fig. 5B - - left of the first dashed line, D1) and a second section (S2) (See Annotated Fig. 5B - - right of the first dashed line, D1), the second section (S2) being comprised of two sub-sections, a first sub-section (SS1) (See Annotated Fig. 5B - - left of the second dashed line, D2) having a shape with a progressive reduction of diameter configured to open and create a space for the thrombus (Ps. [0092]- [0094] - - expandable tip 503 has a funneled or conical configuration for clot retrieval), and a second sub-section (SS2) (See Annotated Fig. 5B - - right of second dashed line, D2) of a tubular uniform diameter configured to provide a connection to a catheter or to an hypotube (504); characterized in that: said mesh of the first sub-section of the second section (SS1) has a conical shape and comprises a braiding angle that changes at its proximal and distal ends to provide outward radial strength to maintain the conical shape and to maintain the open position of the first section (S1) (See Annotated Fig. 5B; as shown the braid expands in size, and thus the braid angle would necessarily change as the same wires are used to cover a larger volume) (Ps. [0093], [0095], [0096] - -the very distal end 507 has an aperture 510 that has a larger diameter than the diameter of the main body 504. The tubular braid 508 angle (angle between two crossing filaments of the braid—not shown) plays an important role of easing the expanding braid; since the braid angle eases the expansion into the funneled or conical configuration, the braid angle would have yielded predictable or expected outward radial strength sufficient to maintain the conical shape and to maintain the open position of the first section (S1)). In view of the above, the claimed limitations are considered encompassed or at least obvious over the teachings of the prior art; to form the product of the prior art as shown and disclosed would have been obvious and well within the purview of one of ordinary skill in the art. Panian does not expressly disclose (claim 1) a first section with a braiding angle configured to provide outward radial forces higher than in the second section and configured to be appositioned against the inner wall of the blood vessel as claimed; (claim 2) closed loops as claimed; However, Harari teaches a device for extraction of thrombus from a blood vessel in the same field of endeavor (P. [0044]) having a segment formed by a mesh or elongated braid structure including a plurality of helically wound wires crossing a plurality of counter-helically wound wires (P. [0011]) having a first section (S1) (See Annotated Fig. 2A- - left of dashed line) and a second section (S2) (See Annotated Fig. 2A - - right of dashed line)
PNG media_image2.png 740 908 media_image2.png Greyscale
(claim 1) said mesh of the first section (S1) has helicoidal filaments with a braiding angle configured to provide outward radial forces higher than in the second section (S2), such that the first section (S2) becomes appositioned against the inner wall of the blood vessel in an open position (See Fig. 3C) (Ps. [0061], [0091], [0102], [0104] - - braid structure 12 includes wires 30, each wire 30 forming loops 32 in the first section (S1) that flare or angle outward 10- 30 degrees and wires 30 are counter-wound in a helical pattern in a distal to proximal direction, forming the mesh; the expanded diameter of elongated braid structure 12 is configured slightly larger than that of the blood vessel throughout its length or at loops 32. This ensures a tight seal between elongated braid structure 12 and the vessel walls and occlusion of blood flow). In view of the above, the claimed limitations are considered encompassed or at least obvious over the teachings of the prior art; to form the product of the prior art as shown and disclosed would have been obvious and well within the purview of one of ordinary skill in the art; (claim 2) wherein the first section (S1) comprises closed loops (32) (Figs. 2A- 2B) at the distal end configured to act as a spring, such that the radial forces in first and second end portions of the first section (S1) are higher than in an intermediate portion thereof (P. [0091] - - each wire 30 is made of an alloy such as NITINOL and forms a loop 32; since Panian in view of Harari discloses a first section (S1) comprising closed loops (32) made from a superelastic, shape memory alloy such as NITINOL and since, according to applicant’s Specification as best understood, the radial forces in the end portions of the first section 20 are particularly higher than in an intermediate portion thereof because of the spring action of closed loops 23, also made of NITINOL (See applicant’s Specification at p. 3, l. 26- 29, p. 8, l. 21- 23 and p. 9, l. 21- 23), Panian in view of Harari encompasses or at least make obvious radial forces in the first and second end portions of the first section (S1) are higher than in an intermediate portion thereof) It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to substitute the first section (S1) having helicoidal filaments with a braiding angle configured to provide outward radial forces higher than in the second section (S2), such that the first section (S2) becomes appositioned against the inner wall of the blood vessel in an open position and wherein the first section (S1) comprises closed loops and as taught by Harari for the first section associated with Panian because it would provide a flared or angled outward first section that maximizes the outward torque on the first section distal end (Harari - - Ps. [0061], [0068], [0104]). The motivation for the substitution would have been to provide a mesh with an expanded diameter first section (S1) larger than that of the blood vessel to ensure a tight seal between elongated braid structure 12 and the vessel walls and occlusion of blood flow (Harari - - P. [0102]). Thus the limitations of claims 1 and 2 are at least obvious over the teachings of the prior art. Regarding claim 3, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing wherein the segment further comprises a coating (509) (Fig. 5B) covering at least the first section (S1) (P. [0093] - - expandable tip 503 can be made of a tubular braid 508, is coated and has its complete surface covered with silicone 509, as shown in FIG. 5B). Regarding claim 4, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing wherein the segment (503) further comprises a coating (509) (Fig. 5B) covering at least the first sub-section of the second section (SS1) (See Annotated Fig. 1) (P. [0093] - - coated and has its complete surface covered with silicone 509, as shown in FIG. 5B). Regarding claim 5, Panian in view of Harari discloses the apparatus of claim 4, Panian further disclosing wherein the coating (509) is a non-permeable coating (As Panian teaches P. [0094] - - the space or voids within the braid 508 are filled up and covered with silicone 509, thus creating a shield that prevents penetration and suction of blood clots through the outer surface of the expandable tip 503 the coating taught is understood to be non-permeable). Regarding claim 7, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing wherein the helicoidal filaments of the mesh (508) are made of a metal, a metal alloy or a composite including Nitinol or Nitinol/Platinum (P. [0095] - - The tubular braid 508 may be made of a plurality of wires…made of metals, alloys, polymers, Nitinol, cobalt-chromium alloys, Platinum, Platinum-Iridium alloys, polymers or combinations thereof). Regarding claim 8 in view of the rejection under 35 U.S.C. §112(b), Panian in view of Harari discloses the apparatus of claim 7, Panian further disclosing wherein the coating (509) (Fig. 5B) comprises a polymer including silicone (P. [0094] - - the space or voids within the braid 508 are filled up and covered with silicone 509). Regarding claim 12, Panian in view of Harari disclose the apparatus of claim 1, Panian does not disclose sensors as claimed. However, Harari teaches a device for extraction of thrombus from a blood vessel in the same field of endeavor (P. [0044]) having a segment (12) (Figs. 1A- 2C) formed by a mesh or elongated braid structure including a plurality of helically wound wires crossing a plurality of counter-helically wound wires (P. [0011]) having a first section (S1) (See Annotated Fig. 2A) and a second section (S2) (See Annotated Fig. 2A) (claim 12) wherein the segment (12) further comprises one or more sensors included or attached thereto to provide information thereof including information about the position of the segment in relation to the blood vessel, on whether the segment is in the retracted position or in the extended and expanded position, on whether the segment is well extended, or about the radial forces (P. [0097] - - Elongated braid structure 12 can also include radio-opaque markers (e.g. gold, Platinum or Tantalum) that allow an operator to identify the location of the funnel prior to expansion and during retrieval using fluoroscopy). It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to modify the mesh of Panian to include one or more sensors as taught by Harari because it would allow an operator to identify the location of the segment prior to expansion and during retrieval using fluoroscopy (Harari- -P. [0097]). Regarding claim 13, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing a thrombectomy apparatus including a segment for extraction of thrombus from a blood vessel, according to claim 1 (See rejection of claim 1 above) (P. [0003] - - aspiration for stroke thrombectomy is disclosed).
Claim(s) 6 and 24 is/are rejected under 35 U.S.C. 103 as being unpatentable over Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 4 above, and in further view of Diamant et al. (US Pub. No. 2013/0261638 A1). Regarding claim 6, Panian in view of Harari disclose the apparatus of claim 4, Panian in view of Harari does not disclose (claim 6) wherein the coating has holes as claimed; However, Diamant teaches a device (40, 90, 100) (Figs. 4, 9, 10) including a frame (42) (Figs. 4, 9, 10) comprising filaments and a coating (43) (Figs. 4, 9, 10) for extraction of thrombus from a blood vessel in the same field of endeavor (P. [0018], [0055]), Diamant further teaching (claim 6) wherein the coating (43) comprises holes (P. [0116] - - cover film 43 can have one or more holes of a predetermined size, e.g. between 5 micron and 200 microns (or even greater) for the passage of blood flow when the device is in a blood vessel). Diamant further discloses that a non-permeable coating and a coating having one or more holes of a predetermined size perform the same function of enhancing the aspiration properties of the thrombus extracting device (Diamant - - Ps. [0116], [0135]). Thus, it would have been obvious to one having ordinary skill in the art before the effective filing date of the claimed invention to substitute one known element (coating comprising holes) for another (non-permeable coating) in order to achieve maintain enhanced aspiration while allowing for the passage of blood as taught by Diamant. Regarding claim 24, Panian in view of Harari discloses the apparatus of claim 4, wherein the coating is disclosed over the complete surface of the expandable tip (503) ([Panian 0093]). The references are not specific to at least a proximal portion of the second subsection as uncoated, however, as discussed above, it would have been obvious to one having ordinary skill in the art before the effective filing date of the claimed invention to substitute one known element (coating comprising holes) for another (non-permeable coating) in order to achieve maintain enhanced aspiration while allowing for the passage of blood as taught by Diamant. As the coating has holes, the portion of the coating with holes would necessarily leave a portion of the element uncoated. Thus, the claimed limitation, wherein at least a proximal portion of the second subsection is uncoated is considered obvious over the teachings of the prior art. It is noted that the claimed limitation is to “a proximal portion” and does not require an entire section or end to be uncoated. Claims 9- 11 is/are rejected under 35 U.S.C. 103 as being unpatentable Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 1 above, and in further view of Yodfat et al. (US Pub. No. 2004/0024416 A1). Yodfat was cited in the Non-Final Office Action, mailed 3/03/22. Regarding claim 9, Panian in view of Harari teach the apparatus of claim 1, Panian disclosing a small braid angle of less than 30 degrees in the collapsed configuration and less than 70 degrees in the expanded configuration (Panian - - P. [0096] and Harari disclosing 6- 24 wires 0.025-0.1 mm in diameter, the helically wound wires counter helically wound at an angle of 70- 120 degrees (Harari - - Ps. [0012], [0091]), but Panian in view of Harari does not expressly disclose wherein: the helicoidal filaments comprise a number ranging between 24 and 48, said filaments having a cross section comprised in a range between 40 and 60 µm; and the braiding angle of the helicoidal filaments with regard to a longitudinal axis of the segment is comprised between 50 and 65 degrees for the first section, and between 15 and 50 for the second sub-section. However, Yodfat teaches a braided tubular body having a variable pitch mesh that directs blood flow containing embolic material by blocking or reducing partially or substantially totally the blood flow in the same field of endeavor, Yodfat teaching (claim 9) the helicoidal filaments comprise a number ranging between 24 and 48 (P. [0026] - - 40 to 160 of filaments falls within the claimed range), said filaments having a cross section comprised in a range between 40 and 60 µm (P. [0027] - - 10-50 µm falls within the claimed range). It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to modify the mesh braid associated with Panian in view of Harari to include helicoidal filaments comprising a number ranging between 24 and 48, said filaments having a cross section comprised in a range between 40 and 60 µm since tubular braid formation is well known in the art, such that the number and size of filaments taught by Yodfat would have yielded predictable results, namely, forming a typical self-expanding braided filaments for use in the vasculature (Yodfat - - Ps. [0026]- [0027]). Yodfat additionally sets forth that the braiding angle is a result effective variable, wherein the larger the value of the braiding angle, the greater the radial force it provides, and hence the greater the strength of the resulting structure (P. [0093]). It would have been obvious to one having ordinary skill in the art at the time the invention was made to modify the braiding angle for the first section to be between 50 and 65 degrees and the braiding angle for the second sub-section to be between 15 and 50 for the purpose of providing for greater or lesser mechanical strength/outward radial force of a specific section of the device, since it has been held that where the general conditions of a claim are disclosed in the prior art, discovering the optimum or workable ranges involves only routine skill in the art. In re Aller, 105 USPQ 233. Regarding claim 10, Panian in view of Harari teach the apparatus of claim 1, Panian disclosing a mall braid angle of less than 30 degrees in the collapsed configuration and less than 70 degrees in the expanded configuration (Panian - - P. [0096] and Harari disclosing 6- 24 wires 0.025-0.1 mm in diameter, the helically wound wires counter helically wound at an angle of 70- 120 degrees and a length of the expandable braid structure being 10- 60 mm or 20- 40 mm (Harari - - Ps. [0012], [0054], [0091]), but Panian in view of Harari does not expressly disclose wherein: the first section comprises a length ranging between 4 and 40 millimeters and the second sub-section comprises a length ranging between 1 and 10 millimeters; and the first section comprises an outer diameter ranging between 3.5 and 6 millimeters and the second sub-section comprises an outer diameter ranging between 1 and 2 millimeters. However, Yodfat teaches a braided tubular body having a variable pitch mesh that directs blood flow containing embolic material by blocking or reducing partially or substantially totally the blood flow in the same field of endeavor, Yodfat teaching The length "L" of the device will vary according to the intended location and use, and anatomical position, and is typically between 20 mm and 150 mm (P. [0073]), the diameter "d" of the device in the human body is 3-30 mm (P. [0066]), and in the case of the conical shaped device, the different diameters at the two extremities of the device, have a difference can be of the order of 3-5 mm. Yodfat additionally sets forth that the dimensions of the conical shaped device are result effective variables that are a function of the final desired dimensions (P. [0067]). It would have been obvious to one having ordinary skill in the art at the time the invention was made to modify the dimensions of the mesh associated with Panian in view of Harari such that the first section comprises a length ranging between 4 and 40 millimeters and the second sub-section comprises a length ranging between 1 and 10 millimeters; and the first section comprises an outer diameter ranging between 3.5 and 6 millimeters and the second sub-section comprises an outer diameter ranging between 1 and 2 millimeters for the purpose of providing desired dimensions for anchoring the claimed funnel mesh, since it has been held that where the general conditions of a claim are disclosed in the prior art, discovering the optimum or workable ranges involves only routine skill in the art. In re Aller, 105 USPQ 233. Regarding claim 11, Panian in view of Harari teach the apparatus of claim 1, Panian disclosing a small braid angle of less than 30 degrees in the collapsed configuration and less than 70 degrees in the expanded configuration (Panian - - P. [0096] and Harari disclosing 6- 24 wires 0.025-0.1 mm in diameter, the helically wound wires counter helically wound at an angle of 70- 120 degrees (Harari - - Ps. [0012], [0091]), but Panian in view of Harari does not expressly disclose wherein the braiding angle of the first sub- section is comprised between 15 and 45 degrees with regard to a longitudinal axis of the segment. However, Yodfat teaches a braided tubular body having a variable pitch mesh that directs blood flow containing embolic material by blocking or reducing partially or substantially totally the blood flow in the same field of endeavor, Yodfat teaching Yodfat additionally sets forth that the braiding angle is a result effective variable, wherein the larger the value of the braiding angle, the greater the radial force it provides, and hence the greater the strength of the resulting structure (P. [0093]). It would have been obvious to one having ordinary skill in the art at the time the invention was made to modify the braiding angle for the first sub-section of the mesh associated with Panian in view of Harari to be between 15 and 45 degrees for the purpose of providing for greater or lesser mechanical strength of a specific section of the device, since it has been held that where the general conditions of a claim are disclosed in the prior art, discovering the optimum or workable ranges involves only routine skill in the art. In re Aller, 105 USPQ 233.
Claim 23 is/are rejected under 35 U.S.C. 103 as being unpatentable over Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 7 above, and further in view of Eckhouse et al. (US Pub. No. 2015/0327866 A1). Regarding claim 23, Panian in view of Harari discloses the apparatus of claim 7, but Panian in view of Harari does not expressly disclose (claim 23) wherein the helicoidal filaments of the mesh are made of a composite comprising Nitinol/Platinum with a percentage of Platinum from 10% to 40% as claimed. However, Eckhouse teaches deploying an expandable device comprised of a mesh made of a controllable fine wire construction (405) into a blood vessel (Ps. [0007], [0044], [0046]) (claim 23) wherein the helicoidal filaments of the mesh are made of a composite comprising Nitinol/Platinum with a percentage of Platinum from 10% to 40% (P. [0075] - - the expandable member can include a plurality of Nitinol wires with a core made of Tantalum or Platinum metals. The radiopaque core can be 20% to 50% by volume (e.g. 30% or 40%; it is noted that 30% or 40% falls within the claimed range). It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to modify the filaments associated with Panian in view of Harari to comprise a composite comprising Nitinol and Platinum with a percentage of Platinum from 20% to 50% as taught by Eckhouse because it would allow a user to visualize the expandable member with angiographic imaging (Eckhouse - - P. [0075]). Thus, the claimed limitations are considered obvious in view of the teachings of the prior art and the 112 rejection above.
Claim(s) 25 is/are rejected under 35 U.S.C. 103 as being unpatentable over Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 13 above, and further in view of Ribo Jacobi et al. (US Pub. No. 2017/0303949 A1). Regarding claim 25, Panian in view of Harari disclose the apparatus of claim 13, but Panian in view of Harari does not disclose (claim 25) an automated system as claimed. However, Ribo Jacobi teaches a thrombectomy system in the same field of endeavor (Abstract) including (claim 25) A system configured for automated maneuvering of the thrombectomy apparatus of claim 13 to the blood vessel, the system comprising an automated proximal device configured to provide a guidance system to deploy the thrombectomy apparatus, an imaging device, a communications channel, a control module configured to allow for guidance of the deployment of the thrombectomy apparatus, a data storage device, and a computer assisted controller configured to guide the control module (See Fig. 8) (Ps. [0038], [0066], [0070] - - said system can also comprise an imaging device…indicating the location of the distal end of the funnel, and…indicating the location of the vascular thrombus, and a computer assisted controller; FIG. 8 depicts a thrombectomy device of the present invention which allows for the automated maneuvering of the thrombectomy device through a vascular system; since positioning and operation of the device is assisted by fluoroscopy, Ribo Jacobi discloses a guidance system which is interpreted under 35 U.S.C. § 112(f) as a structural equivalent of the guidance system associated with (See applicant’s Specification at p. 18, l. 28- 32 describing advancing applicant’s invention under fluoroscopic guidance). It would have been obvious to one having ordinary skill in the art to automate device for extraction of thrombus associated with Panian in view of Harari with the automated system taught by Ribo Jacobi since providing an automatic or mechanical means to replace a manual activity which accomplished the same result is not sufficient to distinguish over the prior art. In re Venner, 262 F.2d 91, 95, 120 USPQ 193, 194 (CCPA 1958; MPEP 2144.04 (III).
Conclusion The prior art made of record and not relied upon is considered pertinent to applicant's disclosure includes: Lowinger et al. (US Pub. No. 2017/0215900 A1).
Any inquiry concerning this communication or earlier communications from the examiner should be directed to KANKINDI RWEGO whose telephone number is (303)297-4759. The examiner can normally be reached Monday- Friday: 10:00- 5:00 MT. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Kelly Bekker can be reached on 571 272-2739. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of published or unpublished applications may be obtained from Patent Center. Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format. For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
/KANKINDI RWEGO/Examiner, Art Unit 3771 /KELLY J BEKKER/Supervisory Patent Examiner, Art Unit 3771 | 2022-07-24T22:06:07 | [
"DETAILED ACTION Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . Response to Amendment The Amendment filed 5/18/22 has been entered. Claims 1 and 4- 6 are amended. Claims 24- 25 are added. Claims 1- 13 and 23- 25 are pending. Response to Arguments A second non-final has been issued because, upon further consideration, a new rejection on claim 8 and claim 23 is required. Applicant’s arguments, see pp. 5- 6 of Remarks, filed 5/18/22 with respect to the rejection(s) of claim(s) 1 under 35 U.S.C. § 103 as being unpatentable over Eckhouse in view of Dubrul and Yodfat have been fully considered and are persuasive because Eckhouse does not disclose the newly added limitation regarding wherein the two sets of filaments of the mesh comprises extend continuously through two distinct tubular sections, a first section and a second section, the second section being comprised of two sub-sections, a first sub-section having a shape with a progressive reduction of diameter configured to open and create a space for the thrombus, and a second sub-section of a tubular uniform diameter configured to provide a connection to a catheter or to an hypotube characterized in that: said mesh of the first section has helicoidal filaments with a braiding angle configured to provide outward radial forces higher than in the second section, such that the first section becomes appositioned against the inner wall of the blood vessel in an open position. Specifically, even if the braided wall construction of control shaft 114 were considered its own set of filaments, the braided wall construction of control shaft 114 does not extend through the first section which becomes appositioned against the inner wall of the blood vessel in an open position.",
"Therefore, the rejection has been withdrawn. However, upon further consideration, a new ground(s) of rejection is made in view of Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1). It is noted that applicant’s arguments regarding Eckhouse are directed to the continuous mesh feature, for which the newly added reference(s) are relied upon.",
"Claim Interpretation The following is a quotation of 35 U.S.C. 112(f): (f) Element in Claim for a Combination. – An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof. The following is a quotation of pre-AIA 35 U.S.C. 112, sixth paragraph: An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof. The claims in this application are given their broadest reasonable interpretation using the plain meaning of the claim language in light of the specification as it would be understood by one of ordinary skill in the art.",
"The broadest reasonable interpretation of a claim element (also commonly referred to as a claim limitation) is limited by the description in the specification when 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, is invoked. As explained in MPEP § 2181, subsection I, claim limitations that meet the following three-prong test will be interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph: (A) the claim limitation uses the term “means” or “step” or a term used as a substitute for “means” that is a generic placeholder (also called a nonce term or a non-structural term having no specific structural meaning) for performing the claimed function; (B) the term “means” or “step” or the generic placeholder is modified by functional language, typically, but not always linked by the transition word “for” (e.g., “means for”) or another linking word or phrase, such as “configured to” or “so that”; and (C) the term “means” or “step” or the generic placeholder is not modified by sufficient structure, material, or acts for performing the claimed function. Use of the word “means” (or “step”) in a claim with functional language creates a rebuttable presumption that the claim limitation is to be treated in accordance with 35 U.S.C.",
"112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph. The presumption that the claim limitation is interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, is rebutted when the claim limitation recites sufficient structure, material, or acts to entirely perform the recited function. Absence of the word “means” (or “step”) in a claim creates a rebuttable presumption that the claim limitation is not to be treated in accordance with 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph. The presumption that the claim limitation is not interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, is rebutted when the claim limitation recites function without reciting sufficient structure, material or acts to entirely perform the recited function. Claim limitations in this application that use the word “means” (or “step”) are being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C.",
"112, sixth paragraph, except as otherwise indicated in an Office action. Conversely, claim limitations in this application that do not use the word “means” (or “step”) are not being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, except as otherwise indicated in an Office action. This application includes one or more claim limitations that do not use the word “means,” but are nonetheless being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, because the claim limitation(s) uses a generic placeholder that is coupled with functional language without reciting sufficient structure to perform the recited function and the generic placeholder is not preceded by a structural modifier. Such claim limitation(s) is/are: a guidance system to deploy the thrombectomy apparatus in claim 25. “A guidance system” uses the term “system” which is considered a generic placeholder that is modified by “guidance” functional language. However, the term “system” is not modified by sufficient structure, material or acts for performing the “guidance” function.",
"Because this/these claim limitation(s) is/are being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, it/they is/are being interpreted to cover the corresponding structure described in the specification as performing the claimed function, and equivalents thereof. If applicant does not intend to have this/these limitation(s) interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph, applicant may: (1) amend the claim limitation(s) to avoid it/them being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph (e.g., by reciting sufficient structure to perform the claimed function); or (2) present a sufficient showing that the claim limitation(s) recite(s) sufficient structure to perform the claimed function so as to avoid it/them being interpreted under 35 U.S.C. 112(f) or pre-AIA 35 U.S.C. 112, sixth paragraph. Claim Objections Claims 13 and 23 are objected to because of the following informalities: Claim 13 recites “A thrombectomy apparatus including a segment for extraction of thrombus from a blood vessel, according to claim 1”. Although understood, “a segment” should read “the segment”.",
"Claim 23 recites “a composite comprising Nitinol/Platinum”. Although it is clear in view of the disclosure that the composition comprises “Nitinol and Platinum” it is suggested that applicant amend accordingly since a “/” can be considered to mean both “and” and “or” and “and/or”. Appropriate correction is required. Claim Rejections - 35 USC § 112 The following is a quotation of 35 U.S.C. 112(b): (b) CONCLUSION.—The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the inventor or a joint inventor regards as the invention. The following is a quotation of 35 U.S.C. 112 (pre-AIA ), second paragraph: The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention. Claims 8 and 23 are rejected under 35 U.S.C. 112(b) or 35 U.S.C. 112 (pre-AIA ), second paragraph, as being indefinite for failing to particularly point out and distinctly claim the subject matter which the inventor or a joint inventor (or for applications subject to pre-AIA 35 U.S.C.",
"112, the applicant), regards as the invention. Claim 8 recites the limitation \"the coating\" in line 1. There is insufficient antecedent basis for this limitation in the claim. It is not clear whether applicant intended to introduce - - [[the]] a coating - - in claim 8 or whether applicant intended to depend claim 8 from claim 4 - -The device of claim [[7]] 4, wherein the coating comprises a polymer including silicone or polyurethane - -, or similarly from claim 3. For the purposes of examination, claim 8, line 1 is interpreted as - - [[the]] a coating - -. Claim 23 recites “a percentage of Platinum from 10% to 40%.”.",
"It is unclear as if the percentage recited is by weight, volume, etc., thus the claimed limitations are unclear. Applicant is reminded that in amending the claims, that there must be support in the disclosure as originally filed. Claim Rejections - 35 USC § 103 The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action: A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made. Claim(s) 1- 5, 7- 8 and 12- 13 is/are rejected under 35 U.S.C.",
"103 as being unpatentable over Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1). PNG media_image1.png 587 901 media_image1.png Greyscale Regarding claims 1 - 2, Panian discloses a device (500) (Figs. 5A- 5B) for extraction of thrombus from a blood vessel (P. [0093] - - Such larger aperture on the distal end 507 of the tubular member 501 significantly improves the efficacy of blood clot removal), said device (500) comprising a segment (503) (Figs. 5A- 5B) defining a distal end and a proximal end and being configured to change its shape from a retracted position in a compressed state (described, not shown) (P. [0096] - - collapsed configuration) to an extended and expanded position (Fig. 5A), to receive and retain a thrombus, wherein the segment (503) is formed by a mesh (508) (P. [0093] - - as a mesh is an interwoven or intertwined structure, the tubular braid 508 disclosed by Panian encompasses a mesh as claimed) (Figs. 5A- 5B) of at least two sets of helicoidal filaments turning respectively in opposite directions and being intertwined (P. [0097] - - the braid may have… a variety of wire configurations including two wires on two wires (2/2) and other suitable combinations), and wherein the two sets of filaments of the mesh (508) extend continuously through two distinct tubular sections, a first section (S1) (See Annotated Fig. 5B - - left of the first dashed line, D1) and a second section (S2) (See Annotated Fig.",
"5B - - right of the first dashed line, D1), the second section (S2) being comprised of two sub-sections, a first sub-section (SS1) (See Annotated Fig. 5B - - left of the second dashed line, D2) having a shape with a progressive reduction of diameter configured to open and create a space for the thrombus (Ps. [0092]- [0094] - - expandable tip 503 has a funneled or conical configuration for clot retrieval), and a second sub-section (SS2) (See Annotated Fig. 5B - - right of second dashed line, D2) of a tubular uniform diameter configured to provide a connection to a catheter or to an hypotube (504); characterized in that: said mesh of the first sub-section of the second section (SS1) has a conical shape and comprises a braiding angle that changes at its proximal and distal ends to provide outward radial strength to maintain the conical shape and to maintain the open position of the first section (S1) (See Annotated Fig.",
"5B; as shown the braid expands in size, and thus the braid angle would necessarily change as the same wires are used to cover a larger volume) (Ps. [0093], [0095], [0096] - -the very distal end 507 has an aperture 510 that has a larger diameter than the diameter of the main body 504. The tubular braid 508 angle (angle between two crossing filaments of the braid—not shown) plays an important role of easing the expanding braid; since the braid angle eases the expansion into the funneled or conical configuration, the braid angle would have yielded predictable or expected outward radial strength sufficient to maintain the conical shape and to maintain the open position of the first section (S1)).",
"In view of the above, the claimed limitations are considered encompassed or at least obvious over the teachings of the prior art; to form the product of the prior art as shown and disclosed would have been obvious and well within the purview of one of ordinary skill in the art. Panian does not expressly disclose (claim 1) a first section with a braiding angle configured to provide outward radial forces higher than in the second section and configured to be appositioned against the inner wall of the blood vessel as claimed; (claim 2) closed loops as claimed; However, Harari teaches a device for extraction of thrombus from a blood vessel in the same field of endeavor (P. [0044]) having a segment formed by a mesh or elongated braid structure including a plurality of helically wound wires crossing a plurality of counter-helically wound wires (P. [0011]) having a first section (S1) (See Annotated Fig. 2A- - left of dashed line) and a second section (S2) (See Annotated Fig. 2A - - right of dashed line) PNG media_image2.png 740 908 media_image2.png Greyscale (claim 1) said mesh of the first section (S1) has helicoidal filaments with a braiding angle configured to provide outward radial forces higher than in the second section (S2), such that the first section (S2) becomes appositioned against the inner wall of the blood vessel in an open position (See Fig.",
"3C) (Ps. [0061], [0091], [0102], [0104] - - braid structure 12 includes wires 30, each wire 30 forming loops 32 in the first section (S1) that flare or angle outward 10- 30 degrees and wires 30 are counter-wound in a helical pattern in a distal to proximal direction, forming the mesh; the expanded diameter of elongated braid structure 12 is configured slightly larger than that of the blood vessel throughout its length or at loops 32. This ensures a tight seal between elongated braid structure 12 and the vessel walls and occlusion of blood flow). In view of the above, the claimed limitations are considered encompassed or at least obvious over the teachings of the prior art; to form the product of the prior art as shown and disclosed would have been obvious and well within the purview of one of ordinary skill in the art; (claim 2) wherein the first section (S1) comprises closed loops (32) (Figs.",
"2A- 2B) at the distal end configured to act as a spring, such that the radial forces in first and second end portions of the first section (S1) are higher than in an intermediate portion thereof (P. [0091] - - each wire 30 is made of an alloy such as NITINOL and forms a loop 32; since Panian in view of Harari discloses a first section (S1) comprising closed loops (32) made from a superelastic, shape memory alloy such as NITINOL and since, according to applicant’s Specification as best understood, the radial forces in the end portions of the first section 20 are particularly higher than in an intermediate portion thereof because of the spring action of closed loops 23, also made of NITINOL (See applicant’s Specification at p. 3, l. 26- 29, p. 8, l. 21- 23 and p. 9, l. 21- 23), Panian in view of Harari encompasses or at least make obvious radial forces in the first and second end portions of the first section (S1) are higher than in an intermediate portion thereof) It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to substitute the first section (S1) having helicoidal filaments with a braiding angle configured to provide outward radial forces higher than in the second section (S2), such that the first section (S2) becomes appositioned against the inner wall of the blood vessel in an open position and wherein the first section (S1) comprises closed loops and as taught by Harari for the first section associated with Panian because it would provide a flared or angled outward first section that maximizes the outward torque on the first section distal end (Harari - - Ps. [0061], [0068], [0104]).",
"The motivation for the substitution would have been to provide a mesh with an expanded diameter first section (S1) larger than that of the blood vessel to ensure a tight seal between elongated braid structure 12 and the vessel walls and occlusion of blood flow (Harari - - P. [0102]). Thus the limitations of claims 1 and 2 are at least obvious over the teachings of the prior art. Regarding claim 3, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing wherein the segment further comprises a coating (509) (Fig. 5B) covering at least the first section (S1) (P. [0093] - - expandable tip 503 can be made of a tubular braid 508, is coated and has its complete surface covered with silicone 509, as shown in FIG. 5B). Regarding claim 4, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing wherein the segment (503) further comprises a coating (509) (Fig.",
"5B) covering at least the first sub-section of the second section (SS1) (See Annotated Fig. 1) (P. [0093] - - coated and has its complete surface covered with silicone 509, as shown in FIG. 5B). Regarding claim 5, Panian in view of Harari discloses the apparatus of claim 4, Panian further disclosing wherein the coating (509) is a non-permeable coating (As Panian teaches P. [0094] - - the space or voids within the braid 508 are filled up and covered with silicone 509, thus creating a shield that prevents penetration and suction of blood clots through the outer surface of the expandable tip 503 the coating taught is understood to be non-permeable). Regarding claim 7, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing wherein the helicoidal filaments of the mesh (508) are made of a metal, a metal alloy or a composite including Nitinol or Nitinol/Platinum (P. [0095] - - The tubular braid 508 may be made of a plurality of wires…made of metals, alloys, polymers, Nitinol, cobalt-chromium alloys, Platinum, Platinum-Iridium alloys, polymers or combinations thereof).",
"Regarding claim 8 in view of the rejection under 35 U.S.C. §112(b), Panian in view of Harari discloses the apparatus of claim 7, Panian further disclosing wherein the coating (509) (Fig. 5B) comprises a polymer including silicone (P. [0094] - - the space or voids within the braid 508 are filled up and covered with silicone 509). Regarding claim 12, Panian in view of Harari disclose the apparatus of claim 1, Panian does not disclose sensors as claimed. However, Harari teaches a device for extraction of thrombus from a blood vessel in the same field of endeavor (P. [0044]) having a segment (12) (Figs. 1A- 2C) formed by a mesh or elongated braid structure including a plurality of helically wound wires crossing a plurality of counter-helically wound wires (P. [0011]) having a first section (S1) (See Annotated Fig. 2A) and a second section (S2) (See Annotated Fig. 2A) (claim 12) wherein the segment (12) further comprises one or more sensors included or attached thereto to provide information thereof including information about the position of the segment in relation to the blood vessel, on whether the segment is in the retracted position or in the extended and expanded position, on whether the segment is well extended, or about the radial forces (P. [0097] - - Elongated braid structure 12 can also include radio-opaque markers (e.g.",
"gold, Platinum or Tantalum) that allow an operator to identify the location of the funnel prior to expansion and during retrieval using fluoroscopy). It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to modify the mesh of Panian to include one or more sensors as taught by Harari because it would allow an operator to identify the location of the segment prior to expansion and during retrieval using fluoroscopy (Harari- -P. [0097]). Regarding claim 13, Panian in view of Harari discloses the apparatus of claim 1, Panian further disclosing a thrombectomy apparatus including a segment for extraction of thrombus from a blood vessel, according to claim 1 (See rejection of claim 1 above) (P. [0003] - - aspiration for stroke thrombectomy is disclosed). Claim(s) 6 and 24 is/are rejected under 35 U.S.C. 103 as being unpatentable over Panian (US Pub. No.",
"2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 4 above, and in further view of Diamant et al. (US Pub. No. 2013/0261638 A1). Regarding claim 6, Panian in view of Harari disclose the apparatus of claim 4, Panian in view of Harari does not disclose (claim 6) wherein the coating has holes as claimed; However, Diamant teaches a device (40, 90, 100) (Figs. 4, 9, 10) including a frame (42) (Figs. 4, 9, 10) comprising filaments and a coating (43) (Figs. 4, 9, 10) for extraction of thrombus from a blood vessel in the same field of endeavor (P. [0018], [0055]), Diamant further teaching (claim 6) wherein the coating (43) comprises holes (P. [0116] - - cover film 43 can have one or more holes of a predetermined size, e.g. between 5 micron and 200 microns (or even greater) for the passage of blood flow when the device is in a blood vessel).",
"Diamant further discloses that a non-permeable coating and a coating having one or more holes of a predetermined size perform the same function of enhancing the aspiration properties of the thrombus extracting device (Diamant - - Ps. [0116], [0135]). Thus, it would have been obvious to one having ordinary skill in the art before the effective filing date of the claimed invention to substitute one known element (coating comprising holes) for another (non-permeable coating) in order to achieve maintain enhanced aspiration while allowing for the passage of blood as taught by Diamant. Regarding claim 24, Panian in view of Harari discloses the apparatus of claim 4, wherein the coating is disclosed over the complete surface of the expandable tip (503) ([Panian 0093]). The references are not specific to at least a proximal portion of the second subsection as uncoated, however, as discussed above, it would have been obvious to one having ordinary skill in the art before the effective filing date of the claimed invention to substitute one known element (coating comprising holes) for another (non-permeable coating) in order to achieve maintain enhanced aspiration while allowing for the passage of blood as taught by Diamant. As the coating has holes, the portion of the coating with holes would necessarily leave a portion of the element uncoated. Thus, the claimed limitation, wherein at least a proximal portion of the second subsection is uncoated is considered obvious over the teachings of the prior art.",
"It is noted that the claimed limitation is to “a proximal portion” and does not require an entire section or end to be uncoated. Claims 9- 11 is/are rejected under 35 U.S.C. 103 as being unpatentable Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 1 above, and in further view of Yodfat et al. (US Pub. No. 2004/0024416 A1). Yodfat was cited in the Non-Final Office Action, mailed 3/03/22. Regarding claim 9, Panian in view of Harari teach the apparatus of claim 1, Panian disclosing a small braid angle of less than 30 degrees in the collapsed configuration and less than 70 degrees in the expanded configuration (Panian - - P. [0096] and Harari disclosing 6- 24 wires 0.025-0.1 mm in diameter, the helically wound wires counter helically wound at an angle of 70- 120 degrees (Harari - - Ps. [0012], [0091]), but Panian in view of Harari does not expressly disclose wherein: the helicoidal filaments comprise a number ranging between 24 and 48, said filaments having a cross section comprised in a range between 40 and 60 µm; and the braiding angle of the helicoidal filaments with regard to a longitudinal axis of the segment is comprised between 50 and 65 degrees for the first section, and between 15 and 50 for the second sub-section. However, Yodfat teaches a braided tubular body having a variable pitch mesh that directs blood flow containing embolic material by blocking or reducing partially or substantially totally the blood flow in the same field of endeavor, Yodfat teaching (claim 9) the helicoidal filaments comprise a number ranging between 24 and 48 (P. [0026] - - 40 to 160 of filaments falls within the claimed range), said filaments having a cross section comprised in a range between 40 and 60 µm (P. [0027] - - 10-50 µm falls within the claimed range).",
"It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to modify the mesh braid associated with Panian in view of Harari to include helicoidal filaments comprising a number ranging between 24 and 48, said filaments having a cross section comprised in a range between 40 and 60 µm since tubular braid formation is well known in the art, such that the number and size of filaments taught by Yodfat would have yielded predictable results, namely, forming a typical self-expanding braided filaments for use in the vasculature (Yodfat - - Ps. [0026]- [0027]). Yodfat additionally sets forth that the braiding angle is a result effective variable, wherein the larger the value of the braiding angle, the greater the radial force it provides, and hence the greater the strength of the resulting structure (P. [0093]).",
"It would have been obvious to one having ordinary skill in the art at the time the invention was made to modify the braiding angle for the first section to be between 50 and 65 degrees and the braiding angle for the second sub-section to be between 15 and 50 for the purpose of providing for greater or lesser mechanical strength/outward radial force of a specific section of the device, since it has been held that where the general conditions of a claim are disclosed in the prior art, discovering the optimum or workable ranges involves only routine skill in the art. In re Aller, 105 USPQ 233. Regarding claim 10, Panian in view of Harari teach the apparatus of claim 1, Panian disclosing a mall braid angle of less than 30 degrees in the collapsed configuration and less than 70 degrees in the expanded configuration (Panian - - P. [0096] and Harari disclosing 6- 24 wires 0.025-0.1 mm in diameter, the helically wound wires counter helically wound at an angle of 70- 120 degrees and a length of the expandable braid structure being 10- 60 mm or 20- 40 mm (Harari - - Ps.",
"[0012], [0054], [0091]), but Panian in view of Harari does not expressly disclose wherein: the first section comprises a length ranging between 4 and 40 millimeters and the second sub-section comprises a length ranging between 1 and 10 millimeters; and the first section comprises an outer diameter ranging between 3.5 and 6 millimeters and the second sub-section comprises an outer diameter ranging between 1 and 2 millimeters. However, Yodfat teaches a braided tubular body having a variable pitch mesh that directs blood flow containing embolic material by blocking or reducing partially or substantially totally the blood flow in the same field of endeavor, Yodfat teaching The length \"L\" of the device will vary according to the intended location and use, and anatomical position, and is typically between 20 mm and 150 mm (P. [0073]), the diameter \"d\" of the device in the human body is 3-30 mm (P. [0066]), and in the case of the conical shaped device, the different diameters at the two extremities of the device, have a difference can be of the order of 3-5 mm. Yodfat additionally sets forth that the dimensions of the conical shaped device are result effective variables that are a function of the final desired dimensions (P. [0067]). It would have been obvious to one having ordinary skill in the art at the time the invention was made to modify the dimensions of the mesh associated with Panian in view of Harari such that the first section comprises a length ranging between 4 and 40 millimeters and the second sub-section comprises a length ranging between 1 and 10 millimeters; and the first section comprises an outer diameter ranging between 3.5 and 6 millimeters and the second sub-section comprises an outer diameter ranging between 1 and 2 millimeters for the purpose of providing desired dimensions for anchoring the claimed funnel mesh, since it has been held that where the general conditions of a claim are disclosed in the prior art, discovering the optimum or workable ranges involves only routine skill in the art.",
"In re Aller, 105 USPQ 233. Regarding claim 11, Panian in view of Harari teach the apparatus of claim 1, Panian disclosing a small braid angle of less than 30 degrees in the collapsed configuration and less than 70 degrees in the expanded configuration (Panian - - P. [0096] and Harari disclosing 6- 24 wires 0.025-0.1 mm in diameter, the helically wound wires counter helically wound at an angle of 70- 120 degrees (Harari - - Ps. [0012], [0091]), but Panian in view of Harari does not expressly disclose wherein the braiding angle of the first sub- section is comprised between 15 and 45 degrees with regard to a longitudinal axis of the segment.",
"However, Yodfat teaches a braided tubular body having a variable pitch mesh that directs blood flow containing embolic material by blocking or reducing partially or substantially totally the blood flow in the same field of endeavor, Yodfat teaching Yodfat additionally sets forth that the braiding angle is a result effective variable, wherein the larger the value of the braiding angle, the greater the radial force it provides, and hence the greater the strength of the resulting structure (P. [0093]). It would have been obvious to one having ordinary skill in the art at the time the invention was made to modify the braiding angle for the first sub-section of the mesh associated with Panian in view of Harari to be between 15 and 45 degrees for the purpose of providing for greater or lesser mechanical strength of a specific section of the device, since it has been held that where the general conditions of a claim are disclosed in the prior art, discovering the optimum or workable ranges involves only routine skill in the art.",
"In re Aller, 105 USPQ 233. Claim 23 is/are rejected under 35 U.S.C. 103 as being unpatentable over Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 7 above, and further in view of Eckhouse et al. (US Pub. No. 2015/0327866 A1). Regarding claim 23, Panian in view of Harari discloses the apparatus of claim 7, but Panian in view of Harari does not expressly disclose (claim 23) wherein the helicoidal filaments of the mesh are made of a composite comprising Nitinol/Platinum with a percentage of Platinum from 10% to 40% as claimed.",
"However, Eckhouse teaches deploying an expandable device comprised of a mesh made of a controllable fine wire construction (405) into a blood vessel (Ps. [0007], [0044], [0046]) (claim 23) wherein the helicoidal filaments of the mesh are made of a composite comprising Nitinol/Platinum with a percentage of Platinum from 10% to 40% (P. [0075] - - the expandable member can include a plurality of Nitinol wires with a core made of Tantalum or Platinum metals. The radiopaque core can be 20% to 50% by volume (e.g. 30% or 40%; it is noted that 30% or 40% falls within the claimed range). It would have been obvious to one having ordinary skill in the art before the effective filing date of the applicant’s invention to modify the filaments associated with Panian in view of Harari to comprise a composite comprising Nitinol and Platinum with a percentage of Platinum from 20% to 50% as taught by Eckhouse because it would allow a user to visualize the expandable member with angiographic imaging (Eckhouse - - P. [0075]).",
"Thus, the claimed limitations are considered obvious in view of the teachings of the prior art and the 112 rejection above. Claim(s) 25 is/are rejected under 35 U.S.C. 103 as being unpatentable over Panian (US Pub. No. 2017/0333060 A1) in view of Harari et al. (US Pub. No. 2021/0059695 A1) as applied to claim 13 above, and further in view of Ribo Jacobi et al. (US Pub. No. 2017/0303949 A1). Regarding claim 25, Panian in view of Harari disclose the apparatus of claim 13, but Panian in view of Harari does not disclose (claim 25) an automated system as claimed. However, Ribo Jacobi teaches a thrombectomy system in the same field of endeavor (Abstract) including (claim 25) A system configured for automated maneuvering of the thrombectomy apparatus of claim 13 to the blood vessel, the system comprising an automated proximal device configured to provide a guidance system to deploy the thrombectomy apparatus, an imaging device, a communications channel, a control module configured to allow for guidance of the deployment of the thrombectomy apparatus, a data storage device, and a computer assisted controller configured to guide the control module (See Fig.",
"8) (Ps. [0038], [0066], [0070] - - said system can also comprise an imaging device…indicating the location of the distal end of the funnel, and…indicating the location of the vascular thrombus, and a computer assisted controller; FIG. 8 depicts a thrombectomy device of the present invention which allows for the automated maneuvering of the thrombectomy device through a vascular system; since positioning and operation of the device is assisted by fluoroscopy, Ribo Jacobi discloses a guidance system which is interpreted under 35 U.S.C. § 112(f) as a structural equivalent of the guidance system associated with (See applicant’s Specification at p. 18, l. 28- 32 describing advancing applicant’s invention under fluoroscopic guidance). It would have been obvious to one having ordinary skill in the art to automate device for extraction of thrombus associated with Panian in view of Harari with the automated system taught by Ribo Jacobi since providing an automatic or mechanical means to replace a manual activity which accomplished the same result is not sufficient to distinguish over the prior art.",
"In re Venner, 262 F.2d 91, 95, 120 USPQ 193, 194 (CCPA 1958; MPEP 2144.04 (III). Conclusion The prior art made of record and not relied upon is considered pertinent to applicant's disclosure includes: Lowinger et al. (US Pub. No. 2017/0215900 A1). Any inquiry concerning this communication or earlier communications from the examiner should be directed to KANKINDI RWEGO whose telephone number is (303)297-4759. The examiner can normally be reached Monday- Friday: 10:00- 5:00 MT. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice.",
"If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Kelly Bekker can be reached on 571 272-2739. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of published or unpublished applications may be obtained from Patent Center. Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format.",
"For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. /KANKINDI RWEGO/Examiner, Art Unit 3771 /KELLY J BEKKER/Supervisory Patent Examiner, Art Unit 3771"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-07-31.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
966 F.2d 225 59 Fair Empl.Prac.Cas. (BNA) 18, 59 Empl.Prac. Dec. P 41,533,61 USLW 2007 George J. LUDDINGTON, Plaintiff-Appellant,v.INDIANA BELL TELEPHONE COMPANY, Defendant-Appellee. No. 91-2320. United States Court of Appeals,Seventh Circuit. Argued April 6, 1992.Decided June 15, 1992.Rehearing and Rehearing En BancDenied Sept. 4, 1992.
John O. Moss (argued), Moss & Walton, Indianapolis, Ind., for plaintiff-appellant. Gregory J. Utken (argued), Baker & Daniels, Indianapolis, Ind., for defendant-appellee. Robert E. Williams, Douglas S. McDowell, Heidi K. McAuliffe, McGuiness & Williams, Washington, D.C., for amicus curiae Equal Employment Advisory Council. Before POSNER and KANNE, Circuit Judges, and BURNS, Senior District Judge.* POSNER, Circuit Judge.
1 George Luddington has been employed by Indiana Bell since 1966. In 1979 he moved out of the worker ranks and into a bottom-rung management position, where he has been stuck ever since. Between 1982 and 1984 he applied for at least 35 other positions--most higher, some not--with the company. Turned down every time, in 1986 he filed this suit, which charges that every turndown precipitated four distinct statutory violations, for a total of 140, because every one was both an act of racial discrimination and an act of retaliation for complaining about discrimination and each act violated both Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq., which forbids racial discrimination in employment, and 42 U.S.C. § 1981, which entitles every person to the contractual rights of white persons. The district judge granted summary judgment for the company. While the appeal was awaiting argument, Congress enacted the Civil Rights Act of 1991, P.L. 102-166, which amended both statutes; and at our request the parties have briefed the significance of that enactment to the appeal. Some weeks ago another panel of this court, in agreement with the only other courts of appeals to have decided it, Vogel v. City of Cincinnati, 959 F.2d 594, 597-98 (6th Cir.1992); Fray v. Omaha World Herald Co., 960 F.2d 1370 (8th Cir.1992), held that the Act is not to be applied retroactively. Mozee v. American Commercial Marine Service Co., 963 F.2d 929 (7th Cir.1992). In view of the importance of the question, we shall discuss it as if it were an open question in this circuit, rather than, as we would ordinarily do, dispose of it with a citation to our recent decision. But we can be brief.
2 Patterson v. McLean Credit Union, 491 U.S. 164, 109 S.Ct. 2363, 105 L.Ed.2d 132 (1989), had interpreted the then section 1981 to exclude claims based on a refusal to promote or transfer an employee, unless the promotion or transfer could be said to create a new employment relation. The decision, applied as decisions normally (perhaps, after James B. Beam Distilling Co. v. Georgia, --- U.S. ----, 111 S.Ct. 2439, 115 L.Ed.2d 481 (1991), always) are to pending as well as to new cases, wiped out many of Luddington's claims. The new civil rights act makes section 1981 expressly applicable to all racial discrimination in a contractual relation. 42 U.S.C. § 1981(b). If, as Luddington argues, the new act is retroactive, then some of the charges dismissed by the district judge must be reinstated. Of course, there is retroactivity and there is retroactivity. A statute could be applied (1) to cases filed and completed before the effective date of the statute that arise from acts committed before that effective date, (2) to cases filed before the effective date of the statute, but not completed by that date, that arise from acts committed before that date, (3) to cases filed after the effective date that arise from acts committed before that date, (4) to cases in any of these categories but in which the conduct complained of straddles the effective date of the statute, or (5) only to cases filed after the effective date that arise from acts committed entirely after that date. The first four types of application would be retroactive to varying degrees; the fifth wouldn't be retroactive at all. Luddington's case is in cell (2) (Mozee likewise). It was filed, but not completed, before the effective date of the statute and it arises from conduct also committed before that date.
3 The new act provides, so far as bears on this case, that the amendments made by it "shall take effect upon enactment." This could mean no more than that employers were given no grace period in which to bring their practices into compliance with the requirements of the act; they must begin to comply, on pain of sanctions if they fail, on the day the act was passed. So interpreted the statute would be prospective. Or the language that we have quoted could mean that the requirements of the act apply to every undecided case--or perhaps to decided cases as well, which losing litigants could reopen to take advantage of the new act. The floor debates on the 1991 act reveal, as one would expect, divergent views on these questions. It seems futile to search for a legislative intent, bearing in mind that the President is by virtue of the veto power a key participant in the legislative process. President Bush would probably have vetoed a statute that contained an express provision for retroactivity--he had done so the previous session and his veto had not been overridden--but the Democratic majority in both houses would equally have "vetoed" an express provision for prospective application. As so often happens, the contenders could not agree, so they dumped the question into the judiciary's lap without guidance.
4 This politically convenient solution was facilitated by the fact that the courts do not have a consistent rule for deciding whether a statute shall be given retroactive, or merely prospective, effect when the statute does not say. Either of the contending factions in Congress could thus hope that statutory silence would work in its favor. In some cases, notably Bradley v. School Board of City of Richmond, 416 U.S. 696, 94 S.Ct. 2006, 40 L.Ed.2d 476 (1974), the Supreme Court had announced a presumption that statutes are to be applied retroactively, at least in the sense of being applied to cases pending on the statute's effective date. In other cases it had said the opposite. Justice Scalia examined the two lines of cases in Kaiser Aluminum & Chemical Corp. v. Bonjorno, 494 U.S. 827, 841, 110 S.Ct. 1570, 1579, 108 L.Ed.2d 842 (1990) (concurring opinion), and pronounced them "in irreconcilable contradiction." We agree. We too have straddled this divide. Littlefield v. McGuffey, 954 F.2d 1337, 1345 (7th Cir.1992); Orrego v. 833 West Buena Joint Venture, 943 F.2d 730 (7th Cir.1991); FDIC v. Wright, 942 F.2d 1089, 1095 and n. 6 (7th Cir.1991); McKnight v. General Motors Corp., 908 F.2d 104, 110-11 (7th Cir.1990).
5 The idea that the law should confine its prohibitions and regulations to future conduct, so that the persons subject to the law can conform their conduct to it and thus avoid being punished, whether criminally or civilly, for conduct that they had no reason to think unlawful, is a component of the traditional conception of the "rule of law." Except as codified in constitutional provisions (retroactive imposition of criminal penalties, for example, is forbidden by the ex post facto clause of the Constitution), the traditional conception is neither immutable nor absolute. But we think that conformity to it is the right policy for courts to follow in default of other guidance.
6 That brings us part of the way to resolution of the question whether the recent civil rights act should be applied prospectively only, but not all the way, because we are speaking only of a presumption against retroactive application. Procedural innovations not likely to bias decision systematically in favor of one litigant rather than his opponent can, without serious affront to the values crystallized in the phrase "rule of law," be applied to cases pending when the innovations were adopted; and that is the norm even in criminal cases. Dobbert v. Florida, 432 U.S. 282, 97 S.Ct. 2290, 53 L.Ed.2d 344 (1977); Prater v. United States Parole Comm'n, 802 F.2d 948, 953 (7th Cir.1986) (en banc). In civil cases, the presumption against retroactive substantive lawmaking is actually reversed when the newly promulgated "law" is a judicial decision, whether overruling a previous decision or otherwise changing the settled course of the law. Chowaniec v. Arlington Park Race Track, Ltd., 934 F.2d 128, 131-32 (7th Cir.1991); NLRB v. Bufco Corp., 899 F.2d 608, 611-12 (7th Cir.1990); Agfa-Gevaert, A.G. v. A.B. Dick Co., 879 F.2d 1518, 1524 (7th Cir.1989); EEOC v. Vucitech, 842 F.2d 936, 941 (7th Cir.1988); In re Resolution Trust Co., 888 F.2d 57, 58 (8th Cir.1989). In reliance on this presumption--which the Supreme Court's recent decision in Beam may, as we noted, have rendered irrebuttable, although the absence of a majority opinion makes it more than usually difficult to construct the Court's holding--we held in McKnight v. General Motors Corp., supra, 908 F.2d at 107, that Patterson should be applied retroactively. This result rested not on the fiction that judges find rather than make law but on such practical reasons as that otherwise litigants might lack adequate incentives to seek legal change through the courts and courts might feel too free to make such changes, because the costs in disturbance of expectations would be minimized by prospective application. Moreover, the power of a court to redistribute wealth and otherwise disturb settled expectations is held in check by the judicial tradition of incremental change and by the limited control that judges exercise over taxing and spending. A legislature has awesome power uncabined by a professional tradition of modesty and this power is held a little in check by the presumption that its handiwork is to be applied only to future conduct.
7 We might regard this as an exceptional case by pointing out that just as Patterson overruled or at least qualified the decisions that had created the legal regime under which Luddington brought this suit back in 1986, so the 1991 civil rights statute "overruled" Patterson and several other decisions that a majority of the Congress believed had misinterpreted 42 U.S.C. § 1981. And we just said that prospective overruling is the norm. But it would be naive to suppose that Congress sits to review the interpretive soundness of judicial decisions. Congress is not a judicial body, let alone a body of academic commentators on judicial decisions. When it "overrules" a Supreme Court decision it is not registering disagreement with the merits of what the Court did; it is laying down a new rule of conduct--ordinarily for the future. Section 1981 dates back to 1866. It is as unlikely that Congress was attempting to restore section 1981 to the understanding of its framers as that Patterson in cutting back the earlier decisions had restored the statute to its original understanding. The new civil rights act reflects contemporary policy and politics, rather than a dispute between Congress and the Supreme Court over the mechanics of interpretation.
8 If the Civil Rights Act of 1991 made merely technical changes to the statute the presumption of prospective application would be rebutted. It does more. True, it does not prohibit any conduct not already prohibited by Title VII, except the practice of "race norming" (raising mean test scores of minority applicants to the mean of the majority). 42 U.S.C. § 2000e-2(l ). It makes changes in remedies, procedures, and evidence. But such changes can have as profound an impact on behavior outside the courtroom as avowedly substantive changes. Before the Act was passed--which is to say in the short-lived regime of the Patterson decision--a plaintiff in an employment discrimination case based on race could invoke section 1981 and thus obtain common law damages only if the discrimination took the form of refusal to hire in the first place or, if the plaintiff was already an employee, to promote into a new employment relation (such as associate to partner in a law firm). A discharge, or a refusal to make an ordinary promotion or a lateral transfer, was not covered; a victim of discrimination in these forms was remitted to lesser remedies, those of Title VII. The new statute brings these acts under section 1981 and thus subjects employers to greater liabilities.
9 It could be argued that since the underlying norm of nondiscrimination was not new, employers should not be heard to complain that the norm has now been given teeth. But many of us would squawk very loudly indeed if people with unpaid parking tickets were made retroactively liable to life imprisonment; and in fact such a change although purely remedial would violate the ex post facto clause. Miller v. Florida, 482 U.S. 423, 107 S.Ct. 2446, 96 L.Ed.2d 351 (1987); Sequoia Books, Inc. v. Ingemunson, 901 F.2d 630, 639 (7th Cir.1990). The amount of care that individuals and firms take to avoid subjecting themselves to liability whether civil or criminal is a function of the severity of the sanction, and when the severity is increased they are entitled to an opportunity to readjust their level of care in light of the new environment created by the change. That is the philosophy behind the ex post facto clause and also behind the interpretive principle that presumes that a new civil statute applies only to conduct that occurs after its effective date.
10 All this may seem rather hollow in a case such as this, where the change brought about by the new statute is a change back to the legal regime that existed when the defendant committed the acts for which it is being sued. Patterson was decided three years after the last act for which Luddington seeks to hold Indiana Bell liable. Indiana Bell had the same incentive to avoid racial discrimination back then as it does under the Civil Rights Act of 1991. Well, but not quite. The pre-Patterson "legal regime" to which we have referred was merely a set of lower-court decisions, constituting a stab in the dark concerning issues on which the Supreme Court had not yet ruled. It was a tentative regime, which Patterson swept away. And it would be a considerable paradox to hold that the older the conduct complained of, the more securely the conduct is subject to the new statute. The Civil Rights Act of 1991 would be applied to racial discrimination committed before 1989, as well as to that committed since 1991, but racial discrimination committed between 1989 and 1991 would be subject to the more liberal (from a defendant's standpoint) regime of the Patterson decision. A jurisprudence of effective dates for the 1991 statute would be too complex to be worth elaborating and applying, especially when we consider the added costs of litigation that would be imposed. Here for example retroactive application of the 1991 statute would require us to remand a case already in its sixth year that has not been tried. Retroactive application across the board would produce massive dislocations in ongoing litigation and defeat substantial reliance interests of employers. Retroactive application carefully tailored to situations (quite possibly illustrated by this case) in which those reliance interests are minimal would engender enormous satellite litigation and associated uncertainty to fix an indistinct boundary. We hold that the new act is applicable only to conduct engaged in after the effective dates (plural because several sections carry different effective dates) in the act, at least if the suit had been brought before the effective date.
11 That knocks out many of Luddington's section 1981 claims but leaves all his Title VII claims unaffected. Indiana Bell, citing cases which hold that skeletal or perfunctory arguments do not preserve issues for appellate review, asks us not to reach the merits of those claims. It points out, in support of its request, that Luddington's brief does not specify which of the 140 claims presented to the district court he wants us to review, that the questions presented in his brief do not correspond to the questions actually argued in the brief, that the brief quotes a passage about civil rights which does not appear in the toxic-waste case that the brief cites as its source for the passage, and that the statement of facts contains virtually no references to the record.
12 Luddington filed a reply brief, but it contains no reply whatsoever to Indiana Bell's argument that his opening brief failed to preserve his claims for review by this court. Although we could search through the summary judgment record--examine carefully all 140 claims, or 84 claims (4 X (35 - 14)), or some lesser number--and see whether we thought that any of them might have some merit that the district judge had overlooked, if we did this we would be stepping outside the proper judicial role in an adversarial system. This court is not equipped to act as auxiliary lawyer for a party to an appeal. The responsibility for the identification, framing, and argument of the issues on appeal is that of the lawyers, not that of the judges. If we assume the lawyers' responsibilities, we unbalance the market for legal services and take time away from our consideration and decision of other cases. So, if an appellant fails to make a minimally complete and comprehensible argument for each of his claims, he loses regardless of the merits of those claims as they might have appeared on a fuller presentation. In re James Wilson Associates, 965 F.2d 160, 170 (7th Cir.1992); United States v. Harvey, 959 F.2d 1371, 1376 (7th Cir.1992); Petrulis v. Commissioner, 938 F.2d 78, 81 (7th Cir.1991); Hanrahan v. Thieret, 933 F.2d 1328, 1335 n. 13 (7th Cir.1991); United States v. Dunkel, 927 F.2d 955, 956 (7th Cir.1991) (per curiam); United Rope Distributors, Inc. v. Seatriumph Marine Corp., 930 F.2d 532, 536 (7th Cir.1991); United States v. Giovannetti, 919 F.2d 1223, 1230 (7th Cir.1990). At least this is true in civil cases, where there is no constitutional or other legal right to competent representation. We add, should anyone think us too quick to sacrifice substantive justice on the altar of administrative convenience and other bloodless institutional considerations, that a quick perusal of the record has brought to light no indications that the district judge committed any errors.
13 AFFIRMED.
* Hon. James M. Burns of the District of Oregon, sitting by designation | 08-23-2011 | [
"966 F.2d 225 59 Fair Empl.Prac.Cas. (BNA) 18, 59 Empl.Prac. Dec. P 41,533,61 USLW 2007 George J. LUDDINGTON, Plaintiff-Appellant,v.INDIANA BELL TELEPHONE COMPANY, Defendant-Appellee. No. 91-2320. United States Court of Appeals,Seventh Circuit. Argued April 6, 1992.Decided June 15, 1992.Rehearing and Rehearing En BancDenied Sept. 4, 1992. John O. Moss (argued), Moss & Walton, Indianapolis, Ind., for plaintiff-appellant. Gregory J. Utken (argued), Baker & Daniels, Indianapolis, Ind., for defendant-appellee. Robert E. Williams, Douglas S. McDowell, Heidi K. McAuliffe, McGuiness & Williams, Washington, D.C., for amicus curiae Equal Employment Advisory Council. Before POSNER and KANNE, Circuit Judges, and BURNS, Senior District Judge. * POSNER, Circuit Judge. 1 George Luddington has been employed by Indiana Bell since 1966. In 1979 he moved out of the worker ranks and into a bottom-rung management position, where he has been stuck ever since.",
"Between 1982 and 1984 he applied for at least 35 other positions--most higher, some not--with the company. Turned down every time, in 1986 he filed this suit, which charges that every turndown precipitated four distinct statutory violations, for a total of 140, because every one was both an act of racial discrimination and an act of retaliation for complaining about discrimination and each act violated both Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq., which forbids racial discrimination in employment, and 42 U.S.C. § 1981, which entitles every person to the contractual rights of white persons.",
"The district judge granted summary judgment for the company. While the appeal was awaiting argument, Congress enacted the Civil Rights Act of 1991, P.L. 102-166, which amended both statutes; and at our request the parties have briefed the significance of that enactment to the appeal. Some weeks ago another panel of this court, in agreement with the only other courts of appeals to have decided it, Vogel v. City of Cincinnati, 959 F.2d 594, 597-98 (6th Cir.1992); Fray v. Omaha World Herald Co., 960 F.2d 1370 (8th Cir.1992), held that the Act is not to be applied retroactively. Mozee v. American Commercial Marine Service Co., 963 F.2d 929 (7th Cir.1992). In view of the importance of the question, we shall discuss it as if it were an open question in this circuit, rather than, as we would ordinarily do, dispose of it with a citation to our recent decision. But we can be brief. 2 Patterson v. McLean Credit Union, 491 U.S. 164, 109 S.Ct.",
"2363, 105 L.Ed.2d 132 (1989), had interpreted the then section 1981 to exclude claims based on a refusal to promote or transfer an employee, unless the promotion or transfer could be said to create a new employment relation. The decision, applied as decisions normally (perhaps, after James B. Beam Distilling Co. v. Georgia, --- U.S. ----, 111 S.Ct. 2439, 115 L.Ed.2d 481 (1991), always) are to pending as well as to new cases, wiped out many of Luddington's claims. The new civil rights act makes section 1981 expressly applicable to all racial discrimination in a contractual relation. 42 U.S.C. § 1981(b). If, as Luddington argues, the new act is retroactive, then some of the charges dismissed by the district judge must be reinstated. Of course, there is retroactivity and there is retroactivity. A statute could be applied (1) to cases filed and completed before the effective date of the statute that arise from acts committed before that effective date, (2) to cases filed before the effective date of the statute, but not completed by that date, that arise from acts committed before that date, (3) to cases filed after the effective date that arise from acts committed before that date, (4) to cases in any of these categories but in which the conduct complained of straddles the effective date of the statute, or (5) only to cases filed after the effective date that arise from acts committed entirely after that date. The first four types of application would be retroactive to varying degrees; the fifth wouldn't be retroactive at all.",
"Luddington's case is in cell (2) (Mozee likewise). It was filed, but not completed, before the effective date of the statute and it arises from conduct also committed before that date. 3 The new act provides, so far as bears on this case, that the amendments made by it \"shall take effect upon enactment.\" This could mean no more than that employers were given no grace period in which to bring their practices into compliance with the requirements of the act; they must begin to comply, on pain of sanctions if they fail, on the day the act was passed. So interpreted the statute would be prospective. Or the language that we have quoted could mean that the requirements of the act apply to every undecided case--or perhaps to decided cases as well, which losing litigants could reopen to take advantage of the new act. The floor debates on the 1991 act reveal, as one would expect, divergent views on these questions.",
"It seems futile to search for a legislative intent, bearing in mind that the President is by virtue of the veto power a key participant in the legislative process. President Bush would probably have vetoed a statute that contained an express provision for retroactivity--he had done so the previous session and his veto had not been overridden--but the Democratic majority in both houses would equally have \"vetoed\" an express provision for prospective application. As so often happens, the contenders could not agree, so they dumped the question into the judiciary's lap without guidance.",
"4 This politically convenient solution was facilitated by the fact that the courts do not have a consistent rule for deciding whether a statute shall be given retroactive, or merely prospective, effect when the statute does not say. Either of the contending factions in Congress could thus hope that statutory silence would work in its favor. In some cases, notably Bradley v. School Board of City of Richmond, 416 U.S. 696, 94 S.Ct. 2006, 40 L.Ed.2d 476 (1974), the Supreme Court had announced a presumption that statutes are to be applied retroactively, at least in the sense of being applied to cases pending on the statute's effective date. In other cases it had said the opposite. Justice Scalia examined the two lines of cases in Kaiser Aluminum & Chemical Corp. v. Bonjorno, 494 U.S. 827, 841, 110 S.Ct. 1570, 1579, 108 L.Ed.2d 842 (1990) (concurring opinion), and pronounced them \"in irreconcilable contradiction.\"",
"We agree. We too have straddled this divide. Littlefield v. McGuffey, 954 F.2d 1337, 1345 (7th Cir.1992); Orrego v. 833 West Buena Joint Venture, 943 F.2d 730 (7th Cir.1991); FDIC v. Wright, 942 F.2d 1089, 1095 and n. 6 (7th Cir.1991); McKnight v. General Motors Corp., 908 F.2d 104, 110-11 (7th Cir.1990). 5 The idea that the law should confine its prohibitions and regulations to future conduct, so that the persons subject to the law can conform their conduct to it and thus avoid being punished, whether criminally or civilly, for conduct that they had no reason to think unlawful, is a component of the traditional conception of the \"rule of law.\"",
"Except as codified in constitutional provisions (retroactive imposition of criminal penalties, for example, is forbidden by the ex post facto clause of the Constitution), the traditional conception is neither immutable nor absolute. But we think that conformity to it is the right policy for courts to follow in default of other guidance. 6 That brings us part of the way to resolution of the question whether the recent civil rights act should be applied prospectively only, but not all the way, because we are speaking only of a presumption against retroactive application. Procedural innovations not likely to bias decision systematically in favor of one litigant rather than his opponent can, without serious affront to the values crystallized in the phrase \"rule of law,\" be applied to cases pending when the innovations were adopted; and that is the norm even in criminal cases.",
"Dobbert v. Florida, 432 U.S. 282, 97 S.Ct. 2290, 53 L.Ed.2d 344 (1977); Prater v. United States Parole Comm'n, 802 F.2d 948, 953 (7th Cir.1986) (en banc). In civil cases, the presumption against retroactive substantive lawmaking is actually reversed when the newly promulgated \"law\" is a judicial decision, whether overruling a previous decision or otherwise changing the settled course of the law. Chowaniec v. Arlington Park Race Track, Ltd., 934 F.2d 128, 131-32 (7th Cir.1991); NLRB v. Bufco Corp., 899 F.2d 608, 611-12 (7th Cir.1990); Agfa-Gevaert, A.G. v. A.B. Dick Co., 879 F.2d 1518, 1524 (7th Cir.1989); EEOC v. Vucitech, 842 F.2d 936, 941 (7th Cir.1988); In re Resolution Trust Co., 888 F.2d 57, 58 (8th Cir.1989). In reliance on this presumption--which the Supreme Court's recent decision in Beam may, as we noted, have rendered irrebuttable, although the absence of a majority opinion makes it more than usually difficult to construct the Court's holding--we held in McKnight v. General Motors Corp., supra, 908 F.2d at 107, that Patterson should be applied retroactively. This result rested not on the fiction that judges find rather than make law but on such practical reasons as that otherwise litigants might lack adequate incentives to seek legal change through the courts and courts might feel too free to make such changes, because the costs in disturbance of expectations would be minimized by prospective application. Moreover, the power of a court to redistribute wealth and otherwise disturb settled expectations is held in check by the judicial tradition of incremental change and by the limited control that judges exercise over taxing and spending.",
"A legislature has awesome power uncabined by a professional tradition of modesty and this power is held a little in check by the presumption that its handiwork is to be applied only to future conduct. 7 We might regard this as an exceptional case by pointing out that just as Patterson overruled or at least qualified the decisions that had created the legal regime under which Luddington brought this suit back in 1986, so the 1991 civil rights statute \"overruled\" Patterson and several other decisions that a majority of the Congress believed had misinterpreted 42 U.S.C. § 1981. And we just said that prospective overruling is the norm.",
"But it would be naive to suppose that Congress sits to review the interpretive soundness of judicial decisions. Congress is not a judicial body, let alone a body of academic commentators on judicial decisions. When it \"overrules\" a Supreme Court decision it is not registering disagreement with the merits of what the Court did; it is laying down a new rule of conduct--ordinarily for the future. Section 1981 dates back to 1866. It is as unlikely that Congress was attempting to restore section 1981 to the understanding of its framers as that Patterson in cutting back the earlier decisions had restored the statute to its original understanding.",
"The new civil rights act reflects contemporary policy and politics, rather than a dispute between Congress and the Supreme Court over the mechanics of interpretation. 8 If the Civil Rights Act of 1991 made merely technical changes to the statute the presumption of prospective application would be rebutted. It does more. True, it does not prohibit any conduct not already prohibited by Title VII, except the practice of \"race norming\" (raising mean test scores of minority applicants to the mean of the majority). 42 U.S.C. § 2000e-2(l ). It makes changes in remedies, procedures, and evidence.",
"But such changes can have as profound an impact on behavior outside the courtroom as avowedly substantive changes. Before the Act was passed--which is to say in the short-lived regime of the Patterson decision--a plaintiff in an employment discrimination case based on race could invoke section 1981 and thus obtain common law damages only if the discrimination took the form of refusal to hire in the first place or, if the plaintiff was already an employee, to promote into a new employment relation (such as associate to partner in a law firm). A discharge, or a refusal to make an ordinary promotion or a lateral transfer, was not covered; a victim of discrimination in these forms was remitted to lesser remedies, those of Title VII. The new statute brings these acts under section 1981 and thus subjects employers to greater liabilities.",
"9 It could be argued that since the underlying norm of nondiscrimination was not new, employers should not be heard to complain that the norm has now been given teeth. But many of us would squawk very loudly indeed if people with unpaid parking tickets were made retroactively liable to life imprisonment; and in fact such a change although purely remedial would violate the ex post facto clause. Miller v. Florida, 482 U.S. 423, 107 S.Ct. 2446, 96 L.Ed.2d 351 (1987); Sequoia Books, Inc. v. Ingemunson, 901 F.2d 630, 639 (7th Cir.1990).",
"The amount of care that individuals and firms take to avoid subjecting themselves to liability whether civil or criminal is a function of the severity of the sanction, and when the severity is increased they are entitled to an opportunity to readjust their level of care in light of the new environment created by the change. That is the philosophy behind the ex post facto clause and also behind the interpretive principle that presumes that a new civil statute applies only to conduct that occurs after its effective date. 10 All this may seem rather hollow in a case such as this, where the change brought about by the new statute is a change back to the legal regime that existed when the defendant committed the acts for which it is being sued. Patterson was decided three years after the last act for which Luddington seeks to hold Indiana Bell liable. Indiana Bell had the same incentive to avoid racial discrimination back then as it does under the Civil Rights Act of 1991.",
"Well, but not quite. The pre-Patterson \"legal regime\" to which we have referred was merely a set of lower-court decisions, constituting a stab in the dark concerning issues on which the Supreme Court had not yet ruled. It was a tentative regime, which Patterson swept away. And it would be a considerable paradox to hold that the older the conduct complained of, the more securely the conduct is subject to the new statute. The Civil Rights Act of 1991 would be applied to racial discrimination committed before 1989, as well as to that committed since 1991, but racial discrimination committed between 1989 and 1991 would be subject to the more liberal (from a defendant's standpoint) regime of the Patterson decision. A jurisprudence of effective dates for the 1991 statute would be too complex to be worth elaborating and applying, especially when we consider the added costs of litigation that would be imposed.",
"Here for example retroactive application of the 1991 statute would require us to remand a case already in its sixth year that has not been tried. Retroactive application across the board would produce massive dislocations in ongoing litigation and defeat substantial reliance interests of employers. Retroactive application carefully tailored to situations (quite possibly illustrated by this case) in which those reliance interests are minimal would engender enormous satellite litigation and associated uncertainty to fix an indistinct boundary. We hold that the new act is applicable only to conduct engaged in after the effective dates (plural because several sections carry different effective dates) in the act, at least if the suit had been brought before the effective date. 11 That knocks out many of Luddington's section 1981 claims but leaves all his Title VII claims unaffected. Indiana Bell, citing cases which hold that skeletal or perfunctory arguments do not preserve issues for appellate review, asks us not to reach the merits of those claims.",
"It points out, in support of its request, that Luddington's brief does not specify which of the 140 claims presented to the district court he wants us to review, that the questions presented in his brief do not correspond to the questions actually argued in the brief, that the brief quotes a passage about civil rights which does not appear in the toxic-waste case that the brief cites as its source for the passage, and that the statement of facts contains virtually no references to the record. 12 Luddington filed a reply brief, but it contains no reply whatsoever to Indiana Bell's argument that his opening brief failed to preserve his claims for review by this court. Although we could search through the summary judgment record--examine carefully all 140 claims, or 84 claims (4 X (35 - 14)), or some lesser number--and see whether we thought that any of them might have some merit that the district judge had overlooked, if we did this we would be stepping outside the proper judicial role in an adversarial system.",
"This court is not equipped to act as auxiliary lawyer for a party to an appeal. The responsibility for the identification, framing, and argument of the issues on appeal is that of the lawyers, not that of the judges. If we assume the lawyers' responsibilities, we unbalance the market for legal services and take time away from our consideration and decision of other cases. So, if an appellant fails to make a minimally complete and comprehensible argument for each of his claims, he loses regardless of the merits of those claims as they might have appeared on a fuller presentation. In re James Wilson Associates, 965 F.2d 160, 170 (7th Cir.1992); United States v. Harvey, 959 F.2d 1371, 1376 (7th Cir.1992); Petrulis v. Commissioner, 938 F.2d 78, 81 (7th Cir.1991); Hanrahan v. Thieret, 933 F.2d 1328, 1335 n. 13 (7th Cir.1991); United States v. Dunkel, 927 F.2d 955, 956 (7th Cir.1991) (per curiam); United Rope Distributors, Inc. v. Seatriumph Marine Corp., 930 F.2d 532, 536 (7th Cir.1991); United States v. Giovannetti, 919 F.2d 1223, 1230 (7th Cir.1990). At least this is true in civil cases, where there is no constitutional or other legal right to competent representation.",
"We add, should anyone think us too quick to sacrifice substantive justice on the altar of administrative convenience and other bloodless institutional considerations, that a quick perusal of the record has brought to light no indications that the district judge committed any errors. 13 AFFIRMED. * Hon. James M. Burns of the District of Oregon, sitting by designation"
] | https://www.courtlistener.com/api/rest/v3/opinions/584230/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . DETAILED ACTION Claim Rejections - 35 USC § 101 35 U.S.C. 101 reads as follows: Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.
Claims 1-7 are rejected under 35 U.S.C. 101 because the claimed invention is directed to an abstract idea without significantly more. The claim(s) recite(s) a game, comprising: a game substrate for playing a card game, the substrate comprising: one or more player positions, each player position including a bet placement zone indicia layout; and a card indicia layout having a plurality of card frames arranged in a Z-pattern, the Z-pattern represents a pattern and sequential order in which game cards, when dealt, are placed on the substrate, the Z-pattern comprising: a first row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a first row of the dealt cards, a second row of a card frame comprising one single card frame for placement of a second row of the dealt cards, and a third row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a third row of the dealt cards, wherein the last playing card frame of the first row, the one single card frame of the second row and the first playing card frame of the third row designate a middle line of card frames for a respective player to selectively wager a bet on the dealt game cards placed on the middle line of card frames. Such limitations cover certain methods of organizing human activity such as following rules for a wagering game and are directed to a series of steps instructing how to play the wagering game and are thus considered an abstract idea.
eligible.
Double Patenting The nonstatutory double patenting rejection is based on a judicially created doctrine grounded in public policy (a policy reflected in the statute) so as to prevent the unjustified or improper timewise extension of the “right to exclude” granted by a patent and to prevent possible harassment by multiple assignees. A nonstatutory double patenting rejection is appropriate where the conflicting claims are not identical, but at least one examined application claim is not patentably distinct from the reference claim(s) because the examined application claim is either anticipated by, or would have been obvious over, the reference claim(s). See, e.g., In re Berg, 140 F.3d 1428, 46 USPQ2d 1226 (Fed. Cir. 1998); In re Goodman, 11 F.3d 1046, 29 USPQ2d 2010 (Fed. Cir. 1993); In re Longi, 759 F.2d 887, 225 USPQ 645 (Fed. Cir. 1985); In re Van Ornum, 686 F.2d 937, 214 USPQ 761 (CCPA 1982); In re Vogel, 422 F.2d 438, 164 USPQ 619 (CCPA 1970); In re Thorington, 418 F.2d 528, 163 USPQ 644 (CCPA 1969). A timely filed terminal disclaimer in compliance with 37 CFR 1.321(c) or 1.321(d) may be used to overcome an actual or provisional rejection based on nonstatutory double patenting provided the reference application or patent either is shown to be commonly owned with the examined application, or claims an invention made as a result of activities undertaken within the scope of a joint research agreement. See MPEP § 717.02 for applications subject to examination under the first inventor to file provisions of the AIA as explained in MPEP § 2159. See MPEP § 2146 et seq. for applications not subject to examination under the first inventor to file provisions of the AIA . A terminal disclaimer must be signed in compliance with 37 CFR 1.321(b).
Claims 1-20 are rejected on the ground of nonstatutory double patenting as being unpatentable over claims 1-8 of U.S. Patent No. 10,991,210 B1. Although the claims at issue are not identical, they are not patentably distinct from each other because both are claiming similar invention relating to at least a game, comprising: a game substrate for playing a card game, the substrate comprising: one or more player positions, each player position including a bet placement zone indicia layout; and a card indicia layout having a plurality of card frames arranged in a Z-pattern, the Z-pattern represents a pattern and sequential order in which game cards, when dealt, are placed on the substrate, the Z-pattern comprising: a first row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a first row of the dealt cards, a second row of a card frame comprising one single card frame for placement of a second row of the dealt cards, and a third row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a third row of the dealt cards, wherein the last playing card frame of the first row, the one single card frame of the second row and the first playing card frame of the third row designate a middle line of card frames for a respective player to selectively wager a bet on the dealt game cards placed on the middle line of card frames.
Filing of New or Amended Claims The examiner has the initial burden of presenting evidence or reasoning to explain why persons skilled in the art would not recognize in the original disclosure a description of the invention defined by the claims. See Wertheim, 541 F.2d at 263, 191 USPQ at 97 (“[T]he PTO has the initial burden of presenting evidence or reasons why persons skilled in the art would not recognize in the disclosure a description of the invention defined by the claims.”). However, when filing an amendment an applicant should show support in the original disclosure for new or amended claims. See MPEP § 714.02 and § 2163.06 (“Applicant should specifically point out the support for any amendments made to the disclosure.”). Please see MPEP 2163 (II) 3. (b)
Correspondence Any inquiry concerning this communication or earlier communications from the examiner should be directed to SENG H LIM whose telephone number is (571)270-3301. The examiner can normally be reached Monday-Friday (9-5). Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice.
Information regarding the status of published or unpublished applications may be obtained from Patent Center. Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format. For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
/Seng H Lim/Primary Examiner, Art Unit 3715 | 2022-03-06T15:29:42 | [
"Notice of Pre-AIA or AIA Status The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . DETAILED ACTION Claim Rejections - 35 USC § 101 35 U.S.C. 101 reads as follows: Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title. Claims 1-7 are rejected under 35 U.S.C. 101 because the claimed invention is directed to an abstract idea without significantly more. The claim(s) recite(s) a game, comprising: a game substrate for playing a card game, the substrate comprising: one or more player positions, each player position including a bet placement zone indicia layout; and a card indicia layout having a plurality of card frames arranged in a Z-pattern, the Z-pattern represents a pattern and sequential order in which game cards, when dealt, are placed on the substrate, the Z-pattern comprising: a first row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a first row of the dealt cards, a second row of a card frame comprising one single card frame for placement of a second row of the dealt cards, and a third row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a third row of the dealt cards, wherein the last playing card frame of the first row, the one single card frame of the second row and the first playing card frame of the third row designate a middle line of card frames for a respective player to selectively wager a bet on the dealt game cards placed on the middle line of card frames.",
"Such limitations cover certain methods of organizing human activity such as following rules for a wagering game and are directed to a series of steps instructing how to play the wagering game and are thus considered an abstract idea. eligible. Double Patenting The nonstatutory double patenting rejection is based on a judicially created doctrine grounded in public policy (a policy reflected in the statute) so as to prevent the unjustified or improper timewise extension of the “right to exclude” granted by a patent and to prevent possible harassment by multiple assignees. A nonstatutory double patenting rejection is appropriate where the conflicting claims are not identical, but at least one examined application claim is not patentably distinct from the reference claim(s) because the examined application claim is either anticipated by, or would have been obvious over, the reference claim(s). See, e.g., In re Berg, 140 F.3d 1428, 46 USPQ2d 1226 (Fed.",
"Cir. 1998); In re Goodman, 11 F.3d 1046, 29 USPQ2d 2010 (Fed. Cir. 1993); In re Longi, 759 F.2d 887, 225 USPQ 645 (Fed. Cir. 1985); In re Van Ornum, 686 F.2d 937, 214 USPQ 761 (CCPA 1982); In re Vogel, 422 F.2d 438, 164 USPQ 619 (CCPA 1970); In re Thorington, 418 F.2d 528, 163 USPQ 644 (CCPA 1969). A timely filed terminal disclaimer in compliance with 37 CFR 1.321(c) or 1.321(d) may be used to overcome an actual or provisional rejection based on nonstatutory double patenting provided the reference application or patent either is shown to be commonly owned with the examined application, or claims an invention made as a result of activities undertaken within the scope of a joint research agreement. See MPEP § 717.02 for applications subject to examination under the first inventor to file provisions of the AIA as explained in MPEP § 2159. See MPEP § 2146 et seq.",
"for applications not subject to examination under the first inventor to file provisions of the AIA . A terminal disclaimer must be signed in compliance with 37 CFR 1.321(b). Claims 1-20 are rejected on the ground of nonstatutory double patenting as being unpatentable over claims 1-8 of U.S. Patent No. 10,991,210 B1. Although the claims at issue are not identical, they are not patentably distinct from each other because both are claiming similar invention relating to at least a game, comprising: a game substrate for playing a card game, the substrate comprising: one or more player positions, each player position including a bet placement zone indicia layout; and a card indicia layout having a plurality of card frames arranged in a Z-pattern, the Z-pattern represents a pattern and sequential order in which game cards, when dealt, are placed on the substrate, the Z-pattern comprising: a first row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a first row of the dealt cards, a second row of a card frame comprising one single card frame for placement of a second row of the dealt cards, and a third row of card frames comprising at least a first playing card frame and a last playing card frame for placement of a third row of the dealt cards, wherein the last playing card frame of the first row, the one single card frame of the second row and the first playing card frame of the third row designate a middle line of card frames for a respective player to selectively wager a bet on the dealt game cards placed on the middle line of card frames.",
"Filing of New or Amended Claims The examiner has the initial burden of presenting evidence or reasoning to explain why persons skilled in the art would not recognize in the original disclosure a description of the invention defined by the claims. See Wertheim, 541 F.2d at 263, 191 USPQ at 97 (“[T]he PTO has the initial burden of presenting evidence or reasons why persons skilled in the art would not recognize in the disclosure a description of the invention defined by the claims.”). However, when filing an amendment an applicant should show support in the original disclosure for new or amended claims. See MPEP § 714.02 and § 2163.06 (“Applicant should specifically point out the support for any amendments made to the disclosure.”). Please see MPEP 2163 (II) 3.",
"(b) Correspondence Any inquiry concerning this communication or earlier communications from the examiner should be directed to SENG H LIM whose telephone number is (571)270-3301. The examiner can normally be reached Monday-Friday (9-5). Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. Information regarding the status of published or unpublished applications may be obtained from Patent Center. Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format.",
"For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. /Seng H Lim/Primary Examiner, Art Unit 3715"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-03-06.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
EXHIBIT 3.2 NEW JERSEY RESOURCES CORPORATION BY-LAWS Adopted November 20, 1981 Amended November 19, 1982 Amended December 8, 1983 Amended January 29, 1986 Amended and Adopted December 17, 1986 Amended January 27, 1988 Amended November 29, 1995 Amended March 10, 1997 Amended November 17, 1999 Amended July 11, 2007 ARTICLE I BOARD OF DIRECTORS Section 1 - ELECTION.The business and affairs of the Company shall be conducted under the direction of its Board of Directors, which shall have all the powers of the Company except such as are by statute, by the Certificate of Incorporation, or by these By-Laws conferred upon or reserved to the stockholders.The number of directors constituting the entire Board of Directors shall not be less than three, the exact number to be determined from time to time by resolution adopted by the affirmative vote of a majority of the entire Board of Directors, each director to hold office until his successor shall have been elected and qualified.The members of the Board of Directors shall be divided into classes in the manner provided by Paragraph 7 of the Corporation's Certificate of Incorporation and shall be elected and serve for such terms of office as are provided therein. Nominations of persons for election as directors may be made by the Board of Directors or by any stockholder entitled to vote for the election of directors. Any stockholder entitled to vote for the election of directors may nominate a person or persons for election as director only if written notice of such stockholder's intent is delivered to the Secretary of the Company at the principal executive offices of the Company (i) with respect to an election to be held at an annual meeting of stockholders, not later than 75 days prior to the first anniversary of the preceding year's annual meeting, or as set out below, and (ii) with respect to an election to be held at a special meeting of stockholders for the election of directors, not later than 10 days following the date on which public announcement (as defined in Article III, Section 1 of these By-Laws) of the date of such meeting is first made.In the event that the date of the annual meeting is advanced by more than 30 days or delayed by more than 60 days from the anniversary date of the annual meeting, notice by the stockholder must be delivered not later than 75 days prior to such annual meeting, or, if the date of the annual meeting is less than 75 days from the date on which public announcement of the date of such meeting is first made, not later than or the 10th day following the day on which public announcement of the date of such meeting is first made. Notwithstanding anything in the foregoing sentence to the contrary, in the event that the number of directors to be elected to the Board of Directors of the Company is increased and there is no public announcement naming all of the nominees for director or specifying the size of the increased Board of Directors made by the Company at least 85 days prior to the first anniversary of the preceding year's annual meeting, a stockholder's notice required by this Section shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary of the Company not later than the close of business on the 10th day following the day on which such public announcement is first made. Such stockholder's notice shall set forth: (a) the name and address of the stockholder who intends to make the nomination and the name, address, age, and principal occupation or employment of the person or persons to be nominated; (b) a representation that the stockholder is a holder of record of stock of the Company entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice; (c) the number and class of shares of the Company which are owned by such stockholder and the beneficial owner, if any, and the number and class of shares, if any, beneficially owned by the nominee; (d) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder; (e) such other information regarding each nominee that is required to be disclosed in connection with the solicitation of proxies for the election of directors, or as otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the "Exchange Act") (including, without limitation, such person's written consent to being named in a proxy statement as a nominee and to serving as a director if nominated).The Chairman of the Board or other person presiding at a meeting of stockholders, may refuse to acknowledge the nomination of any person not made in accordance with the procedures prescribed by these By-Laws, and in that event the defective nomination shall be disregarded. Subject to limits, if any, contained in the Certificate of Incorporation, the Board of Directors shall be authorized at any time to increase the number of directors and to elect a new director to fill any such newly created directorship, by resolution adopted by the affirmative vote of the majority of the directors then in office.Any such new director shall hold office until the next annual meeting of stockholders and until his successor is elected. If the office of any director becomes vacant for any reason, any such vacancy shall be filled by the Board of Directors, by resolution adopted by the affirmative vote of the majority of the remaining directors then in office.Any such new director shall hold office for the unexpired term and until his successor is elected.The stockholders may fill a directorship resulting from a vacancy or from an increase in the number of directors only if the Board of Directors shall not have done so. The Board of Directors shall be authorized at any time by resolution to increase the number of directors and, by a majority vote, to elect a new director to fill any such newly created directorship.Any such new director shall hold office until the next Annual Stockholders’ Meeting and until his successor is elected. A director, or the entire Board of Directors may be removed only for cause and only by the affirmative vote of the holders of at least 80% of the voting power of the voting stock. Section 2 - BOARD Of DIRECTORS MEETINGS.As soon as practicable, after the Annual Meeting of Stockholders, the Board of Directors shall meet for organization and elect a Chairman, who shall not ex officio be deemed an officer or employee of the Company unless expressly so designated by the Board as the Chief Executive Officer of the Company.The Chairman shall preside at all meetings of the Board of Directors.The Board of Directors may also elect a Vice Chairman, who shall not ex officio be deemed an officer or employee of the Company, but who shall preside at any meeting of the Board of Directors in the absence of the Chairman. Regular meetings of the Board of Directors shall be held in alternate months on the last Wednesday of each month unless otherwise determined by resolution of the Board.The timeand place of each meeting shall be designated by resolution of the Board, Chairman, the President, or the Secretary in the notice of meeting. Special meetings of the Board of Directors may be called at any time by the Chairman or the President.The Secretary shall also call such meeting on the written request of a majority of the directors. 1 No notice shall be required for regular meetings of the Board of Directors, provided the time and place shall have been previously fixed by resolution of the Board.The meeting for organization may be held on the day of and after the annual meeting of stockholders.Two days notice of a special meeting of the Board of Directors shall be given, but this notice may be waived at any time in writing or by telegraph.A meeting may be held at any time without notice when all directors are present and consent thereto.The Board of Directors may also act without a meeting by unanimous written consent which shall be filed with the minutes of the Board. At all meetings of the Board of Directors, the presence in person or by telephonic conference call of a majority of directors shall constitute a quorum for the transaction of business.A lesser number than a quorum, however, may meet and adjourn to any day. Section 3 - REMUNERATION.Directors, other than Company Officers, shall receive remuneration in such amount as shall be fixed by the Board of Directors from time to time. ARTICLE II OFFICERS Section 1 - APPOINTMENT.The Board of Directors shall, as soon as practicable after the Annual Meeting, meet for organization and shall elect or appoint a president; such number of Vice Presidents as the Board may direct; Treasurer; and a Secretary, any of whom may but need not be a director, except that the officer designated as the Chief Executive Officer as provided herein must be one of the directors. The Board of Directors shall further designate either the Chairman of the Board, or the President, as the Chief Executive Officer of the Company.In the event that the Chairman of the Board is designated by the Board of Directors as the Chief Executive Officer, the president shall be the Chief Operating Officer of the Company.In the event that the President is designated as the Chief Executive Officer, the Board may, in its discretion, designate a Vice President as the Chief Operating Officer.The Board of Directors shall further designate an officer as the Chief Financial Officer of the Company. The Board of Directors may also elect or appoint one or more Assistant Vice Presidents, Assistant Treasurers, Assistant Secretaries, and such other officers as the Board shall from time to time deem necessary, who shall have such authority and shall perform such duties as may be prescribed in these By-Laws or by the Board of Directors. Any two or more offices may be held by the same person.All of said officers shall hold their offices at the pleasure of the Board. Section 2 - CHIEF EXECUTIVE OFFICER.The Chief Executive Officer shall preside at all meetings of the stockholders and shall have, under the direction of the Board of Directors, overall executive responsibility for the supervision, management, and control of the business of the Company and of all departments of the Company's operations; he shall sign all certificates of stock and all contracts and other instruments in the name of the Company, unless otherwise ordered by the Board; and shall have the authority and responsibility to do and perform all other duties as provided by law, by these By-Laws, or which are otherwise incidental to his office. Section 3 - CHIEF OPERATING OFFICER.The Chief Operating Officer, if there be any such officer so designated, shall have general responsibility for the operation and administration of the business of the Company subject to the direction and control of the Chief Executive Officer and of the Board of Directors.He shall perform such other duties as may be delegated or assigned to him by the Chief Executive Officer, or by the Board of Directors, and in the absence of the Chief Executive Officer, the Chief Operating Officer shall perform the duties of the Chief Executive Officer, and the performance ofany such duty by the Chief Operating Officer shall be conclusive evidence of his right to act. Section 4 - CHIEF FINANCIAL OFFICER.The Chief Financial Officer shall have overall responsibility for the preparation and maintenance of the Company’s financial books and records, for the accuracy and integrity of all reports of the Company's financial condition which are prepared or issued under his authority, and for the financial affairs; and requirements of the Company.Upon request, he shall make a report of the financial condition of the Company to the Board of Directors or to the Chief Executive Officer, and shall perform such other duties as may be delegated or assigned to him by the Board of Directors or by the Chief Executive Officer. Section 5 - VICE PRESIDENTS.Each Vice President shall have such powers and shall perform such duties as may be delegated or assigned to him by the Board of Directors, by the Chief Executive Officer (if other than the President), by the President, or by the Chief Operating Officer ( if other than the President), and in the absence of the President: the Vice Presidents severally, in the order to be designated by the chief Executive Officer, shall perform the duties of the President, and the performance of any such duty by a Vice President shall be conclusive evidence of his right to act. Section 6 - ASSISTANT VICE PRESIDENT.Each Assistant Vice President shall have such powers and perform such duties as may be assigned to him by the Board of Directors, by the Chief Executive Officer (if other than the President), by the President, or by any Vice President and the performance of any such duty shall be conclusive evidence of his right to act. Section 7 - SECRETARY.The Secretary shall keep minutes of all meetings of the Board of Directors and Committees thereof, and of the stockholders, and shall give all notices of meetings of the stockholders, and of the Board of Directors and Committees thereof.He shall have custody of all deeds, contracts, agreements, and other records, except as otherwise provided in these By-Laws, or by the Board of Directors, and shall attend to such correspondence of the Company as the Board of Directors or the Chief Executive Officer shall direct.He shall be the custodian of the seal of the Company and shall affix it to any instrument requiring the same, except as otherwise provided herein or by the Board of Directors.He shall further perform such other duties as may be delegated or assigned to him by the Board of Directors, or by the Chief Executive Officer, and the performance of any such duty shall be conclusive evidence of his right to act. 2 Section 8 - ASSISTANT SECRETARY.Each Assistant Secretary, if there be any such officer, shall perform such duties as may be assigned to him by the Board of Directors, by the Chief Executive Officer, or by the Secretary and the performance of any such duties shall be conclusive evidence of his right to act. Section 9 - TREASURER.The Treasurer shall have charge of all receipts and disbursements of the Company and shall be the custodian of the Company’s funds.He shall have full authority to receive and give receipts for all monies due and payable to the Company from any source whatever, and to endorse checks, drafts and warrants in its name and on its behalf, and full discharge for the same to give.The Treasurer shall also have full authority to sign all checks, notes, drafts and certificates of stock.A report of the financial condition of the Company shall be made by the Treasurer or to the Chief Executive Officer whenever so requested by either of them.He shall further perform such other duties as may be delegated or assigned to him by the Board of Directors, by the Chief Executive Officer, or by the Chief Financial Officer, and the performance of any such duty shall be conclusive evidence of his right to act. Section 10 - ASSISTANT TREASURER.Each Assistant Treasurer, if there be any such officer, shall have such powers and shall perform such duties as may be assigned to him by the Board of Directors, or by the Chief Executive Officer, by the Chief Financial Officer, or by the Treasurer, and the performance of any such duty shall be conclusive evidence of his right to act. ARTICLE III STOCKHOLDERS' MEETINGS Section 1 – ANNUAL MEETING OF STOCKHOLDERS.The annual meeting of the stockholders shall be held on the last Wednesday in the month of January in each year, at the hour of 10:30 a.m., at the principal office of the Company in New Jersey, or at such other date, time and place as may be fixed from time to time by resolution of the Board of Directors and set forth in the notice of the meeting, for the purpose of electing directors and transacting such other business as may properly come before the meeting. At an annual meeting of the stockholders, only such business shall be conducted as shall have been properly brought before an annual meeting. To be properly brought before an annual meeting, business must be (i) specified in the notice of the meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (ii) otherwise properly brought before the meeting by or at the direction of the Board of Directors or (iii) otherwise properly brought before the meeting by a stockholder of the Company who was a stockholder of record at the time of giving of notice provided for in this Section, who is entitled to vote at the meeting and who complied with the notice procedures set forth in this Section. For business to be properly brought before an annual meeting by a stockholder, the stockholder must have given timely notice thereof in writing to the Secretary of the Company, at the principal executive offices of the Company. To be timely, a stockholder's notice shall be delivered not less than 75 days prior to the first anniversary of the preceding year's meeting; provided however, that in the event that the date of the annual meeting is advanced by more than 30 days or delayed by more than 60 days from such anniversary date, notice by the stockholder, to be timely, must be so delivered not later than the 75th day prior to such annual meeting or the 10th day following the day on which public announcement (as defined herein) of the date of such meeting is first made. Such stockholder's notice shall set forth as to each matter the stockholder proposes to bring before the annual meeting (i) a brief description of the business desired to be brought before the meeting and the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made; and (ii) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the proposal is made (A) the name and address of such stockholder, as they appear on the Company's books, and of such beneficial owner and (B) the class and number of shares of the Company which are owned beneficially and of record by such stockholder and such beneficial owner; and (iii) in the event that such business includes a proposal to amend either the Certificate of Incorporation or the Bylaws of the Company, the language of the proposed amendment. Notwithstanding anything in these By-Laws to the contrary, no business shall be conducted at any annual meeting except in accordance with this paragraph, and the Chairman of the Board or other person presiding at an annual meeting of stockholders, may refuse to permit any business to be brought before an annual meeting without compliance with the foregoing procedures.For the purposes of this paragraph "public announcement" shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Company with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act. In addition to the provisions of this paragraph, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth herein. Nothing in these By-Laws shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Company's proxy statement pursuant to Rule 14a-8 under the Exchange Act. Each share of stock entitled to vote at any meeting shall be entitled to one vote, which vote may be given either in person or by proxy, but no proxy shall be valid for more than eleven months unless a longer time is expressly provided therein, but in no event shall a proxy be valid after three years from the date of execution. Every proxy shall be executed in writing by the shareholder or his agent, except that a proxy may be given by a shareholder or his agent by telegram, cable, telephonic transmission or by any other means of electronic communication so long as that telegram, cable telephonic transmission or other means of electronic communication either sets forth or is submitted with information from which it can be determined that the proxy was authorized by the shareholder or his agent. Section 2 - SPECIAL MEETINGS OF STOCKHOLDERS.Special meetings of the stockholders may be called at any time by the Chief Executive Officer, or upon the order of the Board of Directors, or upon the written request of the holders of a majority of the capital stock outstanding at the time and entitled to vote there at. Section 3 - NOTICE OF MEETINGS OF STOCKHOLDERS; POSTPONEMENT OF MEETINGS; OPENING AND CLOSING OF POLLS.Unless waived, written notice of the time, place, and purpose or purposes of all stockholders’ meetings, either annual or special, shall be given by the Secretary not less than ten nor more than sixty days before the date of the meeting, either personally or by mail, to each stockholder entitled to vote at the meeting at his last post office address as shown on the books of the Company. 3 Any previously scheduled annual or special meeting of the stockholders may be postponed by resolution of the Board of Directors upon public announcement made on or prior to the date previously scheduled for such annual or special meeting. The date and time for the opening and the closing of the polls for each matter to be voted upon at any meeting of stockholders shall be announced at the meeting by or pursuant to the direction of the officer presiding at the meeting. Section 4 - RECORD DATES.The Board of Directors by resolution shall have power to fix in advance a date, not exceeding sixty days or less than ten days preceding the date of any meeting of stockholders, and not exceeding sixty days preceding the date for the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, as a record date for the determination of the stockholders’ vote at any such meeting or entitled to receive payment of any such dividend, or any such allotment of rights or to exercise the rights in respect to any such change, conversion or exchange of capital stock, and in such case stockholders of record on the date so fixed shall be exclusively entitled to such notice of and to vote at such meeting, or to receive payment of such dividend, or allotment of rights, or to exercise such rights, as the case may be, not withstanding any transfer of any stock on the books of the Company after any such record date so fixed as aforesaid. Section 5 - QUORUM OF STOCKHOLDERS.At any meeting of the stockholders, the holders of a majority of all the shares of the capital stock of the Company entitled to vote at such meeting, present in person or represented by proxy, shall constitute a quorum of the stockholders for all purposes, unless the representation of a larger number shall be required by law, and in that case, the representation of the number so required shall constitute a quorum. If the holders of the amount of stock necessary to constitute a quorum shall fail to attend in person or by proxy at the time and place fixed by these By-Laws for an annual meeting or fixed by notice as above provided for a special meeting, a majority in interest of the stockholders present in person or by proxy may adjourn from time to time, without notice other than by announcement at the meeting, until holders of the amount of stock requisite to constitute a quorum shall attend.At any such adjourned meeting at which a quorum shall be present any business may be transacted which might have been transacted at the meeting as originally called. ARTICLE IV COMMITTEES Section 1 - EXECUTIVE COMMITTEE.The Board of Directors may appoint an Executive Committee of not less than three of its members, including ex officio the Chairman of the Board and the Chief Executive Officer (if other than the Chairman).The Chairman shall, ex officio be the Chairman of the Executive Committee and shall preside at its meetings. The Executive Committee shall hold regular meetings at such times and places as shall be designated by resolution of the Board or of the Committee, or in the notice of meeting.Special meetings of the Executive Committee may be called at any time by the Chairman or by the Chief Executive Officer (if other than the Chairman) and shall be called upon the written request of a majority of the members thereof. No notice shall be required for regular meetings of the Executive Committee, provided the time and place thereof shall have been previously fixed by resolution of the Board or the Committee.Two days notice of a special meeting of the Executive Committee shall be given to each member, but this notice may be waived by such member at any time in writing or by telegraph.A meeting of the Executive Committee may be held at any time without notice when all the members are present and consent thereto.The Executive Committee may also act without a meeting, by unanimous written consent of the members thereof which shall be filed with the minutes of the Board.At every meeting of the Executive Committee, the presence in person or by telephonic conference call, of a majority of the members thereof shall constitute a quorum for the transaction of business. During the intervals between the meetings of the Board of Directors, the Executive Committee shall possess and may exercise all the powers of the Board of Directors as may be permitted by law in the management and direction of the business and the conduct of the affairs of the Company, in such manner as the Executive Committee shall deem best for the interests of the Company, in all cases in which specific directions shall not have been given by the Board of Directors. All action taken by the Executive Committee shall be reported to the Board of Directors at its meeting next succeeding such action. Section 2 - AUDIT COMMITTEE. The Board of Directors shall designate an Audit Committee, which shall consist of three or more directors, each of whom shall satisfy the independence requirements of the New York Stock Exchange and the Company’s Corporate Governance Guidelines, each as then in effect. The Audit Committee shall fix its own rules of procedure and a majority of the members serving shall constitute a quorum.The responsibilities of the Audit Committee shall be set forth in the Audit Committee’s charter as approved by the Board of Directors. Section 3 - OTHER COMMITTEES.The Board of Directors may, from time to time, appoint such other committees for any purpose or purposes as the Board may deem appropriate, which shall have such powers as shall be specified in the resolution of appointment. Section 4 - RECORDS AND REPORTS.All committees shall keep full records of their proceedings, and shall report from time to time to the Board, as called upon by the Board, or as provided by these By-Laws. Section 5 - REMUNERATION.Directors, other than Company Officers, shall receive such compensation for their services as a member of any Committee of the Board in such amount as shall be fixed by the Board of Directors from time to time. 4 ARTICLE V COMPANY STOCK Section 1 - TRANSFER OF SHARES.Shares of Company stock shall be transferable only on the books of the Company by the holder or owner in person or by power of attorney, on surrender of the certificate.The canceled certificate shall be permanently attached to its original stub in the book of certificates. Section 2 - STOCKHOLDER LIST.It shall be the duty of the Secretary or Assistant Secretary to prepare, at least ten days before every stockholders’ meeting, a true, full, and complete list of all the stockholders of the Company entitled to vote at the ensuing meeting, with the residence or other address of record of each and with the number of shares held by each, which list shall be made and arranged in alphabetical order, and shall, at all times during the usual hours for business, be open to the examination of any stockholder. Section 3 - LOST CERTIFICATES OF STOCK.Any person or persons applying for a certificate of stock to be issued in lieu of one alleged to be lost or destroyed, shall, pursuant to the laws of the State of New Jersey relating to lost or destroyed certificates of stock, furnish to the Company such information as the Board of Directors may require to ascertain whether a certificate of stock has been lost or destroyed, and shall if required by the Board, furnish a surety bond in form and amount satisfactory to the Board to indemnify the Company and its transfer agent against any claim or loss arising therefrom. ARTICLE VI STOCK OF OTHER CORPORATIONS Section 1 - VOTING 0F STOCK.Unless otherwise ordered by the Board of Directors, the Chief Executive Officer or the President of the Company or, in his or their absence, any Vice President, shall have full power and authority on behalf of the Company to attend and to act and to vote at any meetings of stockholders of any corporation in which the Company may hold stock, and at any such meeting shall possess and may exercise any and all the rights and powers incident to the ownership of such stock, and which as the owner thereof, the Company might have possessed and exercised.The Board of Directors or the Executive Committee, by resolution, from time to time may confer like powers upon any other person or persons. Section 2 - WAIVERS AND CONSENTS.Unless otherwise ordered by the Board of Directors, the Chief Executive Officer or the President of the Company or in his or their absence, any Vice President, shall have full power and authority on behalf of the Company to waive notice of any meeting of stockholders of any corporation in which the Company may hold stock, and to authorize or approve and consent in writing to any action by any such corporation to the same extent and with the same force and effect as an individual stockholder of such corporation. ARTICLE VII FISCAL YEAR Section 1.The fiscal year of the Company shall begin on October first of each year. ARTICLE VIII SEAL Section 1.The seal of the Company shall be similar to the impression contained in the margin opposite hereto. It may at any time be changed by resolution of the Board of Directors. ARTICLE IX INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS Section 1.Each person who is a party or is threatened to be made a party, either as plaintiff, defendant, respondent, or otherwise, to any action, suit, or proceeding, whether civil, criminal, administrative, regulatory or investigative (a "Proceeding"), based upon, arising from, relating to, or by reason of the fact that such person, or a person of whom such person is the legal representative, is or was a director or officer of the Company, or is or was serving at the request of the Company as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation or non-profit corporation, cooperative, partnership, joint venture, trust, or other incorporated or unincorporated enterprise, or any employee benefit plan or trust (each, a "Company Affiliate"), shall be indemnified and held harmless by the Company to the fullest extent authorized by the NJBCA, as the same exists on the date of the adoption of this Bylaw [March 12, 1997] or as may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Company to provide broader indemnification rights than the NJBCA permitted the Company to provide prior to such amendment), against any and all expenses, liability, and loss (including, without limitation, investigation expenses and expert witnesses' and attorneys' retainer, fees and expenses, judgments, penalties, fines, and amounts paid or to be paid in settlement) actually incurred by such person in connection therewith; provided, however, that, except for Proceedings seeking to enforce rights under this Bylaw, the Company shall indemnify any such person seeking to enforce such rights in connection with a Proceeding (or part thereof) initiated by such person only if such Proceeding (or part thereof) was authorized by a majority vote of the Board of Directors.The right to indemnification conferred in this Article IX shall be a contract right and shall include the right to be paid by the Company for expenses to be incurred in defending or prosecuting any such Proceeding in advance of its final disposition. Section 2.The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Article IX shall not be exclusive of any other right which any person may be entitled under any statute, provision of the Restated Certificate of Incorporation, or Bylaw, an agreement, a resolution of shareholders or directors, or otherwise both as to action in such person's official capacity and as to action in another capacity while holding such office. 5 Section 3.The Company may purchase and maintain insurance or furnish similar protection on behalf of any person who is a director, officer, employee, or agent of the Company or who, while a director, officer, employee, or agent of the Company, is serving at the request of the Company as a director, officer, partner, trustee, employee, or agent of a Company Affiliate, against any liability asserted against and incurred by such director, officer, employee, or agent in such capacity or arising out of such director's, officer's, employee's, or agent's status as such, whether or not the Company would have the power to indemnify such director, officer, employee, or agent against such liability under the NJBCA. Section 4.The Board of Directors, or, if so authorized by the Board of Directors and as it relates to the employees or agents of the Company, one or more officers of the Company, may indemnify and advance expenses to directors, officers, employees or agents of the Company on such terms and conditions as the Board of Directors or any such officer or officers, as applicable, deem appropriate under the circumstances. Section 5.Anything in this Article IX to the contrary notwithstanding, no elimination of this Bylaw and no amendment of this Bylaw adversely affecting the right of any person toindemnification or advancement of expenses hereunder shall be effective until the sixtieth day following notice to such indemnified person of such action, and no elimination of or amendment to this Bylaw shall deprive any such person of such person's rights hereunder arising out of alleged or actual occurrences, acts, or failures to act which had their origin prior to such sixtieth day. Section 6.The indemnification and advancement of expenses provided by, or granted pursuant to, this Article IX shall,unless otherwise provided when authorized, continue as to a person who has ceased to be a director, officer, employee, or agent and shall inure to the benefit of the heirs, executors, and administrators of such a person. ARTICLE X AMENDMENTS Section 1.These By-Laws may be amended or repealed (i) by action of a majority of the Board of Directors at any regular or special meeting of the Board of Directors, provided notice of such alteration, amendment, or repeal shall be given in the notice of any such meeting, or (ii) except as otherwise provided in Paragraphs 6, 7, 8, and 9 of the Certificate of Incorporation of the Corporation, by action of the holders of a majority of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, considered for this purpose as one class. 6 | [
"EXHIBIT 3.2 NEW JERSEY RESOURCES CORPORATION BY-LAWS Adopted November 20, 1981 Amended November 19, 1982 Amended December 8, 1983 Amended January 29, 1986 Amended and Adopted December 17, 1986 Amended January 27, 1988 Amended November 29, 1995 Amended March 10, 1997 Amended November 17, 1999 Amended July 11, 2007 ARTICLE I BOARD OF DIRECTORS Section 1 - ELECTION.The business and affairs of the Company shall be conducted under the direction of its Board of Directors, which shall have all the powers of the Company except such as are by statute, by the Certificate of Incorporation, or by these By-Laws conferred upon or reserved to the stockholders.The number of directors constituting the entire Board of Directors shall not be less than three, the exact number to be determined from time to time by resolution adopted by the affirmative vote of a majority of the entire Board of Directors, each director to hold office until his successor shall have been elected and qualified.The members of the Board of Directors shall be divided into classes in the manner provided by Paragraph 7 of the Corporation's Certificate of Incorporation and shall be elected and serve for such terms of office as are provided therein.",
"Nominations of persons for election as directors may be made by the Board of Directors or by any stockholder entitled to vote for the election of directors. Any stockholder entitled to vote for the election of directors may nominate a person or persons for election as director only if written notice of such stockholder's intent is delivered to the Secretary of the Company at the principal executive offices of the Company (i) with respect to an election to be held at an annual meeting of stockholders, not later than 75 days prior to the first anniversary of the preceding year's annual meeting, or as set out below, and (ii) with respect to an election to be held at a special meeting of stockholders for the election of directors, not later than 10 days following the date on which public announcement (as defined in Article III, Section 1 of these By-Laws) of the date of such meeting is first made.In the event that the date of the annual meeting is advanced by more than 30 days or delayed by more than 60 days from the anniversary date of the annual meeting, notice by the stockholder must be delivered not later than 75 days prior to such annual meeting, or, if the date of the annual meeting is less than 75 days from the date on which public announcement of the date of such meeting is first made, not later than or the 10th day following the day on which public announcement of the date of such meeting is first made.",
"Notwithstanding anything in the foregoing sentence to the contrary, in the event that the number of directors to be elected to the Board of Directors of the Company is increased and there is no public announcement naming all of the nominees for director or specifying the size of the increased Board of Directors made by the Company at least 85 days prior to the first anniversary of the preceding year's annual meeting, a stockholder's notice required by this Section shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary of the Company not later than the close of business on the 10th day following the day on which such public announcement is first made.",
"Such stockholder's notice shall set forth: (a) the name and address of the stockholder who intends to make the nomination and the name, address, age, and principal occupation or employment of the person or persons to be nominated; (b) a representation that the stockholder is a holder of record of stock of the Company entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice; (c) the number and class of shares of the Company which are owned by such stockholder and the beneficial owner, if any, and the number and class of shares, if any, beneficially owned by the nominee; (d) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder; (e) such other information regarding each nominee that is required to be disclosed in connection with the solicitation of proxies for the election of directors, or as otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the \"Exchange Act\") (including, without limitation, such person's written consent to being named in a proxy statement as a nominee and to serving as a director if nominated).The Chairman of the Board or other person presiding at a meeting of stockholders, may refuse to acknowledge the nomination of any person not made in accordance with the procedures prescribed by these By-Laws, and in that event the defective nomination shall be disregarded. Subject to limits, if any, contained in the Certificate of Incorporation, the Board of Directors shall be authorized at any time to increase the number of directors and to elect a new director to fill any such newly created directorship, by resolution adopted by the affirmative vote of the majority of the directors then in office.Any such new director shall hold office until the next annual meeting of stockholders and until his successor is elected.",
"If the office of any director becomes vacant for any reason, any such vacancy shall be filled by the Board of Directors, by resolution adopted by the affirmative vote of the majority of the remaining directors then in office.Any such new director shall hold office for the unexpired term and until his successor is elected.The stockholders may fill a directorship resulting from a vacancy or from an increase in the number of directors only if the Board of Directors shall not have done so. The Board of Directors shall be authorized at any time by resolution to increase the number of directors and, by a majority vote, to elect a new director to fill any such newly created directorship.Any such new director shall hold office until the next Annual Stockholders’ Meeting and until his successor is elected. A director, or the entire Board of Directors may be removed only for cause and only by the affirmative vote of the holders of at least 80% of the voting power of the voting stock. Section 2 - BOARD Of DIRECTORS MEETINGS.As soon as practicable, after the Annual Meeting of Stockholders, the Board of Directors shall meet for organization and elect a Chairman, who shall not ex officio be deemed an officer or employee of the Company unless expressly so designated by the Board as the Chief Executive Officer of the Company.The Chairman shall preside at all meetings of the Board of Directors.The Board of Directors may also elect a Vice Chairman, who shall not ex officio be deemed an officer or employee of the Company, but who shall preside at any meeting of the Board of Directors in the absence of the Chairman.",
"Regular meetings of the Board of Directors shall be held in alternate months on the last Wednesday of each month unless otherwise determined by resolution of the Board.The timeand place of each meeting shall be designated by resolution of the Board, Chairman, the President, or the Secretary in the notice of meeting. Special meetings of the Board of Directors may be called at any time by the Chairman or the President.The Secretary shall also call such meeting on the written request of a majority of the directors. 1 No notice shall be required for regular meetings of the Board of Directors, provided the time and place shall have been previously fixed by resolution of the Board.The meeting for organization may be held on the day of and after the annual meeting of stockholders.Two days notice of a special meeting of the Board of Directors shall be given, but this notice may be waived at any time in writing or by telegraph.A meeting may be held at any time without notice when all directors are present and consent thereto.The Board of Directors may also act without a meeting by unanimous written consent which shall be filed with the minutes of the Board. At all meetings of the Board of Directors, the presence in person or by telephonic conference call of a majority of directors shall constitute a quorum for the transaction of business.A lesser number than a quorum, however, may meet and adjourn to any day.",
"Section 3 - REMUNERATION.Directors, other than Company Officers, shall receive remuneration in such amount as shall be fixed by the Board of Directors from time to time. ARTICLE II OFFICERS Section 1 - APPOINTMENT.The Board of Directors shall, as soon as practicable after the Annual Meeting, meet for organization and shall elect or appoint a president; such number of Vice Presidents as the Board may direct; Treasurer; and a Secretary, any of whom may but need not be a director, except that the officer designated as the Chief Executive Officer as provided herein must be one of the directors.",
"The Board of Directors shall further designate either the Chairman of the Board, or the President, as the Chief Executive Officer of the Company.In the event that the Chairman of the Board is designated by the Board of Directors as the Chief Executive Officer, the president shall be the Chief Operating Officer of the Company.In the event that the President is designated as the Chief Executive Officer, the Board may, in its discretion, designate a Vice President as the Chief Operating Officer.The Board of Directors shall further designate an officer as the Chief Financial Officer of the Company. The Board of Directors may also elect or appoint one or more Assistant Vice Presidents, Assistant Treasurers, Assistant Secretaries, and such other officers as the Board shall from time to time deem necessary, who shall have such authority and shall perform such duties as may be prescribed in these By-Laws or by the Board of Directors. Any two or more offices may be held by the same person.All of said officers shall hold their offices at the pleasure of the Board.",
"Section 2 - CHIEF EXECUTIVE OFFICER.The Chief Executive Officer shall preside at all meetings of the stockholders and shall have, under the direction of the Board of Directors, overall executive responsibility for the supervision, management, and control of the business of the Company and of all departments of the Company's operations; he shall sign all certificates of stock and all contracts and other instruments in the name of the Company, unless otherwise ordered by the Board; and shall have the authority and responsibility to do and perform all other duties as provided by law, by these By-Laws, or which are otherwise incidental to his office. Section 3 - CHIEF OPERATING OFFICER.The Chief Operating Officer, if there be any such officer so designated, shall have general responsibility for the operation and administration of the business of the Company subject to the direction and control of the Chief Executive Officer and of the Board of Directors.He shall perform such other duties as may be delegated or assigned to him by the Chief Executive Officer, or by the Board of Directors, and in the absence of the Chief Executive Officer, the Chief Operating Officer shall perform the duties of the Chief Executive Officer, and the performance ofany such duty by the Chief Operating Officer shall be conclusive evidence of his right to act.",
"Section 4 - CHIEF FINANCIAL OFFICER.The Chief Financial Officer shall have overall responsibility for the preparation and maintenance of the Company’s financial books and records, for the accuracy and integrity of all reports of the Company's financial condition which are prepared or issued under his authority, and for the financial affairs; and requirements of the Company.Upon request, he shall make a report of the financial condition of the Company to the Board of Directors or to the Chief Executive Officer, and shall perform such other duties as may be delegated or assigned to him by the Board of Directors or by the Chief Executive Officer. Section 5 - VICE PRESIDENTS.Each Vice President shall have such powers and shall perform such duties as may be delegated or assigned to him by the Board of Directors, by the Chief Executive Officer (if other than the President), by the President, or by the Chief Operating Officer ( if other than the President), and in the absence of the President: the Vice Presidents severally, in the order to be designated by the chief Executive Officer, shall perform the duties of the President, and the performance of any such duty by a Vice President shall be conclusive evidence of his right to act. Section 6 - ASSISTANT VICE PRESIDENT.Each Assistant Vice President shall have such powers and perform such duties as may be assigned to him by the Board of Directors, by the Chief Executive Officer (if other than the President), by the President, or by any Vice President and the performance of any such duty shall be conclusive evidence of his right to act.",
"Section 7 - SECRETARY.The Secretary shall keep minutes of all meetings of the Board of Directors and Committees thereof, and of the stockholders, and shall give all notices of meetings of the stockholders, and of the Board of Directors and Committees thereof.He shall have custody of all deeds, contracts, agreements, and other records, except as otherwise provided in these By-Laws, or by the Board of Directors, and shall attend to such correspondence of the Company as the Board of Directors or the Chief Executive Officer shall direct.He shall be the custodian of the seal of the Company and shall affix it to any instrument requiring the same, except as otherwise provided herein or by the Board of Directors.He shall further perform such other duties as may be delegated or assigned to him by the Board of Directors, or by the Chief Executive Officer, and the performance of any such duty shall be conclusive evidence of his right to act. 2 Section 8 - ASSISTANT SECRETARY.Each Assistant Secretary, if there be any such officer, shall perform such duties as may be assigned to him by the Board of Directors, by the Chief Executive Officer, or by the Secretary and the performance of any such duties shall be conclusive evidence of his right to act.",
"Section 9 - TREASURER.The Treasurer shall have charge of all receipts and disbursements of the Company and shall be the custodian of the Company’s funds.He shall have full authority to receive and give receipts for all monies due and payable to the Company from any source whatever, and to endorse checks, drafts and warrants in its name and on its behalf, and full discharge for the same to give.The Treasurer shall also have full authority to sign all checks, notes, drafts and certificates of stock.A report of the financial condition of the Company shall be made by the Treasurer or to the Chief Executive Officer whenever so requested by either of them.He shall further perform such other duties as may be delegated or assigned to him by the Board of Directors, by the Chief Executive Officer, or by the Chief Financial Officer, and the performance of any such duty shall be conclusive evidence of his right to act. Section 10 - ASSISTANT TREASURER.Each Assistant Treasurer, if there be any such officer, shall have such powers and shall perform such duties as may be assigned to him by the Board of Directors, or by the Chief Executive Officer, by the Chief Financial Officer, or by the Treasurer, and the performance of any such duty shall be conclusive evidence of his right to act. ARTICLE III STOCKHOLDERS' MEETINGS Section 1 – ANNUAL MEETING OF STOCKHOLDERS.The annual meeting of the stockholders shall be held on the last Wednesday in the month of January in each year, at the hour of 10:30 a.m., at the principal office of the Company in New Jersey, or at such other date, time and place as may be fixed from time to time by resolution of the Board of Directors and set forth in the notice of the meeting, for the purpose of electing directors and transacting such other business as may properly come before the meeting.",
"At an annual meeting of the stockholders, only such business shall be conducted as shall have been properly brought before an annual meeting. To be properly brought before an annual meeting, business must be (i) specified in the notice of the meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (ii) otherwise properly brought before the meeting by or at the direction of the Board of Directors or (iii) otherwise properly brought before the meeting by a stockholder of the Company who was a stockholder of record at the time of giving of notice provided for in this Section, who is entitled to vote at the meeting and who complied with the notice procedures set forth in this Section.",
"For business to be properly brought before an annual meeting by a stockholder, the stockholder must have given timely notice thereof in writing to the Secretary of the Company, at the principal executive offices of the Company. To be timely, a stockholder's notice shall be delivered not less than 75 days prior to the first anniversary of the preceding year's meeting; provided however, that in the event that the date of the annual meeting is advanced by more than 30 days or delayed by more than 60 days from such anniversary date, notice by the stockholder, to be timely, must be so delivered not later than the 75th day prior to such annual meeting or the 10th day following the day on which public announcement (as defined herein) of the date of such meeting is first made. Such stockholder's notice shall set forth as to each matter the stockholder proposes to bring before the annual meeting (i) a brief description of the business desired to be brought before the meeting and the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made; and (ii) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the proposal is made (A) the name and address of such stockholder, as they appear on the Company's books, and of such beneficial owner and (B) the class and number of shares of the Company which are owned beneficially and of record by such stockholder and such beneficial owner; and (iii) in the event that such business includes a proposal to amend either the Certificate of Incorporation or the Bylaws of the Company, the language of the proposed amendment.",
"Notwithstanding anything in these By-Laws to the contrary, no business shall be conducted at any annual meeting except in accordance with this paragraph, and the Chairman of the Board or other person presiding at an annual meeting of stockholders, may refuse to permit any business to be brought before an annual meeting without compliance with the foregoing procedures.For the purposes of this paragraph \"public announcement\" shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Company with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act. In addition to the provisions of this paragraph, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth herein. Nothing in these By-Laws shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Company's proxy statement pursuant to Rule 14a-8 under the Exchange Act.",
"Each share of stock entitled to vote at any meeting shall be entitled to one vote, which vote may be given either in person or by proxy, but no proxy shall be valid for more than eleven months unless a longer time is expressly provided therein, but in no event shall a proxy be valid after three years from the date of execution. Every proxy shall be executed in writing by the shareholder or his agent, except that a proxy may be given by a shareholder or his agent by telegram, cable, telephonic transmission or by any other means of electronic communication so long as that telegram, cable telephonic transmission or other means of electronic communication either sets forth or is submitted with information from which it can be determined that the proxy was authorized by the shareholder or his agent. Section 2 - SPECIAL MEETINGS OF STOCKHOLDERS.Special meetings of the stockholders may be called at any time by the Chief Executive Officer, or upon the order of the Board of Directors, or upon the written request of the holders of a majority of the capital stock outstanding at the time and entitled to vote there at.",
"Section 3 - NOTICE OF MEETINGS OF STOCKHOLDERS; POSTPONEMENT OF MEETINGS; OPENING AND CLOSING OF POLLS.Unless waived, written notice of the time, place, and purpose or purposes of all stockholders’ meetings, either annual or special, shall be given by the Secretary not less than ten nor more than sixty days before the date of the meeting, either personally or by mail, to each stockholder entitled to vote at the meeting at his last post office address as shown on the books of the Company. 3 Any previously scheduled annual or special meeting of the stockholders may be postponed by resolution of the Board of Directors upon public announcement made on or prior to the date previously scheduled for such annual or special meeting. The date and time for the opening and the closing of the polls for each matter to be voted upon at any meeting of stockholders shall be announced at the meeting by or pursuant to the direction of the officer presiding at the meeting. Section 4 - RECORD DATES.The Board of Directors by resolution shall have power to fix in advance a date, not exceeding sixty days or less than ten days preceding the date of any meeting of stockholders, and not exceeding sixty days preceding the date for the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, as a record date for the determination of the stockholders’ vote at any such meeting or entitled to receive payment of any such dividend, or any such allotment of rights or to exercise the rights in respect to any such change, conversion or exchange of capital stock, and in such case stockholders of record on the date so fixed shall be exclusively entitled to such notice of and to vote at such meeting, or to receive payment of such dividend, or allotment of rights, or to exercise such rights, as the case may be, not withstanding any transfer of any stock on the books of the Company after any such record date so fixed as aforesaid.",
"Section 5 - QUORUM OF STOCKHOLDERS.At any meeting of the stockholders, the holders of a majority of all the shares of the capital stock of the Company entitled to vote at such meeting, present in person or represented by proxy, shall constitute a quorum of the stockholders for all purposes, unless the representation of a larger number shall be required by law, and in that case, the representation of the number so required shall constitute a quorum. If the holders of the amount of stock necessary to constitute a quorum shall fail to attend in person or by proxy at the time and place fixed by these By-Laws for an annual meeting or fixed by notice as above provided for a special meeting, a majority in interest of the stockholders present in person or by proxy may adjourn from time to time, without notice other than by announcement at the meeting, until holders of the amount of stock requisite to constitute a quorum shall attend.At any such adjourned meeting at which a quorum shall be present any business may be transacted which might have been transacted at the meeting as originally called.",
"ARTICLE IV COMMITTEES Section 1 - EXECUTIVE COMMITTEE.The Board of Directors may appoint an Executive Committee of not less than three of its members, including ex officio the Chairman of the Board and the Chief Executive Officer (if other than the Chairman).The Chairman shall, ex officio be the Chairman of the Executive Committee and shall preside at its meetings. The Executive Committee shall hold regular meetings at such times and places as shall be designated by resolution of the Board or of the Committee, or in the notice of meeting.Special meetings of the Executive Committee may be called at any time by the Chairman or by the Chief Executive Officer (if other than the Chairman) and shall be called upon the written request of a majority of the members thereof. No notice shall be required for regular meetings of the Executive Committee, provided the time and place thereof shall have been previously fixed by resolution of the Board or the Committee.Two days notice of a special meeting of the Executive Committee shall be given to each member, but this notice may be waived by such member at any time in writing or by telegraph.A meeting of the Executive Committee may be held at any time without notice when all the members are present and consent thereto.The Executive Committee may also act without a meeting, by unanimous written consent of the members thereof which shall be filed with the minutes of the Board.At every meeting of the Executive Committee, the presence in person or by telephonic conference call, of a majority of the members thereof shall constitute a quorum for the transaction of business.",
"During the intervals between the meetings of the Board of Directors, the Executive Committee shall possess and may exercise all the powers of the Board of Directors as may be permitted by law in the management and direction of the business and the conduct of the affairs of the Company, in such manner as the Executive Committee shall deem best for the interests of the Company, in all cases in which specific directions shall not have been given by the Board of Directors. All action taken by the Executive Committee shall be reported to the Board of Directors at its meeting next succeeding such action. Section 2 - AUDIT COMMITTEE. The Board of Directors shall designate an Audit Committee, which shall consist of three or more directors, each of whom shall satisfy the independence requirements of the New York Stock Exchange and the Company’s Corporate Governance Guidelines, each as then in effect. The Audit Committee shall fix its own rules of procedure and a majority of the members serving shall constitute a quorum.The responsibilities of the Audit Committee shall be set forth in the Audit Committee’s charter as approved by the Board of Directors. Section 3 - OTHER COMMITTEES.The Board of Directors may, from time to time, appoint such other committees for any purpose or purposes as the Board may deem appropriate, which shall have such powers as shall be specified in the resolution of appointment.",
"Section 4 - RECORDS AND REPORTS.All committees shall keep full records of their proceedings, and shall report from time to time to the Board, as called upon by the Board, or as provided by these By-Laws. Section 5 - REMUNERATION.Directors, other than Company Officers, shall receive such compensation for their services as a member of any Committee of the Board in such amount as shall be fixed by the Board of Directors from time to time. 4 ARTICLE V COMPANY STOCK Section 1 - TRANSFER OF SHARES.Shares of Company stock shall be transferable only on the books of the Company by the holder or owner in person or by power of attorney, on surrender of the certificate.The canceled certificate shall be permanently attached to its original stub in the book of certificates. Section 2 - STOCKHOLDER LIST.It shall be the duty of the Secretary or Assistant Secretary to prepare, at least ten days before every stockholders’ meeting, a true, full, and complete list of all the stockholders of the Company entitled to vote at the ensuing meeting, with the residence or other address of record of each and with the number of shares held by each, which list shall be made and arranged in alphabetical order, and shall, at all times during the usual hours for business, be open to the examination of any stockholder.",
"Section 3 - LOST CERTIFICATES OF STOCK.Any person or persons applying for a certificate of stock to be issued in lieu of one alleged to be lost or destroyed, shall, pursuant to the laws of the State of New Jersey relating to lost or destroyed certificates of stock, furnish to the Company such information as the Board of Directors may require to ascertain whether a certificate of stock has been lost or destroyed, and shall if required by the Board, furnish a surety bond in form and amount satisfactory to the Board to indemnify the Company and its transfer agent against any claim or loss arising therefrom.",
"ARTICLE VI STOCK OF OTHER CORPORATIONS Section 1 - VOTING 0F STOCK.Unless otherwise ordered by the Board of Directors, the Chief Executive Officer or the President of the Company or, in his or their absence, any Vice President, shall have full power and authority on behalf of the Company to attend and to act and to vote at any meetings of stockholders of any corporation in which the Company may hold stock, and at any such meeting shall possess and may exercise any and all the rights and powers incident to the ownership of such stock, and which as the owner thereof, the Company might have possessed and exercised.The Board of Directors or the Executive Committee, by resolution, from time to time may confer like powers upon any other person or persons. Section 2 - WAIVERS AND CONSENTS.Unless otherwise ordered by the Board of Directors, the Chief Executive Officer or the President of the Company or in his or their absence, any Vice President, shall have full power and authority on behalf of the Company to waive notice of any meeting of stockholders of any corporation in which the Company may hold stock, and to authorize or approve and consent in writing to any action by any such corporation to the same extent and with the same force and effect as an individual stockholder of such corporation. ARTICLE VII FISCAL YEAR Section 1.The fiscal year of the Company shall begin on October first of each year.",
"ARTICLE VIII SEAL Section 1.The seal of the Company shall be similar to the impression contained in the margin opposite hereto. It may at any time be changed by resolution of the Board of Directors. ARTICLE IX INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS Section 1.Each person who is a party or is threatened to be made a party, either as plaintiff, defendant, respondent, or otherwise, to any action, suit, or proceeding, whether civil, criminal, administrative, regulatory or investigative (a \"Proceeding\"), based upon, arising from, relating to, or by reason of the fact that such person, or a person of whom such person is the legal representative, is or was a director or officer of the Company, or is or was serving at the request of the Company as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation or non-profit corporation, cooperative, partnership, joint venture, trust, or other incorporated or unincorporated enterprise, or any employee benefit plan or trust (each, a \"Company Affiliate\"), shall be indemnified and held harmless by the Company to the fullest extent authorized by the NJBCA, as the same exists on the date of the adoption of this Bylaw [March 12, 1997] or as may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Company to provide broader indemnification rights than the NJBCA permitted the Company to provide prior to such amendment), against any and all expenses, liability, and loss (including, without limitation, investigation expenses and expert witnesses' and attorneys' retainer, fees and expenses, judgments, penalties, fines, and amounts paid or to be paid in settlement) actually incurred by such person in connection therewith; provided, however, that, except for Proceedings seeking to enforce rights under this Bylaw, the Company shall indemnify any such person seeking to enforce such rights in connection with a Proceeding (or part thereof) initiated by such person only if such Proceeding (or part thereof) was authorized by a majority vote of the Board of Directors.The right to indemnification conferred in this Article IX shall be a contract right and shall include the right to be paid by the Company for expenses to be incurred in defending or prosecuting any such Proceeding in advance of its final disposition.",
"Section 2.The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Article IX shall not be exclusive of any other right which any person may be entitled under any statute, provision of the Restated Certificate of Incorporation, or Bylaw, an agreement, a resolution of shareholders or directors, or otherwise both as to action in such person's official capacity and as to action in another capacity while holding such office. 5 Section 3.The Company may purchase and maintain insurance or furnish similar protection on behalf of any person who is a director, officer, employee, or agent of the Company or who, while a director, officer, employee, or agent of the Company, is serving at the request of the Company as a director, officer, partner, trustee, employee, or agent of a Company Affiliate, against any liability asserted against and incurred by such director, officer, employee, or agent in such capacity or arising out of such director's, officer's, employee's, or agent's status as such, whether or not the Company would have the power to indemnify such director, officer, employee, or agent against such liability under the NJBCA.",
"Section 4.The Board of Directors, or, if so authorized by the Board of Directors and as it relates to the employees or agents of the Company, one or more officers of the Company, may indemnify and advance expenses to directors, officers, employees or agents of the Company on such terms and conditions as the Board of Directors or any such officer or officers, as applicable, deem appropriate under the circumstances. Section 5.Anything in this Article IX to the contrary notwithstanding, no elimination of this Bylaw and no amendment of this Bylaw adversely affecting the right of any person toindemnification or advancement of expenses hereunder shall be effective until the sixtieth day following notice to such indemnified person of such action, and no elimination of or amendment to this Bylaw shall deprive any such person of such person's rights hereunder arising out of alleged or actual occurrences, acts, or failures to act which had their origin prior to such sixtieth day.",
"Section 6.The indemnification and advancement of expenses provided by, or granted pursuant to, this Article IX shall,unless otherwise provided when authorized, continue as to a person who has ceased to be a director, officer, employee, or agent and shall inure to the benefit of the heirs, executors, and administrators of such a person. ARTICLE X AMENDMENTS Section 1.These By-Laws may be amended or repealed (i) by action of a majority of the Board of Directors at any regular or special meeting of the Board of Directors, provided notice of such alteration, amendment, or repeal shall be given in the notice of any such meeting, or (ii) except as otherwise provided in Paragraphs 6, 7, 8, and 9 of the Certificate of Incorporation of the Corporation, by action of the holders of a majority of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, considered for this purpose as one class.",
"6"
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
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OSCN Found Document:OKMULGEE COUNTY FAMILY RESOURCE CENTER, INC. v. MACKEY
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OKMULGEE COUNTY FAMILY RESOURCE CENTER, INC. v. MACKEY2017 OK CIV APP 37Case Number: 114160Decided: 03/09/2017Mandate Issued: 07/26/2017DIVISION IVTHE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION IV
Cite as: 2017 OK CIV APP 37, __ P.3d __
OKMULGEE COUNTY FAMILY RESOURCE CENTER, INC., an Oklahoma non-profit corporation, Plaintiff/Appellee,
v.
DANETTE MACKEY, an individual, Defendant/Appellant.
APPEAL FROM THE DISTRICT COURT OF
OKMULGEE COUNTY, OKLAHOMA HONORABLE KENNETH ADAIR, TRIAL JUDGE
REVERSED AND REMANDED FOR FURTHER PROCEEDINGS
Christopher L. Camp, CAMP LAW FIRM, Tulsa, Oklahoma, for Plaintiff/Appellee
Cynthia Rowe D'Antonio, GREEN JOHNSON MUMINA & D'ANTONIO, Oklahoma City, Oklahoma, for Defendant/Appellant
P. THOMAS THORNBRUGH, VICE-CHIEF JUDGE:
¶1 Defendant, Danette Mackey, appeals the order and judgment of the District Court of Okmulgee County, entered on June 30, 2015, granting Plaintiff, Okmulgee County Family Resources Center, Inc. (OCFRC), default judgment and damages, together with attorney fees and costs, as a discovery sanction. On review,1 we hold that the district court abused its discretion by (1) granting a default judgment of liability as a sanction for the claimed discovery violation in the absence of a viable order compelling Mackey to answer prior to the imposition of sanctions; and (2) awarding actual damages, together with attorney fees and costs, as a sanction without affording Mackey notice and an opportunity to contest OCFRC's claims at hearing. We reverse the lower court's orders and judgments, and remand for further proceedings. BACKGROUND ¶2 This appeal arises from the trial court's "Final Judgment," entered on June 30, 2015, granting OCFRC default judgment and damages, together with attorney fees and costs, as a discovery sanction, because Mackey declined to answer certain questions at a deposition set by OCFRC as part of its malicious prosecution action against Mackey. ¶3 The record reflects that on October 26, 2010, Mackey, through counsel, filed a complaint against OCFRC in the United States District Court for the Northern District of Oklahoma (Case No. 11-CV-662), alleging federal Title VII violations that she claimed had occurred during Mackey's employment with OCFRC. The federal court granted summary judgment in favor of OCFRC, and dismissed Mackey's state law wage claims without prejudice to refiling.2 ¶4 Based on the ruling in the federal case in its favor, OCFRC sued Mackey for malicious prosecution in the District Court of Okmulgee County (Case No. CJ-2014-00081) on April 22, 2014. Mackey, appearing pro se, timely filed her answer on May 12, 2014, claiming as a defense, inter alia, that she had relied upon the advice of counsel.3 ¶5 The court entered a scheduling order4 on July 9, 2014, setting a discovery cut-off date of November 10, 2014. A dispute then developed concerning the efforts of OCFRC's counsel, Christopher Camp, to secure Mackey's deposition. OCFRC claims that Mackey was sent statutory notice of the deposition together with a subpoena to appear for the deposition to be held at the OCFRC offices on November 3, 2014.5 ¶6 On October 31, 2014 (three days before the noticed deposition), Mackey moved to quash the subpoena directing her to appear for the deposition.6 Mackey argued that the parties had not engaged in any written discovery; that OCFRC had withheld information regarding a key witness in the case; that she did not have adequate time to prepare; and that the location of the requested deposition (at OCFRC's offices) imposed an unfair burden due to Mackey's safety concerns. Mackey also filed a motion to amend the scheduling order to extend discovery deadlines to January 30, 2015.7 ¶7 OCFRC opposed Mackey's motions, and filed its own combined motion for relief by responding to Mackey's motion to quash and by seeking an order compelling discovery, citing 12 O.S.2011 § 3237(E).8 On November 19, 2014, the trial court heard and considered Mackey's motion to quash and motion to extend deadlines, along with OCFRC's motion for relief and opposition to motion to quash. The court entered a "Court Minute"9 that, inter alia, directed Mackey to appear on December 12, 2014, for deposition. The minute was on a pre-printed Okmulgee County form, and will be discussed in our analysis below. ¶8 On December 12, 2014, Mackey appeared for deposition as instructed by the court. Mackey was not represented by counsel at the deposition. It is undisputed that she declined to answer questions by asserting by her Fifth Amendment right against self-incrimination. Mackey testified that she was invoking her Fifth Amendment privilege based upon advice, but she declined to disclose the name of the person on whom she had relied. In her appellate brief in chief, Mackey asserts she was advised by counsel that the malicious prosecution action against her had criminal consequences in addition to civil consequences.10 ¶9 OCFRC'S attorney, Camp, ended the deposition but did not apply for an order compelling Mackey to answer the questions she had declined to answer.11 On April 21, 2015 (some four months after the deposition was adjourned), OCFRC filed a "Motion for Default Judgment or other Appropriate Sanctions." This motion cited 12 O.S.2011 § 3237(B), and alleged that Mackey had failed to comply with the court's November 19, 2014 minute order by refusing to answer questions on Fifth Amendment grounds.12 OCFRC also suggested that Mackey hindered the discovery process by bringing an infant to the December 12, 2014 deposition.13 OCFRC's motion was not verified, and according to the record on appeal, was never set or noticed for a hearing.14 ¶10 On June 8, 2015, the trial court entered a journal entry granting OCFRC's motion for default judgment against Mackey as to liability, by way of sanction pursuant to 12 O.S.2011 § 3237(B). The court found that Mackey, "[d]espite this Court's admonition, on December 12, 2014, after being sworn and stating her name for the record . . . . refused to answer all but one (1) of the one hundred sixty-four (164) questions propounded by OCFRC's attorney, purporting to 'assert [her] Fifth Amendment rights under the United States Constitution.'"15 According to the court, no hearing was required prior to entry of its order because Mackey had failed to file a brief in opposition as provided by Rule 4(e), 12 O.S. Supp. 2013, Ch. 2, App., Rules for the District Courts of Oklahoma (District Court Rules). As a consequence, the court stated, it was authorized to treat Mackey's failure as "an implicit concession that [OCFRC's] arguments have merit" so as to work as "a voluntary waiver by Mackey of her opposition to such arguments." Accordingly, the court deemed OCFRC'S motion to have been confessed.16 ¶11 In a separate part of the journal entry, the court noted that, "[b]ecause the amount of damages sought is not readily ascertainable from the face of OCFRC's Petition," OCFRC was directed to submit (within 20 days) an affidavit describing the amount of damages it sought together with its reasonable expenses, including attorney fees, incurred as a result of Mackey's "failure to comply with this Court's discovery order of November 19, 2014" (emphasis added). The journal entry further recited that the court would then "enter final judgment by separate order after submission of that affidavit" (emphasis added).17 ¶12 Thereafter, on June 29, 2015, Attorney Camp submitted, directly to the court, his billing records and an affidavit declaring that OCFRC incurred damages of $141,305.74 in the form of attorney fees expended in defending the federal action, and an additional $9,809.40 in attorney fees and expenses due to Mackey's failure to comply with the Court's minute order of November 19, 2014. 18 The parties dispute whether Mackey received a copy of Camp's affidavit and records.19 ¶13 The day after receiving Camp's affidavit and records, on June 30, 2015, the trial court apparently reviewed the items and entered its "Final Judgment" in favor of OCFRC and against Mackey in the sum of $141,305.74 as damages on OCFRC's claim for malicious prosecution, and the additional sum of $9,225.00 in attorney fees, plus costs of $584.40, as a result of Mackey's failure to comply with the Court's discovery order of November 19, 2014.20 This order was entered without hearing or notice to Mackey. It is from this judgment that Mackey now appeals. STANDARD OF REVIEW ¶14 We review the correctness of the trial court's imposition of sanctions under the abuse of discretion standard. Payne v. Dewitt, 1999 OK 93, ¶ 9, 995 P.2d 1088; State ex rel. Moshe Tal v. City of Okla. City, 2002 OK 97, ¶ 2, 61 P.3d 234; Meadows v. Wal-Mart Stores, Inc., 2001 OK 25, ¶ 5, 21 P.3d 48. To reverse for abuse of discretion, "it must be found that the trial judge made a clearly erroneous conclusion and judgment, against reason and evidence." Abel v. Tisdale, 1980 OK 161, ¶ 20, 619 P.2d 608. To determine whether an abuse of discretion occurred, a review of the facts and the law is essential. Bd. of Regents of Univ. of Okla. v. Nat'l Collegiate Athletic Ass'n, 1977 OK 17, ¶ 3, 561 P.2d 499. ANALYSIS ¶15 The key to analyzing Mackey's claim that the court erred in its sanction judgments is found in the Oklahoma Discovery Code and the clear and unambiguous case law that a motion to compel is a prerequisite to sanctions being imposed for violations of discovery orders. Helton v. Coleman, 1991 OK 43, ¶¶ 10-13, 811 P.2d 100. OCFRC argues that this requirement was met because the court's minute order following hearing on Mackey's motion to quash was an "order compelling discovery" that Mackey subsequently breached during her December 2014 deposition. The prime questions, therefore, are (1) whether the district court's minute order of November 19, 2014,21 was an "order compelling discovery," and (2) whether Mackey violated that order by refusing to answer questions at her deposition on Fifth Amendment grounds. ¶16 In most cases, an analysis of whether the court has entered the requisite order compelling discovery prior to imposing sanctions is a relatively straightforward matter. Such is not the case here. Our analysis is complicated by the fact that there is no transcript of the court proceedings of November 19, 2014, that purportedly formed the basis for the later sanction of default judgment. I. THE PRE-DEPOSITION PROCEEDINGS ¶17 The pre-deposition proceedings began with Mackey's October 31, 2014 motion to quash a subpoena directing her to appear for a November 3, 2014 deposition at the OCFRC offices, and her motion to extend discovery deadlines.22 This was evidently the first discovery request made in this case. The court entered an order on the same date, setting Mackey's motions for hearing on November 19, 2014, a date 16 days after the challenged deposition was scheduled.23 ¶18 OCFRC waited until the day before the hearing to respond, filing a motion that not only responded to Mackey's motions but also raised other claims for relief. OCFRC took the position that, notwithstanding Mackey's motion to quash on October 31, and the order and notice of hearing filed by the court on the same date, Mackey was still obligated by subpoena to attend the November 3, 2014 deposition.24 OCFRC thus additionally asserted that it was entitled to sanctions relief as provided for by 12 O.S.2011 § 3237(E)(1), for fees and costs incurred in preparing for the November 3 deposition, and for an order "compelling discovery."25 OCFRC's new motion was granted the next day. A. The District Court Ruled on OCFRC's § 3237(E) Motion Without Effective
Notice or a Reasonable Opportunity for Mackey to Respond ¶19 The first serious problem with this process is the fact that OCFRC filed its motion seeking discovery sanctions and an order compelling discovery less than 24 hours before the hearing at which the court granted that motion. A motion requesting sanctions is not one that can be decided without briefing pursuant to District Court Rule 4. However, Mackey was given no opportunity whatsoever to brief this matter. The certificate of service on what was essentially both OCFRC's reply and a motion affirmatively seeking both sanctions pursuant to 12 O.S.2011 § 3237(E) and a discovery order indicates that the motion was only mailed to Mackey on November 18. Even assuming arguendo that Mackey received the motion early on the morning of November 19 before departing for her 10 a.m. court appearance, it is clear that she was given no notice that the claims for sanctions and an order to compel would be heard that day, and that she had absolutely no realistic opportunity to prepare a response. Although we do not base our decision on these facts, we note that they raise a serious due process problem. ¶20 The exact legal effect of the resulting, November 19 minute order takes on considerable significance in this case, because that order is the basis for the court's later order of default as a sanction for alleged discovery order violations. OCFRC argued that the November 19 order was "an order compelling discovery" that Mackey subsequently violated during her December 12 deposition. Hence, OCFRC argues, it could move for sanctions against Mackey for refusal to answer questions at deposition without first complying with the rule of Helton that an order to compel is a prerequisite to sanctions being imposed for violations of discovery orders. II. A VALID MOTION TO COMPEL IS A PREREQUISITE TO SANCTIONS
IMPOSED FOR VIOLATIONS OF DISCOVERY ORDERS ¶21 Our first order of business, therefore, is to determine whether the court entered an order compelling discovery that Mackey failed to obey. Failure to obtain such an order would be fatal to OCFRC's quest for sanctions, and would render the trial court's order imposing sanctions, which is the subject of this appeal, void. ¶22 We reiterate that Oklahoma case law is clear that a motion to compel is a prerequisite to sanctions being imposed pursuant to 12 O.S.2011 § 3237. See Helton, 1991 OK 43 at ¶ 11, citing with approval, Hill v. Pierce Mobile Homes, Inc., 1987 OK CIV APP 40, 738 P.2d 1380, and stating the Court was "persuaded that the Court of Appeals correctly concluded" in Hill that an order compelling discovery is a prerequisite to sanctions being imposed by the court. See also Martin v. Johnson, 1998 OK 127, ¶ 37, 975 P.2d 889 ("We conclude that when a party fails to appear at a deposition, and a sanction in the form of a dismissal is sought pursuant to the combined authority of § 3237(B)(2) and (E), the dismissal must be based upon the failure to obey an order compelling the person to attend the deposition.") ¶23 More recently, in Barnett v. Simmons, 2008 OK 100, 197 P.3d 12, our Supreme Court affirmed that the correct procedure for determining whether sanctions should be imposed for a claimed discovery violation under § 3237(B)(2) is to determine first, if the party has, "'failed to obey'" an order of the court instead of focusing on whether the party's conduct was intentional, willful, or in bad faith. See Barnett at ¶ 24. ¶24 To act as the required prerequisite for OCFRC's sanctions request, the November 19 order must, therefore, have two attributes: first, it must be an order compelling discovery; and second, it must have specifically prohibited Mackey from refusing to answer questions on privilege grounds during the December 12 deposition.26 A. Was the November 19 Order An "Order Compelling Discovery?" ¶25 We will assume, for purposes of this opinion only, that the November 19 order was an "order compelling discovery." We include the caveat because the district court's order stated that it was granting relief pursuant to § 3237(E), which deals with sanctions for a failure to attend, not pursuant to a motion to compel.27 We further note that the imposition of any sanction for non-attendance pursuant to § 3237(E) may be excused by the trial court if "the party failing to act has applied for a protective order as provided by subsection C of Section 3226 of this title." ¶26 However, OCFRC chose to omit this line from its citation of § 3237(E) in its response to Mackey's motion to quash, and we have no record that the trial judge considered this applicable principle. We need not consider any use of the district court's discretion in this matter, however, because, even if the order was one compelling discovery, it compelled only Mackey's attendance at a new deposition site. B. Did the Order Compel Mackey Not to Invoke Privilege in the Deposition? ¶27 We have canvassed the entire record on appeal, and find no documented support for OCFRC's position that Mackey's refusal to answer questions at the deposition by invoking her Fifth Amendment rights violated the November 19 order of the court. We find nothing in the "Court Minute" that would or could serve to put Mackey on notice that she was prohibited from such conduct or that she ran the risk of default judgment as a sanction for invoking her Fifth Amendment claims at the December 12 deposition. The principle is very simple: An order made on November 19 could not possibly be read as directing Mackey to answer all questions posed on December 12, because the district court had no idea what those questions were going to be, and therefore had no idea whether a legitimate privilege existed at the time it made the order. ¶28 We find this principle clear. A court cannot "compel" a deponent to answer a question without having some basic knowledge of what the question will be. OCFRC, however, argues that the court's order required Mackey not simply to attend a deposition, but to "submit" to a deposition. OCFRC argues, essentially, that the court, by using the word "submit," entered an order compelling Mackey not to behave as she did in the December 12 deposition, and, hence, OCFRC could move immediately for sanctions for failure to comply with the order. We find no support for this position in Oklahoma law, and reject it.28 C. Additional Oral Orders ¶29 Although we have found the district court's November 19 order could not serve as the required prerequisite for sanctions for Mackey's conduct at the December 12 deposition, OCFRC argues that the district court made a more extensive oral order at the same time, and this oral order could serve as a basis for sanctions. ¶30 According to Attorney Camp's narrative: []. Following arguments, the court denied Mackey's Motion to Quash and ordered Mackey to submit to deposition by oral examination. Specifically, the trial court ordered Mackey to appear at Gaither Law Office in Henryetta, Oklahoma, at 9:00 a.m. on December 12, 2014 to be sworn, and to answer the questions posed. []. In open court, the trial court also expressly admonished Mackey that cavalierly disregarding her obligation to cooperate in discovery would not be tolerated and could warrant severe sanctions.29 OCFRC Answer Brief at pp. 10-11 (emphasis added). ¶31 Eight months passed before the district court belatedly recorded, in its journal entry of June 8, 2015, that it had made any such "oral order." Why such a clearly significant ruling was not recorded in the November 19 minute is unknown to us. Nonetheless, OCFRC argues that this belatedly memorialized statement from the bench constituted a valid "oral order" compelling discovery and giving OCFRC a basis to later seek discovery sanctions without complying with Helton. ¶32 Even assuming, without agreeing, that this confirmation by the judge some eight months later renders his statement to Mackey that "cavalierly disregarding her obligation to cooperate in discovery would not be tolerated and could warrant severe sanctions" an effective "oral order" on November 19, 2014, we agree with Mackey that this "oral order" was in no way specific enough to constitute an order that Mackey could not interpose any privilege objection at deposition. ¶33 We find that Mackey did not violate a prior discovery order of the court during the November 19 deposition. The imposition of a sanction default on that basis, therefore, was an abuse of discretion.30 V. THE COURT'S ENTRY OF DAMAGES POST-DEFAULT WITHOUT
NOTICE OR HEARING VIOLATED MACKEY'S STATUTORY RIGHTS ¶34 The fact that Mackey was never offered an opportunity to contest the quantum of the money damages awarded against her is also troubling. A default admits the right to recovery, but not the amount of damages. State ex. rel. Okla. Bar Ass'n v. Todd. 1992 OK 81, ¶ 15, 833 P.2d 260. In the assessment of damages following entry of a default judgment, the defaulting party has a statutory right to a hearing on the extent of unliquidated damages. Payne, 1999 OK 93 at ¶ 12. Encompassed within this right is the opportunity to a fair post-default inquest at which both the plaintiff and defendant can participate in the proceedings by cross-examining witnesses and introducing evidence on their own behalf. Id., ¶ 13. A default declaration, imposed as a § 3237 (B) (2) sanction, cannot extend beyond saddling the defendant with liability for the harm occasioned . . . . The trial court must leave to a meaningful inquiry the quantum of actual and punitive damages without stripping the party in default of basic forensic devices to test the truth of the plaintiff's evidence. Id., ¶ 12 (emphasis added). ¶35 In Payne, the district court set a hearing on the quantum of damages, but tried the issue "sans jury and without participation by Dewitt's counsel." Id., ¶ 6. The Supreme Court held that this "crippling of Dewitt by stripping him of basic due process truth-testing devices is contrary to the orderly process of assessing damages." Id., ¶ 14. Despite the clear dictate of Payne, that "[i]n the assessment of damages following entry of default judgment, a defaulting party has a statutory right to a hearing on the extent of liquidated damages," id., ¶12 (emphasis in original), OCFRC argues that the defaulting party must demand that "statutory right" before the court is required to respect it. OCFRC argues that Mackey had some form of notice that the court was going to consider damages because she had received the order asking OCFRC to submit a "damages affidavit," and it then became her duty to request a hearing on damages.31 We do not agree that this position complies with Payne. ¶36 Further, even if we were to accept that a court may award unliquidated damages after a default without setting any hearing on the matter and based solely on an affidavit, the record here is clear that Mackey received Camp's affidavit outlining OCFRC's case for damages, at best, less than 24 hours before the court entered its damages award.32 Even if, as proposed by OCFRC, a court is not required to hold a hearing on unliquidated damages after default unless the defendant requests one, it is beyond our ability to comprehend how a defendant might determine he/she wants a hearing without knowing what those requested damages are. ¶37 This crippling of Mackey's basic due process truth-testing devices by depriving her of any opportunity to question or examine Camp's affidavit or other material, finds no support in Oklahoma statutes or case law, and cannot be allowed to stand. VI. THE RECORD IS SILENT ON THE RIGHT TO RECOVER FEES,
INCURRED IN THE DEFENSE OF A FEDERAL TITLE VII ACTION, AS
DAMAGES ¶38 Because the record is silent as to the trial court's rationale for awarding by default OCFRC's attorney fees in Mackey's federal Title VII action as damages in the state malicious prosecution action, we do not know the underlying legal basis for the award. Although there is a specific federal statute allowing a prevailing defendant in a discrimination suit under Title VII of the Civil Rights Act of 1964 to recover attorney fees, it sets, as a matter of federal policy, a high bar, requiring a showing that the plaintiff's case was frivolous, unreasonable , or without foundation. Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 421-22, 98 S. Ct. 694, 700 (1978). An action is frivolous if it is based on an "indisputably meritless legal theory," or if its "factual contentions are clearly baseless." Neitzke v. Williams, 490 U.S. 319, 327, 109 S. Ct. 1827, 1833 (1989). ¶39 In announcing this standard, the United States Supreme Court cautioned district courts to avoid hindsight logic that equates frivolousness with the plaintiff's ultimate failure to prevail. Christiansburg, 134 U.S. at 421-22, 98 S.Ct. at 700-01. Even "[a]llegations that, upon careful examination, prove legally insufficient to require a trial are not, for that reason alone, 'groundless' or 'without foundation' as required by Christiansburg." Hughes v. Rowe, 449 U.S. 5, 15-16, 101 S.Ct. 173, 179 (1980). So long as the plaintiff has "some basis" for the discrimination claim, a prevailing defendant may not recover attorney fees. Obin v. Dist. No. 9 of Internat'l Ass'n of Machinists, 651 F.2d 574, 587 (8th Cir. 1981). We find it clear that summary judgment in the federal case here establishes none of the elements required to recover fees pursuant to these principles.33 A. Seeking Fees for Defending Title VII Cases as Damages in State Courts ¶40 Given the high bar that the U.S. Congress has presented to prevailing defendants attempting to recover fees in a Title VII discrimination suit, Oklahoma courts must exercise careful discretion in awarding such fees as "damages" in a state suit decided by default. If the state provides a procedure by which defendants may avoid the high bar to the recovery of fees purposefully set in federal court, it may obstruct the federal purpose embodied in that standard.34 ¶41 Hence, we find it clear that attorney fees incurred in defending a suit under Title VII can only be awarded as damages in an Oklahoma case if the court conducts the inquiry required by Christiansburg and Hughes. We are doubtful that these elements can be established without record evidence merely by the default "confession" of a motion pursuant to District Court Rule 4(e). ¶42 More fundamentally, a question arises as to whether a party may choose to seek fees as a remedy in a subsequent action when the same fees were available as a statutory entitlement in the original action. Under the American Rule, a party may not recover attorney fees either as costs or as an element of damages unless a contractual, statutory, or equitable exception applies. It is entirely rational that the state should equitably allow prevailing party fees to be recovered as damages for malicious prosecution when no adequate remedy for this damage is available in the underlying action. It is less rational that the law should allow a prevailing party to file a new suit, in a separate court, attempting to recover fees as damages, when the party was entitled to fees in the prior action, and that party waived the right to seek them. If a party already has an entitlement to fees in one court by virtue of being the prevailing party, we see no rational reason why the law should allow that party to refuse that entitlement and instead begin other proceedings where it must prove additional elements in order to recover the same fees. The entire process ignores the potential application of the preclusion doctrine, offends judicial economy, and implicates forum shopping. ¶43 During oral argument, this Court asked OCFRC if it could provide any authority that a party may decline to seek available fees in an underlying case, and then claim the same fees as damages in a subsequent malicious prosecution action. OCFRC cited Kolosky v. Anchor Hocking Corp., No. CA 83-236, 1984 WL 48997 (W.D. Pa. July 11, 1984), as an example of this process. Kolosky held, at *5 (footnotes omitted): [A] cause of action for malicious prosecution and abuse of process does not lie at this point. However, the Court adds that this does not preclude defendant from instituting a separate action for malicious prosecution and abuse of process if it ultimately prevails in this case. In a related footnote, the court added the following statement: Moreover, this holding does not preclude defendant from moving for attorney's fees and costs, under 42 U.S.C. § 2000e-5(k), if it prevails on the Title VII action. Id. at n.6. ¶44 OCFRC argues that the combination of this paragraph and footnote holds that seeking fees as damages in a malicious prosecution action is simply an alternative remedy to seeking them in the prior Title VII case. We interpret the case differently, and think it more likely that the court held that ". . . a cause of action for malicious prosecution and abuse of process does not lie at this point" and this holding does not preclude defendant from moving for attorney fees and costs, under 42 U.S.C. § 2000e-5(k), if it prevails on the Title VII action. We do not find Kolosky persuasive here. B. Preclusion/Limitations Questions ¶45 In federal court, if attorney fees are available after the claims have been resolved, the litigant must claim the fees by filing a motion within 14 days of the entry of judgment. Fed. R. Civ. P. 54(d)(2). Although some federal authority provides for tolling this statutory requirement by post-judgment motion (see, e.g., Weyant v. Okst, 198 F.3d 311, 315 (2d Cir. 1999)), OCFRC did not seek fees in the federal case at all, and intentionally allowed its right to recover these fees in the underlying federal action to expire.35 We note that a substantial undecided question exists whether OCFRC may seek these fees as viable damages when they were available in the underlying case but OCFRC declined to seek them within the required time.36 Accordingly, on remand, if OCFRC's fees incurred in the federal case are again presented as damages in the state malicious prosecution case, we urge the trial court to carefully examine whether such fees may be claimed as viable damages, in the first instance, as a matter of law. CONCLUSION ¶46 We emphasize that this case is an unusual one in many aspects. Its irregularity is doubtless exacerbated by the fact that Defendant Mackey was unrepresented by counsel during the pre-sanction and post-sanction proceedings. Nevertheless, the record shows a process that deprived Mackey of due process involving lack of notice and opportunity to be heard. Key relief was twice granted by the court within 24 hours of OCFRC filing documents requesting that relief, and a written order was supplemented months later by a description of an "oral order" that substantially changed the nature of the original written order. ¶47 The errors we correct here can be avoided if such matters arise on remand by the entry of appropriate orders which specifically delineate the scope of discovery as provided in the Oklahoma Discovery Code, so as to put a recalcitrant party on notice that violations of these orders may result in sanctions to be determined at a future hearing. Hearings should be noticed and set so as to allow an adequate time for response. If such sanctions should issue, the trial court will be mindful that a post-sanction award of damages must afford an opportunity to the offending party to oppose those damages at an appropriate hearing. ¶48 Accordingly, the trial court's sanction order of default judgment entered against Defendant Mackey, and its subsequent damages award upon default together with attorney's fees and costs, are reversed. The matter is remanded for further proceedings consistent with this opinion.
¶49 REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.
WISEMAN, J., and FISCHER, J. (sitting by designation), concur.
FOOTNOTES
1 The parties and counsel appeared and presented oral argument on January 10, 2017, at this Court's request.
2 None of the court filings related to the federal case are included in the record on appeal.
3 Reliance on counsel's advice, after "a full and fair disclosure of known [as distinguished from discoverable] material facts," can be, if true, a complete defense to a malicious prosecution claim. Greenberg v. Wolfberg 1994 OK 147, n.30, 890 P.2d 895.
4 Scheduling Order, Record at 30.
5 While the record shows that the notice and subpoena were unclaimed, it is undisputed that Mackey had actual notice.
6 Motion to Quash Supoena, Record at 32-33.
7 Motion to Extend Deadlines, Record at 34-35.
8 OCFRC's motion and response, Record at 36-61.
9 Record at 62.
10 Appellant's Brief in Chief at page 4. At oral argument, Mackey's counsel admitted that this fact was circumstantially derived, and there is no record evidence as to any advice of counsel.
11 Title 12 O.S.2011 § 3237(A)(2) provides, "When taking a deposition on oral examination, the proponent of the question may complete or adjourn the examination before applying for an order [compelling an answer]."
12 In this motion, OCFRC treats the "Court Minute" of November 19, 2014, as the legal equivalent of an order, and asserts that the court ordered Mackey to answer all questions posed without regard to her right to assert her Fifth Amendment privilege under the U.S. Constitution.
13 This claim was abandoned and is not an issue on appeal.
14 District Court Rule 4(c) provides, "Motions raising fact issues shall be verified by a person having knowledge of the facts, if possible; otherwise, a verified statement by counsel of what the proof will show will suffice until a hearing or stipulation can be provided."
15 Journal Entry of Judgment, filed June 8, 2015, Record at 141-147.
16 Journal Entry, Record at 143, footnote 1. District Court Rule 4(e) provides that under such circumstances "the motion may be deemed confessed" (emphasis added).
17 Journal Entry, Record at 144.
18 Camp's affidavit dated June 26, 2015, and billing records, Record at 150-206.
19 Mackey maintains that whether she received or refused delivery is of little importance since the certified mail receipts show the affidavit and billing records were mailed on the same day the judge entered his decision. See Record at 86-89.
20 Final Judgment dated June 30, 2015, Record at page 208. The sum of the damages appears to be based upon the attorney fees Camp maintained were incurred in the federal action.
21 The term "minute order" has no legal meaning. Minute orders are never a fit substitute for the judge's recordable memorialized entry, and are, by definition, incomplete. Manning v. State ex.rel. Dept. of Pub. Safety, 1994 OK 62, ¶ 6, 876 P.2d 667. The practice of using "court minutes" as the functional equivalent of a recordable entry for the judgment roll, triggering appeal time and memorializing a decision, continues to be problematic and renders the sanction judgment here a nullity. See Mansell v. City of Lawton, 1994 OK 75, 877 P.2d 1120. Justice Winchester, writing for a unanimous Supreme Court in Alexander v. Alexander, 2015 OK 52, ¶ 11, 357 P.3d 481, made clear in language that is impossible not to understand that "documents titled as court minutes . . . . can never constitute a judgment, decree or appealable order." Justice Opala, writing separately in Mansell v. City of Lawton, put it even more succinctly, declaring that, "TRIAL JUDGES SHOULD BE INSTRUCTED TO SIGN ONLY THOSE INSTRUMENTS WHICH THEY INTEND TO BE FILED AND ENTERED ON THE JOURNAL AS JUDGMENTS, DECREES OR ORDERS." 1994 OK 75 at ¶ 22 (Opala, J., concurring in result)(emphasis in original).
22 Record at 32-35.
23 Record at 31.
24 During oral argument before this Court on January 10, 2017, counsel for OCFRC stated that he had had some conversations with Mackey regarding the venue for the depositions, but we have no record whether Mackey told counsel that she would not be attending the November 3 deposition.
25 See OCFRC motion and response filed November 18, 2014, Record at 36-51.
26 We find it clear that when Helton and Barnett hold that an order compelling is a prerequisite to sanctions, the sanctioned party must disobey a specific command of the order to compel to justify sanctions. The bare existence of an order compelling discovery does not justify sanctions unless the order's specific commands are breached.
27 Subsection E, states in relevant part: If a party . . . fails:
1. To appear before the officer who is to take the deposition, after being served with a proper notice; . . . the court in which the action is pending on motion may make such orders in regard to the failure as are just, and among others it may take any action authorized under subparagraphs a, b and c of paragraph 2 of subsection B of this section. In lieu of or in addition to any order, the court shall require the party failing to act or the attorney advising him or her or both to pay the reasonable expenses, including attorney fees, caused by the failure, unless the court finds that the failure was substantially justified or that other circumstances make an award of expenses unjust.
28 At oral argument before this Court, OCFRC cited a federal trial court order indicating the federal judge's opinion that there is a difference between an order "setting a deposition" and one requiring a party to "submit to a deposition." Although federal interpretations of similar federal rules may be persuasive in interpreting the Oklahoma rules (Mehdipour v. State ex rel. Dept. of Corrections, 2004 OK 19, ¶ 18, 90 P.3d 546), we also note that this principle was developed before online reporting of the daily decisions of federal trial judges became common. This new phenomenon has created a situation where the opinions of federal trial judges potentially may be cited as persuasive authority in Oklahoma, while the opinions of Oklahoma's own trial judges may not.
29 We need not address whether such an order would be an abuse of discretion, but note that, at the time these remarks were allegedly made, the only record action by Mackey that may have shown a "refusal to cooperate" was her filing of a motion to quash a deposition and extend discovery. We are doubtful that a court would describe the same behavior by an aggressive attorney as a "cavalier disregard of obligations." A pro se litigant is to be held to the same (not higher) standards than a represented party.
30 Because neither the record nor OCFRC's arguments in this appeal warrant doing so, this opinion does not address the district court's authority to enforce discovery orders through contempt proceedings.
31 The original order filed by the court on June 30, 2015, was amended on April 11, 2016, to reflect that Camp's affidavit, together with the billing records, had been expressly ordered submitted to the court, and provided the basis for the court's award of damages and attorney fees. Record at 232-235.
32 Mackey denies receiving the affidavit at all before the court awarded damages.
33 OCFRC argues that the required elements of malicious prosecution would suffice to show an entitlement to fees under the federal standard, and that Mackey "confessed" malicious prosecution by failing to answer OCFRC's motion seeking default as a sanction. We will not, at this time, enter this thicket and determine if a party who fails to answer a motion confesses not only the factual allegations of the motion, but also the legal conclusions the movant would have the court draw from those facts. Spirgis v. Circle K Stores, Inc., 1987 OK CIV APP 45, 743 P.2d 682 (approved for publication by the Oklahoma Supreme Court), however, indicates that a court has a responsibility to ensure that summary relief is justified pursuant to the facts confessed, even if the opposing party mounts no opposition.
34 "To take the further step of assessing attorney's fees against plaintiffs simply because they do not finally prevail would substantially add to the risks inhering in most litigation and would undercut the efforts of Congress to promote the vigorous enforcement of the provisions of Title VII." Christiansburg, 434 U.S. at 422, 98 S.Ct. at 701.
35 OCFRC's damages affidavit indicates that it did seek costs in the federal case, but no time is attributed to a fee application.
36 This issue would not arise in a case where a defendant is not entitled to fees in the underlying action, again reinforcing the concept that fees as damages for malicious prosecution may be limited to cases where there is no adequate remedy in the original case.
Citationizer© Summary of Documents Citing This Document
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None Found.
Citationizer: Table of Authority
Cite Name Level
Oklahoma Court of Civil Appeals Cases CiteNameLevel 1987 OK CIV APP 40, 738 P.2d 1380, 58 OBJ 1617, Hill v. Pierce Mobile Homes, Inc.Discussed 1987 OK CIV APP 45, 743 P.2d 682, 58 OBJ 1702, Spirgis v. Circle K Stores, Inc.Discussed Oklahoma Supreme Court Cases CiteNameLevel 1991 OK 43, 811 P.2d 100, 62 OBJ 1444, Helton v. ColemanDiscussed at Length 1992 OK 81, 833 P.2d 260, 63 OBJ 1714, State ex rel. Oklahoma Bar Ass'n v. ToddDiscussed 2001 OK 25, 21 P.3d 48, 72 OBJ 827, MEADOWS v. WAL-MART STORES, INC.Discussed 1994 OK 62, 876 P.2d 667, 65 OBJ 1940, Manning v. State ex rel. Dept. of Public SafetyDiscussed 1994 OK 75, 877 P.2d 1120, 65 OBJ 2233, Mansell v. City of LawtonDiscussed at Length 1994 OK 147, 890 P.2d 895, 65 OBJ 4220, Greenberg v. WolfbergDiscussed 2002 OK 97, 61 P.3d 234, STATE ex rel. TAL v. CITY OF OKLAHOMA CITYDiscussed 2004 OK 19, 90 P.3d 546, MEHDIPOUR v. STATE ex rel. DEPT. OF CORRECTIONSDiscussed 2008 OK 100, 197 P.3d 12, BARNETT v. SIMMONSDiscussed 1977 OK 17, 561 P.2d 499, BD. OF REGENTS, ETC. v. NAT. COLLEGIATE ATH. ASS'NDiscussed 2015 OK 52, 357 P.3d 481, ALEXANDER v. ALEXANDERDiscussed 1980 OK 161, 619 P.2d 608, Abel v. TisdaleDiscussed 1999 OK 93, 995 P.2d 1088, 70 OBJ 3452, Payne v. DeWittDiscussed at Length 1998 OK 127, 975 P.2d 889, 70 OBJ 34, Martin v. JohnsonDiscussed Title 12. Civil Procedure CiteNameLevel 12 O.S. 3237, 12 O.S. 3237, Failure to Make or Cooperate in Discovery - SanctionsDiscussed at Length | 09-06-2017 | [
"OSCN Found Document:OKMULGEE COUNTY FAMILY RESOURCE CENTER, INC. v. MACKEY OSCN navigation Home Courts Court Dockets Legal Research Calendar Help Previous Case Top Of Index This Point in Index Citationize Next Case Print Only OKMULGEE COUNTY FAMILY RESOURCE CENTER, INC. v. MACKEY2017 OK CIV APP 37Case Number: 114160Decided: 03/09/2017Mandate Issued: 07/26/2017DIVISION IVTHE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION IV Cite as: 2017 OK CIV APP 37, __ P.3d __ OKMULGEE COUNTY FAMILY RESOURCE CENTER, INC., an Oklahoma non-profit corporation, Plaintiff/Appellee, v. DANETTE MACKEY, an individual, Defendant/Appellant. APPEAL FROM THE DISTRICT COURT OF OKMULGEE COUNTY, OKLAHOMA HONORABLE KENNETH ADAIR, TRIAL JUDGE REVERSED AND REMANDED FOR FURTHER PROCEEDINGS Christopher L. Camp, CAMP LAW FIRM, Tulsa, Oklahoma, for Plaintiff/Appellee Cynthia Rowe D'Antonio, GREEN JOHNSON MUMINA & D'ANTONIO, Oklahoma City, Oklahoma, for Defendant/Appellant P. THOMAS THORNBRUGH, VICE-CHIEF JUDGE: ¶1 Defendant, Danette Mackey, appeals the order and judgment of the District Court of Okmulgee County, entered on June 30, 2015, granting Plaintiff, Okmulgee County Family Resources Center, Inc. (OCFRC), default judgment and damages, together with attorney fees and costs, as a discovery sanction.",
"On review,1 we hold that the district court abused its discretion by (1) granting a default judgment of liability as a sanction for the claimed discovery violation in the absence of a viable order compelling Mackey to answer prior to the imposition of sanctions; and (2) awarding actual damages, together with attorney fees and costs, as a sanction without affording Mackey notice and an opportunity to contest OCFRC's claims at hearing. We reverse the lower court's orders and judgments, and remand for further proceedings. BACKGROUND ¶2 This appeal arises from the trial court's \"Final Judgment,\" entered on June 30, 2015, granting OCFRC default judgment and damages, together with attorney fees and costs, as a discovery sanction, because Mackey declined to answer certain questions at a deposition set by OCFRC as part of its malicious prosecution action against Mackey. ¶3 The record reflects that on October 26, 2010, Mackey, through counsel, filed a complaint against OCFRC in the United States District Court for the Northern District of Oklahoma (Case No.",
"11-CV-662), alleging federal Title VII violations that she claimed had occurred during Mackey's employment with OCFRC. The federal court granted summary judgment in favor of OCFRC, and dismissed Mackey's state law wage claims without prejudice to refiling.2 ¶4 Based on the ruling in the federal case in its favor, OCFRC sued Mackey for malicious prosecution in the District Court of Okmulgee County (Case No. CJ-2014-00081) on April 22, 2014. Mackey, appearing pro se, timely filed her answer on May 12, 2014, claiming as a defense, inter alia, that she had relied upon the advice of counsel.3 ¶5 The court entered a scheduling order4 on July 9, 2014, setting a discovery cut-off date of November 10, 2014. A dispute then developed concerning the efforts of OCFRC's counsel, Christopher Camp, to secure Mackey's deposition.",
"OCFRC claims that Mackey was sent statutory notice of the deposition together with a subpoena to appear for the deposition to be held at the OCFRC offices on November 3, 2014.5 ¶6 On October 31, 2014 (three days before the noticed deposition), Mackey moved to quash the subpoena directing her to appear for the deposition.6 Mackey argued that the parties had not engaged in any written discovery; that OCFRC had withheld information regarding a key witness in the case; that she did not have adequate time to prepare; and that the location of the requested deposition (at OCFRC's offices) imposed an unfair burden due to Mackey's safety concerns.",
"Mackey also filed a motion to amend the scheduling order to extend discovery deadlines to January 30, 2015.7 ¶7 OCFRC opposed Mackey's motions, and filed its own combined motion for relief by responding to Mackey's motion to quash and by seeking an order compelling discovery, citing 12 O.S.2011 § 3237(E).8 On November 19, 2014, the trial court heard and considered Mackey's motion to quash and motion to extend deadlines, along with OCFRC's motion for relief and opposition to motion to quash. The court entered a \"Court Minute\"9 that, inter alia, directed Mackey to appear on December 12, 2014, for deposition. The minute was on a pre-printed Okmulgee County form, and will be discussed in our analysis below. ¶8 On December 12, 2014, Mackey appeared for deposition as instructed by the court. Mackey was not represented by counsel at the deposition. It is undisputed that she declined to answer questions by asserting by her Fifth Amendment right against self-incrimination. Mackey testified that she was invoking her Fifth Amendment privilege based upon advice, but she declined to disclose the name of the person on whom she had relied.",
"In her appellate brief in chief, Mackey asserts she was advised by counsel that the malicious prosecution action against her had criminal consequences in addition to civil consequences.10 ¶9 OCFRC'S attorney, Camp, ended the deposition but did not apply for an order compelling Mackey to answer the questions she had declined to answer.11 On April 21, 2015 (some four months after the deposition was adjourned), OCFRC filed a \"Motion for Default Judgment or other Appropriate Sanctions.\" This motion cited 12 O.S.2011 § 3237(B), and alleged that Mackey had failed to comply with the court's November 19, 2014 minute order by refusing to answer questions on Fifth Amendment grounds.12 OCFRC also suggested that Mackey hindered the discovery process by bringing an infant to the December 12, 2014 deposition.13 OCFRC's motion was not verified, and according to the record on appeal, was never set or noticed for a hearing.14 ¶10 On June 8, 2015, the trial court entered a journal entry granting OCFRC's motion for default judgment against Mackey as to liability, by way of sanction pursuant to 12 O.S.2011 § 3237(B).",
"The court found that Mackey, \"[d]espite this Court's admonition, on December 12, 2014, after being sworn and stating her name for the record . . . . refused to answer all but one (1) of the one hundred sixty-four (164) questions propounded by OCFRC's attorney, purporting to 'assert [her] Fifth Amendment rights under the United States Constitution. '\"15 According to the court, no hearing was required prior to entry of its order because Mackey had failed to file a brief in opposition as provided by Rule 4(e), 12 O.S. Supp. 2013, Ch. 2, App., Rules for the District Courts of Oklahoma (District Court Rules). As a consequence, the court stated, it was authorized to treat Mackey's failure as \"an implicit concession that [OCFRC's] arguments have merit\" so as to work as \"a voluntary waiver by Mackey of her opposition to such arguments.\" Accordingly, the court deemed OCFRC'S motion to have been confessed.16 ¶11 In a separate part of the journal entry, the court noted that, \"[b]ecause the amount of damages sought is not readily ascertainable from the face of OCFRC's Petition,\" OCFRC was directed to submit (within 20 days) an affidavit describing the amount of damages it sought together with its reasonable expenses, including attorney fees, incurred as a result of Mackey's \"failure to comply with this Court's discovery order of November 19, 2014\" (emphasis added).",
"The journal entry further recited that the court would then \"enter final judgment by separate order after submission of that affidavit\" (emphasis added).17 ¶12 Thereafter, on June 29, 2015, Attorney Camp submitted, directly to the court, his billing records and an affidavit declaring that OCFRC incurred damages of $141,305.74 in the form of attorney fees expended in defending the federal action, and an additional $9,809.40 in attorney fees and expenses due to Mackey's failure to comply with the Court's minute order of November 19, 2014. 18 The parties dispute whether Mackey received a copy of Camp's affidavit and records.19 ¶13 The day after receiving Camp's affidavit and records, on June 30, 2015, the trial court apparently reviewed the items and entered its \"Final Judgment\" in favor of OCFRC and against Mackey in the sum of $141,305.74 as damages on OCFRC's claim for malicious prosecution, and the additional sum of $9,225.00 in attorney fees, plus costs of $584.40, as a result of Mackey's failure to comply with the Court's discovery order of November 19, 2014.20 This order was entered without hearing or notice to Mackey. It is from this judgment that Mackey now appeals.",
"STANDARD OF REVIEW ¶14 We review the correctness of the trial court's imposition of sanctions under the abuse of discretion standard. Payne v. Dewitt, 1999 OK 93, ¶ 9, 995 P.2d 1088; State ex rel. Moshe Tal v. City of Okla. City, 2002 OK 97, ¶ 2, 61 P.3d 234; Meadows v. Wal-Mart Stores, Inc., 2001 OK 25, ¶ 5, 21 P.3d 48. To reverse for abuse of discretion, \"it must be found that the trial judge made a clearly erroneous conclusion and judgment, against reason and evidence.\" Abel v. Tisdale, 1980 OK 161, ¶ 20, 619 P.2d 608. To determine whether an abuse of discretion occurred, a review of the facts and the law is essential.",
"Bd. of Regents of Univ. of Okla. v. Nat'l Collegiate Athletic Ass'n, 1977 OK 17, ¶ 3, 561 P.2d 499. ANALYSIS ¶15 The key to analyzing Mackey's claim that the court erred in its sanction judgments is found in the Oklahoma Discovery Code and the clear and unambiguous case law that a motion to compel is a prerequisite to sanctions being imposed for violations of discovery orders. Helton v. Coleman, 1991 OK 43, ¶¶ 10-13, 811 P.2d 100. OCFRC argues that this requirement was met because the court's minute order following hearing on Mackey's motion to quash was an \"order compelling discovery\" that Mackey subsequently breached during her December 2014 deposition. The prime questions, therefore, are (1) whether the district court's minute order of November 19, 2014,21 was an \"order compelling discovery,\" and (2) whether Mackey violated that order by refusing to answer questions at her deposition on Fifth Amendment grounds.",
"¶16 In most cases, an analysis of whether the court has entered the requisite order compelling discovery prior to imposing sanctions is a relatively straightforward matter. Such is not the case here. Our analysis is complicated by the fact that there is no transcript of the court proceedings of November 19, 2014, that purportedly formed the basis for the later sanction of default judgment. I. THE PRE-DEPOSITION PROCEEDINGS ¶17 The pre-deposition proceedings began with Mackey's October 31, 2014 motion to quash a subpoena directing her to appear for a November 3, 2014 deposition at the OCFRC offices, and her motion to extend discovery deadlines.22 This was evidently the first discovery request made in this case. The court entered an order on the same date, setting Mackey's motions for hearing on November 19, 2014, a date 16 days after the challenged deposition was scheduled.23 ¶18 OCFRC waited until the day before the hearing to respond, filing a motion that not only responded to Mackey's motions but also raised other claims for relief. OCFRC took the position that, notwithstanding Mackey's motion to quash on October 31, and the order and notice of hearing filed by the court on the same date, Mackey was still obligated by subpoena to attend the November 3, 2014 deposition.24 OCFRC thus additionally asserted that it was entitled to sanctions relief as provided for by 12 O.S.2011 § 3237(E)(1), for fees and costs incurred in preparing for the November 3 deposition, and for an order \"compelling discovery.",
"\"25 OCFRC's new motion was granted the next day. A. The District Court Ruled on OCFRC's § 3237(E) Motion Without Effective Notice or a Reasonable Opportunity for Mackey to Respond ¶19 The first serious problem with this process is the fact that OCFRC filed its motion seeking discovery sanctions and an order compelling discovery less than 24 hours before the hearing at which the court granted that motion.",
"A motion requesting sanctions is not one that can be decided without briefing pursuant to District Court Rule 4. However, Mackey was given no opportunity whatsoever to brief this matter. The certificate of service on what was essentially both OCFRC's reply and a motion affirmatively seeking both sanctions pursuant to 12 O.S.2011 § 3237(E) and a discovery order indicates that the motion was only mailed to Mackey on November 18. Even assuming arguendo that Mackey received the motion early on the morning of November 19 before departing for her 10 a.m. court appearance, it is clear that she was given no notice that the claims for sanctions and an order to compel would be heard that day, and that she had absolutely no realistic opportunity to prepare a response. Although we do not base our decision on these facts, we note that they raise a serious due process problem.",
"¶20 The exact legal effect of the resulting, November 19 minute order takes on considerable significance in this case, because that order is the basis for the court's later order of default as a sanction for alleged discovery order violations. OCFRC argued that the November 19 order was \"an order compelling discovery\" that Mackey subsequently violated during her December 12 deposition. Hence, OCFRC argues, it could move for sanctions against Mackey for refusal to answer questions at deposition without first complying with the rule of Helton that an order to compel is a prerequisite to sanctions being imposed for violations of discovery orders. II. A VALID MOTION TO COMPEL IS A PREREQUISITE TO SANCTIONS IMPOSED FOR VIOLATIONS OF DISCOVERY ORDERS ¶21 Our first order of business, therefore, is to determine whether the court entered an order compelling discovery that Mackey failed to obey. Failure to obtain such an order would be fatal to OCFRC's quest for sanctions, and would render the trial court's order imposing sanctions, which is the subject of this appeal, void. ¶22 We reiterate that Oklahoma case law is clear that a motion to compel is a prerequisite to sanctions being imposed pursuant to 12 O.S.2011 § 3237.",
"See Helton, 1991 OK 43 at ¶ 11, citing with approval, Hill v. Pierce Mobile Homes, Inc., 1987 OK CIV APP 40, 738 P.2d 1380, and stating the Court was \"persuaded that the Court of Appeals correctly concluded\" in Hill that an order compelling discovery is a prerequisite to sanctions being imposed by the court. See also Martin v. Johnson, 1998 OK 127, ¶ 37, 975 P.2d 889 (\"We conclude that when a party fails to appear at a deposition, and a sanction in the form of a dismissal is sought pursuant to the combined authority of § 3237(B)(2) and (E), the dismissal must be based upon the failure to obey an order compelling the person to attend the deposition.\") ¶23 More recently, in Barnett v. Simmons, 2008 OK 100, 197 P.3d 12, our Supreme Court affirmed that the correct procedure for determining whether sanctions should be imposed for a claimed discovery violation under § 3237(B)(2) is to determine first, if the party has, \"'failed to obey'\" an order of the court instead of focusing on whether the party's conduct was intentional, willful, or in bad faith. See Barnett at ¶ 24. ¶24 To act as the required prerequisite for OCFRC's sanctions request, the November 19 order must, therefore, have two attributes: first, it must be an order compelling discovery; and second, it must have specifically prohibited Mackey from refusing to answer questions on privilege grounds during the December 12 deposition.26 A.",
"Was the November 19 Order An \"Order Compelling Discovery?\" ¶25 We will assume, for purposes of this opinion only, that the November 19 order was an \"order compelling discovery.\" We include the caveat because the district court's order stated that it was granting relief pursuant to § 3237(E), which deals with sanctions for a failure to attend, not pursuant to a motion to compel.27 We further note that the imposition of any sanction for non-attendance pursuant to § 3237(E) may be excused by the trial court if \"the party failing to act has applied for a protective order as provided by subsection C of Section 3226 of this title.\" ¶26 However, OCFRC chose to omit this line from its citation of § 3237(E) in its response to Mackey's motion to quash, and we have no record that the trial judge considered this applicable principle.",
"We need not consider any use of the district court's discretion in this matter, however, because, even if the order was one compelling discovery, it compelled only Mackey's attendance at a new deposition site. B. Did the Order Compel Mackey Not to Invoke Privilege in the Deposition? ¶27 We have canvassed the entire record on appeal, and find no documented support for OCFRC's position that Mackey's refusal to answer questions at the deposition by invoking her Fifth Amendment rights violated the November 19 order of the court. We find nothing in the \"Court Minute\" that would or could serve to put Mackey on notice that she was prohibited from such conduct or that she ran the risk of default judgment as a sanction for invoking her Fifth Amendment claims at the December 12 deposition.",
"The principle is very simple: An order made on November 19 could not possibly be read as directing Mackey to answer all questions posed on December 12, because the district court had no idea what those questions were going to be, and therefore had no idea whether a legitimate privilege existed at the time it made the order. ¶28 We find this principle clear. A court cannot \"compel\" a deponent to answer a question without having some basic knowledge of what the question will be. OCFRC, however, argues that the court's order required Mackey not simply to attend a deposition, but to \"submit\" to a deposition. OCFRC argues, essentially, that the court, by using the word \"submit,\" entered an order compelling Mackey not to behave as she did in the December 12 deposition, and, hence, OCFRC could move immediately for sanctions for failure to comply with the order. We find no support for this position in Oklahoma law, and reject it.28 C. Additional Oral Orders ¶29 Although we have found the district court's November 19 order could not serve as the required prerequisite for sanctions for Mackey's conduct at the December 12 deposition, OCFRC argues that the district court made a more extensive oral order at the same time, and this oral order could serve as a basis for sanctions.",
"¶30 According to Attorney Camp's narrative: []. Following arguments, the court denied Mackey's Motion to Quash and ordered Mackey to submit to deposition by oral examination. Specifically, the trial court ordered Mackey to appear at Gaither Law Office in Henryetta, Oklahoma, at 9:00 a.m. on December 12, 2014 to be sworn, and to answer the questions posed. []. In open court, the trial court also expressly admonished Mackey that cavalierly disregarding her obligation to cooperate in discovery would not be tolerated and could warrant severe sanctions.29 OCFRC Answer Brief at pp. 10-11 (emphasis added). ¶31 Eight months passed before the district court belatedly recorded, in its journal entry of June 8, 2015, that it had made any such \"oral order.\" Why such a clearly significant ruling was not recorded in the November 19 minute is unknown to us. Nonetheless, OCFRC argues that this belatedly memorialized statement from the bench constituted a valid \"oral order\" compelling discovery and giving OCFRC a basis to later seek discovery sanctions without complying with Helton.",
"¶32 Even assuming, without agreeing, that this confirmation by the judge some eight months later renders his statement to Mackey that \"cavalierly disregarding her obligation to cooperate in discovery would not be tolerated and could warrant severe sanctions\" an effective \"oral order\" on November 19, 2014, we agree with Mackey that this \"oral order\" was in no way specific enough to constitute an order that Mackey could not interpose any privilege objection at deposition. ¶33 We find that Mackey did not violate a prior discovery order of the court during the November 19 deposition.",
"The imposition of a sanction default on that basis, therefore, was an abuse of discretion.30 V. THE COURT'S ENTRY OF DAMAGES POST-DEFAULT WITHOUT NOTICE OR HEARING VIOLATED MACKEY'S STATUTORY RIGHTS ¶34 The fact that Mackey was never offered an opportunity to contest the quantum of the money damages awarded against her is also troubling. A default admits the right to recovery, but not the amount of damages. State ex. rel. Okla. Bar Ass'n v. Todd. 1992 OK 81, ¶ 15, 833 P.2d 260.",
"In the assessment of damages following entry of a default judgment, the defaulting party has a statutory right to a hearing on the extent of unliquidated damages. Payne, 1999 OK 93 at ¶ 12. Encompassed within this right is the opportunity to a fair post-default inquest at which both the plaintiff and defendant can participate in the proceedings by cross-examining witnesses and introducing evidence on their own behalf. Id., ¶ 13. A default declaration, imposed as a § 3237 (B) (2) sanction, cannot extend beyond saddling the defendant with liability for the harm occasioned . . . .",
"The trial court must leave to a meaningful inquiry the quantum of actual and punitive damages without stripping the party in default of basic forensic devices to test the truth of the plaintiff's evidence. Id., ¶ 12 (emphasis added). ¶35 In Payne, the district court set a hearing on the quantum of damages, but tried the issue \"sans jury and without participation by Dewitt's counsel.\" Id., ¶ 6. The Supreme Court held that this \"crippling of Dewitt by stripping him of basic due process truth-testing devices is contrary to the orderly process of assessing damages.\" Id., ¶ 14. Despite the clear dictate of Payne, that \"[i]n the assessment of damages following entry of default judgment, a defaulting party has a statutory right to a hearing on the extent of liquidated damages,\" id., ¶12 (emphasis in original), OCFRC argues that the defaulting party must demand that \"statutory right\" before the court is required to respect it.",
"OCFRC argues that Mackey had some form of notice that the court was going to consider damages because she had received the order asking OCFRC to submit a \"damages affidavit,\" and it then became her duty to request a hearing on damages.31 We do not agree that this position complies with Payne. ¶36 Further, even if we were to accept that a court may award unliquidated damages after a default without setting any hearing on the matter and based solely on an affidavit, the record here is clear that Mackey received Camp's affidavit outlining OCFRC's case for damages, at best, less than 24 hours before the court entered its damages award.32 Even if, as proposed by OCFRC, a court is not required to hold a hearing on unliquidated damages after default unless the defendant requests one, it is beyond our ability to comprehend how a defendant might determine he/she wants a hearing without knowing what those requested damages are. ¶37 This crippling of Mackey's basic due process truth-testing devices by depriving her of any opportunity to question or examine Camp's affidavit or other material, finds no support in Oklahoma statutes or case law, and cannot be allowed to stand. VI. THE RECORD IS SILENT ON THE RIGHT TO RECOVER FEES, INCURRED IN THE DEFENSE OF A FEDERAL TITLE VII ACTION, AS DAMAGES ¶38 Because the record is silent as to the trial court's rationale for awarding by default OCFRC's attorney fees in Mackey's federal Title VII action as damages in the state malicious prosecution action, we do not know the underlying legal basis for the award. Although there is a specific federal statute allowing a prevailing defendant in a discrimination suit under Title VII of the Civil Rights Act of 1964 to recover attorney fees, it sets, as a matter of federal policy, a high bar, requiring a showing that the plaintiff's case was frivolous, unreasonable , or without foundation.",
"Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 421-22, 98 S. Ct. 694, 700 (1978). An action is frivolous if it is based on an \"indisputably meritless legal theory,\" or if its \"factual contentions are clearly baseless.\" Neitzke v. Williams, 490 U.S. 319, 327, 109 S. Ct. 1827, 1833 (1989). ¶39 In announcing this standard, the United States Supreme Court cautioned district courts to avoid hindsight logic that equates frivolousness with the plaintiff's ultimate failure to prevail. Christiansburg, 134 U.S. at 421-22, 98 S.Ct. at 700-01. Even \"[a]llegations that, upon careful examination, prove legally insufficient to require a trial are not, for that reason alone, 'groundless' or 'without foundation' as required by Christiansburg.\" Hughes v. Rowe, 449 U.S. 5, 15-16, 101 S.Ct. 173, 179 (1980).",
"So long as the plaintiff has \"some basis\" for the discrimination claim, a prevailing defendant may not recover attorney fees. Obin v. Dist. No. 9 of Internat'l Ass'n of Machinists, 651 F.2d 574, 587 (8th Cir. 1981). We find it clear that summary judgment in the federal case here establishes none of the elements required to recover fees pursuant to these principles.33 A. Seeking Fees for Defending Title VII Cases as Damages in State Courts ¶40 Given the high bar that the U.S. Congress has presented to prevailing defendants attempting to recover fees in a Title VII discrimination suit, Oklahoma courts must exercise careful discretion in awarding such fees as \"damages\" in a state suit decided by default. If the state provides a procedure by which defendants may avoid the high bar to the recovery of fees purposefully set in federal court, it may obstruct the federal purpose embodied in that standard.34 ¶41 Hence, we find it clear that attorney fees incurred in defending a suit under Title VII can only be awarded as damages in an Oklahoma case if the court conducts the inquiry required by Christiansburg and Hughes.",
"We are doubtful that these elements can be established without record evidence merely by the default \"confession\" of a motion pursuant to District Court Rule 4(e). ¶42 More fundamentally, a question arises as to whether a party may choose to seek fees as a remedy in a subsequent action when the same fees were available as a statutory entitlement in the original action. Under the American Rule, a party may not recover attorney fees either as costs or as an element of damages unless a contractual, statutory, or equitable exception applies. It is entirely rational that the state should equitably allow prevailing party fees to be recovered as damages for malicious prosecution when no adequate remedy for this damage is available in the underlying action.",
"It is less rational that the law should allow a prevailing party to file a new suit, in a separate court, attempting to recover fees as damages, when the party was entitled to fees in the prior action, and that party waived the right to seek them. If a party already has an entitlement to fees in one court by virtue of being the prevailing party, we see no rational reason why the law should allow that party to refuse that entitlement and instead begin other proceedings where it must prove additional elements in order to recover the same fees. The entire process ignores the potential application of the preclusion doctrine, offends judicial economy, and implicates forum shopping. ¶43 During oral argument, this Court asked OCFRC if it could provide any authority that a party may decline to seek available fees in an underlying case, and then claim the same fees as damages in a subsequent malicious prosecution action. OCFRC cited Kolosky v. Anchor Hocking Corp., No. CA 83-236, 1984 WL 48997 (W.D. Pa. July 11, 1984), as an example of this process.",
"Kolosky held, at *5 (footnotes omitted): [A] cause of action for malicious prosecution and abuse of process does not lie at this point. However, the Court adds that this does not preclude defendant from instituting a separate action for malicious prosecution and abuse of process if it ultimately prevails in this case. In a related footnote, the court added the following statement: Moreover, this holding does not preclude defendant from moving for attorney's fees and costs, under 42 U.S.C. § 2000e-5(k), if it prevails on the Title VII action. Id. at n.6. ¶44 OCFRC argues that the combination of this paragraph and footnote holds that seeking fees as damages in a malicious prosecution action is simply an alternative remedy to seeking them in the prior Title VII case.",
"We interpret the case differently, and think it more likely that the court held that \". . . a cause of action for malicious prosecution and abuse of process does not lie at this point\" and this holding does not preclude defendant from moving for attorney fees and costs, under 42 U.S.C. § 2000e-5(k), if it prevails on the Title VII action. We do not find Kolosky persuasive here. B. Preclusion/Limitations Questions ¶45 In federal court, if attorney fees are available after the claims have been resolved, the litigant must claim the fees by filing a motion within 14 days of the entry of judgment.",
"Fed. R. Civ. P. 54(d)(2). Although some federal authority provides for tolling this statutory requirement by post-judgment motion (see, e.g., Weyant v. Okst, 198 F.3d 311, 315 (2d Cir. 1999)), OCFRC did not seek fees in the federal case at all, and intentionally allowed its right to recover these fees in the underlying federal action to expire.35 We note that a substantial undecided question exists whether OCFRC may seek these fees as viable damages when they were available in the underlying case but OCFRC declined to seek them within the required time.36 Accordingly, on remand, if OCFRC's fees incurred in the federal case are again presented as damages in the state malicious prosecution case, we urge the trial court to carefully examine whether such fees may be claimed as viable damages, in the first instance, as a matter of law. CONCLUSION ¶46 We emphasize that this case is an unusual one in many aspects. Its irregularity is doubtless exacerbated by the fact that Defendant Mackey was unrepresented by counsel during the pre-sanction and post-sanction proceedings.",
"Nevertheless, the record shows a process that deprived Mackey of due process involving lack of notice and opportunity to be heard. Key relief was twice granted by the court within 24 hours of OCFRC filing documents requesting that relief, and a written order was supplemented months later by a description of an \"oral order\" that substantially changed the nature of the original written order. ¶47 The errors we correct here can be avoided if such matters arise on remand by the entry of appropriate orders which specifically delineate the scope of discovery as provided in the Oklahoma Discovery Code, so as to put a recalcitrant party on notice that violations of these orders may result in sanctions to be determined at a future hearing.",
"Hearings should be noticed and set so as to allow an adequate time for response. If such sanctions should issue, the trial court will be mindful that a post-sanction award of damages must afford an opportunity to the offending party to oppose those damages at an appropriate hearing. ¶48 Accordingly, the trial court's sanction order of default judgment entered against Defendant Mackey, and its subsequent damages award upon default together with attorney's fees and costs, are reversed. The matter is remanded for further proceedings consistent with this opinion. ¶49 REVERSED AND REMANDED FOR FURTHER PROCEEDINGS. WISEMAN, J., and FISCHER, J.",
"(sitting by designation), concur. FOOTNOTES 1 The parties and counsel appeared and presented oral argument on January 10, 2017, at this Court's request. 2 None of the court filings related to the federal case are included in the record on appeal. 3 Reliance on counsel's advice, after \"a full and fair disclosure of known [as distinguished from discoverable] material facts,\" can be, if true, a complete defense to a malicious prosecution claim. Greenberg v. Wolfberg 1994 OK 147, n.30, 890 P.2d 895. 4 Scheduling Order, Record at 30.",
"5 While the record shows that the notice and subpoena were unclaimed, it is undisputed that Mackey had actual notice. 6 Motion to Quash Supoena, Record at 32-33. 7 Motion to Extend Deadlines, Record at 34-35. 8 OCFRC's motion and response, Record at 36-61. 9 Record at 62. 10 Appellant's Brief in Chief at page 4. At oral argument, Mackey's counsel admitted that this fact was circumstantially derived, and there is no record evidence as to any advice of counsel. 11 Title 12 O.S.2011 § 3237(A)(2) provides, \"When taking a deposition on oral examination, the proponent of the question may complete or adjourn the examination before applying for an order [compelling an answer].\" 12 In this motion, OCFRC treats the \"Court Minute\" of November 19, 2014, as the legal equivalent of an order, and asserts that the court ordered Mackey to answer all questions posed without regard to her right to assert her Fifth Amendment privilege under the U.S. Constitution. 13 This claim was abandoned and is not an issue on appeal. 14 District Court Rule 4(c) provides, \"Motions raising fact issues shall be verified by a person having knowledge of the facts, if possible; otherwise, a verified statement by counsel of what the proof will show will suffice until a hearing or stipulation can be provided.\"",
"15 Journal Entry of Judgment, filed June 8, 2015, Record at 141-147. 16 Journal Entry, Record at 143, footnote 1. District Court Rule 4(e) provides that under such circumstances \"the motion may be deemed confessed\" (emphasis added). 17 Journal Entry, Record at 144. 18 Camp's affidavit dated June 26, 2015, and billing records, Record at 150-206. 19 Mackey maintains that whether she received or refused delivery is of little importance since the certified mail receipts show the affidavit and billing records were mailed on the same day the judge entered his decision. See Record at 86-89.",
"20 Final Judgment dated June 30, 2015, Record at page 208. The sum of the damages appears to be based upon the attorney fees Camp maintained were incurred in the federal action. 21 The term \"minute order\" has no legal meaning. Minute orders are never a fit substitute for the judge's recordable memorialized entry, and are, by definition, incomplete. Manning v. State ex.rel. Dept. of Pub. Safety, 1994 OK 62, ¶ 6, 876 P.2d 667. The practice of using \"court minutes\" as the functional equivalent of a recordable entry for the judgment roll, triggering appeal time and memorializing a decision, continues to be problematic and renders the sanction judgment here a nullity. See Mansell v. City of Lawton, 1994 OK 75, 877 P.2d 1120. Justice Winchester, writing for a unanimous Supreme Court in Alexander v. Alexander, 2015 OK 52, ¶ 11, 357 P.3d 481, made clear in language that is impossible not to understand that \"documents titled as court minutes . .",
". . can never constitute a judgment, decree or appealable order.\" Justice Opala, writing separately in Mansell v. City of Lawton, put it even more succinctly, declaring that, \"TRIAL JUDGES SHOULD BE INSTRUCTED TO SIGN ONLY THOSE INSTRUMENTS WHICH THEY INTEND TO BE FILED AND ENTERED ON THE JOURNAL AS JUDGMENTS, DECREES OR ORDERS.\" 1994 OK 75 at ¶ 22 (Opala, J., concurring in result)(emphasis in original). 22 Record at 32-35. 23 Record at 31. 24 During oral argument before this Court on January 10, 2017, counsel for OCFRC stated that he had had some conversations with Mackey regarding the venue for the depositions, but we have no record whether Mackey told counsel that she would not be attending the November 3 deposition. 25 See OCFRC motion and response filed November 18, 2014, Record at 36-51. 26 We find it clear that when Helton and Barnett hold that an order compelling is a prerequisite to sanctions, the sanctioned party must disobey a specific command of the order to compel to justify sanctions. The bare existence of an order compelling discovery does not justify sanctions unless the order's specific commands are breached.",
"27 Subsection E, states in relevant part: If a party . . . fails: 1. To appear before the officer who is to take the deposition, after being served with a proper notice; . . . the court in which the action is pending on motion may make such orders in regard to the failure as are just, and among others it may take any action authorized under subparagraphs a, b and c of paragraph 2 of subsection B of this section. In lieu of or in addition to any order, the court shall require the party failing to act or the attorney advising him or her or both to pay the reasonable expenses, including attorney fees, caused by the failure, unless the court finds that the failure was substantially justified or that other circumstances make an award of expenses unjust. 28 At oral argument before this Court, OCFRC cited a federal trial court order indicating the federal judge's opinion that there is a difference between an order \"setting a deposition\" and one requiring a party to \"submit to a deposition.\" Although federal interpretations of similar federal rules may be persuasive in interpreting the Oklahoma rules (Mehdipour v. State ex rel.",
"Dept. of Corrections, 2004 OK 19, ¶ 18, 90 P.3d 546), we also note that this principle was developed before online reporting of the daily decisions of federal trial judges became common. This new phenomenon has created a situation where the opinions of federal trial judges potentially may be cited as persuasive authority in Oklahoma, while the opinions of Oklahoma's own trial judges may not. 29 We need not address whether such an order would be an abuse of discretion, but note that, at the time these remarks were allegedly made, the only record action by Mackey that may have shown a \"refusal to cooperate\" was her filing of a motion to quash a deposition and extend discovery.",
"We are doubtful that a court would describe the same behavior by an aggressive attorney as a \"cavalier disregard of obligations.\" A pro se litigant is to be held to the same (not higher) standards than a represented party. 30 Because neither the record nor OCFRC's arguments in this appeal warrant doing so, this opinion does not address the district court's authority to enforce discovery orders through contempt proceedings. 31 The original order filed by the court on June 30, 2015, was amended on April 11, 2016, to reflect that Camp's affidavit, together with the billing records, had been expressly ordered submitted to the court, and provided the basis for the court's award of damages and attorney fees. Record at 232-235. 32 Mackey denies receiving the affidavit at all before the court awarded damages. 33 OCFRC argues that the required elements of malicious prosecution would suffice to show an entitlement to fees under the federal standard, and that Mackey \"confessed\" malicious prosecution by failing to answer OCFRC's motion seeking default as a sanction.",
"We will not, at this time, enter this thicket and determine if a party who fails to answer a motion confesses not only the factual allegations of the motion, but also the legal conclusions the movant would have the court draw from those facts. Spirgis v. Circle K Stores, Inc., 1987 OK CIV APP 45, 743 P.2d 682 (approved for publication by the Oklahoma Supreme Court), however, indicates that a court has a responsibility to ensure that summary relief is justified pursuant to the facts confessed, even if the opposing party mounts no opposition. 34 \"To take the further step of assessing attorney's fees against plaintiffs simply because they do not finally prevail would substantially add to the risks inhering in most litigation and would undercut the efforts of Congress to promote the vigorous enforcement of the provisions of Title VII.\" Christiansburg, 434 U.S. at 422, 98 S.Ct.",
"at 701. 35 OCFRC's damages affidavit indicates that it did seek costs in the federal case, but no time is attributed to a fee application. 36 This issue would not arise in a case where a defendant is not entitled to fees in the underlying action, again reinforcing the concept that fees as damages for malicious prosecution may be limited to cases where there is no adequate remedy in the original case. Citationizer© Summary of Documents Citing This Document Cite Name Level None Found. Citationizer: Table of Authority Cite Name Level Oklahoma Court of Civil Appeals Cases CiteNameLevel 1987 OK CIV APP 40, 738 P.2d 1380, 58 OBJ 1617, Hill v. Pierce Mobile Homes, Inc.Discussed 1987 OK CIV APP 45, 743 P.2d 682, 58 OBJ 1702, Spirgis v. Circle K Stores, Inc.Discussed Oklahoma Supreme Court Cases CiteNameLevel 1991 OK 43, 811 P.2d 100, 62 OBJ 1444, Helton v. ColemanDiscussed at Length 1992 OK 81, 833 P.2d 260, 63 OBJ 1714, State ex rel. Oklahoma Bar Ass'n v. ToddDiscussed 2001 OK 25, 21 P.3d 48, 72 OBJ 827, MEADOWS v. WAL-MART STORES, INC.Discussed 1994 OK 62, 876 P.2d 667, 65 OBJ 1940, Manning v. State ex rel.",
"Dept. of Public SafetyDiscussed 1994 OK 75, 877 P.2d 1120, 65 OBJ 2233, Mansell v. City of LawtonDiscussed at Length 1994 OK 147, 890 P.2d 895, 65 OBJ 4220, Greenberg v. WolfbergDiscussed 2002 OK 97, 61 P.3d 234, STATE ex rel. TAL v. CITY OF OKLAHOMA CITYDiscussed 2004 OK 19, 90 P.3d 546, MEHDIPOUR v. STATE ex rel. DEPT. OF CORRECTIONSDiscussed 2008 OK 100, 197 P.3d 12, BARNETT v. SIMMONSDiscussed 1977 OK 17, 561 P.2d 499, BD. OF REGENTS, ETC. v. NAT. COLLEGIATE ATH. ASS'NDiscussed 2015 OK 52, 357 P.3d 481, ALEXANDER v. ALEXANDERDiscussed 1980 OK 161, 619 P.2d 608, Abel v. TisdaleDiscussed 1999 OK 93, 995 P.2d 1088, 70 OBJ 3452, Payne v. DeWittDiscussed at Length 1998 OK 127, 975 P.2d 889, 70 OBJ 34, Martin v. JohnsonDiscussed Title 12. Civil Procedure CiteNameLevel 12 O.S. 3237, 12 O.S. 3237, Failure to Make or Cooperate in Discovery - SanctionsDiscussed at Length"
] | https://www.courtlistener.com/api/rest/v3/opinions/4201469/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
3 N.Y.3d 742 (2004) PEOPLE v. SNYDER Court of Appeals of the State of New York. October 27, 2004. Application in criminal case for leave to appealDenied. (Rosenblatt, J.) (upon reconsideration). | 10-30-2013 | [
"3 N.Y.3d 742 (2004) PEOPLE v. SNYDER Court of Appeals of the State of New York. October 27, 2004. Application in criminal case for leave to appealDenied. (Rosenblatt, J.) (upon reconsideration)."
] | https://www.courtlistener.com/api/rest/v3/opinions/2557414/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
ORDER JOHN W. OLIVER, Senior District Judge. This land condemnation action pends on the government’s objections to the report of *1351the Land Condemnation Commission. After careful consideration, we find and conclude that the objections are without merit and that the report of the Commission in this case should be confirmed and adopted. A land condemnation commission report and award is to be affirmed unless it is clearly erroneous, United States v. 403.14 Acres of Land, 553 F.2d 565 (8th Cir.1977), or it inadequately discloses the approach taken by the Commission. United States v. Merz, 376 U.S. 192, 84 S.Ct. 639, 11 L.Ed.2d 629 (1964). In this case the Commission has not failed in either respect. The government makes three objections to the Commission’s Report: (1) that the Commission erred in concluding that Mr. Scott, the landowner’s appraiser, correctly allowed severance damage to the unencumbered area in the southern portion of the tract for diminished access; (2) that the Commission erred in failing to set out what specific dollar amount it allowed for severance; and (3) that the Commission erred in relying on Mr. Scott’s after sales, which are of a different highest and best use, to determine the after value. The first objection concerns the diminished value of the unencumbered land. In a case such as this where there is a partial taking of a tract of land, the proper measure of just compensation is the difference between the fair and reasonable market value of the entire ownership immediately before the taking and the fair and reasonable market value of the remainder immediately after the taking. United States v. 9.20 Acres of Land, 638 F.2d 1123, 1127 (8th Cir.1981); United States v. 91.90 Acres of Land, 586 F.2d 79, 86 (8th Cir.1978), cert. denied, 441 U.S. 944, 99 S.Ct. 2162, 60 L.Ed.2d 1045 (1979); and United States v. 403.14 Acres of Land, supra, 553 F.2d at 567. This means that in partial taking cases “the landowner is entitled to be compensated not only for the value of his land that is actually taken, but also for the diminution of the value of what is left to him after the taking.” Farmland Preservation Ass’n v. Goldschmidt, 611 F.2d 233, 237 (8th Cir.1979). This diminution of the unencumbered remainder is often and “somewhat loosely,” United States v. Miller, 317 U.S. 369, 63 S.Ct. 276, 87 L.Ed. 336 (1943), referred to as “severance damage.” But generally there is no need to talk about severance damage as such, the “before and after” measure of damage includes within it any diminution to the remainder. United States v. 91.90 Acres of Land, supra, 586 F.2d at 86. Thus, although the government phrases its objections in terms of severance damage, the more appropriate formulation of the question is whether the Commission properly took into consideration all factors of value that would affect the market value of the property immediately after the taking. On page 17 of the Report, the Commission states that the unencumbered area in the southern portion of the tract has been diminished in value by the encumbrance of an access road. This is a question of fact which we must accept unless clearly erroneous. United States v. 403.14 Acres of Land, supra, 553 F.2d at 568. The Commission clearly sets out its reasoning as to why the after value of the remainder would be diminished by the encumbrance of the access and its findings are not clearly erroneous. The first objection shall be overruled. Concerning the second objection, it should again be noted that, in cases such as this where there is a partial taking of a tract of land, the proper measure of compensation is the difference between the “before” and “after” values shown by the evidence. “[T]here is thus no occasion for the making of any special award or determination of ‘severance damage,’ because the matter is included in the finding of what the remainder of the land was worth immediately after the taking.” United States v. 403.14 Acres of Land, etc., supra, at 567, note 2. It is, of course, necessary for the Commission to take into consideration all factors of value that would influence a reasonable buyer and seller, and, as stated above, the Report does show that the Commission did take those factors into account in examining the effect of the diminished access. (See page 17 of the Report). Since *1352it was not necessary for the Commission to set out a specific dollar amount for severance damages, the second objection shall be overruled. The government also objects to the Commission’s reliance on Mr. Scott’s “after” sales. But the Commission did not rely totally on these after sales. The Report examines certain after sales presented by Mr. Scott but the Commission did not accept these sales without qualification — the Report clearly indicates that the Commission believed that Mr. Scott should have applied somewhat larger upward adjustments to the prices of the comparative sales in order to accurately reflect the after value of the subject tract in view of its superi- or location. Furthermore, the Commission also considered and relied on appraisal evidence introduced by the government. In determining after value, the Commission found a comparative sale cited by the government to be “of special assistance” and it placed great reliance on that particular sale. (See pages 17-18 of the Report.) Thus, the government’s third objection is wholly without merit and will therefore be overruled. Accordingly, it is ORDERED (1) that plaintiff’s objections should be and are hereby overruled. It is further ORDERED (2) that the Report of the Commission should be and is hereby adopted. It is further ORDERED (3) that within twenty (20) days of this same order the government shall prepare a form of final judgment in this case. | 11-26-2022 | [
"ORDER JOHN W. OLIVER, Senior District Judge. This land condemnation action pends on the government’s objections to the report of *1351the Land Condemnation Commission. After careful consideration, we find and conclude that the objections are without merit and that the report of the Commission in this case should be confirmed and adopted. A land condemnation commission report and award is to be affirmed unless it is clearly erroneous, United States v. 403.14 Acres of Land, 553 F.2d 565 (8th Cir.1977), or it inadequately discloses the approach taken by the Commission. United States v. Merz, 376 U.S. 192, 84 S.Ct. 639, 11 L.Ed.2d 629 (1964). In this case the Commission has not failed in either respect. The government makes three objections to the Commission’s Report: (1) that the Commission erred in concluding that Mr. Scott, the landowner’s appraiser, correctly allowed severance damage to the unencumbered area in the southern portion of the tract for diminished access; (2) that the Commission erred in failing to set out what specific dollar amount it allowed for severance; and (3) that the Commission erred in relying on Mr. Scott’s after sales, which are of a different highest and best use, to determine the after value.",
"The first objection concerns the diminished value of the unencumbered land. In a case such as this where there is a partial taking of a tract of land, the proper measure of just compensation is the difference between the fair and reasonable market value of the entire ownership immediately before the taking and the fair and reasonable market value of the remainder immediately after the taking. United States v. 9.20 Acres of Land, 638 F.2d 1123, 1127 (8th Cir.1981); United States v. 91.90 Acres of Land, 586 F.2d 79, 86 (8th Cir.1978), cert. denied, 441 U.S. 944, 99 S.Ct. 2162, 60 L.Ed.2d 1045 (1979); and United States v. 403.14 Acres of Land, supra, 553 F.2d at 567. This means that in partial taking cases “the landowner is entitled to be compensated not only for the value of his land that is actually taken, but also for the diminution of the value of what is left to him after the taking.” Farmland Preservation Ass’n v. Goldschmidt, 611 F.2d 233, 237 (8th Cir.1979). This diminution of the unencumbered remainder is often and “somewhat loosely,” United States v. Miller, 317 U.S. 369, 63 S.Ct. 276, 87 L.Ed.",
"336 (1943), referred to as “severance damage.” But generally there is no need to talk about severance damage as such, the “before and after” measure of damage includes within it any diminution to the remainder. United States v. 91.90 Acres of Land, supra, 586 F.2d at 86. Thus, although the government phrases its objections in terms of severance damage, the more appropriate formulation of the question is whether the Commission properly took into consideration all factors of value that would affect the market value of the property immediately after the taking. On page 17 of the Report, the Commission states that the unencumbered area in the southern portion of the tract has been diminished in value by the encumbrance of an access road. This is a question of fact which we must accept unless clearly erroneous.",
"United States v. 403.14 Acres of Land, supra, 553 F.2d at 568. The Commission clearly sets out its reasoning as to why the after value of the remainder would be diminished by the encumbrance of the access and its findings are not clearly erroneous. The first objection shall be overruled. Concerning the second objection, it should again be noted that, in cases such as this where there is a partial taking of a tract of land, the proper measure of compensation is the difference between the “before” and “after” values shown by the evidence. “[T]here is thus no occasion for the making of any special award or determination of ‘severance damage,’ because the matter is included in the finding of what the remainder of the land was worth immediately after the taking.” United States v. 403.14 Acres of Land, etc., supra, at 567, note 2. It is, of course, necessary for the Commission to take into consideration all factors of value that would influence a reasonable buyer and seller, and, as stated above, the Report does show that the Commission did take those factors into account in examining the effect of the diminished access. (See page 17 of the Report).",
"Since *1352it was not necessary for the Commission to set out a specific dollar amount for severance damages, the second objection shall be overruled. The government also objects to the Commission’s reliance on Mr. Scott’s “after” sales. But the Commission did not rely totally on these after sales. The Report examines certain after sales presented by Mr. Scott but the Commission did not accept these sales without qualification — the Report clearly indicates that the Commission believed that Mr. Scott should have applied somewhat larger upward adjustments to the prices of the comparative sales in order to accurately reflect the after value of the subject tract in view of its superi- or location.",
"Furthermore, the Commission also considered and relied on appraisal evidence introduced by the government. In determining after value, the Commission found a comparative sale cited by the government to be “of special assistance” and it placed great reliance on that particular sale. (See pages 17-18 of the Report.) Thus, the government’s third objection is wholly without merit and will therefore be overruled. Accordingly, it is ORDERED (1) that plaintiff’s objections should be and are hereby overruled. It is further ORDERED (2) that the Report of the Commission should be and is hereby adopted. It is further ORDERED (3) that within twenty (20) days of this same order the government shall prepare a form of final judgment in this case."
] | https://www.courtlistener.com/api/rest/v3/opinions/8880756/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Citation Nr: 0606609
Decision Date: 03/08/06 Archive Date: 03/23/06
DOCKET NO. 04-01 197 ) DATE
)
)
On appeal from the
Department of Veterans Affairs Regional Office in Seattle,
Washington
THE ISSUE
Whether the character of the appellant's discharge
constitutes a bar to Department of Veterans Affairs (VA)
benefits (except under Chapter 17 of Title 38 of the United
States Code).
REPRESENTATION
Appellant represented by: Disabled American Veterans
WITNESS AT HEARING ON APPEAL
The appellant
ATTORNEY FOR THE BOARD
W. R. Harryman, Counsel
INTRODUCTION
The appellant served on active duty from March to August
1986.
This appeal to the Board of Veterans' Appeals (Board) arose
from an April 2003 decision of the Department of Veterans
Affairs (VA) Regional Office (RO) in Seattle, Washington.
FINDINGS OF FACT
1. The appellant began active military service in March 1986
and received a discharge under other than honorable
conditions in August 1986.
2. During his period of active service, the appellant
committed the following offenses: absent without leave
(AWOL) for five days, failure to obey a lawful order, and
wrongful use of a controlled substance.
3. The appellant was not insane at the time of the
commission of his offenses.
CONCLUSION OF LAW
The character of the appellant's discharge is a bar to
receiving VA compensation benefits. 38 U.S.C.A. §§ 101(2),
5303 (West 2002); 38 C.F.R. § 3.12(d) (2005).
REASONS AND BASES FOR FINDINGS AND CONCLUSION
The Veterans Claims Assistance Act (VCAA)
The VCAA, Pub. L. No. 106-475, 114 Stat. 2096 (2000)
(codified at 38 U.S.C.A. §§ 5100, 5102-5103A, 5106, 5107,
5126 (West 2002)), imposes obligations on VA in terms of its
duty to notify and assist claimants.
Under the VCAA, when VA receives a complete or substantially
complete application for benefits, it is required to notify
the claimant and his representative, if any, of any
information and medical or lay evidence that is necessary to
substantiate the claim. 38 U.S.C.A. § 5103(a) (West 2002);
38 C.F.R. § 3.159(b) (2004); Quartuccio v. Principi, 16 Vet.
App. 183 (2002). In Pelegrini v. Principi, 18 Vet. App. 112,
120-21 (2004) (Pelegrini II), the United States Court of
Appeals for Veterans Claims (Court) held that VA must inform
the claimant of any information and evidence not of record
(1) that is necessary to substantiate the claim; (2) that VA
will seek to provide; (3) that the claimant is expected to
provide; and (4) request that the claimant provide any
evidence in his possession that pertains to the claim.
In this case, the RO has had an opportunity to consider the
claim on appeal in light of the above-noted change in the
law, and the requirements of the new law and regulations have
been satisfied. See Quartuccio, supra (addressing the duties
imposed by 38 U.S.C. § 5103(a) and 38 C.F.R. § 3.159). By
virtue of the October 2003 statement of the case and the
November 2001 and September 2005 RO letters to the appellant
notifying him of the VCAA, he has been advised of the laws
and regulations governing the claim on appeal and the
evidence that he must supply and the evidence that VA would
attempt to obtain. Thus, he may be considered to have been
advised to submit any pertinent evidence in his possession.
Mayfield v. Nicholson, 19 Vet. App. 103, 128 (2005). The
appellant has not identified any additional evidence not
already associated with the claims folder that is obtainable.
See Conway v. Principi, 353 F. 3d. 1369 (Fed. Cir. 2004).
Therefore, the Board finds that the duty to assist has also
been met.
Also, the Board has considered the Court's holding in
Pelegrini II that 38 U.S.C.A. § 5103(a) requires VA to
provide notice to the claimant and the claimant's
representative, if any, of any information, and any medical
or lay evidence, not previously provided to the Secretary
that is necessary to substantiate the claim before any
initial unfavorable agency of original jurisdiction decision.
Here, the RO initially considered the claims on appeal
subsequent to the passage of the VCAA and the modifications
to 38 U.S.C.A. § 5103(a) therein and following the RO's
notice to the appellant of those provisions. Therefore, the
Board finds no evidence of prejudicial error in proceeding to
a decision on the merits at this juncture. See Mayfield,
supra.
Analysis
The term "veteran" means a person who served in the active
military, naval, or air service, and who was discharged or
released therefrom under conditions other than dishonorable.
38 U.S.C.A. § 101(2); 38 C.F.R. § 3.1(d) (2005). A discharge
or release from active service under conditions other than
dishonorable is a prerequisite to entitlement to VA pension
or compensation benefits. 38 C.F.R. § 3.12(a).
"A person seeking VA benefits must first establish by a
preponderance of the evidence that the service member, upon
whose service such benefits are predicated, has attained the
status of veteran." Holmes v. Brown, 10 Vet. App. 38, 40
(1997).
A discharge or release from service under one of the
following conditions is a bar to the payment of benefits and
is also a bar to benefits under Chapter 17 of Title 38 of the
United States Code unless it is found that the person was
insane at the time of committing the offense causing such
discharge or release.
(1) As a conscientious objector who refused to perform
military duty, wear the uniform, or comply with lawful
order of competent military authorities.
(2) By reason of the sentence of a general court-
martial.
(3) Resignation by an officer for the good of the
service.
(4) As a deserter.
(5) As an alien during a period of hostilities, where it
is affirmatively shown that the former service member
requested his or her release.
(6) By reason of a discharge under other than honorable
conditions issued as a result of an absence without
official leave (AWOL) for a continuous period of at
least 180 days.
38 U.S.C.A. § 5303; 38 C.F.R. §§ 3.12(c), 3.360 (2005).
A discharge or release because of one of the offenses listed
below is considered to have been issued under dishonorable
conditions and is a bar to VA compensation benefits, but not
to benefits under Chapter 17 of Title 38.
(1) Acceptance of an undesirable discharge to escape
trial by general court-martial.
(2) Mutiny or spying.
(3) An offense involving moral turpitude. This
includes, generally, conviction of a felony.
(4) Willful and persistent misconduct. This includes a
discharge under other than honorable conditions, if it
is determined that it was issued because of willful and
persistent misconduct. A discharge because of a minor
offense will not, however, be considered willful and
persistent misconduct if service was otherwise honest,
faithful and meritorious.
(5) Homosexual acts involving aggravating circumstances
or other factors affecting the performance of duty.
38 C.F.R. § 3.12(d).
The record shows the appellant enlisted in the military in
March 1986. He received non-judicial punishment in July 1986
for an unauthorized absence of five days, failure to obey a
lawful order, and wrongful use of a controlled substance.
He waived his right to counsel and accepted an administrative
discharge in August 1986 in lieu of a Captain's Mast based on
misconduct due to drug abuse.
The record also contains a signed acknowledgement by the
appellant in April 1986 that he had been briefed on the
service department's zero-tolerance policy on drug abuse.
The appellant applied to the Board of Correction of Naval
Records in April 2002 for an upgrade of his discharge. The
Board denied his application after carefully weighing all
potentially mitigating factors. The Board found that his use
of drugs outweighed those factors.
The appellant testified at a hearing at the RO in November
2005, chaired by the undersigned Veterans Law Judge (VLJ) of
the Board. During the proceeding, he reiterated his
contention that compensation should be payable for medical
conditions that were diagnosed in service. He also alleged
that his discharge has been upgraded, as evidenced by his
revised DD Form 214, which he said the RO received in March
2002 even prior to its administrative decision at issue
in April 2003, but apparently did not consider.
The "revised" DD Form 214 to which the appellant refers is
not authentic. Revisions to DD Form 214s are made on DD Form
215s (not 214s). And this document also list a different
address than his. Thus, irrespective of this document,
because the service department characterized his discharge as
"other than honorable," VA must determine whether the
circumstances of his discharge were such as to constitute
dishonorable conditions, for purposes of VA benefits.
The Board observes that none of the conditions listed at
38 C.F.R. § 3.12(c) is relevant to this case. The Board also
notes that the only condition listed at 38 C.F.R. § 3.12(d)
that might be relevant is the one relating to willful and
persistent misconduct.
The offenses that led to the appellant's discharge were an
unauthorized absence of five days, failure to obey a lawful
order, and wrongful use of a controlled substance. A single,
brief unauthorized absence or a single instance of
disobedience might be considered a minor offense so as not to
constitute willful and persistent misconduct. Considering
the service department's zero-tolerance policy regarding drug
abuse and the potential effect drug abuse can have on a
service member's ability to perform his job properly and
safely, however, the Board finds that even a single instance
of such drug abuse cannot be considered a minor offense.
There is no evidence, nor does the appellant otherwise
allege, that he was insane at the time of the commission of
the offenses for which he accepted an administrative
discharge. Accordingly, the exception provided for the bar
to benefits predicated on misconduct based upon a finding of
insanity is not applicable. See 38 U.S.C.A. § 5303(b); 38
C.F.R. § 3.12(b).
Viewing all of the appellant's offenses together, the Board
finds that they constitute will and persistent misconduct.
Accordingly, the Board finds that his discharge was under
dishonorable conditions for VA purposes. Such a finding
constitutes a bar to payment of VA compensation benefits. 38
C.F.R. § 3.12(d).
The Board would point out that, because the Board has
determined that the factors enumerated at 38 U.S.C.A.
§ 5303(a); 38 C.F.R. § 3.12(c) are not applicable in this
case, the appellant's receipt of VA healthcare benefits under
Chapter 17 of Title 38 of the United States Code is not
barred for disabilities found to be service-connected.
ORDER
The character of the appellant's discharge from service for
the period from March to August 1986 constitutes a bar to VA
compensation benefits. The appeal therefore is denied.
____________________________________________
KEITH W. ALLEN
Veterans Law Judge, Board of Veterans' Appeals
Department of Veterans Affairs | 03-08-2006 | [
"Citation Nr: 0606609 Decision Date: 03/08/06 Archive Date: 03/23/06 DOCKET NO. 04-01 197 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Seattle, Washington THE ISSUE Whether the character of the appellant's discharge constitutes a bar to Department of Veterans Affairs (VA) benefits (except under Chapter 17 of Title 38 of the United States Code). REPRESENTATION Appellant represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL The appellant ATTORNEY FOR THE BOARD W. R. Harryman, Counsel INTRODUCTION The appellant served on active duty from March to August 1986. This appeal to the Board of Veterans' Appeals (Board) arose from an April 2003 decision of the Department of Veterans Affairs (VA) Regional Office (RO) in Seattle, Washington. FINDINGS OF FACT 1. The appellant began active military service in March 1986 and received a discharge under other than honorable conditions in August 1986. 2. During his period of active service, the appellant committed the following offenses: absent without leave (AWOL) for five days, failure to obey a lawful order, and wrongful use of a controlled substance.",
"3. The appellant was not insane at the time of the commission of his offenses. CONCLUSION OF LAW The character of the appellant's discharge is a bar to receiving VA compensation benefits. 38 U.S.C.A. §§ 101(2), 5303 (West 2002); 38 C.F.R. § 3.12(d) (2005). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veterans Claims Assistance Act (VCAA) The VCAA, Pub. L. No. 106-475, 114 Stat. 2096 (2000) (codified at 38 U.S.C.A. §§ 5100, 5102-5103A, 5106, 5107, 5126 (West 2002)), imposes obligations on VA in terms of its duty to notify and assist claimants. Under the VCAA, when VA receives a complete or substantially complete application for benefits, it is required to notify the claimant and his representative, if any, of any information and medical or lay evidence that is necessary to substantiate the claim. 38 U.S.C.A. § 5103(a) (West 2002); 38 C.F.R. § 3.159(b) (2004); Quartuccio v. Principi, 16 Vet.",
"App. 183 (2002). In Pelegrini v. Principi, 18 Vet. App. 112, 120-21 (2004) (Pelegrini II), the United States Court of Appeals for Veterans Claims (Court) held that VA must inform the claimant of any information and evidence not of record (1) that is necessary to substantiate the claim; (2) that VA will seek to provide; (3) that the claimant is expected to provide; and (4) request that the claimant provide any evidence in his possession that pertains to the claim. In this case, the RO has had an opportunity to consider the claim on appeal in light of the above-noted change in the law, and the requirements of the new law and regulations have been satisfied. See Quartuccio, supra (addressing the duties imposed by 38 U.S.C.",
"§ 5103(a) and 38 C.F.R. § 3.159). By virtue of the October 2003 statement of the case and the November 2001 and September 2005 RO letters to the appellant notifying him of the VCAA, he has been advised of the laws and regulations governing the claim on appeal and the evidence that he must supply and the evidence that VA would attempt to obtain. Thus, he may be considered to have been advised to submit any pertinent evidence in his possession.",
"Mayfield v. Nicholson, 19 Vet. App. 103, 128 (2005). The appellant has not identified any additional evidence not already associated with the claims folder that is obtainable. See Conway v. Principi, 353 F. 3d. 1369 (Fed. Cir. 2004). Therefore, the Board finds that the duty to assist has also been met. Also, the Board has considered the Court's holding in Pelegrini II that 38 U.S.C.A. § 5103(a) requires VA to provide notice to the claimant and the claimant's representative, if any, of any information, and any medical or lay evidence, not previously provided to the Secretary that is necessary to substantiate the claim before any initial unfavorable agency of original jurisdiction decision. Here, the RO initially considered the claims on appeal subsequent to the passage of the VCAA and the modifications to 38 U.S.C.A. § 5103(a) therein and following the RO's notice to the appellant of those provisions. Therefore, the Board finds no evidence of prejudicial error in proceeding to a decision on the merits at this juncture.",
"See Mayfield, supra. Analysis The term \"veteran\" means a person who served in the active military, naval, or air service, and who was discharged or released therefrom under conditions other than dishonorable. 38 U.S.C.A. § 101(2); 38 C.F.R. § 3.1(d) (2005). A discharge or release from active service under conditions other than dishonorable is a prerequisite to entitlement to VA pension or compensation benefits.",
"38 C.F.R. § 3.12(a). \"A person seeking VA benefits must first establish by a preponderance of the evidence that the service member, upon whose service such benefits are predicated, has attained the status of veteran.\" Holmes v. Brown, 10 Vet. App. 38, 40 (1997). A discharge or release from service under one of the following conditions is a bar to the payment of benefits and is also a bar to benefits under Chapter 17 of Title 38 of the United States Code unless it is found that the person was insane at the time of committing the offense causing such discharge or release. (1) As a conscientious objector who refused to perform military duty, wear the uniform, or comply with lawful order of competent military authorities. (2) By reason of the sentence of a general court- martial. (3) Resignation by an officer for the good of the service. (4) As a deserter. (5) As an alien during a period of hostilities, where it is affirmatively shown that the former service member requested his or her release. (6) By reason of a discharge under other than honorable conditions issued as a result of an absence without official leave (AWOL) for a continuous period of at least 180 days. 38 U.S.C.A.",
"§ 5303; 38 C.F.R. §§ 3.12(c), 3.360 (2005). A discharge or release because of one of the offenses listed below is considered to have been issued under dishonorable conditions and is a bar to VA compensation benefits, but not to benefits under Chapter 17 of Title 38. (1) Acceptance of an undesirable discharge to escape trial by general court-martial. (2) Mutiny or spying. (3) An offense involving moral turpitude. This includes, generally, conviction of a felony. (4) Willful and persistent misconduct.",
"This includes a discharge under other than honorable conditions, if it is determined that it was issued because of willful and persistent misconduct. A discharge because of a minor offense will not, however, be considered willful and persistent misconduct if service was otherwise honest, faithful and meritorious. (5) Homosexual acts involving aggravating circumstances or other factors affecting the performance of duty. 38 C.F.R. § 3.12(d). The record shows the appellant enlisted in the military in March 1986. He received non-judicial punishment in July 1986 for an unauthorized absence of five days, failure to obey a lawful order, and wrongful use of a controlled substance. He waived his right to counsel and accepted an administrative discharge in August 1986 in lieu of a Captain's Mast based on misconduct due to drug abuse. The record also contains a signed acknowledgement by the appellant in April 1986 that he had been briefed on the service department's zero-tolerance policy on drug abuse. The appellant applied to the Board of Correction of Naval Records in April 2002 for an upgrade of his discharge. The Board denied his application after carefully weighing all potentially mitigating factors. The Board found that his use of drugs outweighed those factors. The appellant testified at a hearing at the RO in November 2005, chaired by the undersigned Veterans Law Judge (VLJ) of the Board.",
"During the proceeding, he reiterated his contention that compensation should be payable for medical conditions that were diagnosed in service. He also alleged that his discharge has been upgraded, as evidenced by his revised DD Form 214, which he said the RO received in March 2002 even prior to its administrative decision at issue in April 2003, but apparently did not consider. The \"revised\" DD Form 214 to which the appellant refers is not authentic. Revisions to DD Form 214s are made on DD Form 215s (not 214s). And this document also list a different address than his. Thus, irrespective of this document, because the service department characterized his discharge as \"other than honorable,\" VA must determine whether the circumstances of his discharge were such as to constitute dishonorable conditions, for purposes of VA benefits. The Board observes that none of the conditions listed at 38 C.F.R. § 3.12(c) is relevant to this case. The Board also notes that the only condition listed at 38 C.F.R.",
"§ 3.12(d) that might be relevant is the one relating to willful and persistent misconduct. The offenses that led to the appellant's discharge were an unauthorized absence of five days, failure to obey a lawful order, and wrongful use of a controlled substance. A single, brief unauthorized absence or a single instance of disobedience might be considered a minor offense so as not to constitute willful and persistent misconduct. Considering the service department's zero-tolerance policy regarding drug abuse and the potential effect drug abuse can have on a service member's ability to perform his job properly and safely, however, the Board finds that even a single instance of such drug abuse cannot be considered a minor offense.",
"There is no evidence, nor does the appellant otherwise allege, that he was insane at the time of the commission of the offenses for which he accepted an administrative discharge. Accordingly, the exception provided for the bar to benefits predicated on misconduct based upon a finding of insanity is not applicable. See 38 U.S.C.A. § 5303(b); 38 C.F.R. § 3.12(b). Viewing all of the appellant's offenses together, the Board finds that they constitute will and persistent misconduct. Accordingly, the Board finds that his discharge was under dishonorable conditions for VA purposes. Such a finding constitutes a bar to payment of VA compensation benefits.",
"38 C.F.R. § 3.12(d). The Board would point out that, because the Board has determined that the factors enumerated at 38 U.S.C.A. § 5303(a); 38 C.F.R. § 3.12(c) are not applicable in this case, the appellant's receipt of VA healthcare benefits under Chapter 17 of Title 38 of the United States Code is not barred for disabilities found to be service-connected. ORDER The character of the appellant's discharge from service for the period from March to August 1986 constitutes a bar to VA compensation benefits. The appeal therefore is denied. ____________________________________________ KEITH W. ALLEN Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs"
] | https://drive.google.com/drive/folders/12lAd8Os7VFeqbTKi4wcqJqODjHIn0-yQ?usp=sharing | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
REASONS FOR ALLOWANCE It is noted by the examiner, and stated here for the record of prosecution, that the aspect of the instant invention determined to be novel and patentably distinct from the prior art is the second control unit being configured to close the valve at a beginning of the one cycle and open the valve when the first pump and the second pump stop, and the first control unit being configured to apply a first drive voltage to the upstream side pump and a second drive voltage to the downstream side pump, wherein a length of time from the beginning of the one cycle of the drive control cycle to a time at which the first drive voltage reaches a first normal operation drive voltage is longer than a length of time from the beginning of the one cycle to a time at which the second drive voltage reaches a second normal operation drive voltage. These limitations, in combination with a first pump including a first hole and a second hole, the first pump being operable to move fluid between the first hole and the second hole, a second pump including a third hole and a fourth hole, the second pump being operable to move fluid between the third hole and the fourth hole, a container; a first communicating path communicating with the second hole and the third hole; a second communicating path communicating with the fourth hole and the container, a valve installed in the second communicating path, the valve being operable between an open state that opens the second communicating path to outside and a closed state that closes the second communicating path from the outside, and a first control unit being configured to control driving of the first pump and the second pump to perform a drive control cycle that repeatedly starts and stops operation of the first pump and the second pump, make the claim read over the prior art. The sum of these limitations is not disclosed by the prior art and it would not be obvious to combine references in an effort to meet all of the claimed elements. Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.”
Conclusion Any inquiry concerning this communication or earlier communications from the examiner should be directed to Peter J Bertheaud whose telephone number is (571)272-3476. The examiner can normally be reached 9am - 5pm M-F. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Devon Kramer can be reached on 5712727118. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of published or unpublished applications may be obtained from Patent Center. Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format. For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000.
PJB /PETER J BERTHEAUD/Primary Examiner, Art Unit 3746 | 2022-05-13T13:51:10 | [
"REASONS FOR ALLOWANCE It is noted by the examiner, and stated here for the record of prosecution, that the aspect of the instant invention determined to be novel and patentably distinct from the prior art is the second control unit being configured to close the valve at a beginning of the one cycle and open the valve when the first pump and the second pump stop, and the first control unit being configured to apply a first drive voltage to the upstream side pump and a second drive voltage to the downstream side pump, wherein a length of time from the beginning of the one cycle of the drive control cycle to a time at which the first drive voltage reaches a first normal operation drive voltage is longer than a length of time from the beginning of the one cycle to a time at which the second drive voltage reaches a second normal operation drive voltage.",
"These limitations, in combination with a first pump including a first hole and a second hole, the first pump being operable to move fluid between the first hole and the second hole, a second pump including a third hole and a fourth hole, the second pump being operable to move fluid between the third hole and the fourth hole, a container; a first communicating path communicating with the second hole and the third hole; a second communicating path communicating with the fourth hole and the container, a valve installed in the second communicating path, the valve being operable between an open state that opens the second communicating path to outside and a closed state that closes the second communicating path from the outside, and a first control unit being configured to control driving of the first pump and the second pump to perform a drive control cycle that repeatedly starts and stops operation of the first pump and the second pump, make the claim read over the prior art.",
"The sum of these limitations is not disclosed by the prior art and it would not be obvious to combine references in an effort to meet all of the claimed elements. Any comments considered necessary by applicant must be submitted no later than the payment of the issue fee and, to avoid processing delays, should preferably accompany the issue fee. Such submissions should be clearly labeled “Comments on Statement of Reasons for Allowance.” Conclusion Any inquiry concerning this communication or earlier communications from the examiner should be directed to Peter J Bertheaud whose telephone number is (571)272-3476. The examiner can normally be reached 9am - 5pm M-F. Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Devon Kramer can be reached on 5712727118. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300. Information regarding the status of published or unpublished applications may be obtained from Patent Center.",
"Unpublished application information in Patent Center is available to registered users. To file and manage patent submissions in Patent Center, visit: https://patentcenter.uspto.gov. Visit https://www.uspto.gov/patents/apply/patent-center for more information about Patent Center and https://www.uspto.gov/patents/docx for information about filing in DOCX format. For additional questions, contact the Electronic Business Center (EBC) at 866-217-9197 (toll-free). If you would like assistance from a USPTO Customer Service Representative, call 800-786-9199 (IN USA OR CANADA) or 571-272-1000. PJB /PETER J BERTHEAUD/Primary Examiner, Art Unit 3746"
] | https://dh-opendata.s3.amazonaws.com/bdr-oa-bulkdata/weekly/bdr_oa_bulkdata_weekly_2022-05-15.zip | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Exhibit 10.04
[g255521kqi001.jpg]
September 15, 2008
ARTISTdirect, Inc.
1601 Cloverfield Blvd., Suite 400
Santa Monica, CA 90404
Attention: Mr. Dimitri Villard
Interim Chief Executive Officer
This amendment (the “Amendment”) to the letter (the “Engagement Letter”) dated February 7, 2008 hereby terminates the Engagement of Salem Partners LLC (“Salem Partners”) by ARTISTdirect, Inc. (the “Company”) pursuant to the Engagement Letter and releases Salem Partners and the Company from all future obligations thereunder, except those detailed in the Engagement Letter as surviving any termination of the Engagement. Notwithstanding the foregoing, the parties acknowledge that the Company will immediately pay Salem Partners a non-refundable cash fee of $125,000 and that the Company shall not have any obligation to make any other payments to Salem Partners.
Please confirm that the foregoing is in accordance with your understanding and agreement by signing where indicated below and returning to us the duplicate of the Amendment enclosed herewith, whereupon the Amendment will constitute our binding agreement with respect to the matters set forth herein.
Very truly yours,
SALEM PARTNERS LLC
By:
/s/ Stephen Prough
Name: Stephen Prough
Title: Managing Director
CONFIRMED AND AGREED:
ARTISTDIRECT, INC.
By:
/s/ Dimitir Villard
Name: Dimitri Villard
Title: Chief Executive Officer
-------------------------------------------------------------------------------- | [
"Exhibit 10.04 [g255521kqi001.jpg] September 15, 2008 ARTISTdirect, Inc. 1601 Cloverfield Blvd., Suite 400 Santa Monica, CA 90404 Attention: Mr. Dimitri Villard Interim Chief Executive Officer This amendment (the “Amendment”) to the letter (the “Engagement Letter”) dated February 7, 2008 hereby terminates the Engagement of Salem Partners LLC (“Salem Partners”) by ARTISTdirect, Inc. (the “Company”) pursuant to the Engagement Letter and releases Salem Partners and the Company from all future obligations thereunder, except those detailed in the Engagement Letter as surviving any termination of the Engagement. Notwithstanding the foregoing, the parties acknowledge that the Company will immediately pay Salem Partners a non-refundable cash fee of $125,000 and that the Company shall not have any obligation to make any other payments to Salem Partners. Please confirm that the foregoing is in accordance with your understanding and agreement by signing where indicated below and returning to us the duplicate of the Amendment enclosed herewith, whereupon the Amendment will constitute our binding agreement with respect to the matters set forth herein. Very truly yours, SALEM PARTNERS LLC By: /s/ Stephen Prough Name: Stephen Prough Title: Managing Director CONFIRMED AND AGREED: ARTISTDIRECT, INC. By: /s/ Dimitir Villard Name: Dimitri Villard Title: Chief Executive Officer --------------------------------------------------------------------------------"
] | https://github.com/TheAtticusProject/cuad | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
|
PER CURIAM. The appellant’s conviction and sentence are affirmed. However, we note an ambiguity in the restitution order dated November 1, 1991. One provision of that order reflects that restitution is denied while another provides that it is ordered in the sum of $41,701.65. The record reflects that the court was not going to order it “at this time.” We therefore reverse the sentence in part and remand so that any ambiguity may be resolved. ANSTEAD, STONE and WARNER, JJ., concur. | 07-29-2022 | [
"PER CURIAM. The appellant’s conviction and sentence are affirmed. However, we note an ambiguity in the restitution order dated November 1, 1991. One provision of that order reflects that restitution is denied while another provides that it is ordered in the sum of $41,701.65. The record reflects that the court was not going to order it “at this time.” We therefore reverse the sentence in part and remand so that any ambiguity may be resolved. ANSTEAD, STONE and WARNER, JJ., concur."
] | https://www.courtlistener.com/api/rest/v3/opinions/7602724/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13G Under the Securities Exchange Act of 1934 Direxion Shares ETF Trust (Name of Issuer) Direxion All Cap Insider Sentiment Shares (Title of Class of Securities) 25459Y769 (CUSIP Number) December 31, 2016 (Date of Event which Requires Filing of this Statement) Check the appropriate box to designate the rule pursuant to which this Schedule is filed: [X] Rule 13d-1(b) [] Rule 13d-1(c) [] Rule 13d-1(d) * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required in the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see Instructions). CUSIP No.: 25459Y769 1 NAME OF REPORTING PERSON Stifel, Nicolaus & Company, Incorporated I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) 43-0538770 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [] (b) [] 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION Missouri NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH 5 SOLE VOTING POWER 153,237 6 SHARED VOTING POWER 0 7 SOLE DISPOSITIVE POWER 153,237 8 SHARED DISPOSITIVE POWER 0 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 153,237 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [] 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) 6.81% 12 TYPE OF REPORTING PERSON IA CUSIP No.: 25459Y769 ITEM 1(a). NAME OF ISSUER: Direxion Shares ETF Trust ITEM 1(b). ADDRESS OF ISSUER'S PRINCIPAL EXECUTIVE OFFICES: 1(6TH AVENUE)35TH FLOORNEW YORK NY 10019 ITEM 2(a). NAME OF PERSON FILING: Stifel, Nicolaus & Company, Incorporated ITEM 2(b). ADDRESS OF PRINCIPAL BUSINESS OFFICE OR, IF NONE, RESIDENCE: 501 North BroadwaySt. Louis, MO 63102 ITEM 2(c). CITIZENSHIP: Missouri ITEM 2(d). TITLE OF CLASS OF SECURITIES: Direxion All Cap Insider Sentiment Shares ITEM 2(e). CUSIP NUMBER: 25459Y769 ITEM 3. IF THIS STATEMENT IS FILED PURSUANT TO SECTION 240.13d-1(b), or 13d-2(b) or (c) CHECK WHETHER THE PERSON FILING IS A: (a) [ ] Broker or dealer registered under Section 15 of the Act (15 U.S.C. 78c); (b) [ ] Bank as defined in Section 3(a)(6) of the Act (15 U.S.C. 78c); (c) [ ] Insurance company as defined in Section 3(a)(19) of the Act (15 U.S.C. 78c); (d) [ ] Investment company registered under Section 8 of the Investment Company Act of 1940 (15 U.S.C 80a-8); (e) [X] An investment adviser in accordance with 240.13d-1(b)(1)(ii)(E); (f) [ ] An employee benefit plan or endowment fund in accordance with 240.13d-1(b)(1)(ii)(F); (g) [ ] A parent holding company or control person in accordance with 240.13d-1(b)(1)(ii)(G); (h) [ ] A savings associations as defined in Section 3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813); (i) [ ] A church plan that is excluded from the definition of an investment company under Section 3(c)(14) of the Investment Company Act of 1940 (15 U.S.C. 80a-3); (j) [ ] A non-U.S. institution in accordance with 240.13d-1(b)(1)(ii)(J); (k) [ ] Group, in accordance with 240.13d-1(b)(1)(ii)(K). If filing as a non-U.S. institution in accordance with 240.13d1(b)(1)(ii)(J), please specify the type of institution: ITEM 4. OWNERSHIP (a) Amount beneficially owned: 153,237 (b) Percent of class: 6.81% (c) Number of shares as to which the person has: (i) sole power to vote or to direct the vote: 153,237 (ii) shared power to vote or to direct the vote: 0 (iii) sole power to dispose or direct the disposition of: 153,237 (iv) shared power to dispose or to direct the disposition of: 0 ITEM 5. OWNERSHIP OF FIVE PERCENT OR LESS OF A CLASS: If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the beneficial owner of more than five percent of the class of securities, check the following [ ]. ITEM 6. OWNERSHIP OF MORE THAN FIVE PERCENT ON BEHALF OF ANOTHER PERSON: THE SHARES REPORTED IN THIS SCHEDULE 13G ARE HELD ON AN AGGREGATE BASIS IN CLIENT ACCOUNTS OVER WHICH STIFEL, NICOLAUS & COMPANY, INCORPORATED HAS DISCRETIONARY AUTHORITY. STIFEL IS NOT CONCLUSIVELY CLAIMING BENEFICIAL OWNERSHIP IN THESE SHARES AS A RESULT OF THIS FILING. ITEM 7. IDENTIFICATION AND CLASSIFICATION OF THE SUBSIDIARY WHICH ACQUIRED THE SECURITY BEING REPORTED ON BY THE PARENT HOLDING COMPANY: Not Applicable ITEM 8. IDENTIFICATION AND CLASSIFICATION OF MEMBERS OF THE GROUP: Not Applicable ITEM 9. NOTICE OF DISSOLUTION OF GROUP: Not Applicable ITEM 10. CERTIFICATION: By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect. CUSIP No.: 25459Y769 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. February 14 2017 Stifel, Nicolaus & Company, Incorporated By: /s/ Name: Rita Kazembe Title: Chief Compliance Officer Advisory Services Attention — Intentional misstatements or omissions of fact constitute Federal criminal violations (See 18 U.S.C. 1001). | [
"UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13G Under the Securities Exchange Act of 1934 Direxion Shares ETF Trust (Name of Issuer) Direxion All Cap Insider Sentiment Shares (Title of Class of Securities) 25459Y769 (CUSIP Number) December 31, 2016 (Date of Event which Requires Filing of this Statement) Check the appropriate box to designate the rule pursuant to which this Schedule is filed: [X] Rule 13d-1(b) [] Rule 13d-1(c) [] Rule 13d-1(d) * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required in the remainder of this cover page shall not be deemed to be \"filed\" for the purpose of Section 18 of the Securities Exchange Act of 1934 (\"Act\") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see Instructions). CUSIP No.",
": 25459Y769 1 NAME OF REPORTING PERSON Stifel, Nicolaus & Company, Incorporated I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) 43-0538770 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [] (b) [] 3 SEC USE ONLY 4 CITIZENSHIP OR PLACE OF ORGANIZATION Missouri NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH 5 SOLE VOTING POWER 153,237 6 SHARED VOTING POWER 0 7 SOLE DISPOSITIVE POWER 153,237 8 SHARED DISPOSITIVE POWER 0 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 153,237 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [] 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) 6.81% 12 TYPE OF REPORTING PERSON IA CUSIP No. : 25459Y769 ITEM 1(a). NAME OF ISSUER: Direxion Shares ETF Trust ITEM 1(b).",
"ADDRESS OF ISSUER'S PRINCIPAL EXECUTIVE OFFICES: 1(6TH AVENUE)35TH FLOORNEW YORK NY 10019 ITEM 2(a). NAME OF PERSON FILING: Stifel, Nicolaus & Company, Incorporated ITEM 2(b). ADDRESS OF PRINCIPAL BUSINESS OFFICE OR, IF NONE, RESIDENCE: 501 North BroadwaySt. Louis, MO 63102 ITEM 2(c). CITIZENSHIP: Missouri ITEM 2(d). TITLE OF CLASS OF SECURITIES: Direxion All Cap Insider Sentiment Shares ITEM 2(e). CUSIP NUMBER: 25459Y769 ITEM 3. IF THIS STATEMENT IS FILED PURSUANT TO SECTION 240.13d-1(b), or 13d-2(b) or (c) CHECK WHETHER THE PERSON FILING IS A: (a) [ ] Broker or dealer registered under Section 15 of the Act (15 U.S.C. 78c); (b) [ ] Bank as defined in Section 3(a)(6) of the Act (15 U.S.C. 78c); (c) [ ] Insurance company as defined in Section 3(a)(19) of the Act (15 U.S.C.",
"78c); (d) [ ] Investment company registered under Section 8 of the Investment Company Act of 1940 (15 U.S.C 80a-8); (e) [X] An investment adviser in accordance with 240.13d-1(b)(1)(ii)(E); (f) [ ] An employee benefit plan or endowment fund in accordance with 240.13d-1(b)(1)(ii)(F); (g) [ ] A parent holding company or control person in accordance with 240.13d-1(b)(1)(ii)(G); (h) [ ] A savings associations as defined in Section 3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813); (i) [ ] A church plan that is excluded from the definition of an investment company under Section 3(c)(14) of the Investment Company Act of 1940 (15 U.S.C. 80a-3); (j) [ ] A non-U.S. institution in accordance with 240.13d-1(b)(1)(ii)(J); (k) [ ] Group, in accordance with 240.13d-1(b)(1)(ii)(K). If filing as a non-U.S. institution in accordance with 240.13d1(b)(1)(ii)(J), please specify the type of institution: ITEM 4.",
"OWNERSHIP (a) Amount beneficially owned: 153,237 (b) Percent of class: 6.81% (c) Number of shares as to which the person has: (i) sole power to vote or to direct the vote: 153,237 (ii) shared power to vote or to direct the vote: 0 (iii) sole power to dispose or direct the disposition of: 153,237 (iv) shared power to dispose or to direct the disposition of: 0 ITEM 5. OWNERSHIP OF FIVE PERCENT OR LESS OF A CLASS: If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the beneficial owner of more than five percent of the class of securities, check the following [ ]. ITEM 6. OWNERSHIP OF MORE THAN FIVE PERCENT ON BEHALF OF ANOTHER PERSON: THE SHARES REPORTED IN THIS SCHEDULE 13G ARE HELD ON AN AGGREGATE BASIS IN CLIENT ACCOUNTS OVER WHICH STIFEL, NICOLAUS & COMPANY, INCORPORATED HAS DISCRETIONARY AUTHORITY.",
"STIFEL IS NOT CONCLUSIVELY CLAIMING BENEFICIAL OWNERSHIP IN THESE SHARES AS A RESULT OF THIS FILING. ITEM 7. IDENTIFICATION AND CLASSIFICATION OF THE SUBSIDIARY WHICH ACQUIRED THE SECURITY BEING REPORTED ON BY THE PARENT HOLDING COMPANY: Not Applicable ITEM 8. IDENTIFICATION AND CLASSIFICATION OF MEMBERS OF THE GROUP: Not Applicable ITEM 9. NOTICE OF DISSOLUTION OF GROUP: Not Applicable ITEM 10. CERTIFICATION: By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect. CUSIP No. : 25459Y769 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.",
"February 14 2017 Stifel, Nicolaus & Company, Incorporated By: /s/ Name: Rita Kazembe Title: Chief Compliance Officer Advisory Services Attention — Intentional misstatements or omissions of fact constitute Federal criminal violations (See 18 U.S.C. 1001)."
] | https://applica-public.s3-eu-west-1.amazonaws.com/contract-discovery/edgar.txt.xz | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
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ROTHENBERG, J. E.V., a juvenile, appeals the trial court’s order denying his motion to suppress evidence and the subsequent order withholding adjudication of delinquency for possession of cannabis. E.V. contends that the police encounter leading to the discovery of the evidence against him was not consensual and was not supported by reasonable suspicion. Because the record supports the trial court’s finding that the encounter was consensual, we affirm. Although the arresting officer’s and E.V.’s recitation of the facts differed, the trial court, based on its credibility determinations, found the officer’s testimony credible. The officer testified that after observing E.V. standing outside of a gas station for approximately thirty minutes, he decided to investigate. He therefore exited his patrol car and asked E.V. to come towards him. As he and E.V. walked towards each other, the officer got closer to E.V. and smelled burnt marijuana emanating from E.V.’s clothing. When he asked E.V. about the marijuana smell, E.V. immediately handed the officer a small baggie of marijuana and told the officer where E.V. had acquired it. The trial court concluded that the encounter was consensual and therefore denied E.V.’s motion to suppress the evidence. A trial court’s ruling on a motion to suppress evidence presents a mixed question of fact and law whereby the reviewing court bestows a presumption of correctness to the trial court’s findings of fact, but reviews the application of law to those facts de novo. Connor v. State, 803 So.2d 598, 608 (Fla.2001). The presumption of correctness cloaking the trial court’s findings of fact is rebutted only if there is no competent substantial record evidence supporting that factual determination. Id. “A consensual encounter is one in which a reasonable person would feel free to disre*1165gard the police and go about his business. A consensual encounter does not require the police to have a reasonable suspicion of any improper conduct before initiating conversation.” Chapman v. State, 780 So.2d 1036, 1037 (Fla. 4th DCA 2001) (internal citation omitted) (citing Voorhees v. State, 699 So.2d 602, 608 (Fla.1997)). When determining whether an encounter with the police is consensual, the court must base its determination on the totality of the circumstances. Caldwell v. State, 41 So.3d 188, 197-99 (Fla.2010); 9 (Fla.2009). In Chapman, the Fourth District Court of Appeal reviewed a strikingly similar set of facts and rejected the defendant’s argument that the officer had effected an investigatory stop by telling the defendant, “Come here ... [m]ay I talk to you?” 780 So.2d at 1038. The Chapman Court held that when an officer merely asks a suspect to come towards him without any additional show of authority or evidence that the officer was “confrontational, coercive, oppressive or dominating,” the encounter is typically considered consensual. Id. Similar to the facts of Chapman, in the instant case only one officer was present. There was no evidence that the officer activated any emergency equipment on his police vehicle (no lights or sirens were used), drew or displayed his weapon, touched or restrained E.V., or did anything to block E.V.’s exit or hamper E.V.’s movement. The encounter took place outside in a public place. At no time did the officer make a showing of authority or demonstrate aggressive or coercive behavior towards E.V. In fact, E.V. himself testified that, when he came out of the gas station, the officer pulled up and “he asked me come over here.... I proceeded to come to him.” (emphasis added). At no point did the officer demand compliance— he simply asked E.V. if he would speak with him. E.V. was free to walk away and go about his business or to decline to speak with the officer, which is the very hallmark of a consensual encounter. Thus, the encounter was consensual, and E.V.’s motion to suppress the evidence was properly denied. Affirmed. | 08-21-2021 | [
"ROTHENBERG, J. E.V., a juvenile, appeals the trial court’s order denying his motion to suppress evidence and the subsequent order withholding adjudication of delinquency for possession of cannabis. E.V. contends that the police encounter leading to the discovery of the evidence against him was not consensual and was not supported by reasonable suspicion. Because the record supports the trial court’s finding that the encounter was consensual, we affirm. Although the arresting officer’s and E.V.’s recitation of the facts differed, the trial court, based on its credibility determinations, found the officer’s testimony credible. The officer testified that after observing E.V. standing outside of a gas station for approximately thirty minutes, he decided to investigate. He therefore exited his patrol car and asked E.V. to come towards him. As he and E.V. walked towards each other, the officer got closer to E.V.",
"and smelled burnt marijuana emanating from E.V.’s clothing. When he asked E.V. about the marijuana smell, E.V. immediately handed the officer a small baggie of marijuana and told the officer where E.V. had acquired it. The trial court concluded that the encounter was consensual and therefore denied E.V.’s motion to suppress the evidence. A trial court’s ruling on a motion to suppress evidence presents a mixed question of fact and law whereby the reviewing court bestows a presumption of correctness to the trial court’s findings of fact, but reviews the application of law to those facts de novo. Connor v. State, 803 So.2d 598, 608 (Fla.2001). The presumption of correctness cloaking the trial court’s findings of fact is rebutted only if there is no competent substantial record evidence supporting that factual determination.",
"Id. “A consensual encounter is one in which a reasonable person would feel free to disre*1165gard the police and go about his business. A consensual encounter does not require the police to have a reasonable suspicion of any improper conduct before initiating conversation.” Chapman v. State, 780 So.2d 1036, 1037 (Fla. 4th DCA 2001) (internal citation omitted) (citing Voorhees v. State, 699 So.2d 602, 608 (Fla.1997)). When determining whether an encounter with the police is consensual, the court must base its determination on the totality of the circumstances. Caldwell v. State, 41 So.3d 188, 197-99 (Fla.2010); 9 (Fla.2009). In Chapman, the Fourth District Court of Appeal reviewed a strikingly similar set of facts and rejected the defendant’s argument that the officer had effected an investigatory stop by telling the defendant, “Come here ... [m]ay I talk to you?” 780 So.2d at 1038.",
"The Chapman Court held that when an officer merely asks a suspect to come towards him without any additional show of authority or evidence that the officer was “confrontational, coercive, oppressive or dominating,” the encounter is typically considered consensual. Id. Similar to the facts of Chapman, in the instant case only one officer was present. There was no evidence that the officer activated any emergency equipment on his police vehicle (no lights or sirens were used), drew or displayed his weapon, touched or restrained E.V., or did anything to block E.V.’s exit or hamper E.V.’s movement. The encounter took place outside in a public place. At no time did the officer make a showing of authority or demonstrate aggressive or coercive behavior towards E.V. In fact, E.V. himself testified that, when he came out of the gas station, the officer pulled up and “he asked me come over here.... I proceeded to come to him.” (emphasis added). At no point did the officer demand compliance— he simply asked E.V.",
"if he would speak with him. E.V. was free to walk away and go about his business or to decline to speak with the officer, which is the very hallmark of a consensual encounter. Thus, the encounter was consensual, and E.V.’s motion to suppress the evidence was properly denied. Affirmed."
] | https://www.courtlistener.com/api/rest/v3/opinions/4811100/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
Case 5:21-cv-00144-SVK Document 11 Filed 03/31/21 Page 1 of 1
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4 UNITED STATES DISTRICT COURT
5 NORTHERN DISTRICT OF CALIFORNIA
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7 SCOTT JOHNSON, Case No. 21-cv-00144-SVK 8 Plaintiff, ORDER TO SHOW CAUSE RE 9 v. SETTLEMENT 10 CUPERTINO HOSPITALITY Re: Dkt. No. 10 ASSOCIATES, LLC, 11 Defendant. 12 Northern District of California United States District Court
Plaintiff reports that this case has settled. Dkt. 10. All previously-scheduled deadlines and 13 appearances are vacated. 14 By May 18, 2021, the parties shall file a stipulation of dismissal. If a dismissal is not filed by 15 the specified date, then the parties shall appear on May 25, 2021 at 1:30 p.m. and show cause, if any, 16 why the case should not be dismissed. Additionally, the parties shall file a statement in response to 17 this Order no later than May 18, 2021, describing with specificity (1) the parties’ efforts to finalize 18 settlement within the time provided, and (2) whether additional time is necessary, the reasons therefor, 19 and the minimum amount of time required to finalize the settlement and file the dismissal. 20 If a dismissal is filed as ordered, the Order to Show Cause hearing will be automatically 21 vacated and the parties need not file a statement in response to this Order. 22 SO ORDERED. 23 Dated: March 31, 2021 24
25
26 SUSAN VAN KEULEN United States Magistrate Judge 27
28 | 2021-03-31 | [
"Case 5:21-cv-00144-SVK Document 11 Filed 03/31/21 Page 1 of 1 1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 SCOTT JOHNSON, Case No. 21-cv-00144-SVK 8 Plaintiff, ORDER TO SHOW CAUSE RE 9 v. SETTLEMENT 10 CUPERTINO HOSPITALITY Re: Dkt. No. 10 ASSOCIATES, LLC, 11 Defendant. 12 Northern District of California United States District Court Plaintiff reports that this case has settled. Dkt. 10. All previously-scheduled deadlines and 13 appearances are vacated. 14 By May 18, 2021, the parties shall file a stipulation of dismissal. If a dismissal is not filed by 15 the specified date, then the parties shall appear on May 25, 2021 at 1:30 p.m. and show cause, if any, 16 why the case should not be dismissed. Additionally, the parties shall file a statement in response to 17 this Order no later than May 18, 2021, describing with specificity (1) the parties’ efforts to finalize 18 settlement within the time provided, and (2) whether additional time is necessary, the reasons therefor, 19 and the minimum amount of time required to finalize the settlement and file the dismissal.",
"20 If a dismissal is filed as ordered, the Order to Show Cause hearing will be automatically 21 vacated and the parties need not file a statement in response to this Order. 22 SO ORDERED. 23 Dated: March 31, 2021 24 25 26 SUSAN VAN KEULEN United States Magistrate Judge 27 28"
] | https://www.courtlistener.com/api/rest/v3/recap-documents/172750183/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
184 U.S. 497 (1902) TULLOCK v. MULVANE. No. 59. Supreme Court of United States. Argued October 25, 28, 1901. Decided March 3, 1902. ERROR TO THE SUPREME COURT OF THE STATE OF KANSAS. *502 Mr. W.H. Rossington for plaintiff in error. Mr. Charles Blood Smith and Mr. Clifford Histed were on his brief. Mr. N.H. Loomis for defendant in error. Mr. A.L. Williams was on his brief. MR. JUSTICE WHITE, after making the foregoing statement, delivered the opinion of the court. *503 The assignments of error, though fourteen in number, are reducible to three propositions. 1. A contention that as the bond provided for a liability only in case it was finally decided that the injunction was wrongfully granted, no recovery could be had upon the bond, because the stipulation between the complainants and certain of the defendants had the effect of rendering it impossible to have a final determination in the courts of the United States whether the injunction ought originally to have been granted. 2. A claim on the part of the defendant that as the bond for injunction was executed under the order of a court of equity of the United States, and therefore by an authority exercised under the United States, and as liability was only to arise when it had been finally decided that the injunction ought not to have been granted, action on the bond could not be brought pending an appeal to the Circuit Court of Appeals of the United States, and the final determination by that court of the controversy. 3. An assertion that as, by the settled rule of the courts of equity of the United States, attorneys' fees were not an element of damage covered by the terms of an injunction bond given in such court, recovery of such fees on such bond was not within the purview of the bond when construed with reference to and by the light of the authority under which the bond was given. It is urged by the defendant in error that these contentions involve no Federal question and that if they do they were not sufficiently set up in the lower courts, and therefore this court has no jurisdiction to review them. We dispose at once of the contention that if the propositions involve Federal questions they were not duly raised below, by referring to the statement which we have made of the case, whereby it appears that the contentions were raised below by the pleadings, by the objections to evidence and by the requests for instructions, and indeed as so raised were expressly considered and directly passed upon by both the trial court and the Supreme Court of the State of Kansas, which latter fact in and of itself suffices to present the Federal question, even if it had been otherwise *504 ambiguously raised on the record, which is not the case. Oxley Stave Co. v. Butler County, 166 U.S. 648. In determining whether these Federal questions are involved, we shall for the moment take it for granted that the premises upon which such asserted questions rest are well founded, and if under such hypothesis we find that there is jurisdiction it will then be our duty to put such assumption out of view and determine the merits of the contentions. Whilst apparently the propositions involve several distinct assertions of Federal right, in their ultimate analysis they reduce themselves to one and the same contention; that is, that a bond given for an injunction in an equity cause in a court of the United States is to be construed with reference to the liability administered in the courts of the United States on that subject as settled by this court. That this fundamental proposition embraces all the contentions would seem to be clear, when it is borne in mind that the controversy as to the stipulation and as to the pendency of the cause in the Circuit Court of Appeals assert both the generic right of the defendant to have the obligations under the bond measured and determined by the law prevailing in the courts of the United States and the claim as to the attorneys' fees propounds but the same right as to one of the elements of damage which it was asserted the bond embraced. Whilst the unity of the propositions is thus demonstrable, as in the court below and in argument they have been separately treated and different considerations have been assumed to apply to them, we shall consider the propositions separately. We embrace the first two contentions under one heading, as follows: First. Did the claim that there had been no breach of the condition of the bond because of the stipulation filed in the cause in which the bond was given and because of the pendency of the appeal in the Circuit Court of Appeals present Federal questions, and, if yes, were they well founded? It may not, we think, be doubted that a bond for injunction in an equity court of the United States given under the order of such court is a bond executed in and by virtue "of an authority *505 exercised under the United States." Rev. Stat. sec. 709. Certainly, the courts of the United States derive all their powers from the Constitution and laws of the United States, and their authority is therefore exercised thereunder. Being then an obligation entered into by virtue of such authority, the conclusion cannot be escaped that the defence specially set up that no liability on the bond could arise until the court of the United States in which the controversy was pending had finally determined that the injunction should not have been granted, was the assertion of an immunity from liability depending on an authority exercised under the United States, and therefore necessarily involved the decision of a Federal question. To state the result which must necessarily flow from a contrary deduction is sufficient of itself to demonstrate the unsoundness of the reasoning by which the non-Federal nature of the question can alone be upheld. For it is clear that if it be true that the bond given in a Federal court of equity on the granting of an injunction is not to be construed with reference to the rules of law applicable to such bonds in such court, then there can be no certain general rule by which to determine the liability of the obligors upon the bond. Their responsibility would be one thing in a court of the United States and a different thing in the courts of the various States, which would imply that the parties did not contract with reference to any definite rule of liability. Indeed, the argument conduces to a conclusion which necessarily cripples the power of the court under whose order an injunction bond is executed. It is settled that such court has the inherent right to set the bond aside and to determine in its discretion whether recovery could be had upon it. Russell v. Farley, 105 U.S. 433. And yet if the liability upon the bond when given can be measured in courts other than the court requiring the execution of the bond, by a wholly different rule of liability from that which obtained in the court which had ordered the giving of the bond, it must follow that although the latter court had decreed that the injunction had rightfully issued, yet in an action upon the injunction bond in another forum the sureties might be made to respond in damages without hope of redress. A reference to some of the decided cases concerning what *506 constitutes a claim of immunity arising from an authority exercised under the United States, will serve at once to refute the contention that no Federal question is here presented. In Dupasseur v. Rochereau, 21 Wall. 130, the question for decision was whether a state court had given due effect to a decree of a court of the United States, and it was asserted that the contention that it had not presented no Federal question. Speaking through Mr. Justice Bradley, the court said (p. 134): "Where a state court refuses to give effect to the judgment of a court of the United States rendered upon the point in dispute, and with jurisdiction of the case and the parties, a question is undoubtedly raised which, under the act of 1867, may be brought to this court for revision. The case would be one in which a title or right is claimed under an authority exercised under the United States, and the decision is against the title or right so set up. It would thus be a case arising under the laws of the United States, establishing the Circuit Court and vesting it with jurisdiction; and hence it would be within the judicial power of the United States, as defined by the Constitution; and it is clearly within the chart of appellate power given to this court, over cases arising in and decided by the state courts." In Factors' & Traders' Insurance Company v. Murphy, 111 U.S. 738, a court of the United States sitting in bankruptcy had ordered a sale of real property of the bankrupt free from encumbrances. The property was purchased at the sale on behalf of lienholders. Subsequently one who possessed a lien on the property at the time the order was entered and sale made, brought suit in a state court of Louisiana to foreclose such lien, claiming that she had not been a party to the bankruptcy proceedings, and that her lien was unaffected by the sale. The defendant, in whose name title had been taken, while averring that the plaintiff was interested in the purchase at the sale made under the order of the United States court, insisted that the lien of the mortgage of plaintiff had been extinguished by such sale. The state court having decreed in favor of plaintiff, a writ of error was prosecuted from this court. In reversing the judgment of the state court, it was said (p. 741): *507 "Counsel for defendant in error deny the jurisdiction of this court and move to dismiss the writ. But it is apparent that the only controversy in the case relates to the effect to be given to the sale under the order of the District Court of the United States, to sell the mortgaged property free from incumbrance. Both parties assert rights under this order and sale. Plaintiffs in error assert that the sale as made was valid, and, being sold free from incumbrances, extinguished Mrs. Murphy's lien as well as others. Defendant asserts that it had the effect of discharging all other liens but hers, and thus gave her the exclusive, paramount lien on all the property so sold. Both the parties, therefore, rely upon rights under Federal authority, and as the right of plaintiff in error was denied by the court the writ of error lies." In Avery v. Popper, 179 U.S. 305, the two cases last above referred to were approvingly cited, and the rule was declared to be that where a controversy in the state court presented a contention as to the validity or proper construction of an order or decree rendered by a court of the United States, a Federal question was presented reviewable by this court (p. 314). In Crescent Live Stock Company v. Butchers' Union, 120 U.S. 141, the facts were briefly these: Under a bill filed in a Circuit Court of the United States, a temporary injunction had been allowed after hearing, and a bond had been given under an order of the court, the injunction was perpetuated by the Circuit Court on the final hearing. The case was appealed to this court, and the decree of the Circuit Court was reversed. Suit was brought in a court of the State of Louisiana upon the injunction bond given in the Federal court, against the principal and surety in solido and against the principal alone, to recover damages for the malicious prosecution of the injunction suit in the Federal court. It was claimed by the defendants that the final decree of the Circuit Court of the United States, although subsequently reversed by this court, constituted probable cause, and therefore there could be no recovery on the alleged cause of action for malicious prosecution. Both the state trial court by way of instructions to the jury and the Supreme Court of Louisiana decided that the decree of the Circuit Court of the *508 United States did not constitute probable cause, because prior to the decision of the Circuit Court of the United States a contrary view to that which the Circuit Court adopted had been announced by the highest court of the State of Louisiana. The jurisdiction of this court to review the controversy was challenged upon the very grounds now relied upon, and the court said (p. 146): "It is argued by counsel for the defendant in error that this does not embrace any Federal question; that the effect to be given to a judgment or decree of the Circuit Court of the United States sitting in Louisiana by the courts of that State is to be determined by the law of Louisiana, or by some principle of general law as to which the decision of the state court is final; and that the ruling in question did not deprive the plaintiffs in error of `any privilege or immunity specially set up or claimed under the Constitution or laws of the United States.' But this is an error. The question whether a state court has given due effect to the judgment of a court of the United States is a question arising under the Constitution and laws of the United States." In Meyers v. Block, 120 U.S. 206, the case came to this court on error to a state court, and involved the correctness of the construction by that court of the terms of an injunction bond given in a court of the United States. This court treated the matter of jurisdiction as one of course, held that the parties signing the bond must be presumed to have been cognizant of the order under which the bond was given, and to have contracted in reference thereto, and that the bond should be read in the light of the order, and the court applied to the interpretation of the bond its own views of the applicable principles of law. The cases of New York Life Insurance Co. v. Hendren, 92 U.S. 286; Provident Savings Society v. Ford, 114 U.S. 635; Blackburn v. Portland Gold Mining Co., 175 U.S. 571, and others of like character, do not conflict with the rule which we apply in this cause, and which was expounded in the cases to which we have previously referred. This results when it is observed that none of the cases just above referred to involved *509 the construction or effect of a law of the United States or a judgment, decree or order or other act done under and by virtue of the authority of a court of the United States or a claim of immunity thereunder. The contention as to the prematurity of the suit presenting then a Federal controversy, the question is, was the claim of prematurity well founded? Previous to the bringing of the suit in the state court upon the bond, by stipulation filed in the equity cause in the United States court, upon which an order of the court was entered, the bill of complaint had been dismissed as to all the defendants but Mulvane, and it was expressly agreed that all demand for relief by way of specific performance should be withdrawn. We think that the Circuit Court of Appeals correctly decided that the necessary effect of this agreement was to withdraw from the case all controversy on the subject of the injunction. As by the stipulation Mulvane had not waived any rights of action by reason of damages caused by the injunction if any, but on the contrary his rights were expressly saved, and as the stipulation was made the basis of an order of the court which had the necessary effect to dismiss from the cause all the grounds upon which alone the rightfulness of the injunction could have been asserted, we think there was a final decision, within the import of the condition of the bond, that the injunction ought not to have been granted. As respects the argument that by reason of the execution of the stipulation, the sureties upon the injunction bond were absolutely discharged, because thereby a final determination of the rightfulness of the allowance of the injunction was prevented, we think it obvious that the sureties when executing the bond did so, subject to the right of the complainants in good faith to dismiss their bill, or to make a stipulation such as that we have referred to, which was in effect the equivalent of the dismissal of the bill in so far as all equitable relief was concerned. We are thus brought to consider the second contention, which is, Second. Did the claim of immunity from liability for attorneys' fees, as one of the elements of damage under the injunction bond, present a Federal question; and if yes, was it correctly *510 decided by the court below that it was proper to award the amount of such fees in enforcing the bond? The first branch of this question has already been disposed of by the reasons given and authorities cited in the consideration of the proposition previously passed upon. It is insisted, however, that such is not the case, because whilst it is true the courts of the United States exercise their authority under the Constitution and laws of the United States, that, as there is no express statutory authority regulating injunction bonds, therefore in determining the measure of liability on them no claim of immunity arising from an authority exercised under the United States can arise. But this is a mere form of restating the contention we have already disposed of. The test is not the particular source, on form by which the authority of the United States has been conferred or is exerted, but whether such authority existed and was exercised and an immunity is claimed under it. Besides, by express provision of the Revised Statutes (sec. 617) proceedings of the courts of the United States in equity causes are subject to regulation by this court, with power to modify and change such rules. And rule No. 90, promulgated under the authority thus conferred, provides as follows: "In all cases where the rules prescribed by this court or by the Circuit Court do not apply, the practice of the circuit court shall be regulated by the present practice of the High Court of Chancery in England, so far as the same may be reasonably applied consistently with the local circumstances and local conveniences of the district where the court is held, not as positive rules, but as furnishing just analogies to regulate the practice." And it is by the force and effect of this rule that the equity courts of the United States exercise their power with respect to the exaction of security when granting writs of injunction. Russell v. Farley, 105 U.S. 433. It follows that proceedings in courts of equity of the United States are regulated by rules promulgated by this court deriving their force from statutory authority, and the argument which we have just considered, even if it were not erroneous, *511 would be inapposite. The jurisdiction to review being then established, it remains only to consider whether the attorneys' fees were properly allowed by the court below as an element of damages on the bond. That they were not, is settled. In Oelrichs v. Spain, 15 Wall. 211, this court, speaking through Mr. Justice Swayne, said (p. 230): "The decree of the court below was preceded by the report of a master, which the decree affirmed and followed. Upon looking into the report we find it clear and able, and we are entirely satisfied with it, except in one particular. We think that both the master and the court erred in allowing counsel fees, as a part of the damages covered by the bonds. "In Arcambel v. Wiseman, 3 Dall. 306, decided by this court in 1796, it appeared `by an estimate of the damages upon which the decree was founded, and which was annexed to the record, that a charge of $1600 for counsel fees in the courts below had been allowed.' This court held that it `ought not to have been allowed.' The report is very brief. The nature of the case does not appear. It is the settled rule that counsel fees cannot be included in the damages to be recovered for the infringement of a patent. Tesse v. Huntingdon, 23 How. 2 (64 U.S. XVI. 479); Whittemore v. Cutter, 1 Gall. 429; Stimson v. The Railroads, 1 Wall. Jr. 164. They cannot be allowed to the gaining side in admiralty as incident to the judgment beyond the costs and fees allowed by the statute. The Baltimore, 8 Wall. 378 (75 U.S. XIX. 463). "In actions of trespass where there are no circumstances of aggravation, only compensatory damages can be recovered, and they do not include the fees of counsel. The plaintiff is no more entitled to them, if he succeed, than is the defendant if the plaintiff be defeated. Why should a distinction be made between them? In certain actions ex delicto vindictive damages may be given by the jury. In regard to that class of cases this court has said: `It is true that damages assessed by way of example may indirectly compensate the plaintiff for money expended in counsel fees, but the amount of these fees cannot be taken as the measure of punishment or a necessary element in its infliction.' Day v. Woodworth, 13 How. 370, 371. *512 "The point here in question has never been expressly decided by this court, but it is clearly within the reasoning of the case last referred to, and we think is substantially determined by that adjudication. In debt, covenant and assumpsit damages are recovered, but counsel fees are never included. So in equity cases, where there is no injunction bond, only the taxable costs are allowed to the complainants. The same rule is applied to the defendant, however unjust the litigation on the other side, and however large the expensa litis to which he may have been subjected. The parties in this respect are upon a footing of equality. There is no fixed standard by which the honorarium can be measured. Some counsel demand much more than others. Some clients are willing to pay more than others. More counsel may be employed then are necessary. When both client and counsel know that the fees are to be paid by the other party there is danger of abuse. A reference to a master, or an issue to a jury, might be necessary to ascertain the proper amount, and this grafted litigation might possibly be more animated and protracted than that in the original cause. It would be an office of some delicacy on the part of the court to scale down the charges, as might sometimes be necessary. "We think the principle of disallowance rests on a solid foundation, and that the opposite rule is forbidden by the analogies of the law and sound public policy." It is strenuously urged, however, and this was in effect the view taken by the court below, that although the rule against allowing attorneys' fees in actions on injunction bonds was thus settled by this court adverse to the right to recover such fees, as the local law was to the contrary, the injunction bond given in the Federal court must be enforced, not by the law of the forum in which it was given, but according to the rule of the local law. This proposition, again, however, but embodies the contention that the question of the allowance of attorneys' fees involved no Federal question, which has already been disposed of. For if it be true, and it undoubtedly is, that the giving of such a bond was an act done pursuant to an authority exercised under the Constitution and laws of the United States, it must follow that the bond so taken is to be interpreted with *513 reference to the authority under which it was given and the principles of jurisprudence controlling such authority, and not by the local law. To hold the contrary, as we have previously pointed out, would be but to declare that although the power conferred by Congress upon this court to adopt equity rules is controlling, nevertheless the interpretations of the rules and the limitations which arise from a proper construction of them, as expounded by this court and enunciated in its decisions, are without avail. And this yet further points out the fallacy involved in the contention that the lower court, in passing upon the issues, decided merely a question of general law involving no Federal controversy. Now it is at once conceded that the decision by a state court of a question of local or of general law involving no Federal element does not as a matter of course present a Federal question. But where on the contrary a Federal element is specially averred and essentially involved, the duty of this court to apply to such Federal question its own conceptions of the general law we think is incontrovertible. Avery v. Popper, 179 U.S. 305, 315. Whilst in the absence of authority the foregoing considerations suffice to dispose of the case, it is also effectually concluded by authority. Bein v. Heath, 12 How. 168. In that case, as in this, it was insisted that the local law should have been applied in construing and enforcing an injunction bond given in a court of the United States. But the court, in negativing the contention, speaking through Mr. Chief Justice Taney, said (p. 178): "Now, there is manifest error in subjecting the parties to an injunction bond, given in a proceeding in equity in a court of the United States, to the laws of the State. The proceeding in a Circuit Court of the United States in equity is regulated by the laws of Congress, and the rules of this court made under the authority of an act of Congress. And the ninetieth rule declares that, when not otherwise directed, the practice of the High Court of Chancery in England shall be followed. The eighth rule authorizes the Circuit Court, both judges concurring, to modify the process and practice in their respective districts. But this applies only to forms of proceeding and *514 mode of practice, and certainly would not authorize the adoption of the Louisiana law, defining the rights and obligations of parties to an injunction bond. Nor do we suppose any such rule has been adopted by the court. And if it has, it is unauthorized by law, and cannot regulate the rights or obligations of the parties. "And when an injunction is applied for in the Circuit Court of the United States sitting in Louisiana, the court may grant it or not, according to the established principles of equity, and not according to the laws and practice of the State in which there is no court of chancery, as contra-distinguished from a court of common law. And they require a bond, or not, from the complainant, with sureties, before the injunction issues, as the court, in the exercise of a sound discretion, may deem it proper for the purposes of justice. And if, in the judgment of the court, the principles of equity require that a bond should be given, it prescribes the penalty and the condition also. And the condition prescribed by the court in this case, but which was not followed, is the one usually directed by the court. "In proceeding upon such a bond, the court would have no authority to apply to it the legislative provisions of the State." Indeed, the principles announced in Bein v. Heath were in effect but the reiteration of the doctrine previously established by this court, that a bond given in pursuance of a law of the United States was governed, as to its construction, not by the local law of a particular State, but by the principles of law as determined by this court, and operative throughout the courts of the United States. Cox v. United States, 6 Pet. 172; Duncan's Heirs v. United States, 7 Pet. 435. It follows from what we have stated that there was error committed in allowing the recovery of attorneys' fees as an element of damage upon the bond in question. The judgment of the Supreme Court of Kansas must be reversed, and the case remanded to that court for further proceedings not inconsistent with this opinion, and it is so ordered. *515 MR. JUSTICE HARLAN, with whom concurred THE CHIEF JUSTICE and MR. JUSTICE BROWN, dissenting. This was an action in one of the courts of the State of Kansas upon an injunction bond executed in a suit in equity in the Circuit Court of the United States for the District of Kansas the condition of the bond being that the obligors would pay or cause to be paid to the obligees and to each of them, "all damages which they, or either of them, have already sustained, or may at any time sustain, by reason of the granting and issuing of said restraining order, or the granting and issuing of said temporary injunction, if it shall be finally decided that said restraining order or said temporary injunction ought not to have been granted." There was a verdict and judgment against Tullock, one of the sureties in the bond. Mulvane, the plaintiff, being dissatisfied with the amount of the verdict and the rulings of the trial court, prosecuted a writ of error to the Supreme Court of Kansas, where the judgment was reversed and the cause remanded for another trial. Mulvane v. Tullock, 58 Kansas, 622. That court said (p. 632): "That counsel fees are recoverable as damages upon an injunction bond has been the uniform holding of this court from the beginning, and this appears to be the view taken by most of the courts of the country. Underhill v. Spencer, 25 Kansas, 71; Loofborow v. Shaffer, 28 Kansas, 71; Loofborow v. Shaffer, 29 Kansas, 415; Nimocks v. Welles, 42 Kansas, 39; 10 Am. & Eng. Ency. of Law, 999, and cases cited. It appears, however, that there are some decisions of the Federal courts to the contrary, holding that the obligation of an injunction bond imposes no duty upon the obligor to pay the attorney's fees if the injunction is wrongfully obtained. Arcambel v. Wiseman, 3 Dallas, 306; Oelrichs v. Spain, 15 Wall. 211. It is contended that, as the bond was given in a case in one of the Federal courts, the obligation must be interpreted in accordance with the decisions of those courts. The claim is that the rules and decisions of the Supreme Court of the United States have the force of legislative declarations; that they enter into, and become a part of, the *516 contract of the sureties, who can only be held liable for such consequences as are the direct result of the breach and were within their contemplation at the time the bond was executed. No statute, however, prescribed the conditions of the bond nor limited the extent of liability thereon. It is true that it was within the general equitable power of the Federal court to prescribe the conditions upon which the injunction should issue. It could have granted an injunction without requiring a bond, or it might, in its discretion, have imposed such terms as it saw fit as a condition of granting the injunction. It did require the giving of a bond, and the bond was executed in accordance with the order of the court. The bond executed is in the ordinary form; is in the nature of a contract; and the liability of the obligors depends, not on the Federal Constitution or a Congressional act, but on the proper interpretation of the bond itself. In the absence of a statute fixing the measure of damages or limiting the recovery, we think the bond should be viewed in the light of an independent contract, and is to be interpreted by the general principles of the common law. It is not a mere incident of the injunction proceeding, nor can this, which is an ordinary action at law, be regarded as auxiliary to the proceeding in the Federal court. Being an independent contract, actionable in any state court where service upon the sureties can be obtained, the interpretation of the forum applies. As the action on the bond could be brought in the state court and, indeed, the present action could not have been brought in any other it cannot be said that the sureties contracted with reference to the view of the law taken by the Federal courts. They knew that the obligation was enforceable in the courts of the State of which the plaintiff and defendants were all residents, and that the highest court of that State had consistently held that counsel fees were recoverable upon an injunction bond. That the bond was given in a Federal court, where a different rule of interpretation obtains, has not been deemed to affect the state court in determining the liability upon such bond when suit was brought thereon. Mitchell v. Hawley, 79 California, 301; Hannibal & St. Joseph Railroad v. Shepley, 1 Mo. App. *517 254; Wash. v. Lackland, 8 Mo. App. 122; Aiken v. Leathers, 40 La. Ann. 23; Corcoran v. Judson, 24 N.Y. 106." In addition to Corcoran v. Judson, 24 N.Y. 106, cited by the state court, see Coates v. Coates, 1 Duer, 664; Edwards v. Bodine, 11 Paige, 223, and Sedgwick on Damages, 177; also, Barton v. Fisk, 30 N.Y. 166, 171; Behrens v. McKenzie, 23 Iowa, 333, 342; Ford v. Loomis, 62 Iowa, 566, 588; Cook v. Chapman, 41 N.J. Eq. 152, 154; Noble v. Arnold, 23 Ohio St. 264, 270; Morris v. Price, 2 Blackf. 457; Derry Bank v. Heath, 45 N.H. 524; Ryan v. Anderson, 25 Ill. 372; Garrett v. Logan, 19 Alabama, 344. At the second trial Mulvane obtained a verdict and judgment which embraced his counsel fees in the injunction suit, and that judgment having been affirmed by the Supreme Court of Kansas, (61 Kansas, 650,) it is sought to have it reviewed by this court, under section 709 of the Revised Statutes, upon the ground that by the action of the Supreme Court of Kansas the plaintiff in error, Tullock, was denied an "immunity" belonging to him under an "authority exercised under the United States." The immunity so claimed is that he, Tullock, was erroneously held to be liable for the attorneys' fees which the obligee in such bond paid or became bound to pay in or about obtaining or dissolving the injunction in the suit in the Federal court. Can this court review the action of the state court upon any such a question? Is it true that the alleged "immunity" arises from an "authority exercised under the United States?" In Avery v. Popper, 179 U.S. 305, 314, 315, this court, speaking by Mr. Justice Brown, said: "With respect to writs of error from this court to judgments of state courts in actions between purchasers under judicial proceedings in the Federal courts and parties making adverse claims to the property sold, the true rule to be deduced from these authorities is this: That the writ will lie, if the validity or construction of the judgment of the Federal court, or the regularity of the proceedings under the execution, are assailed; but if it be admitted that the judgment was valid, and those proceedings were regular, that the purchaser took the title of the defendant in the execution, and the issue relates to the title to the property, as between the defendant *518 in the execution or the purchaser under it, and the party making the adverse claim, no Federal question is presented in other words, it must appear that the decision was made against a right claimed under Federal authority, in the language of Rev. Stat. § 709." Again: "This was a question either of local law or of general law. If of local law, of course the decision of the Supreme Court of Texas is binding upon us. If of general law, as it involves no Federal element, it is equally binding in this proceeding, since only Federal rights are capable of being raised upon writs of error to state courts. Conceding that, if the question had arisen on appeal from a Circuit Court of the United States, we might have come to a different conclusion, it by no means follows that we can do so upon a writ of error to a state court, whose opinion upon a question of general law is not reviewable here." Surely this case does not involve a Federal immunity simply because the bond in suit was taken under the authority of the Circuit Court of the United States. If it does, then this court erred in its decision in Provident Savings Society v. Ford, 114 U.S. 635, (reaffirmed in many subsequent cases,) in which it was contended that a suit upon a judgment rendered by a Federal court necessarily involved questions arising under the laws of the United States. That contention was overruled. This court, speaking by Mr. Justice Bradley, said: "What is a judgment, but a security of record showing a debt due from one person to another? It is as much a mere security as a treasury note, or a bond of the United States. If A brings an action against B, trover or otherwise, for the withholding of such securities, it is not therefore a case arising under the laws of the United States, although the whole value of the securities depends upon the fact of their being the obligations of the United States. So if A have title to land by patent of the United States and brings an action against B for trespass or waste, committed by cutting timber, or by mining and carrying away precious ores, or the like, it is not therefore a case arising under the laws of the United States. It is simply the case of an ordinary right of property sought to be enforced. A suit on a judgment is nothing more, unless some question is raised in the case (as might *519 be raised in any of the cases specified), distinctly involving the laws of the United States such a question, for example, as was ineffectually attempted to be raised by the defendant in this case. If such a question were raised, then it is conceded it would be a case arising under the laws of the United States." In Blackburn v. Portland Gold Mining Co., 175 U.S. 571, it was held that the judgment of the Supreme Court of a State could not be reviewed simply because the case involved a contest between rival claimants of a mine under certain sections of the Revised Statutes. To the same effect are Florida Central & Peninsular Railroad Co. v. Bell, 176 U.S. 321; De Lamar's Mining Co. v. Nesbitt, 177 U.S. 523; Shoshone Mining Co. v. Rutter, 177 U.S. 505. There is no question in this case as to the validity of any authority exercised under the United States. The only question is as to the rights of one party and the liabilities of the other party under an ordinary injunction bond. What those rights and liabilities are cannot be determined by reference to the Constitution or any statute of the United States. Nor has any rule been adopted by the Circuit Court of the United States limiting the legal effect of the words of the bond or declaring what damages should be covered by it. Of course, if Congress had enacted a statute prescribing the form of injunction bonds, and directing what liabilities should arise thereon against the obligors, that statute would control. But no such statute has been passed, and the question is left to be determined by the principles of general law. Reference has been made to Oelrichs v. Spain, 15 Wall. 211, in support of the proposition that the question presents an "immunity" which exists under Federal authority. That case was brought in a Circuit Court of the United States. It does decide that attorneys' fee should not be allowed in a suit on injunction bonds. But there is in the opinion no hint even that the decision as to what damages can be allowed in such a suit rests upon a Federal ground. On the contrary, the court, after citing some authorities, says that "the principle of disallowance rests on a solid foundation, and that the opposite view is forbidden by the analogies of the law and sound policy." *520 We have been referred also to Equity Rule 90 of this court, which declares that "the practice of the Circuit Court shall be regulated by the present practice of the High Court of Chancery in England, so far as the same may be reasonably applied consistently with the local circumstances and local convenience of the district where the court is held, not as positive rules, but as furnishing just analogies to regulate the practice." I cannot perceive that this rule has any pertinency, as it relates merely to practice, and not to the principles of law by which the rights and obligations of parties to injunction bonds are determinable. Bein v. Heath, 12 How. 168, 178, has been cited as showing that in allowing attorneys' fees the state court invaded a Federal right. That was a suit in the Circuit Court of the United States on an injunction bond taken in the same court. The trial court determined the case according to a statute of Louisiana defining the rights and obligations of the parties. This court held that "in proceeding upon such a bond, the court would have no authority to apply to it the legislative provisions of the State. The obligors would be answerable for any damage or cost which the adverse party sustained, by reason of the injunction, from the time it was issued until it was dissolved, but to nothing more. They would certainly not be liable for any aggravated interest on the debt, nor for the debt itself, unless it was lost by the delay, nor for the fees paid to the counsel for conducting the suit." Absolutely nothing is to be found in the opinion of the court sustaining the proposition that the rights and obligations of the parties to an injunction bond are determinable upon any principle of a Federal nature. The court referred to the 90th and 8th Equity rules, as furnishing authority for the taking of injunction bonds, but took care to say that those rules relate only to "forms of proceeding and mode of practice," and not to "the rights and obligations of parties to injunction bonds." And what was said in that case touching the rights and obligations of parties to injunction bonds was an expression of the views of the state court as to the general principles of law applicable in such cases. This is apparent from the extract given in the opinion of the court *521 from the opinion in Bein v. Heath. In Meyers v. Block, cited in the opinion in this case, 120 U.S. 206, 211, the court said that there was no question "as to the power of a court of equity to impose any terms in its discretion as a condition of granting or continuing an injunction." Russell v. Farley, 105 U.S. 433. Consequently the terms being prescribed, their meaning, in the absence of a statute, depends upon general, not Federal law. Cases have been cited which show that this court can re-examine the final judgment of the highest court of a State which fails to give due effect to a judgment, decree or order of a court of the United States. But such cases have no pertinency to the present discussion; for in the present case the state court did not disregard any judgment, decree or order of the Federal court. It did nothing more than enforce its views as to the rights and obligations of parties under a bond theretofore taken in a suit in a Federal court. Meyers v. Block, cited in the opinion, shows that our jurisdiction in that case was maintained solely because the case involved the question whether the injunction bonds there in suit were in conformity with the order of the Federal court in which they were taken. In N.Y. Life Ins. Co. v. Hendren, 92 U.S. 287, which was brought here from the highest court of Virginia, it was said: "The case, therefore, having been presented to the court below for decision upon principles of general law alone, and it nowhere appearing that the Constitution, laws, treaties or executive proclamations of the United States were necessarily involved in the decision, we have no jurisdiction." In United States v. Thompson, 93 U.S. 586, which came here from the highest court of Maryland, and in which suit the United States was a party, seeking payment of a debt it held against an insolvent partnership, the court said: "It is not contended that this decision is repugnant to the Constitution, or any law or treaty of the United States; but the argument is, that, as the check of McFreely & Hopper was not paid, it did not pay their debt. Whether this is so or not does not depend upon any statute of the United States, but upon the principles of general law alone. We have *522 many times held that we have no power to review the decisions of the State courts upon such questions. Bethel v. Demaret, 10 Wall. 537; Delmas v. Ins. Co., 14 Wall. 666; Ins. Co. v. Hendren, 92 U.S. 287; Rockhold v. Rockhold, 92 U.S. 130." In San Francisco v. Scott, 111 U.S. 268, referring to the question as to the effect of an alcalde grant of the pueblo title, and which was decided by the Supreme Court of California, it was said: "This does not depend on any legislation of Congress, or on the terms of the treaty, but on the effect of the conquest upon the powers of local government in the pueblo under the Mexican laws. That is a question of general public law, as to which the decisions of the state court are not reviewable here. This has been many times decided." Let it be observed that the jurisdiction of the state court, as between the parties and as to the subject-matter, is not disputed. The question before it was as to the extent of the liability of the sureties in the injunction bond. The decision of that question did not depend, in any degree, upon the Constitution or statutes of the United States. It depended entirely upon the meaning of the words of the bond, and the principles of law applicable to such an instrument. It was manifestly, therefore, a question of general law as distinguished from Federal law. Upon such a question the state court was entitled to give effect to its own views. The question could not become a question of Federal law by reason alone of the fact that the bond was executed under the authority of the Circuit Court; for, as already said, neither the order under which the bond was taken, the validity of the bond nor the authority of the court was disputed. Nor could it become a Federal question because of any decision by this court in cases theretofore decided between other parties. Suppose this court had not, prior to the trial of this case, expressed any opinion upon that question of general law. Could it then have been contended that the judgment complained of denied any Federal immunity? If not, then the Federal immunity now claimed arises entirely from the failure of the state court to take the same view of a question of general law which this court took in prior cases between other parties. There has been a wide difference of opinion between this court and some of the state *523 courts upon certain questions of general law. But it has never been supposed that any one has such a vested interest in the views of this court upon questions of general law that he may complain of the refusal of a state court to accept those views as denying him an "immunity" existing or belonging to him, in virtue of an "authority exercised under the United States." In Winona & St. Peter Railroad v. Plainview, 143 U.S. 371, 390, which came to this court from the highest court of Minnesota, it was said: "The fact that the Supreme Court of Minnesota, in the present cases, did not acquiesce in the correctness of the decision of the Circuit Court of the United States, did not constitute a Federal question. Neither the Constitution of the United States nor any act of Congress guarantees to a suitor that the same rule of law shall be applied to him by a state court which would be applied if his citizenship were such that his suit might be brought in a Federal court." Or, suppose two actions were brought in the Federal court (there being diversity of citizenship in each case) one on an injunction bond executed in a Circuit Court of the United States, and the other upon a like bond executed in a state court. What would be the ruling as to the measure of damages? Would the court disallow counsel fees in the first case and allow them in the second case where the highest court of the State had established the principle that counsel fees could be recovered? Each branch of the latter question must, upon the principles of the opinion just delivered, be answered in the affirmative. But they cannot be so answered without placing the decisions of the courts upon a question of general law, on the same basis as a legislative enactment prescribing the measure of damages in suits on injunction bonds. Being unable to assent to the principle that a Federal immunity arises when a state court, in determining a question not involving the Constitution or laws of the United States nor the validity of an authority exercised under the United States, reaches a conclusion upon a question of general law different from that announced in prior cases by this court and denying our authority to compel a state court to disregard its own views *524 upon a question of general law, I am constrained to dissent from the opinion and judgment. MR. CHIEF JUSTICE FULLER and MR. JUSTICE BROWN concur in this opinion. | 04-28-2010 | [
"184 U.S. 497 (1902) TULLOCK v. MULVANE. No. 59. Supreme Court of United States. Argued October 25, 28, 1901. Decided March 3, 1902. ERROR TO THE SUPREME COURT OF THE STATE OF KANSAS. *502 Mr. W.H. Rossington for plaintiff in error. Mr. Charles Blood Smith and Mr. Clifford Histed were on his brief. Mr. N.H. Loomis for defendant in error. Mr. A.L. Williams was on his brief. MR. JUSTICE WHITE, after making the foregoing statement, delivered the opinion of the court.",
"*503 The assignments of error, though fourteen in number, are reducible to three propositions. 1. A contention that as the bond provided for a liability only in case it was finally decided that the injunction was wrongfully granted, no recovery could be had upon the bond, because the stipulation between the complainants and certain of the defendants had the effect of rendering it impossible to have a final determination in the courts of the United States whether the injunction ought originally to have been granted. 2. A claim on the part of the defendant that as the bond for injunction was executed under the order of a court of equity of the United States, and therefore by an authority exercised under the United States, and as liability was only to arise when it had been finally decided that the injunction ought not to have been granted, action on the bond could not be brought pending an appeal to the Circuit Court of Appeals of the United States, and the final determination by that court of the controversy. 3. An assertion that as, by the settled rule of the courts of equity of the United States, attorneys' fees were not an element of damage covered by the terms of an injunction bond given in such court, recovery of such fees on such bond was not within the purview of the bond when construed with reference to and by the light of the authority under which the bond was given.",
"It is urged by the defendant in error that these contentions involve no Federal question and that if they do they were not sufficiently set up in the lower courts, and therefore this court has no jurisdiction to review them. We dispose at once of the contention that if the propositions involve Federal questions they were not duly raised below, by referring to the statement which we have made of the case, whereby it appears that the contentions were raised below by the pleadings, by the objections to evidence and by the requests for instructions, and indeed as so raised were expressly considered and directly passed upon by both the trial court and the Supreme Court of the State of Kansas, which latter fact in and of itself suffices to present the Federal question, even if it had been otherwise *504 ambiguously raised on the record, which is not the case. Oxley Stave Co. v. Butler County, 166 U.S. 648.",
"In determining whether these Federal questions are involved, we shall for the moment take it for granted that the premises upon which such asserted questions rest are well founded, and if under such hypothesis we find that there is jurisdiction it will then be our duty to put such assumption out of view and determine the merits of the contentions. Whilst apparently the propositions involve several distinct assertions of Federal right, in their ultimate analysis they reduce themselves to one and the same contention; that is, that a bond given for an injunction in an equity cause in a court of the United States is to be construed with reference to the liability administered in the courts of the United States on that subject as settled by this court. That this fundamental proposition embraces all the contentions would seem to be clear, when it is borne in mind that the controversy as to the stipulation and as to the pendency of the cause in the Circuit Court of Appeals assert both the generic right of the defendant to have the obligations under the bond measured and determined by the law prevailing in the courts of the United States and the claim as to the attorneys' fees propounds but the same right as to one of the elements of damage which it was asserted the bond embraced. Whilst the unity of the propositions is thus demonstrable, as in the court below and in argument they have been separately treated and different considerations have been assumed to apply to them, we shall consider the propositions separately.",
"We embrace the first two contentions under one heading, as follows: First. Did the claim that there had been no breach of the condition of the bond because of the stipulation filed in the cause in which the bond was given and because of the pendency of the appeal in the Circuit Court of Appeals present Federal questions, and, if yes, were they well founded? It may not, we think, be doubted that a bond for injunction in an equity court of the United States given under the order of such court is a bond executed in and by virtue \"of an authority *505 exercised under the United States.\" Rev. Stat.",
"sec. 709. Certainly, the courts of the United States derive all their powers from the Constitution and laws of the United States, and their authority is therefore exercised thereunder. Being then an obligation entered into by virtue of such authority, the conclusion cannot be escaped that the defence specially set up that no liability on the bond could arise until the court of the United States in which the controversy was pending had finally determined that the injunction should not have been granted, was the assertion of an immunity from liability depending on an authority exercised under the United States, and therefore necessarily involved the decision of a Federal question. To state the result which must necessarily flow from a contrary deduction is sufficient of itself to demonstrate the unsoundness of the reasoning by which the non-Federal nature of the question can alone be upheld. For it is clear that if it be true that the bond given in a Federal court of equity on the granting of an injunction is not to be construed with reference to the rules of law applicable to such bonds in such court, then there can be no certain general rule by which to determine the liability of the obligors upon the bond. Their responsibility would be one thing in a court of the United States and a different thing in the courts of the various States, which would imply that the parties did not contract with reference to any definite rule of liability.",
"Indeed, the argument conduces to a conclusion which necessarily cripples the power of the court under whose order an injunction bond is executed. It is settled that such court has the inherent right to set the bond aside and to determine in its discretion whether recovery could be had upon it. Russell v. Farley, 105 U.S. 433. And yet if the liability upon the bond when given can be measured in courts other than the court requiring the execution of the bond, by a wholly different rule of liability from that which obtained in the court which had ordered the giving of the bond, it must follow that although the latter court had decreed that the injunction had rightfully issued, yet in an action upon the injunction bond in another forum the sureties might be made to respond in damages without hope of redress. A reference to some of the decided cases concerning what *506 constitutes a claim of immunity arising from an authority exercised under the United States, will serve at once to refute the contention that no Federal question is here presented. In Dupasseur v. Rochereau, 21 Wall. 130, the question for decision was whether a state court had given due effect to a decree of a court of the United States, and it was asserted that the contention that it had not presented no Federal question.",
"Speaking through Mr. Justice Bradley, the court said (p. 134): \"Where a state court refuses to give effect to the judgment of a court of the United States rendered upon the point in dispute, and with jurisdiction of the case and the parties, a question is undoubtedly raised which, under the act of 1867, may be brought to this court for revision. The case would be one in which a title or right is claimed under an authority exercised under the United States, and the decision is against the title or right so set up. It would thus be a case arising under the laws of the United States, establishing the Circuit Court and vesting it with jurisdiction; and hence it would be within the judicial power of the United States, as defined by the Constitution; and it is clearly within the chart of appellate power given to this court, over cases arising in and decided by the state courts.\" In Factors' & Traders' Insurance Company v. Murphy, 111 U.S. 738, a court of the United States sitting in bankruptcy had ordered a sale of real property of the bankrupt free from encumbrances.",
"The property was purchased at the sale on behalf of lienholders. Subsequently one who possessed a lien on the property at the time the order was entered and sale made, brought suit in a state court of Louisiana to foreclose such lien, claiming that she had not been a party to the bankruptcy proceedings, and that her lien was unaffected by the sale. The defendant, in whose name title had been taken, while averring that the plaintiff was interested in the purchase at the sale made under the order of the United States court, insisted that the lien of the mortgage of plaintiff had been extinguished by such sale. The state court having decreed in favor of plaintiff, a writ of error was prosecuted from this court. In reversing the judgment of the state court, it was said (p. 741): *507 \"Counsel for defendant in error deny the jurisdiction of this court and move to dismiss the writ.",
"But it is apparent that the only controversy in the case relates to the effect to be given to the sale under the order of the District Court of the United States, to sell the mortgaged property free from incumbrance. Both parties assert rights under this order and sale. Plaintiffs in error assert that the sale as made was valid, and, being sold free from incumbrances, extinguished Mrs. Murphy's lien as well as others. Defendant asserts that it had the effect of discharging all other liens but hers, and thus gave her the exclusive, paramount lien on all the property so sold.",
"Both the parties, therefore, rely upon rights under Federal authority, and as the right of plaintiff in error was denied by the court the writ of error lies.\" In Avery v. Popper, 179 U.S. 305, the two cases last above referred to were approvingly cited, and the rule was declared to be that where a controversy in the state court presented a contention as to the validity or proper construction of an order or decree rendered by a court of the United States, a Federal question was presented reviewable by this court (p. 314).",
"In Crescent Live Stock Company v. Butchers' Union, 120 U.S. 141, the facts were briefly these: Under a bill filed in a Circuit Court of the United States, a temporary injunction had been allowed after hearing, and a bond had been given under an order of the court, the injunction was perpetuated by the Circuit Court on the final hearing. The case was appealed to this court, and the decree of the Circuit Court was reversed. Suit was brought in a court of the State of Louisiana upon the injunction bond given in the Federal court, against the principal and surety in solido and against the principal alone, to recover damages for the malicious prosecution of the injunction suit in the Federal court. It was claimed by the defendants that the final decree of the Circuit Court of the United States, although subsequently reversed by this court, constituted probable cause, and therefore there could be no recovery on the alleged cause of action for malicious prosecution.",
"Both the state trial court by way of instructions to the jury and the Supreme Court of Louisiana decided that the decree of the Circuit Court of the *508 United States did not constitute probable cause, because prior to the decision of the Circuit Court of the United States a contrary view to that which the Circuit Court adopted had been announced by the highest court of the State of Louisiana. The jurisdiction of this court to review the controversy was challenged upon the very grounds now relied upon, and the court said (p. 146): \"It is argued by counsel for the defendant in error that this does not embrace any Federal question; that the effect to be given to a judgment or decree of the Circuit Court of the United States sitting in Louisiana by the courts of that State is to be determined by the law of Louisiana, or by some principle of general law as to which the decision of the state court is final; and that the ruling in question did not deprive the plaintiffs in error of `any privilege or immunity specially set up or claimed under the Constitution or laws of the United States.'",
"But this is an error. The question whether a state court has given due effect to the judgment of a court of the United States is a question arising under the Constitution and laws of the United States.\" In Meyers v. Block, 120 U.S. 206, the case came to this court on error to a state court, and involved the correctness of the construction by that court of the terms of an injunction bond given in a court of the United States. This court treated the matter of jurisdiction as one of course, held that the parties signing the bond must be presumed to have been cognizant of the order under which the bond was given, and to have contracted in reference thereto, and that the bond should be read in the light of the order, and the court applied to the interpretation of the bond its own views of the applicable principles of law.",
"The cases of New York Life Insurance Co. v. Hendren, 92 U.S. 286; Provident Savings Society v. Ford, 114 U.S. 635; Blackburn v. Portland Gold Mining Co., 175 U.S. 571, and others of like character, do not conflict with the rule which we apply in this cause, and which was expounded in the cases to which we have previously referred. This results when it is observed that none of the cases just above referred to involved *509 the construction or effect of a law of the United States or a judgment, decree or order or other act done under and by virtue of the authority of a court of the United States or a claim of immunity thereunder. The contention as to the prematurity of the suit presenting then a Federal controversy, the question is, was the claim of prematurity well founded? Previous to the bringing of the suit in the state court upon the bond, by stipulation filed in the equity cause in the United States court, upon which an order of the court was entered, the bill of complaint had been dismissed as to all the defendants but Mulvane, and it was expressly agreed that all demand for relief by way of specific performance should be withdrawn.",
"We think that the Circuit Court of Appeals correctly decided that the necessary effect of this agreement was to withdraw from the case all controversy on the subject of the injunction. As by the stipulation Mulvane had not waived any rights of action by reason of damages caused by the injunction if any, but on the contrary his rights were expressly saved, and as the stipulation was made the basis of an order of the court which had the necessary effect to dismiss from the cause all the grounds upon which alone the rightfulness of the injunction could have been asserted, we think there was a final decision, within the import of the condition of the bond, that the injunction ought not to have been granted.",
"As respects the argument that by reason of the execution of the stipulation, the sureties upon the injunction bond were absolutely discharged, because thereby a final determination of the rightfulness of the allowance of the injunction was prevented, we think it obvious that the sureties when executing the bond did so, subject to the right of the complainants in good faith to dismiss their bill, or to make a stipulation such as that we have referred to, which was in effect the equivalent of the dismissal of the bill in so far as all equitable relief was concerned. We are thus brought to consider the second contention, which is, Second. Did the claim of immunity from liability for attorneys' fees, as one of the elements of damage under the injunction bond, present a Federal question; and if yes, was it correctly *510 decided by the court below that it was proper to award the amount of such fees in enforcing the bond? The first branch of this question has already been disposed of by the reasons given and authorities cited in the consideration of the proposition previously passed upon. It is insisted, however, that such is not the case, because whilst it is true the courts of the United States exercise their authority under the Constitution and laws of the United States, that, as there is no express statutory authority regulating injunction bonds, therefore in determining the measure of liability on them no claim of immunity arising from an authority exercised under the United States can arise.",
"But this is a mere form of restating the contention we have already disposed of. The test is not the particular source, on form by which the authority of the United States has been conferred or is exerted, but whether such authority existed and was exercised and an immunity is claimed under it. Besides, by express provision of the Revised Statutes (sec. 617) proceedings of the courts of the United States in equity causes are subject to regulation by this court, with power to modify and change such rules. And rule No. 90, promulgated under the authority thus conferred, provides as follows: \"In all cases where the rules prescribed by this court or by the Circuit Court do not apply, the practice of the circuit court shall be regulated by the present practice of the High Court of Chancery in England, so far as the same may be reasonably applied consistently with the local circumstances and local conveniences of the district where the court is held, not as positive rules, but as furnishing just analogies to regulate the practice.\"",
"And it is by the force and effect of this rule that the equity courts of the United States exercise their power with respect to the exaction of security when granting writs of injunction. Russell v. Farley, 105 U.S. 433. It follows that proceedings in courts of equity of the United States are regulated by rules promulgated by this court deriving their force from statutory authority, and the argument which we have just considered, even if it were not erroneous, *511 would be inapposite. The jurisdiction to review being then established, it remains only to consider whether the attorneys' fees were properly allowed by the court below as an element of damages on the bond. That they were not, is settled. In Oelrichs v. Spain, 15 Wall. 211, this court, speaking through Mr. Justice Swayne, said (p. 230): \"The decree of the court below was preceded by the report of a master, which the decree affirmed and followed. Upon looking into the report we find it clear and able, and we are entirely satisfied with it, except in one particular.",
"We think that both the master and the court erred in allowing counsel fees, as a part of the damages covered by the bonds. \"In Arcambel v. Wiseman, 3 Dall. 306, decided by this court in 1796, it appeared `by an estimate of the damages upon which the decree was founded, and which was annexed to the record, that a charge of $1600 for counsel fees in the courts below had been allowed.' This court held that it `ought not to have been allowed.' The report is very brief. The nature of the case does not appear. It is the settled rule that counsel fees cannot be included in the damages to be recovered for the infringement of a patent. Tesse v. Huntingdon, 23 How. 2 (64 U.S. XVI.",
"479); Whittemore v. Cutter, 1 Gall. 429; Stimson v. The Railroads, 1 Wall. Jr. 164. They cannot be allowed to the gaining side in admiralty as incident to the judgment beyond the costs and fees allowed by the statute. The Baltimore, 8 Wall. 378 (75 U.S. XIX. 463). \"In actions of trespass where there are no circumstances of aggravation, only compensatory damages can be recovered, and they do not include the fees of counsel. The plaintiff is no more entitled to them, if he succeed, than is the defendant if the plaintiff be defeated.",
"Why should a distinction be made between them? In certain actions ex delicto vindictive damages may be given by the jury. In regard to that class of cases this court has said: `It is true that damages assessed by way of example may indirectly compensate the plaintiff for money expended in counsel fees, but the amount of these fees cannot be taken as the measure of punishment or a necessary element in its infliction.' Day v. Woodworth, 13 How. 370, 371. *512 \"The point here in question has never been expressly decided by this court, but it is clearly within the reasoning of the case last referred to, and we think is substantially determined by that adjudication. In debt, covenant and assumpsit damages are recovered, but counsel fees are never included. So in equity cases, where there is no injunction bond, only the taxable costs are allowed to the complainants.",
"The same rule is applied to the defendant, however unjust the litigation on the other side, and however large the expensa litis to which he may have been subjected. The parties in this respect are upon a footing of equality. There is no fixed standard by which the honorarium can be measured. Some counsel demand much more than others. Some clients are willing to pay more than others. More counsel may be employed then are necessary.",
"When both client and counsel know that the fees are to be paid by the other party there is danger of abuse. A reference to a master, or an issue to a jury, might be necessary to ascertain the proper amount, and this grafted litigation might possibly be more animated and protracted than that in the original cause. It would be an office of some delicacy on the part of the court to scale down the charges, as might sometimes be necessary. \"We think the principle of disallowance rests on a solid foundation, and that the opposite rule is forbidden by the analogies of the law and sound public policy.\" It is strenuously urged, however, and this was in effect the view taken by the court below, that although the rule against allowing attorneys' fees in actions on injunction bonds was thus settled by this court adverse to the right to recover such fees, as the local law was to the contrary, the injunction bond given in the Federal court must be enforced, not by the law of the forum in which it was given, but according to the rule of the local law.",
"This proposition, again, however, but embodies the contention that the question of the allowance of attorneys' fees involved no Federal question, which has already been disposed of. For if it be true, and it undoubtedly is, that the giving of such a bond was an act done pursuant to an authority exercised under the Constitution and laws of the United States, it must follow that the bond so taken is to be interpreted with *513 reference to the authority under which it was given and the principles of jurisprudence controlling such authority, and not by the local law. To hold the contrary, as we have previously pointed out, would be but to declare that although the power conferred by Congress upon this court to adopt equity rules is controlling, nevertheless the interpretations of the rules and the limitations which arise from a proper construction of them, as expounded by this court and enunciated in its decisions, are without avail.",
"And this yet further points out the fallacy involved in the contention that the lower court, in passing upon the issues, decided merely a question of general law involving no Federal controversy. Now it is at once conceded that the decision by a state court of a question of local or of general law involving no Federal element does not as a matter of course present a Federal question. But where on the contrary a Federal element is specially averred and essentially involved, the duty of this court to apply to such Federal question its own conceptions of the general law we think is incontrovertible. Avery v. Popper, 179 U.S. 305, 315. Whilst in the absence of authority the foregoing considerations suffice to dispose of the case, it is also effectually concluded by authority. Bein v. Heath, 12 How.",
"168. In that case, as in this, it was insisted that the local law should have been applied in construing and enforcing an injunction bond given in a court of the United States. But the court, in negativing the contention, speaking through Mr. Chief Justice Taney, said (p. 178): \"Now, there is manifest error in subjecting the parties to an injunction bond, given in a proceeding in equity in a court of the United States, to the laws of the State. The proceeding in a Circuit Court of the United States in equity is regulated by the laws of Congress, and the rules of this court made under the authority of an act of Congress. And the ninetieth rule declares that, when not otherwise directed, the practice of the High Court of Chancery in England shall be followed. The eighth rule authorizes the Circuit Court, both judges concurring, to modify the process and practice in their respective districts.",
"But this applies only to forms of proceeding and *514 mode of practice, and certainly would not authorize the adoption of the Louisiana law, defining the rights and obligations of parties to an injunction bond. Nor do we suppose any such rule has been adopted by the court. And if it has, it is unauthorized by law, and cannot regulate the rights or obligations of the parties. \"And when an injunction is applied for in the Circuit Court of the United States sitting in Louisiana, the court may grant it or not, according to the established principles of equity, and not according to the laws and practice of the State in which there is no court of chancery, as contra-distinguished from a court of common law. And they require a bond, or not, from the complainant, with sureties, before the injunction issues, as the court, in the exercise of a sound discretion, may deem it proper for the purposes of justice. And if, in the judgment of the court, the principles of equity require that a bond should be given, it prescribes the penalty and the condition also. And the condition prescribed by the court in this case, but which was not followed, is the one usually directed by the court.",
"\"In proceeding upon such a bond, the court would have no authority to apply to it the legislative provisions of the State.\" Indeed, the principles announced in Bein v. Heath were in effect but the reiteration of the doctrine previously established by this court, that a bond given in pursuance of a law of the United States was governed, as to its construction, not by the local law of a particular State, but by the principles of law as determined by this court, and operative throughout the courts of the United States. Cox v. United States, 6 Pet. 172; Duncan's Heirs v. United States, 7 Pet. 435. It follows from what we have stated that there was error committed in allowing the recovery of attorneys' fees as an element of damage upon the bond in question. The judgment of the Supreme Court of Kansas must be reversed, and the case remanded to that court for further proceedings not inconsistent with this opinion, and it is so ordered.",
"*515 MR. JUSTICE HARLAN, with whom concurred THE CHIEF JUSTICE and MR. JUSTICE BROWN, dissenting. This was an action in one of the courts of the State of Kansas upon an injunction bond executed in a suit in equity in the Circuit Court of the United States for the District of Kansas the condition of the bond being that the obligors would pay or cause to be paid to the obligees and to each of them, \"all damages which they, or either of them, have already sustained, or may at any time sustain, by reason of the granting and issuing of said restraining order, or the granting and issuing of said temporary injunction, if it shall be finally decided that said restraining order or said temporary injunction ought not to have been granted.\" There was a verdict and judgment against Tullock, one of the sureties in the bond.",
"Mulvane, the plaintiff, being dissatisfied with the amount of the verdict and the rulings of the trial court, prosecuted a writ of error to the Supreme Court of Kansas, where the judgment was reversed and the cause remanded for another trial. Mulvane v. Tullock, 58 Kansas, 622. That court said (p. 632): \"That counsel fees are recoverable as damages upon an injunction bond has been the uniform holding of this court from the beginning, and this appears to be the view taken by most of the courts of the country. Underhill v. Spencer, 25 Kansas, 71; Loofborow v. Shaffer, 28 Kansas, 71; Loofborow v. Shaffer, 29 Kansas, 415; Nimocks v. Welles, 42 Kansas, 39; 10 Am.",
"& Eng. Ency. of Law, 999, and cases cited. It appears, however, that there are some decisions of the Federal courts to the contrary, holding that the obligation of an injunction bond imposes no duty upon the obligor to pay the attorney's fees if the injunction is wrongfully obtained. Arcambel v. Wiseman, 3 Dallas, 306; Oelrichs v. Spain, 15 Wall. 211. It is contended that, as the bond was given in a case in one of the Federal courts, the obligation must be interpreted in accordance with the decisions of those courts. The claim is that the rules and decisions of the Supreme Court of the United States have the force of legislative declarations; that they enter into, and become a part of, the *516 contract of the sureties, who can only be held liable for such consequences as are the direct result of the breach and were within their contemplation at the time the bond was executed. No statute, however, prescribed the conditions of the bond nor limited the extent of liability thereon. It is true that it was within the general equitable power of the Federal court to prescribe the conditions upon which the injunction should issue.",
"It could have granted an injunction without requiring a bond, or it might, in its discretion, have imposed such terms as it saw fit as a condition of granting the injunction. It did require the giving of a bond, and the bond was executed in accordance with the order of the court. The bond executed is in the ordinary form; is in the nature of a contract; and the liability of the obligors depends, not on the Federal Constitution or a Congressional act, but on the proper interpretation of the bond itself. In the absence of a statute fixing the measure of damages or limiting the recovery, we think the bond should be viewed in the light of an independent contract, and is to be interpreted by the general principles of the common law.",
"It is not a mere incident of the injunction proceeding, nor can this, which is an ordinary action at law, be regarded as auxiliary to the proceeding in the Federal court. Being an independent contract, actionable in any state court where service upon the sureties can be obtained, the interpretation of the forum applies. As the action on the bond could be brought in the state court and, indeed, the present action could not have been brought in any other it cannot be said that the sureties contracted with reference to the view of the law taken by the Federal courts. They knew that the obligation was enforceable in the courts of the State of which the plaintiff and defendants were all residents, and that the highest court of that State had consistently held that counsel fees were recoverable upon an injunction bond.",
"That the bond was given in a Federal court, where a different rule of interpretation obtains, has not been deemed to affect the state court in determining the liability upon such bond when suit was brought thereon. Mitchell v. Hawley, 79 California, 301; Hannibal & St. Joseph Railroad v. Shepley, 1 Mo. App. *517 254; Wash. v. Lackland, 8 Mo. App. 122; Aiken v. Leathers, 40 La. Ann. 23; Corcoran v. Judson, 24 N.Y. 106.\" In addition to Corcoran v. Judson, 24 N.Y. 106, cited by the state court, see Coates v. Coates, 1 Duer, 664; Edwards v. Bodine, 11 Paige, 223, and Sedgwick on Damages, 177; also, Barton v. Fisk, 30 N.Y. 166, 171; Behrens v. McKenzie, 23 Iowa, 333, 342; Ford v. Loomis, 62 Iowa, 566, 588; Cook v. Chapman, 41 N.J. Eq. 152, 154; Noble v. Arnold, 23 Ohio St. 264, 270; Morris v. Price, 2 Blackf. 457; Derry Bank v. Heath, 45 N.H. 524; Ryan v. Anderson, 25 Ill. 372; Garrett v. Logan, 19 Alabama, 344.",
"At the second trial Mulvane obtained a verdict and judgment which embraced his counsel fees in the injunction suit, and that judgment having been affirmed by the Supreme Court of Kansas, (61 Kansas, 650,) it is sought to have it reviewed by this court, under section 709 of the Revised Statutes, upon the ground that by the action of the Supreme Court of Kansas the plaintiff in error, Tullock, was denied an \"immunity\" belonging to him under an \"authority exercised under the United States.\" The immunity so claimed is that he, Tullock, was erroneously held to be liable for the attorneys' fees which the obligee in such bond paid or became bound to pay in or about obtaining or dissolving the injunction in the suit in the Federal court.",
"Can this court review the action of the state court upon any such a question? Is it true that the alleged \"immunity\" arises from an \"authority exercised under the United States?\" In Avery v. Popper, 179 U.S. 305, 314, 315, this court, speaking by Mr. Justice Brown, said: \"With respect to writs of error from this court to judgments of state courts in actions between purchasers under judicial proceedings in the Federal courts and parties making adverse claims to the property sold, the true rule to be deduced from these authorities is this: That the writ will lie, if the validity or construction of the judgment of the Federal court, or the regularity of the proceedings under the execution, are assailed; but if it be admitted that the judgment was valid, and those proceedings were regular, that the purchaser took the title of the defendant in the execution, and the issue relates to the title to the property, as between the defendant *518 in the execution or the purchaser under it, and the party making the adverse claim, no Federal question is presented in other words, it must appear that the decision was made against a right claimed under Federal authority, in the language of Rev. Stat.",
"§ 709.\" Again: \"This was a question either of local law or of general law. If of local law, of course the decision of the Supreme Court of Texas is binding upon us. If of general law, as it involves no Federal element, it is equally binding in this proceeding, since only Federal rights are capable of being raised upon writs of error to state courts. Conceding that, if the question had arisen on appeal from a Circuit Court of the United States, we might have come to a different conclusion, it by no means follows that we can do so upon a writ of error to a state court, whose opinion upon a question of general law is not reviewable here.\"",
"Surely this case does not involve a Federal immunity simply because the bond in suit was taken under the authority of the Circuit Court of the United States. If it does, then this court erred in its decision in Provident Savings Society v. Ford, 114 U.S. 635, (reaffirmed in many subsequent cases,) in which it was contended that a suit upon a judgment rendered by a Federal court necessarily involved questions arising under the laws of the United States. That contention was overruled. This court, speaking by Mr. Justice Bradley, said: \"What is a judgment, but a security of record showing a debt due from one person to another? It is as much a mere security as a treasury note, or a bond of the United States. If A brings an action against B, trover or otherwise, for the withholding of such securities, it is not therefore a case arising under the laws of the United States, although the whole value of the securities depends upon the fact of their being the obligations of the United States.",
"So if A have title to land by patent of the United States and brings an action against B for trespass or waste, committed by cutting timber, or by mining and carrying away precious ores, or the like, it is not therefore a case arising under the laws of the United States. It is simply the case of an ordinary right of property sought to be enforced. A suit on a judgment is nothing more, unless some question is raised in the case (as might *519 be raised in any of the cases specified), distinctly involving the laws of the United States such a question, for example, as was ineffectually attempted to be raised by the defendant in this case.",
"If such a question were raised, then it is conceded it would be a case arising under the laws of the United States.\" In Blackburn v. Portland Gold Mining Co., 175 U.S. 571, it was held that the judgment of the Supreme Court of a State could not be reviewed simply because the case involved a contest between rival claimants of a mine under certain sections of the Revised Statutes. To the same effect are Florida Central & Peninsular Railroad Co. v. Bell, 176 U.S. 321; De Lamar's Mining Co. v. Nesbitt, 177 U.S. 523; Shoshone Mining Co. v. Rutter, 177 U.S. 505. There is no question in this case as to the validity of any authority exercised under the United States. The only question is as to the rights of one party and the liabilities of the other party under an ordinary injunction bond. What those rights and liabilities are cannot be determined by reference to the Constitution or any statute of the United States.",
"Nor has any rule been adopted by the Circuit Court of the United States limiting the legal effect of the words of the bond or declaring what damages should be covered by it. Of course, if Congress had enacted a statute prescribing the form of injunction bonds, and directing what liabilities should arise thereon against the obligors, that statute would control. But no such statute has been passed, and the question is left to be determined by the principles of general law. Reference has been made to Oelrichs v. Spain, 15 Wall. 211, in support of the proposition that the question presents an \"immunity\" which exists under Federal authority.",
"That case was brought in a Circuit Court of the United States. It does decide that attorneys' fee should not be allowed in a suit on injunction bonds. But there is in the opinion no hint even that the decision as to what damages can be allowed in such a suit rests upon a Federal ground. On the contrary, the court, after citing some authorities, says that \"the principle of disallowance rests on a solid foundation, and that the opposite view is forbidden by the analogies of the law and sound policy.\" *520 We have been referred also to Equity Rule 90 of this court, which declares that \"the practice of the Circuit Court shall be regulated by the present practice of the High Court of Chancery in England, so far as the same may be reasonably applied consistently with the local circumstances and local convenience of the district where the court is held, not as positive rules, but as furnishing just analogies to regulate the practice.\"",
"I cannot perceive that this rule has any pertinency, as it relates merely to practice, and not to the principles of law by which the rights and obligations of parties to injunction bonds are determinable. Bein v. Heath, 12 How. 168, 178, has been cited as showing that in allowing attorneys' fees the state court invaded a Federal right. That was a suit in the Circuit Court of the United States on an injunction bond taken in the same court. The trial court determined the case according to a statute of Louisiana defining the rights and obligations of the parties. This court held that \"in proceeding upon such a bond, the court would have no authority to apply to it the legislative provisions of the State. The obligors would be answerable for any damage or cost which the adverse party sustained, by reason of the injunction, from the time it was issued until it was dissolved, but to nothing more.",
"They would certainly not be liable for any aggravated interest on the debt, nor for the debt itself, unless it was lost by the delay, nor for the fees paid to the counsel for conducting the suit.\" Absolutely nothing is to be found in the opinion of the court sustaining the proposition that the rights and obligations of the parties to an injunction bond are determinable upon any principle of a Federal nature. The court referred to the 90th and 8th Equity rules, as furnishing authority for the taking of injunction bonds, but took care to say that those rules relate only to \"forms of proceeding and mode of practice,\" and not to \"the rights and obligations of parties to injunction bonds.\" And what was said in that case touching the rights and obligations of parties to injunction bonds was an expression of the views of the state court as to the general principles of law applicable in such cases. This is apparent from the extract given in the opinion of the court *521 from the opinion in Bein v. Heath.",
"In Meyers v. Block, cited in the opinion in this case, 120 U.S. 206, 211, the court said that there was no question \"as to the power of a court of equity to impose any terms in its discretion as a condition of granting or continuing an injunction.\" Russell v. Farley, 105 U.S. 433. Consequently the terms being prescribed, their meaning, in the absence of a statute, depends upon general, not Federal law. Cases have been cited which show that this court can re-examine the final judgment of the highest court of a State which fails to give due effect to a judgment, decree or order of a court of the United States. But such cases have no pertinency to the present discussion; for in the present case the state court did not disregard any judgment, decree or order of the Federal court. It did nothing more than enforce its views as to the rights and obligations of parties under a bond theretofore taken in a suit in a Federal court. Meyers v. Block, cited in the opinion, shows that our jurisdiction in that case was maintained solely because the case involved the question whether the injunction bonds there in suit were in conformity with the order of the Federal court in which they were taken. In N.Y. Life Ins. Co. v. Hendren, 92 U.S. 287, which was brought here from the highest court of Virginia, it was said: \"The case, therefore, having been presented to the court below for decision upon principles of general law alone, and it nowhere appearing that the Constitution, laws, treaties or executive proclamations of the United States were necessarily involved in the decision, we have no jurisdiction.\"",
"In United States v. Thompson, 93 U.S. 586, which came here from the highest court of Maryland, and in which suit the United States was a party, seeking payment of a debt it held against an insolvent partnership, the court said: \"It is not contended that this decision is repugnant to the Constitution, or any law or treaty of the United States; but the argument is, that, as the check of McFreely & Hopper was not paid, it did not pay their debt.",
"Whether this is so or not does not depend upon any statute of the United States, but upon the principles of general law alone. We have *522 many times held that we have no power to review the decisions of the State courts upon such questions. Bethel v. Demaret, 10 Wall. 537; Delmas v. Ins. Co., 14 Wall. 666; Ins. Co. v. Hendren, 92 U.S. 287; Rockhold v. Rockhold, 92 U.S. 130.\" In San Francisco v. Scott, 111 U.S. 268, referring to the question as to the effect of an alcalde grant of the pueblo title, and which was decided by the Supreme Court of California, it was said: \"This does not depend on any legislation of Congress, or on the terms of the treaty, but on the effect of the conquest upon the powers of local government in the pueblo under the Mexican laws. That is a question of general public law, as to which the decisions of the state court are not reviewable here.",
"This has been many times decided.\" Let it be observed that the jurisdiction of the state court, as between the parties and as to the subject-matter, is not disputed. The question before it was as to the extent of the liability of the sureties in the injunction bond. The decision of that question did not depend, in any degree, upon the Constitution or statutes of the United States. It depended entirely upon the meaning of the words of the bond, and the principles of law applicable to such an instrument. It was manifestly, therefore, a question of general law as distinguished from Federal law. Upon such a question the state court was entitled to give effect to its own views.",
"The question could not become a question of Federal law by reason alone of the fact that the bond was executed under the authority of the Circuit Court; for, as already said, neither the order under which the bond was taken, the validity of the bond nor the authority of the court was disputed. Nor could it become a Federal question because of any decision by this court in cases theretofore decided between other parties. Suppose this court had not, prior to the trial of this case, expressed any opinion upon that question of general law. Could it then have been contended that the judgment complained of denied any Federal immunity? If not, then the Federal immunity now claimed arises entirely from the failure of the state court to take the same view of a question of general law which this court took in prior cases between other parties. There has been a wide difference of opinion between this court and some of the state *523 courts upon certain questions of general law. But it has never been supposed that any one has such a vested interest in the views of this court upon questions of general law that he may complain of the refusal of a state court to accept those views as denying him an \"immunity\" existing or belonging to him, in virtue of an \"authority exercised under the United States.\"",
"In Winona & St. Peter Railroad v. Plainview, 143 U.S. 371, 390, which came to this court from the highest court of Minnesota, it was said: \"The fact that the Supreme Court of Minnesota, in the present cases, did not acquiesce in the correctness of the decision of the Circuit Court of the United States, did not constitute a Federal question. Neither the Constitution of the United States nor any act of Congress guarantees to a suitor that the same rule of law shall be applied to him by a state court which would be applied if his citizenship were such that his suit might be brought in a Federal court.\" Or, suppose two actions were brought in the Federal court (there being diversity of citizenship in each case) one on an injunction bond executed in a Circuit Court of the United States, and the other upon a like bond executed in a state court. What would be the ruling as to the measure of damages?",
"Would the court disallow counsel fees in the first case and allow them in the second case where the highest court of the State had established the principle that counsel fees could be recovered? Each branch of the latter question must, upon the principles of the opinion just delivered, be answered in the affirmative. But they cannot be so answered without placing the decisions of the courts upon a question of general law, on the same basis as a legislative enactment prescribing the measure of damages in suits on injunction bonds. Being unable to assent to the principle that a Federal immunity arises when a state court, in determining a question not involving the Constitution or laws of the United States nor the validity of an authority exercised under the United States, reaches a conclusion upon a question of general law different from that announced in prior cases by this court and denying our authority to compel a state court to disregard its own views *524 upon a question of general law, I am constrained to dissent from the opinion and judgment. MR. CHIEF JUSTICE FULLER and MR. JUSTICE BROWN concur in this opinion."
] | https://www.courtlistener.com/api/rest/v3/opinions/95609/ | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
EXHIBIT 10.21
CREDIT AGREEMENT
PLAINS MARKETING, L.P., as Borrower,
FLEET NATIONAL BANK, as Administrative Agent,
FLEET SECURITIES, INC., as Lead Arranger and Book Manager,
and CERTAIN FINANCIAL INSTITUTIONS, as Lenders
$200,000,000 Uncommited Senior Secured
Discretionary Contango Facility
November 21, 2003
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TABLE OF CONTENTS
ARTICLE I - Definitions and References
Section 1.1. Defined Terms
Section 1.2. Exhibits and Schedules; Additional Definitions
Section 1.3. Amendment of Defined Instruments
Section 1.4. References and Titles
Section 1.5. Calculations and Determinations
ARTICLE II - Loans and Letters of Credit
Section 2.1. Financing Requests, Commitments and Fundings
Section 2.2. Loans and Notes
Section 2.3. Requests for Loans
Section 2.4. Continuations and Conversions of Existing Loans
Section 2.5. Use of Proceeds
Section 2.6. Interest Rates and Fees
Section 2.7. Optional Prepayments
Section 2.8. Mandatory Prepayments and Payments
Section 2.9. Extension of Request Period.
Section 2.10. Letters of Credit
Section 2.11. Requesting Letters of Credit
Section 2.12. Reimbursement and Participations
Section 2.13. Letter of Credit Fees
Section 2.14. No Duty to Inquire
ARTICLE III - Payments to Lenders
Section 3.1. General Procedures
Section 3.2. Capital Reimbursement
Section 3.3. Increased Cost of LIBOR Loans or Letters of Credit
Section 3.4. Notice; Change of Applicable Lending Office
Section 3.5. Availability
Section 3.6. Funding Losses
Section 3.7. Reimbursable Taxes
Section 3.8. Replacement of Lenders.
ARTICLE IV - Conditions Precedent to Lending
Section 4.1. Documents to be Delivered
Section 4.2. Additional Conditions Precedent
ARTICLE V - Representations and Warranties
Section 5.1. No Default
Section 5.2. Organization and Good Standing
Section 5.3. Authorization
Section 5.4. No Conflicts or Consents
Section 5.5. Enforceable Obligations
i
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Section 5.6. Initial Financial Statements
Section 5.7. Other Obligations and Restrictions.
Section 5.8. Full Disclosure
Section 5.9. Litigation
Section 5.10. ERISA Plans and Liabilities
Section 5.11. Compliance with Permits, Consents and Law
Section 5.12. Environmental Laws
Section 5.13. Accounts; Title to Properties
Section 5.14. Government Regulation
Section 5.15. Insider
Section 5.16. Solvency
ARTICLE VI - Affirmative Covenants
Section 6.1. Payment and Performance
Section 6.2. Books, Financial Statements and Reports.
Section 6.3. Other Information and Inspections
Section 6.4. Notice of Material Events
Section 6.5. Maintenance of Existence, Qualifications and Assets
Section 6.6. Payment of Taxes, etc.
Section 6.7. Insurance
Section 6.8. Compliance with Agreements and Law
Section 6.9. Agreement to Deliver Security Documents
Section 6.10. Perfection and Protection of Security Interests and Liens
ARTICLE VII - Negative Covenants
Section 7.1. Limitation on Liens
Section 7.2. Limitation on Mergers
Section 7.3. Limitation on Sales of Collateral
Section 7.4. Limitation on New Businesses
Section 7.5. No Negative Pledges
ARTICLE VIII - Events of Default and Remedies
Section 8.1. Events of Default
Section 8.2. Remedies
ARTICLE IX - Administrative Agent
Section 9.1. Appointment and Authority
Section 9.2. Exculpation, Administrative Agent’s Reliance, Etc.
Section 9.3. Credit Decisions
Section 9.4. Indemnification
Section 9.5. Rights as Lender
Section 9.6. Sharing of Set-Offs and Other Payments
Section 9.7. Investments
Section 9.8. Benefit of Article IX
Section 9.9. Resignation
ii
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ARTICLE X - Miscellaneous
Section 10.1. Waivers and Amendments; Acknowledgments
Section 10.2. Survival of Agreements; Cumulative Nature
Section 10.3. Notices
Section 10.4. Payment of Expenses; Indemnity
Section 10.5. Parties in Interest; Assignments; Replacement Notes
Section 10.6. Confidentiality
Section 10.7. Governing Law; Submission to Process
Section 10.8. Limitation on Interest
Section 10.9. Right of Offset
Section 10.10. Termination; Limited Survival
Section 10.11. Severability
Section 10.12. Counterparts
Section 10.13. Waiver of Jury Trial, Punitive Damages, etc.
Section 10.14. Replacement Credit Facility
iii
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Schedules and Exhibits:
Schedule 1 - Lender Schedule
Schedule 2 - Disclosure Schedule
Schedule 3 - Security Schedule
Schedule 4 - Pricing Grid
Schedule 5 - Currently Approved Persons and Facilities
Exhibit A - Note
Exhibit B-1 - Financing Request-Initial
Exhibit B-2 - Financing Request-Final
Exhibit B-3 - Borrowing Notice
Exhibit C - Continuation/Conversion Notice
Exhibit D-1 - Opinion of In-House Counsel for Borrower
Exhibit D-2 - Opinion of Fulbright & Jaworski L.L.P., Counsel for Borrower
Exhibit E - Form of Letter of Credit
Exhibit F - Letter of Credit Application and Agreement
Exhibit G - Assignment and Acceptance Agreement
iv
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT is made as of November 21, 2003, by and among PLAINS MARKETING, L.P., a Delaware limited partnership (“Borrower”), FLEET NATIONAL BANK, as administrative agent (in such capacity, “Administrative Agent”), FLEET SECURITIES, INC., as lead arranger and book manager (in such capacity, “Lead Arranger and Book Manager”) and the Lenders referred to below. In consideration of the mutual covenants and agreements contained herein the parties hereto agree as follows:
W I T N E S S E T H
In consideration of the mutual covenants and agreements contained herein and in consideration of the loans which may hereafter by made by Lenders, in each Lender’s sole and absolute discretion, and the Letters of Credit which may be made available by LC Issuer to Borrower upon Lenders’ election to participate in such Letters of Credit, in each Lender’s sole and absolute discretion, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I - Definitions and References
Section 1.1. Defined Terms. As used in this Agreement, each of the following terms has the meaning given to such term in this Section 1.1 or in the sections and subsections referred to below:
“Account” shall have the meaning given that term in the UCC.
“Account Debtor” means any Person who is or who may become obligated under, with respect to, or on account of, an Account.
“Administrative Agent” means Fleet National Bank, as Administrative Agent hereunder, and its successors in such capacity.
“Affiliate” means, as to any Person, each other Person that directly or indirectly (through one or more intermediaries or otherwise) controls, is controlled by, or is under common control with, such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person possesses, directly or indirectly, power to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
“Agreement” means this Credit Agreement.
“Applicable Lending Office” means, for each Lender and for each Type of Loan, the “Lending Office” of such Lender (or of an Affiliate of such Lender) designated for such Type of Loan on the Lender Schedule or such other office of such Lender (or an Affiliate of such Lender) as such Lender may from time to time specify to Administrative Agent and Borrower by written
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notice in accordance with the terms hereof as the office by which its Loans of such Type are to be made and maintained.
“Applicable Margin” means, as to any Type of Loan, the percent per annum set forth on the Pricing Grid as the “Applicable Margin” for such Type of Loan, based on the Applicable Rating Level in effect on such date. Changes in the Applicable Margin will occur automatically without prior notice as changes in the Applicable Rating Level occur. Administrative Agent will give notice promptly to Borrower and Lenders of changes in the Applicable Margin.
“Applicable Rating Level” means for any day, the level set forth below that corresponds to the PAA Debt Rating by the Ratings Agencies applicable on such day; provided, in the event the PAA Debt Rating by the Ratings Agencies differs by one level, the higher PAA Debt Rating shall apply; provided further, in the event the PAA Debt Rating by the Ratings Agencies differs by more than one level, the PAA Debt Rating one level above the lower PAA Debt Rating shall apply; provided, notwithstanding the foregoing, the Applicable Rating Level for the period from the date hereof through and including February 21, 2004 shall be Level III. As used in this definition, “ >“ means a rating equal to or more favorable than and “<“ means a rating less favorable than.
Rating Level
S&P
Moody’s
Level I
> BBB+
> Baa1
Level II
BBB
Baa2
Level III
BBB-
Baa3
Level IV
< BBB-
< Baa3
If either of the Rating Agencies shall not have in effect a PAA Debt Rating or if the rating system of either of the Rating Agencies shall change, or if either of the Rating Agencies shall cease to be in the business of rating corporate debt obligations, Borrower and Majority Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such Rating Agency, but until such an agreement shall be reached, the Applicable Rating Level shall be based only upon the PAA Debt Rating by the remaining Rating Agency.
“Approved Eligible Receivables” means an Eligible Receivable (a) from a Person whose Debt Rating is either at least Baa3 by Moody’s or at least BBB- by S&P; (b) fully and unconditionally guaranteed as to payment by a Person whose Debt Rating is either at least Baa3 by Moody’s or at least BBB- by S&P; (c) from any other Person Currently Approved by Majority Lenders; or (d) fully covered by a letter of credit from any national or state bank or trust company which is organized under the laws of the United States of America or any state thereof or any branch licensed to operate under the laws of the United States of America or any state thereof, which is a branch of a bank organized under any country which is a member of the Organization
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for Economic Cooperation and Development, in each case which has capital, surplus and undivided profits of at least $500,000,000 and whose commercial paper is rated at least P-1 by Moody’s or A-1 by S&P.
“Approved Location” means (i) a Plains Terminal, (ii) storage locations or pipelines Currently Approved by Majority Lenders for which Administrative Agent has received a bailee letter in form and substance reasonably acceptable to Administrative Agent with respect to any Collateral stored at such locations or pipelines, or (iii) storage locations or pipelines Currently Approved by Majority Lenders storing Financed Hedged Eligible Inventory not in excess of five percent (5%) of all Financed Hedged Eligible Inventory.
“Base Rate” means the higher of (i) the variable per annum rate of interest so designated from time to time by Administrative Agent as its “prime rate”, or (ii) the Federal Funds Rate plus one-half percent (0.5%) per annum. The “prime rate” is a reference rate and does not necessarily represent the lowest or best rate being charged to any customer. Changes in the Base Rate resulting from changes in the “prime rate” shall take place immediately without notice or demand of any kind.
“Base Rate Loan” means a Loan to Borrower which does not bear interest at a rate based upon the LIBOR Rate.
“Borrower” means Plains Marketing, L.P., a Delaware limited partnership.
“Borrowing” means a borrowing of new Loans of a single Type pursuant to Section 2.3 or a Continuation or Conversion of existing Loans into a single Type (and, in the case of LIBOR Loans, with the same Interest Period) pursuant to Section 2.4.
“Borrowing Notice” means a written or telephonic request, or a written confirmation, made by a Borrower which meets the requirements of Section 2.3.
“Broker Liens” means any Liens under or with respect to accounts with brokers or counterparties with respect to Hedging Contracts in favor of such brokers or counterparties, securing only obligations under such Hedging Contracts.
“Business Day” means any day, other than a Saturday, Sunday or day which shall be in the Commonwealth of Massachusetts a legal holiday or day on which banking institutions are required or authorized to close. Any Business Day in any way relating to LIBOR Loans (such as the day on which an Interest Period begins or ends) must also be a day on which commercial banks settle payments in London.
“Cash and Carry Purchases” means purchases of Petroleum Products for physical storage at an Approved Location which qualify as Hedged Eligible Inventory.
“Cash Equivalents” means Investments in:
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(a) marketable obligations, maturing within 12 months after acquisition thereof, issued or unconditionally guaranteed by the United States of America or the federal government of Canada or an instrumentality or agency thereof and entitled to the full faith and credit of the United States of America or the federal government of Canada, as the case may be;
(b) demand deposits and time deposits (including certificates of deposit) maturing within 12 months from the date of deposit thereof, (i) with any office of any Lender or (ii) with a domestic office of any national, state or provincial bank or trust company which is organized under the Laws of the United States of America or any state therein, or the federal government of Canada or any province therein, which has capital, surplus and undivided profits of at least $500,000,000, and whose long term certificates of deposit are rated at least Aa3 by Moody’s or AA- by S&P;
(c) repurchase obligations with a term of not more than seven days for underlying securities of the types described in subsection (a) above entered into with (i) any Lender or (ii) any other commercial bank meeting the specifications of subsection (b) above;
(d) open market commercial paper, maturing within 270 days after acquisition thereof, which are rated at least P-1 by Moody’s or A-1 by S&P; and
(e) money market or other mutual funds substantially all of whose assets comprise securities of the types described in subsections (a) through (d) above.
“Change of Control” means PAA shall cease to be, directly or indirectly, the sole legal and beneficial owner (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended) of all of the partnership interests (including all securities which are convertible into partnership interests) of Borrower.
“Code” means the Internal Revenue Code of 1986, as amended from time to time, together with all rules and regulations promulgated with respect thereto.
“Collateral” means all property of any kind which is subject to a Lien in favor of Lenders (or in favor of Administrative Agent for the benefit of Lenders) or which, under the terms of any Security Document, is purported to be subject to such a Lien, in each case granted or created to secure all or part of the Obligations.
“Consolidated” refers to the consolidation of any Person, in accordance with GAAP, with its properly consolidated subsidiaries. References herein to a Person’s Consolidated financial statements, financial position, financial condition, liabilities, etc. refer to the consolidated financial statements, financial position, financial condition, liabilities, etc. of such Person and its properly consolidated subsidiaries.
“Continue”, “Continuation” and “Continued” shall refer to the continuation pursuant to Section 2.4 of a LIBOR Loan as a LIBOR Loan from one Interest Period to the next Interest Period.
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“Continuation/Conversion Notice” means a written or telephonic request, or a written confirmation, made by Borrower which meets the requirements of Section 2.4.
“Convert, “Conversion” and “Convert” refers to a conversion pursuant to Section 2.4 of one Type of Loan into another Type of Loan.
“Currently Approved by Majority Lenders” means such Person (including a limit on the maximum Hedged Eligible Inventory sold to any such Person), storage location, pipeline, form of Letter of Credit or other matter as the case may be, as reflected in Schedule 5 attached hereto and as amended from time to time by the most recent written notice given by Administrative Agent to Borrower as being approved by Majority Lenders. Each such amended Schedule 5 will supersede and revoke each prior Schedule 5.
“Default” means any Event of Default and any default, event or condition which would, with the giving of any requisite notices and the passage of any requisite periods of time, constitute an Event of Default.
“Default Rate” means, at the time in question, two percent (2%) per annum plus:
(a) the LIBOR Rate plus the Applicable Margin then in effect for each LIBOR Loan (up to the end of the applicable Interest Period),
(b) the Base Rate plus the Applicable Margin then in effect for each Base Rate Loan,
provided, however, the Default Rate shall never exceed the Highest Lawful Rate.
“Default Rate Period” means (i) any period during which an Event of Default, other than pursuant to Section 8.1 (a) or (b), is continuing, provided that such period shall not begin until notice of the commencement of the Default Rate has been given to Borrower by Administrative Agent upon the instruction by Majority Lenders and (ii) any period during which any Event of Default pursuant to Section 8.1 (a) or (b) is continuing unless Borrower has been notified otherwise by Administrative Agent upon the instruction by Majority Lenders.
“Delivery Month” has the meaning given to such term in Section 2.1(a).
“Disclosure Schedule” means Schedule 2 hereto.
“Dollars” and “$” means the lawful currency of the United States of America, except where otherwise specified.
“Eligible Inventory” means inventories of Petroleum Products in which Borrower has lawful and absolute title (specifically excluding, however, tank bottoms and pipeline linefill of Borrower classified as a long-term asset), which are not subject to any Lien in favor of any Person (other than Permitted Inventory Liens), which are subject to a fully perfected first priority security interest (subject only to Permitted Inventory Liens) in favor of Administrative Agent pursuant to the Loan Documents prior to the rights of, and enforceable as such against, any other
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Person, which are otherwise satisfactory to Majority Lenders in their reasonable business judgment and located at Approved Locations, minus without duplication the amount of any Permitted Inventory Lien on any such inventory.
“Eligible Receivables” means, at the time of any determination thereof (and without duplication), each Account and, with respect to each determination made on or after the 20th day of each calendar month and prior to the first day of the next calendar month, each amount which will be, in the good faith estimate reasonably determined by Borrower, an Account of the Borrower with respect to sales and deliveries of Hedged Eligible Inventory during such calendar month or deliveries of Hedged Eligible Inventory during the next calendar month under firm written purchase and sale agreements, in either event as to which the following requirements have been fulfilled (or as to future Accounts, will be fulfilled as of the date of such sales and deliveries of Hedged Eligible Inventory), to the reasonable satisfaction of Administrative Agent:
(i) Borrower has lawful and absolute title to such Account;
(ii) such Account is a valid, legally enforceable obligation of an Account Debtor payable in Dollars, arising from the sale and delivery of Hedged Eligible Inventory to such Person in the United States of America in the ordinary course of business of Borrower, to the extent of the volumes of Hedged Eligible Inventory delivered to such Person prior to the date of determination;
(iii) there has been excluded from such Account (A) any portion that is subject to any dispute, rejection, loss, non-conformance, counterclaim or other claim or defense on the part of any Account Debtor or to any claim on the part of any Account Debtor denying liability under such Account, and (B) the amount of any account payable or other liability owed by Borrower to the Account Debtor on such Account, whether or not a specific netting agreement may exist, excluding, however, any portion of any such account payable or other liability which is at the time in question covered by a Letter of Credit;
(iv) Borrower has the full and unqualified right to assign and grant a security interest in such Account to Administrative Agent as security for the Obligation;
(v) such Account (A) is evidenced by an invoice rendered to the Account Debtor, or (B) represents the uninvoiced amount in respect of volumes of Hedged Eligible Inventory scheduled to be delivered by Borrower in the current or next-following calendar month, is governed by a purchase and sale agreement, exchange agreement or other written agreement, and in either event such Account is not evidenced by any promissory note or other instrument;
(vi) such Account is not subject to any Lien in favor of any Person and is subject to a fully perfected first priority security interest in favor of Administrative Agent pursuant to the Loan Documents, prior to the rights of, and enforceable as such against, any other Person except for a Lien in respect of First Purchase Crude Payables;
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(vii) such Account is due not more than 30 days following the last day of the calendar month in which the Hedged Eligible Inventory delivery occurred and is not more than 30 days past due;
(viii) such Account is not payable by an Account Debtor with more than twenty percent (20%) of its Accounts to Borrower that are outstanding more than 60 days from the invoice date;
(ix) the Account Debtor in respect of such Account (A) is located, is conducting significant business or has significant assets in the United States of America or is a Person Currently Approved by Majority Lenders, (B) is not an Affiliate of Borrower, and (C) is not the subject of any event of the type described in Section 8.1(i); and
(x) the Account Debtor in respect of such Account is not a governmental authority, domestic or foreign.
“Eligible Transferee” means a Person which either (a) is a Lender, or (b) is consented to as an Eligible Transferee by Administrative Agent and, so long as no Default or Event of Default is continuing, by Borrower, which consents in each case will not be unreasonably withheld; provided no Person organized outside the United States may be an Eligible Transferee if Borrower would be required to pay withholding taxes on interest or principal owed to such Person.
“Environmental Laws” means any and all Laws relating to the environment or to emissions, discharges, releases or threatened releases of pollutants, contaminants, chemicals, or industrial, toxic or hazardous substances or wastes into the environment including ambient air, surface water, ground water, or land, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handling of pollutants, contaminants, chemicals, or industrial, toxic or hazardous substances or wastes.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, together with all rules and regulations promulgated with respect thereto.
“ERISA Affiliate” means Borrower and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control that, together with Borrower, are treated as a single employer under Section 414 of the Code.
“ERISA Plan” means any employee pension benefit plan subject to Title IV of ERISA maintained by any ERISA Affiliate with respect to which Borrower has a fixed or contingent liability.
“Event of Default” has the meaning given to such term in Section 8.1.
“Existing Agreements” means (i) that certain Second Amended and Restated Credit Agreement [Revolving Credit Facility] dated July 2, 2002 among Borrower and certain
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Affiliates, Fleet National Bank, as administrative agent, and the agents and lenders named therein, and (ii) that certain Second Amended and Restated Credit Agreement [Letter of Credit and Hedged Inventory Facility] dated July 2, 2003 among Borrower and certain Affiliates, Fleet National Bank, as administrative agent, and the agents and lenders named therein.
“Facility Usage” means, at the time in question, the aggregate amount of Loans and LC Obligations with respect to Letters of Credit outstanding at such time.
“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/1000th of one percent) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (i) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average rate quoted to Administrative Agent on such day on such transactions as determined by Administrative Agent.
“Financed Hedged Eligible Inventory” means all Hedged Eligible Inventory that one or more Lenders have (i) committed to participate in letters of credit to secure the purchase of such Hedged Eligible Inventory pursuant to Cash and Carry Purchases and/or (ii) committed to finance (a) the purchase of such Hedged Eligible Inventory pursuant to Cash and Carry Purchases or (b) the storage of such Hedged Eligible Inventory at Approved Locations.
“First Purchase Crude Payables” means the unpaid amount of any payable obligation related to the purchase of Petroleum Products by Borrower secured by a statutory Lien, including but not limited to the statutory Liens, if any, created under the laws of Texas, New Mexico, Wyoming, Kansas, Oklahoma or any other state to the extent such payable obligation is not at the time in question covered by a Letter of Credit.
“Fiscal Quarter” means a three-month period ending on March 31, June 30, September 30 or December 31 of any year.
“Fiscal Year” means a twelve-month period ending on December 31 of any year.
“Funding Date” has the meaning given to such term in Section 2.1(a).
“GAAP” means those generally accepted accounting principles and practices which are recognized as such by the Financial Accounting Standards Board (or any generally recognized successor) and which, in the case of Borrower and its Consolidated Subsidiaries, are applied for all periods after the date hereof in a manner consistent with the manner in which such principles and practices were applied to the Initial Financial Statements. If any change in any accounting principle or practice is required by the Financial Accounting Standards Board (or any such successor) in order for such principle or practice to continue as a generally accepted accounting principle or practice, all reports and financial statements required hereunder with respect to
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Borrower or with respect to Borrower and its Consolidated Subsidiaries may be prepared in accordance with such change, but all calculations and determinations to be made hereunder may be made in accordance with such change only after notice of such change is given to each Lender and Majority Lenders agree to such change insofar as it affects the accounting of Borrower or of Borrower and its Consolidated Subsidiaries.
“GP Inc.” means Plains Marketing GP Inc., a Delaware corporation, the sole general partner of Borrower.
“Hazardous Materials” means any substances regulated under any Environmental Law, whether as pollutants, contaminants, or chemicals, or as industrial, toxic or hazardous substances or wastes, or otherwise.
“Hedged Eligible Inventory” means Petroleum Products scheduled to be purchased by Borrower in the month following delivery of a Financing Request-Initial specified as Hedged Eligible Inventory therein, which has been hedged by either a NYMEX contract, an OTC contract or a contract for physical delivery to an investment-grade counterparty or other counterparty Currently Approved by Majority Lenders and which, upon such purchase by Borrower, shall qualify as Eligible Inventory.
“Hedged Value” means, as to Hedged Eligible Inventory specified in a Financing Request-Initial or Financing Request-Final and the corresponding Hedging Contract or Hedging Contracts with respect thereto, an amount equal to the volume of such Hedged Eligible Inventory times the prices fixed in such corresponding hedge, minus (i) all related storage, transportation and other applicable costs of such Hedged Eligible Inventory, as set forth therein and (ii) the amount secured by any Broker Liens, other than Broker Liens on margin deposits with respect to such corresponding Hedging Contracts.
“Hedging Contract” means (a) any agreement providing for options, swaps, floors, caps, collars, forward sales or forward purchases involving interest rates, commodities or commodity prices, equities, currencies, bonds, or indexes based on any of the foregoing, (b) any option, futures or forward contract traded on an exchange, and (c) any other derivative agreement or other similar agreement or arrangement.
“Highest Lawful Rate” means, with respect to each Lender Party to whom Obligations are owed, the maximum nonusurious rate of interest that such Lender Party is permitted under applicable Law to contract for, take, charge, or receive with respect to such Obligations. All determinations herein of the Highest Lawful Rate, or of any interest rate determined by reference to the Highest Lawful Rate, shall be made separately for each Lender Party as appropriate to assure that the Loan Documents are not construed to obligate any Person to pay interest to any Lender Party at a rate in excess of the Highest Lawful Rate applicable to such Lender Party.
“Indebtedness” of any Person means each of the following:
(a) its obligations for the repayment of borrowed money,
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(b) its obligations to pay the deferred purchase price of property or services (excluding trade account payables arising in the ordinary course of business), other than contingent purchase price or similar obligations incurred in connection with an acquisition and not yet earned or determinable,
(c) its obligations evidenced by a bond, debenture, note or similar instrument,
(d) its obligations, as lessee, constituting principal under Capital Leases,
(e) its direct or contingent reimbursement obligations with respect to the face amount of letters of credit pursuant to the applications or reimbursement agreements therefor,
(f) its obligations for the repayment of outstanding banker’s acceptances, whether matured or unmatured,
(g) its obligations under any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing if the obligation under such synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing is considered indebtedness for borrowed money for tax purposes but is classified as an operating lease in accordance with GAAP (excluding, to the extent included herein, operating leases entered into in the ordinary course of business), or
(h) its obligations under guaranties of any obligations of any other Person described in the foregoing clauses (a) through (g).
“Initial Financial Statements” means (i) the audited Consolidated financial statements of PAA as of December 31, 2002, (ii) the unaudited consolidating balance sheet and income statement of PAA as of September 30, 2003, (iii) the unaudited Consolidated financial statements of Borrower as of December 31, 2002, and (iv) the unaudited consolidating balance sheet and income statement of Borrower as of September 30, 2003.
“Interest Payment Date” means (a) with respect to each Base Rate Loan, the last day of each March, June, September and December beginning December 31, 2003, and (b) with respect to each LIBOR Loan, the last day of the Interest Period that is applicable thereto and, if such Interest Period is six or twelve months in length, the dates specified by Administrative Agent which are approximately three, six, and nine months (as appropriate) after such Interest Period begins; provided that the last Business Day of each calendar month shall also be an Interest Payment Date for each such Loan so long as any Event of Default exists under Section 8.1(a) or (b).
“Interest Period” means, with respect to each particular LIBOR Loan in a Borrowing, the period specified in the Borrowing Notice or Continuation/Conversion Notice applicable thereto, beginning on and including the date specified in such Borrowing Notice or Continuation/Conversion Notice (which must be a Business Day), and ending one, two, three, six or twelve months (if twelve months is available for each Lender) thereafter (and, as to Loans, ending on a date less than 30 days thereafter as may be specified by Borrower, if such lesser period is available for
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each Lender), as Borrower may elect in such notice; provided that: (a) any Interest Period which would otherwise end on a day which is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day; (b) any Interest Period which begins on the last Business Day in a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day in a calendar month; and (c) notwithstanding the foregoing, no Interest Period may be selected for a Loan to Borrower that would end after the Maturity Date.
“Investment” means any investment made, directly or indirectly in any Person, whether by acquisition of shares of capital stock, indebtedness or other obligations or securities or by loan, advance, capital contribution or otherwise, and whether made in cash, by the transfer of property or by any other means.
“Law” means any statute, law, regulation, ordinance, rule, treaty, judgment, order, decree, permit, concession, franchise, license, agreement or other governmental restriction of the United States or Canada or any state, province, or political subdivision thereof or of any foreign country or any department, state, province or other political subdivision thereof.
“LC Application” means any application for a Letter of Credit hereafter made by Borrower to LC Issuer.
“LC-Backed Purchase Contracts” has the meaning given to such term in Section 2.1(a).
“LC Collateral” has the meaning given such term in Section 2.15(a).
“LC Issuer” means Fleet National Bank, in its capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity. Administrative Agent may, with the consent of Borrower and the Lender in question, appoint any Lender hereunder as an LC Issuer in place of or in addition to Fleet National Bank.
“LC Obligations” means, at the time in question, the sum of all Matured LC Obligations plus the maximum amounts which LC Issuer might then or thereafter be called upon to advance under all Letters of Credit then outstanding.
“Lender Parties” means Administrative Agent, LC Issuer and all Lenders.
“Lenders” means each signatory hereto designated as a Lender, and the successors and permitted assigns of each such party as holder of a Note.
“Lender Schedule” means Schedule 1 hereto.
“Letter of Credit” means any letter of credit issued by LC Issuer hereunder at the application of Borrower.
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“Letter of Credit Fee Rate” means, on any day, the rate per annum set forth on the Pricing Grid as the “LC Fee Rate” based on the Applicable Rating Level on such date. Changes in the applicable Letter of Credit Fee Rate will occur automatically without prior notice as changes in the Applicable Rating Level occur. Administrative Agent will give notice promptly to Borrower and Lenders of changes in the Letter of Credit Fee Rate.
“Liabilities” means, as to any Person, all indebtedness, liabilities and obligations of such Person, whether matured or unmatured, liquidated or unliquidated, primary or secondary, direct or indirect, absolute, fixed or contingent, and whether or not required to be considered pursuant to GAAP.
“LIBOR Loan” means a Loan that bears interest at a rate based upon the LIBOR Rate.
“LIBOR Rate” means, as applicable to any LIBOR Loan within a Borrowing and with respect to the related Interest Period therefor, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) as determined on the basis of offered rates for deposits in Dollars, for a period of time comparable to such Interest Period which appears on Telerate Page 3750 (or any successor page) as of 11:00 a.m. London time on the day that is two Business Days preceding the first day of such LIBOR Loan; provided, however, if the rate described above does not appear on the Telerate system on any applicable interest determination date, the LIBOR Rate shall be the rate (rounded upwards as described above, if necessary) for deposits in dollars for a period substantially equal to such Interest Period on the Reuters Page “LIBOR” (or such other page as may replace the LIBOR Page on that service for the purpose of displaying such rates), as of 11:00 a.m. (London time), on the date that is two Business Days prior to the beginning of such Interest Period; provided, however, if more than one rate is specified on Reuters Screen LIBOR Page, the applicable rate shall be the arithmetic mean of all such rates (rounded upwards, if necessary, to the nearest 1/1000 of 1%). If both the Telerate and Reuters system are unavailable, then the LIBOR Rate for that date will be determined on the basis of the offered rates for deposits in Dollars for a period of time comparable to such Interest Period which are offered by four major banks in the London interbank market at approximately 11:00 a.m. London time, on the day that is two (2) Business Days preceding the first day of such LIBOR Loan as selected by Administrative Agent. The principal London office of each of the four major London banks will be requested to provide a quotation of its Dollar deposit offered rate. If at least two such quotations are provided, the rate for that date will be the arithmetic mean of the quotations. If fewer than two quotations are provided as requested, the rate for that date will be determined on the basis of the rates quoted for loans in Dollars to leading European banks for a period of time comparable to such Interest Period offered by major banks in New York City at approximately 11:00 a.m. New York City time, on the day that is two Business Days preceding the first day of such LIBOR Loan. In the event that Administrative Agent is unable to obtain any such quotation as provided above, it will be deemed that the LIBOR Rate pursuant to such LIBOR Loan cannot be determined. In the event that the Board of Governors of the Federal Reserve System shall impose a Reserve Percentage with respect to LIBOR deposits of any Lender, then for any period during which such Reserve Percentage shall apply, the LIBOR Rate shall be equal to the amount determined above divided by an amount equal to 1 minus the Reserve Percentage. “Reserve Percentage” means the maximum aggregate reserve requirement (including all basic, supplemental, marginal, special, emergency and other reserves) which is imposed on member
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banks of the Federal Reserve System against “Euro-currency Liabilities” as defined in Regulation D. Without limiting the effect of the foregoing, the Reserve Percentage shall reflect any other reserves required to be maintained by such member banks with respect to (a) any category of liabilities which includes deposits by reference to which the LIBOR Rate is to be determined, or (b) any category of extensions of credit or other assets which include LIBOR Loans. The LIBOR Rate for any LIBOR Loan shall change whenever the Reserve Percentage changes.
“Lien” means, with respect to any property or assets, any right or interest therein of a creditor to secure Liabilities owed to it or any other arrangement with such creditor which provides for the payment of such Liabilities out of such property or assets or which allows such creditor to have such Liabilities satisfied out of such property or assets prior to the general creditors of any owner thereof, including any lien, mortgage, security interest, pledge, deposit, production payment, rights of a vendor under any title retention or conditional sale agreement or lease substantially equivalent thereto, tax lien, mechanic’s or materialman’s lien, or any other charge or encumbrance for security purposes, whether arising by Law or agreement or otherwise, but excluding any right of offset which arises without agreement in the ordinary course of business. “Lien” also means any filed financing statement, any registration of a pledge (such as with an issuer of uncertificated securities), or any other arrangement or action which would serve to perfect a Lien described in the preceding sentence, regardless of whether such financing statement is filed, such registration is made, or such arrangement or action is undertaken before or after such Lien exists.
“Loan Documents” means this Agreement, the Notes, the Letters of Credit, the LC Applications, and all other agreements, certificates, documents, instruments and writings at any time delivered in connection herewith or therewith (exclusive of term sheets and commitment letters).
“Loans” means loans by Participating Lenders to Borrower pursuant to Section 2.2.
“Majority Lenders” means Lenders whose Percentage Shares equal or exceed fifty-one percent (51%).
“Material Adverse Change” means a material and adverse change, from the state of affairs presented in the Initial Financial Statements or as represented or warranted in any Loan Document, to (a) Borrower’s Consolidated financial condition, (b) Borrower’s Consolidated operations, properties or prospects, considered as a whole, (c) Borrower’s ability to timely pay its Obligations, or (d) the enforceability of the material terms of any Loan Document.
“Matured LC Obligations” means all amounts paid by LC Issuer on drafts or demands for payment drawn or made under or purported to be under any Letter of Credit and all other amounts due and owing to LC Issuer under any LC Application for any such Letter of Credit, to the extent the same have not been repaid to LC Issuer (with the proceeds of Loans or otherwise).
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“Maturity Date” means the Settlement Date occurring in the month following the Funding Date of the Loans requested in the last Financing Request-Initial accepted by one or more Participating Lenders prior to the Request Period Termination Date.
“Maximum Facility Amount” means $200,000,000, as such Maximum Facility Amount may be increased from time to time pursuant to Section 2.1(e).
“Moody’s” means Moody’s Investor Service, Inc., or its successor.
“Notes” has the meaning given such term in Section 2.2 hereof.
“NYMEX” means the New York Mercantile Exchange.
“Obligations” means all Liabilities from time to time owing by Borrower to any Lender Party under or pursuant to any of the Notes and Letters of Credit, including all LC Obligations owing thereunder, or under or pursuant to any guaranty of the obligations of Borrower or under the Loan Documents. “Obligation” means any part of the Obligations.
“PAA” means Plains All American Pipeline, L.P., a Delaware limited partnership.
“PAA Credit Agreement” means that certain Credit Agreement [US/Canada Facilities] of even date herewith among PAA, PMC (Nova Scotia) Company, Plains Marketing Canada, L.P., Fleet National Bank, as administrative agent, The Bank of Nova Scotia, as Canadian administrative agent, and the lenders named therein.
“PAA Debt Rating” means the rating then in effect by a Rating Agency with respect to the long term senior unsecured non-credit enhanced debt of PAA.
“Participating Lender” has the meaning given to such term in Section 2.1(b).
“Percentage Share” means (a) when used in Sections 2.1, 2.2 or 2.6 or in any Borrowing Notice with respect to a Participating Lender, the percentage set forth opposite such Participating Lender’s name on the Lender Schedule hereto, (b) when no Letters of Credit or Loans are outstanding hereunder and no Lender has any outstanding commitment to participate in any Letters of Credit or Loans, with respect to each Lender, the percentage set forth opposite such Lender’s name on the Lender Schedule hereto, and (c) when used otherwise, with respect to each Lender, the percentage obtained by dividing (i) the sum of the unpaid principal balance of such Lender’s Loans at the time in question plus such Lender’s LC Obligations plus such Lender’s Percentage Share of any Letters of Credit or Loans which such Lender has committed to participate in pursuant to Section 2.1, by (ii) the sum of the aggregate unpaid principal balance of all Loans at such time plus the aggregate amount of LC Obligations outstanding at such time plus the aggregate amount of Letters of Credit and Loans which one or more Lenders have committed to participate in pursuant to Section 2.1.
“Permitted Inventory Liens” means (i) any Lien, and the amount of any Liability secured thereby, on Petroleum Products inventory imposed by any governmental authority for taxes,
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assessments or charges not yet due or the validity of which is being contested in good faith and by appropriate proceedings, if necessary, for which adequate reserves are maintained on the books of Borrower in accordance with GAAP (so long as such Lien is inchoate) or (ii) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlord’s, or other like Liens (including, without limitation, Liens on property of Borrower in the possession of storage facilities, pipelines or barges) arising in the ordinary course of business for amounts which are not more than 60 days past due or the validity of which is being contested in good faith and by appropriate proceedings, if necessary, and for which adequate reserves are maintained on the books of Borrower in accordance with GAAP.
“Person” means an individual, corporation, partnership, limited liability company, association, joint stock company, trust or trustee thereof, estate or executor thereof, unincorporated organization or joint venture, Tribunal, or any other legally recognizable entity.
“Petroleum Products” means crude oil, condensate, natural gas, natural gas liquids (NGL’s), liquefied petroleum gases (LPG’s), refined petroleum products or any blend thereof.
“Plains Terminal” means any storage terminal, tankage or facility owned by Borrower or by any Affiliate of Borrower that has executed and delivered a bailee letter in form and substance reasonably acceptable to Administrative Agent with respect to any Collateral stored at such terminal, tankage or facility.
“Pricing Grid” means Schedule 3 attached hereto.
“Rating Agency” means either S&P or Moody’s.
“Regulation D” means Regulation D of the Board of Governors of the Federal Reserve System as from time to time in effect.
“Request Period” means the period from and including the date hereof until the Request Period Termination Date (or, if earlier, the day on which any commitment of any Lender to make Loans or participate in Letters of Credit, and the obligation of LC Issuer to issue such Letters of Credit, has been terminated, or the day on which any of the Notes first becomes due and payable in full).
“Request Period Termination Date” means November 21, 2004, as such date may be extended pursuant to Section 2.9.
“Restriction Exception” means (i) any applicable Law or any instrument governing Indebtedness or equity interests, or any applicable Law or any other agreement relating to any property, assets or operations of a Person whose capital stock or other equity interests are acquired, in whole or part, by Borrower pursuant to an acquisition (whether by merger, consolidation, amalgamation or otherwise), as such instrument or agreement is in effect at the time of such acquisition (except with respect to Indebtedness incurred in connection with, or in contemplation of, such acquisition), or such applicable Law is then or thereafter in effect (as applicable), which is not applicable to Borrower, or the property, assets or operations of
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Borrower, other than the acquired Person, or the property, assets or operations of such acquired Person or such acquired Person’s Subsidiaries; provided that in the case of Indebtedness, the incurrence of such Indebtedness is not prohibited hereunder, or (ii) provisions with respect to the disposition or distribution of assets in joint venture agreements or other similar agreements entered into in the ordinary course of business.
“S&P” means Standard & Poor’s Ratings Group (a division of McGraw Hill, Inc.) or its successor.
“Sale/Storage Month” has the meaning given to such term in Section 2.1(a).
“Sale Value” means, as to Hedged Eligible Inventory specified in a Financing Request-Final and the corresponding sales contracts with respect thereto, an amount equal to the volumes of such Hedged Eligible Inventory times the sale price (or the Hedged Value of stored Hedged Eligible Inventory not subject to sales contracts) with respect to which Lenders are financing the Cash and Carry Purchase (or refinancing the storage) thereof, minus all related storage, transportation and other applicable costs, as set forth therein.
“Security Documents” means the instruments listed in the Security Schedule and all other security agreements, chattel mortgages, pledges, financing statements, continuation statements, extension agreements and other agreements or instruments now, heretofore, or hereafter delivered by Borrower to Administrative Agent in connection with this Agreement or any transaction contemplated hereby to secure or guarantee the payment of any part of the Obligations or the performance of Borrower’s other duties and obligations under the Loan Documents.
“Security Schedule” means Schedule 3 hereto.
“Settlement Date” means the US crude oil monthly settlement date, occurring on or about the 20th day of each month.
“Subsidiary” means, with respect to any Person, any corporation, association, partnership, limited liability company, joint venture, or other business or corporate entity, enterprise or organization which is directly or indirectly (through one or more intermediaries) controlled or owned more than fifty percent by such Person.
“Termination Event” means (a) the occurrence with respect to any ERISA Plan of (i) a reportable event described in Sections 4043(c)(5) or (6) of ERISA or (ii) any other reportable event described in Section 4043(c) of ERISA other than a reportable event not subject to the provision for 30-day notice to the Pension Benefit Guaranty Corporation pursuant to a waiver by such corporation under Section 4043(a) of ERISA, or (b) the withdrawal of any ERISA Affiliate from an ERISA Plan during a plan year in which it was a “substantial employer” as defined in Section 4001(a)(2) of ERISA, or (c) the filing of a notice of intent to terminate any ERISA Plan or the treatment of any ERISA Plan amendment as a termination under Section 4041 of ERISA, or (d) the institution of proceedings to terminate any ERISA Plan by the Pension Benefit Guaranty Corporation under Section 4042 of ERISA, or (e) any other event or condition which
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might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any ERISA Plan.
“Tribunal” means any government, any arbitration panel, any court or any governmental department, commission, board, bureau, agency or instrumentality of the United States of America, the Dominion of Canada, or any state, province, commonwealth, nation, territory, possession, county, parish, town, township, village or municipality, whether now or hereafter constituted or existing.
“Type” means, with respect to any Loans, the characterization of such Loans as Base Rate Loans or LIBOR Loans.
“UCC” means the Uniform Commercial Code as in effect in the State of New York.
Section 1.2. Exhibits and Schedules; Additional Definitions. All Exhibits and Schedules attached to this Agreement are a part hereof for all purposes.
Section 1.3. Amendment of Defined Instruments. Unless the context otherwise requires or unless otherwise provided herein the terms defined in this Agreement which refer to a particular agreement, instrument or document also refer to and include all renewals, extensions, modifications, amendments and restatements of such agreement, instrument or document, provided that nothing contained in this section shall be construed to authorize any such renewal, extension, modification, amendment or restatement.
Section 1.4. References and Titles. All references in this Agreement to Exhibits, Schedules, articles, sections, subsections and other subdivisions refer to the Exhibits, Schedules, articles, sections, subsections and other subdivisions of this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any subdivisions are for convenience only and do not constitute any part of such subdivisions and shall be disregarded in construing the language contained in such subdivisions. The words “this Agreement,” “this instrument,” “herein,” “hereof,” “hereby,” “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. The phrases “this section” and “this subsection” and similar phrases refer only to the sections or subsections hereof in which such phrases occur. The word “or” is not exclusive, and the word “including” (in its various forms) means “including without limitation.” Pronouns in masculine, feminine and neuter genders shall be construed to include any other gender, and words in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. References to an “officer” or “officers” of Borrower shall mean and include officers of such Person or the controlling management entity of such Person as provided in such Person’s organizational documents, as applicable.
Section 1.5. Calculations and Determinations. All calculations under the Loan Documents of interest chargeable with respect to LIBOR Loans and of fees shall be made on the basis of actual days elapsed (including the first day but excluding the last) and a year of 360 days. All other calculations of interest made under the Loan Documents shall be made on the basis of actual days elapsed (including the first day but excluding the last) and a year of 365 or 366 days,
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as appropriate. Each determination by a Lender Party of amounts to be paid under Article III or any other matters which are to be determined hereunder by a Lender Party (such as any LIBOR Rate, Business Day, Interest Period, or Reserve Percentage) shall, in the absence of manifest error, be conclusive and binding. Unless otherwise expressly provided herein or unless Majority Lenders otherwise consent all financial statements and reports furnished to any Lender Party hereunder shall be prepared and all financial computations and determinations pursuant hereto shall be made in accordance with GAAP.
ARTICLE II - Loans and Letters of Credit
Section 2.1. Financing Requests, Commitments and Fundings.
(a) Borrower Financing Requests. During the Request Period, Borrower may, not later than 12:00 noon, Eastern time on the third Business Day prior to the end of each calendar month, submit to Lenders a Financing Request-Initial in the form of Exhibit B-1 (i) specifying volumes of Hedged Eligible Inventory to be subject to Cash and Carry Purchases in the month (the “Delivery Month”) following the month Borrower submits such corresponding Financing Request-Initial, or stored at and to remain stored at Approved Locations during the Delivery Month, including hedged price, Hedged Value and Approved Locations where such Hedged Eligible Inventory is to be delivered and/or stored during the Delivery Month, (ii) specifying the Hedging Contracts (including Master ISDA Agreements, counterparties and confirmations thereunder) covering such Hedged Eligible Inventory, and (iii) to the extent available, listing any corresponding sale contracts (with purchaser, date, volumes, prices, delivery dates and such other identifying information as Administrative Agent may reasonably request) pursuant to which Borrower has contracted to sell such Hedged Eligible Inventory, or otherwise specifying the Approved Locations where such Hedged Eligible Inventory is to be sold from and/or stored in the month following the Delivery Month (the “Sale/Storage Month”). Pursuant to such Financing Request-Initial, Borrower may request Lenders to commit to make pro rata advances on the Settlement Date for the Delivery Month (the “Funding Date”) of up to 90% of the lesser of (x) the Sale Value of such Hedged Eligible Inventory and (y) 110% of the Hedged Value of such Hedged Eligible Inventory, to fund the purchase of such Hedged Eligible Inventory or to refinance such stored Hedged Eligible Inventory, which commitment shall include Lenders’ participation on a pro rata basis in letters of credit, in an amount not to exceed 90% of the Hedged Value of such Hedged Eligible Inventory, to secure the purchase of such Hedged Eligible Inventory, if Borrower shall at its sole option so elect prior to such Funding Date.
(b) Lender Evaluation of Financing Requests-Initial. Each Lender shall independently evaluate each Financing Request-Initial and related contracts and shall determine, in its sole and absolute discretion, whether or not it desires to commit to such requested financing. Each Lender shall notify Agent by 12:00 noon, Eastern time on the second Business Day following such Financing Request-Initial as to whether or not such Lender is willing to commit to such requested financing, and Agent shall promptly thereafter notify Borrower of each Lender’s response with respect to Borrower’s Financing Request-Initial.
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No Lender shall have any commitment or obligation to commit to any requested financing, participate in any Letter of Credit and/or make any Loan hereunder unless and until such Lender affirmatively commits to such requested financing. Nothing contained herein shall otherwise commit or obligate any Lender, or be interpreted as a promise or commitment by any Lender to make or elect to make any such Loan or participate or elect to participate in any such Letter of Credit.
Once a Lender affirmatively commits to a requested financing (a “Participating Lender”), such commitment shall be binding on such Participating Lender with respect to, but only with respect to, such requested financing, and shall not bind such Participating Lender to participate in any subsequent requested financing. Furthermore, notwithstanding a Participating Lender’s commitment to a requested financing, such Participating Lender shall have no commitment or obligation to participate in such requested financing in an amount in excess of its Percentage Share of such requested financing or in an amount that would cause such Lender’s outstanding Loans and Percentage Share of LC Obligations to exceed such Lender’s Percentage Share of the Maximum Facility Amount. At Borrower’s election, Borrower may subsequently request Participating Lenders with respect to any Financing Request-Initial to increase their commitments with respect to such Financing Request-Initial in an amount not to exceed the aggregate Percentage Share of any Lenders declining to participate in such Financing Request-Initial. No Participating Lender shall have any commitment or obligation to participate in such requested increase. In the event a Participating Lender affirmatively commits to any such requested increase, such Participating Lender’s corresponding commitments to participate in Letters of Credit and Loans with respect thereto pursuant to Section 2.1(c) and 2.1(d) shall be increased accordingly.
(c) Letters of Credit Securing LC-Backed Purchase Contracts. With respect to a Financing Request-Initial, if one or more Participating Lenders shall have committed to participate in the requested financing, the LC Issuer shall, at Borrower’s request prior to the applicable Funding Date, issue one or more Letters of Credit pursuant to Section 2.10, naming the sellers of such Hedged Eligible Inventory under such purchase contracts as Borrower may specify (“LC-Backed Purchase Contracts”), as beneficiaries, in an amount equal to the aggregate Percentage Share of Participating Lenders times the requested face amount of such Letters of Credit; provided, Borrower shall specify to Administrative Agent the seller, date, volumes, prices, delivery dates and such other identifying information as Administrative Agent may reasonably request with respect to each such LC-Backed Purchase Contract. Each such Letter of Credit shall by its terms identify the specific LC-Backed Purchase Contracts to which it relates and shall automatically reduce upon receipt by the beneficiary thereof of any payments made by Borrower to such beneficiary for such Hedged Eligible Inventory referencing such Letter of Credit.
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(d) Loans to Finance Cash and Carry Purchases/Storage of Hedged Eligible Inventory. With respect to a Financing Request-Initial, if one or more Participating Lenders shall have committed to finance Cash and Carry Purchases of Hedged Eligible Inventory (or refinance the storage of Hedged Eligible Inventory), Borrower shall, prior to the end of the applicable Delivery Month, submit to Lenders a Financing Request-Final in the form of Exhibit B-2 with respect to such Hedged Eligible Inventory pursuant to Section 2.3(a) listing the corresponding sale contracts (with purchaser, date, volumes, prices, delivery dates and such other identifying information as Administrative Agent may reasonably request) pursuant to which Borrower will sell such Hedged Eligible Inventory during the applicable Sale/Storage Month, including specifying volumes, sale price and Sale Value, or (b) Approved Locations where such Hedged Eligible Inventory is to be stored during the applicable Sale/Storage Month, with volumes, hedged price and Hedged Value. On the applicable Funding Date, each Participating Lender shall make its Loan pursuant to Section 2.2, net of any prior Loans by such Participating Lender due and payable on such Funding Date, and Administrative Agent shall (i) net against such aggregate Loans the aggregate amount of any other Loans due and payable on such Funding Date, (ii) repay such matured Loans to the Lenders thereof and (iii) make the balance available to Borrower pursuant to Section 2.3.
(e) Increase of Maximum Facility Amount. Borrower shall have the right, without the consent of the Lenders but with the prior approval of the Administrative Agent, not to be unreasonably withheld, to cause from time to time an increase in the Maximum Facility Amount by adding to this Agreement one or more additional Lenders or by allowing one or more Lenders to increase their portion of the Maximum Facility Amount; provided however (i) no Event of Default shall have occurred hereunder which is continuing, (ii) no such increase shall result in the Maximum Facility Amount to exceed $300,000,000, and (iii) no Lender’s portion of the Maximum Facility Amount shall be increased without such Lender’s consent.
Section 2.2. Loans and Notes. Subject to the terms and conditions hereof, each Participating Lender with respect to a Financing Request-Initial and corresponding Financing Request-Final and Borrowing Notice agrees to make a Loan to Borrower on the Funding Date corresponding thereto in an amount equal to such Participating Lender’s Percentage Share of the lesser of (x) 90% of the Sale Value and (y) 110% of the Hedged Value of the Hedged Eligible Inventory described therein; provided that (a) subject to Sections 3.3, 3.4 and 3.6, all such Participating Lenders are requested to make Loans of the same Type in accordance with their respective Percentage Shares and as part of the same Borrowing, (b) after giving effect to such Loans (and the repayment of any outstanding Loans on such date pursuant to netting with respect thereto as set forth in the last sentence of Section 2.1(d)), the Facility Usage does not exceed the Maximum Facility Amount determined as of the date on which the requested Loans are to be made, and (c) after giving effect to such Loans (and the repayment of any outstanding Loans on such date pursuant to netting with respect thereto as set forth in the last sentence of Section 2.1(d)), the Loans by such Participating Lender plus the existing LC Obligations of such Participating Lender with respect to Letters of Credit do not exceed such Lender’s Percentage Share of the Maximum Facility Amount. The aggregate amount of all Loans in any Borrowing must be equal to $2,000,000 or any higher integral multiple of $250,000. The obligation of Borrower to repay to each Lender the aggregate amount of all Loans made by such Lender to Borrower, together with interest accruing in connection therewith, shall be evidenced by a single
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promissory note (herein called such Lender’s “Note”) made by Borrower payable to the order of such Lender in the form of Exhibit A with appropriate insertions. The amount of principal owing on any Lender’s Note at any given time shall be the aggregate amount of all Loans theretofore made by such Lender to Borrower minus all payments of principal theretofore received by such Lender on such Note. Interest on each Note shall accrue and be due and payable as provided herein and therein. Each Note shall be due and payable as provided herein and therein, and shall be due and payable in full on the Maturity Date. Subject to the terms and conditions of this Agreement, Borrower may borrow, repay, and reborrow under this Section 2.2. Borrower may have no more than seven Borrowings of LIBOR Loans outstanding at any time. All payments of principal and interest on the Loans shall be made in Dollars.
Section 2.3. Requests for Loans. Borrower must give to Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of any requested Borrowing. Each such notice constitutes a “Borrowing Notice” hereunder and must:
(a) specify the corresponding Financing Request-Final, each Participating Lender therein, and (A) the aggregate amount of any such Borrowing and the Funding Date on which Base Rate Loans are to be advanced, or (B) the aggregate amount of any such Borrowing of new LIBOR Loans, the Funding Date on which such LIBOR Loans are to be advanced (which shall be the first day of the Interest Period which is to apply thereto), and the length of the applicable Interest Period; and
(b) be received by Administrative Agent not later than 11:00 a.m., Boston, Massachusetts time, on (i) the day on which any such Base Rate Loans are to be made, or (ii) the third Business Day preceding the day on which any such LIBOR Loans are to be made.
Each such written request or confirmation must be made in the form and substance of the “Borrowing Notice” attached hereto as Exhibit B-3, duly completed. Each such telephonic request shall be deemed a representation, warranty, acknowledgment and agreement by Borrower as to the matters which are required to be set out in such written confirmation. Upon receipt of any such Borrowing Notice, Administrative Agent shall give each Lender prompt notice of the terms thereof. If all conditions precedent to such new Loans have been met, each Participating Lender therein will on the Funding Date promptly remit to Administrative Agent at its office in Boston, Massachusetts the amount of such Participating Lender’s new Loan in immediately available funds, and upon receipt of such funds, unless to its actual knowledge any conditions precedent to such Loans have been neither met nor waived as provided herein, Administrative Agent shall promptly make such Loans available to Borrower. Unless Administrative Agent shall have received prompt notice from a Participating Lender that such Participating Lender will not make available to Borrower such Lender’s new Loan, Administrative Agent may in its discretion assume that such Participating Lender has made such Loan available to Administrative Agent in accordance with this section, and Administrative Agent may if it chooses, in reliance upon such assumption, make such Loan available to Borrower. If and to the extent such Participating Lender shall not so make its new Loan available to Administrative Agent, such Participating Lender and Borrower severally agree to pay or repay to Administrative Agent within three days after demand the amount of such Loan together with interest thereon, for each
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day from the date such amount was made available to Borrower until the date such amount is paid or repaid to Administrative Agent, with interest at (i) the Federal Funds Rate, if such Participating Lender is making such payment, and (ii) the interest rate applicable at the time to the other new Loans made on such date, if Borrower is making such repayment. If neither such Participating Lender nor Borrower pays or repays to Administrative Agent such amount within such three-day period, Administrative Agent shall be entitled to recover from Borrower, on demand in lieu of the interest provided for in the preceding sentence, interest thereon at the Default Rate, calculated from the date such amount was made available to Borrower. The failure of any Participating Lender to make any new Loan to be made by it hereunder shall not relieve any other Participating Lender of its obligation hereunder, if any, to make its new Loan, but no Participating Lender shall be responsible for the failure of any other Participating Lender to make any new Loan to be made by such other Participating Lender. All Borrowings of Loans shall be advanced in Dollars.
Section 2.4. Continuations and Conversions of Existing Loans. Borrower may make the following elections with respect to Loans already outstanding: (i) to Convert, in whole or in part, Base Rate Loans to LIBOR Loans, (ii) to Convert, in whole or in part, LIBOR Loans to Base Rate Loans on the last day of the Interest Period applicable thereto, and (iii) to Continue, in whole or in part, LIBOR Loans beyond the expiration of such Interest Period by designating a new Interest Period to take effect at the time of such expiration. In making such elections, Borrower may combine existing Loans to Borrower made pursuant to separate Borrowings into one new Borrowing or divide existing Loans to Borrower made pursuant to one Borrowing into separate new Borrowings, provided that Borrower may have no more than seven Borrowings of LIBOR Loans outstanding at any time. To make any such election, Borrower must give to Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of any such Conversion or Continuation of existing Loans, with a separate notice given for each new Borrowing. Each such notice constitutes a “Continuation/Conversion Notice” hereunder and must:
(i) specify the existing Loans which are to be Continued or Converted;
(ii) specify (A) the aggregate amount of any Borrowing of Base Rate Loans into which such existing Loans are to be Continued or Converted and the date on which such Continuation or Conversion is to occur, or (B) the aggregate amount of any Borrowing of LIBOR Loans into which such existing Loans are to be Continued or Converted, the date on which such Continuation or Conversion is to occur (which shall be the first day of the Interest Period which is to apply to such LIBOR Loans), and the length of the applicable Interest Period; and
(iii) be received by Administrative Agent not later than 11:00 a.m. Boston, Massachusetts time, on (i) the day on which any such Continuation or Conversion to Base Rate Loans is to occur, or (ii) the third Business Day preceding the day on which any such Continuation or Conversion to LIBOR Loans is to occur.
Each such written request or confirmation must be made in the form and substance of the “Continuation/Conversion Notice” attached hereto as Exhibit C, duly completed. Each such
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telephonic request shall be deemed a representation, warranty, acknowledgment and agreement by Borrower as to the matters which are required to be set out in such written confirmation. Upon receipt of any such Continuation/Conversion Notice, Administrative Agent shall give each Lender prompt notice of the terms thereof. Each Continuation/Conversion Notice shall be irrevocable and binding on Borrower. During the continuance of any Default, Borrower may not make any election to Convert existing Loans into LIBOR Loans or Continue existing Loans as LIBOR Loans beyond the expiration of their respective and corresponding Interest Period then in effect. If (due to the existence of a Default or for any other reason) Borrower fails to timely and properly give any Continuation/Conversion Notice with respect to a Borrowing of existing LIBOR Loans at least three days prior to the end of the Interest Period applicable to such LIBOR Loans, any such LIBOR Loans, to the extent not prepaid at the end of such Interest Period, shall automatically be Converted into Base Rate Loans at the end of such Interest Period. No new funds shall be repaid by Borrower or advanced by any Lender in connection with any Continuation or Conversion of existing Loans pursuant to this section, and no such Continuation or Conversion shall be deemed to be a new advance of funds for any purpose; such Continuations and Conversions merely constitute a change in the interest rate applicable to such already outstanding Loans.
Section 2.5. Use of Proceeds. Borrower shall use all Loans to finance Cash and Carry Purchases of Hedged Eligible Inventory and to refinance Matured LC Obligations. Any Loans used to purchase Hedged Eligible Inventory under LC-Backed Purchase Contracts shall be used by Borrower on the Funding Date to pay the sellers thereunder, with reference in each case to the outstanding Letter of Credit issued with respect to such LC-Backed Purchase Contract, and Borrower shall provide documentation to Administrative Agent with respect thereto. Borrower shall use all Letters of Credit solely for the purposes set forth in Section 2.10(d). In no event shall the funds from any Loans or any Letters of Credit be used directly or indirectly by any Person for personal, family, household or agricultural purposes or for the purpose, whether immediate, incidental or ultimate, of purchasing, acquiring or carrying any “margin stock” (as such term is defined in Regulation U promulgated by the Board of Governors of the Federal Reserve System) or to extend credit to others directly or indirectly for the purpose of purchasing or carrying any such margin stock. Borrower represents and warrants that it is not engaged principally, or as one of its important activities, in the business of extending credit to others for the purpose of purchasing or carrying such margin stock.
Section 2.6. Interest Rates and Fees.
(a) Interest Rates.
(i) Each Loan shall bear interest as follows: (A) unless the Default Rate shall apply, each Base Rate Loan shall bear interest on each day outstanding at the Base Rate plus the Applicable Margin in effect on such day, and each LIBOR Loan shall bear interest on each day during the related Interest Period at the related LIBOR Rate plus the Applicable Margin in effect on such day, and (B) during a Default Rate Period, all Loans shall bear interest on each day outstanding at the applicable Default Rate.
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(ii) If an Event of Default based upon Section 8.1(a), Section 8.1(b) or Section 8.1(h)(i), (h)(ii) or (h)(iii) exists and the Loans are not bearing interest at the Default Rate, the past due principal and past due interest shall bear interest on each day outstanding at the applicable Default Rate.
(iii) The interest rate shall change whenever the applicable Base Rate, LIBOR Rate or Applicable Margin changes. In no event shall the interest rate on any Loan exceed the Highest Lawful Rate.
(b) Facility Fee. In consideration of Lenders’ agreement to consider financing requests of Borrower hereunder, Borrower agrees to pay to Administrative Agent for the account of each Lender in proportion to its Percentage Share, a facility fee equal to one-twentieth percent (0.05%) of the Maximum Facility Amount, due and payable on the date hereof.
(c) Administrative Agent’s Fees. In addition to all other amounts due to Administrative Agent under the Loan Documents, Borrower will pay fees to Administrative Agent as described in the fee letter dated October 20, 2003 between Administrative Agent and Borrower.
Section 2.7. Optional Prepayments. Borrower may, upon three Business Days’ notice, as to LIBOR Loans, or same Business Day’s notice, as to Base Rate Loans, to Administrative Agent (and Administrative Agent will promptly give notice to the other Lenders) from time to time and without premium or penalty prepay the Loans, in whole or in part, so long as the aggregate amounts of all partial prepayments of principal on the Loans equals $2,500,000 or any higher integral multiple of $250,000. Upon receipt of any such notice, Administrative Agent shall give each Lender prompt notice of the terms thereof. Each prepayment of principal of a Loan under this section shall be accompanied by all interest then accrued and unpaid on the principal so prepaid. Any principal or interest prepaid pursuant to this section shall be in addition to, and not in lieu of, all payments otherwise required to be paid under the Loan Documents at the time of such prepayment. Following notice by Borrower pursuant to the foregoing, Borrower shall make such prepayment, and the prepayment amount specified in such notice shall be due and payable, on the date specified in such notice.
Section 2.8. Mandatory Prepayments and Payments.
(a) If at any time the Facility Usage exceeds the Maximum Facility Amount, Borrower shall immediately upon demand prepay the principal of the Loans in an amount at least equal to such excess. Each prepayment of principal under this section shall be accompanied by all interest then accrued and unpaid on the principal so prepaid. Any principal or interest prepaid pursuant to this section shall be in addition to, and not in lieu of, all payments otherwise required to be paid under the Loan Documents at the time of such prepayment.
(b) If any contract pursuant to which the Sale Value of any Hedged Eligible Inventory is modified, sold or exchanged in any way that would negatively affect the Sale Value of such Hedged Eligible Inventory following the delivery of the Financing Request-Final with respect thereto, Borrower shall immediately (i) notify Administrative Agent of such decreased Sale Value, and the Financing Request-Final shall be deemed supplemented thereby, and (ii) prepay
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any outstanding Loans with respect to such Hedged Eligible Inventory in an amount equal to 90% of such decrease in Sale Value.
(c) Each Loan by a Participating Lender hereunder shall constitute a term loan due and payable on the Settlement Date occurring in the month next following the month in which such Loan was funded, accompanied by all interest then accrued and unpaid on such Loan.
(d) On the Request Period Termination Date (i) any outstanding Letters of Credit shall continue to be outstanding according to their terms until their expiration or retirement/cancellation pursuant to a related Loan as set forth herein, (ii) any outstanding Loans shall be due and payable as set forth in Section 2.8(c) above, and (iii) any commitments to participate in Letters of Credit or make Loans for Cash and Carry Purchases of Hedged Eligible Inventory, and any Letters of Credit issued or Loans made thereafter pursuant thereto, shall remain outstanding as set forth herein; provided, all such commitments, Letters of Credit and Loans shall be terminated, cancelled or paid in full on or before the Maturity Date.
Section 2.9. Extension of Request Period.
(a) Borrower may, at its option and from time to time during the Request Period, request that Lenders extend the Request Period Termination Date by delivering to Administrative Agent a written request made by Borrower to each Lender to extend the Request Period Termination Date for an additional year not more than forty-five days and not less than thirty days prior to the then current Request Period Termination Date. Administrative Agent shall forthwith provide a copy of the request to each Lender. Upon receipt from Administrative Agent of such request, each Lender shall, within fifteen days after the date of such Lender’s receipt of such request from Administrative Agent, notify Administrative Agent of its acceptance (and the terms and conditions, if any, upon which such Lender is prepared to extend the Request Period Termination Date) or rejection of such request. The failure of a Lender to so notify Administrative Agent within such twenty day period shall be deemed to be notification by such Lender to Administrative Agent that such Lender has denied such request.
(b) Following any Lender’s or Lenders’ notice to Administrative Agent pursuant to Section 2.9(a) that such Lender or Lenders accept such request, such acceptance having common terms and conditions, Administrative Agent shall deliver to Borrower such offer incorporating the said terms and conditions. Such offer shall be open for acceptance by Borrower until the fifth Business Day immediately preceding the then current Request Period Termination Date. Upon written notice by Borrower to Administrative Agent accepting such offer and agreeing to the terms and conditions, if any, specified therein (the date of such notice of acceptance being called the “Extension Date”), the Request Period Termination Date shall be extended to the date one year from the Extension Date and the terms and conditions specified in such offer shall be immediately effective.
(c) Upon Borrower’s acceptance of Lenders’ offer to extend the Request Period Termination Date, any Lender that rejected Borrower’s extension request shall have no obligation to evaluate any Financing Request-Initial received on or after the Extension Date, but any such Lender that is a Participating Lender with respect to any previously approved Financing Request-
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Initial shall be obligated to participate in Letters of Credit issued after the Extension Date pursuant to such approved Financing Request-Initial and/or make Loans after the Extension Date pursuant to such approved Financing Request-Initial.
(d) Borrower understands that the consideration of any request constitutes an independent credit decision which each Lender retains the absolute and unfettered discretion to make and that no commitment in this regard is hereby given by a Lender and that any offer to extend the Request Period Termination Date may be on such terms and conditions in addition to those set out herein as the extending Lenders stipulate.
Section 2.10. Letters of Credit. Subject to the terms and conditions hereof, Borrower may request LC Issuer to issue any Letter of Credit that Participating Lenders have agreed to participate in pursuant to and subject to the terms of Section 2.1(c) (or amend, or extend the expiration date of, one or more such Letters of Credit), provided that, after taking such Letter of Credit (or amendment or extension) into account:
(a) the Facility Usage does not exceed the Maximum Facility Amount;
(b) the face amount of such Letter of Credit does not exceed the aggregate Percentage Share of Participating Lenders with respect to such Letter of Credit times ninety percent (90%) of the Hedged Value of the Hedged Eligible Inventory subject to the Cash and Carry Purchase thereof pursuant to the LC-Backed Purchase Contract secured by such Letter of Credit;
(c) the expiration date of such Letter of Credit is prior to 70 days after the date of issuance of such Letter of Credit;
(d) such Letter of Credit is used to secure the Cash and Carry Purchase by Borrower of Hedged Eligible Inventory pursuant to an LC-Backed Purchase Contract and is substantially in the form of Exhibit E hereto or such other form and terms as shall be acceptable to LC Issuer in its sole and absolute discretion;
(e) the issuance of such Letter of Credit will be in compliance with all applicable governmental restrictions, policies, and guidelines and will not subject LC Issuer to any cost which is not reimbursable under Article III; and
(f) all other conditions in this Agreement to the issuance of such Letter of Credit have been satisfied.
LC Issuer will honor any such request if the foregoing conditions (a) through (f) (in the following Section 2.11 called the “LC Conditions”) have been met as of the date of issuance, amendment, or extension of the expiration, of such Letter of Credit. Letters of Credit shall be issued in Dollars.
Section 2.11. Requesting Letters of Credit. Borrower must make written application for any Letter of Credit at least two Business Days before the date on which Borrower desires for LC Issuer to issue such Letter of Credit. By making any such written application, unless otherwise
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expressly stated therein, Borrower shall be deemed to have represented and warranted that the LC Conditions described in Section 2.10 will be met as of the date of issuance of such Letter of Credit. Each such written application for a Letter of Credit must be made in writing in the form and substance of Exhibit F, and the terms and provisions of which are hereby incorporated herein by reference (or in such other form as may mutually be agreed upon by LC Issuer and Borrower). If all LC Conditions for a Letter of Credit have been met as described in Section 2.10 on any Business Day before 11:00 a.m. Boston, Massachusetts time, LC Issuer will issue such Letter of Credit on the same Business Day at LC Issuer’s office in Boston, Massachusetts. If the LC Conditions are met as described in Section 2.10 on any Business Day on or after 11:00 a.m. Boston, Massachusetts time, LC Issuer will issue such Letter of Credit on the next succeeding Business Day at LC Issuer’s office in Boston, Massachusetts. If any provisions of any LC Application conflict with any provisions of this Agreement, the provisions of this Agreement shall govern and control.
Section 2.12. Reimbursement and Participations.
(a) Reimbursement by Borrower. Each Matured LC Obligation shall constitute a loan by LC Issuer to Borrower. Borrower promises to pay to LC Issuer, or to LC Issuer’s order, on demand, the full amount of each Matured LC Obligation, together with interest thereon (i) at the Base Rate plus the Applicable Margin to and including the second Business Day after the Matured LC Obligation is incurred and (ii) at the Default Rate on each day thereafter.
(b) Letter of Credit Advances. If the beneficiary of any Letter of Credit makes a draft or other demand for payment thereunder then Borrower may, during the interval between the making thereof and the honoring thereof by LC Issuer, request Lenders to make Loans to Borrower in the amount of such draft or demand, which Loans shall be made concurrently with LC Issuer’s payment of such draft or demand and shall be immediately used by LC Issuer to repay the amount of such resulting Matured LC Obligation. Such a request by Borrower shall be made in compliance with all of the provisions hereof, provided that for the purposes of the first sentence of Section 2.1, the amount of such Loans shall be considered, but the amount of the Matured LC Obligation to be concurrently paid by such Loans shall not be considered.
(c) Participation by Lenders. LC Issuer irrevocably agrees to grant and hereby grants to each Lender, and — to induce LC Issuer to issue Letters of Credit hereunder — each Lender irrevocably agrees to accept and purchase and hereby accepts and purchases from LC Issuer, on the terms and conditions hereinafter stated and for such Lender’s own account and risk an undivided interest equal to such Lender’s Percentage Share of LC Issuer’s obligations and rights under each Letter of Credit issued hereunder and the amount of each Matured LC Obligation paid by LC Issuer thereunder. Each Lender unconditionally and irrevocably agrees with LC Issuer that, if a Matured LC Obligation is paid under any Letter of Credit for which LC Issuer is not reimbursed in full by Borrower in accordance with the terms of this Agreement and the related LC Application (including any reimbursement by means of concurrent Loans or by the application of LC Collateral), such Lender shall (in all circumstances and without set-off or counterclaim) pay to LC Issuer, on demand, in immediately available funds at such LC Issuer’s address for notices hereunder, such Lender’s Percentage Share of such Matured LC Obligation (or any portion thereof which has not been reimbursed by Borrower). Each Lender’s obligation to
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pay LC Issuer pursuant to the terms of this subsection is irrevocable and unconditional. If any amount required to be paid by any Lender to LC Issuer pursuant to this subsection is paid by such Lender to LC Issuer within three Business Days after the date such payment is due, LC Issuer shall in addition to such amount be entitled to recover from such Lender, on demand, interest thereon calculated from such due date at the Federal Funds Rate. If any amount required to be paid by any Lender to LC Issuer pursuant to this subsection is not paid by such Lender to LC Issuer within three Business Days after the date such payment is due, LC Issuer shall in addition to such amount be entitled to recover from such Lender, on demand, interest thereon calculated from such due date at the Base Rate plus the Applicable Margin.
(d) Distributions to Participants. Whenever LC Issuer has in accordance with this section received from any Lender payment of such Lender’s Percentage Share of any Matured LC Obligation, if LC Issuer thereafter receives any payment of such Matured LC Obligation or any payment of interest thereon (whether directly from Borrower or by application of LC Collateral or otherwise, and excluding only interest for any period prior to LC Issuer’s demand that such Lender make such payment of its Percentage Share), LC Issuer will distribute to such Lender its Percentage Share of the amounts so received by LC Issuer; provided, however, that if any such payment received by LC Issuer must thereafter be returned by LC Issuer, such Lender shall return to LC Issuer the portion thereof which LC Issuer has previously distributed to it.
(e) Calculations. A written advice setting forth in reasonable detail the amounts owing under this section, submitted by LC Issuer to the Borrower or any Lender from time to time, shall be conclusive, absent manifest error, as to the amounts thereof.
Section 2.13. Letter of Credit Fees. In consideration of LC Issuer’s issuance of any Letter of Credit, Borrower agrees to pay (i) to Administrative Agent for the account of each Lender in proportion to its Percentage Share, a Letter of Credit fee equal to the Letter of Credit Fee Rate applicable each day times the undrawn face amount of such Letter of Credit and (ii) to LC Issuer for its own account, a letter of credit fronting fee at a rate equal to one-eighth percent (.125%) per annum times the undrawn face amount of such Letter of Credit. Each such fee will be calculated on the undrawn face amount of each Letter of Credit outstanding on each day at the above applicable rates and will be payable quarterly in arrears on the last day of each March, June, September and December. In addition, Borrower will pay to LC Issuer a minimum administrative issuance fee and such other fees and charges customarily charged by LC Issuer in respect of any issuance, amendment or negotiation of any Letter of Credit requested by Borrower in accordance with LC Issuer’s published schedule of such charges effective as of the date of such amendment or negotiation.
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Section 2.14. No Duty to Inquire.
(a) Drafts and Demands. LC Issuer is authorized and instructed to accept and pay drafts and demands for payment under any Letter of Credit without requiring, and without responsibility for, any determination as to the existence of any event giving rise to said draft, either at the time of acceptance or payment or thereafter. LC Issuer is not under any duty to determine the proper identity of anyone presenting such a draft or making such a demand (whether by tested telex or otherwise) as the officer, representative or agent of any beneficiary under any Letter of Credit, and payment by LC Issuer to any such beneficiary when requested by any such purported officer, representative or agent is hereby authorized and approved. Borrower releases each Lender Party from, and agrees to hold each Lender Party harmless and indemnified against, any liability or claim in connection with or arising out of the subject matter of this section, which indemnity shall apply whether or not any such liability or claim is in any way or to any extent caused, in whole or in part, by any negligent act or omission of any kind by any Lender Party, provided only that no Lender Party shall be entitled to indemnification for that portion, if any, of any liability or claim which is proximately caused by its own individual gross negligence or willful misconduct, as determined in a final judgment.
(b) Extension of Maturity. If the maturity of any Letter of Credit is extended by its terms or by Law or governmental action, if any extension of the maturity or time for presentation of drafts or any other modification of the terms of any Letter of Credit is made at the request of Borrower, or if the amount of any Letter of Credit is increased at the request of Borrower, this Agreement shall be binding upon Borrower with respect to such Letter of Credit as so extended, increased or otherwise modified, with respect to drafts and property covered thereby, and with respect to any action taken by LC Issuer, LC Issuer’s correspondents, or any Lender Party in accordance with such extension, increase or other modification.
(c) Transferees of Letters of Credit. If any Letter of Credit provides that it is transferable, LC Issuer shall have no duty to determine the proper identity of anyone appearing as transferee of such Letter of Credit, nor shall LC Issuer be charged with responsibility of any nature or character for the validity or correctness of any transfer or successive transfers, and payment by LC Issuer to any purported transferee or transferees as determined by LC Issuer is hereby authorized and approved, and Borrower releases each Lender Party from, and agrees to hold each Lender Party harmless and indemnified against, any liability or claim in connection with or arising out of the foregoing, which indemnity shall apply whether or not any such liability or claim is in any way or to any extent caused, in whole or in part, by any negligent act or omission of any kind by any Lender Party, provided only that no Lender Party shall be entitled to indemnification for that portion, if any, of any liability or claim which is proximately caused by its own individual gross negligence or willful misconduct, as determined in a final judgment.
Section 2.15. LC Collateral.
(a) LC Obligations in Excess of Maximum Facility Amount. If, after the making of all mandatory prepayments required under Section 2.8, the outstanding LC Obligations will exceed
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the Maximum Facility Amount, Borrower will immediately deposit with LC Issuer an amount equal to such excess. LC Issuer will hold such amount as collateral security for such remaining LC Obligations (all such amounts held as collateral security for LC Obligations being herein collectively called “LC Collateral”) and the other Obligations, respectively, and such collateral may be applied from time to time to any Matured LC Obligations or, if any Event of Default shall then exist, any other Obligations which are due and payable; provided, upon the reduction of such outstanding LC Obligations pursuant to the termination or cancellation of any Letter of Credit with respect thereto, LC Issuer shall release LC Collateral in an amount equal to the amount of such terminated or canceled Letter of Credit, and in the event the LC Obligations shall no longer exceed the Maximum Facility Amount LC Issuer shall release all such LC Collateral. Neither this subsection nor the following subsection shall, however, limit or impair any rights which LC Issuer may have under any other document or agreement relating to any Letter of Credit, LC Collateral or LC Obligations, including any LC Application, or any rights which any Lender Party may have to otherwise apply any payments by Borrower and any LC Collateral under Section 3.1.
(b) Acceleration of LC Obligations. If the Obligations or any part thereof become immediately due and payable pursuant to Section 8.1 then, unless all Lenders otherwise specifically elect to the contrary (which election may thereafter be retracted by any Lender at any time), all LC Obligations shall become immediately due and payable without regard to whether or not actual drawings or payments on the Letters of Credit have occurred, and Borrower shall be obligated to deposit with LC Issuer immediately an amount equal to the aggregate LC Obligations with respect to Letters of Credit which are then outstanding to be held as LC Collateral by LC Issuer as set forth above.
(c) Investment of LC Collateral. Pending application thereof, all LC Collateral shall be invested by LC Issuer in such Cash Equivalents as LC Issuer may choose in its sole discretion. All interest on (and other proceeds of) such Investments shall be reinvested or applied to Matured LC Obligations or the Loans which are due and payable. With respect to any LC Collateral delivered pursuant to clause (b) above, when all Obligations have been satisfied in full, including all LC Obligations, all Letters of Credit have expired or been terminated, and all of Borrower’s reimbursement obligations in connection therewith have been satisfied in full, LC Issuer shall release any remaining LC Collateral. Borrower hereby assigns and grants to LC Issuer for the benefit of Lenders a continuing security interest in all LC Collateral paid by it to LC Issuer, all Investments purchased with such LC Collateral, and all proceeds thereof to secure its Matured LC Obligations and its Obligations under this Agreement, each Note and the other Loan Documents. Borrower further agrees that LC Issuer shall have all of the rights and remedies of a secured party under the Uniform Commercial Code as adopted in the State of New York with respect to such security interest and that an Event of Default under this Agreement shall constitute a default for purposes of such security interest.
(d) Payment of LC Collateral. When Borrower is required to provide LC Collateral for any reason and fails to do so on the day when required, LC Issuer or Administrative Agent may without prior notice to Borrower provide such LC Collateral (whether by transfers from other accounts maintained with LC Issuer or otherwise) using any available funds of Borrower or any other Person also liable to make such payments, and LC Issuer or Administrative Agent will give
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notice thereof to Borrower promptly after such application or transfer. Any such amounts which are required to be provided as LC Collateral and which are not provided on the date required shall be considered past due Obligations owing hereunder, and LC Issuer is hereby authorized to exercise its respective rights to obtain such amounts.
ARTICLE III - Payments to Lenders
Section 3.1. General Procedures. Borrower shall pay all amounts owing with respect to any Obligations (whether for principal, interest, fees, or otherwise) to Administrative Agent for the account of the Lender Party to whom such payment is owed in Dollars, without set-off, deduction or counterclaim (other than netting with respect to Loans being made on a particular date and repayment of prior Loans on such date as set forth in the last sentence of Section 2.1(d), in immediately available funds. Each payment under the Loan Documents must be received by Administrative Agent not later than noon, Boston, Massachusetts time, on the date such payment becomes due and payable. Any payment received by Administrative Agent after such time will be deemed to have been made on the next following Business Day. Should any such payment become due and payable on a day other than a Business Day, the maturity of such payment shall be extended to the next succeeding Business Day, and, in the case of a payment of principal or past due interest, interest shall accrue and be payable thereon for the period of such extension as provided in the Loan Document under which such payment is due. Each payment under a Loan Document to a Lender Party shall be due and payable at the place provided therein and, if no specific place of payment is provided, shall be due and payable at the place of payment of Administrative Agent’s Note.
(a) When Administrative Agent collects or receives money on account of the Obligations, Administrative Agent shall distribute all money so collected or received, and each Lender Party shall apply all such money so distributed, as follows:
(i) first, for the payment of all Obligations which are then due (and if such money is insufficient to pay all such Obligations, first to any reimbursements due Administrative Agent under Section 10.4 and then to the partial payment of all other Obligations then due in proportion to the amounts thereof, or as Lender Parties shall otherwise agree);
(ii) then for the prepayment of amounts owing under the Loan Documents (other than principal on the Notes) if so specified by Borrower;
(iii) then for the prepayment of principal on the Notes, together with accrued and unpaid interest on the principal so prepaid, and then held as LC Collateral pursuant to Section 2.15; and
(iv) last, for the payment or prepayment of any other Obligations.
All payments applied to principal or interest on any Note shall be applied first to any interest then due and payable, then to principal then due and payable, and last to any prepayment of principal and accrued interest thereon in compliance with Sections 2.7 and 2.8, as applicable. All distributions of amounts described in any of subsections (ii), (iii), or (iv) above shall be made by
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Administrative Agent pro rata to each Lender Party then owed Obligations described in such subsection in proportion to all amounts owed to all Lender Parties which are described in such subsection; provided that if any Lender then owes payments to LC Issuer for the purchase of a participation under Section 2.12(c) or to Administrative Agent under Section 9.4, any amounts otherwise distributable under this section to such Lender shall be deemed to belong to LC Issuer or Administrative Agent, respectively, to the extent of such unpaid payments, and Administrative Agent shall apply such amounts to make such unpaid payments rather than distribute such amounts to such Lender.
Section 3.2. Capital Reimbursement. If either (a) the introduction or implementation of or the compliance with or any change in or in the interpretation of any Law, or (b) the introduction or implementation of or the compliance with any request, directive or guideline from any central bank or other governmental authority (whether or not having the force of Law) affects or would affect the amount of capital required or expected to be maintained by any Lender Party or any corporation controlling any Lender Party, then, within five Business Days after demand by such Lender Party, Borrower will pay to Administrative Agent for the benefit of such Lender Party, from time to time as specified by such Lender Party, such additional amount or amounts which such Lender Party shall determine to be appropriate to compensate such Lender Party or any corporation controlling such Lender Party in light of such circumstances, to the extent that such Lender Party reasonably determines that the amount of any such capital would be increased or the rate of return on any such capital would be reduced by or in whole or in part based on the existence of the face amount of such Lender Party’s Loans, Letters of Credit, participations in Letters of Credit or commitments under this Agreement.
Section 3.3. Increased Cost of LIBOR Loans or Letters of Credit. If any applicable Law (whether now in effect or hereinafter enacted or promulgated, including Regulation D) or any interpretation or administration thereof by any governmental authority charged with the interpretation or administration thereof (whether or not having the force of Law):
(a) shall change the basis of taxation of payments to any Lender Party of any principal, interest, or other amounts attributable to any LIBOR Loan or Letter of Credit or otherwise due under this Agreement in respect of any LIBOR Loan or Letter of Credit (other than taxes imposed on, or measured by, the overall net income of such Lender Party or any Applicable Lending Office of such Lender Party by any jurisdiction in which such Lender Party or any such Applicable Lending Office is located); or
(b) shall change, impose, modify, apply or deem applicable any reserve, special deposit or similar requirements in respect of any LIBOR Loan or Letter of Credit (excluding those for which such Lender Party is fully compensated pursuant to adjustments made in the definition of LIBOR Rate) or against assets of, deposits with or for the account of, or credit extended by, such Lender Party; or
(c) shall impose on any Lender Party or the interbank Eurocurrency deposit market any other condition affecting any LIBOR Loan or Letter of Credit, the result of which is to increase the cost to any Lender Party of funding or maintaining any LIBOR Loan or Letter of
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Credit or to reduce the amount of any sum receivable by any Lender Party in respect of any LIBOR Loan or Letter of Credit by an amount deemed by such Lender Party to be material, then such Lender Party shall promptly notify Administrative Agent and Borrower in writing of the happening of such event and of the amount required to compensate such Lender Party for such event (on an after-tax basis, taking into account any taxes on such compensation), whereupon (i) Borrower shall, within five Business Days after demand therefor by such Lender Party, pay such amount to Administrative Agent for the account of such Lender Party and (ii) Borrower may elect, by giving to Administrative Agent and such Lender Party not less than three Business Days’ notice, to Convert all (but not less than all) of any such LIBOR Loans into Base Rate Loans.
Section 3.4. Notice; Change of Applicable Lending Office. A Lender Party shall notify Borrower of any event occurring after the date of this Agreement that will entitle such Lender Party to compensation under Section 3.2, 3.3, or 3.5 hereof as promptly as practicable, but in any event within 180 days, after such Lender Party obtains actual knowledge thereof; provided, that (i) if such Lender Party fails to give such notice within 180 days after it obtains actual knowledge of such an event, such Lender Party shall, with respect to compensation payable pursuant to Section 3.2, 3.3, or 3.5 in respect of any costs resulting from such event, only be entitled to payment under Section 3.2, 3.3, or 3.5 hereof for costs incurred from and after the date 180 days prior to the date that such Lender Party does give such notice and (ii) such Lender Party will designate a different Applicable Lending Office for the Loans affected by such event if such designation will avoid the need for, or reduce the amount of, such compensation and will not, in the sole opinion of such Lender Party, be disadvantageous to such Lender Party, except that such Lender Party shall have no obligation to designate an Applicable Lending Office located in the United States of America. Each Lender Party will furnish to Borrower a certificate setting forth the basis and amount of each request by such Lender Party for compensation under Section 3.2, 3.3, or 3.5 hereof.
Section 3.5. Availability. If (a) any change in applicable Laws, or in the interpretation or administration thereof of or in any jurisdiction whatsoever, domestic or foreign, shall make it unlawful or impracticable for any Lender Party to fund or maintain LIBOR Loans or to issue or participate in Letters of Credit, or shall materially restrict the authority of any Lender Party to purchase or take offshore deposits of dollars (i.e., “Eurodollars”), or (b) any Lender Party determines that matching deposits appropriate to fund or maintain any LIBOR Loan are not available to it, or (c) any Lender Party determines that the formula for calculating the LIBOR Rate does not fairly reflect the cost to such Lender Party of making or maintaining loans based on such rate, with respect to the transactions contemplated hereunder, then, upon notice by such Lender Party to Borrower and Administrative Agent, Borrower’s right to elect LIBOR Loans from such Lender Party (or, if applicable, to obtain Letters of Credit) shall be suspended to the extent and for the duration of such illegality, impracticability or restriction and all LIBOR Loans of such Lender Party which are then outstanding or are then the subject of any Borrowing Notice and which cannot lawfully or practicably be maintained or funded shall immediately become or remain, or shall be funded as, Base Rate Loans of such Lender Party. With respect to any commitment of any Lender hereunder, Borrower agrees to indemnify each Lender Party extending credit pursuant thereto, and hold each such Lender Party harmless against all costs,
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expenses, claims, penalties, liabilities and damages which may result from any such change in Law, interpretation or administration. Such indemnification shall be on an after-tax basis, taking into account any taxes imposed on the amounts paid as indemnity.
Section 3.6. Funding Losses. In addition to its other obligations hereunder, with respect to any commitment of any Lender hereunder, Borrower will indemnify each Lender Party extending credit pursuant thereto against, and reimburse each Lender Party on demand for, any loss or expense incurred or sustained by such Lender Party (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender Party to fund or maintain LIBOR Loans), as a result of (a) any payment or prepayment (whether or not authorized or required hereunder) of all or a portion of a LIBOR Loan on a day other than the day on which the applicable Interest Period ends, (b) any payment or prepayment, whether or not required hereunder, of a Loan made after the delivery, but before the effective date, of a Continuation/Conversion Notice, if such payment or prepayment prevents such Continuation/Conversion Notice from becoming fully effective, (c) the failure of any Loan to be made or of any Continuation/Conversion Notice to become effective due to any condition precedent not being satisfied or due to any other action or inaction of Borrower, or (d) any Conversion (whether or not authorized or required hereunder) of all or any portion of any LIBOR Loan into a Base Rate Loan or into a different LIBOR Loan on a day other than the day on which the applicable Interest Period ends. Such indemnification shall be on an after-tax basis, taking into account any taxes imposed on the amounts paid as indemnity.
Section 3.7. Reimbursable Taxes. With respect to any commitment by any Lender hereunder, Borrower covenants and agrees with each Lender Party extending credit pursuant thereto that:
(a) Borrower will indemnify each such Lender Party against and reimburse each such Lender Party for all present and future stamp and other taxes, duties, levies, imposts, deductions, charges, costs, and withholdings whatsoever imposed, assessed, levied or collected on or in respect of this Agreement, any LIBOR Loans or Letters of Credit (whether or not legally or correctly imposed, assessed, levied or collected), excluding, however, any taxes imposed on or measured by the overall net income of Administrative Agent or such Lender Party or any Applicable Lending Office of such Lender Party by any jurisdiction in which such Lender Party or any such Applicable Lending Office is located (all such non-excluded taxes, levies, costs and charges being collectively called “Reimbursable Taxes” in this section). Such indemnification shall be on an after-tax basis, taking into account any taxes imposed on the amounts paid as indemnity.
(b) All payments on account of the principal of, and interest on, each such Lender Party’s Loans and Note, and all other amounts payable by Borrower to any such Lender Party hereunder, shall be made in full without set-off or counterclaim and shall be made free and clear of and without deductions or withholdings of any nature by reason of any Reimbursable Taxes, all of which will be for the account of Borrower. In the event of Borrower being compelled by Law to make any such deduction or withholding from any payment to any such Lender Party, Borrower shall pay on the due date of such payment, by way of additional interest, such additional amounts as are needed to cause the amount receivable by such Lender Party after such deduction or
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withholding to equal the amount which would have been receivable in the absence of such deduction or withholding. If Borrower should make any deduction or withholding as aforesaid, Borrower shall within 60 days thereafter forward to such Lender Party an official receipt or other official document evidencing payment of such deduction or withholding.
(c) If Borrower is ever required to pay any Reimbursable Tax with respect to any LIBOR Loan, Borrower may elect, by giving to Administrative Agent and such Lender Party not less than three Business Days’ notice, to Convert all (but not less than all) of any such LIBOR Loan into a Base Rate Loan, but such election shall not diminish Borrower’s obligation to pay all Reimbursable Taxes.
(d) Notwithstanding the foregoing provisions of this section, Borrower shall be entitled, to the extent it is required to do so by Law, to deduct or withhold (and not to make any indemnification or reimbursement for) income or other similar taxes imposed by the United States of America (other than any portion thereof attributable to a change in federal income tax Laws effected after the date hereof) from interest, fees or other amounts payable hereunder for the account of such Lender Party, other than such a Lender Party (i) who is a US person for Federal income tax purposes or (ii) who has the Prescribed Forms on file with Administrative Agent (with copies provided to the relevant Borrower) for the applicable year to the extent deduction or withholding of such taxes is not required as a result of the filing of such Prescribed Forms, provided that if Borrower shall so deduct or withhold any such taxes, it shall provide a statement to Administrative Agent and such Lender Party, setting forth the amount of such taxes so deducted or withheld, the applicable rate and any other information or documentation which such Lender Party may reasonably request for assisting such Lender Party to obtain any allowable credits or deductions for the taxes so deducted or withheld in the jurisdiction or jurisdictions in which such Lender Party is subject to tax. As used in this section, “Prescribed Forms” means such duly executed forms or statements, and in such number of copies, which may, from time to time, be prescribed by Law and which, pursuant to applicable provisions of (x) an income tax treaty between the United States and the country of residence of such Lender Party providing the forms or statements, (y) the Code, or (z) any applicable rules or regulations thereunder, permit Borrower to make payments hereunder for the account of such Lender Party free of such deduction or withholding of income or similar taxes.
Section 3.8. Replacement of Lenders. If any Lender Party seeks reimbursement for increased costs under Sections 3.2 through 3.7, then within ninety days thereafter — provided no Event of Default then exists — Borrower shall have the right (unless such Lender Party withdraws its request for additional compensation) to replace such Lender Party by requiring such Lender Party to assign its Loans and Note and its commitments hereunder to an Eligible Transferee reasonably acceptable to Administrative Agent and to Borrower, provided that: (i) all Obligations of Borrower owing to such Lender Party being replaced (including such increased costs and any breakage costs with respect to any outstanding LIBOR Loans, but excluding principal and accrued interest on the Note being assigned) shall be paid in full to such Lender Party concurrently with such assignment, and (ii) the replacement Eligible Transferee shall purchase the Notes being assigned by paying to such Lender Party a price equal to the principal amount thereof plus accrued and unpaid interest. In connection with any such assignment Borrower, Administrative Agent, such Lender Party and the replacement Eligible Transferee
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shall otherwise comply with Section 10.5. Notwithstanding the foregoing rights of Borrower under this section, however, Borrower may not replace any Lender Party which seeks reimbursement for increased costs under Section 3.2 through 3.7 unless Borrower is at the same time replacing all Lender Parties which are then seeking such compensation.
ARTICLE IV - Conditions Precedent to Lending
Section 4.1. Documents to be Delivered. No Lender has any obligation to make its first Loan, and LC Issuer has no obligation to issue the first Letter of Credit, unless Administrative Agent shall have received all of the following, at Administrative Agent’s office in Boston, Massachusetts, duly executed and delivered and in form, substance and date satisfactory to Administrative Agent, each of which was so executed and delivered:
(a) This Agreement and any other document that Lenders are to execute in connection herewith.
(b) Each Note and each Security Document.
(c) Certain certificates including:
(i) An “Omnibus Certificate” of the secretary or assistant secretary and any vice president of Plains Marketing GP Inc., which shall contain the names and signatures of the officers of such company authorized to execute Loan Documents and which shall certify to the truth, correctness and completeness of the following exhibits attached thereto: (1) a copy of resolutions duly adopted by the Board of Directors of such company and in full force and effect at the time this Agreement is entered into, authorizing the execution of this Agreement and the other Loan Documents delivered or to be delivered in connection herewith and the consummation of the transactions contemplated herein and therein, (2) a copy of the charter documents of Borrower and all amendments thereto, certified by the appropriate official of its jurisdiction of organization, and (3) a copy of the agreement of limited partnership of Borrower;
(ii) A certificate of the chief financial officer of Plains Marketing GP Inc., regarding satisfaction of Section 4.2; and
(d) A certificate (or certificates) of the due formation, valid existence and good standing of Borrower in Delaware, issued by the Delaware Secretary of State.
(e) Favorable opinions of Tim Moore, Esq., General Counsel for Borrower, substantially in the form set forth in Exhibit D-1, and Fulbright & Jaworski L.L.P., special Texas and New York counsel to Borrower, substantially in the form set forth in Exhibit D-2.
(f) Financial projections for Borrower through December 2004, in form and substance reasonably satisfactory to Administrative Agent.
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(g) Consolidated financial statements of Borrower and its Subsidiaries as of September 30, 2003, together with a certificate by the chief financial officer of GP Inc. certifying such financial statements.
(h) Administrative Agent shall have received all documents and instruments which Administrative Agent has then requested (including opinions of legal counsel for Borrower and Administrative Agent; corporate documents and records; documents evidencing governmental authorizations, consents, approvals, licenses and exemptions; and certificates of public officials and of officers and representatives of Borrower and other Persons), as to (i) the accuracy and validity of or compliance with all representations, warranties and covenants made by Borrower in this Agreement and the other Loan Documents, (ii) the satisfaction of all conditions contained herein or therein, and (iii) all other matters pertaining hereto and thereto. All such additional documents and instruments shall be satisfactory to Administrative Agent in form and substance.
(i) Payment of all facility, agency and other fees required to be paid to Administrative Agent or Lender pursuant to any Loan Documents or any commitment agreement heretofore entered into.
(j) Evidence of the payment in full of all outstanding Indebtedness under the Existing Agreements, the release of all Liens securing such Indebtedness, and termination of the Existing Agreements.
Section 4.2. Additional Conditions Precedent. No Lender has any obligation to make any Loan (including its first), and LC Issuer has no obligation to issue any Letter of Credit (including its first), unless the following conditions precedent have been satisfied:
(a) All representations and warranties made by Borrower in any Loan Document shall be true on and as of the date of such Loan or the date of issuance of such Letter of Credit as if such representations and warranties had been made as of the date of such Loan or the date of issuance of such Letter of Credit except to the extent that such representation or warranty was made as of a specific date or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date.
(b) No Default or “Default” (as such term is used and defined in the PAA Credit Agreement) shall exist at the date of such Loan or the date of issuance of such Letter of Credit or shall result from such Loan or such issuance of such Letter of Credit.
ARTICLE V - Representations and Warranties
To confirm each Lender’s understanding concerning Borrower and its businesses, properties and obligations, and to induce each Lender to enter into this Agreement, consider financing requests of Borrower hereunder, and in each Lender’s sole and absolute discretion extend credit hereunder, Borrower represents and warrants to each Lender that:
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Section 5.1. No Default No event has occurred and is continuing which constitutes a Default, except as has been waived in accordance with this Agreement.
Section 5.2. Organization and Good Standing. Borrower is duly organized or formed, validly existing and in good standing under the Laws of its jurisdiction of organization or formation, having all requisite corporate or similar powers required to carry on its business and enter into and carry out the transactions contemplated hereby. Borrower is duly qualified, in good standing, and authorized to do business in all other jurisdictions wherein the character of the properties owned or held by it or the nature of the business transacted by it makes such qualification necessary except where the failure to so qualify would not reasonably be expected to cause a Material Adverse Change.
Section 5.3. Authorization. Borrower has duly taken all action necessary to authorize the execution and delivery by it of the Loan Documents and to authorize the consummation of the transactions contemplated thereby and the performance of its obligations thereunder. Borrower is duly authorized to borrow funds hereunder.
Section 5.4. No Conflicts or Consents. The execution and delivery by Borrower of the Loan Documents, the performance by it of its obligations, and the consummation of the transactions contemplated thereby, do not and will not (i) violate any provision of (1) Law applicable to it, (2) its organizational documents or (3) any judgment, order or material license or permit applicable to or binding upon it, (ii) result in the acceleration of any Indebtedness owed by it or (iii) result in or require the creation of any consensual Lien upon any of its material assets or properties except as expressly contemplated in, or permitted by, the Loan Documents. Except as expressly contemplated in or permitted by the Loan Documents, disclosed in the Disclosure Schedule or disclosed pursuant to Section 6.4, no permit, consent, approval, authorization or order of, and no notice to or filing, registration or qualification with, any Tribunal is required on the part of Borrower pursuant to the provisions of any material Law applicable to it as a condition to its execution, delivery or performance of any Loan Document or (ii) to consummate any transactions contemplated by the Loan Documents.
Section 5.5. Enforceable Obligations. This Agreement is, and the other Loan Documents when duly executed and delivered will be, legal, valid and binding obligations of Borrower, enforceable in accordance with their terms except as such enforcement may be limited by bankruptcy, insolvency or similar Laws of general application relating to the enforcement of creditors’ rights and general principles of equity.
Section 5.6. Initial Financial Statements. Borrower has heretofore delivered to each Lender true, correct and complete copies of the Initial Financial Statements. The Initial Financial Statements fairly present PAA’s and Borrower’s Consolidated financial position at the date thereof and the Consolidated results of PAA’s and Borrower’s operations for the periods thereof, and in the case of the annual Initial Financial Statements, Consolidated cash flows for the period thereof. Since the date of the annual Initial Financial Statements, no Material Adverse Change has occurred. All Initial Financial Statements described in clause (i) of that defined term were prepared in accordance with GAAP.
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Section 5.7. Other Obligations and Restrictions. As of the closing date hereof, Borrower has no outstanding payment obligations of any kind (including contingent obligations, tax assessments and unusual forward or long-term commitments) which are, in the aggregate, material to Borrower or material with respect to Borrower’s Consolidated financial condition and not reflected in the Initial Financial Statements, disclosed in the Disclosure Schedule or otherwise permitted under Section 7.1. Except as disclosed in the Disclosure Schedule, Borrower is not subject to or restricted by any franchise, contract, deed, charter restriction, or other instrument or restriction which would reasonably be expected to cause a Material Adverse Change.
Section 5.8. Full Disclosure. No certificate, statement or other information delivered herewith or heretofore by Borrower to any Lender in connection with the negotiation of this Agreement or in connection with any transaction contemplated hereby contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements contained herein or therein, in light of the circumstances under which they were made, not misleading as of the date made or deemed made (or if such information expressly relates or refers to an earlier date, as of such earlier date). All written information furnished after the date hereof by or on behalf of Borrower to Administrative Agent or any Lender Party in connection with this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby will be true, complete and accurate in every material respect in light of the circumstances in which made or based on reasonable estimates, in each case as of the date on which such information is stated or certified (or if such information expressly relates or refers to an earlier date, as of such earlier date). There is no fact known to Borrower that has not been disclosed to each Lender in writing which would reasonably be expected to cause a Material Adverse Change.
Section 5.9. Litigation. Except as disclosed in the Initial Financial Statements or in the Disclosure Schedule: (i) there are no actions, suits or legal, equitable, arbitrative or administrative proceedings pending, or to the knowledge of Borrower overtly threatened, against Borrower or affecting any Collateral (including, without limitation, any which challenge or otherwise pertain to Borrower’s title to any Collateral) before any Tribunal which would reasonably be expected to cause a Material Adverse Change, and (ii) there are no outstanding judgments, injunctions, writs, rulings or orders by any such Tribunal against Borrower or, to the knowledge of Borrower, Borrower’s stockholders, partners, directors or officers or affecting any Collateral which would reasonably be expected to cause a Material Adverse Change.
Section 5.10. ERISA Plans and Liabilities. All currently existing ERISA Plans are listed in the Disclosure Schedule or pursuant to Section 6.4. Except as disclosed in the Initial Financial Statements, in the Disclosure Schedule or pursuant to Section 6.4, no Termination Event has occurred with respect to any ERISA Plan and all ERISA Affiliates are in compliance with ERISA in all material respects, to the extent that the non-compliance therewith would not be reasonably expected to cause a Material Adverse Change. No ERISA Affiliate is required to contribute to, or has any other absolute or contingent liability in respect of, any “multiemployer plan” as defined in Section 4001 of ERISA. Except as set forth in the Disclosure Schedule: (i) no “accumulated funding deficiency” (as defined in Section 412(a) of the Code) exists with respect to any ERISA Plan, whether or not waived by the Secretary of the Treasury or his delegate, and
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(ii) the current value of each ERISA Plan’s benefits does not exceed the current value of such ERISA Plan’s assets available for the payment of such benefits by more than $5,000,000.
Section 5.11. Compliance with Permits, Consents and Law. Except as set forth in the Disclosure Schedule or pursuant to Section 6.4, Borrower has all permits, licenses and authorizations required in connection with the conduct of its businesses, except to the extent failure to have any such permit, license or authorization would not reasonably be expected to cause a Material Adverse Change. Borrower is in compliance with the terms and conditions of all such permits, licenses and authorizations, and is also in compliance with all other limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in any Law, including applicable Environmental Law, or in any regulation, code, plan, order, decree, judgment, injunction, notice or demand letter issued, entered, promulgated or approved thereunder, except to the extent that non-compliance therewith would not reasonably be expected to cause a Material Adverse Change or such term, restriction or otherwise is being contested in good faith or a bona fide dispute exists with respect thereto.
Section 5.12. Environmental Laws. Except as set forth in the Disclosure Schedule or disclosed pursuant to Section 6.4, (i) Borrower and its Subsidiaries are conducting their businesses in material compliance with all applicable Laws, including Environmental Laws, and have and are in compliance with all licenses and permits required under any such Laws, unless failure to so comply or have such licenses and permits would not reasonably be expected to cause a Material Adverse Change; (ii) none of the operations or properties of Borrower or any of its Subsidiaries is the subject of federal, provincial or local investigation evaluating whether any material remedial action is needed to respond to a release of any Hazardous Materials into the environment or to the improper storage or disposal (including storage or disposal at offsite locations) of any Hazardous Materials, unless such remedial action would not reasonably be expected to cause a Material Adverse Change; and (iii) neither Borrower nor any of its Subsidiaries (and to the actual knowledge of Borrower, no other Person) has filed any notice under any Law indicating that Borrower or any of its Subsidiaries is responsible for the improper release into the environment, or the improper storage or disposal, of any material amount of any Hazardous Materials or that any Hazardous Materials have been improperly released, or are improperly stored or disposed of, upon any property of any such Person, other than of an alleged improper release, storage or disposal that would not reasonably be expected to cause a Material Adverse Change.
Section 5.13. Accounts; Title to Properties. All Accounts arising from with respect to contracts for the sale of Financed Eligible Hedged Inventory shall qualify as Approved Eligible Receivables, and Borrower has complied in all respects with the terms of each related contract for sale. Borrower has good and defensible title to all of its material properties and assets, free and clear of all Liens (other than Permitted Liens) and of all impediments to the use of such properties and assets in its business, other than such impediments that would not reasonably be expected to cause a Material Adverse Change.
Section 5.14. Government Regulation. Borrower is not subject to regulation under the Public Utility Holding Company Act of 1935, the Investment Company Act of 1940 (as any of the preceding acts have been amended) or any other Law which regulates the incurring by
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Borrower of Indebtedness, including Laws relating to common contract carriers or the sale of electricity, gas, steam, water or other public utility services. Borrower is not subject to regulation under the Federal Power Act which would violate, result in a default of, or prohibit the effectiveness or the performance of any of the provisions of the Loan Documents.
Section 5.15. Insider. Neither Borrower, nor any Person having “control” (as that term is defined in 12 U.S.C. § 375b(9) or in regulations promulgated pursuant thereto) of Borrower, is a “director” or an “executive officer” or “principal shareholder” (as those terms are defined in 12 U.S.C. § 375b(8) or (9) or in regulations promulgated pursuant thereto) of any Lender, of a bank holding company of which any Lender is a Subsidiary or of any Subsidiary of a bank holding company of which any Lender is a Subsidiary.
Section 5.16. Solvency. Upon giving effect to the issuance of the Notes, the execution of the Loan Documents by Borrower and the consummation of the transactions contemplated hereby, (i) Borrower will be solvent (as such term is used in applicable bankruptcy, liquidation, receivership, insolvency or similar Laws), and the sum of Borrower’s absolute and contingent liabilities, including the Obligations or guarantees thereof, shall not exceed the fair market value of Borrower’s assets, and (ii) Borrower’s capital should be adequate for the businesses in which it is engaged and intends to be engaged. Borrower has not incurred (whether under the Loan Documents or otherwise), nor does Borrower intend to incur or reasonably foreseeably believes that it will incur, debts which will be beyond its ability to pay as such debts mature.
Section 5.17. Not a “Reportable Transaction”. Borrower does not intend to treat the Borrowings and/or Letters of Credit and related transactions as being a “reportable transaction” (within the meaning of Treasury Regulation Section 1.6011-4). In the event Borrower determines to take any action inconsistent with such intention, it will promptly notify the Administrative Agent thereof. If Borrower takes any action inconsistent with such intention, or if Borrower so notifies the Administrative Agent, then Borrower acknowledges that, as a result of such action or notice, one or more of the Lenders may treat its Loans and/or its interest in Letters of Credit as part of a transaction that is subject to Treasury Regulation Section 301.6112-1, and such Lender or Lenders will maintain the lists and other records required by such Treasury Regulation.
ARTICLE VI - Affirmative Covenants
To conform with the terms and conditions under which each Lender is willing to consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit to Borrower, and to induce each Lender to enter into this Agreement, consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit hereunder, Borrower covenants and agrees that so long as any Obligations or any commitment of any Participating Lender to extend credit hereunder remains outstanding, unless Majority Lenders, or all Lenders as required under Section 10.1, have previously agreed otherwise:
Section 6.1. Payment and Performance. Borrower will pay all amounts due from it pursuant to the provisions of the Loan Documents to which it is a party in accordance with the
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terms thereof and will observe, perform and comply with every covenant, term and condition imposed on it pursuant to the provisions of such Loan Documents.
Section 6.2. Books, Financial Statements and Reports. Borrower will at all times maintain full and accurate books of account and records. Borrower will maintain a standard system of accounting, will maintain its Fiscal Year, and will furnish the following statements and reports to each Lender at Borrower’s expense:
(a) Promptly upon the filing thereof, and in any event within ninety (90) days after the end of each Fiscal Year: (i) a copy of PAA’s Form 10-K, which report shall include PAA’s complete Consolidated financial statements together with all notes thereto, prepared in reasonable detail in accordance with GAAP, together with an opinion, without material qualification, based on an audit using generally accepted auditing standards, by PricewaterhouseCoopers LLP, or other independent certified public accountants, stating that such Consolidated financial statements have been so prepared, and (ii) Borrower’s complete unaudited Consolidated financial statements, prepared in reasonable detail in accordance with GAAP. These financial statements shall contain a Consolidated balance sheet as of the end of such Fiscal Year and Consolidated statements of earnings for such Fiscal Year. Such Consolidated financial statements shall set forth in comparative form the corresponding figures for the preceding Fiscal Year.
(b) Promptly upon the filing thereof, and in any event within sixty (60) days after the end of each of the first three Fiscal Quarters of each Fiscal Year: (i) a copy of PAA’s Form 10-Q, which report shall include PAA’s unaudited Consolidated balance sheet as of the end of such Fiscal Quarter and Consolidated statements of PAA’s earnings and cash flows for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter, and (ii) Borrower’s unaudited Consolidated balance sheet as of the end of such. Fiscal Quarter and Consolidated statements of Borrower’s earnings and cash flows for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter. In addition Borrower will, together with each such set of financial statements and each set of financial statements furnished under subsection (a) of this section, furnish a copy of the certificate delivered to the administrative agent and lenders under the PAA Credit Agreement pursuant to Section 6.2(b) thereof.
(c) Prompt notice of any publicly announced change in PAA’s Debt Rating by either Standard & Poor’s or Moody’s.
Documents required to be delivered pursuant to Section 6.2(a)(i) or (b)(i) (to the extent any such documents are included in materials otherwise filed with the Securities and Exchange Commission) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which PAA posts such documents, or provides a link thereto, on PAA’s website on the Internet at the website address listed in Section 10.3, and notifies Administrative Agent of such posting or link.
Section 6.3. Other Information and Inspections. In each case subject to the last sentence of this Section 6.3, Borrower will furnish to Administrative Agent any information which Administrative Agent or any Lender may from time to time reasonably request concerning any
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covenant, provision or condition of the Loan Documents or any matter in connection with Borrower’s businesses and operations. In each case subject to the last sentence of this Section 6.3, Borrower will permit representatives appointed by Administrative Agent (including independent accountants, auditors, agents, attorneys, appraisers and any other Persons), upon reasonable prior notice, to visit and inspect during normal business hours any of Borrower’s property, including its books of account, other books and records, and any facilities or other business assets, and to make extra copies therefrom and photocopies and photographs thereof, and to write down and record any information such representatives obtain, and Borrower shall permit Administrative Agent or its representatives to investigate and verify the accuracy of the information furnished to Administrative Agent or any Lender in connection with the Loan Documents and to discuss all such matters with its officers, employees and, upon reasonable prior notice to Borrower, its representatives. Each of the foregoing inspections and examinations shall be made subject to compliance with applicable safety standards and the same conditions applicable to Borrower in respect of property of Borrower on the premises of Persons other than Borrower or an Affiliate of Borrower, and all information, books and records furnished or requested to be made, all information to be investigated or verified and all discussion conducted with any officer, employee or representative of Borrower shall be subject to any applicable attorney-client privilege exceptions which Borrower determines is reasonably necessary and compliance with conditions to disclosures under non-disclosure agreements between Borrower and Persons other than Borrower or an Affiliate of Borrower and the express undertaking of each Person acting at the direction of or on behalf of any Lender Party to be bound by the confidentiality provisions of Section 10.6 of this Agreement.
Section 6.4. Notice of Material Events. Borrower will notify each Lender Party, not later than five (5) Business Days after any executive officer of Borrower has knowledge thereof, stating that such notice is being given pursuant to this Agreement, of:
(a) the occurrence of any Material Adverse Change,
(b) the occurrence of any Default,
(c) the acceleration of the maturity of any Indebtedness owed by Borrower or of any default by Borrower under any indenture, mortgage, agreement, contract or other instrument to which it is a party or by which it or any of its properties is bound, if such acceleration or default would reasonably be expected to cause a Material Adverse Change,
(d) the occurrence of any Termination Event,
(e) any claim under any Environmental Law adverse to Borrower or of potential liability with respect to such claim, or any other adverse claim asserted against Borrower or with respect to Borrower’s properties taken as a whole, in each case, which claim would reasonably be expected to cause a Material Adverse Change, and
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(f) the filing of any suit or proceeding, or the assertion in writing of a claim against Borrower or with respect to Borrower’s properties, which would reasonably be expected to cause a Material Adverse Change.
Upon the occurrence of any of the foregoing Borrower will take all necessary or appropriate steps to remedy promptly, if applicable, any such Material Adverse Change, Default, acceleration, default or Termination Event, to protect against any such adverse claim, to defend any such claim, suit or proceeding, and to resolve all controversies on account of any of the foregoing.
Section 6.5. Maintenance of Existence, Qualifications and Assets. Borrower (i) will maintain and preserve its existence and its rights (including permits, licenses and other authorizations required under Environmental Laws) and franchises in full force and effect, (ii) will qualify to do business in all states or jurisdictions where required by applicable Law, and (iii) keep all Collateral and its other material assets that are useful in and necessary to its business in good working order and condition (ordinary wear and tear and obsoleteness excepted) except, in each case (a) where the failure so to maintain, preserve, qualify or keep would not be reasonably expected to cause a Material Adverse Change, (b) as permitted in Section 7.3 or as a result of statutory conversions or (c) as a result of a release permitted pursuant to Section 6.9. Borrower will also notify Administrative Agent in writing at least twenty Business Days prior to the date that Borrower changes its name or the location of its chief executive office or principal place of business or the place where it keeps its books and records concerning the Collateral, furnishing with such notice any necessary financing statement amendments or requesting Administrative Agent to prepare the same.
Section 6.6. Payment of Taxes, etc. Borrower will (a) timely file all required tax returns (including any extensions), (b) timely pay all taxes, assessments, and other governmental charges or levies imposed upon it or upon its income, profits or property, and (c) maintain appropriate accruals and reserves for all of the foregoing as required by GAAP, except to the extent that (y) it is in good faith contesting the validity thereof by appropriate proceedings, if necessary, and has set aside on its books adequate reserves therefor which are required by GAAP or (z) such non-filing, non-payment or non-maintenance would not reasonably be expected to cause a Material Adverse Change.
Section 6.7. Insurance. In accordance with industry standards, Borrower will keep insured (by responsible and reputable insurance companies or associations) or self-insured, at the option of Borrower, in such amounts and against such risks as are usually insured by Persons engaged in the same or similar businesses and owning similar properties. The insurance coverages and amounts will be reasonably determined by Borrower, based on coverages carried by prudent owners of similar property, and may be maintained by PAA.
Section 6.8. Compliance with Agreements and Law. Borrower will strictly perform and comply with the terms of each contract for the sale of Hedged Eligible Inventory and will perform all other material obligations it is required to perform under the terms of each indenture, mortgage, deed of trust, security agreement, lease, franchise and other material agreement, contract or other instrument (including all contractual obligations and agreements with respect to environmental remediation or other environmental matters) to which it is a party or by which it or
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any of its properties is bound to the extent that non-performance therewith would not reasonably be expected to cause a Material Adverse Change. Borrower will conduct its business and affairs in compliance, in all material respects, with all Laws (including Environmental Laws) applicable thereto to the extent non-compliance therewith would not reasonably be expected to cause a Material Adverse Change or such requirement of Law is being contested in good faith or a bona fide dispute exists with respect thereto.
Section 6.9. Agreement to Deliver Security Documents. Borrower will deliver, to further secure the Obligations whenever requested by Administrative Agent in its sole and absolute discretion, chattel mortgages, security agreements, financing statements and other Security Documents in form and substance satisfactory to Administrative Agent for the purpose of granting, confirming, and perfecting first and prior liens or security interests, subject to applicable Liens permitted pursuant to Section 7.1, in (i) all Financed Hedged Eligible Inventory, (ii) all Hedging Contracts covering Financed Hedged Eligible Inventory, (iii) all contracts for the sale of Financed Hedged Eligible Inventory and Accounts arising thereunder, and (iv) all proceeds of the foregoing.
Section 6.10. Perfection and Protection of Security Interests and Liens. Borrower will from time to time deliver to Administrative Agent any financing statements, continuation statements, extension agreements and other documents, properly completed and executed (and acknowledged when required) by Borrower in form and substance satisfactory to Administrative Agent, which Administrative Agent requests for the purpose of perfecting, confirming, or protecting any Liens or other rights in Collateral securing any Obligations.
ARTICLE VII - Negative Covenants
To conform with the terms and conditions under which each Lender is willing to consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit to Borrower, and to induce each Lender to enter into this Agreement, consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit hereunder, Borrower covenants and agrees that so long as any Obligations or any commitment of any Participating Lender to extend credit hereunder remains outstanding, unless Majority Lenders, or all Lenders as required under Section 10.1, have previously agreed otherwise:
Section 7.1. Limitation on Liens. Borrower will not create, assume or permit to exist:
(i) any Lien upon any Collateral except (A) Liens created pursuant to the Security Documents, (B) Permitted Inventory Liens, (C) statutory Liens in respect of First Purchase Crude Payables, (D) Broker Liens on margin deposits with respect to Hedging Contracts, and (E) any other Liens expressly permitted to encumber such Collateral under any Security Document; or
(ii) any Lien on any Petroleum Products commingled with Financed Hedged Eligible Inventory, or on any sales contracts (and Accounts therefrom and proceeds thereof) covering Petroleum Products in addition to Financed Hedged Eligible Inventory, or with respect to any Hedging Contracts covering Financed Hedged Eligible Inventory, other than Broker Liens on
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margin deposits with respect thereto, unless such lien creditor has agreed in writing that Administrative Agent’s and Lenders’ rights with respect to such Petroleum Products, sales contracts, Hedging Contracts and collateral rights related thereto are first and prior to such lien creditor’s rights therein;
Section 7.2. Limitation on Mergers. Except as expressly provided in this section, Borrower will not (a) merge or consolidate or amalgamate with any Person, or liquidate, wind up or dissolve or (b) sell, transfer, lease, exchange or otherwise dispose of, in one transaction or a series of related transactions, all or substantially all of its business or property, whether now owned or hereafter acquired, to any Person; provided, Borrower may (A) merge into or consolidate or amalgamate with any Subsidiary of PAA; provided, Borrower is the surviving business entity and after giving effect thereto, no Default exists.
Section 7.3. Limitation on Sales of Collateral. Borrower will not sell, transfer, lease, exchange, alienate or dispose of any Collateral except in the ordinary course of business on ordinary trade terms.
Section 7.4. Limitation on New Businesses. Borrower will not materially or substantially engage directly or indirectly in any business or conduct any operations other than (i) marketing, gathering, transporting (by barge, pipeline, ship, truck or other modes of hydrocarbon transportation), terminalling, storing, producing, acquiring, developing, exploring for, exploiting, producing, processing, dehydrating and otherwise handling hydrocarbons, including, without limitation, constructing pipeline, platform, dehydration, processing and other energy-related facilities, (ii) any other business that generates gross income that constitutes “qualifying income” under Section 7704(d) of the Internal Revenue Code of 1986, as amended, or (iii) activities or services reasonably related or ancillary thereto including entering into hedging obligations to support those businesses.
Section 7.5. No Negative Pledges. Except as described in the Disclosure Schedule or pursuant to a Restriction Exception, the substance of which, in detail satisfactory to Administrative Agent, is promptly reported to Administrative Agent, Borrower will not, directly or indirectly, enter into, create, or consent to be bound to any contract or other consensual restriction that restricts the ability of Borrower to create or maintain Liens on its assets in favor of Administrative Agent, LC Issuer and Lenders to secure, in whole or part, the Obligations.
ARTICLE VIII - Events of Default and Remedies
Section 8.1. Events of Default. Each of the following events constitutes an Event of Default under this Agreement:
(a) Borrower fails to pay the principal component of any Loan or any reimbursement obligation with respect to any Letter of Credit when due and payable, whether at a date for the payment of a fixed installment or as a contingent or other payment becomes due and payable or as a result of acceleration or otherwise;
(b) Borrower fails to pay any Obligation for which it is contractually liable (other than the Obligations in subsection (a) above) when due and payable, whether at a date for the payment of
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a fixed installment or as a contingent or other payment becomes due and payable or as a result of acceleration or otherwise, within three Business Days after the same becomes due;
(c) Borrower fails to duly observe, perform or comply with any covenant, agreement or provision of Section 6.4 or Article VII;
(d) Borrower fails (other than as referred to in subsections (a), (b) or (c) above) to duly observe, perform or comply with any of its obligations under any covenant, agreement, condition or provision of any Loan Document to which it is a party, and such failure remains unremedied for a period of thirty (30) days after notice of such failure is given by Administrative Agent to Borrower;
(e) Any representation or warranty previously, presently or hereafter made in writing by or on behalf of Borrower in connection with any Loan Document shall prove to have been false or incorrect in any material respect on any date on or as of which made, or any Loan Document at any time ceases to be valid, binding and enforceable as warranted in Section 5.5 for any reason other than its release or subordination by Administrative Agent;
(f) Borrower shall default in the payment when due of any principal of or interest on any of its other Indebtedness, or, as a result of an early termination event or similar event, on any net hedging obligations, in excess of $15,000,000 in the aggregate (other than such Indebtedness or hedging obligations the validity of which is being contested in good faith, by appropriate proceedings (if necessary) and for which adequate reserves with respect thereto are maintained on the books of Borrower as required by GAAP), or any event specified in any note, agreement, indenture or other document evidencing or relating to any such Indebtedness or hedging obligations shall occur for a period beyond the applicable grace, cure extension, forbearance or other similar period, if the effect of such event is to cause, or (with the giving of any notice or the lapse of time or both) to permit the holder or holders of such Indebtedness or hedging obligations (or a trustee or agent on behalf of such holder or holders) to cause, as applicable, such Indebtedness to become due, or to be prepaid in full (whether by redemption, purchase, offer to purchase or otherwise), prior to its stated maturity, or an early termination event or similar event to occur and Borrower’s related net hedging obligations in excess of $15,000,000 to become due and payable;
(g) Either (i) any “accumulated funding deficiency” (as defined in Section 412(a) of the Code) in excess of $5,000,000 exists with respect to any ERISA Plan, whether or not waived by the Secretary of the Treasury or his delegate, or (ii) any Termination Event occurs with respect to any ERISA Plan and the then current value of such ERISA Plan’s benefit liabilities exceeds the then current value of such ERISA Plan’s assets available for the payment of such benefit liabilities by more than $5,000,000 (or in the case of a Termination Event involving the withdrawal of a substantial employer, the withdrawing employer’s proportionate share of such excess exceeds such amount);
(h) Borrower, any Subsidiary of Borrower, Plains All American GP LLC, Plains AAP, L.P., PAA, or any “significant subsidiary” of PAA, as defined in Article 1, Rule 1-02 of
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Regulation S-X, promulgated pursuant to the Securities Exchange Act of 1934 and the Securities Act of 1933, each as amended:
(i) has entered against it a judgment, decree or order for relief by a Tribunal of competent jurisdiction in an involuntary proceeding commenced under any applicable bankruptcy, insolvency or other similar Law of any jurisdiction now or hereafter in effect, including the federal Bankruptcy Code, as from time to time amended, or has any such proceeding commenced against it, in each case, which remains undismissed for a period of sixty days; or
(ii) commences a voluntary case under any applicable bankruptcy, insolvency or similar Law now or hereafter in effect, including the federal Bankruptcy Code, as from time to time amended; or applies for or consents to the entry of an order for relief in an involuntary case under any such Law; or makes a general assignment for the benefit of creditors; or is generally unable to pay (or admits in writing its inability to so pay) its debts as such debts become due; or takes corporate or other action to authorize any of the foregoing; or
(iii) has entered against it the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of any Collateral or all or a substantial part of its assets in a proceeding brought against or initiated by it, and such appointment or taking possession is neither made ineffective nor discharged within sixty days after the making thereof, or such appointment or taking possession is at any time consented to, requested by, or acquiesced to by it;
(i) Borrower:
(i) has entered against it a final judgment for the payment of money in excess of $15,000,000 (in each case not covered by insurance satisfactory to Administrative Agent in its discretion), unless the same is stayed or discharged within thirty days after the date of entry thereof (or longer period for which a stay of enforcement is allowed by applicable Law) or an appeal or appropriate proceeding for review thereof is taken within such period and a stay of execution pending such appeal is obtained; or
(ii) suffers a writ or warrant of attachment or any similar process to be issued by any Tribunal against any Collateral or all or any substantial part of its assets, and such writ or warrant of attachment or any similar process is not stayed or released within sixty days after the entry or levy thereof (or longer period for which a stay of enforcement is allowed by applicable Law) or after any stay is vacated or set aside;
(j) Any Change in Control occurs; or
(k) Any “Event of Default” shall occur, as such term is used and defined in the PAA Credit Agreement.
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Upon the occurrence of an Event of Default described in subsection (h)(i), (h)(ii) or (h)(iii) of this section: all Obligations shall thereupon be immediately due and payable, without demand, presentment, notice of demand or of dishonor and nonpayment, protest, notice of protest, notice of intention to accelerate, declaration or notice of acceleration, or any other notice or declaration of any kind, all of which are hereby expressly waived by Borrower. Upon any such acceleration, any obligation of any Lender to make any further Loans and any obligation of LC Issuer to issue Letters of Credit hereunder shall be permanently terminated. During the continuance of any other Event of Default, Administrative Agent at any time and from time to time may (and upon written instructions from Majority Lenders, Administrative Agent shall), without notice to Borrower, do either or both of the following: (1) terminate or suspend any obligation of Lenders to make Loans hereunder and any obligation of LC Issuer to issue Letters of Credit hereunder, and (2) declare any or all of the Obligations immediately due and payable, and all such Obligations shall thereupon be immediately due and payable, without demand, presentment, notice of demand or of dishonor and nonpayment, protest, notice of protest, notice of intention to accelerate, declaration or notice of acceleration, or any other notice or declaration of any kind, all of which are hereby expressly waived by Borrower.
Section 8.2. Remedies. If any Default shall occur and be continuing, each Lender Party may protect and enforce its rights under the Loan Documents by any appropriate proceedings, including proceedings for specific performance of any covenant or agreement contained in any Loan Document, and each Lender Party may enforce the payment of any Obligations due it or enforce any other legal or equitable right which it may have. All rights, remedies and powers conferred upon Lender Parties under the Loan Documents shall be deemed cumulative and not exclusive of any other rights, remedies or powers available under the Loan Documents or at Law or in equity.
ARTICLE IX - Administrative Agent
Section 9.1. Appointment and Authority. Each Lender Party hereby irrevocably authorizes Administrative Agent, and Administrative Agent hereby undertakes, to receive payments of principal, interest and other amounts due hereunder as specified herein and to take all other actions and to exercise such powers under the Loan Documents as are specifically delegated to Administrative Agent by the terms hereof or thereof, together with all other powers reasonably incidental thereto. The relationship of Administrative Agent to the other Lender Parties is only that of one commercial lender acting as administrative agent for others, and nothing in the Loan Documents shall be construed to constitute Administrative Agent a trustee or other fiduciary for any Lender Party or any holder of any participation in a Note nor to impose on Administrative Agent duties and obligations other than those expressly provided for in the Loan Documents. With respect to any matters not expressly provided for in the Loan Documents and any matters which the Loan Documents place within the discretion of Administrative Agent, Administrative Agent shall not be required to exercise any discretion or take any action, and it may request instructions from Lenders with respect to any such matter, in which case it shall be required to act or to refrain from acting (and shall be fully protected and free from liability to all Lender Parties in so acting or refraining from acting) upon the instructions of Majority Lenders (including itself), provided, however, that Administrative Agent shall not be required to take any action which exposes it to a risk of personal liability that it considers unreasonable or which is
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contrary to the Loan Documents or to applicable Law. Upon receipt by Administrative Agent from Borrower of any communication calling for action on the part of Lenders or upon notice from Borrower or any Lender to Administrative Agent of any Default or Event of Default, Administrative Agent shall promptly notify each other Lender thereof.
Section 9.2. Exculpation, Administrative Agent’s Reliance, Etc. Neither Administrative Agent nor any of its directors, officers, agents, attorneys, or employees shall be liable for any action taken or omitted to be taken by any of them under or in connection with the Loan Documents, including their negligence of any kind, except that each shall be liable for its own gross negligence or willful misconduct. Without limiting the generality of the foregoing, Administrative Agent (a) may treat the payee of any Note as the holder thereof until Administrative Agent receives written notice of the assignment or transfer thereof in accordance with this Agreement, signed by such payee and in form satisfactory to Administrative Agent; (b) may consult with legal counsel (including counsel for Borrower), independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (c) makes no warranty or representation to any other Lender Party and shall not be responsible to any other Lender Party for any statements, warranties or representations made in or in connection with the Loan Documents; (d) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of the Loan Documents on the part of Borrower or to inspect the property (including the books and records) of Borrower; (e) shall not be responsible to any other Lender Party for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Loan Document or any instrument or document furnished in connection therewith; (f) may rely upon the representations and warranties of Borrower or Lender Party in exercising its powers hereunder; and (g) shall incur no liability under or in respect of the Loan Documents by acting upon any notice, consent, certificate or other instrument or writing (including any facsimile, telegram, cable or telex) believed by it to be genuine and signed or sent by the proper Person or Persons.
Section 9.3. Credit Decisions. Each Lender Party acknowledges that it has, independently and without reliance upon any other Lender Party, made its own analysis of Borrower and the transactions contemplated hereby and its own independent decision to enter into this Agreement and the other Loan Documents. Each Lender Party also acknowledges that it will, independently and without reliance upon any other Lender Party and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents.
Section 9.4. Indemnification. Each Lender agrees to indemnify Administrative Agent (to the extent not reimbursed by Borrower within ten (10) days after demand) from and against such Lender’s Percentage Share of any and all liabilities, obligations, claims, losses, damages, penalties, fines, actions, judgments, suits, settlements, costs, expenses or disbursements (including reasonable fees of attorneys, accountants, experts and advisors) of any kind or nature whatsoever (in this section collectively called “liabilities and costs”) which to any extent (in whole or in part) may be imposed on, incurred by, or asserted against Administrative Agent growing out of, resulting from or in any other way associated with any of the Collateral, the Loan Documents and the
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transactions and events (including the enforcement thereof) at any time associated therewith or contemplated therein and Borrower’s use of loan proceeds (whether arising in contract or in tort or otherwise and including any violation or noncompliance with any Environmental Laws by any Person or any liabilities or duties of any Person with respect to Hazardous Materials found in or released into the environment).
The foregoing indemnification shall apply whether or not such liabilities and costs are in any way or to any extent owed, in whole or in part, under any claim or theory of strict liability or caused, in whole or in part, by any negligent act or omission of any kind by Administrative Agent, provided only that no Lender shall be obligated under this section to indemnify Administrative Agent for that portion, if any, of any liabilities and costs which is proximately caused by Administrative Agent’s own individual gross negligence or willful misconduct, as determined in a final judgment. Cumulative of the foregoing, each Lender agrees to reimburse Administrative Agent promptly upon demand for such Lender’s Percentage Share of any costs and expenses to be paid to Administrative Agent by Borrower under Section 10.4(a) to the extent that Administrative Agent is not timely reimbursed for such expenses by Borrower as provided in such section. As used in this section the term “Administrative Agent” shall refer not only to the Persons designated as such in Section 1.1 but also to each director, officer, agent, attorney, employee, representative and Affiliate of such Person.
Section 9.5. Rights as Lender. In its capacity as a Lender, Administrative Agent shall have the same rights and obligations as any Lender and may exercise such rights as though it were not Administrative Agent. Administrative Agent may accept deposits from, lend money to, act as trustee under indentures of, and generally engage in any kind of business with Borrower or its Affiliates, all as if it were not Administrative Agent hereunder and without any duty to account therefor to any other Lender.
Section 9.6. Sharing of Set-Offs and Other Payments. Each Lender Party agrees that if it shall, whether through the exercise of rights of banker’s lien, set off, or counterclaim against Borrower or otherwise, obtain payment of a portion of the aggregate Obligations owed to it which, taking into account all distributions made by Administrative Agent under Section 3.1, causes such Lender Party to have received more than it would have received had such payment been received by Administrative Agent and distributed pursuant to Section 3.1, then (a) it shall be deemed to have simultaneously purchased and shall be obligated to purchase interests in the Obligations as necessary to cause all Lender Parties to share all payments as provided for in Section 3.1, and (b) such other adjustments shall be made from time to time as shall be equitable to ensure that Administrative Agent and all Lender Parties share all payments of Obligations as provided in Section 3.1; provided, however, that nothing herein contained shall in any way affect the right of any Lender Party to obtain payment (whether by exercise of rights of banker’s lien, set-off or counterclaim or otherwise) of indebtedness other than the Obligations. Borrower expressly consents to the foregoing arrangements, subject to Section 10.9. If all or any part of any funds transferred pursuant to this section is thereafter recovered from the seller under this section which received the same, the purchase provided for in this section shall be deemed to have been rescinded to the extent of such recovery, together with interest, if any, if interest is
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required pursuant to the order of a Tribunal to be paid on account of the possession of such funds prior to such recovery.
Section 9.7. Investments. Whenever Administrative Agent in good faith determines that it is uncertain about how to distribute to Lender Parties any funds which it has received, or whenever Administrative Agent in good faith determines that there is any dispute among Lender Parties about how such funds should be distributed, Administrative Agent may choose to defer distribution of the funds which are the subject of such uncertainty or dispute. If Administrative Agent in good faith believes that the uncertainty or dispute will not be promptly resolved, or if Administrative Agent is otherwise required to invest funds pending distribution to Lender Parties, Administrative Agent shall invest such funds pending distribution; all interest on any such Investment shall be distributed upon the distribution of such Investment and in the same proportion and to the same Persons as such Investment. All moneys received by Administrative Agent for distribution to Lender Parties (other than to the Person who is Administrative Agent in its separate capacity as a Lender Party) shall be held by Administrative Agent pending such distribution solely as Administrative Agent for such Lender Parties, and Administrative Agent shall have no equitable title to any portion thereof.
Section 9.8. Benefit of Article IX. The provisions of this Article are intended solely for the benefit of Lender Parties, and Borrower shall not be entitled to rely on any such provision or assert any such provision in a claim or defense against any Lender (other than contained in Section 9.6 or the right to reasonably approve a successor Administrative Agent under Section 9.9). Lender Parties may waive or amend such provisions as they desire without any notice to or consent of Borrower.
Section 9.9. Resignation. Administrative Agent may resign at any time by giving written notice thereof to Lenders and Borrower. Each such notice shall set forth the date of such resignation. Upon any such resignation Majority Lenders shall have the right to appoint a successor Administrative Agent, subject to the approval of Borrower, unless a Default has occurred and is continuing, which approval will not be unreasonably withheld. A successor must be appointed for any retiring Administrative Agent, and such Administrative Agent’s resignation shall become effective when such successor accepts such appointment. If, within thirty days after the date of the retiring Administrative Agent’s resignation, no successor Administrative Agent has been appointed and has accepted such appointment, then the retiring Administrative Agent may appoint a successor Administrative Agent, which shall be a commercial bank organized or licensed to conduct a banking or trust business under the Laws of the United States of America or of any state thereof. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. After any retiring Administrative Agent’s resignation hereunder the provisions of this Article IX shall continue to inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Loan Documents.
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ARTICLE X - Miscellaneous
Section 10.1. Waivers and Amendments; Acknowledgments.
(a) Waivers and Amendments. No failure or delay (whether by course of
conduct or otherwise) by any Lender in exercising any right, power or remedy which such Lender Party may have under any of the Loan Documents shall operate as a waiver thereof or of any other right, power or remedy, nor shall any single or partial exercise by any Lender Party of any such right, power or remedy preclude any other or further exercise thereof or of any other right, power or remedy. No waiver of any provision of any Loan Document and no consent to any departure therefrom shall ever be effective unless it is in writing and signed as provided below in this section, and then such waiver or consent shall be effective only in the specific instances and for the purposes for which given and to the extent specified in such writing. This Agreement and the other Loan Documents set forth the entire understanding between the parties hereto with respect to the transactions contemplated herein and therein and supersede all prior discussions and understandings with respect to the subject matter hereof and thereof, and no waiver, consent, release, modification or amendment of or supplement to this Agreement or the other Loan Documents shall be valid or effective against any party hereto unless the same is in writing and signed by (i) if such party is Borrower, by Borrower, (ii) if such party is Administrative Agent or LC Issuer, by such party, and (iii) if such party is a Lender, by such Lender or by Administrative Agent on behalf of Lenders with the written consent of Majority Lenders (which consent has already been given as to the termination of the Loan Documents as provided in Section 10.9). Notwithstanding the foregoing or anything to the contrary herein, Administrative Agent shall not, without the prior consent of each individual Lender, execute and deliver on behalf of such Lender any waiver or amendment which would: (1) waive any of the conditions specified in Article IV (provided that Administrative Agent may in its discretion withdraw any request it has made under Section 4.1(h)), (2) increase the maximum amount which such Lender has specified hereunder regarding consideration of financing requests, or extend the termination date of such Lender’s agreement to consider financing requests, (3) reduce any fees payable to such Lender hereunder, or the principal of, or interest on, such Lender’s Note, (4) change any date fixed for any payment of any such fees, principal or interest, or change Section 9.6 in a manner that would alter pro rata sharing of payments required thereby, (5) amend the definition herein of “Majority Lenders” or otherwise change the Percentage Shares which are required for Administrative Agent, Lenders or any of them to take any particular action under the Loan Documents, or (6) except as expressly provided herein or in any other Loan Document, release (i) Borrower from its obligation to pay such Lender’s Note, (ii) any Collateral, or (iii) Borrower from the negative pledge covenant set forth in Section 7.5 hereof.
(b) Acknowledgments and Admissions. Borrower hereby represents, warrants, acknowledges and admits that (i) it has been advised by counsel in the negotiation, execution and delivery of the Loan Documents to which it is a party, (ii) no Lender Party has any fiduciary obligation toward Borrower with respect to any Loan Document or the transactions contemplated thereby, (iii) the relationship pursuant to the Loan Documents between Borrower, on one hand, and each Lender Party, on the other hand, is and shall be solely that of debtor and creditor, respectively, and (iv) no partnership or joint venture exists with respect to the Loan Documents between Borrower and any Lender Party.
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(c) Representation by Lenders. Each Lender hereby represents that it will acquire its Notes for its own account in the ordinary course of its commercial lending or investing business; however, the disposition of such Lender’s property shall at all times be and remain within its control and, in particular and without limitation, such Lender may sell or otherwise transfer its Note, any participation interest or other interest in its Note, or any of its other rights and obligations under the Loan Documents subject to compliance with Sections 10.5(b) through (f), inclusive, and applicable Law.
(d) Joint Acknowledgment. This written Agreement and the other Loan Documents represent the final agreement between the parties and may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties.
There are no unwritten oral agreements between the parties.
Section 10.2. Survival of Agreements; Cumulative Nature. Borrower’s various representations, warranties, covenants and agreements in the Loan Documents shall survive the execution and delivery of this Agreement and the other Loan Documents and the performance hereof and thereof, including the making or granting of the Loans and the delivery of the Notes and the other Loan Documents, and shall further survive until all of the Obligations are paid in full to each Lender Party and all of Lender Parties’ obligations to Borrower are terminated. The rights, powers, and privileges granted to Lender Parties in the Loan Documents, are cumulative, and, except for expressly specified waivers and consents, no Loan Document shall be construed in the context of another to diminish, nullify, or otherwise reduce the benefit to any Lender Party of any such right, power or privilege.
Section 10.3. Notices. All notices, requests, consents, demands and other communications required or permitted under any Loan Document shall be in writing, unless otherwise specifically provided in such Loan Document (provided that Administrative Agent may give telephonic notices to the other Lender Parties), and shall be deemed sufficiently given or furnished if delivered by personal delivery, by facsimile or other electronic transmission, by delivery service with proof of delivery, or by registered or certified United States mail, postage prepaid, to Borrower at the address of Borrower specified on the signature pages hereto and to each Lender Party at its address specified on the signature pages hereto (unless changed by similar notice in writing given by the particular Person whose address is to be changed). Any such notice or communication shall be deemed to have been given (a) in the case of personal delivery or delivery service, as of the date of first attempted delivery during normal business hours at the address provided herein, (b) in the case of facsimile or other electronic transmission, upon receipt, or (c) in the case of registered or certified United States mail, three days after deposit in the mail; provided, however, that no Borrowing Notice or Continuation/Conversion Notice shall become effective until actually received by Administrative Agent.
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Section 10.4. Payment of Expenses; Indemnity.
(a) Payment of Expenses. Whether or not the transactions contemplated by this Agreement are consummated, Borrower will promptly (and in any event, within 30 days after any invoice or other statement or notice) pay: (i) all transfer, stamp, mortgage, documentary or other similar taxes, assessments or charges levied by any governmental or revenue authority in respect of this Agreement or any of the other Loan Documents or any other document referred to herein or therein, (ii) all reasonable costs and expenses incurred by or on behalf of Administrative Agent (including attorneys’ fees, consultants’ fees and engineering fees, travel costs and miscellaneous expenses) in connection with (1) the negotiation, preparation, execution and delivery of the Loan Documents, and any and all consents, waivers or other documents or instruments relating thereto, (2) the filing, recording, refiling and re-recording of any Loan Documents and any other documents or instruments or further assurances required to be filed or recorded or refiled or re-recorded by the terms of any Loan Document, (3) the borrowings hereunder and other action reasonably required in the course of administration hereof, (4) monitoring or confirming (or preparation or negotiation of any document related to) Borrower’s compliance with any covenants or conditions contained in this Agreement or in any Loan Document, and (iii) all reasonable costs and expenses incurred by or on behalf of any Lender Party (including attorneys’ fees, consultants’ fees and accounting fees) in connection with the defense or enforcement of any of the Loan Documents (including this section) or the defense of any Lender Party’s exercise of its rights thereunder. In addition to the foregoing, until all Obligations have been paid in full, Borrower will also pay or reimburse Administrative Agent for all reasonable out-of-pocket costs and expenses of Administrative Agent or its agents or employees in connection with the continuing administration of the Loans and the related due diligence of Administrative Agent, including travel and miscellaneous expenses and fees and expenses of Administrative Agent’s outside counsel and consultants engaged in connection with the Loan Documents.
(b) Indemnity. Borrower agrees to indemnify each Lender Party, upon demand, from and against any and all liabilities, obligations, claims, losses, damages, penalties, fines, actions, judgments, suits, settlements, costs, expenses or disbursements (including reasonable fees of attorneys, accountants, experts and advisors) of any kind or nature whatsoever (in this section collectively called “liabilities and costs”) which to any extent (in whole or in part) may be imposed on, incurred by, or asserted against such Lender Party growing out of, resulting from or in any other way associated with any of the Collateral, the Loan Documents and the transactions and events (including the enforcement or defense thereof) at any time associated therewith or contemplated therein and Borrower’s use of Loan proceeds (whether arising in contract or in tort or otherwise and including any violation or noncompliance with any Environmental Laws by any Lender Party or any other Person or any liabilities or duties of any Lender Party or any other Person with respect to Hazardous Materials found in or released into the environment).
The foregoing indemnification shall apply whether or not such liabilities and costs are in any way or to any extent owed, in whole or in part, under any claim or theory of strict liability or caused, in whole or in part, by any negligent act or omission of any kind by any Lender Party, provided only that no Lender Party shall be entitled under this section to receive indemnification for that portion, if any, of any liabilities and costs which is proximately caused by its own individual gross negligence or willful misconduct, as determined in a final judgment. If any Person (including Borrower or any of its Affiliates) ever alleges such gross negligence or willful misconduct by any Lender Party, the
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indemnification provided for in this section shall nonetheless be paid upon demand, subject to later adjustment or reimbursement, until such time as a court of competent jurisdiction enters a final judgment as to the extent and effect of the alleged gross negligence or willful misconduct. As used in this section the term “Lender Party” shall refer not only to each Person designated as such in Section 1.1 but also to each director, officer, trustee, agent, attorney, employee, representative and Affiliate of such Persons.
(c) Interest. Borrower hereby promises to each Lender Party interest at the Default Rate on all Obligations to pay fees or to reimburse or indemnify any Lender Party which Borrower has promised to pay to such Lender Party pursuant to this Section 10.4 and which are not paid when due. Such interest shall accrue from the date such Obligations become due until they are paid.
Section 10.5. Parties in Interest; Assignments; Replacement Notes.
(a) All grants, covenants and agreements contained in the Loan Documents shall bind and inure to the benefit of the parties thereto and their respective successors and permitted assigns; provided, however, that Borrower may not assign or transfer any of its rights or delegate any of its duties or obligations under any Loan Document without the prior consent of all Lenders. Neither Borrower nor any Affiliates of Borrower shall directly or indirectly purchase or otherwise retire any Obligations owed to any Lender nor will any Lender accept any offer to do so, unless each Lender shall have received substantially the same offer with respect to the same Percentage Share of the Obligations owed to it. If Borrower or any Affiliate of Borrower at any time purchases some but less than all of the Obligations owed to all Lender Parties, such purchaser shall not be entitled to any rights of any Lender under the Loan Documents unless and until Borrower or its Affiliates have purchased all of the Obligations.
(b) No Lender shall sell any participation interest in its commitment hereunder or any of its rights under its Loans or under the Loan Documents to any Person unless the agreement between such Lender and such participant at all times provides: (i) that such participation exists only as a result of the agreement between such participant and such Lender and that such transfer does not give such participant any right to vote as a Lender or any other direct claims or rights against any Person other than such Lender, (ii) that such participant is not entitled to payment from Borrower under Sections 3.2 through 3.6 of amounts in excess of those payable to such Lender under such sections (determined without regard to the sale of such participation), and (iii) unless such participant is an Affiliate of such Lender, that such participant shall not be entitled to require such Lender to take any action under any Loan Document or to obtain the consent of such participant prior to taking any action under any Loan Document, except for actions which would require the consent of all Lenders under subsection (a) of Section 10.1. No Lender selling such a participation shall, as between the other parties hereto and such Lender, be relieved of any of its obligations hereunder as a result of the sale of such participation. Each Lender which sells any such participation to any Person (other than an Affiliate of such Lender) shall give prompt notice thereof to Administrative Agent and Borrower; provided, however, that no liability shall arise if any such Lender fails to give such notice to Borrower.
(c) Except for sales of participations under the immediately preceding subsection, no Lender shall make any assignment or transfer of any kind of its commitments or any of its rights
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under its Loans or under the Loan Documents, except for assignments to an Eligible Transferee or, subject to the provisions of subsection (g) below, to an affiliate, and then only if such assignment is made in accordance with the following requirements:
(i) In the case of an assignment by a Lender of less than all of its Loans, LC Obligations and any commitment hereunder, each such assignment shall apply to a consistent percentage of all Loans and LC Obligations owing to the assignor Lender hereunder and to the same percentage of the unused portion of the assignor Lender’s Percentage Share of the Maximum Loan Amount, so that after such assignment is made both the assignee Lender and the assignor Lender shall have a fixed (and not a varying) Percentage Share in its Loans and LC Obligations and be committed to make that Percentage Share of all future Loans and make that Percentage Share of all future participations in LC Obligations, and the Percentage Share of the Maximum Facility Amount of each of the assignor and assignee shall equal or exceed $5,000,000.
(ii) The parties to each such assignment shall execute and deliver to Administrative Agent, for its acceptance and recording in the “Register” (as defined below in this section), an Assignment and Acceptance in the form of Exhibit G, appropriately completed, together with the Note subject to such assignment and a processing fee payable by such assignor Lender (and not at Borrower’s expense) to Administrative Agent of $3,500. Upon such execution, delivery, and payment and upon the satisfaction of the conditions set out in such Assignment and Acceptance, then (i) Borrower shall issue new Notes to such assignor and assignee upon return of the old Notes to Borrower, and (ii) as of the “Settlement Date” specified in such Assignment and Acceptance the assignee thereunder shall be a party hereto and a Lender hereunder and Administrative Agent shall thereupon deliver to Borrower and each Lender a revised Schedule 1 hereto showing the revised Percentage Shares and total Percentage Shares of such assignor Lender and such assignee Lender and the revised Percentage Shares and total Percentage Shares of all other Lenders.
(iii) Each assignee Lender which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for Federal income tax purposes, shall (to the extent it has not already done so) provide Administrative Agent and Borrower with the “Prescribed Forms” referred to in Section 3.7(d).
(d) Any Lender may at any time pledge all or any portion of its Loan and Note (and related rights under the Loan Documents including any portion of its Note) to any of the twelve (12) Federal Reserve Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or enforcement thereof shall release any such Lender from its obligations under any of the Loan Documents; provided that all related costs, fees and expenses in connection with any such pledge shall be for the sole account of such Lender.
(e) By executing and delivering an Assignment and Acceptance, each assignee Lender thereunder will be confirming to and agreeing with Borrower, Administrative Agent and each other Lender Party that such assignee understands and agrees to the terms hereof, including Article IX hereof.
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(f) Administrative Agent shall maintain a copy of each Assignment and Acceptance and a register for the recordation of the names and addresses of Lenders and the Percentage Shares of, and principal amount of the Loans owing to, each Lender from time to time (in this section called the “Register”). The entries in the Register shall be conclusive, in the absence of manifest error, and Borrower and each Lender Party may treat each Person whose name is recorded in the Register as a Lender Party hereunder for all purposes. The Register shall be available for inspection by Borrower or any Lender Party at any reasonable time and from time to time upon reasonable prior notice.
(g) Any Lender may assign or transfer its commitment or its rights under its Loans or under the Loan Documents to (i) any Affiliate that is wholly-owned direct or indirect subsidiary of such Lender or of any Person that wholly owns, directly or indirectly, such Lender, or (ii) if such Lender is a fund that makes or invests in bank loans, any other fund that makes or invests in bank loans and is advised or managed by (A) the same investment advisor as any Lender or (B) any Affiliate of such investment advisor that is a wholly-owned direct or indirect subsidiary of any Person that wholly owns, directly or indirectly, such investment advisor, subject to the following additional conditions (x), (y) and (z), with respect to assignments pursuant to clause (i) above, and subject to the following additional conditions (y) and (z) with respect to assignments pursuant to clause (ii) above:
(x) any right of such Lender assignor and such assignee to vote as a Lender, or any other direct claims or rights against any other Persons, shall be uniformly exercised by both such assignor and assignee or pursued in the manner that such Lender assignor would have so exercised such vote, claim or right if it had not made such assignment or transfer; and
(y) such assignee shall not be entitled to payment from Borrower under Sections 3.2 through 3.7 of amounts in excess of those payable to such Lender assignor under such sections (determined without regard to such assignment or transfer); and
(z) if such Lender assignor is a Lender that assigns or transfers to such assignee any of such Lender’s Percentage Share of any commitment hereunder, assignee may become primarily liable for such commitment, but such assignment or transfer shall not relieve or release such Lender from such commitment.
(h) Upon receipt of an affidavit reasonably satisfactory to Borrower of an officer of any Lender as to the loss, theft, destruction or mutilation of its Note which is not of public record, and, in the case of any such loss, theft, destruction or mutilation, upon cancellation of such Note, Borrower will execute and deliver, in lieu thereof, a replacement Note in the same principal amount thereof and otherwise of like tenor.
Section 10.6. Confidentiality. Each Lender Party agrees (on behalf of itself and each of its Affiliates, and each of its and their directors, officers, agents, attorneys, employees, and representatives) that it (and each of them) will take all reasonable steps to keep confidential any non-public information supplied to it by or at the direction of Borrower so identified when
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delivered, provided, however, that this restriction shall not apply to (a) information which has at the time in question entered the public domain, other than as a result of a breach of this Section 10.6, (b) information which is required to be disclosed by Law (whether valid or invalid) of any Tribunal, (c) any disclosure to any Lender Party’s Affiliates, auditors, attorneys or agents (provided each such Person first agrees to hold such information in confidence on the terms provided in this Section 10.6), (d) any disclosure to any other Lender Party or to any purchaser or prospective purchaser of participations or other interests in any Loan or Loan Document (provided each such Person first agrees to hold such information in confidence on the terms provided in this section), or (e) any disclosure in the course of enforcing its rights and remedies during the existence of an Event of Default. Notwithstanding anything herein to the contrary, confidential information shall not include, and each Lender Party and Borrower may disclose and may permit to be disclosed to any and all Persons, without limitation of any kind, the “tax treatment” and “tax structure” (in each case, within the meaning of Treasury Regulation Section 1.6011-4) of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses) that are or have been provided to such Lender Party or Borrower relating to such tax treatment and tax structure.
Section 10.7. Governing Law; Submission to Process. Except to the extent that the Law of another jurisdiction is expressly elected in a Loan Document, the Loan Documents shall be deemed contracts and instruments made under the Laws of the State of New York and shall be construed and enforced in accordance with and governed by the Laws of the State of New York and the Laws of the United States of America, without regard to principles of conflicts of law. Borrower hereby agrees that any legal action or proceeding against Borrower with respect to this Agreement, the Notes or any of the Loan Documents may be brought in the courts of the State of New York or of the United States of America for the Southern District of New York as Lender Parties may elect, and, by execution and delivery hereof, Borrower accepts and consents for itself and in respect to its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each Borrower agrees that Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York shall apply to the Loan Documents and waives any right to stay or to dismiss any action or proceeding brought before said courts on the basis of forum non conveniens. In furtherance of the foregoing, Borrower hereby irrevocably designates and appoints Corporation Service Company, 80 State Street, Albany, New York 12207, as agent of Borrower to receive service of all process brought against Borrower with respect to any such proceeding in any such court in New York, such service being hereby acknowledged by Borrower to be effective and binding service in every respect. Copies of any such process so served shall also, if permitted by Law, be sent by registered mail to Borrower at its address set forth below, but the failure of Borrower to receive such copies shall not affect in any way the service of such process as aforesaid. Borrower shall furnish to Lender Parties a consent of Corporation Service Company agreeing to act hereunder prior to the effective date of this agreement. Nothing herein shall affect the right of Lender Parties to serve process in any other manner permitted by Law or shall limit the right of Lender Parties to bring proceedings
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against Borrower in the courts of any other jurisdiction. If for any reason Corporation Service Company shall resign or otherwise cease to act as Borrower’s agent, Borrower hereby irrevocably agrees to (a) immediately designate and appoint a new agent acceptable to Administrative Agent to serve in such capacity and, in such event, such new agent shall be deemed to be substituted for Corporation Service Company for all purposes hereof and (b) promptly deliver to Administrative Agent the written consent (in form and substance satisfactory to Administrative Agent) of such new agent agreeing to serve in such capacity.
Section 10.8. Limitation on Interest. Lender Parties, Borrower and any other parties to the Loan Documents intend to contract in strict compliance with applicable usury Law from time to time in effect. In furtherance thereof such Persons stipulate and agree that none of the terms and provisions contained in the Loan Documents shall ever be construed to create a contract to pay, for the use, forbearance or detention of money, interest in excess of the maximum amount of interest permitted to be contracted for, charged, or received by applicable Law from time to time in effect. Neither Borrower nor any present or future guarantors, endorsers, or other Persons hereafter becoming liable for payment of any Obligation shall ever be liable for unearned interest thereon or shall ever be required to pay interest thereon in excess of the maximum amount that may be lawfully contracted for, charged, or received under applicable Law from time to time in effect, and the provisions of this section shall control over all other provisions of the Loan Documents which may be in conflict or apparent conflict herewith. Lender Parties expressly disavow any intention to contract for, charge, or receive excessive unearned interest or finance charges in the event the maturity of any Obligation is accelerated. If (a) the maturity of any Obligation is accelerated for any reason, (b) any Obligation is prepaid and as a result any amounts held to constitute interest are determined to be in excess of the legal maximum, or (c) any Lender or any other holder of any or all of the Obligations shall otherwise collect moneys which are determined to constitute interest which would otherwise increase the interest on any or all of the Obligations to an amount in excess of that permitted to be contracted for, charged or received by applicable Law then in effect, then all sums determined to constitute interest in excess of such legal limit shall, without penalty, be promptly applied to reduce the then outstanding principal of the related Obligations or, at such Lender’s or holder’s option, promptly returned to Borrower or other payor thereof upon such determination. In determining whether or not the interest paid or payable, under any specific circumstance, exceeds the maximum amount permitted under applicable Law, Lender Parties and Borrower (and any other payors thereof) shall to the greatest extent permitted under applicable Law, (i) characterize any non-principal payment as an expense, fee or premium rather than as interest, (ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize, prorate, allocate, and spread the total amount of interest throughout the entire contemplated term of the instruments evidencing the Obligations in accordance with the amounts outstanding from time to time thereunder and the maximum legal rate of interest from time to time in effect under applicable Law in order to lawfully charge the maximum amount of interest permitted under applicable Law. In the event applicable Law provides for an interest ceiling under Chapter 303 of the Texas Finance Code (the “Texas Finance Code”) as amended, to the extent that the Texas Finance Code is mandatorily applicable to any Lender, for that day, the ceiling shall be the “weekly ceiling” as defined in the Texas Finance Code, provided that if any applicable Law permits greater interest, the Law
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permitting the greatest interest shall apply. In no event shall Chapter 346 of the Texas Finance Code apply to this Agreement or any other Loan Document, or any transactions or loan arrangement provided or contemplated hereby or thereby.
Section 10.9. Right of Offset. At any time and from time to time during the continuance of any Event of Default, each Lender is hereby authorized to offset against the Obligations then due and payable (without notice to Borrower), (a) any and all moneys, securities or other property (and the proceeds therefrom) of Borrower now or hereafter held or received by or in transit to any Lender from or for the account of Borrower, whether for safekeeping, custody, pledge, transmission, collection or otherwise, (b) any and all deposits (general or special, time or demand, provisional or final) of Borrower with any Lender, and (c) any other credits and claims of Borrower at any time existing against any Lender, including claims under certificates of deposit.
Section 10.10. Termination; Limited Survival. In its sole and absolute discretion Borrower may at any time that no Obligations are owing or outstanding elect in a written notice delivered to Administrative Agent to terminate this Agreement. Upon receipt by Administrative Agent of such a notice, if no Obligations are then owing or outstanding this Agreement and all other Loan Documents shall thereupon be terminated and the parties thereto released from all prospective obligations thereunder. Notwithstanding the foregoing or anything herein to the contrary, any waivers or admissions made by Borrower in any Loan Document, any Obligations under Sections 3.2 through 3.6, and any obligations which any Person may have to indemnify or compensate any Lender Party shall survive any termination of this Agreement or any other Loan Document. At the request and expense of Borrower, Administrative Agent shall prepare and execute all necessary instruments to reflect and effect such termination of the Loan Documents. Administrative Agent is hereby authorized to execute all such instruments on behalf of all Lenders, without the joinder of or further action by any Lender.
Section 10.11. Severability. If any term or provision of any Loan Document shall be determined to be illegal or unenforceable all other terms and provisions of the Loan Documents shall nevertheless remain effective and shall be enforced to the fullest extent permitted by applicable Law.
Section 10.12. Counterparts. This Agreement may be separately executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to constitute one and the same Agreement.
Section 10.13. Waiver of Jury Trial, Punitive Damages, etc. Borrower and Lender Parties mutually hereby knowingly, voluntarily, and intentionally waive the right to a trial by jury in respect of any claim based hereon, arising out of, under or in connection with, this Agreement or any other Loan Documents contemplated to be executed in connection herewith or any course of conduct, course of dealings, statements (whether verbal or written) or actions of any party. This waiver constitutes a material inducement for Lenders to enter into this Agreement and the other Loan Documents and make the Loans. Borrower and each Lender Party hereby further (a) irrevocably waives, to the maximum
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extent not prohibited by Law, any right it may have to claim or recover in any such litigation any “Special Damages,” as defined below, (b) certifies that no party hereto nor any representative or agent or counsel for any party hereto has represented, expressly or otherwise, or implied that such party would not, in the event of litigation, seek to enforce the foregoing waivers, and (c) acknowledges that it has been induced to enter into this Agreement, the other Loan Documents and the transactions contemplated hereby and thereby by, among other things, the mutual waivers and certifications contained in this section. As used in this section, “Special Damages” includes all special, consequential, exemplary, or punitive damages (regardless of how named), but does not include any payments or funds which any party hereto has expressly promised to pay or deliver to any other party hereto.
Section 10.14. Replacement Credit Facility. Borrower states and acknowledges that this Agreement is entered into by it in replacement of that certain Second Amended and Restated Credit Agreement [Letter of Credit and Hedged Inventory Facility] dated July 2, 2002 (the “Expiring LC Facility”), among Borrower, Fleet National Bank as administrative agent and the lenders party thereto. Borrower further states, acknowledges and agrees that the preceding sentence does not and shall not alter or otherwise modify in any regard, directly or indirectly, expressly or impliedly or otherwise, (i) any termination of the Expiring LC Facility or, among other things, the termination of the Liens created to secure the Expiring LC Facility or (ii) the terms, provisions and conditions expressly set forth in, and contemplated by, this Agreement, or the transactions contemplated hereby, which in each case shall be governed solely by the terms, provisions and conditions of this Agreement and the other Loan Documents without regard to this Section 10.14; and for the avoidance of any doubt, such preceding sentence does not and shall not alter or modify in any regard, directly or indirectly, expressly or impliedly or otherwise, the discretionary and un-committed nature of the credit facility referred to herein.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, this Agreement is executed as of the date first written above.
Borrower:
PLAINS MARKETING, L.P.
By:
PLAINS MARKETING GP INC.,
its general partner
By:
Al Swanson, Treasurer
Address for Borrower:
333 Clay Street, Suite 1600
Houston, Texas 77002
Attention: Al Swanson
Telephone: (713) 646-4455
Fax: (713) 646-4564
PAA Website: www.paalp.com
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FLEET NATIONAL BANK,
Administrative Agent, LC Issuer and a Lender
By:
Terrence Ronan, Managing Director
FLEET SECURITIES, INC.,
Lead Arranger and Book Manager
By:
Michael P. Hannon, Managing Director
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BNP PARIBAS, a Lender
By:
Name:
Title:
By:
Name:
Title:
65
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SOCIETE GENERALE, a Lender
By
Name:
Title:
66
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SCHEDULE 1
LENDER SCHEDULE
Lender
Percentage Share of Maximum Facility Amount
Percentage Share(1)
Fleet National Bank
$
100,000,000.00
50.000000
%
BNP Paribas
$
75,000,000.00
37.500000
%
Societe Generale
$
25,000,000.00
12.500000
%
TOTALS
$
200,000,000.00
100.000000
%
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(1) Rounded to six decimal places
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LENDER INFORMATION
Lender
Contact
Domestic Lending Office
LIBOR Lending Office
Fleet National Bank
100 Federal Street Energy & Utilities MADE 10009H vice MADE 10008D Boston, Massachusetts 02110 Attn: Terrence Ronan Phone: 617-434-5472 Fax: 617-434-3652
100 Federal Street Boston, Massachusetts 02110
100 Federal Street Boston, Massachusetts 02110
BNP Paribas
787 7th Avenue New York, New York 10019 Attn: Ed Chin Phone: 212-841-2020 Fax: 212-841-2536
787 7th Avenue New York, New York 10019
787 7th Avenue New York, New York 10019
Societe Generale
1221 Avenue of the Americas New York, New York 10020 Attn: Jordan Nenoff Phone: 212-278-7407 Fax: 212-278-7417
1221 Avenue of the Americas New York, New York 10020
1221 Avenue of the Americas New York, New York 10020
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SCHEDULE 3
SECURITY SCHEDULE
1. Security Agreement of even date herewith by Borrower in favor of Administrative Agent, for the benefit of Lenders, covering Hedged Eligible Inventory, Hedging Contracts, Petroleum Product sales contracts and Accounts therefrom and proceeds thereof as from time to time specified by Borrower (the “Security Agreement”).
2. UCC-1 Financing Statement naming Borrower as debtor and Administrative Agent as secured party, covering the Collateral described in the Security Agreement.
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SCHEDULE 4
PRICING GRID
Applicable Rating Level
Applicable Margin Base Rate Loans
Applicable Margin LIBOR Loans and LC Fee Rate
Level I
0.000
%
0.375
%
Level II
0.000
%
0.500
%
Level III
0.000
%
0.750
%
Level IV
0.000
%
1.000
%
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SCHEDULE 5
CURRENTLY APPROVED PERSONS AND FACILITIES
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EXHIBIT A
NOTE
$
New York, New York
, 200
FOR VALUE RECEIVED, the undersigned, Plains Marketing, L.P., a Delaware limited partnership (herein called “Borrower”), hereby promises to pay to the order of (herein called “Lender”), the principal sum of ($ ), or, if greater or less, the aggregate unpaid principal amount of the Loans made under this Note by Lender to Borrower pursuant to the terms of the Credit Agreement (as hereinafter defined), together with interest on the unpaid principal balance thereof as hereinafter set forth, both principal and interest payable as herein provided in lawful money of the United States of America at the offices of Administrative Agent under the Credit Agreement, as from time to time may be designated by the holder of this Note.
This Note (a) is issued and delivered under that certain Credit Agreement dated November 21, 2003 among Borrower, Fleet National Bank, as Administrative Agent, and the lenders (including Lender) referred to therein (herein, as from time to time supplemented, amended or restated, called the “Credit Agreement”), and is a “Note” as defined therein, (b) is subject to the terms and provisions of the Credit Agreement, which contains provisions for payments and prepayments hereunder and acceleration of the maturity hereof upon the happening of certain stated events, and (c) is guaranteed by and entitled to the benefits of certain guaranties (as identified in the Credit Agreement). Payments on this Note shall be made and applied as provided herein and in the Credit Agreement. Reference is hereby made to the Credit Agreement for a description of certain rights, limitations of rights, obligations and duties of the parties hereto and for the meanings assigned to terms used and not defined herein and to the guaranties for a description of the nature and extent of the guarantee thereby provided and the rights of the parties thereto.
The principal amount of this Note shall bear interest and shall be due and payable from time to time as provided in the Credit Agreement with the remaining unpaid principal balance of this Note being due and payable in full on or before the Maturity Date. Accrued and unpaid interest hereon shall be due and payable on each Interest Payment Date as provided in the Credit Agreement and on the Maturity Date.
Notwithstanding the foregoing paragraph and all other provisions of this Note, in no event shall the interest payable hereon, whether before or after maturity, exceed the maximum interest which, under applicable Law, may be charged on this Note, and this Note is expressly made subject to the provisions of the Credit Agreement which more fully set out the limitations on how interest accrues hereon.
If this Note is placed in the hands of an attorney for collection after default, or if all or any part of the indebtedness represented hereby is proved, established or collected in any court or in any bankruptcy, receivership, debtor relief, probate or other court proceedings, Borrower and
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all endorsers, sureties and guarantors of this Note jointly and severally agree to pay reasonable attorneys’ fees and collection costs to the holder hereof in addition to the principal and interest payable hereunder.
Borrower and all endorsers, sureties and guarantors of this Note hereby severally waive demand, presentment, notice of demand and of dishonor and nonpayment of this Note, protest, notice of protest, notice of intention to accelerate the maturity of this Note, declaration or notice of acceleration of the maturity of this Note, diligence in collecting, the bringing of any suit against any party and any notice of or defense on account of any extensions, renewals, partial payments or changes in any manner of or in this Note or in any of its terms, provisions and covenants, or any releases or substitutions of any security, or any delay, indulgence or other act of any trustee or any holder hereof, whether before or after maturity.
This Note and the rights and duties of the parties hereto shall be governed by the Laws of the State of New York (without regard to principles of conflicts of law), except to the extent the same are governed by applicable federal Law.
PLAINS MARKETING, L.P.
By:
PLAINS MARKETING GP INC.,
its general partner
By:
Name:
Title:
2
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EXHIBIT B-1
FINANCING REQUEST-INITIAL
Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement.
Pursuant to the terms of the Agreement, Borrower hereby requests Lenders to finance Cash and Carry Purchases or storage of Hedged Eligible Inventory as set forth on the attached Schedule, by participating in Letters of Credit to secure such Cash and Carry Purchases and/or make Loans to finance such Cash and Carry Purchases or storage of such Hedged Eligible Inventory for the following:
Delivery Month: , 200
Sale/Purchase Month: , 200
Funding Date (Settlement Date for Delivery Month): , 200
Hedged Value of Hedged Eligible Inventory: $
Initial Financing Request (90% of Hedged Value): $
To induce Lenders to commit to finance such Cash and Carry Purchases or storage of such Hedged Eligible Inventory, Borrower hereby represents, warrants, acknowledges, and agrees to and with Administrative Agent and each Lender that:
(a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower.
(b) The representations and warranties of Borrower set forth in the Agreement and the other Loan Documents are true and correct on and as of the date hereof (except to the extent that such representation or warranty was made as of a specific date, or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date), with the same effect as though such representations and warranties had been made on and as of the date hereof.
(c) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the financing requested hereby. Borrower will use all Letters of Credit and Loans hereby requested in compliance with Section 2.5 of the Agreement.
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(d) The Facility Usage, after the issuance of Letters of Credit and/or the making of the requested Loans contemplated hereby, will not be in excess of the Maximum Facility Amount on the date requested for the issuance of such Letters of Credit or the making of such Loans.
(e) The Petroleum Products inventory described on the attached Schedule, when purchased by Borrower, will (i) qualify as Hedged Eligible Inventory as defined in the Agreement, (ii) be located at the Approved Locations set forth on the attached Schedule and (iii) be subject to the Hedging Contracts listed on the attached Schedule, with the Hedged Value set forth thereon. Borrower hereby grants a lien on and security interest in all Petroleum Products listed on the attached Schedule, the related Hedging Contracts specified thereon, to the extent such Hedging Contracts pertain or relate to such Petroleum Products, all sales contracts now or hereafter entered into with respect to such Petroleum Products, to the extent such sales contracts pertain or relate to such Petroleum Products, all Accounts arising therefrom, and all proceeds thereof, in favor of Administrative Agent for the benefit of Lenders, and expressly acknowledges and agrees that all such Petroleum Products, Hedging Contracts, sales contracts, Accounts and proceeds constitute “Collateral” as defined in the Security Agreement, and Borrower and Administrative Agent, by its acceptance hereof, hereby agree that the Security Agreement, and the definition of “Collateral” set forth therein, is hereby supplemented hereby.
(f) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement. The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects.
The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects.
IN WITNESS WHEREOF, this instrument is executed as of , .
PLAINS MARKETING, L.P.
By:
PLAINS MARKETING GP INC.,
its general partner
By:
Name:
Title:
2
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EXHIBIT B-2
FINANCING REQUEST-FINAL
Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement.
Pursuant to the terms of the Agreement and that certain Financing Request-Initial dated , 200 (the “Initial Request), Borrower hereby amends and supplements such Initial Request and the Schedule thereto as follows:
Delivery Month: , 200
Sale/Purchase Month: , 200
Funding Date (Settlement Date for Delivery Month): , 200
Sale Value of Hedged Eligible Inventory: $
Final Financing Request: $
(90% of lesser of (i) Sale Value and
(ii) 110% of Hedged Value as set forth in Initial Request)
[In addition, Borrower hereby requests each Participating Lender consent to financing its Percentage Share of an additional amount equal to the amount by which the Sale Value of such Financed Hedged Eligible Inventory as set forth on the attached Schedule exceeds 110% of the Hedged Value of such Financed Hedged Eligible Inventory as set forth in the Initial Request].
To induce Participating Lenders to make such Loans, Borrower hereby represents, warrants, acknowledges, and agrees to and with Administrative Agent and each Participating Lender that:
(a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower.
(b) The representations and warranties of Borrower set forth in the Agreement and the other Loan Documents are true and correct on and as of the date hereof (except to the extent that such representation or warranty was made as of a specific date, or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date), with the same effect as though such representations and warranties had been made on and as of the date hereof.
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(c) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the Loans requested hereby. Borrower will use the Loans hereby requested in compliance with Section 2.5 of the Agreement.
(d) The Facility Usage, after the making of the Loans requested hereby, will not be in excess of the Maximum Facility Amount on the date requested for the making of such Loans.
(e) The Petroleum Products inventory described on the attached Schedule (i) qualifies as Hedged Eligible Inventory as defined in the Agreement, (ii) is located at the Approved Locations set forth on the attached Schedule, (iii) is subject to the Hedging Contracts listed on the attached Schedule, (iv) is subject to the sales contracts listed on the attached Schedule, with the Sale Value set forth thereon. Borrower hereby grants a lien on and security interest in all Petroleum Products listed on the attached Schedule, the related Hedging Contracts specified thereon, to the extent such Hedging Contracts pertain or relate to such Petroleum Products, the sales contracts listed on the attached Schedule and all other sales contracts now or hereafter entered into with respect to such Petroleum Products, to the extent such sales contracts pertain or related to such Petroleum Products, all Accounts arising therefrom, and all proceeds thereof, in favor of Administrative Agent for the benefit of Lenders, and expressly acknowledges and agrees that all such Petroleum Products, Hedging Contracts, sales contracts, Accounts and proceeds constitute “Collateral” as defined in the Security Agreement, and Borrower and Administrative Agent, by its acceptance hereof, hereby agree that the Security Agreement, and the definition of “Collateral” set forth therein, is hereby supplemented hereby.
(f) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement. The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects.
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The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects.
IN WITNESS WHEREOF, this instrument is executed as of , .
PLAINS MARKETING, L.P.
By:
PLAINS MARKETING GP INC.,
its general partner
By:
Name:
Title:
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EXHIBIT B-3
BORROWING NOTICE
Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement.
Pursuant to the terms of the Agreement and that certain Financing Request-Final dated , 200 (the “Final Request”), Borrower hereby requests the Participating Lenders set forth below to make Loans to Borrower in the aggregate principal amount of $ and specifies the Funding Date set forth below as the date Borrower desires for Lenders to make such Loans and for Administrative Agent to deliver to Borrower the proceeds thereof.
Delivery Month: , 200
Participating Lenders:
Funding Date (Settlement Date for Delivery Month): , 200
Type of Loan: [LIBOR Loans] [Base Rate Loans]
Length of Interest Rate for LIBOR Loan (1 month):
To induce Participating Lenders to make such Loans, Borrower hereby represents, warrants, acknowledges, and agrees to and with Administrative Agent and each Participating Lender that:
(a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower.
(b) The representations and warranties of Borrower set forth in the Agreement and the other Loan Documents, including the Final Request) are true and correct on and as of the date hereof (except to the extent that such representation or warranty was made as of a specific date, or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date), with the same effect as though such representations and warranties had been made on and as of the date hereof.
(c) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the
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Loans requested hereby. Borrower will use the Loans hereby requested in compliance with Section 2.5 of the Agreement.
(d) The Facility Usage, after the making of the Loans requested hereby, will not be in excess of the Maximum Facility Amount on the date requested for the making of such Loans.
(e) The Loans requested hereby will not be in excess of 90% of the lesser of (i) the Sale Value of the Hedged Eligible Inventory as set forth in the Final Request and (ii) 110% of Hedged Value as set forth in Initial Request (as defined in the Final Request).
(f) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement. The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects.
The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects.
IN WITNESS WHEREOF, this instrument is executed as of , .
PLAINS MARKETING, L.P.
By:
PLAINS MARKETING GP INC.,
its general partner
By:
Name:
Title:
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EXHIBIT C
CONTINUATION/CONVERSION NOTICE
Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement.
Borrower hereby requests a conversion or continuation of existing Loans into a new Borrowing pursuant to Section 2.4 of the Agreement as follows:
Existing Borrowing(s) of Loans to be Continued or Converted:
$ of LIBOR Loans with Interest Period ending
$ of Base Rate Loans
Aggregate amount of new Borrowing:
$
Type of Loans in new Borrowing:
Date of Continuation or Conversion:
Length of Interest Period for LIBOR Loans
(1, 2, 3, 6, or 12 months):
months
Borrower hereby represents, warrants, acknowledges, and agrees to and with each Lender that:
(a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower.
(b) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the Loans requested hereby.
(c) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement. The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects.
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The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects.
IN WITNESS WHEREOF, this instrument is executed as of , .
PLAINS MARKETING, L.P.
By:
PLAINS MARKETING GP INC.,
its general partner
By:
Name:
Title:
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EXHIBIT D-1
OPINION OF IN-HOUSE COUNSEL TO BORROWER
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EXHIBIT D-2
OPINION OF FULBRIGHT & JAWORSKI, L.L.P., COUNSEL TO BORROWER
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EXHIBIT E
LETTER OF CREDIT APPLICATION AND AGREEMENT
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EXHIBIT F
Irrevocable Standby Letter of Credit
DATE:
BENEFICIARY
CONFIRMING OUR CABLE OF TODAY
Credit Number:
Dear Sir or Madam:
BY ORDER OF:
PLAINS MARKETING, L.P.
HOUSTON, TX 77002
We hereby open in your favor our Irrevocable Standby Letter of Credit for the account of PLAINS MARKETING, L.P. for a sum of approximately US DOLLARS ( ) available by your draft(s) at SIGHT on OURSELVES effective and expiring at OUR COUNTERS on .
DRAFTS MUST BE ACCOMPANIED BY:
1. COPY(IES) OF COMMERCIAL INVOICE(S) MARKED “UNPAID” ISSUED TO PLAINS MARKETING, L.P. COVERING CRUDE OIL DELIVERED IN , .
2. WARRANTY OF TITLE ISSUED TO PLAINS MARKETING, L.P. AND SIGNED BY AN AUTHORIZED REPRESENTATIVE OF CERTIFYING THAT “IN CONSIDERATION OF YOUR PAYMENT OF THE ATTACHED INVOICE, WE HEREBY EXPRESSLY WARRANT THAT WE HAD MARKETABLE TITLE TO SUCH MATERIAL, AND THAT WE HAD FULL RIGHT AND AUTHORITY TO TRANSFER AND EFFECT DELIVERY OF SUCH MATERIAL TO YOU OR YOUR ASSIGNS AND HEREBY AGREE TO PROTECT, INDEMNIFY AND HOLD PLAINS MARKETING, L.P. HARMLESS FROM AND AGAINST ANY AND ALL COSTS, DAMAGES, EXPENSES, AND CLAIMS, INCLUDING BUT NOT LIMITED TO REASONABLE ATTORNEY’S FEES, WHICH YOU MIGHT SUFFER OR INCUR ARISING OR RESULTING FROM ANY BREACH OF THE ABOVE WARRANTY.”
3. A STATEMENT SIGNED BY AN AUTHORIZED REPRESENTATIVE OF STATING THAT: HEREBY CERTIFIES THAT INVOICED QUANTITIES OF
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PRODUCT HAVE BEEN DELIVERED FREE AND CLEAR OF ALL LIENS AND ENCUMBRANCES TO PLAINS MARKETING, L.P. WHICH HAS FAILED TO PAY FOR THIS PRODUCT, AND THE MONIES HEREBY DRAWN ARE DUE AND PAYABLE.
SPECIAL CONDITIONS:
A. THIS LETTER OF CREDIT IS AVAILABLE FOR PAYMENT AT SIGHT BUT NOT PRIOR TO , .
B. THE AMOUNT AVAILABLE FOR DRAWING UNDER THIS LETTER OF CREDIT WILL BE REDUCED BY THE AMOUNT OF ANY PAYMENT(S) MADE OUTSIDE THIS LETTER OF CREDIT TO BY PLAINS MARKETING, L.P. FOR THIS PRODUCT IF SUCH PAYMENT(S) IS/ARE MADE THROUGH FLEET NATIONAL BANK, BOSTON, MA REFERENCING THIS LETTER OF CREDIT NUMBER.
C. ALL BANKING CHARGES OTHER THAN THOSE OF FLEET NATIONAL BANK ARE FOR THE ACCOUNT OF THE BENEFICIARY.
D. PARTIAL DRAWINGS AND PARTIAL SHIPMENTS ARE PERMITTED.
E. COMMERCIAL INVOICE(S) REFERENCED ABOVE IN EXCESS OF THE U.S. DOLLAR AMOUNT OF THIS LETTER OF CREDIT IS (ARE) ACCEPTABLE; HOWEVER, PAYMENT NOT TO EXCEED THE VALUE OF THIS LETTER OF CREDIT.
F. DOCUMENTS PRESENTED MORE THAN TWENTY-ONE DAYS AFTER THE TRANSPORT DATE BUT WITHIN THE VALIDITY OF THIS CREDIT ARE ACCEPTABLE.
Except so far as otherwise expressly stated herein, this letter of credit is subject to the “Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500.”
We hereby agree that drafts drawn under and in compliance with the terms of this letter of credit will be duly honored if presented to the above-mentioned drawee bank on or before , .
The word “approximately”, insofar as it refers to the amount of this credit, is to be construed as allowing a difference not to exceed 10% more or 10% less.
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Kindly address all correspondence regarding this letter of credit to the attention of our Letter of Credit Operations, P.O. Box 1763, BOSTON, MA 02105, attention , mentioning our reference number as it appears above. Telephone inquiries can be made to at .
Very truly yours,
Authorized Official
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EXHIBIT G
ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Credit Agreement dated as of November 21, 2003 (as from time to time amended, the “Agreement”), by and among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement.
The “Assignor” and the “Assignee” referred to on Schedule 1 agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, without recourse and without representation or warranty except as expressly set forth herein, and the Assignee hereby purchases and assumes from the Assignor, an interest in and to the Assignor’s rights and obligations under the Agreement and the other Loan Documents as of the date hereof equal to the percentage interest specified on Schedule 1 of all outstanding rights and obligations under the Agreement and the other Loan Documents with respect to the Loans and commitment, if any. After giving effect to such sale and assignment, the Assignee’s amount of the Loans owing to the Assignee will be as set forth on Schedule 1.
2. The Assignor (i) represents and warrants that it is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any adverse claim; (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Loan Documents or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any other instrument or document furnished pursuant thereto; (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of Borrower or the performance or observance by Borrower of any of its obligations under the Loan Documents or any other instrument or document furnished pursuant thereto; and (iv) attaches the Note held by the Assignor and requests that Administrative Agent exchange such Note for [a new Note payable to the order of the Assignee] [new Notes in an amount equal to Assignee’s Percentage Share of the Maximum Facility Amount assumed by the Assignee pursuant hereto and to the Assignor in an amount equal to its Percentage Share of the Maximum Facility Amount retained by the Assignor, if any], as specified on Schedule 1.
3. The Assignee (i) confirms that it has received a copy of the Agreement, together with copies of the financial statements referred to in Section 6.2 thereof and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (ii) agrees that it will, independently and without reliance upon Administrative Agent, the Assignor or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Agreement; (iii) confirms that it is an Eligible Transferee, (iv) appoints and authorizes Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Agreement as are delegated to Administrative Agent by the terms thereof, together with such powers and discretion
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as are reasonably incidental thereto; (v) agrees that it will perform in accordance with their terms all of the obligations that by the terms of the Agreement are required to be performed by it as a Lender; and (vi) attaches any U.S. Internal Revenue Service or other forms required under Section 10.5.
4. Following the execution of this Assignment and Acceptance, it will be delivered to Administrative Agent for acceptance and recording by Administrative Agent. The effective date for this Assignment and Acceptance (the “Effective Date”) shall be the date of acceptance hereof by Administrative Agent, unless otherwise specified on Schedule 1.
5. Upon such acceptance and recording by Administrative Agent, as of the Effective Date, (i) the Assignee shall be a party to the Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and (ii) the Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Agreement.
6. Upon such acceptance and recording by Administrative Agent, from and after the Effective Date, Administrative Agent shall make all payments under the Agreement and the Notes in respect of the interest assigned hereby (including, without limitation, all payments of principal, interest and commitment fees with respect thereto) to the Assignee. The Assignor and Assignee shall make all appropriate adjustments in payments under the Agreement and the Notes for periods prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed in accordance with, the Laws of the State of New York.
8. This Assignment and Acceptance may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall be effective as delivery of a manually executed counterpart of this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule 1 to this Assignment and Acceptance to be executed by their officers thereunto duly authorized as of the date specified thereon.
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SCHEDULE 1 to ASSIGNMENT AND ACCEPTANCE
Assignee’s Percentage Share of Maximum Facility Amount:
$
Assignee’s Percentage Share:
%
Aggregate outstanding principal amount of Loans assigned:
$
Principal amount of Note payable to Assignee:
$
Principal amount of Note payable to Assignor (if retained):
$
]
Effective Date (if other than date of acceptance
by Administrative Agent:
* , 200
[NAME OF ASSIGNOR], as Assignor
By:
Title:
Dated: , 200
[NAME OF ASSIGNEE], as Assignee
By:
Title:
Domestic Lending Office:
LIBOR Lending Office:
--------------------------------------------------------------------------------
* This date should be no earlier than five Business Days after the delivery of this Assignment and Acceptance to Administrative Agent.
Accepted this day of , 200
FLEET NATIONAL BANK
By:
Title:
[Approved this day of , 200
[PLAINS MARKETING, L.P.
By:
PLAINS MARKETING GP INC., its general partner
By:
Title:
-------------------------------------------------------------------------------- | [
"EXHIBIT 10.21 CREDIT AGREEMENT PLAINS MARKETING, L.P., as Borrower, FLEET NATIONAL BANK, as Administrative Agent, FLEET SECURITIES, INC., as Lead Arranger and Book Manager, and CERTAIN FINANCIAL INSTITUTIONS, as Lenders $200,000,000 Uncommited Senior Secured Discretionary Contango Facility November 21, 2003 -------------------------------------------------------------------------------- TABLE OF CONTENTS ARTICLE I - Definitions and References Section 1.1. Defined Terms Section 1.2. Exhibits and Schedules; Additional Definitions Section 1.3. Amendment of Defined Instruments Section 1.4. References and Titles Section 1.5. Calculations and Determinations ARTICLE II - Loans and Letters of Credit Section 2.1. Financing Requests, Commitments and Fundings Section 2.2. Loans and Notes Section 2.3.",
"Requests for Loans Section 2.4. Continuations and Conversions of Existing Loans Section 2.5. Use of Proceeds Section 2.6. Interest Rates and Fees Section 2.7. Optional Prepayments Section 2.8. Mandatory Prepayments and Payments Section 2.9. Extension of Request Period. Section 2.10. Letters of Credit Section 2.11. Requesting Letters of Credit Section 2.12. Reimbursement and Participations Section 2.13. Letter of Credit Fees Section 2.14. No Duty to Inquire ARTICLE III - Payments to Lenders Section 3.1. General Procedures Section 3.2. Capital Reimbursement Section 3.3. Increased Cost of LIBOR Loans or Letters of Credit Section 3.4. Notice; Change of Applicable Lending Office Section 3.5. Availability Section 3.6.",
"Funding Losses Section 3.7. Reimbursable Taxes Section 3.8. Replacement of Lenders. ARTICLE IV - Conditions Precedent to Lending Section 4.1. Documents to be Delivered Section 4.2. Additional Conditions Precedent ARTICLE V - Representations and Warranties Section 5.1. No Default Section 5.2. Organization and Good Standing Section 5.3. Authorization Section 5.4. No Conflicts or Consents Section 5.5. Enforceable Obligations i -------------------------------------------------------------------------------- Section 5.6. Initial Financial Statements Section 5.7. Other Obligations and Restrictions. Section 5.8. Full Disclosure Section 5.9. Litigation Section 5.10. ERISA Plans and Liabilities Section 5.11. Compliance with Permits, Consents and Law Section 5.12. Environmental Laws Section 5.13. Accounts; Title to Properties Section 5.14. Government Regulation Section 5.15. Insider Section 5.16. Solvency ARTICLE VI - Affirmative Covenants Section 6.1. Payment and Performance Section 6.2. Books, Financial Statements and Reports. Section 6.3.",
"Other Information and Inspections Section 6.4. Notice of Material Events Section 6.5. Maintenance of Existence, Qualifications and Assets Section 6.6. Payment of Taxes, etc. Section 6.7. Insurance Section 6.8. Compliance with Agreements and Law Section 6.9. Agreement to Deliver Security Documents Section 6.10. Perfection and Protection of Security Interests and Liens ARTICLE VII - Negative Covenants Section 7.1. Limitation on Liens Section 7.2. Limitation on Mergers Section 7.3. Limitation on Sales of Collateral Section 7.4. Limitation on New Businesses Section 7.5. No Negative Pledges ARTICLE VIII - Events of Default and Remedies Section 8.1. Events of Default Section 8.2. Remedies ARTICLE IX - Administrative Agent Section 9.1. Appointment and Authority Section 9.2. Exculpation, Administrative Agent’s Reliance, Etc. Section 9.3. Credit Decisions Section 9.4.",
"Indemnification Section 9.5. Rights as Lender Section 9.6. Sharing of Set-Offs and Other Payments Section 9.7. Investments Section 9.8. Benefit of Article IX Section 9.9. Resignation ii -------------------------------------------------------------------------------- ARTICLE X - Miscellaneous Section 10.1. Waivers and Amendments; Acknowledgments Section 10.2. Survival of Agreements; Cumulative Nature Section 10.3. Notices Section 10.4. Payment of Expenses; Indemnity Section 10.5. Parties in Interest; Assignments; Replacement Notes Section 10.6. Confidentiality Section 10.7. Governing Law; Submission to Process Section 10.8. Limitation on Interest Section 10.9. Right of Offset Section 10.10. Termination; Limited Survival Section 10.11.",
"Severability Section 10.12. Counterparts Section 10.13. Waiver of Jury Trial, Punitive Damages, etc. Section 10.14. Replacement Credit Facility iii -------------------------------------------------------------------------------- Schedules and Exhibits: Schedule 1 - Lender Schedule Schedule 2 - Disclosure Schedule Schedule 3 - Security Schedule Schedule 4 - Pricing Grid Schedule 5 - Currently Approved Persons and Facilities Exhibit A - Note Exhibit B-1 - Financing Request-Initial Exhibit B-2 - Financing Request-Final Exhibit B-3 - Borrowing Notice Exhibit C - Continuation/Conversion Notice Exhibit D-1 - Opinion of In-House Counsel for Borrower Exhibit D-2 - Opinion of Fulbright & Jaworski L.L.P., Counsel for Borrower Exhibit E - Form of Letter of Credit Exhibit F - Letter of Credit Application and Agreement Exhibit G - Assignment and Acceptance Agreement iv -------------------------------------------------------------------------------- CREDIT AGREEMENT THIS CREDIT AGREEMENT is made as of November 21, 2003, by and among PLAINS MARKETING, L.P., a Delaware limited partnership (“Borrower”), FLEET NATIONAL BANK, as administrative agent (in such capacity, “Administrative Agent”), FLEET SECURITIES, INC., as lead arranger and book manager (in such capacity, “Lead Arranger and Book Manager”) and the Lenders referred to below. In consideration of the mutual covenants and agreements contained herein the parties hereto agree as follows: W I T N E S S E T H In consideration of the mutual covenants and agreements contained herein and in consideration of the loans which may hereafter by made by Lenders, in each Lender’s sole and absolute discretion, and the Letters of Credit which may be made available by LC Issuer to Borrower upon Lenders’ election to participate in such Letters of Credit, in each Lender’s sole and absolute discretion, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: ARTICLE I - Definitions and References Section 1.1.",
"Defined Terms. As used in this Agreement, each of the following terms has the meaning given to such term in this Section 1.1 or in the sections and subsections referred to below: “Account” shall have the meaning given that term in the UCC. “Account Debtor” means any Person who is or who may become obligated under, with respect to, or on account of, an Account. “Administrative Agent” means Fleet National Bank, as Administrative Agent hereunder, and its successors in such capacity. “Affiliate” means, as to any Person, each other Person that directly or indirectly (through one or more intermediaries or otherwise) controls, is controlled by, or is under common control with, such Person.",
"A Person shall be deemed to be “controlled by” any other Person if such other Person possesses, directly or indirectly, power to direct or cause the direction of the management and policies of such Person whether by contract or otherwise. “Agreement” means this Credit Agreement. “Applicable Lending Office” means, for each Lender and for each Type of Loan, the “Lending Office” of such Lender (or of an Affiliate of such Lender) designated for such Type of Loan on the Lender Schedule or such other office of such Lender (or an Affiliate of such Lender) as such Lender may from time to time specify to Administrative Agent and Borrower by written -------------------------------------------------------------------------------- notice in accordance with the terms hereof as the office by which its Loans of such Type are to be made and maintained. “Applicable Margin” means, as to any Type of Loan, the percent per annum set forth on the Pricing Grid as the “Applicable Margin” for such Type of Loan, based on the Applicable Rating Level in effect on such date. Changes in the Applicable Margin will occur automatically without prior notice as changes in the Applicable Rating Level occur.",
"Administrative Agent will give notice promptly to Borrower and Lenders of changes in the Applicable Margin. “Applicable Rating Level” means for any day, the level set forth below that corresponds to the PAA Debt Rating by the Ratings Agencies applicable on such day; provided, in the event the PAA Debt Rating by the Ratings Agencies differs by one level, the higher PAA Debt Rating shall apply; provided further, in the event the PAA Debt Rating by the Ratings Agencies differs by more than one level, the PAA Debt Rating one level above the lower PAA Debt Rating shall apply; provided, notwithstanding the foregoing, the Applicable Rating Level for the period from the date hereof through and including February 21, 2004 shall be Level III. As used in this definition, “ >“ means a rating equal to or more favorable than and “<“ means a rating less favorable than.",
"Rating Level S&P Moody’s Level I > BBB+ > Baa1 Level II BBB Baa2 Level III BBB- Baa3 Level IV < BBB- < Baa3 If either of the Rating Agencies shall not have in effect a PAA Debt Rating or if the rating system of either of the Rating Agencies shall change, or if either of the Rating Agencies shall cease to be in the business of rating corporate debt obligations, Borrower and Majority Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such Rating Agency, but until such an agreement shall be reached, the Applicable Rating Level shall be based only upon the PAA Debt Rating by the remaining Rating Agency. “Approved Eligible Receivables” means an Eligible Receivable (a) from a Person whose Debt Rating is either at least Baa3 by Moody’s or at least BBB- by S&P; (b) fully and unconditionally guaranteed as to payment by a Person whose Debt Rating is either at least Baa3 by Moody’s or at least BBB- by S&P; (c) from any other Person Currently Approved by Majority Lenders; or (d) fully covered by a letter of credit from any national or state bank or trust company which is organized under the laws of the United States of America or any state thereof or any branch licensed to operate under the laws of the United States of America or any state thereof, which is a branch of a bank organized under any country which is a member of the Organization 2 -------------------------------------------------------------------------------- for Economic Cooperation and Development, in each case which has capital, surplus and undivided profits of at least $500,000,000 and whose commercial paper is rated at least P-1 by Moody’s or A-1 by S&P.",
"“Approved Location” means (i) a Plains Terminal, (ii) storage locations or pipelines Currently Approved by Majority Lenders for which Administrative Agent has received a bailee letter in form and substance reasonably acceptable to Administrative Agent with respect to any Collateral stored at such locations or pipelines, or (iii) storage locations or pipelines Currently Approved by Majority Lenders storing Financed Hedged Eligible Inventory not in excess of five percent (5%) of all Financed Hedged Eligible Inventory. “Base Rate” means the higher of (i) the variable per annum rate of interest so designated from time to time by Administrative Agent as its “prime rate”, or (ii) the Federal Funds Rate plus one-half percent (0.5%) per annum. The “prime rate” is a reference rate and does not necessarily represent the lowest or best rate being charged to any customer.",
"Changes in the Base Rate resulting from changes in the “prime rate” shall take place immediately without notice or demand of any kind. “Base Rate Loan” means a Loan to Borrower which does not bear interest at a rate based upon the LIBOR Rate. “Borrower” means Plains Marketing, L.P., a Delaware limited partnership. “Borrowing” means a borrowing of new Loans of a single Type pursuant to Section 2.3 or a Continuation or Conversion of existing Loans into a single Type (and, in the case of LIBOR Loans, with the same Interest Period) pursuant to Section 2.4.",
"“Borrowing Notice” means a written or telephonic request, or a written confirmation, made by a Borrower which meets the requirements of Section 2.3. “Broker Liens” means any Liens under or with respect to accounts with brokers or counterparties with respect to Hedging Contracts in favor of such brokers or counterparties, securing only obligations under such Hedging Contracts. “Business Day” means any day, other than a Saturday, Sunday or day which shall be in the Commonwealth of Massachusetts a legal holiday or day on which banking institutions are required or authorized to close. Any Business Day in any way relating to LIBOR Loans (such as the day on which an Interest Period begins or ends) must also be a day on which commercial banks settle payments in London. “Cash and Carry Purchases” means purchases of Petroleum Products for physical storage at an Approved Location which qualify as Hedged Eligible Inventory.",
"“Cash Equivalents” means Investments in: 3 -------------------------------------------------------------------------------- (a) marketable obligations, maturing within 12 months after acquisition thereof, issued or unconditionally guaranteed by the United States of America or the federal government of Canada or an instrumentality or agency thereof and entitled to the full faith and credit of the United States of America or the federal government of Canada, as the case may be; (b) demand deposits and time deposits (including certificates of deposit) maturing within 12 months from the date of deposit thereof, (i) with any office of any Lender or (ii) with a domestic office of any national, state or provincial bank or trust company which is organized under the Laws of the United States of America or any state therein, or the federal government of Canada or any province therein, which has capital, surplus and undivided profits of at least $500,000,000, and whose long term certificates of deposit are rated at least Aa3 by Moody’s or AA- by S&P; (c) repurchase obligations with a term of not more than seven days for underlying securities of the types described in subsection (a) above entered into with (i) any Lender or (ii) any other commercial bank meeting the specifications of subsection (b) above; (d) open market commercial paper, maturing within 270 days after acquisition thereof, which are rated at least P-1 by Moody’s or A-1 by S&P; and (e) money market or other mutual funds substantially all of whose assets comprise securities of the types described in subsections (a) through (d) above. “Change of Control” means PAA shall cease to be, directly or indirectly, the sole legal and beneficial owner (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended) of all of the partnership interests (including all securities which are convertible into partnership interests) of Borrower.",
"“Code” means the Internal Revenue Code of 1986, as amended from time to time, together with all rules and regulations promulgated with respect thereto. “Collateral” means all property of any kind which is subject to a Lien in favor of Lenders (or in favor of Administrative Agent for the benefit of Lenders) or which, under the terms of any Security Document, is purported to be subject to such a Lien, in each case granted or created to secure all or part of the Obligations. “Consolidated” refers to the consolidation of any Person, in accordance with GAAP, with its properly consolidated subsidiaries. References herein to a Person’s Consolidated financial statements, financial position, financial condition, liabilities, etc. refer to the consolidated financial statements, financial position, financial condition, liabilities, etc. of such Person and its properly consolidated subsidiaries. “Continue”, “Continuation” and “Continued” shall refer to the continuation pursuant to Section 2.4 of a LIBOR Loan as a LIBOR Loan from one Interest Period to the next Interest Period. 4 -------------------------------------------------------------------------------- “Continuation/Conversion Notice” means a written or telephonic request, or a written confirmation, made by Borrower which meets the requirements of Section 2.4.",
"“Convert, “Conversion” and “Convert” refers to a conversion pursuant to Section 2.4 of one Type of Loan into another Type of Loan. “Currently Approved by Majority Lenders” means such Person (including a limit on the maximum Hedged Eligible Inventory sold to any such Person), storage location, pipeline, form of Letter of Credit or other matter as the case may be, as reflected in Schedule 5 attached hereto and as amended from time to time by the most recent written notice given by Administrative Agent to Borrower as being approved by Majority Lenders. Each such amended Schedule 5 will supersede and revoke each prior Schedule 5.",
"“Default” means any Event of Default and any default, event or condition which would, with the giving of any requisite notices and the passage of any requisite periods of time, constitute an Event of Default. “Default Rate” means, at the time in question, two percent (2%) per annum plus: (a) the LIBOR Rate plus the Applicable Margin then in effect for each LIBOR Loan (up to the end of the applicable Interest Period), (b) the Base Rate plus the Applicable Margin then in effect for each Base Rate Loan, provided, however, the Default Rate shall never exceed the Highest Lawful Rate. “Default Rate Period” means (i) any period during which an Event of Default, other than pursuant to Section 8.1 (a) or (b), is continuing, provided that such period shall not begin until notice of the commencement of the Default Rate has been given to Borrower by Administrative Agent upon the instruction by Majority Lenders and (ii) any period during which any Event of Default pursuant to Section 8.1 (a) or (b) is continuing unless Borrower has been notified otherwise by Administrative Agent upon the instruction by Majority Lenders.",
"“Delivery Month” has the meaning given to such term in Section 2.1(a). “Disclosure Schedule” means Schedule 2 hereto. “Dollars” and “$” means the lawful currency of the United States of America, except where otherwise specified. “Eligible Inventory” means inventories of Petroleum Products in which Borrower has lawful and absolute title (specifically excluding, however, tank bottoms and pipeline linefill of Borrower classified as a long-term asset), which are not subject to any Lien in favor of any Person (other than Permitted Inventory Liens), which are subject to a fully perfected first priority security interest (subject only to Permitted Inventory Liens) in favor of Administrative Agent pursuant to the Loan Documents prior to the rights of, and enforceable as such against, any other 5 -------------------------------------------------------------------------------- Person, which are otherwise satisfactory to Majority Lenders in their reasonable business judgment and located at Approved Locations, minus without duplication the amount of any Permitted Inventory Lien on any such inventory.",
"“Eligible Receivables” means, at the time of any determination thereof (and without duplication), each Account and, with respect to each determination made on or after the 20th day of each calendar month and prior to the first day of the next calendar month, each amount which will be, in the good faith estimate reasonably determined by Borrower, an Account of the Borrower with respect to sales and deliveries of Hedged Eligible Inventory during such calendar month or deliveries of Hedged Eligible Inventory during the next calendar month under firm written purchase and sale agreements, in either event as to which the following requirements have been fulfilled (or as to future Accounts, will be fulfilled as of the date of such sales and deliveries of Hedged Eligible Inventory), to the reasonable satisfaction of Administrative Agent: (i) Borrower has lawful and absolute title to such Account; (ii) such Account is a valid, legally enforceable obligation of an Account Debtor payable in Dollars, arising from the sale and delivery of Hedged Eligible Inventory to such Person in the United States of America in the ordinary course of business of Borrower, to the extent of the volumes of Hedged Eligible Inventory delivered to such Person prior to the date of determination; (iii) there has been excluded from such Account (A) any portion that is subject to any dispute, rejection, loss, non-conformance, counterclaim or other claim or defense on the part of any Account Debtor or to any claim on the part of any Account Debtor denying liability under such Account, and (B) the amount of any account payable or other liability owed by Borrower to the Account Debtor on such Account, whether or not a specific netting agreement may exist, excluding, however, any portion of any such account payable or other liability which is at the time in question covered by a Letter of Credit; (iv) Borrower has the full and unqualified right to assign and grant a security interest in such Account to Administrative Agent as security for the Obligation; (v) such Account (A) is evidenced by an invoice rendered to the Account Debtor, or (B) represents the uninvoiced amount in respect of volumes of Hedged Eligible Inventory scheduled to be delivered by Borrower in the current or next-following calendar month, is governed by a purchase and sale agreement, exchange agreement or other written agreement, and in either event such Account is not evidenced by any promissory note or other instrument; (vi) such Account is not subject to any Lien in favor of any Person and is subject to a fully perfected first priority security interest in favor of Administrative Agent pursuant to the Loan Documents, prior to the rights of, and enforceable as such against, any other Person except for a Lien in respect of First Purchase Crude Payables; 6 -------------------------------------------------------------------------------- (vii) such Account is due not more than 30 days following the last day of the calendar month in which the Hedged Eligible Inventory delivery occurred and is not more than 30 days past due; (viii) such Account is not payable by an Account Debtor with more than twenty percent (20%) of its Accounts to Borrower that are outstanding more than 60 days from the invoice date; (ix) the Account Debtor in respect of such Account (A) is located, is conducting significant business or has significant assets in the United States of America or is a Person Currently Approved by Majority Lenders, (B) is not an Affiliate of Borrower, and (C) is not the subject of any event of the type described in Section 8.1(i); and (x) the Account Debtor in respect of such Account is not a governmental authority, domestic or foreign.",
"“Eligible Transferee” means a Person which either (a) is a Lender, or (b) is consented to as an Eligible Transferee by Administrative Agent and, so long as no Default or Event of Default is continuing, by Borrower, which consents in each case will not be unreasonably withheld; provided no Person organized outside the United States may be an Eligible Transferee if Borrower would be required to pay withholding taxes on interest or principal owed to such Person. “Environmental Laws” means any and all Laws relating to the environment or to emissions, discharges, releases or threatened releases of pollutants, contaminants, chemicals, or industrial, toxic or hazardous substances or wastes into the environment including ambient air, surface water, ground water, or land, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handling of pollutants, contaminants, chemicals, or industrial, toxic or hazardous substances or wastes. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, together with all rules and regulations promulgated with respect thereto. “ERISA Affiliate” means Borrower and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control that, together with Borrower, are treated as a single employer under Section 414 of the Code. “ERISA Plan” means any employee pension benefit plan subject to Title IV of ERISA maintained by any ERISA Affiliate with respect to which Borrower has a fixed or contingent liability. “Event of Default” has the meaning given to such term in Section 8.1.",
"“Existing Agreements” means (i) that certain Second Amended and Restated Credit Agreement [Revolving Credit Facility] dated July 2, 2002 among Borrower and certain 7 -------------------------------------------------------------------------------- Affiliates, Fleet National Bank, as administrative agent, and the agents and lenders named therein, and (ii) that certain Second Amended and Restated Credit Agreement [Letter of Credit and Hedged Inventory Facility] dated July 2, 2003 among Borrower and certain Affiliates, Fleet National Bank, as administrative agent, and the agents and lenders named therein. “Facility Usage” means, at the time in question, the aggregate amount of Loans and LC Obligations with respect to Letters of Credit outstanding at such time. “Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/1000th of one percent) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (i) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average rate quoted to Administrative Agent on such day on such transactions as determined by Administrative Agent. “Financed Hedged Eligible Inventory” means all Hedged Eligible Inventory that one or more Lenders have (i) committed to participate in letters of credit to secure the purchase of such Hedged Eligible Inventory pursuant to Cash and Carry Purchases and/or (ii) committed to finance (a) the purchase of such Hedged Eligible Inventory pursuant to Cash and Carry Purchases or (b) the storage of such Hedged Eligible Inventory at Approved Locations.",
"“First Purchase Crude Payables” means the unpaid amount of any payable obligation related to the purchase of Petroleum Products by Borrower secured by a statutory Lien, including but not limited to the statutory Liens, if any, created under the laws of Texas, New Mexico, Wyoming, Kansas, Oklahoma or any other state to the extent such payable obligation is not at the time in question covered by a Letter of Credit. “Fiscal Quarter” means a three-month period ending on March 31, June 30, September 30 or December 31 of any year. “Fiscal Year” means a twelve-month period ending on December 31 of any year. “Funding Date” has the meaning given to such term in Section 2.1(a). “GAAP” means those generally accepted accounting principles and practices which are recognized as such by the Financial Accounting Standards Board (or any generally recognized successor) and which, in the case of Borrower and its Consolidated Subsidiaries, are applied for all periods after the date hereof in a manner consistent with the manner in which such principles and practices were applied to the Initial Financial Statements. If any change in any accounting principle or practice is required by the Financial Accounting Standards Board (or any such successor) in order for such principle or practice to continue as a generally accepted accounting principle or practice, all reports and financial statements required hereunder with respect to 8 -------------------------------------------------------------------------------- Borrower or with respect to Borrower and its Consolidated Subsidiaries may be prepared in accordance with such change, but all calculations and determinations to be made hereunder may be made in accordance with such change only after notice of such change is given to each Lender and Majority Lenders agree to such change insofar as it affects the accounting of Borrower or of Borrower and its Consolidated Subsidiaries.",
"“GP Inc.” means Plains Marketing GP Inc., a Delaware corporation, the sole general partner of Borrower. “Hazardous Materials” means any substances regulated under any Environmental Law, whether as pollutants, contaminants, or chemicals, or as industrial, toxic or hazardous substances or wastes, or otherwise. “Hedged Eligible Inventory” means Petroleum Products scheduled to be purchased by Borrower in the month following delivery of a Financing Request-Initial specified as Hedged Eligible Inventory therein, which has been hedged by either a NYMEX contract, an OTC contract or a contract for physical delivery to an investment-grade counterparty or other counterparty Currently Approved by Majority Lenders and which, upon such purchase by Borrower, shall qualify as Eligible Inventory.",
"“Hedged Value” means, as to Hedged Eligible Inventory specified in a Financing Request-Initial or Financing Request-Final and the corresponding Hedging Contract or Hedging Contracts with respect thereto, an amount equal to the volume of such Hedged Eligible Inventory times the prices fixed in such corresponding hedge, minus (i) all related storage, transportation and other applicable costs of such Hedged Eligible Inventory, as set forth therein and (ii) the amount secured by any Broker Liens, other than Broker Liens on margin deposits with respect to such corresponding Hedging Contracts. “Hedging Contract” means (a) any agreement providing for options, swaps, floors, caps, collars, forward sales or forward purchases involving interest rates, commodities or commodity prices, equities, currencies, bonds, or indexes based on any of the foregoing, (b) any option, futures or forward contract traded on an exchange, and (c) any other derivative agreement or other similar agreement or arrangement.",
"“Highest Lawful Rate” means, with respect to each Lender Party to whom Obligations are owed, the maximum nonusurious rate of interest that such Lender Party is permitted under applicable Law to contract for, take, charge, or receive with respect to such Obligations. All determinations herein of the Highest Lawful Rate, or of any interest rate determined by reference to the Highest Lawful Rate, shall be made separately for each Lender Party as appropriate to assure that the Loan Documents are not construed to obligate any Person to pay interest to any Lender Party at a rate in excess of the Highest Lawful Rate applicable to such Lender Party. “Indebtedness” of any Person means each of the following: (a) its obligations for the repayment of borrowed money, 9 -------------------------------------------------------------------------------- (b) its obligations to pay the deferred purchase price of property or services (excluding trade account payables arising in the ordinary course of business), other than contingent purchase price or similar obligations incurred in connection with an acquisition and not yet earned or determinable, (c) its obligations evidenced by a bond, debenture, note or similar instrument, (d) its obligations, as lessee, constituting principal under Capital Leases, (e) its direct or contingent reimbursement obligations with respect to the face amount of letters of credit pursuant to the applications or reimbursement agreements therefor, (f) its obligations for the repayment of outstanding banker’s acceptances, whether matured or unmatured, (g) its obligations under any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing if the obligation under such synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing is considered indebtedness for borrowed money for tax purposes but is classified as an operating lease in accordance with GAAP (excluding, to the extent included herein, operating leases entered into in the ordinary course of business), or (h) its obligations under guaranties of any obligations of any other Person described in the foregoing clauses (a) through (g).",
"“Initial Financial Statements” means (i) the audited Consolidated financial statements of PAA as of December 31, 2002, (ii) the unaudited consolidating balance sheet and income statement of PAA as of September 30, 2003, (iii) the unaudited Consolidated financial statements of Borrower as of December 31, 2002, and (iv) the unaudited consolidating balance sheet and income statement of Borrower as of September 30, 2003. “Interest Payment Date” means (a) with respect to each Base Rate Loan, the last day of each March, June, September and December beginning December 31, 2003, and (b) with respect to each LIBOR Loan, the last day of the Interest Period that is applicable thereto and, if such Interest Period is six or twelve months in length, the dates specified by Administrative Agent which are approximately three, six, and nine months (as appropriate) after such Interest Period begins; provided that the last Business Day of each calendar month shall also be an Interest Payment Date for each such Loan so long as any Event of Default exists under Section 8.1(a) or (b).",
"“Interest Period” means, with respect to each particular LIBOR Loan in a Borrowing, the period specified in the Borrowing Notice or Continuation/Conversion Notice applicable thereto, beginning on and including the date specified in such Borrowing Notice or Continuation/Conversion Notice (which must be a Business Day), and ending one, two, three, six or twelve months (if twelve months is available for each Lender) thereafter (and, as to Loans, ending on a date less than 30 days thereafter as may be specified by Borrower, if such lesser period is available for 10 -------------------------------------------------------------------------------- each Lender), as Borrower may elect in such notice; provided that: (a) any Interest Period which would otherwise end on a day which is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day; (b) any Interest Period which begins on the last Business Day in a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day in a calendar month; and (c) notwithstanding the foregoing, no Interest Period may be selected for a Loan to Borrower that would end after the Maturity Date. “Investment” means any investment made, directly or indirectly in any Person, whether by acquisition of shares of capital stock, indebtedness or other obligations or securities or by loan, advance, capital contribution or otherwise, and whether made in cash, by the transfer of property or by any other means.",
"“Law” means any statute, law, regulation, ordinance, rule, treaty, judgment, order, decree, permit, concession, franchise, license, agreement or other governmental restriction of the United States or Canada or any state, province, or political subdivision thereof or of any foreign country or any department, state, province or other political subdivision thereof. “LC Application” means any application for a Letter of Credit hereafter made by Borrower to LC Issuer. “LC-Backed Purchase Contracts” has the meaning given to such term in Section 2.1(a). “LC Collateral” has the meaning given such term in Section 2.15(a). “LC Issuer” means Fleet National Bank, in its capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity. Administrative Agent may, with the consent of Borrower and the Lender in question, appoint any Lender hereunder as an LC Issuer in place of or in addition to Fleet National Bank.",
"“LC Obligations” means, at the time in question, the sum of all Matured LC Obligations plus the maximum amounts which LC Issuer might then or thereafter be called upon to advance under all Letters of Credit then outstanding. “Lender Parties” means Administrative Agent, LC Issuer and all Lenders. “Lenders” means each signatory hereto designated as a Lender, and the successors and permitted assigns of each such party as holder of a Note. “Lender Schedule” means Schedule 1 hereto. “Letter of Credit” means any letter of credit issued by LC Issuer hereunder at the application of Borrower.",
"11 -------------------------------------------------------------------------------- “Letter of Credit Fee Rate” means, on any day, the rate per annum set forth on the Pricing Grid as the “LC Fee Rate” based on the Applicable Rating Level on such date. Changes in the applicable Letter of Credit Fee Rate will occur automatically without prior notice as changes in the Applicable Rating Level occur. Administrative Agent will give notice promptly to Borrower and Lenders of changes in the Letter of Credit Fee Rate. “Liabilities” means, as to any Person, all indebtedness, liabilities and obligations of such Person, whether matured or unmatured, liquidated or unliquidated, primary or secondary, direct or indirect, absolute, fixed or contingent, and whether or not required to be considered pursuant to GAAP.",
"“LIBOR Loan” means a Loan that bears interest at a rate based upon the LIBOR Rate. “LIBOR Rate” means, as applicable to any LIBOR Loan within a Borrowing and with respect to the related Interest Period therefor, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) as determined on the basis of offered rates for deposits in Dollars, for a period of time comparable to such Interest Period which appears on Telerate Page 3750 (or any successor page) as of 11:00 a.m. London time on the day that is two Business Days preceding the first day of such LIBOR Loan; provided, however, if the rate described above does not appear on the Telerate system on any applicable interest determination date, the LIBOR Rate shall be the rate (rounded upwards as described above, if necessary) for deposits in dollars for a period substantially equal to such Interest Period on the Reuters Page “LIBOR” (or such other page as may replace the LIBOR Page on that service for the purpose of displaying such rates), as of 11:00 a.m. (London time), on the date that is two Business Days prior to the beginning of such Interest Period; provided, however, if more than one rate is specified on Reuters Screen LIBOR Page, the applicable rate shall be the arithmetic mean of all such rates (rounded upwards, if necessary, to the nearest 1/1000 of 1%).",
"If both the Telerate and Reuters system are unavailable, then the LIBOR Rate for that date will be determined on the basis of the offered rates for deposits in Dollars for a period of time comparable to such Interest Period which are offered by four major banks in the London interbank market at approximately 11:00 a.m. London time, on the day that is two (2) Business Days preceding the first day of such LIBOR Loan as selected by Administrative Agent. The principal London office of each of the four major London banks will be requested to provide a quotation of its Dollar deposit offered rate. If at least two such quotations are provided, the rate for that date will be the arithmetic mean of the quotations. If fewer than two quotations are provided as requested, the rate for that date will be determined on the basis of the rates quoted for loans in Dollars to leading European banks for a period of time comparable to such Interest Period offered by major banks in New York City at approximately 11:00 a.m. New York City time, on the day that is two Business Days preceding the first day of such LIBOR Loan. In the event that Administrative Agent is unable to obtain any such quotation as provided above, it will be deemed that the LIBOR Rate pursuant to such LIBOR Loan cannot be determined. In the event that the Board of Governors of the Federal Reserve System shall impose a Reserve Percentage with respect to LIBOR deposits of any Lender, then for any period during which such Reserve Percentage shall apply, the LIBOR Rate shall be equal to the amount determined above divided by an amount equal to 1 minus the Reserve Percentage.",
"“Reserve Percentage” means the maximum aggregate reserve requirement (including all basic, supplemental, marginal, special, emergency and other reserves) which is imposed on member 12 -------------------------------------------------------------------------------- banks of the Federal Reserve System against “Euro-currency Liabilities” as defined in Regulation D. Without limiting the effect of the foregoing, the Reserve Percentage shall reflect any other reserves required to be maintained by such member banks with respect to (a) any category of liabilities which includes deposits by reference to which the LIBOR Rate is to be determined, or (b) any category of extensions of credit or other assets which include LIBOR Loans. The LIBOR Rate for any LIBOR Loan shall change whenever the Reserve Percentage changes. “Lien” means, with respect to any property or assets, any right or interest therein of a creditor to secure Liabilities owed to it or any other arrangement with such creditor which provides for the payment of such Liabilities out of such property or assets or which allows such creditor to have such Liabilities satisfied out of such property or assets prior to the general creditors of any owner thereof, including any lien, mortgage, security interest, pledge, deposit, production payment, rights of a vendor under any title retention or conditional sale agreement or lease substantially equivalent thereto, tax lien, mechanic’s or materialman’s lien, or any other charge or encumbrance for security purposes, whether arising by Law or agreement or otherwise, but excluding any right of offset which arises without agreement in the ordinary course of business.",
"“Lien” also means any filed financing statement, any registration of a pledge (such as with an issuer of uncertificated securities), or any other arrangement or action which would serve to perfect a Lien described in the preceding sentence, regardless of whether such financing statement is filed, such registration is made, or such arrangement or action is undertaken before or after such Lien exists. “Loan Documents” means this Agreement, the Notes, the Letters of Credit, the LC Applications, and all other agreements, certificates, documents, instruments and writings at any time delivered in connection herewith or therewith (exclusive of term sheets and commitment letters). “Loans” means loans by Participating Lenders to Borrower pursuant to Section 2.2.",
"“Majority Lenders” means Lenders whose Percentage Shares equal or exceed fifty-one percent (51%). “Material Adverse Change” means a material and adverse change, from the state of affairs presented in the Initial Financial Statements or as represented or warranted in any Loan Document, to (a) Borrower’s Consolidated financial condition, (b) Borrower’s Consolidated operations, properties or prospects, considered as a whole, (c) Borrower’s ability to timely pay its Obligations, or (d) the enforceability of the material terms of any Loan Document. “Matured LC Obligations” means all amounts paid by LC Issuer on drafts or demands for payment drawn or made under or purported to be under any Letter of Credit and all other amounts due and owing to LC Issuer under any LC Application for any such Letter of Credit, to the extent the same have not been repaid to LC Issuer (with the proceeds of Loans or otherwise).",
"13 -------------------------------------------------------------------------------- “Maturity Date” means the Settlement Date occurring in the month following the Funding Date of the Loans requested in the last Financing Request-Initial accepted by one or more Participating Lenders prior to the Request Period Termination Date. “Maximum Facility Amount” means $200,000,000, as such Maximum Facility Amount may be increased from time to time pursuant to Section 2.1(e). “Moody’s” means Moody’s Investor Service, Inc., or its successor. “Notes” has the meaning given such term in Section 2.2 hereof. “NYMEX” means the New York Mercantile Exchange. “Obligations” means all Liabilities from time to time owing by Borrower to any Lender Party under or pursuant to any of the Notes and Letters of Credit, including all LC Obligations owing thereunder, or under or pursuant to any guaranty of the obligations of Borrower or under the Loan Documents.",
"“Obligation” means any part of the Obligations. “PAA” means Plains All American Pipeline, L.P., a Delaware limited partnership. “PAA Credit Agreement” means that certain Credit Agreement [US/Canada Facilities] of even date herewith among PAA, PMC (Nova Scotia) Company, Plains Marketing Canada, L.P., Fleet National Bank, as administrative agent, The Bank of Nova Scotia, as Canadian administrative agent, and the lenders named therein. “PAA Debt Rating” means the rating then in effect by a Rating Agency with respect to the long term senior unsecured non-credit enhanced debt of PAA. “Participating Lender” has the meaning given to such term in Section 2.1(b). “Percentage Share” means (a) when used in Sections 2.1, 2.2 or 2.6 or in any Borrowing Notice with respect to a Participating Lender, the percentage set forth opposite such Participating Lender’s name on the Lender Schedule hereto, (b) when no Letters of Credit or Loans are outstanding hereunder and no Lender has any outstanding commitment to participate in any Letters of Credit or Loans, with respect to each Lender, the percentage set forth opposite such Lender’s name on the Lender Schedule hereto, and (c) when used otherwise, with respect to each Lender, the percentage obtained by dividing (i) the sum of the unpaid principal balance of such Lender’s Loans at the time in question plus such Lender’s LC Obligations plus such Lender’s Percentage Share of any Letters of Credit or Loans which such Lender has committed to participate in pursuant to Section 2.1, by (ii) the sum of the aggregate unpaid principal balance of all Loans at such time plus the aggregate amount of LC Obligations outstanding at such time plus the aggregate amount of Letters of Credit and Loans which one or more Lenders have committed to participate in pursuant to Section 2.1.",
"“Permitted Inventory Liens” means (i) any Lien, and the amount of any Liability secured thereby, on Petroleum Products inventory imposed by any governmental authority for taxes, 14 -------------------------------------------------------------------------------- assessments or charges not yet due or the validity of which is being contested in good faith and by appropriate proceedings, if necessary, for which adequate reserves are maintained on the books of Borrower in accordance with GAAP (so long as such Lien is inchoate) or (ii) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlord’s, or other like Liens (including, without limitation, Liens on property of Borrower in the possession of storage facilities, pipelines or barges) arising in the ordinary course of business for amounts which are not more than 60 days past due or the validity of which is being contested in good faith and by appropriate proceedings, if necessary, and for which adequate reserves are maintained on the books of Borrower in accordance with GAAP. “Person” means an individual, corporation, partnership, limited liability company, association, joint stock company, trust or trustee thereof, estate or executor thereof, unincorporated organization or joint venture, Tribunal, or any other legally recognizable entity. “Petroleum Products” means crude oil, condensate, natural gas, natural gas liquids (NGL’s), liquefied petroleum gases (LPG’s), refined petroleum products or any blend thereof.",
"“Plains Terminal” means any storage terminal, tankage or facility owned by Borrower or by any Affiliate of Borrower that has executed and delivered a bailee letter in form and substance reasonably acceptable to Administrative Agent with respect to any Collateral stored at such terminal, tankage or facility. “Pricing Grid” means Schedule 3 attached hereto. “Rating Agency” means either S&P or Moody’s. “Regulation D” means Regulation D of the Board of Governors of the Federal Reserve System as from time to time in effect. “Request Period” means the period from and including the date hereof until the Request Period Termination Date (or, if earlier, the day on which any commitment of any Lender to make Loans or participate in Letters of Credit, and the obligation of LC Issuer to issue such Letters of Credit, has been terminated, or the day on which any of the Notes first becomes due and payable in full).",
"“Request Period Termination Date” means November 21, 2004, as such date may be extended pursuant to Section 2.9. “Restriction Exception” means (i) any applicable Law or any instrument governing Indebtedness or equity interests, or any applicable Law or any other agreement relating to any property, assets or operations of a Person whose capital stock or other equity interests are acquired, in whole or part, by Borrower pursuant to an acquisition (whether by merger, consolidation, amalgamation or otherwise), as such instrument or agreement is in effect at the time of such acquisition (except with respect to Indebtedness incurred in connection with, or in contemplation of, such acquisition), or such applicable Law is then or thereafter in effect (as applicable), which is not applicable to Borrower, or the property, assets or operations of 15 -------------------------------------------------------------------------------- Borrower, other than the acquired Person, or the property, assets or operations of such acquired Person or such acquired Person’s Subsidiaries; provided that in the case of Indebtedness, the incurrence of such Indebtedness is not prohibited hereunder, or (ii) provisions with respect to the disposition or distribution of assets in joint venture agreements or other similar agreements entered into in the ordinary course of business.",
"“S&P” means Standard & Poor’s Ratings Group (a division of McGraw Hill, Inc.) or its successor. “Sale/Storage Month” has the meaning given to such term in Section 2.1(a). “Sale Value” means, as to Hedged Eligible Inventory specified in a Financing Request-Final and the corresponding sales contracts with respect thereto, an amount equal to the volumes of such Hedged Eligible Inventory times the sale price (or the Hedged Value of stored Hedged Eligible Inventory not subject to sales contracts) with respect to which Lenders are financing the Cash and Carry Purchase (or refinancing the storage) thereof, minus all related storage, transportation and other applicable costs, as set forth therein. “Security Documents” means the instruments listed in the Security Schedule and all other security agreements, chattel mortgages, pledges, financing statements, continuation statements, extension agreements and other agreements or instruments now, heretofore, or hereafter delivered by Borrower to Administrative Agent in connection with this Agreement or any transaction contemplated hereby to secure or guarantee the payment of any part of the Obligations or the performance of Borrower’s other duties and obligations under the Loan Documents. “Security Schedule” means Schedule 3 hereto.",
"“Settlement Date” means the US crude oil monthly settlement date, occurring on or about the 20th day of each month. “Subsidiary” means, with respect to any Person, any corporation, association, partnership, limited liability company, joint venture, or other business or corporate entity, enterprise or organization which is directly or indirectly (through one or more intermediaries) controlled or owned more than fifty percent by such Person. “Termination Event” means (a) the occurrence with respect to any ERISA Plan of (i) a reportable event described in Sections 4043(c)(5) or (6) of ERISA or (ii) any other reportable event described in Section 4043(c) of ERISA other than a reportable event not subject to the provision for 30-day notice to the Pension Benefit Guaranty Corporation pursuant to a waiver by such corporation under Section 4043(a) of ERISA, or (b) the withdrawal of any ERISA Affiliate from an ERISA Plan during a plan year in which it was a “substantial employer” as defined in Section 4001(a)(2) of ERISA, or (c) the filing of a notice of intent to terminate any ERISA Plan or the treatment of any ERISA Plan amendment as a termination under Section 4041 of ERISA, or (d) the institution of proceedings to terminate any ERISA Plan by the Pension Benefit Guaranty Corporation under Section 4042 of ERISA, or (e) any other event or condition which 16 -------------------------------------------------------------------------------- might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any ERISA Plan.",
"“Tribunal” means any government, any arbitration panel, any court or any governmental department, commission, board, bureau, agency or instrumentality of the United States of America, the Dominion of Canada, or any state, province, commonwealth, nation, territory, possession, county, parish, town, township, village or municipality, whether now or hereafter constituted or existing. “Type” means, with respect to any Loans, the characterization of such Loans as Base Rate Loans or LIBOR Loans. “UCC” means the Uniform Commercial Code as in effect in the State of New York. Section 1.2. Exhibits and Schedules; Additional Definitions. All Exhibits and Schedules attached to this Agreement are a part hereof for all purposes.",
"Section 1.3. Amendment of Defined Instruments. Unless the context otherwise requires or unless otherwise provided herein the terms defined in this Agreement which refer to a particular agreement, instrument or document also refer to and include all renewals, extensions, modifications, amendments and restatements of such agreement, instrument or document, provided that nothing contained in this section shall be construed to authorize any such renewal, extension, modification, amendment or restatement. Section 1.4. References and Titles.",
"All references in this Agreement to Exhibits, Schedules, articles, sections, subsections and other subdivisions refer to the Exhibits, Schedules, articles, sections, subsections and other subdivisions of this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any subdivisions are for convenience only and do not constitute any part of such subdivisions and shall be disregarded in construing the language contained in such subdivisions. The words “this Agreement,” “this instrument,” “herein,” “hereof,” “hereby,” “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. The phrases “this section” and “this subsection” and similar phrases refer only to the sections or subsections hereof in which such phrases occur. The word “or” is not exclusive, and the word “including” (in its various forms) means “including without limitation.” Pronouns in masculine, feminine and neuter genders shall be construed to include any other gender, and words in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. References to an “officer” or “officers” of Borrower shall mean and include officers of such Person or the controlling management entity of such Person as provided in such Person’s organizational documents, as applicable.",
"Section 1.5. Calculations and Determinations. All calculations under the Loan Documents of interest chargeable with respect to LIBOR Loans and of fees shall be made on the basis of actual days elapsed (including the first day but excluding the last) and a year of 360 days. All other calculations of interest made under the Loan Documents shall be made on the basis of actual days elapsed (including the first day but excluding the last) and a year of 365 or 366 days, 17 -------------------------------------------------------------------------------- as appropriate. Each determination by a Lender Party of amounts to be paid under Article III or any other matters which are to be determined hereunder by a Lender Party (such as any LIBOR Rate, Business Day, Interest Period, or Reserve Percentage) shall, in the absence of manifest error, be conclusive and binding.",
"Unless otherwise expressly provided herein or unless Majority Lenders otherwise consent all financial statements and reports furnished to any Lender Party hereunder shall be prepared and all financial computations and determinations pursuant hereto shall be made in accordance with GAAP. ARTICLE II - Loans and Letters of Credit Section 2.1. Financing Requests, Commitments and Fundings. (a) Borrower Financing Requests. During the Request Period, Borrower may, not later than 12:00 noon, Eastern time on the third Business Day prior to the end of each calendar month, submit to Lenders a Financing Request-Initial in the form of Exhibit B-1 (i) specifying volumes of Hedged Eligible Inventory to be subject to Cash and Carry Purchases in the month (the “Delivery Month”) following the month Borrower submits such corresponding Financing Request-Initial, or stored at and to remain stored at Approved Locations during the Delivery Month, including hedged price, Hedged Value and Approved Locations where such Hedged Eligible Inventory is to be delivered and/or stored during the Delivery Month, (ii) specifying the Hedging Contracts (including Master ISDA Agreements, counterparties and confirmations thereunder) covering such Hedged Eligible Inventory, and (iii) to the extent available, listing any corresponding sale contracts (with purchaser, date, volumes, prices, delivery dates and such other identifying information as Administrative Agent may reasonably request) pursuant to which Borrower has contracted to sell such Hedged Eligible Inventory, or otherwise specifying the Approved Locations where such Hedged Eligible Inventory is to be sold from and/or stored in the month following the Delivery Month (the “Sale/Storage Month”).",
"Pursuant to such Financing Request-Initial, Borrower may request Lenders to commit to make pro rata advances on the Settlement Date for the Delivery Month (the “Funding Date”) of up to 90% of the lesser of (x) the Sale Value of such Hedged Eligible Inventory and (y) 110% of the Hedged Value of such Hedged Eligible Inventory, to fund the purchase of such Hedged Eligible Inventory or to refinance such stored Hedged Eligible Inventory, which commitment shall include Lenders’ participation on a pro rata basis in letters of credit, in an amount not to exceed 90% of the Hedged Value of such Hedged Eligible Inventory, to secure the purchase of such Hedged Eligible Inventory, if Borrower shall at its sole option so elect prior to such Funding Date. (b) Lender Evaluation of Financing Requests-Initial. Each Lender shall independently evaluate each Financing Request-Initial and related contracts and shall determine, in its sole and absolute discretion, whether or not it desires to commit to such requested financing. Each Lender shall notify Agent by 12:00 noon, Eastern time on the second Business Day following such Financing Request-Initial as to whether or not such Lender is willing to commit to such requested financing, and Agent shall promptly thereafter notify Borrower of each Lender’s response with respect to Borrower’s Financing Request-Initial.",
"18 -------------------------------------------------------------------------------- No Lender shall have any commitment or obligation to commit to any requested financing, participate in any Letter of Credit and/or make any Loan hereunder unless and until such Lender affirmatively commits to such requested financing. Nothing contained herein shall otherwise commit or obligate any Lender, or be interpreted as a promise or commitment by any Lender to make or elect to make any such Loan or participate or elect to participate in any such Letter of Credit. Once a Lender affirmatively commits to a requested financing (a “Participating Lender”), such commitment shall be binding on such Participating Lender with respect to, but only with respect to, such requested financing, and shall not bind such Participating Lender to participate in any subsequent requested financing.",
"Furthermore, notwithstanding a Participating Lender’s commitment to a requested financing, such Participating Lender shall have no commitment or obligation to participate in such requested financing in an amount in excess of its Percentage Share of such requested financing or in an amount that would cause such Lender’s outstanding Loans and Percentage Share of LC Obligations to exceed such Lender’s Percentage Share of the Maximum Facility Amount. At Borrower’s election, Borrower may subsequently request Participating Lenders with respect to any Financing Request-Initial to increase their commitments with respect to such Financing Request-Initial in an amount not to exceed the aggregate Percentage Share of any Lenders declining to participate in such Financing Request-Initial. No Participating Lender shall have any commitment or obligation to participate in such requested increase. In the event a Participating Lender affirmatively commits to any such requested increase, such Participating Lender’s corresponding commitments to participate in Letters of Credit and Loans with respect thereto pursuant to Section 2.1(c) and 2.1(d) shall be increased accordingly. (c) Letters of Credit Securing LC-Backed Purchase Contracts.",
"With respect to a Financing Request-Initial, if one or more Participating Lenders shall have committed to participate in the requested financing, the LC Issuer shall, at Borrower’s request prior to the applicable Funding Date, issue one or more Letters of Credit pursuant to Section 2.10, naming the sellers of such Hedged Eligible Inventory under such purchase contracts as Borrower may specify (“LC-Backed Purchase Contracts”), as beneficiaries, in an amount equal to the aggregate Percentage Share of Participating Lenders times the requested face amount of such Letters of Credit; provided, Borrower shall specify to Administrative Agent the seller, date, volumes, prices, delivery dates and such other identifying information as Administrative Agent may reasonably request with respect to each such LC-Backed Purchase Contract. Each such Letter of Credit shall by its terms identify the specific LC-Backed Purchase Contracts to which it relates and shall automatically reduce upon receipt by the beneficiary thereof of any payments made by Borrower to such beneficiary for such Hedged Eligible Inventory referencing such Letter of Credit. 19 -------------------------------------------------------------------------------- (d) Loans to Finance Cash and Carry Purchases/Storage of Hedged Eligible Inventory.",
"With respect to a Financing Request-Initial, if one or more Participating Lenders shall have committed to finance Cash and Carry Purchases of Hedged Eligible Inventory (or refinance the storage of Hedged Eligible Inventory), Borrower shall, prior to the end of the applicable Delivery Month, submit to Lenders a Financing Request-Final in the form of Exhibit B-2 with respect to such Hedged Eligible Inventory pursuant to Section 2.3(a) listing the corresponding sale contracts (with purchaser, date, volumes, prices, delivery dates and such other identifying information as Administrative Agent may reasonably request) pursuant to which Borrower will sell such Hedged Eligible Inventory during the applicable Sale/Storage Month, including specifying volumes, sale price and Sale Value, or (b) Approved Locations where such Hedged Eligible Inventory is to be stored during the applicable Sale/Storage Month, with volumes, hedged price and Hedged Value. On the applicable Funding Date, each Participating Lender shall make its Loan pursuant to Section 2.2, net of any prior Loans by such Participating Lender due and payable on such Funding Date, and Administrative Agent shall (i) net against such aggregate Loans the aggregate amount of any other Loans due and payable on such Funding Date, (ii) repay such matured Loans to the Lenders thereof and (iii) make the balance available to Borrower pursuant to Section 2.3.",
"(e) Increase of Maximum Facility Amount. Borrower shall have the right, without the consent of the Lenders but with the prior approval of the Administrative Agent, not to be unreasonably withheld, to cause from time to time an increase in the Maximum Facility Amount by adding to this Agreement one or more additional Lenders or by allowing one or more Lenders to increase their portion of the Maximum Facility Amount; provided however (i) no Event of Default shall have occurred hereunder which is continuing, (ii) no such increase shall result in the Maximum Facility Amount to exceed $300,000,000, and (iii) no Lender’s portion of the Maximum Facility Amount shall be increased without such Lender’s consent.",
"Section 2.2. Loans and Notes. Subject to the terms and conditions hereof, each Participating Lender with respect to a Financing Request-Initial and corresponding Financing Request-Final and Borrowing Notice agrees to make a Loan to Borrower on the Funding Date corresponding thereto in an amount equal to such Participating Lender’s Percentage Share of the lesser of (x) 90% of the Sale Value and (y) 110% of the Hedged Value of the Hedged Eligible Inventory described therein; provided that (a) subject to Sections 3.3, 3.4 and 3.6, all such Participating Lenders are requested to make Loans of the same Type in accordance with their respective Percentage Shares and as part of the same Borrowing, (b) after giving effect to such Loans (and the repayment of any outstanding Loans on such date pursuant to netting with respect thereto as set forth in the last sentence of Section 2.1(d)), the Facility Usage does not exceed the Maximum Facility Amount determined as of the date on which the requested Loans are to be made, and (c) after giving effect to such Loans (and the repayment of any outstanding Loans on such date pursuant to netting with respect thereto as set forth in the last sentence of Section 2.1(d)), the Loans by such Participating Lender plus the existing LC Obligations of such Participating Lender with respect to Letters of Credit do not exceed such Lender’s Percentage Share of the Maximum Facility Amount. The aggregate amount of all Loans in any Borrowing must be equal to $2,000,000 or any higher integral multiple of $250,000. The obligation of Borrower to repay to each Lender the aggregate amount of all Loans made by such Lender to Borrower, together with interest accruing in connection therewith, shall be evidenced by a single 20 -------------------------------------------------------------------------------- promissory note (herein called such Lender’s “Note”) made by Borrower payable to the order of such Lender in the form of Exhibit A with appropriate insertions.",
"The amount of principal owing on any Lender’s Note at any given time shall be the aggregate amount of all Loans theretofore made by such Lender to Borrower minus all payments of principal theretofore received by such Lender on such Note. Interest on each Note shall accrue and be due and payable as provided herein and therein. Each Note shall be due and payable as provided herein and therein, and shall be due and payable in full on the Maturity Date. Subject to the terms and conditions of this Agreement, Borrower may borrow, repay, and reborrow under this Section 2.2. Borrower may have no more than seven Borrowings of LIBOR Loans outstanding at any time. All payments of principal and interest on the Loans shall be made in Dollars.",
"Section 2.3. Requests for Loans. Borrower must give to Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of any requested Borrowing. Each such notice constitutes a “Borrowing Notice” hereunder and must: (a) specify the corresponding Financing Request-Final, each Participating Lender therein, and (A) the aggregate amount of any such Borrowing and the Funding Date on which Base Rate Loans are to be advanced, or (B) the aggregate amount of any such Borrowing of new LIBOR Loans, the Funding Date on which such LIBOR Loans are to be advanced (which shall be the first day of the Interest Period which is to apply thereto), and the length of the applicable Interest Period; and (b) be received by Administrative Agent not later than 11:00 a.m., Boston, Massachusetts time, on (i) the day on which any such Base Rate Loans are to be made, or (ii) the third Business Day preceding the day on which any such LIBOR Loans are to be made. Each such written request or confirmation must be made in the form and substance of the “Borrowing Notice” attached hereto as Exhibit B-3, duly completed.",
"Each such telephonic request shall be deemed a representation, warranty, acknowledgment and agreement by Borrower as to the matters which are required to be set out in such written confirmation. Upon receipt of any such Borrowing Notice, Administrative Agent shall give each Lender prompt notice of the terms thereof. If all conditions precedent to such new Loans have been met, each Participating Lender therein will on the Funding Date promptly remit to Administrative Agent at its office in Boston, Massachusetts the amount of such Participating Lender’s new Loan in immediately available funds, and upon receipt of such funds, unless to its actual knowledge any conditions precedent to such Loans have been neither met nor waived as provided herein, Administrative Agent shall promptly make such Loans available to Borrower. Unless Administrative Agent shall have received prompt notice from a Participating Lender that such Participating Lender will not make available to Borrower such Lender’s new Loan, Administrative Agent may in its discretion assume that such Participating Lender has made such Loan available to Administrative Agent in accordance with this section, and Administrative Agent may if it chooses, in reliance upon such assumption, make such Loan available to Borrower. If and to the extent such Participating Lender shall not so make its new Loan available to Administrative Agent, such Participating Lender and Borrower severally agree to pay or repay to Administrative Agent within three days after demand the amount of such Loan together with interest thereon, for each 21 -------------------------------------------------------------------------------- day from the date such amount was made available to Borrower until the date such amount is paid or repaid to Administrative Agent, with interest at (i) the Federal Funds Rate, if such Participating Lender is making such payment, and (ii) the interest rate applicable at the time to the other new Loans made on such date, if Borrower is making such repayment.",
"If neither such Participating Lender nor Borrower pays or repays to Administrative Agent such amount within such three-day period, Administrative Agent shall be entitled to recover from Borrower, on demand in lieu of the interest provided for in the preceding sentence, interest thereon at the Default Rate, calculated from the date such amount was made available to Borrower. The failure of any Participating Lender to make any new Loan to be made by it hereunder shall not relieve any other Participating Lender of its obligation hereunder, if any, to make its new Loan, but no Participating Lender shall be responsible for the failure of any other Participating Lender to make any new Loan to be made by such other Participating Lender.",
"All Borrowings of Loans shall be advanced in Dollars. Section 2.4. Continuations and Conversions of Existing Loans. Borrower may make the following elections with respect to Loans already outstanding: (i) to Convert, in whole or in part, Base Rate Loans to LIBOR Loans, (ii) to Convert, in whole or in part, LIBOR Loans to Base Rate Loans on the last day of the Interest Period applicable thereto, and (iii) to Continue, in whole or in part, LIBOR Loans beyond the expiration of such Interest Period by designating a new Interest Period to take effect at the time of such expiration. In making such elections, Borrower may combine existing Loans to Borrower made pursuant to separate Borrowings into one new Borrowing or divide existing Loans to Borrower made pursuant to one Borrowing into separate new Borrowings, provided that Borrower may have no more than seven Borrowings of LIBOR Loans outstanding at any time. To make any such election, Borrower must give to Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of any such Conversion or Continuation of existing Loans, with a separate notice given for each new Borrowing. Each such notice constitutes a “Continuation/Conversion Notice” hereunder and must: (i) specify the existing Loans which are to be Continued or Converted; (ii) specify (A) the aggregate amount of any Borrowing of Base Rate Loans into which such existing Loans are to be Continued or Converted and the date on which such Continuation or Conversion is to occur, or (B) the aggregate amount of any Borrowing of LIBOR Loans into which such existing Loans are to be Continued or Converted, the date on which such Continuation or Conversion is to occur (which shall be the first day of the Interest Period which is to apply to such LIBOR Loans), and the length of the applicable Interest Period; and (iii) be received by Administrative Agent not later than 11:00 a.m. Boston, Massachusetts time, on (i) the day on which any such Continuation or Conversion to Base Rate Loans is to occur, or (ii) the third Business Day preceding the day on which any such Continuation or Conversion to LIBOR Loans is to occur.",
"Each such written request or confirmation must be made in the form and substance of the “Continuation/Conversion Notice” attached hereto as Exhibit C, duly completed. Each such 22 -------------------------------------------------------------------------------- telephonic request shall be deemed a representation, warranty, acknowledgment and agreement by Borrower as to the matters which are required to be set out in such written confirmation. Upon receipt of any such Continuation/Conversion Notice, Administrative Agent shall give each Lender prompt notice of the terms thereof. Each Continuation/Conversion Notice shall be irrevocable and binding on Borrower. During the continuance of any Default, Borrower may not make any election to Convert existing Loans into LIBOR Loans or Continue existing Loans as LIBOR Loans beyond the expiration of their respective and corresponding Interest Period then in effect. If (due to the existence of a Default or for any other reason) Borrower fails to timely and properly give any Continuation/Conversion Notice with respect to a Borrowing of existing LIBOR Loans at least three days prior to the end of the Interest Period applicable to such LIBOR Loans, any such LIBOR Loans, to the extent not prepaid at the end of such Interest Period, shall automatically be Converted into Base Rate Loans at the end of such Interest Period.",
"No new funds shall be repaid by Borrower or advanced by any Lender in connection with any Continuation or Conversion of existing Loans pursuant to this section, and no such Continuation or Conversion shall be deemed to be a new advance of funds for any purpose; such Continuations and Conversions merely constitute a change in the interest rate applicable to such already outstanding Loans. Section 2.5. Use of Proceeds. Borrower shall use all Loans to finance Cash and Carry Purchases of Hedged Eligible Inventory and to refinance Matured LC Obligations. Any Loans used to purchase Hedged Eligible Inventory under LC-Backed Purchase Contracts shall be used by Borrower on the Funding Date to pay the sellers thereunder, with reference in each case to the outstanding Letter of Credit issued with respect to such LC-Backed Purchase Contract, and Borrower shall provide documentation to Administrative Agent with respect thereto. Borrower shall use all Letters of Credit solely for the purposes set forth in Section 2.10(d). In no event shall the funds from any Loans or any Letters of Credit be used directly or indirectly by any Person for personal, family, household or agricultural purposes or for the purpose, whether immediate, incidental or ultimate, of purchasing, acquiring or carrying any “margin stock” (as such term is defined in Regulation U promulgated by the Board of Governors of the Federal Reserve System) or to extend credit to others directly or indirectly for the purpose of purchasing or carrying any such margin stock.",
"Borrower represents and warrants that it is not engaged principally, or as one of its important activities, in the business of extending credit to others for the purpose of purchasing or carrying such margin stock. Section 2.6. Interest Rates and Fees. (a) Interest Rates. (i) Each Loan shall bear interest as follows: (A) unless the Default Rate shall apply, each Base Rate Loan shall bear interest on each day outstanding at the Base Rate plus the Applicable Margin in effect on such day, and each LIBOR Loan shall bear interest on each day during the related Interest Period at the related LIBOR Rate plus the Applicable Margin in effect on such day, and (B) during a Default Rate Period, all Loans shall bear interest on each day outstanding at the applicable Default Rate. 23 -------------------------------------------------------------------------------- (ii) If an Event of Default based upon Section 8.1(a), Section 8.1(b) or Section 8.1(h)(i), (h)(ii) or (h)(iii) exists and the Loans are not bearing interest at the Default Rate, the past due principal and past due interest shall bear interest on each day outstanding at the applicable Default Rate. (iii) The interest rate shall change whenever the applicable Base Rate, LIBOR Rate or Applicable Margin changes. In no event shall the interest rate on any Loan exceed the Highest Lawful Rate. (b) Facility Fee.",
"In consideration of Lenders’ agreement to consider financing requests of Borrower hereunder, Borrower agrees to pay to Administrative Agent for the account of each Lender in proportion to its Percentage Share, a facility fee equal to one-twentieth percent (0.05%) of the Maximum Facility Amount, due and payable on the date hereof. (c) Administrative Agent’s Fees. In addition to all other amounts due to Administrative Agent under the Loan Documents, Borrower will pay fees to Administrative Agent as described in the fee letter dated October 20, 2003 between Administrative Agent and Borrower. Section 2.7. Optional Prepayments. Borrower may, upon three Business Days’ notice, as to LIBOR Loans, or same Business Day’s notice, as to Base Rate Loans, to Administrative Agent (and Administrative Agent will promptly give notice to the other Lenders) from time to time and without premium or penalty prepay the Loans, in whole or in part, so long as the aggregate amounts of all partial prepayments of principal on the Loans equals $2,500,000 or any higher integral multiple of $250,000.",
"Upon receipt of any such notice, Administrative Agent shall give each Lender prompt notice of the terms thereof. Each prepayment of principal of a Loan under this section shall be accompanied by all interest then accrued and unpaid on the principal so prepaid. Any principal or interest prepaid pursuant to this section shall be in addition to, and not in lieu of, all payments otherwise required to be paid under the Loan Documents at the time of such prepayment. Following notice by Borrower pursuant to the foregoing, Borrower shall make such prepayment, and the prepayment amount specified in such notice shall be due and payable, on the date specified in such notice.",
"Section 2.8. Mandatory Prepayments and Payments. (a) If at any time the Facility Usage exceeds the Maximum Facility Amount, Borrower shall immediately upon demand prepay the principal of the Loans in an amount at least equal to such excess. Each prepayment of principal under this section shall be accompanied by all interest then accrued and unpaid on the principal so prepaid. Any principal or interest prepaid pursuant to this section shall be in addition to, and not in lieu of, all payments otherwise required to be paid under the Loan Documents at the time of such prepayment. (b) If any contract pursuant to which the Sale Value of any Hedged Eligible Inventory is modified, sold or exchanged in any way that would negatively affect the Sale Value of such Hedged Eligible Inventory following the delivery of the Financing Request-Final with respect thereto, Borrower shall immediately (i) notify Administrative Agent of such decreased Sale Value, and the Financing Request-Final shall be deemed supplemented thereby, and (ii) prepay 24 -------------------------------------------------------------------------------- any outstanding Loans with respect to such Hedged Eligible Inventory in an amount equal to 90% of such decrease in Sale Value. (c) Each Loan by a Participating Lender hereunder shall constitute a term loan due and payable on the Settlement Date occurring in the month next following the month in which such Loan was funded, accompanied by all interest then accrued and unpaid on such Loan.",
"(d) On the Request Period Termination Date (i) any outstanding Letters of Credit shall continue to be outstanding according to their terms until their expiration or retirement/cancellation pursuant to a related Loan as set forth herein, (ii) any outstanding Loans shall be due and payable as set forth in Section 2.8(c) above, and (iii) any commitments to participate in Letters of Credit or make Loans for Cash and Carry Purchases of Hedged Eligible Inventory, and any Letters of Credit issued or Loans made thereafter pursuant thereto, shall remain outstanding as set forth herein; provided, all such commitments, Letters of Credit and Loans shall be terminated, cancelled or paid in full on or before the Maturity Date. Section 2.9. Extension of Request Period. (a) Borrower may, at its option and from time to time during the Request Period, request that Lenders extend the Request Period Termination Date by delivering to Administrative Agent a written request made by Borrower to each Lender to extend the Request Period Termination Date for an additional year not more than forty-five days and not less than thirty days prior to the then current Request Period Termination Date.",
"Administrative Agent shall forthwith provide a copy of the request to each Lender. Upon receipt from Administrative Agent of such request, each Lender shall, within fifteen days after the date of such Lender’s receipt of such request from Administrative Agent, notify Administrative Agent of its acceptance (and the terms and conditions, if any, upon which such Lender is prepared to extend the Request Period Termination Date) or rejection of such request. The failure of a Lender to so notify Administrative Agent within such twenty day period shall be deemed to be notification by such Lender to Administrative Agent that such Lender has denied such request. (b) Following any Lender’s or Lenders’ notice to Administrative Agent pursuant to Section 2.9(a) that such Lender or Lenders accept such request, such acceptance having common terms and conditions, Administrative Agent shall deliver to Borrower such offer incorporating the said terms and conditions.",
"Such offer shall be open for acceptance by Borrower until the fifth Business Day immediately preceding the then current Request Period Termination Date. Upon written notice by Borrower to Administrative Agent accepting such offer and agreeing to the terms and conditions, if any, specified therein (the date of such notice of acceptance being called the “Extension Date”), the Request Period Termination Date shall be extended to the date one year from the Extension Date and the terms and conditions specified in such offer shall be immediately effective. (c) Upon Borrower’s acceptance of Lenders’ offer to extend the Request Period Termination Date, any Lender that rejected Borrower’s extension request shall have no obligation to evaluate any Financing Request-Initial received on or after the Extension Date, but any such Lender that is a Participating Lender with respect to any previously approved Financing Request- 25 -------------------------------------------------------------------------------- Initial shall be obligated to participate in Letters of Credit issued after the Extension Date pursuant to such approved Financing Request-Initial and/or make Loans after the Extension Date pursuant to such approved Financing Request-Initial.",
"(d) Borrower understands that the consideration of any request constitutes an independent credit decision which each Lender retains the absolute and unfettered discretion to make and that no commitment in this regard is hereby given by a Lender and that any offer to extend the Request Period Termination Date may be on such terms and conditions in addition to those set out herein as the extending Lenders stipulate. Section 2.10. Letters of Credit. Subject to the terms and conditions hereof, Borrower may request LC Issuer to issue any Letter of Credit that Participating Lenders have agreed to participate in pursuant to and subject to the terms of Section 2.1(c) (or amend, or extend the expiration date of, one or more such Letters of Credit), provided that, after taking such Letter of Credit (or amendment or extension) into account: (a) the Facility Usage does not exceed the Maximum Facility Amount; (b) the face amount of such Letter of Credit does not exceed the aggregate Percentage Share of Participating Lenders with respect to such Letter of Credit times ninety percent (90%) of the Hedged Value of the Hedged Eligible Inventory subject to the Cash and Carry Purchase thereof pursuant to the LC-Backed Purchase Contract secured by such Letter of Credit; (c) the expiration date of such Letter of Credit is prior to 70 days after the date of issuance of such Letter of Credit; (d) such Letter of Credit is used to secure the Cash and Carry Purchase by Borrower of Hedged Eligible Inventory pursuant to an LC-Backed Purchase Contract and is substantially in the form of Exhibit E hereto or such other form and terms as shall be acceptable to LC Issuer in its sole and absolute discretion; (e) the issuance of such Letter of Credit will be in compliance with all applicable governmental restrictions, policies, and guidelines and will not subject LC Issuer to any cost which is not reimbursable under Article III; and (f) all other conditions in this Agreement to the issuance of such Letter of Credit have been satisfied.",
"LC Issuer will honor any such request if the foregoing conditions (a) through (f) (in the following Section 2.11 called the “LC Conditions”) have been met as of the date of issuance, amendment, or extension of the expiration, of such Letter of Credit. Letters of Credit shall be issued in Dollars. Section 2.11. Requesting Letters of Credit. Borrower must make written application for any Letter of Credit at least two Business Days before the date on which Borrower desires for LC Issuer to issue such Letter of Credit. By making any such written application, unless otherwise 26 -------------------------------------------------------------------------------- expressly stated therein, Borrower shall be deemed to have represented and warranted that the LC Conditions described in Section 2.10 will be met as of the date of issuance of such Letter of Credit. Each such written application for a Letter of Credit must be made in writing in the form and substance of Exhibit F, and the terms and provisions of which are hereby incorporated herein by reference (or in such other form as may mutually be agreed upon by LC Issuer and Borrower). If all LC Conditions for a Letter of Credit have been met as described in Section 2.10 on any Business Day before 11:00 a.m. Boston, Massachusetts time, LC Issuer will issue such Letter of Credit on the same Business Day at LC Issuer’s office in Boston, Massachusetts.",
"If the LC Conditions are met as described in Section 2.10 on any Business Day on or after 11:00 a.m. Boston, Massachusetts time, LC Issuer will issue such Letter of Credit on the next succeeding Business Day at LC Issuer’s office in Boston, Massachusetts. If any provisions of any LC Application conflict with any provisions of this Agreement, the provisions of this Agreement shall govern and control. Section 2.12. Reimbursement and Participations. (a) Reimbursement by Borrower. Each Matured LC Obligation shall constitute a loan by LC Issuer to Borrower. Borrower promises to pay to LC Issuer, or to LC Issuer’s order, on demand, the full amount of each Matured LC Obligation, together with interest thereon (i) at the Base Rate plus the Applicable Margin to and including the second Business Day after the Matured LC Obligation is incurred and (ii) at the Default Rate on each day thereafter.",
"(b) Letter of Credit Advances. If the beneficiary of any Letter of Credit makes a draft or other demand for payment thereunder then Borrower may, during the interval between the making thereof and the honoring thereof by LC Issuer, request Lenders to make Loans to Borrower in the amount of such draft or demand, which Loans shall be made concurrently with LC Issuer’s payment of such draft or demand and shall be immediately used by LC Issuer to repay the amount of such resulting Matured LC Obligation.",
"Such a request by Borrower shall be made in compliance with all of the provisions hereof, provided that for the purposes of the first sentence of Section 2.1, the amount of such Loans shall be considered, but the amount of the Matured LC Obligation to be concurrently paid by such Loans shall not be considered. (c) Participation by Lenders. LC Issuer irrevocably agrees to grant and hereby grants to each Lender, and — to induce LC Issuer to issue Letters of Credit hereunder — each Lender irrevocably agrees to accept and purchase and hereby accepts and purchases from LC Issuer, on the terms and conditions hereinafter stated and for such Lender’s own account and risk an undivided interest equal to such Lender’s Percentage Share of LC Issuer’s obligations and rights under each Letter of Credit issued hereunder and the amount of each Matured LC Obligation paid by LC Issuer thereunder. Each Lender unconditionally and irrevocably agrees with LC Issuer that, if a Matured LC Obligation is paid under any Letter of Credit for which LC Issuer is not reimbursed in full by Borrower in accordance with the terms of this Agreement and the related LC Application (including any reimbursement by means of concurrent Loans or by the application of LC Collateral), such Lender shall (in all circumstances and without set-off or counterclaim) pay to LC Issuer, on demand, in immediately available funds at such LC Issuer’s address for notices hereunder, such Lender’s Percentage Share of such Matured LC Obligation (or any portion thereof which has not been reimbursed by Borrower).",
"Each Lender’s obligation to 27 -------------------------------------------------------------------------------- pay LC Issuer pursuant to the terms of this subsection is irrevocable and unconditional. If any amount required to be paid by any Lender to LC Issuer pursuant to this subsection is paid by such Lender to LC Issuer within three Business Days after the date such payment is due, LC Issuer shall in addition to such amount be entitled to recover from such Lender, on demand, interest thereon calculated from such due date at the Federal Funds Rate. If any amount required to be paid by any Lender to LC Issuer pursuant to this subsection is not paid by such Lender to LC Issuer within three Business Days after the date such payment is due, LC Issuer shall in addition to such amount be entitled to recover from such Lender, on demand, interest thereon calculated from such due date at the Base Rate plus the Applicable Margin.",
"(d) Distributions to Participants. Whenever LC Issuer has in accordance with this section received from any Lender payment of such Lender’s Percentage Share of any Matured LC Obligation, if LC Issuer thereafter receives any payment of such Matured LC Obligation or any payment of interest thereon (whether directly from Borrower or by application of LC Collateral or otherwise, and excluding only interest for any period prior to LC Issuer’s demand that such Lender make such payment of its Percentage Share), LC Issuer will distribute to such Lender its Percentage Share of the amounts so received by LC Issuer; provided, however, that if any such payment received by LC Issuer must thereafter be returned by LC Issuer, such Lender shall return to LC Issuer the portion thereof which LC Issuer has previously distributed to it. (e) Calculations. A written advice setting forth in reasonable detail the amounts owing under this section, submitted by LC Issuer to the Borrower or any Lender from time to time, shall be conclusive, absent manifest error, as to the amounts thereof. Section 2.13. Letter of Credit Fees.",
"In consideration of LC Issuer’s issuance of any Letter of Credit, Borrower agrees to pay (i) to Administrative Agent for the account of each Lender in proportion to its Percentage Share, a Letter of Credit fee equal to the Letter of Credit Fee Rate applicable each day times the undrawn face amount of such Letter of Credit and (ii) to LC Issuer for its own account, a letter of credit fronting fee at a rate equal to one-eighth percent (.125%) per annum times the undrawn face amount of such Letter of Credit.",
"Each such fee will be calculated on the undrawn face amount of each Letter of Credit outstanding on each day at the above applicable rates and will be payable quarterly in arrears on the last day of each March, June, September and December. In addition, Borrower will pay to LC Issuer a minimum administrative issuance fee and such other fees and charges customarily charged by LC Issuer in respect of any issuance, amendment or negotiation of any Letter of Credit requested by Borrower in accordance with LC Issuer’s published schedule of such charges effective as of the date of such amendment or negotiation. 28 -------------------------------------------------------------------------------- Section 2.14. No Duty to Inquire. (a) Drafts and Demands. LC Issuer is authorized and instructed to accept and pay drafts and demands for payment under any Letter of Credit without requiring, and without responsibility for, any determination as to the existence of any event giving rise to said draft, either at the time of acceptance or payment or thereafter. LC Issuer is not under any duty to determine the proper identity of anyone presenting such a draft or making such a demand (whether by tested telex or otherwise) as the officer, representative or agent of any beneficiary under any Letter of Credit, and payment by LC Issuer to any such beneficiary when requested by any such purported officer, representative or agent is hereby authorized and approved.",
"Borrower releases each Lender Party from, and agrees to hold each Lender Party harmless and indemnified against, any liability or claim in connection with or arising out of the subject matter of this section, which indemnity shall apply whether or not any such liability or claim is in any way or to any extent caused, in whole or in part, by any negligent act or omission of any kind by any Lender Party, provided only that no Lender Party shall be entitled to indemnification for that portion, if any, of any liability or claim which is proximately caused by its own individual gross negligence or willful misconduct, as determined in a final judgment. (b) Extension of Maturity. If the maturity of any Letter of Credit is extended by its terms or by Law or governmental action, if any extension of the maturity or time for presentation of drafts or any other modification of the terms of any Letter of Credit is made at the request of Borrower, or if the amount of any Letter of Credit is increased at the request of Borrower, this Agreement shall be binding upon Borrower with respect to such Letter of Credit as so extended, increased or otherwise modified, with respect to drafts and property covered thereby, and with respect to any action taken by LC Issuer, LC Issuer’s correspondents, or any Lender Party in accordance with such extension, increase or other modification. (c) Transferees of Letters of Credit.",
"If any Letter of Credit provides that it is transferable, LC Issuer shall have no duty to determine the proper identity of anyone appearing as transferee of such Letter of Credit, nor shall LC Issuer be charged with responsibility of any nature or character for the validity or correctness of any transfer or successive transfers, and payment by LC Issuer to any purported transferee or transferees as determined by LC Issuer is hereby authorized and approved, and Borrower releases each Lender Party from, and agrees to hold each Lender Party harmless and indemnified against, any liability or claim in connection with or arising out of the foregoing, which indemnity shall apply whether or not any such liability or claim is in any way or to any extent caused, in whole or in part, by any negligent act or omission of any kind by any Lender Party, provided only that no Lender Party shall be entitled to indemnification for that portion, if any, of any liability or claim which is proximately caused by its own individual gross negligence or willful misconduct, as determined in a final judgment. Section 2.15.",
"LC Collateral. (a) LC Obligations in Excess of Maximum Facility Amount. If, after the making of all mandatory prepayments required under Section 2.8, the outstanding LC Obligations will exceed 29 -------------------------------------------------------------------------------- the Maximum Facility Amount, Borrower will immediately deposit with LC Issuer an amount equal to such excess. LC Issuer will hold such amount as collateral security for such remaining LC Obligations (all such amounts held as collateral security for LC Obligations being herein collectively called “LC Collateral”) and the other Obligations, respectively, and such collateral may be applied from time to time to any Matured LC Obligations or, if any Event of Default shall then exist, any other Obligations which are due and payable; provided, upon the reduction of such outstanding LC Obligations pursuant to the termination or cancellation of any Letter of Credit with respect thereto, LC Issuer shall release LC Collateral in an amount equal to the amount of such terminated or canceled Letter of Credit, and in the event the LC Obligations shall no longer exceed the Maximum Facility Amount LC Issuer shall release all such LC Collateral.",
"Neither this subsection nor the following subsection shall, however, limit or impair any rights which LC Issuer may have under any other document or agreement relating to any Letter of Credit, LC Collateral or LC Obligations, including any LC Application, or any rights which any Lender Party may have to otherwise apply any payments by Borrower and any LC Collateral under Section 3.1. (b) Acceleration of LC Obligations. If the Obligations or any part thereof become immediately due and payable pursuant to Section 8.1 then, unless all Lenders otherwise specifically elect to the contrary (which election may thereafter be retracted by any Lender at any time), all LC Obligations shall become immediately due and payable without regard to whether or not actual drawings or payments on the Letters of Credit have occurred, and Borrower shall be obligated to deposit with LC Issuer immediately an amount equal to the aggregate LC Obligations with respect to Letters of Credit which are then outstanding to be held as LC Collateral by LC Issuer as set forth above.",
"(c) Investment of LC Collateral. Pending application thereof, all LC Collateral shall be invested by LC Issuer in such Cash Equivalents as LC Issuer may choose in its sole discretion. All interest on (and other proceeds of) such Investments shall be reinvested or applied to Matured LC Obligations or the Loans which are due and payable. With respect to any LC Collateral delivered pursuant to clause (b) above, when all Obligations have been satisfied in full, including all LC Obligations, all Letters of Credit have expired or been terminated, and all of Borrower’s reimbursement obligations in connection therewith have been satisfied in full, LC Issuer shall release any remaining LC Collateral.",
"Borrower hereby assigns and grants to LC Issuer for the benefit of Lenders a continuing security interest in all LC Collateral paid by it to LC Issuer, all Investments purchased with such LC Collateral, and all proceeds thereof to secure its Matured LC Obligations and its Obligations under this Agreement, each Note and the other Loan Documents. Borrower further agrees that LC Issuer shall have all of the rights and remedies of a secured party under the Uniform Commercial Code as adopted in the State of New York with respect to such security interest and that an Event of Default under this Agreement shall constitute a default for purposes of such security interest. (d) Payment of LC Collateral.",
"When Borrower is required to provide LC Collateral for any reason and fails to do so on the day when required, LC Issuer or Administrative Agent may without prior notice to Borrower provide such LC Collateral (whether by transfers from other accounts maintained with LC Issuer or otherwise) using any available funds of Borrower or any other Person also liable to make such payments, and LC Issuer or Administrative Agent will give 30 -------------------------------------------------------------------------------- notice thereof to Borrower promptly after such application or transfer. Any such amounts which are required to be provided as LC Collateral and which are not provided on the date required shall be considered past due Obligations owing hereunder, and LC Issuer is hereby authorized to exercise its respective rights to obtain such amounts. ARTICLE III - Payments to Lenders Section 3.1. General Procedures. Borrower shall pay all amounts owing with respect to any Obligations (whether for principal, interest, fees, or otherwise) to Administrative Agent for the account of the Lender Party to whom such payment is owed in Dollars, without set-off, deduction or counterclaim (other than netting with respect to Loans being made on a particular date and repayment of prior Loans on such date as set forth in the last sentence of Section 2.1(d), in immediately available funds.",
"Each payment under the Loan Documents must be received by Administrative Agent not later than noon, Boston, Massachusetts time, on the date such payment becomes due and payable. Any payment received by Administrative Agent after such time will be deemed to have been made on the next following Business Day. Should any such payment become due and payable on a day other than a Business Day, the maturity of such payment shall be extended to the next succeeding Business Day, and, in the case of a payment of principal or past due interest, interest shall accrue and be payable thereon for the period of such extension as provided in the Loan Document under which such payment is due. Each payment under a Loan Document to a Lender Party shall be due and payable at the place provided therein and, if no specific place of payment is provided, shall be due and payable at the place of payment of Administrative Agent’s Note. (a) When Administrative Agent collects or receives money on account of the Obligations, Administrative Agent shall distribute all money so collected or received, and each Lender Party shall apply all such money so distributed, as follows: (i) first, for the payment of all Obligations which are then due (and if such money is insufficient to pay all such Obligations, first to any reimbursements due Administrative Agent under Section 10.4 and then to the partial payment of all other Obligations then due in proportion to the amounts thereof, or as Lender Parties shall otherwise agree); (ii) then for the prepayment of amounts owing under the Loan Documents (other than principal on the Notes) if so specified by Borrower; (iii) then for the prepayment of principal on the Notes, together with accrued and unpaid interest on the principal so prepaid, and then held as LC Collateral pursuant to Section 2.15; and (iv) last, for the payment or prepayment of any other Obligations.",
"All payments applied to principal or interest on any Note shall be applied first to any interest then due and payable, then to principal then due and payable, and last to any prepayment of principal and accrued interest thereon in compliance with Sections 2.7 and 2.8, as applicable. All distributions of amounts described in any of subsections (ii), (iii), or (iv) above shall be made by 31 -------------------------------------------------------------------------------- Administrative Agent pro rata to each Lender Party then owed Obligations described in such subsection in proportion to all amounts owed to all Lender Parties which are described in such subsection; provided that if any Lender then owes payments to LC Issuer for the purchase of a participation under Section 2.12(c) or to Administrative Agent under Section 9.4, any amounts otherwise distributable under this section to such Lender shall be deemed to belong to LC Issuer or Administrative Agent, respectively, to the extent of such unpaid payments, and Administrative Agent shall apply such amounts to make such unpaid payments rather than distribute such amounts to such Lender.",
"Section 3.2. Capital Reimbursement. If either (a) the introduction or implementation of or the compliance with or any change in or in the interpretation of any Law, or (b) the introduction or implementation of or the compliance with any request, directive or guideline from any central bank or other governmental authority (whether or not having the force of Law) affects or would affect the amount of capital required or expected to be maintained by any Lender Party or any corporation controlling any Lender Party, then, within five Business Days after demand by such Lender Party, Borrower will pay to Administrative Agent for the benefit of such Lender Party, from time to time as specified by such Lender Party, such additional amount or amounts which such Lender Party shall determine to be appropriate to compensate such Lender Party or any corporation controlling such Lender Party in light of such circumstances, to the extent that such Lender Party reasonably determines that the amount of any such capital would be increased or the rate of return on any such capital would be reduced by or in whole or in part based on the existence of the face amount of such Lender Party’s Loans, Letters of Credit, participations in Letters of Credit or commitments under this Agreement. Section 3.3.",
"Increased Cost of LIBOR Loans or Letters of Credit. If any applicable Law (whether now in effect or hereinafter enacted or promulgated, including Regulation D) or any interpretation or administration thereof by any governmental authority charged with the interpretation or administration thereof (whether or not having the force of Law): (a) shall change the basis of taxation of payments to any Lender Party of any principal, interest, or other amounts attributable to any LIBOR Loan or Letter of Credit or otherwise due under this Agreement in respect of any LIBOR Loan or Letter of Credit (other than taxes imposed on, or measured by, the overall net income of such Lender Party or any Applicable Lending Office of such Lender Party by any jurisdiction in which such Lender Party or any such Applicable Lending Office is located); or (b) shall change, impose, modify, apply or deem applicable any reserve, special deposit or similar requirements in respect of any LIBOR Loan or Letter of Credit (excluding those for which such Lender Party is fully compensated pursuant to adjustments made in the definition of LIBOR Rate) or against assets of, deposits with or for the account of, or credit extended by, such Lender Party; or (c) shall impose on any Lender Party or the interbank Eurocurrency deposit market any other condition affecting any LIBOR Loan or Letter of Credit, the result of which is to increase the cost to any Lender Party of funding or maintaining any LIBOR Loan or Letter of 32 -------------------------------------------------------------------------------- Credit or to reduce the amount of any sum receivable by any Lender Party in respect of any LIBOR Loan or Letter of Credit by an amount deemed by such Lender Party to be material, then such Lender Party shall promptly notify Administrative Agent and Borrower in writing of the happening of such event and of the amount required to compensate such Lender Party for such event (on an after-tax basis, taking into account any taxes on such compensation), whereupon (i) Borrower shall, within five Business Days after demand therefor by such Lender Party, pay such amount to Administrative Agent for the account of such Lender Party and (ii) Borrower may elect, by giving to Administrative Agent and such Lender Party not less than three Business Days’ notice, to Convert all (but not less than all) of any such LIBOR Loans into Base Rate Loans.",
"Section 3.4. Notice; Change of Applicable Lending Office. A Lender Party shall notify Borrower of any event occurring after the date of this Agreement that will entitle such Lender Party to compensation under Section 3.2, 3.3, or 3.5 hereof as promptly as practicable, but in any event within 180 days, after such Lender Party obtains actual knowledge thereof; provided, that (i) if such Lender Party fails to give such notice within 180 days after it obtains actual knowledge of such an event, such Lender Party shall, with respect to compensation payable pursuant to Section 3.2, 3.3, or 3.5 in respect of any costs resulting from such event, only be entitled to payment under Section 3.2, 3.3, or 3.5 hereof for costs incurred from and after the date 180 days prior to the date that such Lender Party does give such notice and (ii) such Lender Party will designate a different Applicable Lending Office for the Loans affected by such event if such designation will avoid the need for, or reduce the amount of, such compensation and will not, in the sole opinion of such Lender Party, be disadvantageous to such Lender Party, except that such Lender Party shall have no obligation to designate an Applicable Lending Office located in the United States of America.",
"Each Lender Party will furnish to Borrower a certificate setting forth the basis and amount of each request by such Lender Party for compensation under Section 3.2, 3.3, or 3.5 hereof. Section 3.5. Availability. If (a) any change in applicable Laws, or in the interpretation or administration thereof of or in any jurisdiction whatsoever, domestic or foreign, shall make it unlawful or impracticable for any Lender Party to fund or maintain LIBOR Loans or to issue or participate in Letters of Credit, or shall materially restrict the authority of any Lender Party to purchase or take offshore deposits of dollars (i.e., “Eurodollars”), or (b) any Lender Party determines that matching deposits appropriate to fund or maintain any LIBOR Loan are not available to it, or (c) any Lender Party determines that the formula for calculating the LIBOR Rate does not fairly reflect the cost to such Lender Party of making or maintaining loans based on such rate, with respect to the transactions contemplated hereunder, then, upon notice by such Lender Party to Borrower and Administrative Agent, Borrower’s right to elect LIBOR Loans from such Lender Party (or, if applicable, to obtain Letters of Credit) shall be suspended to the extent and for the duration of such illegality, impracticability or restriction and all LIBOR Loans of such Lender Party which are then outstanding or are then the subject of any Borrowing Notice and which cannot lawfully or practicably be maintained or funded shall immediately become or remain, or shall be funded as, Base Rate Loans of such Lender Party. With respect to any commitment of any Lender hereunder, Borrower agrees to indemnify each Lender Party extending credit pursuant thereto, and hold each such Lender Party harmless against all costs, 33 -------------------------------------------------------------------------------- expenses, claims, penalties, liabilities and damages which may result from any such change in Law, interpretation or administration.",
"Such indemnification shall be on an after-tax basis, taking into account any taxes imposed on the amounts paid as indemnity. Section 3.6. Funding Losses. In addition to its other obligations hereunder, with respect to any commitment of any Lender hereunder, Borrower will indemnify each Lender Party extending credit pursuant thereto against, and reimburse each Lender Party on demand for, any loss or expense incurred or sustained by such Lender Party (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender Party to fund or maintain LIBOR Loans), as a result of (a) any payment or prepayment (whether or not authorized or required hereunder) of all or a portion of a LIBOR Loan on a day other than the day on which the applicable Interest Period ends, (b) any payment or prepayment, whether or not required hereunder, of a Loan made after the delivery, but before the effective date, of a Continuation/Conversion Notice, if such payment or prepayment prevents such Continuation/Conversion Notice from becoming fully effective, (c) the failure of any Loan to be made or of any Continuation/Conversion Notice to become effective due to any condition precedent not being satisfied or due to any other action or inaction of Borrower, or (d) any Conversion (whether or not authorized or required hereunder) of all or any portion of any LIBOR Loan into a Base Rate Loan or into a different LIBOR Loan on a day other than the day on which the applicable Interest Period ends. Such indemnification shall be on an after-tax basis, taking into account any taxes imposed on the amounts paid as indemnity.",
"Section 3.7. Reimbursable Taxes. With respect to any commitment by any Lender hereunder, Borrower covenants and agrees with each Lender Party extending credit pursuant thereto that: (a) Borrower will indemnify each such Lender Party against and reimburse each such Lender Party for all present and future stamp and other taxes, duties, levies, imposts, deductions, charges, costs, and withholdings whatsoever imposed, assessed, levied or collected on or in respect of this Agreement, any LIBOR Loans or Letters of Credit (whether or not legally or correctly imposed, assessed, levied or collected), excluding, however, any taxes imposed on or measured by the overall net income of Administrative Agent or such Lender Party or any Applicable Lending Office of such Lender Party by any jurisdiction in which such Lender Party or any such Applicable Lending Office is located (all such non-excluded taxes, levies, costs and charges being collectively called “Reimbursable Taxes” in this section).",
"Such indemnification shall be on an after-tax basis, taking into account any taxes imposed on the amounts paid as indemnity. (b) All payments on account of the principal of, and interest on, each such Lender Party’s Loans and Note, and all other amounts payable by Borrower to any such Lender Party hereunder, shall be made in full without set-off or counterclaim and shall be made free and clear of and without deductions or withholdings of any nature by reason of any Reimbursable Taxes, all of which will be for the account of Borrower. In the event of Borrower being compelled by Law to make any such deduction or withholding from any payment to any such Lender Party, Borrower shall pay on the due date of such payment, by way of additional interest, such additional amounts as are needed to cause the amount receivable by such Lender Party after such deduction or 34 -------------------------------------------------------------------------------- withholding to equal the amount which would have been receivable in the absence of such deduction or withholding.",
"If Borrower should make any deduction or withholding as aforesaid, Borrower shall within 60 days thereafter forward to such Lender Party an official receipt or other official document evidencing payment of such deduction or withholding. (c) If Borrower is ever required to pay any Reimbursable Tax with respect to any LIBOR Loan, Borrower may elect, by giving to Administrative Agent and such Lender Party not less than three Business Days’ notice, to Convert all (but not less than all) of any such LIBOR Loan into a Base Rate Loan, but such election shall not diminish Borrower’s obligation to pay all Reimbursable Taxes. (d) Notwithstanding the foregoing provisions of this section, Borrower shall be entitled, to the extent it is required to do so by Law, to deduct or withhold (and not to make any indemnification or reimbursement for) income or other similar taxes imposed by the United States of America (other than any portion thereof attributable to a change in federal income tax Laws effected after the date hereof) from interest, fees or other amounts payable hereunder for the account of such Lender Party, other than such a Lender Party (i) who is a US person for Federal income tax purposes or (ii) who has the Prescribed Forms on file with Administrative Agent (with copies provided to the relevant Borrower) for the applicable year to the extent deduction or withholding of such taxes is not required as a result of the filing of such Prescribed Forms, provided that if Borrower shall so deduct or withhold any such taxes, it shall provide a statement to Administrative Agent and such Lender Party, setting forth the amount of such taxes so deducted or withheld, the applicable rate and any other information or documentation which such Lender Party may reasonably request for assisting such Lender Party to obtain any allowable credits or deductions for the taxes so deducted or withheld in the jurisdiction or jurisdictions in which such Lender Party is subject to tax.",
"As used in this section, “Prescribed Forms” means such duly executed forms or statements, and in such number of copies, which may, from time to time, be prescribed by Law and which, pursuant to applicable provisions of (x) an income tax treaty between the United States and the country of residence of such Lender Party providing the forms or statements, (y) the Code, or (z) any applicable rules or regulations thereunder, permit Borrower to make payments hereunder for the account of such Lender Party free of such deduction or withholding of income or similar taxes. Section 3.8. Replacement of Lenders. If any Lender Party seeks reimbursement for increased costs under Sections 3.2 through 3.7, then within ninety days thereafter — provided no Event of Default then exists — Borrower shall have the right (unless such Lender Party withdraws its request for additional compensation) to replace such Lender Party by requiring such Lender Party to assign its Loans and Note and its commitments hereunder to an Eligible Transferee reasonably acceptable to Administrative Agent and to Borrower, provided that: (i) all Obligations of Borrower owing to such Lender Party being replaced (including such increased costs and any breakage costs with respect to any outstanding LIBOR Loans, but excluding principal and accrued interest on the Note being assigned) shall be paid in full to such Lender Party concurrently with such assignment, and (ii) the replacement Eligible Transferee shall purchase the Notes being assigned by paying to such Lender Party a price equal to the principal amount thereof plus accrued and unpaid interest.",
"In connection with any such assignment Borrower, Administrative Agent, such Lender Party and the replacement Eligible Transferee 35 -------------------------------------------------------------------------------- shall otherwise comply with Section 10.5. Notwithstanding the foregoing rights of Borrower under this section, however, Borrower may not replace any Lender Party which seeks reimbursement for increased costs under Section 3.2 through 3.7 unless Borrower is at the same time replacing all Lender Parties which are then seeking such compensation. ARTICLE IV - Conditions Precedent to Lending Section 4.1. Documents to be Delivered. No Lender has any obligation to make its first Loan, and LC Issuer has no obligation to issue the first Letter of Credit, unless Administrative Agent shall have received all of the following, at Administrative Agent’s office in Boston, Massachusetts, duly executed and delivered and in form, substance and date satisfactory to Administrative Agent, each of which was so executed and delivered: (a) This Agreement and any other document that Lenders are to execute in connection herewith.",
"(b) Each Note and each Security Document. (c) Certain certificates including: (i) An “Omnibus Certificate” of the secretary or assistant secretary and any vice president of Plains Marketing GP Inc., which shall contain the names and signatures of the officers of such company authorized to execute Loan Documents and which shall certify to the truth, correctness and completeness of the following exhibits attached thereto: (1) a copy of resolutions duly adopted by the Board of Directors of such company and in full force and effect at the time this Agreement is entered into, authorizing the execution of this Agreement and the other Loan Documents delivered or to be delivered in connection herewith and the consummation of the transactions contemplated herein and therein, (2) a copy of the charter documents of Borrower and all amendments thereto, certified by the appropriate official of its jurisdiction of organization, and (3) a copy of the agreement of limited partnership of Borrower; (ii) A certificate of the chief financial officer of Plains Marketing GP Inc., regarding satisfaction of Section 4.2; and (d) A certificate (or certificates) of the due formation, valid existence and good standing of Borrower in Delaware, issued by the Delaware Secretary of State.",
"(e) Favorable opinions of Tim Moore, Esq., General Counsel for Borrower, substantially in the form set forth in Exhibit D-1, and Fulbright & Jaworski L.L.P., special Texas and New York counsel to Borrower, substantially in the form set forth in Exhibit D-2. (f) Financial projections for Borrower through December 2004, in form and substance reasonably satisfactory to Administrative Agent. 36 -------------------------------------------------------------------------------- (g) Consolidated financial statements of Borrower and its Subsidiaries as of September 30, 2003, together with a certificate by the chief financial officer of GP Inc. certifying such financial statements. (h) Administrative Agent shall have received all documents and instruments which Administrative Agent has then requested (including opinions of legal counsel for Borrower and Administrative Agent; corporate documents and records; documents evidencing governmental authorizations, consents, approvals, licenses and exemptions; and certificates of public officials and of officers and representatives of Borrower and other Persons), as to (i) the accuracy and validity of or compliance with all representations, warranties and covenants made by Borrower in this Agreement and the other Loan Documents, (ii) the satisfaction of all conditions contained herein or therein, and (iii) all other matters pertaining hereto and thereto. All such additional documents and instruments shall be satisfactory to Administrative Agent in form and substance.",
"(i) Payment of all facility, agency and other fees required to be paid to Administrative Agent or Lender pursuant to any Loan Documents or any commitment agreement heretofore entered into. (j) Evidence of the payment in full of all outstanding Indebtedness under the Existing Agreements, the release of all Liens securing such Indebtedness, and termination of the Existing Agreements. Section 4.2. Additional Conditions Precedent. No Lender has any obligation to make any Loan (including its first), and LC Issuer has no obligation to issue any Letter of Credit (including its first), unless the following conditions precedent have been satisfied: (a) All representations and warranties made by Borrower in any Loan Document shall be true on and as of the date of such Loan or the date of issuance of such Letter of Credit as if such representations and warranties had been made as of the date of such Loan or the date of issuance of such Letter of Credit except to the extent that such representation or warranty was made as of a specific date or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date. (b) No Default or “Default” (as such term is used and defined in the PAA Credit Agreement) shall exist at the date of such Loan or the date of issuance of such Letter of Credit or shall result from such Loan or such issuance of such Letter of Credit. ARTICLE V - Representations and Warranties To confirm each Lender’s understanding concerning Borrower and its businesses, properties and obligations, and to induce each Lender to enter into this Agreement, consider financing requests of Borrower hereunder, and in each Lender’s sole and absolute discretion extend credit hereunder, Borrower represents and warrants to each Lender that: 37 -------------------------------------------------------------------------------- Section 5.1.",
"No Default No event has occurred and is continuing which constitutes a Default, except as has been waived in accordance with this Agreement. Section 5.2. Organization and Good Standing. Borrower is duly organized or formed, validly existing and in good standing under the Laws of its jurisdiction of organization or formation, having all requisite corporate or similar powers required to carry on its business and enter into and carry out the transactions contemplated hereby. Borrower is duly qualified, in good standing, and authorized to do business in all other jurisdictions wherein the character of the properties owned or held by it or the nature of the business transacted by it makes such qualification necessary except where the failure to so qualify would not reasonably be expected to cause a Material Adverse Change. Section 5.3.",
"Authorization. Borrower has duly taken all action necessary to authorize the execution and delivery by it of the Loan Documents and to authorize the consummation of the transactions contemplated thereby and the performance of its obligations thereunder. Borrower is duly authorized to borrow funds hereunder. Section 5.4. No Conflicts or Consents. The execution and delivery by Borrower of the Loan Documents, the performance by it of its obligations, and the consummation of the transactions contemplated thereby, do not and will not (i) violate any provision of (1) Law applicable to it, (2) its organizational documents or (3) any judgment, order or material license or permit applicable to or binding upon it, (ii) result in the acceleration of any Indebtedness owed by it or (iii) result in or require the creation of any consensual Lien upon any of its material assets or properties except as expressly contemplated in, or permitted by, the Loan Documents.",
"Except as expressly contemplated in or permitted by the Loan Documents, disclosed in the Disclosure Schedule or disclosed pursuant to Section 6.4, no permit, consent, approval, authorization or order of, and no notice to or filing, registration or qualification with, any Tribunal is required on the part of Borrower pursuant to the provisions of any material Law applicable to it as a condition to its execution, delivery or performance of any Loan Document or (ii) to consummate any transactions contemplated by the Loan Documents. Section 5.5. Enforceable Obligations. This Agreement is, and the other Loan Documents when duly executed and delivered will be, legal, valid and binding obligations of Borrower, enforceable in accordance with their terms except as such enforcement may be limited by bankruptcy, insolvency or similar Laws of general application relating to the enforcement of creditors’ rights and general principles of equity. Section 5.6. Initial Financial Statements.",
"Borrower has heretofore delivered to each Lender true, correct and complete copies of the Initial Financial Statements. The Initial Financial Statements fairly present PAA’s and Borrower’s Consolidated financial position at the date thereof and the Consolidated results of PAA’s and Borrower’s operations for the periods thereof, and in the case of the annual Initial Financial Statements, Consolidated cash flows for the period thereof. Since the date of the annual Initial Financial Statements, no Material Adverse Change has occurred. All Initial Financial Statements described in clause (i) of that defined term were prepared in accordance with GAAP. 38 -------------------------------------------------------------------------------- Section 5.7. Other Obligations and Restrictions. As of the closing date hereof, Borrower has no outstanding payment obligations of any kind (including contingent obligations, tax assessments and unusual forward or long-term commitments) which are, in the aggregate, material to Borrower or material with respect to Borrower’s Consolidated financial condition and not reflected in the Initial Financial Statements, disclosed in the Disclosure Schedule or otherwise permitted under Section 7.1.",
"Except as disclosed in the Disclosure Schedule, Borrower is not subject to or restricted by any franchise, contract, deed, charter restriction, or other instrument or restriction which would reasonably be expected to cause a Material Adverse Change. Section 5.8. Full Disclosure. No certificate, statement or other information delivered herewith or heretofore by Borrower to any Lender in connection with the negotiation of this Agreement or in connection with any transaction contemplated hereby contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements contained herein or therein, in light of the circumstances under which they were made, not misleading as of the date made or deemed made (or if such information expressly relates or refers to an earlier date, as of such earlier date).",
"All written information furnished after the date hereof by or on behalf of Borrower to Administrative Agent or any Lender Party in connection with this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby will be true, complete and accurate in every material respect in light of the circumstances in which made or based on reasonable estimates, in each case as of the date on which such information is stated or certified (or if such information expressly relates or refers to an earlier date, as of such earlier date). There is no fact known to Borrower that has not been disclosed to each Lender in writing which would reasonably be expected to cause a Material Adverse Change. Section 5.9.",
"Litigation. Except as disclosed in the Initial Financial Statements or in the Disclosure Schedule: (i) there are no actions, suits or legal, equitable, arbitrative or administrative proceedings pending, or to the knowledge of Borrower overtly threatened, against Borrower or affecting any Collateral (including, without limitation, any which challenge or otherwise pertain to Borrower’s title to any Collateral) before any Tribunal which would reasonably be expected to cause a Material Adverse Change, and (ii) there are no outstanding judgments, injunctions, writs, rulings or orders by any such Tribunal against Borrower or, to the knowledge of Borrower, Borrower’s stockholders, partners, directors or officers or affecting any Collateral which would reasonably be expected to cause a Material Adverse Change. Section 5.10.",
"ERISA Plans and Liabilities. All currently existing ERISA Plans are listed in the Disclosure Schedule or pursuant to Section 6.4. Except as disclosed in the Initial Financial Statements, in the Disclosure Schedule or pursuant to Section 6.4, no Termination Event has occurred with respect to any ERISA Plan and all ERISA Affiliates are in compliance with ERISA in all material respects, to the extent that the non-compliance therewith would not be reasonably expected to cause a Material Adverse Change. No ERISA Affiliate is required to contribute to, or has any other absolute or contingent liability in respect of, any “multiemployer plan” as defined in Section 4001 of ERISA. Except as set forth in the Disclosure Schedule: (i) no “accumulated funding deficiency” (as defined in Section 412(a) of the Code) exists with respect to any ERISA Plan, whether or not waived by the Secretary of the Treasury or his delegate, and 39 -------------------------------------------------------------------------------- (ii) the current value of each ERISA Plan’s benefits does not exceed the current value of such ERISA Plan’s assets available for the payment of such benefits by more than $5,000,000.",
"Section 5.11. Compliance with Permits, Consents and Law. Except as set forth in the Disclosure Schedule or pursuant to Section 6.4, Borrower has all permits, licenses and authorizations required in connection with the conduct of its businesses, except to the extent failure to have any such permit, license or authorization would not reasonably be expected to cause a Material Adverse Change. Borrower is in compliance with the terms and conditions of all such permits, licenses and authorizations, and is also in compliance with all other limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in any Law, including applicable Environmental Law, or in any regulation, code, plan, order, decree, judgment, injunction, notice or demand letter issued, entered, promulgated or approved thereunder, except to the extent that non-compliance therewith would not reasonably be expected to cause a Material Adverse Change or such term, restriction or otherwise is being contested in good faith or a bona fide dispute exists with respect thereto. Section 5.12.",
"Environmental Laws. Except as set forth in the Disclosure Schedule or disclosed pursuant to Section 6.4, (i) Borrower and its Subsidiaries are conducting their businesses in material compliance with all applicable Laws, including Environmental Laws, and have and are in compliance with all licenses and permits required under any such Laws, unless failure to so comply or have such licenses and permits would not reasonably be expected to cause a Material Adverse Change; (ii) none of the operations or properties of Borrower or any of its Subsidiaries is the subject of federal, provincial or local investigation evaluating whether any material remedial action is needed to respond to a release of any Hazardous Materials into the environment or to the improper storage or disposal (including storage or disposal at offsite locations) of any Hazardous Materials, unless such remedial action would not reasonably be expected to cause a Material Adverse Change; and (iii) neither Borrower nor any of its Subsidiaries (and to the actual knowledge of Borrower, no other Person) has filed any notice under any Law indicating that Borrower or any of its Subsidiaries is responsible for the improper release into the environment, or the improper storage or disposal, of any material amount of any Hazardous Materials or that any Hazardous Materials have been improperly released, or are improperly stored or disposed of, upon any property of any such Person, other than of an alleged improper release, storage or disposal that would not reasonably be expected to cause a Material Adverse Change.",
"Section 5.13. Accounts; Title to Properties. All Accounts arising from with respect to contracts for the sale of Financed Eligible Hedged Inventory shall qualify as Approved Eligible Receivables, and Borrower has complied in all respects with the terms of each related contract for sale. Borrower has good and defensible title to all of its material properties and assets, free and clear of all Liens (other than Permitted Liens) and of all impediments to the use of such properties and assets in its business, other than such impediments that would not reasonably be expected to cause a Material Adverse Change. Section 5.14. Government Regulation. Borrower is not subject to regulation under the Public Utility Holding Company Act of 1935, the Investment Company Act of 1940 (as any of the preceding acts have been amended) or any other Law which regulates the incurring by 40 -------------------------------------------------------------------------------- Borrower of Indebtedness, including Laws relating to common contract carriers or the sale of electricity, gas, steam, water or other public utility services.",
"Borrower is not subject to regulation under the Federal Power Act which would violate, result in a default of, or prohibit the effectiveness or the performance of any of the provisions of the Loan Documents. Section 5.15. Insider. Neither Borrower, nor any Person having “control” (as that term is defined in 12 U.S.C. § 375b(9) or in regulations promulgated pursuant thereto) of Borrower, is a “director” or an “executive officer” or “principal shareholder” (as those terms are defined in 12 U.S.C. § 375b(8) or (9) or in regulations promulgated pursuant thereto) of any Lender, of a bank holding company of which any Lender is a Subsidiary or of any Subsidiary of a bank holding company of which any Lender is a Subsidiary.",
"Section 5.16. Solvency. Upon giving effect to the issuance of the Notes, the execution of the Loan Documents by Borrower and the consummation of the transactions contemplated hereby, (i) Borrower will be solvent (as such term is used in applicable bankruptcy, liquidation, receivership, insolvency or similar Laws), and the sum of Borrower’s absolute and contingent liabilities, including the Obligations or guarantees thereof, shall not exceed the fair market value of Borrower’s assets, and (ii) Borrower’s capital should be adequate for the businesses in which it is engaged and intends to be engaged. Borrower has not incurred (whether under the Loan Documents or otherwise), nor does Borrower intend to incur or reasonably foreseeably believes that it will incur, debts which will be beyond its ability to pay as such debts mature. Section 5.17. Not a “Reportable Transaction”.",
"Borrower does not intend to treat the Borrowings and/or Letters of Credit and related transactions as being a “reportable transaction” (within the meaning of Treasury Regulation Section 1.6011-4). In the event Borrower determines to take any action inconsistent with such intention, it will promptly notify the Administrative Agent thereof. If Borrower takes any action inconsistent with such intention, or if Borrower so notifies the Administrative Agent, then Borrower acknowledges that, as a result of such action or notice, one or more of the Lenders may treat its Loans and/or its interest in Letters of Credit as part of a transaction that is subject to Treasury Regulation Section 301.6112-1, and such Lender or Lenders will maintain the lists and other records required by such Treasury Regulation. ARTICLE VI - Affirmative Covenants To conform with the terms and conditions under which each Lender is willing to consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit to Borrower, and to induce each Lender to enter into this Agreement, consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit hereunder, Borrower covenants and agrees that so long as any Obligations or any commitment of any Participating Lender to extend credit hereunder remains outstanding, unless Majority Lenders, or all Lenders as required under Section 10.1, have previously agreed otherwise: Section 6.1.",
"Payment and Performance. Borrower will pay all amounts due from it pursuant to the provisions of the Loan Documents to which it is a party in accordance with the 41 -------------------------------------------------------------------------------- terms thereof and will observe, perform and comply with every covenant, term and condition imposed on it pursuant to the provisions of such Loan Documents. Section 6.2. Books, Financial Statements and Reports. Borrower will at all times maintain full and accurate books of account and records. Borrower will maintain a standard system of accounting, will maintain its Fiscal Year, and will furnish the following statements and reports to each Lender at Borrower’s expense: (a) Promptly upon the filing thereof, and in any event within ninety (90) days after the end of each Fiscal Year: (i) a copy of PAA’s Form 10-K, which report shall include PAA’s complete Consolidated financial statements together with all notes thereto, prepared in reasonable detail in accordance with GAAP, together with an opinion, without material qualification, based on an audit using generally accepted auditing standards, by PricewaterhouseCoopers LLP, or other independent certified public accountants, stating that such Consolidated financial statements have been so prepared, and (ii) Borrower’s complete unaudited Consolidated financial statements, prepared in reasonable detail in accordance with GAAP.",
"These financial statements shall contain a Consolidated balance sheet as of the end of such Fiscal Year and Consolidated statements of earnings for such Fiscal Year. Such Consolidated financial statements shall set forth in comparative form the corresponding figures for the preceding Fiscal Year. (b) Promptly upon the filing thereof, and in any event within sixty (60) days after the end of each of the first three Fiscal Quarters of each Fiscal Year: (i) a copy of PAA’s Form 10-Q, which report shall include PAA’s unaudited Consolidated balance sheet as of the end of such Fiscal Quarter and Consolidated statements of PAA’s earnings and cash flows for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter, and (ii) Borrower’s unaudited Consolidated balance sheet as of the end of such. Fiscal Quarter and Consolidated statements of Borrower’s earnings and cash flows for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter.",
"In addition Borrower will, together with each such set of financial statements and each set of financial statements furnished under subsection (a) of this section, furnish a copy of the certificate delivered to the administrative agent and lenders under the PAA Credit Agreement pursuant to Section 6.2(b) thereof. (c) Prompt notice of any publicly announced change in PAA’s Debt Rating by either Standard & Poor’s or Moody’s. Documents required to be delivered pursuant to Section 6.2(a)(i) or (b)(i) (to the extent any such documents are included in materials otherwise filed with the Securities and Exchange Commission) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which PAA posts such documents, or provides a link thereto, on PAA’s website on the Internet at the website address listed in Section 10.3, and notifies Administrative Agent of such posting or link. Section 6.3. Other Information and Inspections.",
"In each case subject to the last sentence of this Section 6.3, Borrower will furnish to Administrative Agent any information which Administrative Agent or any Lender may from time to time reasonably request concerning any 42 -------------------------------------------------------------------------------- covenant, provision or condition of the Loan Documents or any matter in connection with Borrower’s businesses and operations. In each case subject to the last sentence of this Section 6.3, Borrower will permit representatives appointed by Administrative Agent (including independent accountants, auditors, agents, attorneys, appraisers and any other Persons), upon reasonable prior notice, to visit and inspect during normal business hours any of Borrower’s property, including its books of account, other books and records, and any facilities or other business assets, and to make extra copies therefrom and photocopies and photographs thereof, and to write down and record any information such representatives obtain, and Borrower shall permit Administrative Agent or its representatives to investigate and verify the accuracy of the information furnished to Administrative Agent or any Lender in connection with the Loan Documents and to discuss all such matters with its officers, employees and, upon reasonable prior notice to Borrower, its representatives. Each of the foregoing inspections and examinations shall be made subject to compliance with applicable safety standards and the same conditions applicable to Borrower in respect of property of Borrower on the premises of Persons other than Borrower or an Affiliate of Borrower, and all information, books and records furnished or requested to be made, all information to be investigated or verified and all discussion conducted with any officer, employee or representative of Borrower shall be subject to any applicable attorney-client privilege exceptions which Borrower determines is reasonably necessary and compliance with conditions to disclosures under non-disclosure agreements between Borrower and Persons other than Borrower or an Affiliate of Borrower and the express undertaking of each Person acting at the direction of or on behalf of any Lender Party to be bound by the confidentiality provisions of Section 10.6 of this Agreement.",
"Section 6.4. Notice of Material Events. Borrower will notify each Lender Party, not later than five (5) Business Days after any executive officer of Borrower has knowledge thereof, stating that such notice is being given pursuant to this Agreement, of: (a) the occurrence of any Material Adverse Change, (b) the occurrence of any Default, (c) the acceleration of the maturity of any Indebtedness owed by Borrower or of any default by Borrower under any indenture, mortgage, agreement, contract or other instrument to which it is a party or by which it or any of its properties is bound, if such acceleration or default would reasonably be expected to cause a Material Adverse Change, (d) the occurrence of any Termination Event, (e) any claim under any Environmental Law adverse to Borrower or of potential liability with respect to such claim, or any other adverse claim asserted against Borrower or with respect to Borrower’s properties taken as a whole, in each case, which claim would reasonably be expected to cause a Material Adverse Change, and 43 -------------------------------------------------------------------------------- (f) the filing of any suit or proceeding, or the assertion in writing of a claim against Borrower or with respect to Borrower’s properties, which would reasonably be expected to cause a Material Adverse Change.",
"Upon the occurrence of any of the foregoing Borrower will take all necessary or appropriate steps to remedy promptly, if applicable, any such Material Adverse Change, Default, acceleration, default or Termination Event, to protect against any such adverse claim, to defend any such claim, suit or proceeding, and to resolve all controversies on account of any of the foregoing. Section 6.5. Maintenance of Existence, Qualifications and Assets. Borrower (i) will maintain and preserve its existence and its rights (including permits, licenses and other authorizations required under Environmental Laws) and franchises in full force and effect, (ii) will qualify to do business in all states or jurisdictions where required by applicable Law, and (iii) keep all Collateral and its other material assets that are useful in and necessary to its business in good working order and condition (ordinary wear and tear and obsoleteness excepted) except, in each case (a) where the failure so to maintain, preserve, qualify or keep would not be reasonably expected to cause a Material Adverse Change, (b) as permitted in Section 7.3 or as a result of statutory conversions or (c) as a result of a release permitted pursuant to Section 6.9.",
"Borrower will also notify Administrative Agent in writing at least twenty Business Days prior to the date that Borrower changes its name or the location of its chief executive office or principal place of business or the place where it keeps its books and records concerning the Collateral, furnishing with such notice any necessary financing statement amendments or requesting Administrative Agent to prepare the same. Section 6.6. Payment of Taxes, etc.",
"Borrower will (a) timely file all required tax returns (including any extensions), (b) timely pay all taxes, assessments, and other governmental charges or levies imposed upon it or upon its income, profits or property, and (c) maintain appropriate accruals and reserves for all of the foregoing as required by GAAP, except to the extent that (y) it is in good faith contesting the validity thereof by appropriate proceedings, if necessary, and has set aside on its books adequate reserves therefor which are required by GAAP or (z) such non-filing, non-payment or non-maintenance would not reasonably be expected to cause a Material Adverse Change. Section 6.7. Insurance. In accordance with industry standards, Borrower will keep insured (by responsible and reputable insurance companies or associations) or self-insured, at the option of Borrower, in such amounts and against such risks as are usually insured by Persons engaged in the same or similar businesses and owning similar properties. The insurance coverages and amounts will be reasonably determined by Borrower, based on coverages carried by prudent owners of similar property, and may be maintained by PAA.",
"Section 6.8. Compliance with Agreements and Law. Borrower will strictly perform and comply with the terms of each contract for the sale of Hedged Eligible Inventory and will perform all other material obligations it is required to perform under the terms of each indenture, mortgage, deed of trust, security agreement, lease, franchise and other material agreement, contract or other instrument (including all contractual obligations and agreements with respect to environmental remediation or other environmental matters) to which it is a party or by which it or 44 -------------------------------------------------------------------------------- any of its properties is bound to the extent that non-performance therewith would not reasonably be expected to cause a Material Adverse Change. Borrower will conduct its business and affairs in compliance, in all material respects, with all Laws (including Environmental Laws) applicable thereto to the extent non-compliance therewith would not reasonably be expected to cause a Material Adverse Change or such requirement of Law is being contested in good faith or a bona fide dispute exists with respect thereto. Section 6.9.",
"Agreement to Deliver Security Documents. Borrower will deliver, to further secure the Obligations whenever requested by Administrative Agent in its sole and absolute discretion, chattel mortgages, security agreements, financing statements and other Security Documents in form and substance satisfactory to Administrative Agent for the purpose of granting, confirming, and perfecting first and prior liens or security interests, subject to applicable Liens permitted pursuant to Section 7.1, in (i) all Financed Hedged Eligible Inventory, (ii) all Hedging Contracts covering Financed Hedged Eligible Inventory, (iii) all contracts for the sale of Financed Hedged Eligible Inventory and Accounts arising thereunder, and (iv) all proceeds of the foregoing.",
"Section 6.10. Perfection and Protection of Security Interests and Liens. Borrower will from time to time deliver to Administrative Agent any financing statements, continuation statements, extension agreements and other documents, properly completed and executed (and acknowledged when required) by Borrower in form and substance satisfactory to Administrative Agent, which Administrative Agent requests for the purpose of perfecting, confirming, or protecting any Liens or other rights in Collateral securing any Obligations. ARTICLE VII - Negative Covenants To conform with the terms and conditions under which each Lender is willing to consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit to Borrower, and to induce each Lender to enter into this Agreement, consider financing requests of Borrower hereunder and in each Lender’s sole and absolute discretion extend credit hereunder, Borrower covenants and agrees that so long as any Obligations or any commitment of any Participating Lender to extend credit hereunder remains outstanding, unless Majority Lenders, or all Lenders as required under Section 10.1, have previously agreed otherwise: Section 7.1. Limitation on Liens. Borrower will not create, assume or permit to exist: (i) any Lien upon any Collateral except (A) Liens created pursuant to the Security Documents, (B) Permitted Inventory Liens, (C) statutory Liens in respect of First Purchase Crude Payables, (D) Broker Liens on margin deposits with respect to Hedging Contracts, and (E) any other Liens expressly permitted to encumber such Collateral under any Security Document; or (ii) any Lien on any Petroleum Products commingled with Financed Hedged Eligible Inventory, or on any sales contracts (and Accounts therefrom and proceeds thereof) covering Petroleum Products in addition to Financed Hedged Eligible Inventory, or with respect to any Hedging Contracts covering Financed Hedged Eligible Inventory, other than Broker Liens on 45 -------------------------------------------------------------------------------- margin deposits with respect thereto, unless such lien creditor has agreed in writing that Administrative Agent’s and Lenders’ rights with respect to such Petroleum Products, sales contracts, Hedging Contracts and collateral rights related thereto are first and prior to such lien creditor’s rights therein; Section 7.2.",
"Limitation on Mergers. Except as expressly provided in this section, Borrower will not (a) merge or consolidate or amalgamate with any Person, or liquidate, wind up or dissolve or (b) sell, transfer, lease, exchange or otherwise dispose of, in one transaction or a series of related transactions, all or substantially all of its business or property, whether now owned or hereafter acquired, to any Person; provided, Borrower may (A) merge into or consolidate or amalgamate with any Subsidiary of PAA; provided, Borrower is the surviving business entity and after giving effect thereto, no Default exists. Section 7.3.",
"Limitation on Sales of Collateral. Borrower will not sell, transfer, lease, exchange, alienate or dispose of any Collateral except in the ordinary course of business on ordinary trade terms. Section 7.4. Limitation on New Businesses. Borrower will not materially or substantially engage directly or indirectly in any business or conduct any operations other than (i) marketing, gathering, transporting (by barge, pipeline, ship, truck or other modes of hydrocarbon transportation), terminalling, storing, producing, acquiring, developing, exploring for, exploiting, producing, processing, dehydrating and otherwise handling hydrocarbons, including, without limitation, constructing pipeline, platform, dehydration, processing and other energy-related facilities, (ii) any other business that generates gross income that constitutes “qualifying income” under Section 7704(d) of the Internal Revenue Code of 1986, as amended, or (iii) activities or services reasonably related or ancillary thereto including entering into hedging obligations to support those businesses. Section 7.5.",
"No Negative Pledges. Except as described in the Disclosure Schedule or pursuant to a Restriction Exception, the substance of which, in detail satisfactory to Administrative Agent, is promptly reported to Administrative Agent, Borrower will not, directly or indirectly, enter into, create, or consent to be bound to any contract or other consensual restriction that restricts the ability of Borrower to create or maintain Liens on its assets in favor of Administrative Agent, LC Issuer and Lenders to secure, in whole or part, the Obligations.",
"ARTICLE VIII - Events of Default and Remedies Section 8.1. Events of Default.",
"Each of the following events constitutes an Event of Default under this Agreement: (a) Borrower fails to pay the principal component of any Loan or any reimbursement obligation with respect to any Letter of Credit when due and payable, whether at a date for the payment of a fixed installment or as a contingent or other payment becomes due and payable or as a result of acceleration or otherwise; (b) Borrower fails to pay any Obligation for which it is contractually liable (other than the Obligations in subsection (a) above) when due and payable, whether at a date for the payment of 46 -------------------------------------------------------------------------------- a fixed installment or as a contingent or other payment becomes due and payable or as a result of acceleration or otherwise, within three Business Days after the same becomes due; (c) Borrower fails to duly observe, perform or comply with any covenant, agreement or provision of Section 6.4 or Article VII; (d) Borrower fails (other than as referred to in subsections (a), (b) or (c) above) to duly observe, perform or comply with any of its obligations under any covenant, agreement, condition or provision of any Loan Document to which it is a party, and such failure remains unremedied for a period of thirty (30) days after notice of such failure is given by Administrative Agent to Borrower; (e) Any representation or warranty previously, presently or hereafter made in writing by or on behalf of Borrower in connection with any Loan Document shall prove to have been false or incorrect in any material respect on any date on or as of which made, or any Loan Document at any time ceases to be valid, binding and enforceable as warranted in Section 5.5 for any reason other than its release or subordination by Administrative Agent; (f) Borrower shall default in the payment when due of any principal of or interest on any of its other Indebtedness, or, as a result of an early termination event or similar event, on any net hedging obligations, in excess of $15,000,000 in the aggregate (other than such Indebtedness or hedging obligations the validity of which is being contested in good faith, by appropriate proceedings (if necessary) and for which adequate reserves with respect thereto are maintained on the books of Borrower as required by GAAP), or any event specified in any note, agreement, indenture or other document evidencing or relating to any such Indebtedness or hedging obligations shall occur for a period beyond the applicable grace, cure extension, forbearance or other similar period, if the effect of such event is to cause, or (with the giving of any notice or the lapse of time or both) to permit the holder or holders of such Indebtedness or hedging obligations (or a trustee or agent on behalf of such holder or holders) to cause, as applicable, such Indebtedness to become due, or to be prepaid in full (whether by redemption, purchase, offer to purchase or otherwise), prior to its stated maturity, or an early termination event or similar event to occur and Borrower’s related net hedging obligations in excess of $15,000,000 to become due and payable; (g) Either (i) any “accumulated funding deficiency” (as defined in Section 412(a) of the Code) in excess of $5,000,000 exists with respect to any ERISA Plan, whether or not waived by the Secretary of the Treasury or his delegate, or (ii) any Termination Event occurs with respect to any ERISA Plan and the then current value of such ERISA Plan’s benefit liabilities exceeds the then current value of such ERISA Plan’s assets available for the payment of such benefit liabilities by more than $5,000,000 (or in the case of a Termination Event involving the withdrawal of a substantial employer, the withdrawing employer’s proportionate share of such excess exceeds such amount); (h) Borrower, any Subsidiary of Borrower, Plains All American GP LLC, Plains AAP, L.P., PAA, or any “significant subsidiary” of PAA, as defined in Article 1, Rule 1-02 of 47 -------------------------------------------------------------------------------- Regulation S-X, promulgated pursuant to the Securities Exchange Act of 1934 and the Securities Act of 1933, each as amended: (i) has entered against it a judgment, decree or order for relief by a Tribunal of competent jurisdiction in an involuntary proceeding commenced under any applicable bankruptcy, insolvency or other similar Law of any jurisdiction now or hereafter in effect, including the federal Bankruptcy Code, as from time to time amended, or has any such proceeding commenced against it, in each case, which remains undismissed for a period of sixty days; or (ii) commences a voluntary case under any applicable bankruptcy, insolvency or similar Law now or hereafter in effect, including the federal Bankruptcy Code, as from time to time amended; or applies for or consents to the entry of an order for relief in an involuntary case under any such Law; or makes a general assignment for the benefit of creditors; or is generally unable to pay (or admits in writing its inability to so pay) its debts as such debts become due; or takes corporate or other action to authorize any of the foregoing; or (iii) has entered against it the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of any Collateral or all or a substantial part of its assets in a proceeding brought against or initiated by it, and such appointment or taking possession is neither made ineffective nor discharged within sixty days after the making thereof, or such appointment or taking possession is at any time consented to, requested by, or acquiesced to by it; (i) Borrower: (i) has entered against it a final judgment for the payment of money in excess of $15,000,000 (in each case not covered by insurance satisfactory to Administrative Agent in its discretion), unless the same is stayed or discharged within thirty days after the date of entry thereof (or longer period for which a stay of enforcement is allowed by applicable Law) or an appeal or appropriate proceeding for review thereof is taken within such period and a stay of execution pending such appeal is obtained; or (ii) suffers a writ or warrant of attachment or any similar process to be issued by any Tribunal against any Collateral or all or any substantial part of its assets, and such writ or warrant of attachment or any similar process is not stayed or released within sixty days after the entry or levy thereof (or longer period for which a stay of enforcement is allowed by applicable Law) or after any stay is vacated or set aside; (j) Any Change in Control occurs; or (k) Any “Event of Default” shall occur, as such term is used and defined in the PAA Credit Agreement.",
"48 -------------------------------------------------------------------------------- Upon the occurrence of an Event of Default described in subsection (h)(i), (h)(ii) or (h)(iii) of this section: all Obligations shall thereupon be immediately due and payable, without demand, presentment, notice of demand or of dishonor and nonpayment, protest, notice of protest, notice of intention to accelerate, declaration or notice of acceleration, or any other notice or declaration of any kind, all of which are hereby expressly waived by Borrower. Upon any such acceleration, any obligation of any Lender to make any further Loans and any obligation of LC Issuer to issue Letters of Credit hereunder shall be permanently terminated. During the continuance of any other Event of Default, Administrative Agent at any time and from time to time may (and upon written instructions from Majority Lenders, Administrative Agent shall), without notice to Borrower, do either or both of the following: (1) terminate or suspend any obligation of Lenders to make Loans hereunder and any obligation of LC Issuer to issue Letters of Credit hereunder, and (2) declare any or all of the Obligations immediately due and payable, and all such Obligations shall thereupon be immediately due and payable, without demand, presentment, notice of demand or of dishonor and nonpayment, protest, notice of protest, notice of intention to accelerate, declaration or notice of acceleration, or any other notice or declaration of any kind, all of which are hereby expressly waived by Borrower. Section 8.2.",
"Remedies. If any Default shall occur and be continuing, each Lender Party may protect and enforce its rights under the Loan Documents by any appropriate proceedings, including proceedings for specific performance of any covenant or agreement contained in any Loan Document, and each Lender Party may enforce the payment of any Obligations due it or enforce any other legal or equitable right which it may have. All rights, remedies and powers conferred upon Lender Parties under the Loan Documents shall be deemed cumulative and not exclusive of any other rights, remedies or powers available under the Loan Documents or at Law or in equity. ARTICLE IX - Administrative Agent Section 9.1.",
"Appointment and Authority. Each Lender Party hereby irrevocably authorizes Administrative Agent, and Administrative Agent hereby undertakes, to receive payments of principal, interest and other amounts due hereunder as specified herein and to take all other actions and to exercise such powers under the Loan Documents as are specifically delegated to Administrative Agent by the terms hereof or thereof, together with all other powers reasonably incidental thereto. The relationship of Administrative Agent to the other Lender Parties is only that of one commercial lender acting as administrative agent for others, and nothing in the Loan Documents shall be construed to constitute Administrative Agent a trustee or other fiduciary for any Lender Party or any holder of any participation in a Note nor to impose on Administrative Agent duties and obligations other than those expressly provided for in the Loan Documents.",
"With respect to any matters not expressly provided for in the Loan Documents and any matters which the Loan Documents place within the discretion of Administrative Agent, Administrative Agent shall not be required to exercise any discretion or take any action, and it may request instructions from Lenders with respect to any such matter, in which case it shall be required to act or to refrain from acting (and shall be fully protected and free from liability to all Lender Parties in so acting or refraining from acting) upon the instructions of Majority Lenders (including itself), provided, however, that Administrative Agent shall not be required to take any action which exposes it to a risk of personal liability that it considers unreasonable or which is 49 -------------------------------------------------------------------------------- contrary to the Loan Documents or to applicable Law. Upon receipt by Administrative Agent from Borrower of any communication calling for action on the part of Lenders or upon notice from Borrower or any Lender to Administrative Agent of any Default or Event of Default, Administrative Agent shall promptly notify each other Lender thereof. Section 9.2.",
"Exculpation, Administrative Agent’s Reliance, Etc. Neither Administrative Agent nor any of its directors, officers, agents, attorneys, or employees shall be liable for any action taken or omitted to be taken by any of them under or in connection with the Loan Documents, including their negligence of any kind, except that each shall be liable for its own gross negligence or willful misconduct. Without limiting the generality of the foregoing, Administrative Agent (a) may treat the payee of any Note as the holder thereof until Administrative Agent receives written notice of the assignment or transfer thereof in accordance with this Agreement, signed by such payee and in form satisfactory to Administrative Agent; (b) may consult with legal counsel (including counsel for Borrower), independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (c) makes no warranty or representation to any other Lender Party and shall not be responsible to any other Lender Party for any statements, warranties or representations made in or in connection with the Loan Documents; (d) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of the Loan Documents on the part of Borrower or to inspect the property (including the books and records) of Borrower; (e) shall not be responsible to any other Lender Party for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Loan Document or any instrument or document furnished in connection therewith; (f) may rely upon the representations and warranties of Borrower or Lender Party in exercising its powers hereunder; and (g) shall incur no liability under or in respect of the Loan Documents by acting upon any notice, consent, certificate or other instrument or writing (including any facsimile, telegram, cable or telex) believed by it to be genuine and signed or sent by the proper Person or Persons.",
"Section 9.3. Credit Decisions. Each Lender Party acknowledges that it has, independently and without reliance upon any other Lender Party, made its own analysis of Borrower and the transactions contemplated hereby and its own independent decision to enter into this Agreement and the other Loan Documents. Each Lender Party also acknowledges that it will, independently and without reliance upon any other Lender Party and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents. Section 9.4.",
"Indemnification. Each Lender agrees to indemnify Administrative Agent (to the extent not reimbursed by Borrower within ten (10) days after demand) from and against such Lender’s Percentage Share of any and all liabilities, obligations, claims, losses, damages, penalties, fines, actions, judgments, suits, settlements, costs, expenses or disbursements (including reasonable fees of attorneys, accountants, experts and advisors) of any kind or nature whatsoever (in this section collectively called “liabilities and costs”) which to any extent (in whole or in part) may be imposed on, incurred by, or asserted against Administrative Agent growing out of, resulting from or in any other way associated with any of the Collateral, the Loan Documents and the 50 -------------------------------------------------------------------------------- transactions and events (including the enforcement thereof) at any time associated therewith or contemplated therein and Borrower’s use of loan proceeds (whether arising in contract or in tort or otherwise and including any violation or noncompliance with any Environmental Laws by any Person or any liabilities or duties of any Person with respect to Hazardous Materials found in or released into the environment). The foregoing indemnification shall apply whether or not such liabilities and costs are in any way or to any extent owed, in whole or in part, under any claim or theory of strict liability or caused, in whole or in part, by any negligent act or omission of any kind by Administrative Agent, provided only that no Lender shall be obligated under this section to indemnify Administrative Agent for that portion, if any, of any liabilities and costs which is proximately caused by Administrative Agent’s own individual gross negligence or willful misconduct, as determined in a final judgment.",
"Cumulative of the foregoing, each Lender agrees to reimburse Administrative Agent promptly upon demand for such Lender’s Percentage Share of any costs and expenses to be paid to Administrative Agent by Borrower under Section 10.4(a) to the extent that Administrative Agent is not timely reimbursed for such expenses by Borrower as provided in such section. As used in this section the term “Administrative Agent” shall refer not only to the Persons designated as such in Section 1.1 but also to each director, officer, agent, attorney, employee, representative and Affiliate of such Person. Section 9.5. Rights as Lender. In its capacity as a Lender, Administrative Agent shall have the same rights and obligations as any Lender and may exercise such rights as though it were not Administrative Agent. Administrative Agent may accept deposits from, lend money to, act as trustee under indentures of, and generally engage in any kind of business with Borrower or its Affiliates, all as if it were not Administrative Agent hereunder and without any duty to account therefor to any other Lender.",
"Section 9.6. Sharing of Set-Offs and Other Payments. Each Lender Party agrees that if it shall, whether through the exercise of rights of banker’s lien, set off, or counterclaim against Borrower or otherwise, obtain payment of a portion of the aggregate Obligations owed to it which, taking into account all distributions made by Administrative Agent under Section 3.1, causes such Lender Party to have received more than it would have received had such payment been received by Administrative Agent and distributed pursuant to Section 3.1, then (a) it shall be deemed to have simultaneously purchased and shall be obligated to purchase interests in the Obligations as necessary to cause all Lender Parties to share all payments as provided for in Section 3.1, and (b) such other adjustments shall be made from time to time as shall be equitable to ensure that Administrative Agent and all Lender Parties share all payments of Obligations as provided in Section 3.1; provided, however, that nothing herein contained shall in any way affect the right of any Lender Party to obtain payment (whether by exercise of rights of banker’s lien, set-off or counterclaim or otherwise) of indebtedness other than the Obligations.",
"Borrower expressly consents to the foregoing arrangements, subject to Section 10.9. If all or any part of any funds transferred pursuant to this section is thereafter recovered from the seller under this section which received the same, the purchase provided for in this section shall be deemed to have been rescinded to the extent of such recovery, together with interest, if any, if interest is 51 -------------------------------------------------------------------------------- required pursuant to the order of a Tribunal to be paid on account of the possession of such funds prior to such recovery. Section 9.7. Investments. Whenever Administrative Agent in good faith determines that it is uncertain about how to distribute to Lender Parties any funds which it has received, or whenever Administrative Agent in good faith determines that there is any dispute among Lender Parties about how such funds should be distributed, Administrative Agent may choose to defer distribution of the funds which are the subject of such uncertainty or dispute.",
"If Administrative Agent in good faith believes that the uncertainty or dispute will not be promptly resolved, or if Administrative Agent is otherwise required to invest funds pending distribution to Lender Parties, Administrative Agent shall invest such funds pending distribution; all interest on any such Investment shall be distributed upon the distribution of such Investment and in the same proportion and to the same Persons as such Investment. All moneys received by Administrative Agent for distribution to Lender Parties (other than to the Person who is Administrative Agent in its separate capacity as a Lender Party) shall be held by Administrative Agent pending such distribution solely as Administrative Agent for such Lender Parties, and Administrative Agent shall have no equitable title to any portion thereof.",
"Section 9.8. Benefit of Article IX. The provisions of this Article are intended solely for the benefit of Lender Parties, and Borrower shall not be entitled to rely on any such provision or assert any such provision in a claim or defense against any Lender (other than contained in Section 9.6 or the right to reasonably approve a successor Administrative Agent under Section 9.9). Lender Parties may waive or amend such provisions as they desire without any notice to or consent of Borrower. Section 9.9. Resignation. Administrative Agent may resign at any time by giving written notice thereof to Lenders and Borrower. Each such notice shall set forth the date of such resignation. Upon any such resignation Majority Lenders shall have the right to appoint a successor Administrative Agent, subject to the approval of Borrower, unless a Default has occurred and is continuing, which approval will not be unreasonably withheld. A successor must be appointed for any retiring Administrative Agent, and such Administrative Agent’s resignation shall become effective when such successor accepts such appointment.",
"If, within thirty days after the date of the retiring Administrative Agent’s resignation, no successor Administrative Agent has been appointed and has accepted such appointment, then the retiring Administrative Agent may appoint a successor Administrative Agent, which shall be a commercial bank organized or licensed to conduct a banking or trust business under the Laws of the United States of America or of any state thereof. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. After any retiring Administrative Agent’s resignation hereunder the provisions of this Article IX shall continue to inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Loan Documents. 52 -------------------------------------------------------------------------------- ARTICLE X - Miscellaneous Section 10.1. Waivers and Amendments; Acknowledgments. (a) Waivers and Amendments. No failure or delay (whether by course of conduct or otherwise) by any Lender in exercising any right, power or remedy which such Lender Party may have under any of the Loan Documents shall operate as a waiver thereof or of any other right, power or remedy, nor shall any single or partial exercise by any Lender Party of any such right, power or remedy preclude any other or further exercise thereof or of any other right, power or remedy.",
"No waiver of any provision of any Loan Document and no consent to any departure therefrom shall ever be effective unless it is in writing and signed as provided below in this section, and then such waiver or consent shall be effective only in the specific instances and for the purposes for which given and to the extent specified in such writing. This Agreement and the other Loan Documents set forth the entire understanding between the parties hereto with respect to the transactions contemplated herein and therein and supersede all prior discussions and understandings with respect to the subject matter hereof and thereof, and no waiver, consent, release, modification or amendment of or supplement to this Agreement or the other Loan Documents shall be valid or effective against any party hereto unless the same is in writing and signed by (i) if such party is Borrower, by Borrower, (ii) if such party is Administrative Agent or LC Issuer, by such party, and (iii) if such party is a Lender, by such Lender or by Administrative Agent on behalf of Lenders with the written consent of Majority Lenders (which consent has already been given as to the termination of the Loan Documents as provided in Section 10.9).",
"Notwithstanding the foregoing or anything to the contrary herein, Administrative Agent shall not, without the prior consent of each individual Lender, execute and deliver on behalf of such Lender any waiver or amendment which would: (1) waive any of the conditions specified in Article IV (provided that Administrative Agent may in its discretion withdraw any request it has made under Section 4.1(h)), (2) increase the maximum amount which such Lender has specified hereunder regarding consideration of financing requests, or extend the termination date of such Lender’s agreement to consider financing requests, (3) reduce any fees payable to such Lender hereunder, or the principal of, or interest on, such Lender’s Note, (4) change any date fixed for any payment of any such fees, principal or interest, or change Section 9.6 in a manner that would alter pro rata sharing of payments required thereby, (5) amend the definition herein of “Majority Lenders” or otherwise change the Percentage Shares which are required for Administrative Agent, Lenders or any of them to take any particular action under the Loan Documents, or (6) except as expressly provided herein or in any other Loan Document, release (i) Borrower from its obligation to pay such Lender’s Note, (ii) any Collateral, or (iii) Borrower from the negative pledge covenant set forth in Section 7.5 hereof.",
"(b) Acknowledgments and Admissions. Borrower hereby represents, warrants, acknowledges and admits that (i) it has been advised by counsel in the negotiation, execution and delivery of the Loan Documents to which it is a party, (ii) no Lender Party has any fiduciary obligation toward Borrower with respect to any Loan Document or the transactions contemplated thereby, (iii) the relationship pursuant to the Loan Documents between Borrower, on one hand, and each Lender Party, on the other hand, is and shall be solely that of debtor and creditor, respectively, and (iv) no partnership or joint venture exists with respect to the Loan Documents between Borrower and any Lender Party. 53 -------------------------------------------------------------------------------- (c) Representation by Lenders.",
"Each Lender hereby represents that it will acquire its Notes for its own account in the ordinary course of its commercial lending or investing business; however, the disposition of such Lender’s property shall at all times be and remain within its control and, in particular and without limitation, such Lender may sell or otherwise transfer its Note, any participation interest or other interest in its Note, or any of its other rights and obligations under the Loan Documents subject to compliance with Sections 10.5(b) through (f), inclusive, and applicable Law. (d) Joint Acknowledgment. This written Agreement and the other Loan Documents represent the final agreement between the parties and may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties. There are no unwritten oral agreements between the parties. Section 10.2. Survival of Agreements; Cumulative Nature. Borrower’s various representations, warranties, covenants and agreements in the Loan Documents shall survive the execution and delivery of this Agreement and the other Loan Documents and the performance hereof and thereof, including the making or granting of the Loans and the delivery of the Notes and the other Loan Documents, and shall further survive until all of the Obligations are paid in full to each Lender Party and all of Lender Parties’ obligations to Borrower are terminated.",
"The rights, powers, and privileges granted to Lender Parties in the Loan Documents, are cumulative, and, except for expressly specified waivers and consents, no Loan Document shall be construed in the context of another to diminish, nullify, or otherwise reduce the benefit to any Lender Party of any such right, power or privilege. Section 10.3. Notices. All notices, requests, consents, demands and other communications required or permitted under any Loan Document shall be in writing, unless otherwise specifically provided in such Loan Document (provided that Administrative Agent may give telephonic notices to the other Lender Parties), and shall be deemed sufficiently given or furnished if delivered by personal delivery, by facsimile or other electronic transmission, by delivery service with proof of delivery, or by registered or certified United States mail, postage prepaid, to Borrower at the address of Borrower specified on the signature pages hereto and to each Lender Party at its address specified on the signature pages hereto (unless changed by similar notice in writing given by the particular Person whose address is to be changed). Any such notice or communication shall be deemed to have been given (a) in the case of personal delivery or delivery service, as of the date of first attempted delivery during normal business hours at the address provided herein, (b) in the case of facsimile or other electronic transmission, upon receipt, or (c) in the case of registered or certified United States mail, three days after deposit in the mail; provided, however, that no Borrowing Notice or Continuation/Conversion Notice shall become effective until actually received by Administrative Agent. 54 -------------------------------------------------------------------------------- Section 10.4.",
"Payment of Expenses; Indemnity. (a) Payment of Expenses. Whether or not the transactions contemplated by this Agreement are consummated, Borrower will promptly (and in any event, within 30 days after any invoice or other statement or notice) pay: (i) all transfer, stamp, mortgage, documentary or other similar taxes, assessments or charges levied by any governmental or revenue authority in respect of this Agreement or any of the other Loan Documents or any other document referred to herein or therein, (ii) all reasonable costs and expenses incurred by or on behalf of Administrative Agent (including attorneys’ fees, consultants’ fees and engineering fees, travel costs and miscellaneous expenses) in connection with (1) the negotiation, preparation, execution and delivery of the Loan Documents, and any and all consents, waivers or other documents or instruments relating thereto, (2) the filing, recording, refiling and re-recording of any Loan Documents and any other documents or instruments or further assurances required to be filed or recorded or refiled or re-recorded by the terms of any Loan Document, (3) the borrowings hereunder and other action reasonably required in the course of administration hereof, (4) monitoring or confirming (or preparation or negotiation of any document related to) Borrower’s compliance with any covenants or conditions contained in this Agreement or in any Loan Document, and (iii) all reasonable costs and expenses incurred by or on behalf of any Lender Party (including attorneys’ fees, consultants’ fees and accounting fees) in connection with the defense or enforcement of any of the Loan Documents (including this section) or the defense of any Lender Party’s exercise of its rights thereunder.",
"In addition to the foregoing, until all Obligations have been paid in full, Borrower will also pay or reimburse Administrative Agent for all reasonable out-of-pocket costs and expenses of Administrative Agent or its agents or employees in connection with the continuing administration of the Loans and the related due diligence of Administrative Agent, including travel and miscellaneous expenses and fees and expenses of Administrative Agent’s outside counsel and consultants engaged in connection with the Loan Documents.",
"(b) Indemnity. Borrower agrees to indemnify each Lender Party, upon demand, from and against any and all liabilities, obligations, claims, losses, damages, penalties, fines, actions, judgments, suits, settlements, costs, expenses or disbursements (including reasonable fees of attorneys, accountants, experts and advisors) of any kind or nature whatsoever (in this section collectively called “liabilities and costs”) which to any extent (in whole or in part) may be imposed on, incurred by, or asserted against such Lender Party growing out of, resulting from or in any other way associated with any of the Collateral, the Loan Documents and the transactions and events (including the enforcement or defense thereof) at any time associated therewith or contemplated therein and Borrower’s use of Loan proceeds (whether arising in contract or in tort or otherwise and including any violation or noncompliance with any Environmental Laws by any Lender Party or any other Person or any liabilities or duties of any Lender Party or any other Person with respect to Hazardous Materials found in or released into the environment).",
"The foregoing indemnification shall apply whether or not such liabilities and costs are in any way or to any extent owed, in whole or in part, under any claim or theory of strict liability or caused, in whole or in part, by any negligent act or omission of any kind by any Lender Party, provided only that no Lender Party shall be entitled under this section to receive indemnification for that portion, if any, of any liabilities and costs which is proximately caused by its own individual gross negligence or willful misconduct, as determined in a final judgment. If any Person (including Borrower or any of its Affiliates) ever alleges such gross negligence or willful misconduct by any Lender Party, the 55 -------------------------------------------------------------------------------- indemnification provided for in this section shall nonetheless be paid upon demand, subject to later adjustment or reimbursement, until such time as a court of competent jurisdiction enters a final judgment as to the extent and effect of the alleged gross negligence or willful misconduct. As used in this section the term “Lender Party” shall refer not only to each Person designated as such in Section 1.1 but also to each director, officer, trustee, agent, attorney, employee, representative and Affiliate of such Persons. (c) Interest.",
"Borrower hereby promises to each Lender Party interest at the Default Rate on all Obligations to pay fees or to reimburse or indemnify any Lender Party which Borrower has promised to pay to such Lender Party pursuant to this Section 10.4 and which are not paid when due. Such interest shall accrue from the date such Obligations become due until they are paid. Section 10.5. Parties in Interest; Assignments; Replacement Notes. (a) All grants, covenants and agreements contained in the Loan Documents shall bind and inure to the benefit of the parties thereto and their respective successors and permitted assigns; provided, however, that Borrower may not assign or transfer any of its rights or delegate any of its duties or obligations under any Loan Document without the prior consent of all Lenders.",
"Neither Borrower nor any Affiliates of Borrower shall directly or indirectly purchase or otherwise retire any Obligations owed to any Lender nor will any Lender accept any offer to do so, unless each Lender shall have received substantially the same offer with respect to the same Percentage Share of the Obligations owed to it. If Borrower or any Affiliate of Borrower at any time purchases some but less than all of the Obligations owed to all Lender Parties, such purchaser shall not be entitled to any rights of any Lender under the Loan Documents unless and until Borrower or its Affiliates have purchased all of the Obligations. (b) No Lender shall sell any participation interest in its commitment hereunder or any of its rights under its Loans or under the Loan Documents to any Person unless the agreement between such Lender and such participant at all times provides: (i) that such participation exists only as a result of the agreement between such participant and such Lender and that such transfer does not give such participant any right to vote as a Lender or any other direct claims or rights against any Person other than such Lender, (ii) that such participant is not entitled to payment from Borrower under Sections 3.2 through 3.6 of amounts in excess of those payable to such Lender under such sections (determined without regard to the sale of such participation), and (iii) unless such participant is an Affiliate of such Lender, that such participant shall not be entitled to require such Lender to take any action under any Loan Document or to obtain the consent of such participant prior to taking any action under any Loan Document, except for actions which would require the consent of all Lenders under subsection (a) of Section 10.1.",
"No Lender selling such a participation shall, as between the other parties hereto and such Lender, be relieved of any of its obligations hereunder as a result of the sale of such participation. Each Lender which sells any such participation to any Person (other than an Affiliate of such Lender) shall give prompt notice thereof to Administrative Agent and Borrower; provided, however, that no liability shall arise if any such Lender fails to give such notice to Borrower. (c) Except for sales of participations under the immediately preceding subsection, no Lender shall make any assignment or transfer of any kind of its commitments or any of its rights 56 -------------------------------------------------------------------------------- under its Loans or under the Loan Documents, except for assignments to an Eligible Transferee or, subject to the provisions of subsection (g) below, to an affiliate, and then only if such assignment is made in accordance with the following requirements: (i) In the case of an assignment by a Lender of less than all of its Loans, LC Obligations and any commitment hereunder, each such assignment shall apply to a consistent percentage of all Loans and LC Obligations owing to the assignor Lender hereunder and to the same percentage of the unused portion of the assignor Lender’s Percentage Share of the Maximum Loan Amount, so that after such assignment is made both the assignee Lender and the assignor Lender shall have a fixed (and not a varying) Percentage Share in its Loans and LC Obligations and be committed to make that Percentage Share of all future Loans and make that Percentage Share of all future participations in LC Obligations, and the Percentage Share of the Maximum Facility Amount of each of the assignor and assignee shall equal or exceed $5,000,000.",
"(ii) The parties to each such assignment shall execute and deliver to Administrative Agent, for its acceptance and recording in the “Register” (as defined below in this section), an Assignment and Acceptance in the form of Exhibit G, appropriately completed, together with the Note subject to such assignment and a processing fee payable by such assignor Lender (and not at Borrower’s expense) to Administrative Agent of $3,500. Upon such execution, delivery, and payment and upon the satisfaction of the conditions set out in such Assignment and Acceptance, then (i) Borrower shall issue new Notes to such assignor and assignee upon return of the old Notes to Borrower, and (ii) as of the “Settlement Date” specified in such Assignment and Acceptance the assignee thereunder shall be a party hereto and a Lender hereunder and Administrative Agent shall thereupon deliver to Borrower and each Lender a revised Schedule 1 hereto showing the revised Percentage Shares and total Percentage Shares of such assignor Lender and such assignee Lender and the revised Percentage Shares and total Percentage Shares of all other Lenders.",
"(iii) Each assignee Lender which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for Federal income tax purposes, shall (to the extent it has not already done so) provide Administrative Agent and Borrower with the “Prescribed Forms” referred to in Section 3.7(d). (d) Any Lender may at any time pledge all or any portion of its Loan and Note (and related rights under the Loan Documents including any portion of its Note) to any of the twelve (12) Federal Reserve Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or enforcement thereof shall release any such Lender from its obligations under any of the Loan Documents; provided that all related costs, fees and expenses in connection with any such pledge shall be for the sole account of such Lender. (e) By executing and delivering an Assignment and Acceptance, each assignee Lender thereunder will be confirming to and agreeing with Borrower, Administrative Agent and each other Lender Party that such assignee understands and agrees to the terms hereof, including Article IX hereof. 57 -------------------------------------------------------------------------------- (f) Administrative Agent shall maintain a copy of each Assignment and Acceptance and a register for the recordation of the names and addresses of Lenders and the Percentage Shares of, and principal amount of the Loans owing to, each Lender from time to time (in this section called the “Register”).",
"The entries in the Register shall be conclusive, in the absence of manifest error, and Borrower and each Lender Party may treat each Person whose name is recorded in the Register as a Lender Party hereunder for all purposes. The Register shall be available for inspection by Borrower or any Lender Party at any reasonable time and from time to time upon reasonable prior notice. (g) Any Lender may assign or transfer its commitment or its rights under its Loans or under the Loan Documents to (i) any Affiliate that is wholly-owned direct or indirect subsidiary of such Lender or of any Person that wholly owns, directly or indirectly, such Lender, or (ii) if such Lender is a fund that makes or invests in bank loans, any other fund that makes or invests in bank loans and is advised or managed by (A) the same investment advisor as any Lender or (B) any Affiliate of such investment advisor that is a wholly-owned direct or indirect subsidiary of any Person that wholly owns, directly or indirectly, such investment advisor, subject to the following additional conditions (x), (y) and (z), with respect to assignments pursuant to clause (i) above, and subject to the following additional conditions (y) and (z) with respect to assignments pursuant to clause (ii) above: (x) any right of such Lender assignor and such assignee to vote as a Lender, or any other direct claims or rights against any other Persons, shall be uniformly exercised by both such assignor and assignee or pursued in the manner that such Lender assignor would have so exercised such vote, claim or right if it had not made such assignment or transfer; and (y) such assignee shall not be entitled to payment from Borrower under Sections 3.2 through 3.7 of amounts in excess of those payable to such Lender assignor under such sections (determined without regard to such assignment or transfer); and (z) if such Lender assignor is a Lender that assigns or transfers to such assignee any of such Lender’s Percentage Share of any commitment hereunder, assignee may become primarily liable for such commitment, but such assignment or transfer shall not relieve or release such Lender from such commitment.",
"(h) Upon receipt of an affidavit reasonably satisfactory to Borrower of an officer of any Lender as to the loss, theft, destruction or mutilation of its Note which is not of public record, and, in the case of any such loss, theft, destruction or mutilation, upon cancellation of such Note, Borrower will execute and deliver, in lieu thereof, a replacement Note in the same principal amount thereof and otherwise of like tenor. Section 10.6. Confidentiality. Each Lender Party agrees (on behalf of itself and each of its Affiliates, and each of its and their directors, officers, agents, attorneys, employees, and representatives) that it (and each of them) will take all reasonable steps to keep confidential any non-public information supplied to it by or at the direction of Borrower so identified when 58 -------------------------------------------------------------------------------- delivered, provided, however, that this restriction shall not apply to (a) information which has at the time in question entered the public domain, other than as a result of a breach of this Section 10.6, (b) information which is required to be disclosed by Law (whether valid or invalid) of any Tribunal, (c) any disclosure to any Lender Party’s Affiliates, auditors, attorneys or agents (provided each such Person first agrees to hold such information in confidence on the terms provided in this Section 10.6), (d) any disclosure to any other Lender Party or to any purchaser or prospective purchaser of participations or other interests in any Loan or Loan Document (provided each such Person first agrees to hold such information in confidence on the terms provided in this section), or (e) any disclosure in the course of enforcing its rights and remedies during the existence of an Event of Default.",
"Notwithstanding anything herein to the contrary, confidential information shall not include, and each Lender Party and Borrower may disclose and may permit to be disclosed to any and all Persons, without limitation of any kind, the “tax treatment” and “tax structure” (in each case, within the meaning of Treasury Regulation Section 1.6011-4) of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses) that are or have been provided to such Lender Party or Borrower relating to such tax treatment and tax structure. Section 10.7. Governing Law; Submission to Process. Except to the extent that the Law of another jurisdiction is expressly elected in a Loan Document, the Loan Documents shall be deemed contracts and instruments made under the Laws of the State of New York and shall be construed and enforced in accordance with and governed by the Laws of the State of New York and the Laws of the United States of America, without regard to principles of conflicts of law.",
"Borrower hereby agrees that any legal action or proceeding against Borrower with respect to this Agreement, the Notes or any of the Loan Documents may be brought in the courts of the State of New York or of the United States of America for the Southern District of New York as Lender Parties may elect, and, by execution and delivery hereof, Borrower accepts and consents for itself and in respect to its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each Borrower agrees that Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York shall apply to the Loan Documents and waives any right to stay or to dismiss any action or proceeding brought before said courts on the basis of forum non conveniens. In furtherance of the foregoing, Borrower hereby irrevocably designates and appoints Corporation Service Company, 80 State Street, Albany, New York 12207, as agent of Borrower to receive service of all process brought against Borrower with respect to any such proceeding in any such court in New York, such service being hereby acknowledged by Borrower to be effective and binding service in every respect. Copies of any such process so served shall also, if permitted by Law, be sent by registered mail to Borrower at its address set forth below, but the failure of Borrower to receive such copies shall not affect in any way the service of such process as aforesaid.",
"Borrower shall furnish to Lender Parties a consent of Corporation Service Company agreeing to act hereunder prior to the effective date of this agreement. Nothing herein shall affect the right of Lender Parties to serve process in any other manner permitted by Law or shall limit the right of Lender Parties to bring proceedings 59 -------------------------------------------------------------------------------- against Borrower in the courts of any other jurisdiction. If for any reason Corporation Service Company shall resign or otherwise cease to act as Borrower’s agent, Borrower hereby irrevocably agrees to (a) immediately designate and appoint a new agent acceptable to Administrative Agent to serve in such capacity and, in such event, such new agent shall be deemed to be substituted for Corporation Service Company for all purposes hereof and (b) promptly deliver to Administrative Agent the written consent (in form and substance satisfactory to Administrative Agent) of such new agent agreeing to serve in such capacity. Section 10.8. Limitation on Interest.",
"Lender Parties, Borrower and any other parties to the Loan Documents intend to contract in strict compliance with applicable usury Law from time to time in effect. In furtherance thereof such Persons stipulate and agree that none of the terms and provisions contained in the Loan Documents shall ever be construed to create a contract to pay, for the use, forbearance or detention of money, interest in excess of the maximum amount of interest permitted to be contracted for, charged, or received by applicable Law from time to time in effect. Neither Borrower nor any present or future guarantors, endorsers, or other Persons hereafter becoming liable for payment of any Obligation shall ever be liable for unearned interest thereon or shall ever be required to pay interest thereon in excess of the maximum amount that may be lawfully contracted for, charged, or received under applicable Law from time to time in effect, and the provisions of this section shall control over all other provisions of the Loan Documents which may be in conflict or apparent conflict herewith.",
"Lender Parties expressly disavow any intention to contract for, charge, or receive excessive unearned interest or finance charges in the event the maturity of any Obligation is accelerated. If (a) the maturity of any Obligation is accelerated for any reason, (b) any Obligation is prepaid and as a result any amounts held to constitute interest are determined to be in excess of the legal maximum, or (c) any Lender or any other holder of any or all of the Obligations shall otherwise collect moneys which are determined to constitute interest which would otherwise increase the interest on any or all of the Obligations to an amount in excess of that permitted to be contracted for, charged or received by applicable Law then in effect, then all sums determined to constitute interest in excess of such legal limit shall, without penalty, be promptly applied to reduce the then outstanding principal of the related Obligations or, at such Lender’s or holder’s option, promptly returned to Borrower or other payor thereof upon such determination. In determining whether or not the interest paid or payable, under any specific circumstance, exceeds the maximum amount permitted under applicable Law, Lender Parties and Borrower (and any other payors thereof) shall to the greatest extent permitted under applicable Law, (i) characterize any non-principal payment as an expense, fee or premium rather than as interest, (ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize, prorate, allocate, and spread the total amount of interest throughout the entire contemplated term of the instruments evidencing the Obligations in accordance with the amounts outstanding from time to time thereunder and the maximum legal rate of interest from time to time in effect under applicable Law in order to lawfully charge the maximum amount of interest permitted under applicable Law.",
"In the event applicable Law provides for an interest ceiling under Chapter 303 of the Texas Finance Code (the “Texas Finance Code”) as amended, to the extent that the Texas Finance Code is mandatorily applicable to any Lender, for that day, the ceiling shall be the “weekly ceiling” as defined in the Texas Finance Code, provided that if any applicable Law permits greater interest, the Law 60 -------------------------------------------------------------------------------- permitting the greatest interest shall apply. In no event shall Chapter 346 of the Texas Finance Code apply to this Agreement or any other Loan Document, or any transactions or loan arrangement provided or contemplated hereby or thereby. Section 10.9. Right of Offset. At any time and from time to time during the continuance of any Event of Default, each Lender is hereby authorized to offset against the Obligations then due and payable (without notice to Borrower), (a) any and all moneys, securities or other property (and the proceeds therefrom) of Borrower now or hereafter held or received by or in transit to any Lender from or for the account of Borrower, whether for safekeeping, custody, pledge, transmission, collection or otherwise, (b) any and all deposits (general or special, time or demand, provisional or final) of Borrower with any Lender, and (c) any other credits and claims of Borrower at any time existing against any Lender, including claims under certificates of deposit.",
"Section 10.10. Termination; Limited Survival. In its sole and absolute discretion Borrower may at any time that no Obligations are owing or outstanding elect in a written notice delivered to Administrative Agent to terminate this Agreement. Upon receipt by Administrative Agent of such a notice, if no Obligations are then owing or outstanding this Agreement and all other Loan Documents shall thereupon be terminated and the parties thereto released from all prospective obligations thereunder. Notwithstanding the foregoing or anything herein to the contrary, any waivers or admissions made by Borrower in any Loan Document, any Obligations under Sections 3.2 through 3.6, and any obligations which any Person may have to indemnify or compensate any Lender Party shall survive any termination of this Agreement or any other Loan Document. At the request and expense of Borrower, Administrative Agent shall prepare and execute all necessary instruments to reflect and effect such termination of the Loan Documents.",
"Administrative Agent is hereby authorized to execute all such instruments on behalf of all Lenders, without the joinder of or further action by any Lender. Section 10.11. Severability. If any term or provision of any Loan Document shall be determined to be illegal or unenforceable all other terms and provisions of the Loan Documents shall nevertheless remain effective and shall be enforced to the fullest extent permitted by applicable Law. Section 10.12. Counterparts. This Agreement may be separately executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to constitute one and the same Agreement. Section 10.13. Waiver of Jury Trial, Punitive Damages, etc.",
"Borrower and Lender Parties mutually hereby knowingly, voluntarily, and intentionally waive the right to a trial by jury in respect of any claim based hereon, arising out of, under or in connection with, this Agreement or any other Loan Documents contemplated to be executed in connection herewith or any course of conduct, course of dealings, statements (whether verbal or written) or actions of any party. This waiver constitutes a material inducement for Lenders to enter into this Agreement and the other Loan Documents and make the Loans. Borrower and each Lender Party hereby further (a) irrevocably waives, to the maximum 61 -------------------------------------------------------------------------------- extent not prohibited by Law, any right it may have to claim or recover in any such litigation any “Special Damages,” as defined below, (b) certifies that no party hereto nor any representative or agent or counsel for any party hereto has represented, expressly or otherwise, or implied that such party would not, in the event of litigation, seek to enforce the foregoing waivers, and (c) acknowledges that it has been induced to enter into this Agreement, the other Loan Documents and the transactions contemplated hereby and thereby by, among other things, the mutual waivers and certifications contained in this section. As used in this section, “Special Damages” includes all special, consequential, exemplary, or punitive damages (regardless of how named), but does not include any payments or funds which any party hereto has expressly promised to pay or deliver to any other party hereto. Section 10.14. Replacement Credit Facility.",
"Borrower states and acknowledges that this Agreement is entered into by it in replacement of that certain Second Amended and Restated Credit Agreement [Letter of Credit and Hedged Inventory Facility] dated July 2, 2002 (the “Expiring LC Facility”), among Borrower, Fleet National Bank as administrative agent and the lenders party thereto. Borrower further states, acknowledges and agrees that the preceding sentence does not and shall not alter or otherwise modify in any regard, directly or indirectly, expressly or impliedly or otherwise, (i) any termination of the Expiring LC Facility or, among other things, the termination of the Liens created to secure the Expiring LC Facility or (ii) the terms, provisions and conditions expressly set forth in, and contemplated by, this Agreement, or the transactions contemplated hereby, which in each case shall be governed solely by the terms, provisions and conditions of this Agreement and the other Loan Documents without regard to this Section 10.14; and for the avoidance of any doubt, such preceding sentence does not and shall not alter or modify in any regard, directly or indirectly, expressly or impliedly or otherwise, the discretionary and un-committed nature of the credit facility referred to herein.",
"[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.] 62 -------------------------------------------------------------------------------- IN WITNESS WHEREOF, this Agreement is executed as of the date first written above. Borrower: PLAINS MARKETING, L.P. By: PLAINS MARKETING GP INC., its general partner By: Al Swanson, Treasurer Address for Borrower: 333 Clay Street, Suite 1600 Houston, Texas 77002 Attention: Al Swanson Telephone: (713) 646-4455 Fax: (713) 646-4564 PAA Website: www.paalp.com 63 -------------------------------------------------------------------------------- FLEET NATIONAL BANK, Administrative Agent, LC Issuer and a Lender By: Terrence Ronan, Managing Director FLEET SECURITIES, INC., Lead Arranger and Book Manager By: Michael P. Hannon, Managing Director 64 -------------------------------------------------------------------------------- BNP PARIBAS, a Lender By: Name: Title: By: Name: Title: 65 -------------------------------------------------------------------------------- SOCIETE GENERALE, a Lender By Name: Title: 66 -------------------------------------------------------------------------------- SCHEDULE 1 LENDER SCHEDULE Lender Percentage Share of Maximum Facility Amount Percentage Share(1) Fleet National Bank $ 100,000,000.00 50.000000 % BNP Paribas $ 75,000,000.00 37.500000 % Societe Generale $ 25,000,000.00 12.500000 % TOTALS $ 200,000,000.00 100.000000 % -------------------------------------------------------------------------------- (1) Rounded to six decimal places -------------------------------------------------------------------------------- LENDER INFORMATION Lender Contact Domestic Lending Office LIBOR Lending Office Fleet National Bank 100 Federal Street Energy & Utilities MADE 10009H vice MADE 10008D Boston, Massachusetts 02110 Attn: Terrence Ronan Phone: 617-434-5472 Fax: 617-434-3652 100 Federal Street Boston, Massachusetts 02110 100 Federal Street Boston, Massachusetts 02110 BNP Paribas 787 7th Avenue New York, New York 10019 Attn: Ed Chin Phone: 212-841-2020 Fax: 212-841-2536 787 7th Avenue New York, New York 10019 787 7th Avenue New York, New York 10019 Societe Generale 1221 Avenue of the Americas New York, New York 10020 Attn: Jordan Nenoff Phone: 212-278-7407 Fax: 212-278-7417 1221 Avenue of the Americas New York, New York 10020 1221 Avenue of the Americas New York, New York 10020 -------------------------------------------------------------------------------- SCHEDULE 3 SECURITY SCHEDULE 1.",
"Security Agreement of even date herewith by Borrower in favor of Administrative Agent, for the benefit of Lenders, covering Hedged Eligible Inventory, Hedging Contracts, Petroleum Product sales contracts and Accounts therefrom and proceeds thereof as from time to time specified by Borrower (the “Security Agreement”). 2. UCC-1 Financing Statement naming Borrower as debtor and Administrative Agent as secured party, covering the Collateral described in the Security Agreement. -------------------------------------------------------------------------------- SCHEDULE 4 PRICING GRID Applicable Rating Level Applicable Margin Base Rate Loans Applicable Margin LIBOR Loans and LC Fee Rate Level I 0.000 % 0.375 % Level II 0.000 % 0.500 % Level III 0.000 % 0.750 % Level IV 0.000 % 1.000 % -------------------------------------------------------------------------------- SCHEDULE 5 CURRENTLY APPROVED PERSONS AND FACILITIES -------------------------------------------------------------------------------- EXHIBIT A NOTE $ New York, New York , 200 FOR VALUE RECEIVED, the undersigned, Plains Marketing, L.P., a Delaware limited partnership (herein called “Borrower”), hereby promises to pay to the order of (herein called “Lender”), the principal sum of ($ ), or, if greater or less, the aggregate unpaid principal amount of the Loans made under this Note by Lender to Borrower pursuant to the terms of the Credit Agreement (as hereinafter defined), together with interest on the unpaid principal balance thereof as hereinafter set forth, both principal and interest payable as herein provided in lawful money of the United States of America at the offices of Administrative Agent under the Credit Agreement, as from time to time may be designated by the holder of this Note.",
"This Note (a) is issued and delivered under that certain Credit Agreement dated November 21, 2003 among Borrower, Fleet National Bank, as Administrative Agent, and the lenders (including Lender) referred to therein (herein, as from time to time supplemented, amended or restated, called the “Credit Agreement”), and is a “Note” as defined therein, (b) is subject to the terms and provisions of the Credit Agreement, which contains provisions for payments and prepayments hereunder and acceleration of the maturity hereof upon the happening of certain stated events, and (c) is guaranteed by and entitled to the benefits of certain guaranties (as identified in the Credit Agreement).",
"Payments on this Note shall be made and applied as provided herein and in the Credit Agreement. Reference is hereby made to the Credit Agreement for a description of certain rights, limitations of rights, obligations and duties of the parties hereto and for the meanings assigned to terms used and not defined herein and to the guaranties for a description of the nature and extent of the guarantee thereby provided and the rights of the parties thereto. The principal amount of this Note shall bear interest and shall be due and payable from time to time as provided in the Credit Agreement with the remaining unpaid principal balance of this Note being due and payable in full on or before the Maturity Date.",
"Accrued and unpaid interest hereon shall be due and payable on each Interest Payment Date as provided in the Credit Agreement and on the Maturity Date. Notwithstanding the foregoing paragraph and all other provisions of this Note, in no event shall the interest payable hereon, whether before or after maturity, exceed the maximum interest which, under applicable Law, may be charged on this Note, and this Note is expressly made subject to the provisions of the Credit Agreement which more fully set out the limitations on how interest accrues hereon. If this Note is placed in the hands of an attorney for collection after default, or if all or any part of the indebtedness represented hereby is proved, established or collected in any court or in any bankruptcy, receivership, debtor relief, probate or other court proceedings, Borrower and 1 -------------------------------------------------------------------------------- all endorsers, sureties and guarantors of this Note jointly and severally agree to pay reasonable attorneys’ fees and collection costs to the holder hereof in addition to the principal and interest payable hereunder. Borrower and all endorsers, sureties and guarantors of this Note hereby severally waive demand, presentment, notice of demand and of dishonor and nonpayment of this Note, protest, notice of protest, notice of intention to accelerate the maturity of this Note, declaration or notice of acceleration of the maturity of this Note, diligence in collecting, the bringing of any suit against any party and any notice of or defense on account of any extensions, renewals, partial payments or changes in any manner of or in this Note or in any of its terms, provisions and covenants, or any releases or substitutions of any security, or any delay, indulgence or other act of any trustee or any holder hereof, whether before or after maturity.",
"This Note and the rights and duties of the parties hereto shall be governed by the Laws of the State of New York (without regard to principles of conflicts of law), except to the extent the same are governed by applicable federal Law. PLAINS MARKETING, L.P. By: PLAINS MARKETING GP INC., its general partner By: Name: Title: 2 -------------------------------------------------------------------------------- EXHIBIT B-1 FINANCING REQUEST-INITIAL Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement. Pursuant to the terms of the Agreement, Borrower hereby requests Lenders to finance Cash and Carry Purchases or storage of Hedged Eligible Inventory as set forth on the attached Schedule, by participating in Letters of Credit to secure such Cash and Carry Purchases and/or make Loans to finance such Cash and Carry Purchases or storage of such Hedged Eligible Inventory for the following: Delivery Month: , 200 Sale/Purchase Month: , 200 Funding Date (Settlement Date for Delivery Month): , 200 Hedged Value of Hedged Eligible Inventory: $ Initial Financing Request (90% of Hedged Value): $ To induce Lenders to commit to finance such Cash and Carry Purchases or storage of such Hedged Eligible Inventory, Borrower hereby represents, warrants, acknowledges, and agrees to and with Administrative Agent and each Lender that: (a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower.",
"(b) The representations and warranties of Borrower set forth in the Agreement and the other Loan Documents are true and correct on and as of the date hereof (except to the extent that such representation or warranty was made as of a specific date, or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date), with the same effect as though such representations and warranties had been made on and as of the date hereof. (c) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the financing requested hereby. Borrower will use all Letters of Credit and Loans hereby requested in compliance with Section 2.5 of the Agreement.",
"1 -------------------------------------------------------------------------------- (d) The Facility Usage, after the issuance of Letters of Credit and/or the making of the requested Loans contemplated hereby, will not be in excess of the Maximum Facility Amount on the date requested for the issuance of such Letters of Credit or the making of such Loans. (e) The Petroleum Products inventory described on the attached Schedule, when purchased by Borrower, will (i) qualify as Hedged Eligible Inventory as defined in the Agreement, (ii) be located at the Approved Locations set forth on the attached Schedule and (iii) be subject to the Hedging Contracts listed on the attached Schedule, with the Hedged Value set forth thereon. Borrower hereby grants a lien on and security interest in all Petroleum Products listed on the attached Schedule, the related Hedging Contracts specified thereon, to the extent such Hedging Contracts pertain or relate to such Petroleum Products, all sales contracts now or hereafter entered into with respect to such Petroleum Products, to the extent such sales contracts pertain or relate to such Petroleum Products, all Accounts arising therefrom, and all proceeds thereof, in favor of Administrative Agent for the benefit of Lenders, and expressly acknowledges and agrees that all such Petroleum Products, Hedging Contracts, sales contracts, Accounts and proceeds constitute “Collateral” as defined in the Security Agreement, and Borrower and Administrative Agent, by its acceptance hereof, hereby agree that the Security Agreement, and the definition of “Collateral” set forth therein, is hereby supplemented hereby. (f) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement.",
"The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects. The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects. IN WITNESS WHEREOF, this instrument is executed as of , . PLAINS MARKETING, L.P. By: PLAINS MARKETING GP INC., its general partner By: Name: Title: 2 -------------------------------------------------------------------------------- EXHIBIT B-2 FINANCING REQUEST-FINAL Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement. Pursuant to the terms of the Agreement and that certain Financing Request-Initial dated , 200 (the “Initial Request), Borrower hereby amends and supplements such Initial Request and the Schedule thereto as follows: Delivery Month: , 200 Sale/Purchase Month: , 200 Funding Date (Settlement Date for Delivery Month): , 200 Sale Value of Hedged Eligible Inventory: $ Final Financing Request: $ (90% of lesser of (i) Sale Value and (ii) 110% of Hedged Value as set forth in Initial Request) [In addition, Borrower hereby requests each Participating Lender consent to financing its Percentage Share of an additional amount equal to the amount by which the Sale Value of such Financed Hedged Eligible Inventory as set forth on the attached Schedule exceeds 110% of the Hedged Value of such Financed Hedged Eligible Inventory as set forth in the Initial Request].",
"To induce Participating Lenders to make such Loans, Borrower hereby represents, warrants, acknowledges, and agrees to and with Administrative Agent and each Participating Lender that: (a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower. (b) The representations and warranties of Borrower set forth in the Agreement and the other Loan Documents are true and correct on and as of the date hereof (except to the extent that such representation or warranty was made as of a specific date, or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date), with the same effect as though such representations and warranties had been made on and as of the date hereof.",
"1 -------------------------------------------------------------------------------- (c) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the Loans requested hereby. Borrower will use the Loans hereby requested in compliance with Section 2.5 of the Agreement. (d) The Facility Usage, after the making of the Loans requested hereby, will not be in excess of the Maximum Facility Amount on the date requested for the making of such Loans. (e) The Petroleum Products inventory described on the attached Schedule (i) qualifies as Hedged Eligible Inventory as defined in the Agreement, (ii) is located at the Approved Locations set forth on the attached Schedule, (iii) is subject to the Hedging Contracts listed on the attached Schedule, (iv) is subject to the sales contracts listed on the attached Schedule, with the Sale Value set forth thereon.",
"Borrower hereby grants a lien on and security interest in all Petroleum Products listed on the attached Schedule, the related Hedging Contracts specified thereon, to the extent such Hedging Contracts pertain or relate to such Petroleum Products, the sales contracts listed on the attached Schedule and all other sales contracts now or hereafter entered into with respect to such Petroleum Products, to the extent such sales contracts pertain or related to such Petroleum Products, all Accounts arising therefrom, and all proceeds thereof, in favor of Administrative Agent for the benefit of Lenders, and expressly acknowledges and agrees that all such Petroleum Products, Hedging Contracts, sales contracts, Accounts and proceeds constitute “Collateral” as defined in the Security Agreement, and Borrower and Administrative Agent, by its acceptance hereof, hereby agree that the Security Agreement, and the definition of “Collateral” set forth therein, is hereby supplemented hereby. (f) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement.",
"The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects. 2 -------------------------------------------------------------------------------- The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects. IN WITNESS WHEREOF, this instrument is executed as of , . PLAINS MARKETING, L.P. By: PLAINS MARKETING GP INC., its general partner By: Name: Title: 3 -------------------------------------------------------------------------------- EXHIBIT B-3 BORROWING NOTICE Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”).",
"Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement. Pursuant to the terms of the Agreement and that certain Financing Request-Final dated , 200 (the “Final Request”), Borrower hereby requests the Participating Lenders set forth below to make Loans to Borrower in the aggregate principal amount of $ and specifies the Funding Date set forth below as the date Borrower desires for Lenders to make such Loans and for Administrative Agent to deliver to Borrower the proceeds thereof. Delivery Month: , 200 Participating Lenders: Funding Date (Settlement Date for Delivery Month): , 200 Type of Loan: [LIBOR Loans] [Base Rate Loans] Length of Interest Rate for LIBOR Loan (1 month): To induce Participating Lenders to make such Loans, Borrower hereby represents, warrants, acknowledges, and agrees to and with Administrative Agent and each Participating Lender that: (a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower.",
"(b) The representations and warranties of Borrower set forth in the Agreement and the other Loan Documents, including the Final Request) are true and correct on and as of the date hereof (except to the extent that such representation or warranty was made as of a specific date, or updated, modified or supplemented as of a subsequent date with the consent of Majority Lenders, then in each such case, such other date), with the same effect as though such representations and warranties had been made on and as of the date hereof. (c) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the 1 -------------------------------------------------------------------------------- Loans requested hereby. Borrower will use the Loans hereby requested in compliance with Section 2.5 of the Agreement.",
"(d) The Facility Usage, after the making of the Loans requested hereby, will not be in excess of the Maximum Facility Amount on the date requested for the making of such Loans. (e) The Loans requested hereby will not be in excess of 90% of the lesser of (i) the Sale Value of the Hedged Eligible Inventory as set forth in the Final Request and (ii) 110% of Hedged Value as set forth in Initial Request (as defined in the Final Request). (f) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement. The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects. The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects. IN WITNESS WHEREOF, this instrument is executed as of , . PLAINS MARKETING, L.P. By: PLAINS MARKETING GP INC., its general partner By: Name: Title: 2 -------------------------------------------------------------------------------- EXHIBIT C CONTINUATION/CONVERSION NOTICE Reference is made to that certain Credit Agreement dated November 21, 2003 among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”).",
"Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement. Borrower hereby requests a conversion or continuation of existing Loans into a new Borrowing pursuant to Section 2.4 of the Agreement as follows: Existing Borrowing(s) of Loans to be Continued or Converted: $ of LIBOR Loans with Interest Period ending $ of Base Rate Loans Aggregate amount of new Borrowing: $ Type of Loans in new Borrowing: Date of Continuation or Conversion: Length of Interest Period for LIBOR Loans (1, 2, 3, 6, or 12 months): months Borrower hereby represents, warrants, acknowledges, and agrees to and with each Lender that: (a) The officer or authorized agent of GP Inc. signing this instrument is the duly elected, qualified and acting officer or authorized agent of GP Inc. as indicated below such officer’s signature hereto having all necessary authority to act for the Borrower. (b) There does not exist on the date hereof any condition or event which constitutes a Default which has not been waived in writing as provided in Section 10.1(a) of the Agreement; nor will any such Default exist upon receipt and application of the Loans requested hereby.",
"(c) The Loan Documents have not been modified, amended or supplemented by any unwritten representations or promises, by any course of dealing, or by any other means not provided for in Section 10.1(a) of the Agreement. The Agreement and the other Loan Documents are hereby ratified, approved, and confirmed in all respects. 1 -------------------------------------------------------------------------------- The officer or authorized agent of GP Inc. signing this instrument hereby certifies that, to the best of his knowledge after due inquiry, the above representations, warranties, acknowledgments, and agreements of Borrower are true, correct and complete in all material respects. IN WITNESS WHEREOF, this instrument is executed as of , . PLAINS MARKETING, L.P. By: PLAINS MARKETING GP INC., its general partner By: Name: Title: 2 -------------------------------------------------------------------------------- EXHIBIT D-1 OPINION OF IN-HOUSE COUNSEL TO BORROWER 3 -------------------------------------------------------------------------------- EXHIBIT D-2 OPINION OF FULBRIGHT & JAWORSKI, L.L.P., COUNSEL TO BORROWER 4 -------------------------------------------------------------------------------- EXHIBIT E LETTER OF CREDIT APPLICATION AND AGREEMENT 5 -------------------------------------------------------------------------------- EXHIBIT F Irrevocable Standby Letter of Credit DATE: BENEFICIARY CONFIRMING OUR CABLE OF TODAY Credit Number: Dear Sir or Madam: BY ORDER OF: PLAINS MARKETING, L.P. HOUSTON, TX 77002 We hereby open in your favor our Irrevocable Standby Letter of Credit for the account of PLAINS MARKETING, L.P. for a sum of approximately US DOLLARS ( ) available by your draft(s) at SIGHT on OURSELVES effective and expiring at OUR COUNTERS on . DRAFTS MUST BE ACCOMPANIED BY: 1. COPY(IES) OF COMMERCIAL INVOICE(S) MARKED “UNPAID” ISSUED TO PLAINS MARKETING, L.P.",
"COVERING CRUDE OIL DELIVERED IN , . 2. WARRANTY OF TITLE ISSUED TO PLAINS MARKETING, L.P. AND SIGNED BY AN AUTHORIZED REPRESENTATIVE OF CERTIFYING THAT “IN CONSIDERATION OF YOUR PAYMENT OF THE ATTACHED INVOICE, WE HEREBY EXPRESSLY WARRANT THAT WE HAD MARKETABLE TITLE TO SUCH MATERIAL, AND THAT WE HAD FULL RIGHT AND AUTHORITY TO TRANSFER AND EFFECT DELIVERY OF SUCH MATERIAL TO YOU OR YOUR ASSIGNS AND HEREBY AGREE TO PROTECT, INDEMNIFY AND HOLD PLAINS MARKETING, L.P.",
"HARMLESS FROM AND AGAINST ANY AND ALL COSTS, DAMAGES, EXPENSES, AND CLAIMS, INCLUDING BUT NOT LIMITED TO REASONABLE ATTORNEY’S FEES, WHICH YOU MIGHT SUFFER OR INCUR ARISING OR RESULTING FROM ANY BREACH OF THE ABOVE WARRANTY.” 3. A STATEMENT SIGNED BY AN AUTHORIZED REPRESENTATIVE OF STATING THAT: HEREBY CERTIFIES THAT INVOICED QUANTITIES OF 1 -------------------------------------------------------------------------------- PRODUCT HAVE BEEN DELIVERED FREE AND CLEAR OF ALL LIENS AND ENCUMBRANCES TO PLAINS MARKETING, L.P. WHICH HAS FAILED TO PAY FOR THIS PRODUCT, AND THE MONIES HEREBY DRAWN ARE DUE AND PAYABLE. SPECIAL CONDITIONS: A. THIS LETTER OF CREDIT IS AVAILABLE FOR PAYMENT AT SIGHT BUT NOT PRIOR TO , . B. THE AMOUNT AVAILABLE FOR DRAWING UNDER THIS LETTER OF CREDIT WILL BE REDUCED BY THE AMOUNT OF ANY PAYMENT(S) MADE OUTSIDE THIS LETTER OF CREDIT TO BY PLAINS MARKETING, L.P. FOR THIS PRODUCT IF SUCH PAYMENT(S) IS/ARE MADE THROUGH FLEET NATIONAL BANK, BOSTON, MA REFERENCING THIS LETTER OF CREDIT NUMBER. C. ALL BANKING CHARGES OTHER THAN THOSE OF FLEET NATIONAL BANK ARE FOR THE ACCOUNT OF THE BENEFICIARY. D. PARTIAL DRAWINGS AND PARTIAL SHIPMENTS ARE PERMITTED.",
"E. COMMERCIAL INVOICE(S) REFERENCED ABOVE IN EXCESS OF THE U.S. DOLLAR AMOUNT OF THIS LETTER OF CREDIT IS (ARE) ACCEPTABLE; HOWEVER, PAYMENT NOT TO EXCEED THE VALUE OF THIS LETTER OF CREDIT. F. DOCUMENTS PRESENTED MORE THAN TWENTY-ONE DAYS AFTER THE TRANSPORT DATE BUT WITHIN THE VALIDITY OF THIS CREDIT ARE ACCEPTABLE. Except so far as otherwise expressly stated herein, this letter of credit is subject to the “Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500.” We hereby agree that drafts drawn under and in compliance with the terms of this letter of credit will be duly honored if presented to the above-mentioned drawee bank on or before , . The word “approximately”, insofar as it refers to the amount of this credit, is to be construed as allowing a difference not to exceed 10% more or 10% less. 2 -------------------------------------------------------------------------------- Kindly address all correspondence regarding this letter of credit to the attention of our Letter of Credit Operations, P.O.",
"Box 1763, BOSTON, MA 02105, attention , mentioning our reference number as it appears above. Telephone inquiries can be made to at . Very truly yours, Authorized Official 3 -------------------------------------------------------------------------------- EXHIBIT G ASSIGNMENT AND ACCEPTANCE Reference is made to that certain Credit Agreement dated as of November 21, 2003 (as from time to time amended, the “Agreement”), by and among Plains Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and certain financial institutions (“Lenders”). Terms which are defined in the Agreement are used herein with the meanings given them in the Agreement. The “Assignor” and the “Assignee” referred to on Schedule 1 agree as follows: 1. The Assignor hereby sells and assigns to the Assignee, without recourse and without representation or warranty except as expressly set forth herein, and the Assignee hereby purchases and assumes from the Assignor, an interest in and to the Assignor’s rights and obligations under the Agreement and the other Loan Documents as of the date hereof equal to the percentage interest specified on Schedule 1 of all outstanding rights and obligations under the Agreement and the other Loan Documents with respect to the Loans and commitment, if any.",
"After giving effect to such sale and assignment, the Assignee’s amount of the Loans owing to the Assignee will be as set forth on Schedule 1. 2. The Assignor (i) represents and warrants that it is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any adverse claim; (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Loan Documents or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any other instrument or document furnished pursuant thereto; (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of Borrower or the performance or observance by Borrower of any of its obligations under the Loan Documents or any other instrument or document furnished pursuant thereto; and (iv) attaches the Note held by the Assignor and requests that Administrative Agent exchange such Note for [a new Note payable to the order of the Assignee] [new Notes in an amount equal to Assignee’s Percentage Share of the Maximum Facility Amount assumed by the Assignee pursuant hereto and to the Assignor in an amount equal to its Percentage Share of the Maximum Facility Amount retained by the Assignor, if any], as specified on Schedule 1. 3.",
"The Assignee (i) confirms that it has received a copy of the Agreement, together with copies of the financial statements referred to in Section 6.2 thereof and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (ii) agrees that it will, independently and without reliance upon Administrative Agent, the Assignor or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Agreement; (iii) confirms that it is an Eligible Transferee, (iv) appoints and authorizes Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Agreement as are delegated to Administrative Agent by the terms thereof, together with such powers and discretion 1 -------------------------------------------------------------------------------- as are reasonably incidental thereto; (v) agrees that it will perform in accordance with their terms all of the obligations that by the terms of the Agreement are required to be performed by it as a Lender; and (vi) attaches any U.S. Internal Revenue Service or other forms required under Section 10.5. 4. Following the execution of this Assignment and Acceptance, it will be delivered to Administrative Agent for acceptance and recording by Administrative Agent.",
"The effective date for this Assignment and Acceptance (the “Effective Date”) shall be the date of acceptance hereof by Administrative Agent, unless otherwise specified on Schedule 1. 5. Upon such acceptance and recording by Administrative Agent, as of the Effective Date, (i) the Assignee shall be a party to the Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and (ii) the Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Agreement. 6. Upon such acceptance and recording by Administrative Agent, from and after the Effective Date, Administrative Agent shall make all payments under the Agreement and the Notes in respect of the interest assigned hereby (including, without limitation, all payments of principal, interest and commitment fees with respect thereto) to the Assignee. The Assignor and Assignee shall make all appropriate adjustments in payments under the Agreement and the Notes for periods prior to the Effective Date directly between themselves. 7. This Assignment and Acceptance shall be governed by, and construed in accordance with, the Laws of the State of New York.",
"8. This Assignment and Acceptance may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall be effective as delivery of a manually executed counterpart of this Assignment and Acceptance. IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule 1 to this Assignment and Acceptance to be executed by their officers thereunto duly authorized as of the date specified thereon. 2 -------------------------------------------------------------------------------- SCHEDULE 1 to ASSIGNMENT AND ACCEPTANCE Assignee’s Percentage Share of Maximum Facility Amount: $ Assignee’s Percentage Share: % Aggregate outstanding principal amount of Loans assigned: $ Principal amount of Note payable to Assignee: $ Principal amount of Note payable to Assignor (if retained): $ ] Effective Date (if other than date of acceptance by Administrative Agent: * , 200 [NAME OF ASSIGNOR], as Assignor By: Title: Dated: , 200 [NAME OF ASSIGNEE], as Assignee By: Title: Domestic Lending Office: LIBOR Lending Office: -------------------------------------------------------------------------------- * This date should be no earlier than five Business Days after the delivery of this Assignment and Acceptance to Administrative Agent.",
"Accepted this day of , 200 FLEET NATIONAL BANK By: Title: [Approved this day of , 200 [PLAINS MARKETING, L.P. By: PLAINS MARKETING GP INC., its general partner By: Title: --------------------------------------------------------------------------------"
] | https://github.com/TheAtticusProject/cuad | Legal & Government | https://huggingface.co/datasets/pile-of-law/pile-of-law |
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