E.D. Va. Notes Split Re Whether Doctrine of Unclean Hands Applies in Civil RICO Claims

Per Smithfield Foods, Inc. v. United Food and Commercial Workers Intern. Union, --- F.Supp.2d ----, 2008 WL 4610312 (E.D.Va. Oct. 14, 2008):

The Defendants have asserted the affirmative defense of “unclean hands.” The well-recognized doctrine of unclean hands prevents a plaintiff from obtaining equitable relief, if the plaintiff has been “guilty of any inequitable or wrongful conduct with respect to the transaction or subject matter sued on.” WorldCom, Inc. v. Boyne, 68 Fed. Appx. 447, 451 (4th Cir.2003). It is unclear, however, both nationally and in the Fourth Circuit, whether the doctrine of unclean hands applies in civil RICO claims.

The circuit courts are currently divided on this issue. The First Circuit, in Roma Construction Co. v. Russo, 96 F.3d 566, 571-75 (1st Cir.1996), suggested that the doctrine does not apply, but ultimately concluded that the plaintiffs did not have “unclean hands.” The Eleventh and Seventh Circuits have opined that the doctrine may apply in civil RICO actions. See Sikes v. Teleline, Inc., 281 P.3d 1350, 1366 n. 41 (11th Cir.2002); Laborers' International Union of North America v. Caruso, 197 F.3d 1195, 1197-98 (7th Cir.1999). The Third Circuit also has applied the doctrine of unclean hands in the context of determining whether an injunction, after trial, can be denied. Northeast Women's Center, Inc. v. McMonagle, 868 F.2d 1342, 1354-55 (3d Cir.1989).

Notwithstanding, the uncertainty at the circuit court level, it is persuasive that “an overwhelming majority” of district courts to consider the issue have concluded that “the defense of unclean hands is not available in civil RICO actions.” Florida Software Sys. v. Columbia/HCA Healthcare Corp., 1999 U.S. Dist. LEXIS 15294, at *6 (M.D.Fla. Sept. 16, 1999); see, e.g., Local 851 of the Int'l Bhd. of Teamsters, 1998 U.S. Dist. LEXIS 3779, at *5, 1998 WL 178873, at *2 (E.D.N.Y.1998); Bieter Co. v. Blomquist, 848 F.Supp. 1446 (D.Minn.1994); In re National Mortgage Equity Corp. Mortgage Pool Certificates Sec. Litig., 636 F.Supp. 1138 (C.D.Cal.1986).
Moreover, it is significant that courts have historically looked to antitrust law in interpreting RICO, see In re National Mortgage Equity Corp., 636 F.Supp. at 1155, and it is clear that the doctrine of unclean hands is not a defense to a civil antitrust suit. See Perma Life Mufflers, Inc. v. International Parts Corp., 392 U.S. 134, 139, 88 S.Ct. 1981, 20 L.Ed.2d 982 (1968). On this basis, a number of courts have declared that the defense of unclean hands does not apply in the civil RICO context. See Bieter Co. v. Blomquist, 848 F.Supp. At 1449.
Finally, the Supreme Court has held that the affirmative defense of unclean hands has “been rejected” in the context of statutes “where Congress [has] authorize[d] broad equitable relief to serve important national purposes.” McKennon v. Nashville Banner Publ. Co., 513 U.S. 352, 357, 115 S.Ct. 879, 130 L.Ed.2d 852 (1995) (addressing unclean hands in the context of an AEDA claim). RICO is such a statute. See, e.g., Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 28, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991) (RICO was “designed to advance important public policies”).
The persuasive weight of authority is that the affirmative defense of unclean hands is not available in a civil RICO action and cannot be asserted by the Defendants as an affirmative defense.

Split Over Whether "Actual Innocence" Exception is Available to those who were Erroneously Sentenced as Habitual Offenders Remains Unresolved

Per Harper v. Hubert, 2008 WL 4534097 (E.D. La. Oct 07, 2008):

In Haley v. Cockrell, 306 F.3d 257 (5th Cir.2002), the United States Fifth Circuit Court of Appeals, after noting that a split exists among the circuits on that issue, held that the "actual innocence" exception is available to petitioners in noncapital proceedings who claim they were erroneously sentenced as habitual or multiple offenders. Id. at 265-66. However, the Haley court held that, when barred claims dealt with such alleged sentencing errors, the "actual innocence" requirement is met only when the petitioner shows that "he would have not been legally eligible for the sentence he received." Id. at 264. The Supreme Court subsequently vacated the Haley decision on other grounds and remanded the case to the Fifth Circuit. Dretke v. Haley, 541 U.S. 386 (2004). In so doing, the Supreme Court declined to answer the question of whether the "actual innocence" exception applies to noncapital sentencing errors. Id. at 393-94.

This Court does not attempt to answer the question left open by the Supreme Court. . . .

D. Colo. Notes Split Re Whether Plaintiff's Assertion of Post-Conviction Access to Biological Evidence for DNA Testing Is Cognizable under § 1983

Per McDaniel v. John Suthers, 2008 WL 4527697 (D. Colo. Oct 02, 2008):

[T]he Court must determine whether Plaintiff's claim, asserting a post-conviction right of access to biological evidence for DNA testing, is cognizable under Section 1983 or whether it is properly limited to the realm of habeas corpus.

The circuit courts have split in their resolution of this question. The Second, Seventh, Ninth, and Eleventh Circuits have found that a prisoner may properly bring a claim under Section 1983 for post-conviction access to biological materials for DNA testing. See, e.g., McKithen, 481 F.3d at 99; Savory v. Lyons, 469 F .3d 667, 669 (7th Cir.2006); Osborne v. Dist. Attorney's Office for the Third Judicial Dist., 423 F.3d 1050, 1054 (9th Cir.2005); Bradley v. Pryor, 305 F.3d 1287, 1290-91 (11th Cir.2002); see also Wade v. Brady, 460 F.Supp.2d 226, 237 (D.Mass.2006); Derrickson v. Del. County Dist. Attorney's Office, No. 04-1569, 2006 WL 2135854, at *8 (E.D.Pa. July 26, 2006). The Fourth, Fifth, and Sixth Circuits, on the other hand, have rejected this use of a Section 1983 claim, holding that such claims are limited to habeas corpus petitions. See Harvey v. Horan, 278 F.3d 370, 375 (4th Cir.2002); Kutzner v. Montgomery County, 303 F.3d 339, 340-41 (5th Cir.2002) (per curiam); see also Boyle v. Mayer, 46 F. App'x 340, 340 (6th Cir.2002).

Although the Tenth Circuit has rejected other attempts to use Section 1983 claims for post-conviction injunctive relief, see Alexander v. Lucas, 259 Fed. App'x 145 (10th Cir.2007), it has not considered whether it is possible to bring such a claim to gain post-conviction access to biological materials for DNA testing.

N.D. Cal. Analyzes Circuit Split Re Whether Failure to Act Constitutes a Continuing Violation of Agency's Statutory Duty

Per Public Citizen, Inc. v. Mukasey, 2008 WL 4532540 (N.D. Cal. Oct 09, 2008):

Here, plaintiffs suggest that the continuing violations doctrine applies to government in action. Although the Ninth Circuit has extended the continuing violations doctrine to employment and civil rights contexts, it has not offered any explicit guidance regarding application of the continuing violations doctrine to the situation at bar. See, e.g., Douglas v. Cal. Dep't of Youth Auth., 271 F.3d 812 (9th Cir.2001); Gutkowsky v. County of Placer, 108 F.3d 256 (9th Cir.2007). Courts outside of the Ninth Circuit are split on whether to apply the continuing violations doctrine to instances of agency inaction. See, e.g., Wilderness Soc'y v. Norton, 434 F.3d 584, 589 (D.C.Cir.2006) (concludes in dicta that § 2401(a) does not time-bar actions to rectify agency inaction in violation of a statutory duty); S. Utah Wilderness Alliance v. Norton, 301 F.3d 1217, 1232 (10th Cir.2002) (notes in dicta that an agency's failure to act as statutorily mandated "should be considered an ongoing failure to act, resulting in an ever-green cause of action for failure to act") . . . ("The statute of limitations commences to run anew each and every day that the Service does not fulfill the affirmative duty required of it.").

Eleventh Circuit Adopts Last Served Defendant Rule for Removal

Per ABA's Litigation News, Oct. 9, 2008:

Weighing in on a long-standing circuit split over when the time for removal runs in a multidefendant suit, the Eleventh Circuit in Bailey v. Janssen Pharmaceutica, Inc. [PDF] has adopted the so-called last-served defendant rule, suggesting that the U.S. Supreme Court’s decision in Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc. supports that rule.

In Bailey, the plaintiff served the last of four defendants over 30 days after service on the other three defendants. The last-served defendant filed a notice of removal 30 days from the date it was served. Both the district court and the Eleventh Circuit held that the notice of removal was timely because it was filed 30 days after last defendant was served

SCOTUS Denies Cert. in Case Addressing Split Re Standard of Review for Bremen Dismissals

Yesterday the Supreme Court denied certiorari in Arrow Electronics Inc. v. E.ON AG (9th Cir., 268 Fed. Appx. 551), a case that sought to resolve a circuit split regarding appellate review of dismissals under M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972). Here is BNA's brief summary of the ruling of the Ninth Circuit and the questions presented to the Supreme Court:

Summary of Ruling Below: Court affirms district court decision that dismissed certain claims for improper forum, in accordance with M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972), under which forum selection clause is to be enforced absent showing that it is unreasonable, unjust, fraudulent, or contrary to strong public policy.

Question(s) Presented: (1) Should Bremen doctrine, under which international forum selection clause is controlling if certain exceptions do not apply, be in line with contemporary domestic and international forum selection law? (2) Should Bremen dismissal be reviewed de novo, as nine circuits do, or using abuse of discretion standard, as do two (including Ninth)?

D. Mass. Reviews Split Re Whether PLRA Limits Attorneys' Fees to Rate Paid or Rate Set by the Judicial Conference

Per Hudson v. Dennehy, 568 F. Supp. 2d 125 (D. Mass. Jul 25, 2008):

Defendant's second objection relates to the cap on fees imposed by the PLRA. The PLRA limits the hourly rate to no "greater than 150 percent of the hourly rate established under [the CJA] for payment of court-appointed counsel." 42 U.S.C. § 1997e(d)(3).

. . . .

But the statute is not written in terms of what was actually paid. Rather, the PLRA caps fees at 150 percent of the hourly rate established for payment of court-appointed counsel. Hourly rates for CJA cases are set by the Judicial Conference.

. . . .

Accordingly, the amounts actually paid to court-appointed counsel are not the rates "established" by the Judicial Conference; rather, they reflect a lack of adequate funding by Congress.

. . . .

The issue is one of statutory construction that the First Circuit has yet to address.

. . . .

The few Circuits to have squarely addressed the issue are divided. Joining the Sixth Circuit is the Ninth Circuit, see Webb v. Ada County, 285 F.3d 829, 838-839 (9th Cir.2002). The Third Circuit stands alone in adopting the defendant's approach. See Hernandez v. Kalinowski, 146 F.3d 196, 201 (3d Cir.1998) (PLRA limits attorneys' fees to the hourly rate actually paid, not the rate set by the Judicial Conference)