Justia U.S. 11th Circuit Court of Appeals Opinion Summaries

Imperial Premium Finance LLC was implicated in a life insurance scheme. Imperial’s primary business involved stranger-originated life insurance (STOLI), yet its business was not a STOLI in its purest form: instead of buying a policy on a person's life outright, Imperial provided financing for life insurance premiums in the form of loans whose terms allowed Imperial to foreclose on the policy and become the policy owner if the borrower defaulted. Seeking to evade "insurable interest" requirements, Imperial drafted its loan agreements to require that during the term of the loan the policy be held in irrevocable trust (with a trustee chosen by Imperial) for the benefit of the insured’s relatives. In late 2007, Florida resident Barton Cotton met with an insurance agent to buy a multimillion-dollar life insurance policy and finance the premium payments. Cotton was ultimately referred to Imperial about financing the premium payments. Cotton and an irrevocable trust in his name applied to Lincoln National Life Insurance Company for an $8 million life insurance policy. The beneficiaries of the trust were Cotton’s wife and children. Cotton falsely stated on the insurance application that he was not buying the policy for resale and that he would not use a third party to finance the premium payments. Lincoln issued Cotton a $5 million policy, which became an asset of the Cotton trust. Premium payments were advanced to the trust until Imperial lent the trust $335,000. The trust used that money to repay the advance and to continue making the premium payments. Because of the high interest rate and an “origination fee," after less than two years, Imperial’s $335,000 loan to the Cotton trust had ballooned to more than $557,000. Cotton was diagnosed with esophageal cancer. The loan used to finance the policy reached maturity and became due, and Cotton died two months after that. At the time of his death the trust had not paid back Imperial for the loan, but Imperial had not yet foreclosed on it, which left the trust for the benefit of Cotton’s family as the record owner of the policy. After learning of Cotton’s death, Lincoln launched an investigation which turned up the fact that Imperial had financed the purchase of the policy on Cotton’s life under a STOLI scheme. Lincoln refused to pay the death benefit. In April 2011 the Cotton trustee sued Lincoln for the benefit. Lincoln counterclaimed, alleging fraud, negligent misrepresentation, and civil conspiracy. Imperial asked its outside counsel to represent the trust. During discovery, Lincoln sought to depose Imperial under Rule 30(b)(6) of the Federal Rules of Civil Procedure. Because the topics included in Lincoln’s subpoena touched on subjects related to the criminal investigation, Imperial’s managers and employees exercised their individual Fifth Amendment rights and all refused to testify in the Rule 30(b)(6) deposition in the Lincoln case. Imperial's proffered expert witness was unable to answer questions at the deposition or at trial specific to the facts of the Cotton trust case. The jury later returned a verdict in favor of the trust, finding that though Cotton and others conspired to commit an unlawful act, Lincoln had not relied on or been damaged by the misrepresentations, and therefore not injured by the conspiracy. The court notified the parties that it was considering sanctions against Imperial and its proffered expert due to the witness' poor "performance" and lack of preparation at trial. After a hearing, the court assessed sanctions against Imperial. Imperial appealed that sanctions order. Finding that the district court's findings were not clearly erroneous and its imposition of sanctions was not an abuse of discretion, the Eleventh Circuit affirmed the sanctions order. View "Lincoln National Life Insurance Company v. Imperial Premium Finance Company, LLC" on Justia Law

The Military and Overseas Voter Empowerment Act (UOCAVA), Pub. L. No. 111-84, Subtitle H, 575-589, 123 Stat. 2190, 2322, amended the Uniformed and Overseas Citizen Absentee Voting Act of 1986, 42 U.S.C. 1973ff. The UOCAVA now requires a state, absent a hardship waiver, to transmit an absentee ballot to the voter "not later than 45 days before the election[.]" Georgia and Alabama appealed the district court's grant of preliminary injunctive relief, summary judgment, and permanent injunctive relief in a suit brought by the United States against Georgia and Alabama. The district court ruled that the 45-day transmittal requirement applies to runoff elections for federal office, and that the runoff election schemes in these two states violated UOCAVA. After the district court had issued its ruling and after the briefs in this appeal were filed, the Georgia Legislature passed H.B. 310, which in relevant part amends Georgia's election calendar and voting procedures to comply with the 45-day transmittal requirement. In light of H.B. 310, the court dismissed Georgia's appeal as moot. View "United States v. State of Georgia" on Justia Law

Defendant appealed his convictions of sexual exploitation of a child and possession of child pornography. The court affirmed the convictions, concluding that the evidence was sufficient to convict defendant, and that his indictment was not defective for failure to identify the specific image charged and defendant did not suffer actual prejudice. View "United States v. Bailey" on Justia Law

In these consolidated appeals, the Redmond Group and Zeltser Group dispute over ownership of, and control over, three involuntary debtors: Fisher Island, Little Rest, and Mutual Benefits (collectively, the "Alleged Debtors"). Litigation of the ownership issue in three bankruptcy cases produced five consolidated appeals of four district court orders. After careful review of the record and the parties' briefs, the court found no reversible error and affirmed all four orders: the district court's denial of Zeltser Group's motion to withdraw reference of the ownership issue; the district court's affirmance of the bankruptcy court's summary judgment order in favor of the Redmond Group in the Fisher Island and Little Rest cases; the district court's order dismissing, for lack of standing, certain non-party appeals from the bankruptcy court's summary judgment order; and the district court's affirmance of the bankruptcy court's final judgment in favor of the Redmond Group in the Mutual Benefits case. View "Fisher Island Ltd. v. Solby+Westbrae Partners" on Justia Law

Defendant moved to Daytona Beach, Florida after registering as a sex offender in the Northern District of Georgia. Defendant failed to update his registration in Daytona Beach and was indicted for failure to register. Defendant conditionally plead guilty, the district court denied defendant's motion to dismiss his indictment, and sentenced him to 16 months imprisonment for violating the terms of his supervised release. The court joined its sister circuits and held that 18 U.S.C. 3237 applies and venue lies in Georgia. The court concluded that, because the crime consists both of traveling and failing to register, defendant began his crime in Georgia and consummated it in Florida. The court also concluded that defendant's sentence for violating his supervised release is substantively reasonable. Accordingly, the court affirmed defendant's conviction for failure to register as a sex offender and his sentence for failing to comply with the terms of his supervised release. View "United States v. Kopp" on Justia Law

Eight defendants, seven individuals and one corporation, appealed their convictions and sentences stemming from their involvement in a complex and sustained scheme of Medicare fraud. The seven individual defendants are the owners of Biscayne Milieu, a certified Community Mental Health Center. Defendants' offenses were related to Biscayne Milieu's submission of fraudulent Medicare claims. The court affirmed the convictions and sentences after considering the numerous issues on appeal regarding each of the eight defendants: the sufficiency of the evidence; multiplicitous counts in the indictment; juror removal and attorney misconduct; admission of lay testimony; reference to invocation of right to counsel; prosecutor comments at closing argument; defining "attempt;" cumulative errors; sentencing; and restitution. View "United States v. Moran" on Justia Law

The Uniformed and Overseas Citizens Absentee Voting Act (UOCAVA), 52 U.S.C. 20302(a)(8)(A), includes a variety of measures that states are required to adopt in order to accommodate military voters when they administer federal elections. At issue is section 20302(a)(8)(A)'s requirement that, when a qualifying military or overseas voter requests an absentee ballot for a federal election, a state must transmit a ballot to that voter forty-five days before the federal election. The United States filed suit against Alabama seeking to enjoin the State from holding federal runoff elections forty-two days after federal primary elections. When the court looked at the text of section 20302(a)(9), the court found that it directs states only to "establish a written plan" in preparation for runoff elections, and makes no claim that it abrogates the mandatory forty-five day transmission timeline. In light of the plain language of this substantive command - and Congress's clear intent to prioritize the empowerment of military voters through clear and accessible absentee voting procedures - the court concluded that section 20302(a)(9) does not alter the court's interpretation. Therefore, the court held that the State must transmit validly requested absentee ballots to eligible UOCAVA voters forty-five days before each federal election, whether that election is primary, general, special, or runoff. Accordingly, the court affirmed the district court's grant of summary judgment to the United States. View "United States v. Alabama" on Justia Law

This appeal stemmed from five putative class actions filed against Wells Fargo and its predecessor, Wachovia Bank. At issue was whether Wells Fargo's waiver of its right to compel arbitration of the named plaintiffs' claims should be extended to preclude Wells Fargo from compelling arbitration of the unnamed putative class members' claims. The court concluded that because a class including the unnamed putative class members had not been certified, Article III's jurisdictional limitations precluded the district court from entertaining Wells Fargo's conditional motions to dismiss those members' claims as subject to arbitration; contrary to the position they take in this appeal, the named plaintiffs lack Article III standing to seek the court's affirmance of the district court's provision holding that if a class is certified, Wells Fargo will be estopped to assert its contractual rights to arbitration; and, therefore, the court vacated and remanded for further proceedings. View "Spears-Haymond v. Wells Fargo Bank" on Justia Law

Plaintiff, appointed the receiver of six hedge funds that were part of a Ponzi scheme orchestrated by Arthur Nadel, attempted to recover alleged "false profits" in connection with Nadel's fraudulent scheme. Herbert Schneiderman, now deceased, was among the investors who became subject to one of plaintiff's "clawback" suits. Schneiderman's estate moved to compel arbitration and the district court granted the motion. The arbitrator then granted summary judgment to the estate and denied plaintiff's motion for reconsideration. Plaintiff's motion to vacate the arbitrator's decision was denied. The court concluded that clawback actions are not categorically exempt from the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq.; the district court did not err in determining that the parties formed a contract and that questions as to its validity were for the arbitrator to decide; the district court did not err in sending all claims to arbitration; and the arbitrator did not so exceed or imperfectly use his powers that the district court erred in declining to vacate the award. Accordingly, the court affirmed the judgment. View "Wiand v. Schneiderman" on Justia Law

The Bank filed a claim with Travelers for the loss incurred with a long-time customer's default. The customer had pledged various assets as collateral for a loan including stock certificates representing shares in The Securance Group. The court held that, under Alabama law, a financial institution bond's definition of "counterfeit" - "an imitation which is intended to deceive and to be taken as an original" - does not encompass a duly authorized stock certificate procured under false pretenses. In this case, Certificate No. 11 at issue was fraudulently procured and, as such, valueless, it was an authentic document and thus not "counterfeit" under the terms of the bond. Accordingly, the court affirmed the district court's grant of summary judgment to Travelers. View "Bank of Brewton v. The Travelers Companies" on Justia Law