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Legal news from Monday, December 13, 2010




EU to sanction Ivory Coast over non-compliance with election results
Sarah Paulsworth on December 13, 2010 2:29 PM ET

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[JURIST] The Council of the EU [official website] adopted a decision Monday to institute sanctions [official statement, PDF] against the Ivory Coast. There has been unrest in the country [JURIST report] since elections were held at the beginning of this month. Alassane Ouattara defeated incumbent Laurent Gbagbo, but Gbagbo has refused to concede victory [AP report] to Ouattrara. According to the EU's statement:
The Council has considered how to react to the situation in Cote d'Ivoire. It has decided to adopt without delay targeted restrictive measures against those who are obstructing the process of peace and national reconciliation, and in particular who are jeopardising the proper outcome of the electoral process. Those measures will include a visa ban and an assets freeze. They will particularly target those leading figures who have refused to place themselves under the authority of the democratically elected President, of whom an initial list should be adopted rapidly.
The UN certified [UN News Centre report] Ouattrara's victory, but both he and Gbagbo have taken oaths of office. Approximately $340 million in aid from the EU could also be withheld [AP report] if Gbagbo does not concede victory to Ouattrara.

In February, Gbagbo dissolved [JURIST report] the country's parliament and electoral commission based on allegations of voter fraud in the long delayed presidential elections. On disbanding the government, Gbagbo charged Prime Minister Guillaume Soro [BBC profile] with creation of new government and new election format. Gbagbo had accused Beugre Mambe, the head of the independent electoral commission, of fraud by attempting to register more than 400,000 whom Gbagbo considers to be foreigners. Opposition parties such as the Ivory Coast Democratic Party (PDCI) [party website, in French] and Republican Gathering Party (RDR) [party website, in French] said that most of those voters are ethnic groups in the north of the country, who would likely have voted against Gbagbo. Gbagbo was elected president in 2000 to serve a five-year term, but he has managed to stay in office through delaying six successive elections.




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Federal judge rules health insurance mandate unconstitutional
Sarah Paulsworth on December 13, 2010 1:35 PM ET

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[JURIST] A judge for the US District Court for the Eastern District of Virginia [official website] ruled [opinion, PDF] Monday that the minimum coverage provision of the recently enacted health care reform law [HR 3590 text; JURIST news archive] is unconstitutional. Judge Henry Hudson, who had previously denied a motion to dismiss the lawsuit [JURIST report], found that an individual's decision to purchase health insurance is beyond the reach of Congress and outside the purview of the Commerce, Necessary and Proper, General Welfare and Taxation powers enumerated in the US Constitution [text]:
A thorough survey of pertinent constitutional case law has yielded no reported decisions from any federal appellate courts extending the Commerce Clause or General Welfare Clause to encompass regulation of a person's decision not to purchase a product, notwithstanding its effect on interstate commerce or role in a global regulatory scheme. The unchecked expansion of congressional power to the limits suggested by the Minimum Essential Coverage Provision would invite unbridled exercise of federal police powers. At its core, this dispute is not simply about regulating the business of insurance—or crafting a scheme of universal health insurance coverage—it's about an individual's right to choose to participate.
Hudson left the rest of the law intact, determining that the minimum coverage provision is severable. Hudson also refused to issue injunctive relief, stating that "the award of declaratory judgment is sufficient to stay the hand of the executive branch pending an appeal." It is anticipated that this challenge will go all the way to the Supreme Court.

Monday's ruling marks the first time a court has struck down part of the health care despite numerous legal challenges. Last week, a judge for the US District Court for the District of New Jersey [official website] granted a motion to dismiss [JURIST report] a lawsuit [case materials] brought by a physician organization challenging the law. Earlier in December, a judge for the US District Court for the Western District of Virginia [official website] dismissed [JURIST report] a health care challenge filed by Liberty University [academic website]. In October, a judge for the US District Court for the Northern District of Florida [official website] denied a motion to dismiss [JURIST report] a lawsuit brought by a group of attorneys general challenging the constitutionality of the health care law. The lawsuit [complaint, PDF], filed in March and joined by 20 states [JURIST reports] and the National Federation of Independent Businesses (NFIB) [association website; JURIST report], seeks injunctive and declaratory relief against what it alleges are violations of Article I and the Tenth Amendment of the Constitution, committed by levying a tax without regard to census data, property or profession, and for invading the sovereignty of the states. A week earlier, a federal judge in Michigan ruled [JURIST report] that the law is constitutional under the Commerce Clause as it addresses the economic effects of health care decisions, and that it does not represent an unconstitutional direct tax.




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Madoff trustee files nearly 60 lawsuits to recover money for victims
Megan McKee on December 13, 2010 11:14 AM ET

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[JURIST] Irving Picard, the trustee charged with recovering money for the victims of the Bernard Madoff [JURIST news archive] scandal, has filed close to 60 lawsuits in the past three weeks attempting to recover more than $40 billion from numerous banks, hedge funds and individuals. The influx of litigation [FT report] coincided with the Saturday deadline for seeking compensation. Picard has spent two years investigating, and the various resulting lawsuits have culminated in more than 1,100 subpoenas. The suits implicate institutions such as HSBC, JPMorgan, UBS and Citigroup [corporate websites], either for enabling the Ponzi scheme or their failure to recognize it. UniCredit [corporate website] and Sonja Kohn face the largest lawsuits, and are accused of participating in the scheme. Although Picard's deadline has passed, the US attorney in Manhattan Preet Bharara still has three more years to file criminal charges or a civil forfeiture claim. The institutions and individuals sued by Picard continue to deny the allegations.

Last November, former outside accountant for Madoff, David Friehling [case materials], pleaded guilty [plea agreement, PDF; JURIST report] to fraud charges in the US District Court for the Southern District of New York [official website]. Despite his guilty plea, Friehling did not admit knowledge of Madoff's Ponzi scheme. Friehling, who was charged [complaint, PDF; JURIST report] in March, pleaded guilty on nine counts, including securities fraud, investment adviser fraud, making false filings with the Securities and Exchange Commission (SEC) [official website] and obstructing or impeding the enforcement of internal revenue laws. Friehling also agreed to forfeit $3,183,000 in addition to other property obtained through his services to Madoff and promised to cooperate in the government's investigation surrounding the Madoff scandal. Also last year, Madoff's former financial chief Frank DiPascali pleaded guilty [JURIST report] for his role in Madoff's scheme. In June 2009, Madoff was sentenced to 150 years in prison [JURIST report]. Madoff pleaded guilty to 11 charges of fraud in March 2009 after agreeing to a partial judgment from the SEC [JURIST reports] for civil charges stemming from his role in defrauding investors.




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Supreme Court splits on copyright protections for imported goods
Jaclyn Belczyk on December 13, 2010 10:52 AM ET

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[JURIST] The US Supreme Court [official website; JURIST news archive] on Monday divided 4-4 [opinion, PDF] in Costco Wholesale Corp v. Omega, SA [Cornell LII backgrounder; JURIST report] on the issue of copyright protections for imported goods. The case presented the question of whether the first-sale doctrine [17 USC § 109(a)], which provides that the owner of any particular copy "lawfully made under this title" may resell that good without the authority of the copyright holder, applies to imported goods manufactured abroad. Swiss watchmaker Omega [corporate website] manufactures watches in Switzerland and then sells them to authorized distributors overseas. Watches were purchased by third parties and eventually sold to Costco [corporate website], which sold them to US consumers without authorization from Omega. The US Court of Appeals for the Ninth Circuit ruled [opinion, PDF; JURIST report] that the first-sale doctrine does not apply to imported goods. The 4-4 split, with Justice Elena Kagan recused, means that the Ninth Circuit's decision is affirmed, but that the ruling does not set precedent.

Also Monday, the court ruled [order list, PDF] that federal courts lack jurisdiction to hear a challenge to the size of the US House of Representatives [official website]. The court vacated a ruling by the US District Court for the Northern District of Mississippi [official website] and remanded with orders to dismiss the lawsuit for lack of jurisdiction.




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Malaysia opposition leader files complaint over WikiLeaks sodomy cable
Megan McKee on December 13, 2010 10:05 AM ET

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[JURIST] Malaysian opposition leader Anwar Ibrahim [BBC profile; JURIST news archive] on Monday filed a complaint in a Malaysian court over a WikiLeaks [website] cable published by Australian newspapers stating he had engaged in sodomy. The leaked US diplomatic cable claimed Australia's Office of National Assessments [official website] had concluded, in agreement with Singapore's Intelligence Agency, that the sodomy charges against Ibrahim were the result of a set-up, but that he was in fact guilty of committing the acts [Malaysian Star report] for which he has been indicted. Anwar is charged with sodomizing his former aide Mohamad Saiful Bukhari Azlan in 2008, and the trial is currently ongoing. His lawyers have called for the Malaysian media sources that have published the claims to be charged with contempt and say the reports are based on hearsay and cannot be trusted. Anwar has continued to describe the charges as a farce aimed at preventing him from taking his seat in parliament following the gains made by his party in the 2008 elections.

Last month, the Federal Court of Malaysia [official website], the country's highest court, rejected a defamation suit [JURIST report] filed by Anwar against former prime minister Mahathir Mohamad [BBC profile]. Anwar filed suit in 2006 after Mahathir allegedly suggested at a human rights conference that Anwar was unfit for office because of his supposed homosexuality. In September, the Malaysian Court of Appeals [official website] dismissed Anwar's appeal of the Kuala Lumpur High Court's refusal to throw out the sodomy charges [JURIST reports] against him based on allegations that his accuser had an affair with the prosecutor. A three-man panel ruled that, under Section 3 of the Court of Judicature Act (CJA) [materials, text], the appeals court had no jurisdiction to hear the appeal because the High Court's ruling was not a final decision. Counsel for Anwar was to appeal to Malaysia's highest court, which will further delay his trial [JURIST report]. This was his second attempt to have the sodomy charge against him dismissed [JURIST report].




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Federal judge dismisses Microsoft co-founder's patent suit
Jaclyn Belczyk on December 13, 2010 9:15 AM ET

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[JURIST] A judge for the US District Court for the Western District of Washington [official website] on Friday dismissed [order, PDF] a patent infringement lawsuit [JURIST report] by Microsoft co-founder Paul Allen against Apple, eBay, Google [corporate websites] and eight other corporations. According to the complaint [text, PDF], which also named AOL, Facebook, Netflix, Office Depot, OfficeMax, Staples, Yahoo and YouTube [corporate websites], the companies misappropriated technologies patented by Allen's now defunct Interval Research Corporation and currently held by Interval Licensing, LLC. The suit charged that the 11 defendants infringed on a patent that recommends like content to users based on real-time viewing data, while all but Facebook violated another that amalgamates and analyzes audio, video and text data [USPTO materials] to perform a similar function. It further alleged that AOL, Apple, Google and Yahoo violated two additional patents, 6,034,652 and 6,788,314 [USPTO materials], that identify advertisements, news and videos to display "in a way that occupies [a user's] peripheral attention." Judge Marsha Pechman dismissed Allen's claims, finding that "Plaintiff has failed to identify the infringing products or devices with any specificity." A spokesperson said Allen plans to file an amended complaint [Reuters report]

Allen's suit comes as several of the named defendants face unrelated litigation alleging misappropriation of intellectual property. Connecticut company XPRT Ventures LLC sued [JURIST report] eBay in July claiming the infringement of six patents for online auctions and payment systems. In April, a federal appeals court found that eBay is not required to actively monitor its website [JURIST report] for the sale of counterfeit goods. The ruling came shortly after a French court ordered [JURIST report] the company to pay LVMH Moet Hennessy Louis Vuitton (LVMH) [official website] damages for paying search engines to direct consumers to counterfeit LVMH products. LVMH previously secured a $63 million judgment [JURIST report] in 2008 for failing to prevent the sale of counterfeit luxury goods that infringed on registered designs. Patent holding company NTP filed suit [JURIST report] in July against Apple and Google, among other smart phone makers, related to the use of e-mail systems utilizing technology patented by NTP. The US International Trade Commission (ITC) [official website] launched an investigation [JURIST report] in June into allegations by HTC Corp [corporate website] accusing Apple of patent infringement on certain portable electronic devices. In October 2009, Finnish telecommunications company Nokia [corporate website] filed suit [JURIST report] against Apple alleging that the company infringed 10 of its patents since the first iPhone was released in 2007. The patents cover wireless data transmission, speech coding and security/encryption.




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