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Legal news from Thursday, April 19, 2012 |
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Federal judge dismisses Goldman Sachs, other banks from GE securities lawsuit
Brandon Gatto on April 19, 2012 2:10 PM ET

[JURIST] Federal Judge Denise Cote on Wednesday dismissed a securities lawsuit [opinion, PDF] against Goldman Sachs Group Inc. [corporate website] and 41 other defendants claiming [complaint, PDF] that the banks helped mislead investors in the $12.2 billion stock offering by General Electric Co. (GE) [corporate website] back in October 2008. The claims, filed by investors in the US District Court for the Southern District of New York [official website], were brought under the 1933 Securities Act [text, PDF] and concerned GE statements made in September 2008 indicating that GE possessed a strong, healthy financial position. Cote, however, noted that the statements in question were made in a press release, and were not incorporated in GE's prospectus supplement for the secondary offering. This fact, explained Cote, was the key distinction from her January denial of defendants' summary judgment motion, where she had improperly relied on the statements because they were presented as part of the offering documents for the shares.
Last month, the Securities Exchange Commission (SEC) [official website] began a fraud investigation [JURIST report] into Wells Fargo & Company [corporate website] by filing a subpoena enforcement action to force the company to turn over documents connected to its sale of $60 in residential mortgage-backed securities to investors. The fraud is allegedly due to material misrepresentations or omitted material facts in a number of Wells Fargo offerings between 2006 and 2008. The SEC is also investigating several other firms [Bloomberg report] that failed to disclose material facts related to weaknesses in offerings, and has informed Goldman Sachs and JPMorgan Chase [corporate website] that they may also face charges. Earlier in March, the country's five largest mortgage service providers reached a $25 billion dollar agreement [JURIST report] with the US Department of Justice (DOJ), the Department of Housing and Urban Development (HUD) [official websites], and 49 state attorneys general over mortgage loan servicing and foreclosure abuses. Announced in February [JURIST report], the settlement does not prevent civil suits by individual homeowners or criminal charges pursued by federal or state authorities.


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Kazakhstan court sentences 47 individuals on terrorism charges
Jamie Reese on April 19, 2012 11:44 AM ET

[JURIST] A court in Kazakhstan [official website] sentenced 47 individuals to 15-year prison terms Thursday on charges relating to terrorist attacks and financing extremist activities. The convicted individuals are alleged to be members of a terrorist group [AP report] and were subjected to a month-long trial, beginning in March and ending Wednesday. The violence presented a threat to the administration of President Nursultan Nazarbayev [official website, in Kazakh; BBC profile] who has been in power in Kazakhstan for more than two decades following Soviet Communist rule. The trial and information pertaining to it were not entirely accessible by the public, and the lack of transparency has raised concerns of possible human rights violations. Relatives of the accused are worried that the country's main constitutional values: freedom of expression, freedom of the press and respect for human life, are meaningless and are fearful to express their opinions and concerns [Reuters report].
Human rights groups have closely scrutinized Kazakhstan's adherence to its international human rights obligations. In October Nazarbayev signed a restrictive law to curb religious extremism after the Kazakhstani parliament passed the bill [JURIST reports] a month earlier. Last April Nazarbayev discharged six justices [JURIST report] of the Supreme Court of the Republic of Kazkhstan for corruption. Kazakhstan submitted to a Universal Periodic Review (UPR) by the UN Human Rights Council [official websites] in February 2010. Kazakhstan accepted 121 of the recommendations [Kazakhstan UPR materials] to reduce human rights violation, particularly with respect to freedom of the press. In August 2009, the Supreme Court affirmed the conviction [JURIST report] of publisher Ramazan Esergepov, who was sentenced to three years in jail for revealing state secrets in his newspaper. A representative of Freedom of the Media at the Organization for Security and Co-operation in Europe (OSCE) [official websites] said that revealing public corruption [press release] is the "main duty of the journalists acting in the public interest," and that "[c]riminal sanctions for 'breach of secrecy' should only apply to the officials whose job descriptions stipulate the duty to protect sensitive information, but not to citizens."


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UN SG concerned over arrests of Mali officials
Katherine Getty on April 19, 2012 11:37 AM ET

[JURIST] UN Secretary General Ban Ki-Moon [official profile] expressed concern [statement] on Wednesday over the new wave of arrests targeted at high-ranking officials within Mali. BAn demanded immediate release of those who had been imprisoned and asked that the junta stop all further arrests. He stated that these actions directly conflicted with the steps Mali has taken to re-establish constitutional order within its borders. Ban's comments come just days after UN High Commissioner for Human Rights Navi Pillay [official profile] called for national and international action [JURIST report] to bring an end to the political instability and continuing human rights violations. Ban and Pillay join a host of other international leaders [Reuters report] who have denounced the arrests including those from the African Union and the Economic Community of West African States (ECOWAS) [official websites]. The African Union released its own statement Wednesday condemning the arbitrary arrests [press release, PDF] and the negative impact they are having on the resurrection of constitutional order.
Mali has experienced military turmoil since Taureg rebels began attacking Malian soldiers [Al Jazeera report] in January. Last month Captain Amadou Haya Sanogo, who led Malian soldiers in a military coup [JURIST report], announced he would reinstate the country's 1992 Constitution [text, PDF, in French] and create a transitional government to hold elections. Also in March the UN High Commissioner for Refugees [official website] expressed concern over political and security instability in Mali [JURIST report], and how ongoing fighting between government forces and Tuareg rebels will affect Malians forced to flee their homes in search of safety. Last month the acting head of the EU delegation in Mali, Bertrand Soret, met with Sanogo and urged a quick return to constitutional order [JURIST report]. Soret indicated that the EU expected the Malian military to find a solution to the current crisis, and that he has asked to have access to government ministers that have been detained by the military. The UNHCR reported last month that more than 80,000 people had fled Mali [press release] to escape the fighting.


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Former Venezuela top judge accuses government of manipulating judicial decisions
Jennie Ryan on April 19, 2012 10:58 AM ET

[JURIST] A former Venezuelan Supreme Tribunal of Justice [official website, in Spanish] judge accused the Venezuelan government on Thursday of improperly interfering with judicial decisions in a televised interview [video, in Spanish]. In the interview conducted in the US, former Venezuelan Justice Eladio Aponte Aponte said that judges in Venezuela make their decisions based on government instructions. Aponte said "I think it's very corrupt at every single level. There's a lot of manipulation. ... There's no ruling that isn't consulted. Lately, all the criminal courts have to make consultations before handing down a ruling." Aponte is in the US at the behest of the Drug Enforcement Administration (DEA) [official website] after the Venezuelan government accused him of having connections to a drug trafficker [CNN report] in March and relieved him of his position on the country's highest court. In the interview, Aponte also alleged that Venezuela has kept prisoners of war, an allegation that has previously been denied by President Hugo Chavez [BBC profile; JURIST news archive].
The Venezuelan government has been criticized in the past, largely for restricting human rights. In December 2010, the National Assembly of Venezuela [official website, in Spanish] passed [JURIST report] the Social Responsibility Law [text, PDF, in Spanish], which bans Internet content that promotes unrest among citizens or challenges legally established authorities. In June 2010, the Inter-American Court of Human Rights (IACHR) [official website] sent a letter to the Venezuelan government expressing concern [JURIST report] over the increasing threat to freedom of expression [press release] in the country, citing three recent cases that caused particular concern. In February 2010, the IACHR released a report [JURIST report] providing a detailed analysis on the state of human rights in Venezuela, which ultimately concluded that not all citizens are ensured full enjoyment of their basic human rights. The top Venezuelan human rights official criticized the report [JURIST report] and said that the report makes unfair characterizations and undermines Venezuelan democracy.


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Rights groups condemn violence against Azerbaijan journalist
Saheli Chakrabarty on April 19, 2012 9:29 AM ET

[JURIST] Amnesty International (AI), Human Rights Watch (HRW) and the Organization for Security and Cooperation in Europe (OSCE) [advocacy websites] urged Azerbaijani authorities on Tuesday to conduct an investigation into the violent attack by police and security personnel against journalist Idrak Abbasov. Abbasov was beaten by the state energy company while filming the unlawful demolition of a house near the capital of Baku. Abbasov was wearing a yellow reflective vest identifying him as a journalist. The human rights groups condemned [OSCE press release] the violence, claiming that the attack demonstrates the Azerbaijani government's disregard for freedom of media. HRW Europe and Central Asia director Hugh Williamson criticized the government's response [press release] to the attack:The fact that security personnel attacked Abbasov in broad daylight is utterly outrageous and shows the climate of impunity for attacks on journalists in Azerbaijan. The European Broadcasting Union should not stand by and watch silently as this violent campaign against the media unfolds. John Dalhuisen, the AI Director for Europe and Central Asia, similarly condemned the Azerbaijani government [press release], saying it "must respect media freedom-and the song contest's co-organizers, the European Broadcasting Union, must come swiftly to the defense of journalists."
The Committee to Protect Journalists (CPJ) [advocacy website] released its annual Attacks on the Press report [JURIST report] in February, expressing concern about increased censorship of journalists worldwide in 2011. Last May, journalism rights group Reporters without Borders (RSF) [advocacy website] released [JURIST report] its annual list of predators of press freedom [materials; press release], which included the President of Azerbaijan, Ilham Aliev. In April 2011, the US Department of State (DOS) [official website] released its 2010 Country Reports on Human Rights Practices [materials]. The reports cited many of the same countries and organizations [JURIST report] as the RSF for violating freedom of the press, including Azerbaijan. RSF's 2010 report [JURIST report] also listed many of the same offenders.


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Supreme Court hears arguments on federal payment for American Indian tribes
Julia Zebley on April 19, 2012 9:18 AM ET

[JURIST] The US Supreme Court [official website] heard oral arguments [day call, PDF] Wednesday in Salazar v. Ramah Navajo Chapter [transcript; JURIST report] on whether the federal government must pay American Indian tribes all contract-related costs incurred under the Indian Self-Determination and Education Assistance Act [text], even when those costs exceed the funds that the government promised would be available to the fund. The Act grants several federal departments, including the Departments of Interior, Health, Education and Welfare, to contract directly with American Indian tribes and allow them funding to autonomously replicate that department's function on their reservation. The Act requires absolute acceptance of every contract proposed by American Indian tribes. However, there is a cap of funding for all the tribes' use and once that is exceeded—even in the scenario where one tribe takes the majority of the funding—the US government is arguing that it should not be forced to reimburse additional costs taken on by those tribal programs and that they can choose to disperse the funds as they choose. Thus far, this has included paying some contractors in total and others not at all, as the Departments involved see fit. The respondents, several American Indian tribes, argued that this is arbitrary and contrary to the Ferris doctrine: "But the reality is that from the Tribe's perspective, they recognize, because of Ferris, and because of the way the Comptroller General has interpreted Ferris, that they are under a duty to make sure that there is an appropriation that covers this contract, that the amount, purpose, time requirements are all satisfied with enough money to accomplish that. And then, of course, we have the obligation to perform, which, of course, that's the other half of the equation here."
The Ferris doctrine originates in Ferris v. United States, an 1892 Court of Claims opinion that sets forth "A contractor who is one of several persons to be paid out of an appropriation is not chargeable with knowledge of its administration, nor can his legal rights be affected or impaired by its maladministration or by its diversion, whether legal or illegal, to other objects." The ancient doctrine was reaffirmed by the Supreme Court in 2005 through Cherokee Nation v. Leavitt [JURIST report], which held the original presumption that under the Indian Self-Determination and Education Assistance Act, tribes may undertake and be reimbursed for programs that would otherwise be provided by the government.


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Supreme Court rules patent applicants can introduce new evidence
Maureen Cosgrove on April 19, 2012 8:18 AM ET

[JURIST] The US Supreme Court [official website] ruled unanimously [opinion, PDF] Wednesday in Kappos v. Hyatt [SCOTUSblog backgrounder] that a patent applicant pursuing a 35 USC § 145 [text] claim may introduce new evidence that could have been presented to the US Patent and Trademark Office (PTO) [official website] in the first instance. When the PTO denies an application for a patent, the applicant may seek judicial review of the agency's final action through either of two avenues. The applicant may obtain direct review of the agency's determination in the US Court of Appeals for the Federal Circuit under 35 USC § 141 [text]. Alternatively, the applicant may commence a civil action against the Director of the PTO in federal district court under 35 USC § 145. The ruling affirms a Federal Circuit decision [opinion, PDF], which held that "§ 145 imposes no limitation on an applicant's right to introduce new evidence before the district court." Admissibility of new evidence is limited only by the Federal Rules of Evidence and the Federal Rules of Civil Procedure. The court also held that, when new evidence is introduced under § 145, the district court may decide de novo the factual questions to which the evidence pertains, without giving deference to the prior decision of the PTO.
Justice Sonia Sotomayor wrote a concurring opinion, with which Justice Stephen Breyer joined, expressing her concern that the court's decision "foreclose[d] a district court's authority ... to exclude evidence "deliberately suppressed"from the PTO or otherwise withheld in bad faith." The decision, she notes, prohibits courts from exercising authority to "exclude evidence from a § 145 proceeding when its admission would be inconsistent with regular equity practice and procedure."


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Supreme Court rules political organizations immune from torture act liability
Maureen Cosgrove on April 19, 2012 7:19 AM ET

[JURIST] The US Supreme Court [official website] ruled unanimously [opinion, PDF] Wednesday in Mohamad v. Palestinian Authority [SCOTUSblog backgrounder] that political organizations including the Palestinian Authority and the Palestine Liberation Organization are immune from liability under the Torture Victims Protection Act of 1992 (TVPA) [text]. The petitioners, relatives of a US citizen who was purportedly tortured and killed by Palestinian Authority officers during a visit to the West Bank, claimed human rights violations pursuant to the TVPA against an entity other than an individual person. The TVPA allows lawsuits to be brought in US courts against "any individual who, under actual or apparent authority, or color of law, of any foreign nation" subjects another individual to torture. The court, in reaching its conclusion, relied on the "ordinary, everyday meaning" of the word "individual," as well as federal statutes and a lack of Congressional intent that the language in the statute refer to a political or corporate entity. The court found the language to be unambiguous, and rejected the petitioners' assertions that legislative history and other federal tort statutes suggest the term "individual" should be read to include corporate and political entities.
The court's decision resolves a circuit split "with respect to whether the TVPA authorizes actions against defendants that are not natural persons." In February, the court heard arguments [JURIST report] in the related case of Kiobel v. Royal Dutch Petroleum Co. [SCOTUSblog backgrounder] about whether three oil companies are immune from US lawsuits under the Alien Tort Statute of 1789 (ATS) [text] for alleged torture and international law violations that took place overseas. The court is slated to hear rearguments next term in Kiobel to determine whether the ATS allows US courts to hear lawsuits for overseas violations of international law.


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Khadr requests transfer to Canada
Max Slater on April 19, 2012 6:50 AM ET

[JURIST] Canadian Guantanamo Bay [JURIST backgrounder] detainee and convict Omar Khadr [DOD materials; JURIST news archive] on Wednesday sent an application to the Canadian government requesting a transfer to his home state from the US military detention facility. In 2010 Khadr pleaded guilty to five charges [JURIST report] in a military tribunal, including killing a US soldier in Afghanistan in 2002. Khadr is the youngest prisoner to be held at the facility. Khadr's lawyer, John Norris, declared that Khadr is eager to return to Canada [CBC report] and become "a contributing member of society." Omar Khadr is the brother of Abdullah Khadr, a former Guantanamo detainee who was released last year [JURIST report]. Abdullah Khadr was detained at Guantanamo for supplying weapons to al Qaeda. According to Canadian Minister of Public Safety Vic Toews [official profile], the repatriation of Omar Khadr is being considered [AP report], and a decision is expected soon.
Omar Khadr was charged after he was captured following a firefight in Afghanistan in 2002 in which he threw a hand grenade that killed one US soldier and wounded another. In August 2010 the military judge rejected Khadr's claim that his confession was a byproduct of torture [JURIST report]. Earlier that August, the same judge ruled that Khadr's confession was admissible at trial [JURIST report]. Canada had previously declined to seek Khadr's repatriation [JURIST report] after his former lawyers obtained a ruling in the Supreme Court of Canada [official website] that the interrogation of Khadr by Canadian officials while in detention violated section 7 of the Canadian Charter of Rights and Freedoms [text]. According to the ruling, Canadian officials questioned Khadr, who was captured at age 15, even though they knew he was being indefinitely detained, and, in March 2004, he was questioned with knowledge that he was subjected to three weeks sleep deprivation by US authorities. Still, that ruling did not force the government to seek his repatriation.


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