On April 19, 2021, New York Chief Judge Janet DiFiore issued a message requiring all judges and court staff, including clerks, officers, and other employees, to return to in-person work effective Monday, May 24, 2021. The order comes on the heels of the state of New York resuming civil and criminal jury trials on March 22, 2021. The return to in-person work for all staff marks the end of the work-from-home measures which had been in place for fourteen (14) months. As part of the press release, Chief Judge DiFiore stated: “It is time to return to our normal and full courthouse staffing levels in order to support the fuller resumption of in-person operations, including jury trials and other proceedings in our courts.”
Notwithstanding the return to in-person work for staff, New York courts will continue to utilize virtual and telephonic court proceedings developed and implemented in response to the coronavirus pandemic. Chief Judge DiFiore confirmed that plans are being drafted to ensure protocols for the effective use of technology for conferences and hearings (which do not require in-person attendance by attorneys and parties) are in place so as to limit the number of people in the state courthouses to maintain safe occupancy levels. The return of normal operations is both welcome and critical, as Judges and staff attempt to dig out from the backlog of cases caused by the pandemic.
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On March 4, 2021, the United States Court of Appeals for the Ninth Circuit issued an opinion reversing the conviction of Defendant James P. Lucero under the Clean Water Act (the “CWA”) and remanding the case to the United States District Court for the Northern District of California for a new trial. Lucero was charged with three (3) counts of knowingly discharging a pollutant near the San Francisco Bay in violation of the CWA. A jury found Lucero guilty on all three counts and he was sentenced to thirty (30) months in prison. Lucero appealed his conviction to the Ninth Circuit and argued for reversal of the conviction on the following grounds: (1) the jury instructions erroneously omitted the knowledge element contained in the CWA; (2) the definition of “waters of the United States” is unconstitutionally vague; and (3) the narrower April 2020 regulatory definition of “waters of the United States” should be applied retroactively to his case.
As for the first challenge to the conviction, the government argued that the knowledge requirement under the CWA should be interpreted to extend only to the phrase “into water” and not to “waters of the United States.” In a split 2-1 decision, the Ninth Circuit agreed with the government’s position, holding that Congress intended the broadest possible protection against water pollution. The Court held that the phrase “waters of the United States” is simply a jurisdictional element to connect the CWA to Congress’s powers under the Commerce Clause and to confine the constitutional boundaries without extension to every “water” in the United States. Circuit Judge Bade dissented in this portion of the decision, holding: “the ‘waters of the United States’ element substantively defines the discharge prohibition because it plays an integral role in ‘defin[ing] the evil Congress seeks to prevent’ through the CWA, no other statutory or regulatory provision can plausibly substitute for it in this role, and the majority’s chief reason not to read both “waters of the United States” and “into water” (substantively—the rule against surplusage—), is unconvincing given the use of the definitional provisions across the CWA.”
Although the Court agreed with the government’s interpretation of “knowingly,” the Ninth Circuit held that reversal and remand is necessary because the jury instructions failed to adequately convey the knowledge element to the jury. The Court noted that the government had the burden to prove that Lucero knew he was discharging the pollutants “into water.” The Court interpreted the CWA to require that for a defendant to knowingly add a pollutant, the defendant “must know that he discharged an enumerated substance from a conveyance, and that the substance was discharged into water.” To require knowledge by a defendant of dumping “into water” is to ensure that a defendant knows he is committing a crime targeted by Congress. The Ninth Circuit further held that the jury instruction erroneously omitted the CWA’s mens rea element and provided that nowhere in the instruction did it indicate that Lucero had to know he discharged the pollutant “into water.” Finally, the Court held that the failure to include the knowledge element in the jury instruction was not harmless error and as such the conviction had to be reversed as a matter of law.
The remaining arguments by Lucero were rejected by the Court. The Ninth Circuit held that the regulation defining “waters of the United States” is not unconstitutionally vague and noted that although the regulations definitions are complex, they provide an ascertainable standard for when “wetlands” and “tributaries” constitute jurisdictional waters of the United States. The Ninth Circuit also rejected the third argument made by Lucero, holding that the 2020 regulation is to be applied prospectively and is not a judicial interpretation of an existing law that is to be applied retroactively to Lucero’s case.
To read the full opinion, please click here.
For more information about the Clean Water Act or other environmental laws and regulations, please do not hesitate to contact us at firstname.lastname@example.org.
On January 14, 2021, outgoing Assistant Attorney General Jeffrey Bossert Clark released a memorandum outlining the Environment and Natural Resources Division’s (ENRD) enforcement principles and priorities for the “robust enforcement of our nation’s environmental laws.” AAG Clark emphasized eight (8) general principles which are at the forefront of ENRD’s consideration for civil and criminal enforcement and also summarized five (5) areas which had been a priority for the Trump Administration. Pursuant to the Trump Administration directives, ENRD was tasked with focusing on (1) clean water, clean air, and clean land; (2) maintaining the integrity of environmental programs; (3) fighting fraud and recovering taxpayer funds; (4) combating violent and organized crimes; and (5) protecting workers, competitiveness, and the infrastructure during the past administration.
AAG Clark was sworn into the role as head of the ENRD on November 1, 2018. Prior to that, he was in private practice at Kirkland & Ellis. He had also served in the ENRD during the George W. Bush Administration from 2001 – 2005. The memorandum is a summary of the approach taken by the Justice Department’s chief environmental enforcement arm during what was often characterized by observers as a pro-business and anti-environment Administration. Some of the more interesting guideposts from the memorandum include the following instructions to DOJ attorneys:
- ENRD enforcement actions should be premised solely on existing legislation of the statute and not the legislative history, agency guidance documents, and/or executive order policy announcements.
- ENRD attorneys should respect the corporate form and not simply group affiliated and/or related entities together. The ENRD “should give due respect to the policy judgment of lawmakers to create and maintain the corporate form.”
- Criminal enforcement should be rare and reserved for instances when there is a requisite and demonstrable criminal intent. The Department must avoid unnecessary “overcharging” of crimes.
- Settlements should impose remedies consistent with applicable statutory authority and the payment of any settlement funds to third parties is prohibited (citing Attorney General June 5, 2017 Memo). In addition, except where Congress has specifically provided otherwise, the use of Supplemental Environmental Projects (SEPs) is prohibited. SEPs were often provided as a settlement option to an alleged environmental violator to reduce overall monetary liability by agreeing to fund an environmental project.
It can be expected that as soon as a new Assistant Attorney General for the ENRD is appointed and sworn in, a new memorandum with revised policy goals and instructions reflecting the Biden Administration will be issued. Anticipated Attorney General Merrick Garland will certainly have a strong voice in directing the approach of the ENRD as well. One of the first changes that may be instituted is the reintroduction of the SEP program, a policy which had been very popular during the Obama administration (and had been used for decades before that by the Environmental Protection Agency and DOJ). There is at least one (1) lawsuit pending in the U.S. District Court for the District of Massachusetts seeking to reintroduce the program on the grounds that the Justice Department’s current interpretation and application of the law prohibiting the use of SEPs is a violation of the Administrative Procedures Act. Underscoring the Administration’s focus on the environment, during his first day in office, President Biden has already signed executive orders to re-enter the Paris Climate Agreement and to suspend work on the Keystone XL pipeline. It is expected that robust instructions to federal agencies to investigate and enforce Clean Air Act and Clean Water Act violation(s), among others, will also be a top priority of the Biden Administration.
A copy of the Memorandum can be found here.
For more information on administrative, civil, or criminal environmental enforcement actions, please do not hesitate to contact us at email@example.com
We are pleased to announce that Mrs. Otero Valdés together with Corey D. Ranslem of International Maritime Security Associates, Inc. (IMSA) will be presenting via webinar at the International Underwriting Association (IUA) Market Briefing to discuss cyber security issues within the maritime industry, case studies, and the keys to cyber security planning and cyberattack “avoidance.” The webinar will take place on January 26, 2021 at 10:00 a.m. EST.
To register for the program please click here.
For more information, please do not hesitate to contact us at firstname.lastname@example.org or email@example.com.
Earlier this year, we reported on the decision issued by Chief Magistrate Judge David Rush of the Western District of Missouri recommending that all federal criminal charges against the Captain (and two (2) shore-side managers) of a duck boat, which tragically sank on Table Rock Lake in Missouri in July 2018 and led to the deaths of seventeen (17) people, be dismissed for lack of admiralty jurisdiction. The government filed numerous objections to the findings of fact and conclusions of law in the Magistrate Judge’s Report and Recommendation. Both sides filed supplemental briefing and other supporting documents for the District Court’s review. The government’s chief argument was that the Magistrate Judge erred in holding that the navigability of Table Rock Lake was a legal issue on which prior Eighth Circuit precedent binds the Court. Specifically, the Report and Recommendation had relied on a decades old civil case (Edwards v. Hurtel, 724 F.2d 689, 689-90 (8th Cir. 1984)), in which the district court and Eighth Circuit had taken judicial notice that the lake was recreational in nature and not used for commercial shipping and/or otherwise navigable. The government argued that the facts of the instant criminal matter, show “that the physical characteristics of the lake can, and do, support interstate commercial shipping, and that goods and people are currently transported on the lake across state lines for profit,” are different. The government argued that it should have been permitted the opportunity to prove its facts at trial and the prior Circuit Court precedent relied upon in the Report and Recommendation is inapplicable and non-binding based on the facts of the present case.
As the Magistrate Judge’s recommended opinion would result in the dismissal of the case if accepted, the District Court Judge was required to conduct an independent review of the record, hearing transcript, parties’ briefing, and applicable law before rendering a final decision. On December 3, 2020 District Judge Douglas Harpool issued a single page Order adopting the Report and Recommendation in full and dismissing the case (and all charges) against the defendants for lack of admiralty jurisdiction. No independent analysis of the government’s objections or arguments was provided by the District Court. The Clerk of the Court promptly entered the judgment closing the case. The government has since appealed the decision to the Eighth Circuit Court of Appeals. A briefing schedule will be set by the Circuit Court for early 2021.
A copy of the Order adopting the Report and Recommendation and dismissing the case can be found here.
For any questions about the decision or to learn more about the criminalization of admiralty matters in the United States, please contact us at firstname.lastname@example.org.
Article by George M. Chalos & Briton P. Sparkman featured in TradeMaker Magazine’s December 2020 edition can be viewed by clicking here.
Article by George M. Chalos & Briton P. Sparkman featured in the November 2020 issue of TradeMaker Magazine can be viewed by clicking here.
On November 5, 2020, Briton P. Sparkman of Chalos & Co, P.C. attended and presented at the Maritime Law Association Virtual Fall Meeting for the Uniformity Committee on U.S. Maritime Law. Mr. Sparkman’s presentation was on the split in recent Circuit Court of Appeals opinions interpreting the ability of district courts to grant discovery in aid of a foreign proceedings pursuant to 28 U.S.C. § 1782. Specifically, the different approaches taken by the Second, Fifth, and Seventh Circuits in holding that such discovery is not available for foreign private arbitration and the Fourth and Sixth Circuits which have said that it is. The meeting also included a presentation by Committee Chair, Professor Michael Sturley on Circuit conflicts in cargo law.
The presentation provided Continuing Legal Education (“CLE”) credit for the 85+ attendees of the meeting and was recorded to be added to the MLA’s CLE library in the near future.
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On October 8, 2020, the United States Court of Appeals for the Second Circuit issued an unpublished opinion affirming judgment of the United States District Court for the Southern District of New York, that a vessel operator’s bankruptcy and voluntary termination of various service contracts relieved the shippers of any obligation to pay liquidated damages under the contract. In re: The Containership Company (TCC) A/S, 19-3394 (2d Cir. Oct. 8, 2020). Plaintiff, The Containership Company (TCC), provided trans-Pacific container-shipping services between Los Angeles, California and various ports in China. TCC entered into several service contracts with shippers who agreed to ship a “minimum quantity commitment of cargo” on board vessels chartered by TCC for the period of April 2010 – April 2011. The contracts between TCC and the shippers provided for liquidated damages for any shortfall in the minimum quantity commitment. On or about April 7, 2011, TCC announced that it would discontinue its trans-Pacific shipping services and cancelled the remaining scheduled sailings. After withdrawing the previously chartered vessels and terminating all employees, TCC sent demand letters to Defendants alleging they had failed to meet the minimum quantity commitment.
TCC initiated bankruptcy proceedings in Copenhagen, Denmark and obtained Chapter 15 recognition of the foreign bankruptcy proceeding in the United States Bankruptcy Court for the Southern District of New York. Shortly thereafter, TCC commenced seventy-six (76) adversary proceedings against Defendants, each containing a single claim for breach of the service contracts. The Bankruptcy Court recommended that judgment be entered in favor of the Defendant shippers on the basis that TCC’s discontinuation of the trans-Pacific service constituted voluntary termination of the service contracts and relieved Defendants of their remaining minimum quantity commitments. The District Court affirmed the Bankruptcy Court’s order.
On appeal, the Second Circuit agreed that under the plain language of the contracts, TCC’s discontinuance of service constituted termination of the contracts which excused all parties from penalty or further contractual obligations. The Second Circuit further concluded that TCC’s discontinuance of its trans-Pacific service deprived Defendants of the opportunity to fulfill their minimum quantity commitments under the contracts and excused Defendants from complying with any other contractual obligations. TCC’s alternative argument that the contracts had been breached before the voluntary discontinuance because the shippers had not “shipped the goods evenly” over the contract term was rejected out of hand by the Court on the basis that the contracts did not contain any objective or clear guidelines against which to measure such efforts. Accordingly, the Second Circuit affirmed the judgment in favor of the shippers.
To read the full opinion, please click here.
For more information about the Second Circuit decision or U.S. Bankruptcy law as it relates to maritime contracts and claims, please do not hesitate to contact us at firstname.lastname@example.org.