Justia U.S. 1st Circuit Court of Appeals Opinion Summaries

McKenna and his wife, Suzette, refinanced with Wells Fargo, to help pay for his children's college education and granted a mortgage on their residence. On the same day, Wells Fargo provided the McKennas with a disclosure form stating the loan amount and terms. The mortgage was recorded. McKenna died; Suzette fell behind on payments. Under Massachusetts law, if a mortgage contains a "power of sale" (the McKenna mortgage did), the mortgagee may foreclose, without a judgment ordering sale, after a "limited judicial procedure" to establish that the mortgagor is not a member of the armed forces. Wells Fargo successfully brought such a proceeding and sent Suzette a notice of foreclosure sale. Suzette countered by asserting a right to rescind and filing suit to preclude the sale. She claimed that Wells Fargo had provided only one Truth in Lending disclosure statement at the time of the loan rather than two copies, and had understated the finance charge in its Truth in Lending statement by "more than $35.00." The district court dismissed. The First Circuit affirmed. The suit was not timely under the federal Truth in Lending Act, 15 U.S.C. 1635(a), and the complaint did not state claims under the equivalent state law.View "McKenna v. Wells Fargo Bank, N.A." on Justia Law

Malley’s former marital house sold shortly before filing his Chapter 7 bankruptcy petition and netted more than $250,000, from which he declared under oath that he had received nothing. The trustee believed that $27,000, allegedly going to the ex-wife, were to be used to discharge Malley’s credit card debt. In taking action against Malley's ex-wife to avoid that disposition, the trustee determined that Malley had hidden his secret receipt of $25,000. Malley claimed he was unable to turn over the money to the trustee when ordered to do so. Malley’s willful concealment of the funds violated 11 U.S.C. 521. When the trustee moved for sanctions, the court denied discharge, under 11 U.S.C. 727, and charged the concealed amount, plus the cost of untangling the fraud, against the value of an asset claimed as exempt, Malley’s truck. The First Circuit affirmed. Fraudulent concealment of non-exempt assets is an exceptional circumstance in which an offsetting surcharge against otherwise exempt property interests is reasonably necessary to protect the integrity of the bankruptcy process and to ensure that a debtor exempts an amount no greater than the Code permits.View "Malley v. Agin" on Justia Law

Sharfarz hired Goguen to build an addition to his house. Despite taking full payment, Goguen never finished the job. Sharfarz had to pay another to finish the work and sued consumer-protection laws, Mass. Gen. Laws ch. 93A; Mass. Gen. Laws ch. 142A. Sharfarz obtained a default judgment of $272,745. After an evidentiary hearing to assess damages, the state judge wrote that Goguen was "both deceptive and unfair, almost from the beginning and to the end," and that his "violations" had been "willful and knowing." Goguen filed for Chapter 7 bankruptcy. Sharfarz sought to have his judgment declared nondischargeable, under a provision that bars discharge of "any debt ... for money ... to the extent obtained by ... false pretenses, a false representation, or actual fraud" 11 U.S.C. 523(a)(2)(A). The bankruptcy judge denied the petition. The First Circuit vacated and remanded for determination of the nondischargeable amount. Goguen’s false statements were both the legal and factual cause of Sharfarz’s loss. View "Sharfarz v. Goguen" on Justia Law

Back Bay has operated a health club in Boston since 1995, renting space under a lease that is renewable through 2025. In 2004, a developer purchased the building and obtained a zoning variance to convert the building into mixed-use condominium units. Back Bay appealed the variance in 2005. It agreed to drop its objections to the project in exchange for the developer’s promise to sell it "Commercial Unit B," the space the health club occupies. Under its construction mortgage and related loan agreement, the developer was required to obtain the Bank's written consent for a sale of any condominium unit; those agreements specified a minimum sales price for retail units higher than the price stated in the Letter Agreement with Back Bay. Back Bay had at least constructive notice of the written consent requirement, as contained in the publicly recorded mortgage. The developer subsequently lost title to the property, by foreclosure, to a subsidiary of the Bank. The district court rejected a specific performance action by Back Bay. The First Circuit affirmed. View "Back Bay Spas, Inc. v. 441 Stuart Mktg., LLC" on Justia Law

Lynch is a highway construction contractor and a signatory of the Construction Industries of Rhode Island's collective bargaining agreement with Local 251, as representative of truck drivers employed by Lynch. Lynch employed 26 Local 251 members in 1995, 16 in 1997, and only 10 in 2001. Local 251's vice president, Boyajian, testified that each time a truck driver retired, Lynch would sell a truck and replace that person with a subcontractor, gradually reducing the number of bargaining unit employees. The collective bargaining agreement states that employers are not permitted to use subcontractors unless employees of the subcontractors are paid the prevailing rate. Boyajian complained to Lynch about its use of subcontractors that did not pay prevailing rate and, in 1999, filed grievances with the NLRB. Lynch and the union entered into a letter of agreement, which was later challenged as violating the National Labor Relations Act, 29 U.S.C. 158(e), by impermissibly preventing Lynch from doing business with two subcontractors. The NLRB upheld the challenge and subsequently sought enforcement. The First Circuit noted contradictory evidence that the Board failed to consider and reversed with respect to one company, while entering an order of enforcement with respect to the other.View "Nat'l Labor Relations Bd v. Int'l Bhd. of Teamsters, Local 251" on Justia Law

In 2008 Ziegler Holdings purchased the right to civil possession of a beachfront residence in Vieques, Puerto Rico, from plaintiffs and agreed to make monthly payments over four years, culminating in a balloon payment; maintain insurance on the Property; and indemnify plaintiffs for attorneys' fees of $5,000 in the event of an enforcement action. In 2010, Ziegler stopped making monthly payments, asserting that plaintiffs had misrepresented the property. Plaintiffs sought a declaration that the sale was void, return of the possessory interest, and $5,000 in attorneys' fees. Ziegler failed to timely submit its pretrial memorandum, frustrated plaintiffs’ efforts to have the parties meet and confer regarding discovery, and did not disclose materials described in a court order. Following several court dates and warnings, the district court entered default judgment against Ziegler. The First Circuit affirmed the default judgment, but vacated in part because the court had entered judgment beyond what plaintiffs were entitled to. The court remanded for entry of a revised judgment limited to declaratory relief, possession of the Property, and attorneys' fees. View "Hooper-Haas v. Ziegler Holdings, LLC" on Justia Law

Based on challenges of planting evidence and conducting illegal searches and seizures, officers in the Puerto Rico Police Department were convicted (in different combinations) of conspiring to injure, oppress, threaten, and intimidate persons in the town of Mayagüez in the free exercise or enjoyment of their constitutional rights, 18 U.S.C. 241, and conspiring to possess with intent to distribute controlled substances 21 U.S.C. 841(a)(1) & 846. The First Circuit affirmed all convictions against challenges to the sufficiency of the evidence. View "United States v. Santiago-Mendez" on Justia Law

Green Mountain owns cellular phone towers and leases space to federally licensed providers of wireless telecommunications services, who mount antennae on the towers to service their cellular networks. Green Mountain entered into an agreement with an agency of the Commonwealth of Massachusetts to lease land in Milton, an unzoned triangular section, approximately 2,700 square feet, formed by the intersection of I-93 and the southbound on-ramp. Applications to the Town Zoning Board of Appeals and the Milton Conservation Commission were denied. Green Mountain challenged the decisions as not supported by "substantial evidence," as required by the Telecommunications Act of 1996, 47 U.S.C. 332(c)(7)(B)(iii); as constituting an "effective prohibition" on provision of wireless services in the area in violation of the TCA; and as violating Massachusetts state law. The district court granted summary judgment upholding the denials. The First Circuit affirmed with respect to the substantial evidence claims, but vacated in part. The district court did not adequately address evidence supporting the effective prohibition claim. View "Green Mountain Realty Corp. v. Leonard" on Justia Law

In 2004, Edlow agreed to purchase three residential condominium units in RBW's luxury development, consisting of a Residential Unit, a Commercial Unit, and a Hotel Unit. It was anticipated that the Regent Hotel would operate the Hotel and that residential occupants would have privileged access to hotel amenities. According to marketing materials the Regent Boston was to offer a spa, meeting space, a signature restaurant by a Michelin chef, 24-hour concierge service, and an executive business center. When construction fell behind, RBW exercised its rights to extend closing dates several times. RBW representatives assured Edlow that "all promised amenities would be available." Edlow affirmed his commitment to purchase two units, but was released from obligation to buy one. The closing for the first unit took place in May 2008. In June, RBW informed Edlow that Regent was pulling out. In July, RBW informed him that the replacement hotel would not offer property management and concierge services discussed in original marketing materials. Despite these notices, Edlow executed a new agreement. Days later, Edlow demanded return of deposits on the remaining unit. Edlow sued, alleging contract, tort and statutory claims. The district court dismissed. The First Circuit affirmed. View "Edlow v. RBW, LLC" on Justia Law

Defendant pleaded guilty to possessing counterfeit securities and possessing a firearm as a felon, 18 U.S.C. 513(a), 922(g)(1). The presentence report recommended a guideline sentencing range of 70 to 87 months, based on a provision calling for an increased base offense level if a defendant, convicted of unlawful firearm possession, has previously sustained two felony convictions of either a crime of violence or a controlled substance offense. USSG 2K2.1(a)(2). The guideline cross-references USSG 4B1.2(a) to defined "crime of violence." Defendant conceded that he had a prior drug conviction, but argued that conviction for assault and battery on a correctional officer, Mass. Gen. Laws ch. 265, sect. 13D, was not a conviction for a crime of violence. The district court disagreed and, varying downward, imposed a 60-month term. The First Circuit affirmed. Under the career offender guideline, a crime of violence is any offense punishable by more than one year of imprisonment that either has as an element the use, attempted use, or threatened use of physical force against the person of another, or is burglary of a dwelling, arson, or extortion, involves use of explosives, or otherwise involves conduct that presents a serious potential risk of physical injury to another. View "United States v. Jonas" on Justia Law