June 26, 2019

Archives for January 25, 2019

Tenth Circuit: Hobbs Act Robbery is “Crime of Violence” Because Force Element Can Only be Satisfied with Violent Force

The Tenth Circuit Court of Appeals issued its opinion in United States v. Jefferson on Friday, December 28, 2018.

Defendant Jefferson was convicted of five counts of Hobbs Act robbery under 18 U.S.C. § 1951, as well as two counts for brandishing a firearm during and in relation to a crime of violence in violation of 18 U.S.C. § 924(c)(3)(A).

On appeal, Jefferson argued that the district court erred when it determined that robbery under § 1951 qualifies as a crime of violence under § 924(c)(3)(A) and that even if it did, the judge erred in directing a verdict on that element and the issue should have been submitted to a jury. Further, the district court erred when it refused to instruct the jury that “force” in § 1951 means “violent force,” and the prosecutor’s closing rebuttal arguments amounted to prosecutorial misconduct and violated his due process rights.

The Tenth Circuit affirmed the district court, and held that Hobbs Act robbery categorically qualifies as a “crime of violence,” and that both the district court’s error in failing to instruct the jury that “force” in § 1951 means “violent force” and that the prosecutor’s alleged error during closing rebuttal arguments were harmless beyond a reasonable doubt. 

On the issue of whether a crime fits the § 924(c) definition of a “crime of violence,” the Tenth Circuit reiterated its holding in United States v. Morgan, citing that such issue requires an examination of the legal elements of a crime, not an exploration of the underlying facts, and is therefore not a question of fact for a jury, but a question of law for the judge. Therefore, the judge did not err and in fact was obligated not to submit the issue to the jury.

The Tenth Circuit next considered whether Hobbs Act robbery is a “crime of violence” under § 924(c)(3)(A). Section 924(c) calls for increased penalties if a firearm is used or carried “during and in relation to any crime of violence” and defines “crime of violence” as a felony offense having “as an element the use, attempted use, or threatened use of physical force against the person or property of another.” 18 U.S.C. § 924(c)(3)(A). In a Hobbs Act robbery, one element the government must prove is the use of actual or threatened force, violence, or fear of injury.

Jefferson argued Hobbs Act robbery is not a “crime of violence” because force is a means of committing the crime, not an element of the crime. The Tenth Circuit agreed that force is a means of committing the crime, but disagreed that this determination ended the inquiry as to whether a statute “has as an element the use, attempted use, or threatened use of physical force against the person or property of another.” Instead, the determination of whether statutory alternatives are elements or means is only important in deciding whether to apply the pure categorical approach or the modified categorical approach. Because the Hobbs Act statute alternatives are means, the pure categorical approach applies. Therefore, the distinction between means and elements only matters if one of the ways to commit Hobbs Act robbery did not involve force, so that a juror could find a defendant guilty irrespective of whether he used force to commit the crime. The Tenth Circuit agreed with the proposition that placing one in fear of injury requires the threatened use of physical force. The Circuit further reasoned that because violence is defined as “the use of physical force so as to injury, abuse, damage, or destroy,” each of the alternatives requires the threatened use of force, Hobbs Act robbery is categorically a “crime of violence” under § 924(c)(3)(A).

On the issue of whether the district court erred in its jury instructions, Jefferson argued that the jury should have been instructed that “force” in Hobbs Act robbery means “violent force.” The Tenth Circuit agreed. However, the error was found to be harmless because the evidence provided uncontroverted proof of “violent force” being used in each robbery. In the first robbery, Jefferson caused actual injury to a person. In the second and third robbery, Jefferson had engaged in a “tug-of-war” with the convenience store clerk and the store’s front door, which had the capacity to cause physical injury or pain to the store clerk. In the fourth and fifth robbery, surveillance videos showed Jefferson pointing a gun to the clerk’s head from a short distance away. Therefore, the district court’s error in failing to instruct the jury that “force” in Hobbs Act robbery means “violent force” was harmless beyond a reasonable doubt.

On the final issue, Jefferson argued that the prosecutor’s rebuttal closing argument that the “possibility that the gun is fake is not something that [the government has] to overcome” improperly shifted the burden of proof to Jefferson. The Tenth Circuit disagreed, finding that the challenged statements may have misstated the law as to the government’s burden of proof, but the alleged error was harmless because the jury had been correctly instructed and reminded of the government’s burden after closing arguments. Further, the extent and role of the misconduct was minimal—the challenged statements constituted only two sentences of the governments lengthy closing argument and a 4-day trial, and while the prosecutor may have arguably misstated the law, she corrected herself by stating “we do not have to disprove theoretical possibilities that a gun is fake and not real.” Finally, the evidence of guilt was substantial. In light of this, the Tenth Circuit concluded that the alleged error was harmless beyond a reasonable doubt.

Tenth Circuit: Despite Probability of Ongoing Harm, Business Failed to Show Former Employee’s Solicitation Violated Business Agreement

The Tenth Circuit Court of Appeals issued its opinion in DTC Energy Group, Inc. v. Hirschfeld on Friday, December 28, 2018.

The district court denied plaintiff DTC Energy Group’s motion for preliminary injunctive relief. On appeal, the Tenth Circuit Court of Appeals affirmed.

DTC is a staffing and consulting firm, and has sued two of its former employees—Adam Hirschfeld and Joseph Galban—as well as a competing firm, Ally Consulting, LLC, for using DTC’s trade secrets to divert business from DTC to Ally.

Hirschfeld worked for DTC as a business development manager, and had signed an employment agreement that included confidentiality, non-solicitation, and non-interference provisions.  The confidentiality provision prohibited Hirschfeld from using DTC’s confidential information for his own benefit or the benefit of another company. The non-solicitation and non-interference provisions prohibited Hirschfeld from encouraging DTC’s current customers to take their business to a competitor and from recruiting DTC’s employees to work for a competitor, for the duration of his employment with DTC and for a period of 1-year thereafter, unless he resigned due to a change in ownership.

While employed by DTC, Hirschfeld used DTC’s resources to win business for Ally, allegedly in violation of his duty of loyalty to DTC and his employment agreement. Hirschfeld resigned from DTC in May 2017, citing a change in ownership. Upon his resignation, Hirschfeld took a flash drive containing DTC’s confidential information, and also kept his laptop logged into DTC’s Dropbox account so he could continue accessing DTC’s confidential information after his departure. The day after leaving DTC, Hirschfeld began working at Ally as its director of business development.

In September 2017, DTC filed its amended complaint and moved for preliminary injunction based on its claims for breach of contract, breach of duty of loyalty, misappropriation of trade secrets in violation of the federal Defend Trade Secrets Act and Colorado’s Uniform Trade Secrets Act, and unfair competition. The district court denied the motion, finding the duty of loyalty owed by defendants to DTC and the non-solicitation clause of Hirschfeld’s employment agreement had expired, and that DTC was unable to show a significant risk of future misappropriation of trade secrets and unfair competition. The district court reasoned that because a majority of the conduct at issue had occurred before DTC moved for a preliminary injunction, the resulting harm to DTC was therefore identifiable and could be remedied by an award of damages.

On appeal, DTC argued that the district court’s finding that DTC had established a significant risk of irreparable harm based on defendants’ past misconduct was erroneous because it failed to take into consideration the harm DTC continues to suffer as a result of defendants’ past misconduct—specifically the harm to DTC’s goodwill and competitive market position.

In its review of the district court’s decision, the Tenth Circuit focused on the showing of irreparable injury in the absence of the issuance of a preliminary injunction. The district court had found that DTC had shown a probability of irreparable harm from Hirschfeld’s ongoing breach of his employment agreement, but not with respect to DTC’s other claims.

DTC’s trade secret claims did not establish a probability of irreparable harm because there was no evidence in the record that defendants retained access to DTC’s confidential information or trade secrets. While the federal Defend Trade Secrets Act and Colorado’s Uniform Trade Secrets Act authorize preliminary injunctive relief to prevent actual or threated misappropriation of a trade secret, the Tenth Circuit concluded that DTC had not offered sufficient evidence that defendants currently possessed DTC’s trade secrets or would be likely to regain access to DTC’s trade secrets.

DTC’s unfair competition claim did not establish a probability of future irreparable harm because DTC had offered no evidence that Ally continues to appropriate DTC’s name or resources to solicit business, nor was there any evidence demonstrating ongoing confusion within the industry as to the relation between the two companies.

DTC’s breach of duty of loyalty claim also did not give rise to a future of irreparable harm. Because DTC identified the 12 contracts that Hirschfeld diverted from DTC to Ally and had previously hired experts to value the company during the change of ownership, the Court of Appeals reasoned that both the prior loss of DTC’s customers and consultants and the general decline of DTC’s value of a business could be quantified in money damages.

While DTC had shown a probability of future irreparable harm from Hirschfeld’s ongoing solicitation of DTC’s customers and consultants, the district court still denied injunctive relief as DTC had not shown a likelihood of success on the merits of the claim. The district court found that Hirschfeld was not bound by his employment’s non-solicitation provision as the change in ownership clause provision had been triggered.

On appeal, DTC argued that the prior breach doctrine prevented Hirschfeld from relying on the change in ownership clause, stating that Hirschfeld could not claim the benefit of the contract’s change in ownership clause after he had already violated the contract by improperly diverting business to Ally prior to his resignation. The Tenth Circuit agreed with the district court’s finding that the prior breach doctrine was inapplicable, as this was not an instance where DTC was defending against a demand specific performance, and the text of the employment agreement itself did not prevent Hirschfeld from relying on the provision in instances of prior breach. The Circuit went on to say that Hirschfeld’s present solicitation of DTC’s customers and consultants would not support issuing a preliminary injunction because the injunction would exceed the 1-year durational scope of the non-solicitation (the agreement’s provisions had expired prior to the time of the appeal).

In his concurrence, Judge McHugh wrote that in some circumstances an injunction can supported by the irreparable harm caused by defendants’ legal actions that would not have been possible but for their past breaches, as courts will sometimes enjoin future legal conduct because it was made possible by prior illegal conduct and will cause irreparable harm to the plaintiff. However, DTC had not pointed to any evidence of future irreparable harm stemming from defendants’ past misconduct (e.g., evidentiary support that DTC’s goodwill and competitive market position continues to be harmed) in the record that should have been considered by the district court, therefore the district court’s denial should be affirmed.

Colorado Court of Appeals: Announcement Sheet, 1/24/2019

On Thursday, January 24, 2019, the Colorado Court of Appeals issued ten published opinions and 32 unpublished opinions.

People v. Coahran

Security Credit Services, LLC v. Hulterstrom

Roybal v. City & County of Denver

People v. Terry

Stiles v. Department of Corrections

Brown v. American Standard Ins. Co. of Wisconsin

Tallman v. Aune

In re Marriage of Thorstad

People v. Rieger

Garrou v. Shovelton

Summaries of these cases are forthcoming.

Neither State Judicial nor the Colorado Bar Association provides case summaries for unpublished appellate opinions. The case announcement sheet is available here.


Tenth Circuit: Unpublished Opinions, 1/24/2019

On Thursday, January 24, 2019, the Tenth Circuit Court of Appeals issued two published opinions and one unpublished opinion.

United States v. Tapia

Case summaries are not provided for unpublished opinions. However, some published opinions are summarized and provided by Legal Connection.