“For the Record” CBA Record, January 2010

Recent Changes to the Federal Rules of Civil Procedure

On December 1, 2009, a number of technical, but quite significant, changes to the Federal Rules of Civil Procedure went into effect. Below is a brief summary of three of the most important elements of those amendments.

Rule 6. Computing and Extending Time; Time for Motion Papers Most important, under the new rules, intermediate weekend days and holiday count no matter how many days are provided for any given deadline. Fed. R. Civ. P. 6(a)(1)(B). Thus, if a rule provides for 10 days to file a brief, then that brief must be filed within the 10 days.

Rule 15. Amended and Supplemental Pleadings

The revised version of Federal Rule of Civil Procedure 15 changes when a plaintiff may amend their complaint without leave of court. Under the former Rule, a plaintiff had a right to amend its complaint once, as a matter of course, only before being served with a responsive pleading. The amended rule provides that a plaintiff may amend his complaint (without leave of court) a full 21 days after service of a responsive pleading or Rule 12(b) motion.

Rule 56. Summary Judgment

A motion for summary judgment may be filed immediately and the former 20-day waiting period is gone. Absent a local rule to the contrary, any party may now move for summary judgment at any time up until 30 days after the close of discovery. The response is due 21 days later, and the reply is due 14 days after that. Fed. R. Civ. P. 56(c)(1)(A).

Additional information can be found at http://www.uscourts.gov/rules/.

The Federal Rule of Appellate Procedure have been amended to provide that, absent leave of court, all reply briefs must be filed at least 7 days before oral argument, unless the court, for good cause shown, allows a later filing. The old rule permitted 3 days before oral argument. Fed. R. App. P 28.1(f)(4), 31(a). Also, the new rules specify that when a paper is due on a specific date, electronic filing will be timely until midnight in the court’s time zone, but that filings by other means must be received by the clerk’s office by the time the clerk’s office is scheduled to close. Fed. R. App. P 26(a)

The Circuit Rules and Operating Procedures for the U.S. Court of Appeals for the Seventh Circuit have a few changes regarding date changes, so consult the Court’s web site: http://www.ca7.uscourts.gov/.

Finally, the U.S. District Court for the Northern District of Illinois, pursuant to General Order 09-025, has amended its Local Rules to comply with the Statutory Time Period Technical Amendments Act of 2009. All time periods of less than 30 days are changed to multiples of 7 days and every calendar day, including weekends and holidays, is counted in determining a deadline date.

U.S. Court of Appeals Grants Writ of Mandamus and Orders District Court to Rule on Kuwati Resident’s Motion to Dismiss the Indictment Against Him

On December 11th, Circuit Judge Diane P. Wood, writing on behalf of a unanimous three-judge panel of the U.S. Court of Appeals for the Seventh Circuit (In re Ali Hijazi; No. 08-3060), granted petitioner’s petition for a writ of mandamus, and hereby order the district court promptly to rule on his motions to dismiss the indictment.

In late 2001, the U.S. Army contracted with Kellogg Brown & Root (“KBR”), a U.S. company, to provide both goods and services to the military at locations throughout the world, including in Kuwait. Co-defendant Jeff Alex Mazon, an American, was the procurement manager for KBR stationed in Kuwait. Among other things, he was responsible for hiring subcontractors to perform work under KBR’s contract. The Army concluded that it needed fuel tankers and related services at the Kuwaiti airport, which it used for military operations. Mazon accordingly solicited bids for the tankers in early 2003; KBR anticipated that the cost would be about $685,000.Two bidders responded: one was Ali Hijazi (a Lebanese citizen and a resident of Kuwait), who submitted a bid for 507,000 Kuwaiti Dinars (approximately $1,673,100) on behalf of his company, LaNouvelle General Trading & Contracting Co., a Kuwaiti company with no American ownership interests; the other is referred to only as Company A, which bid 573,300 Kuwaiti Dinars (approximately $1,891,890).

Mazon pushed the prices up more than threefold, so that LaNouvelle’s bid became $5,521,230, and Company A’s bid $6,243,000. So “adjusted,” Mazon then awarded the contract to LaNouvelle. The government alleges that he did so with the understanding that Hijazi would “reward” him for his efforts. Mazon and Hijazi signed the subcontract in Kuwait. Around the same time, Mazon sent four emails relating to the subcontract to KBR managers in the United States. Then, from March to August 2003, LaNouvelle submitted allegedly inflated invoices to KBR for its work, and KBR paid the anticipated $5,521,230. After paying LaNouvelle, KBR turned around and billed the United States for reimbursement; the Army complied, using checks and wire transfers. LaNouvelle itself had no direct dealings with the U.S. Army or the U.S. government.

In September 2003, Hijazi paid Mazon $1 million and executed a promissory note to make it appear that this represented a loan. Later, however, Hijazi sent an email to Mazon, to an account based in the United States, in which he wrote “this whole lown [sic] (principal & interest) totally your money....” Mazon himself, however, was not in the United States at that time. He was living and working in Greece during the relevant period, and that was where he received this email from Hijazi. In October 2003, back in the United States, Mazon opened a bank account where he unsuccessfully tried to deposit the $1 million. When that did not work, Hijazi emailed Mazon again (this time at his personal account, also allegedly based in the United States), instructing Mazon to open three different offshore accounts where he could deposit the money. Hijazi represents that Mazon opened this email in Greece as well. Mazon, however, tried again to deposit the funds in a different U.S. bank, on October 28, 2003. It is unclear whether the second bank was more accommodating.Twoweeks later, after he was interviewed by a KBR investigator, Hijazi sent a third email to Mazon warning him to be careful about what he said to his “ex-friends in Kuwait.” The government alleges that Mazon was back in the United States at the time he received this email.

Based on these facts, Hijazi and Mazon were indicted in the Central District of Illinois; the initial indictment was returned in 2005, and the Second Superseding Indictment was filed on August 3, 2006. Following his indictment, Hijazi surrendered voluntarily to Kuwaiti authorities, posted a $1,800 bond, and was released. There is no extradition treaty between the United States and Kuwait. Although the Department of Justice formally asked the Kuwaiti authorities to turn Hijazi over to it, through a diplomatic note dated September 13, 2005, Kuwait has refused to grant that request. All indications in the record continue to support the conclusion that the Government of Kuwait is unwilling to cooperate in this prosecution, insofar as it concerns Hijazi. In the meantime, the government proceeded with its prosecution of Mazon and Mazon pled guilty to a single misdemeanor count of making a writing containing a false statement, in violation of 18 U.S.C. § 1018.

The court noted that it was authorized to issue a writ of mandamus pursuant to 28 U.S.C. § 1651(a), the All Writs Act. See also Fed. R. App. P. 21. This writ is available in the federal courts only in extraordinary circumstances, either “to confine an inferior court to a lawful exercise of its prescribed jurisdiction or to compel it to exercise its authority when it is its duty to do so.” The Court cited and quoted the Supreme Court of the United States in Cheney v. United States Dist. Court for D.C., 542 U.S. 367 (2004) in that “the writ is one of the most potent weapons in the judicial arsenal.” In Cheney, the Supreme Court laid out the three conditions that must be satisfied before a writ of mandamus may issue. “First, the party seeking issuance of the writ [must] have no other adequate means to attain the relief he desires—a condition designed to ensure that the writ will not be used as a substitute for the regular appeals process. Second, the petitioner must satisfy the burden of showing that [his] right to issuance of the writ is clear and indisputable. Third, even if the first two prerequisites have been met, the issuing court, in the exercise of its discretion, must be satisfied that the writ is appropriate under the circumstances. These hurdles, however demanding, are not insuperable. This Court has issued the writ to restrain a lower court when its actions would threaten the separation of powers by embarrass[ing] the executive arm of the Government or result in the intrusion by the federal judiciary on a delicate area of federal-state relations.”

Thereafter, in the opinion, Circuit Judge Wood, then, walks through each of the three conditions and determined that Hijazi has met those conditions and granted his petition.

Second District Appellate Court of Illinois Rules the Village of Deerfield Can Sue ComEd for Bad Service

On December 15th, Justice Hudson writing on behalf of the Appellate Court of Illinois, Second District (Village of Deerfield v. Commonwealth Edison Co.; Docket No. 2-08-0917) ruled the village can sue the power company for bad service.

On April 17, 2008, the Village of Deer- field filed a three-count complaint against ComEd claiming ComEd broke its service agreement with the village and violated the Illinois Public Utilities Act by providing unreliable service to areas of the community. Deerfield officials alleged that during the period from 2000 until 2007, the Village suffered 82,347 individual customer power outages during 1,377 separate electrical failures. Count I, which is titled “Breach of Contract,” alleges that chronic electrical outages occurred within the village as a result of various breaches of ComEd’s duties under a “Franchise Agreement.” Count II was abandoned. Count III is titled “Civil Damages for Violation of Public Utilities Act.” This count sought class-action certification for all customers located within the village. It alleges that potential class members have suffered damages such as “spoiled food, purchase of electric generators to deal with [ComEd’s] unreliable service, property damage, temporary housing, [and] extra municipal and policing services.” The trial court dismissed plaintiff’s complaint with prejudice and ruled that the Illinois Commerce Commission has exclusive jurisdiction over utility disputes. It also found the third count was barred by the Moorman doctrine (holding that a “plaintiff cannot recover for solely economic loss under the tort theories of strict liability, negligent and innocent misrepresentation”).

Justice Hudson wrote that circuit court had jurisdiction because the plaintiff alleged deficient performance by ComEd, not excessive or discriminatory rates. However, in considering the doctrine of primary jurisdiction, which sets forth the orderly relationship between administrative and judicial decision making, the Court ordered that, in light that in the regulatory world of transmission of electric power, the Illinois Commerce Commission’s ability to apply consistent standards throughout the state favors allowing the Commission to consider this case. On remand, the trial court is to stay the proceedings and refer certain portions of this case to the Commission. After the Commission has had an opportunity to pass upon these matters, the trial court may engage in “whatever further proceedings are proper.”