Recent weeks have brought more opinions regarding the issue of whether specific arbitration agreements are enforceable. However, as two recent opinions show, these decisions continue to be fact-specific in virtually all instances, and judge and/or state-law specific in others. In the first case, Carey v. 24 Hour Fitness USA Inc., relying on Texas state law, the Fifth Circuit affirmed a lower court’s decision holding that an arbitration agreement allowing the employer to unilaterally change the terms lacked the necessary consideration to render the agreement enforceable. In a second case, LaVoice v. UBS Financial Services, Inc., a court within the Southern District of New York examined a different arbitration-related issue- the substantive unconscionability of a collective action waiver- concluding that compelling a potentially high value FLSA claim to arbitration on an individual basis does not conflict with the substantive law regarding the FLSA’s collective action provisions. Significantly, the court’s conclusion in this regard appears to conflict with another recent holding discussed here, in which another court within the same district held that collective action waivers are unenforceable per se, because they prevent employees from vindicating their substantive statutory rights under the FLSA.
Carey v. 24 Hour Fitness USA Inc.
“The Fifth Circuit on Wednesday allowed a proposed overtime class action against 24 Hour Fitness USA Inc. to go forward, finding an arbitration agreement at issue contained an ‘escape hatch’ for the fitness chain that made it unenforceable.
In a unanimous, published opinion, the appeals court upheld a Texas federal court’s ruling that the arbitration agreement in 24 Hour Fitness’ employee handbook was illusory because it allowed the company to retroactively modify or terminate the agreement.
Because 24 Hour Fitness reserved the right to unilaterally adjust the conditions of employment — including those which required employees to arbitrate claims on an individual basis — the appeals court found that the arbitration agreement was invalid from the outset.
‘If a 24 Hour Fitness employee sought to invoke arbitration with the company pursuant to the agreement, nothing would prevent 24 Hour Fitness from changing the agreement and making those changes applicable to that pending dispute if it determined that arbitration was no longer in its interest,’ the panel said.
Click Carey v. 24 Hour Fitness USA Inc. to read the entire Fifth Circuit Opinion.
LaVoice v. UBS Financial Services, Inc.
“…LaVoice also argues that the arbitration agreements between him and UBS are unenforceable because they would preclude him from exercising his statutory rights. To support this position, LaVoice likens the class waivers in the instant case with those that were found unenforceable in the Amex line of cases. LaVoice also draws comparison between his circumstances and those of the plaintiff in Sutherland v. Ernst & Young LLP, 768 F.Supp.2d 547 (S.D.N.Y.2011).
The enforceability of a class action waiver in an arbitration agreement must be considered on a case-by-case basis “on its own merits, governed with a healthy regard for the fact that the FAA is a congressional declaration of a liberal federal policy favoring arbitration agreements.” Amex II, 634 F.3d at 199. Turning to the class waiver at issue and LaVoice’s specific circumstances, this Court finds that the “practical effect of enforcement of the waiver” in the instant case would not “preclude” LaVoice from exercising his rights under the statutes. Id. at 196. The Court comes to its finding that LaVoice’s statutory rights will not be precluded by enforcement of the class waiver after reviewing his submissions regarding: his estimated damages claim, his estimated attorneys’ fees, his estimated expert fees, his disinclination to pursue his claims individually, his counsel’s disinclination to pursue the claims individually, and his likelihood of success at arbitration.
Although LaVoice and Defendants contest the value of LaVoice’s overtime claim, in reaching its decision, the Court accepts the figure cited in LaVoice’s own opposition papers of overtime claims between $127,000 to $132,000. Aff. Jeffrey G. Smith in Supp. of Opp’n. to Mot. to Compel Arbitration at ¶ 5. Assuming this self-reported value of claims, the Court finds that LaVoice’s circumstances differ drastically on their face from those of the plaintiffs in either the Amex line of cases or Sutherland. Plaintiffs in those cases could each only claim de minimus damages of less than $6000.
The court also evaluated and rejected plaintiff’s claim that expert costs to be incurred would be prohibitive in an individual claim, whereas spreading the cost over a collective group would be more palatable and rejected same, in the context of plaintiff’s proffered argument that his counsel would be disinclined to pursue his claims on an individual basis by themselves.
Click LaVoice v. UBS Financial Services, Inc. to read the entire Memorandum and Order compelling the case to arbitration on an individual basis.
As more and more cases are decided following recent United States Supreme Court jurisprudence on arbitrability and class waiver issues, it’s becoming more and more clear that the results are very fact-specific to each case. Hopefully, higher courts will begin to weigh in on some of the broader issues and give some clarity in the near future.
This case was before the court on defendant’s motion to compel arbitration on an individual (rather than class) basis. Although the court noted that plaintiffs were required to sign the arbitration agreement contained in their compensation agreements, under threat of forfeiture of commissions, the court held that did not make the agreement unenforceable as entered into under duress. The court also, in large part, dismissed other arguments regarding the substantive and procedural unconscionability of the agreement. However, as discussed here, the court held that the confidentiality provision which barred any discussion of the litigation without the other party’s consent to be far too broad.
All aspects of the arbitration, including without limitation, the record of the proceeding, are confidential and shall not be open to the public, except (a) to the extent both Parties agree otherwise in writing, (b) as may be appropriate in any subsequent proceedings by the Parties, or (c) as may otherwise be appropriate in response to a governmental agency or legal process, provided that the Party upon whom such process is served shall give immediate notice of such process to the other Party and afford the other Party an appropriate opportunity to object to such process.
At the request of a Party or upon his or her initiative, the Arbitrator shall issue protective orders appropriate to the circumstances and shall enforce the confidentiality of the arbitration as set forth in this article.
In Davis, the Court of Appeals for the Ninth Circuit stated that, under California law, “[c]onfidentiality by itself is not substantively unconscionable,” but the employer’s “confidentiality clause … is written too broadly” and “unconscionably favors [the employer],” when the clause at issue “would prevent an employee from contacting other employees to assist in litigating (or arbitrating) an employee’s case.” Davis, 485 F.3d at 1078–79 (“The clause precludes even mention to anyone ‘not directly involved in the mediation or arbitration’ of ‘the content of the pleadings, papers, orders, hearings, trials, or awards in the arbitration’ or even ‘the existence of a controversy and the fact that there is a mediation or an arbitration proceeding.’ ”). In this case, the confidentiality provision in the Employment Dispute Mediation/Arbitration Procedure is broader than what the court in Davis indicated would be conscionable. Cf. id. at 1079 (noting that “[t]he parties to any particular arbitration, especially in an employment dispute, can always agree to limit availability of sensitive employee information (e.g., social security numbers or other personal identifier information) or other issue-specific matters, if necessary”).
While courts- seemingly bound by a recent slew of employer/arbitration-friendly decisions from the Supreme Court- continue to compel arbitration and enforce class and collective action provisions contained in arbitration agreements, this decision seems somewhat in line with the remedial nature of the FLSA and related state wage and hour laws. One way employees and their counsel can try to even the playing field might be to seek court-approved notice of pending litigation, notwithstanding the inability to proceed as a class/collective action. Notifying other employees of existing litigation (and their rights to be paid in accordance with wage and hour laws) would certainly be in line with the remedial purposes of the FLSA and related state wage and hour laws. In any event, the court’s holding that an employer cannot hide its alleged violations for other employees certainly seems to be a step in the right direction.
Click Grabowski v. Robinson to read the entire Opinion.
Guida v. Home Savings of America, Inc.
Plaintiffs brought this putative class action on behalf of themselves, and on behalf of individuals similarly situated, against Defendants, asserting claims under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et. seq., and related New York state wage and labor laws. Defendants moved to dismiss plaintiffs’ complaint, and compel arbitration on an individual basis pursuant to the Federal Arbitration Act (“FAA”), 9 U.S.C. §§ 1 et. seq. While Plaintiffs agreed to arbitrate the dispute, they argued that the arbitrator should decide whether the arbitration can proceed on a class basis, because the arbitration agreement was silent on the issue of class arbitration. The court agreed and held that while the parties were required to arbitrate the dispute, the determination of whether or not the arbitration should proceed on a class basis is for the arbitrator to make in the first instance.
I understand that Home Savings of America makes available arbitration for resolution of employment disputes that are not otherwise resolved by internal policies or procedures.
I agree that if I am unable to resolve any dispute through the internal policies and procedures of Home Savings … I will arbitrate … any legal claim that I might have against Home Savings … or its employees, in connection with my employment or termination of employment … whether arising out of issues or matters occurring before the date of this Agreement or after such date.
I agree to abide by and accept the final decisions of the arbitration panel as ultimate resolution of any disputes or issues for any and all events that arise out of employment or termination of employment.
Although contractual silence [on the issue of arbitration on a class basis] has often been treated by arbitrators as authorizing class arbitration, Stolt–Nielsen suggests a return to the pre-Bazzle line of reasoning on contractual silence, albeit decided by an arbitrator, because it focuses on what the parties agreed to—expressly or by implication.
Id. at *12–13 n. 3. The Third Circuit concluded that the ability of the plaintiffs to proceed on a class basis in arbitration was essentially a question of “what kind of arbitration proceeding the parties agreed to [,]” id. at *10 (emphasis in original) (citing Bazzle), and went on to conclude that “[w]here contractual silence is implicated, the arbitrator and not a court should decide whether a contract was indeed silent on the issue of class arbitration, and whether a contract with an arbitration clause forbids class arbitration.” Id. at *11 (quotation marks omitted) (citing StoltNielsen, 130 S.Ct. at 1771–72, describing the plurality opinion in Bazzle). In Vilches, the agreement in question “did not expressly reference class or collective arbitration or any waiver of the same.” Id. at *3. The parties debated whether a revised arbitration policy including a class arbitration waiver applied to plaintiffs but agreed that plaintiffs’ causes of action alleged in the complaint otherwise fell under the purview of the arbitration agreement. Id. at *3–6, *9–10. The court in Vilches referred the “questions of whether class arbitration was agreed upon to the arbitrator.” Id. This Court similarly concludes that Stolt–Nielsen and Bazzle are reconcilable and that arbitrating on a class basis is a procedural question that is for the arbitrators to decide in accordance with the Supreme Court’s analysis in Stolt–Nielsen, which provides a framework for the arbitrator’s analysis of the issue.
Interestingly, the court also addressed and rejected Defendants’ argument that the Supreme Court’s recent holding in AT & T Mobility LLC v. Concepcion stood for the proposition that the issue of whether or not to arbitrate on a class basis is not a procedural issue, which would have allowed the court to decide the issue.
Click Guida v. Home Savings of America, Inc. to read the entire Memorandum and Order.
This case was before the court on Defendant’s motion to stay the proceedings and compel arbitration on an individual (rather than class/collective) basis. There was no dispute as to whether the Plaintiff had executed the arbitration agreement, containing the class waiver, however the court held that the class waiver was unenforceable, after a lengthy discussion of Second Circuit law and the impact of the recent United States Supreme Court case, Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 130 S.Ct. 1758 (2010).
“Because the Amex decision retains its persuasive force, the Court applies the test adopted in Amex to determine the enforceability of the class waiver provision here at issue. In the totality of the circumstances, the Court finds that the class waiver provision is invalid because it prevents Sutherland from vindicating her statutory rights.
The record supports Sutherland’s argument that her maximum potential recovery would be too meager to justify the expenses required for the individual prosecution of her claim. Sutherland alleges “an actual overtime loss of approximately $1,867.02, with potentially liquidated damages of an equal amount under the FLSA.” (Folkenflik Decl. ¶ 8; see also Sutherland Deck. ¶ 4.) If her only option were to prosecute her claim on an individual basis, Sutherland would be required to pay expenses that would dwarf her potential recovery.
Pursuant to the E & Y Agreement, Sutherland is responsible for the Court Equivalent Fee, or a fee specified by the arbitration provider, whichever is less; arbitration fees and costs are to be shared equally between the parties. (Reece Decl. Exh. D¶ IV.P.) Sutherland has submitted an uncontested affidavit stating that arbitration fees would amount to $24,000, and that the applicable Court Equivalent Fee is $350. (Folkenflik Decl.¶ 24.) E & Y’s offer to pay such costs, which the Court has factored into Sutherland’s expenses as detailed above, thus lessens her burden by $12,350. Although this amount is not insignificant, it is hardly enough to allow Sutherland to bring her claims on an individual basis: she would still be required to spend approximately $200,000 on attorney’s fees and costs, as well as expert fees, in order to recover double her overtime loss of approximately $1,867.02.
E & Y’s attempt to distinguish the cost-recovery differential in Amex from the differential present here is unavailing. The “median plaintiff” in Amex would have recovered damages of $1,751, and the expert’s services would have cost at least several hundred thousand dollars. Amex, 554 F.3d at 317. According to E & Y, a “median plaintiff” in the instant matter could recover “substantially more,” and expert fees here amount to “a small fraction” of those at issue in Amex. (Def. Reply at 6-7.) The Amex decision did not, however, set a cost-to-recovery ratio below which claims are deemed “prosecutable.” The court instead embraced a functional approach, which “depends upon a showing that the size of the recovery received by any individual plaintiff will be too small to justify the expenditure of bringing an individual action.” Amex, 554 F.3d at 320. Sutherland has satisfied her burden on that score.
E & Y also cites to authorities in which the cost-recovery differential was held not to preclude the prosecution of claims on an individual basis. Such decisions are either inapposite or unpersuasive. In Pomposi v. GameStop, Inc., for instance, a class waiver was enforced where the amount in controversy was $11,000, and plaintiff’s total fees and costs ranged from $46,000 to $62,000.09 Civ. 0340, 2010 WL 147196, at *7 (D.Conn. Jan. 11, 2010). The court in Pomposi did not, however, meaningfully discuss plaintiff’s ability to retain counsel notwithstanding the differential between potential costs and recovery. E & Y cites Ornelas v. Sonic-Denver T, Inc., No. 06 Civ. 253, 2007 WL 274738 (D.Colo. Jan. 29, 2007), as standing for the proposition that “compelling arbitration would not preclude plaintiff from pursuing his claims where damages were at least $3500.” (Def. Mem. at 12.) But the plaintiff in Ornelas was allegedly entitled to (i) a trebling of the approximately $3500 in actual damages, and (ii) unspecified punitive damages and interest. Id. at *6. Moreover, the plaintiff in Ornelas apparently would not incur any expert witness fees. Id. at *7. Finally, E & Y offers Anglin v. Tower Loan of Miss., Inc., 635 F.Supp.2d 523 (S.D.Miss.2009) as precedent for “compelling arbitration where damages, attorney’s fees and punitive damages would result in [a] recovery of over $5,000.” (Def. Reply at 12.) The nub of Anglin, however, was that the plaintiff “made no effort” to demonstrate the prohibitive costs of individual arbitration. Anglin, 635 F.Supp.2d at 529. By contrast, Sutherland has “substantial[ly] demonstrat[ed]” that an inability to prosecute her claims on a class basis “would be tantamount to an inability to assert [her] claims at all.” Amex, 554 F.3d at 302-03 n.1.
In light of the foregoing, Sutherland cannot reasonably be expected to retain an attorney to pursue her individual claim, and E & Y has not submitted an affidavit stating otherwise. Sutherland cannot afford to advance the fees and costs in order to hire an attorney on an hourly basis: she has remained unemployed since her termination from E & Y in December 2009; she has no savings, and owes $35,000 in student loans. (Sutherland Decl. ¶ 5.) Counsel for Sutherland will not prosecute her individual claim without charge, and will not advance the required costs where the E & Y Agreement’s fee-shifting provisions present little possibility of being made whole. (Folkenflik Decl. ¶ 25.) As the uncontested affidavit of Sutherland’s counsel reflects, Sutherland would find no attorney willing to represent her under the circumstances. (Id. ¶ 27.) Cf. Kristian, 446 F.3d at 60 (“[I]t would not make economic sense for an individual to retain an attorney to handle one of these cases on an hourly basis and it is hard to see how any lawyer could advise a client to do so.”) (internal quotations omitted).
Sutherland’s only option in pursuing her individual claim is thus to retain an attorney on a contingent fee basis. But just as no rational person would expend hundreds of thousands of dollars to recover a few thousand dollars in damages, “no attorney (regardless of competence) would ever take such a case on a contingent fee basis .” Caban v. J.P. Morgan Chase & Co., 606 F.Supp.2d 1361, 1371 (S.D.Fla.2009); see also Folkenflik Decl.¶ 27. Cf. Kristian, 446 F.3d at 59 (“[I]t would not make economic sense for an attorney to agree to represent any of the plaintiffs in these cases in exchange for 33 1/3% or even a greater percentage of the individual’s recovery.”) (internal quotations omitted). E & Y has submitted no evidence that an attorney would expend approximately $200,000 in time and costs in return for a mere chance to earn potentially one-third of Sutherland’s less than $4,000 recovery.
If Sutherland could aggregate her claim with the claims of others similarly situated, however, she would have no difficulty in obtaining legal representation. (See Folkenflik Decl.¶ 25; see also Pl. Reply at 3.) This is because class proceedings “achieve economies of time, effort, and expense….” Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 616 (1997) (internal quotations omitted).
Enforcement of the class waiver provision in this case would effectively ban all proceedings by Sutherland against E & Y. She will be unable to pursue her claims, even if they are meritorious. As a result, E & Y would enjoy de facto immunity from liability for alleged violations of the labor laws. The legislative purposes in enacting such laws-including, for example, combating “labor conditions detrimental to the maintenance of the minimum standard of living” FLSA § 2(a), 29 U.S.C. § 202(a), and assuring workers “additional pay to compensate them for the burden of a workweek beyond” 40 hours per week, In re Novartis Wage and Hour Litig. Litig. 611 F.3d 141, 150 (2d Cir.2010)-would go unfulfilled. “Corporations should not be permitted to use class action waivers as a means to exculpate themselves from liability for small-value claims.” Dale v. Comcast Corp., 498 F.3d 1216, 1224 (11th Cir.2007).
Having examined the totality of the facts and circumstances, the Court finds that the class waiver provision here at issue is unenforceable because it prevents Sutherland from vindicating her statutory rights. See Amex, 554 F.3d at 302-03 n.1.
It will be interesting to see whether courts in other circuits will follow this well-reasoned opinion. This is an area of FLSA jurisprudence where there is a wide divergence of opinions. The Eleventh Circuit for example has long-held that FLSA Collective Action rights can be waived by agreement.
Click Sutherland v. Ernst & Young LLP to read the entire opinion.


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The production of nanostructures, nanocomposites and modified nanostructures for water remediation will increase because of the need for producing clean water in fast and low energy consumption ways. Nanoparticles are widely used various fields such as electronics, cosmetics, water purification, biomedical, and biotechnology. Nanoparticles can be synthesized by physical methods, chemical and biological methods. Biosynthesis of nanoparticles using biological agents have gained much attention in the area of nanotechnology in last few decades because of cost effective, nontoxic, and ecofriendly. Algae have been used to reduce metal ions and subsequently for the biosynthesis of nanoparticles. The present review is devoted to the possibility of metal nanoparticle synthesis using alga extract. The important advantages of these biological systems are an ecofriendly, economical, high-yielding, expeditious and energy-efficient method. This review is mainly focused on recent progress on the utilization of algae of various classes, for the synthesis of Silver and Gold nanoparticles, their characterization and possible mechanisms.
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matches: V. V. V. V. V. V. V.


Appeal from the Order of the Commonwealth Court at No. 265 MD 2009 dated December 1, 2016.
This is a direct appeal by defendant/appellant Pennsylvania Turnpike Commission ("PTC") from the Commonwealth Court's order entering judgment on a $3.2 million verdict in favor of plaintiff/appellee Ralph M. Bailets ("Bailets") following a non-jury trial of his claims arising under the Whistleblower Law, 43 P.S. §§1421-1428 ("Law"). The verdict included $1.6 million in non-economic damages. PTC presents a question of first impression in Pennsylvania: whether non-economic damages for items such as embarrassment, humiliation, loss of reputation and mental anguish are available to plaintiffs in actions brought under the Law. Additionally, if non-economic damages are authorized under the Law, PTC asks us to determine whether the verdict amount was excessive in this case. We conclude non-economic damages are available to successful plaintiffs under the Law and the trial court did not err or abuse its discretion in entering a verdict amount of $1.6 million. Accordingly, we affirm the judgment.
Bailets was employed by PTC for ten years prior to his termination in November 2008. He was the Manager of Financial Systems and Reporting, responsible for a staff of programmers and business analysts, and it was his duty, among other things, to ensure PTC's financial reports were produced accurately and in a timely fashion. Bailets reviewed submissions in response to requests for proposals PTC issued seeking bids for the creation and implementation of a computerized financial reporting system. He voiced concern to his immediate supervisor, Director of Accounting, Anthony Q. Maun ("Maun"), that one of the bidders for the implementation contract, Ciber, Inc. ("Ciber"), had an unfair advantage over other vendors/bidders, because Ciber had previously been awarded a $3.4 million contract to identify the requirements upon which any implementation would be based. In 2005, despite having submitted the highest bid, Ciber was awarded a $53.8 million implementation contract. Maun told Bailets not to make waves regarding Ciber or his job would be in jeopardy.
After Ciber secured the implementation contract, Bailets voiced numerous complaints to Maun regarding Ciber's poor performance, including high turnover and absenteeism of Ciber consultants, testing failures, and lack of knowledge transfer from Ciber consultants to PTC employees. In 2007, Bailets reported to Maun that senior management should be informed implementation problems were being caused by Ciber's deficient performance, particularly in the area of knowledge transfer, i.e., Ciber consultants failed to deliver information to PTC employees regarding how the computerized financial reporting system actually operated.
Bailets also complained about Ciber's performance to a co-worker, Nikolaus H. Grieshaber ("Grieshaber"). Grieshaber acknowledged Ciber was politically connected within the PTC hierarchy, and warned Bailets to tread lightly in his complaints about Ciber. The problems with implementation of the system continued and by June 2008, the roll-out of the system was three months behind schedule. In June 2008, Grieshaber was promoted to the position of CFO, becoming Maun's immediate superior. Shortly after his promotion, Grieshaber sent an email to PTC's COO, George Hatalowich, stating, among other things, that Grieshaber had "a lot of misgivings about … Bailets[, ]" and that PTC needed to "keep a short leash on him." Trial Ct. Op., 10/6/16 at 9 (citing Trial Ex. 137). In July 2008, Bailets was reassigned to the purchasing department. In August 2008, Ciber was awarded an additional $19.7 million contract to conduct knowledge transfer. Bailets continued to complain to Maun regarding Ciber's deficiencies. On November 20, 2008, PTC's Human Resources Director informed Bailets his position was being eliminated for budgetary reasons. Bailets was directed to immediately pack his personal belongings and was escorted from the building.
Believing he was terminated in retaliation for his reports of wrongdoing and waste, Bailets filed a complaint in the Commonwealth Court's original jurisdiction, alleging a single claim under the Law against PTC. PTC filed a motion for summary judgment claiming Bailets was terminated, along with fourteen other employees, in an organization-wide effort to reduce expenses. In an unreported single-judge opinion, the court held the decision to terminate Bailets was "a management discretionary action, motivated by legitimate employer objectives[, ]" and granted summary judgment in favor of PTC. Bailets v. Pa. Turnpike Comm'n, No. 265 MD 2009, unpublished memorandum at 11 (Pa. Cmwlth. February 4, 2014). Bailets appealed and this Court reversed, reasoning Bailets's complaint clearly presented prima facie evidence of violations of the Law which "at the very least created material issues of fact to preclude the grant of summary judgment[, ]" and remanded to the Commonwealth Court for further proceedings. Bailets v. Pa. Turnpike Comm'n, 123 A.3d 300, 309-10 (Pa. 2015).
A four-day non-jury trial in the Commonwealth Court ensued in May 2016 at which Bailets presented evidence in support of his claim he was fired by PTC due to his reports of waste and wrongdoing. With respect to evidence of economic damages, Bailets presented the expert testimony of economist Andrew Verzilli, who, among other things, testified the accumulation of Bailets's past and future lost earnings resulting from his termination amounted to an "overall loss of $1, 649, 316[.00]." N.T. 5/25/16 at 514. With respect to non-economic damages, Bailets testified the emotional impact of losing his PTC employment was "devastating[, ]" "humiliating[, ]" "painful[, ]" "very demeaning[, ]" and "very difficult emotionally[, ]" which caused him "no end of sleepless nights[.]" N.T. 5/23/16 at 190. Bailets specifically testified to the humiliation he felt because of the way he was fired - "being walked out of your employer with a box in your hand and being escorted out." Id. He further explained it was "certainly humiliating to use an unemployment card at [a] local grocery store" and testified he suffered mental distress contemplating "paying basic bills, repairs on an aging family van, [educational] expenses for my three daughters[, ] . . . retirement savings, medical costs, all of those things, you know, kept me awake many nights and laid heavily on me." Id. at 190-91. Bailets anguished over facing his father-in-law to inform him "I was no longer a provider for his daughter and his grandchildren." Id. at 190. He testified it was painful to tell his thirteen-year-old triplet daughters he no longer had a job and it "broke [his] heart" when one of his daughters later apologized to him "for needing new cleats because she outgrew them." Id. at 194.
Mrs. Ann Bailets testified her husband was terminated shortly before the Thanksgiving holiday and "he was embarrassed and humiliated about facing the members of my family . . . and telling them . . . he no longer had a job." N.T. 5/25/16 at 536. Mrs. Bailets additionally testified her husband initially took a minimum wage job as a driver at an automobile dealership just to have "some income, " and in hopes of making business contacts that might lead to a better employment opportunity. Id. at 537-38. However, he became "frustrated" by his lack of success in securing adequate employment, and "he cried on occasions because he began to wonder if he was ever going to get a job." Id. at 538. Additionally, on a number of occasions he expressed his "guilt[ ] for putting our family through this." Id. Specifically, "he said that . . . maybe he should never have notified his employers of these things that were going wrong[, ]" because if "he hadn't done that, . . . he would still be there." Id. At the same time, she testified he said he "wanted to be able to look in the mirror" and "know that . . . he had done what he thought was the right thing to do." Id.
The trial court concluded Bailets met his burden under the Law of proving he made a good faith report of PTC's wrongdoing and waste and PTC fired him in retaliation for making the report. In determining the issue of damages, the court first noted the Law permits the recovery of "actual damages, " Trial Ct. Op. at 19, quoting 43 P.S. §1425,  and accepted the testimony of Bailets's forensic expert calculating his economic damages at $1.6 million. The court observed "[t]he term actual damages is not defined under the Law, " but noted this Court has "made clear that actual damages include not only economic but non-economic injuries such as 'impairment of reputation and standing in the community, personal humiliation, and mental anguish and suffering.'" Id. at 21, quoting Joseph v. Scranton Times L.P., 129 A.3d 404, 429 (Pa. 2015) (additional citation omitted). The court relied on O'Rourke v. Dep't of Corrections, 778 A.2d 1194 (Pa. 2001), for the proposition the Law is remedial in nature and must be liberally construed. The court reasoned actual damages must include compensation for non-economic damages because O'Rourke emphasized a whistleblower must be put "in no worse a position for having exposed the wrongdoing[.]" Trial Ct. Op. at 22, citing O'Rourke, 778 A.2d at 1202. The court concluded "[w]ithout compensation for harm to his reputation, humiliation and mental anguish, Bailets would be in a far worse position for having reported the wrongdoing." Id. at 23 (footnote omitted). The court also noted other jurisdictions with "similar, if not identical, whistleblower protection laws[, ]" have concluded non-economic damages are recoverable. Id. at 22-23 citing Robertson County v. Wymola, 17 S.W.3d 334, 347 (Tex. Ct. App. 2000) (actual damages under whistleblower law include damages for mental anguish).
In assessing the value of Bailets's non-economic damages, the trial court credited "the testimony of Bailets and his wife" regarding the deep humiliation, anguish and harm to reputation Bailets suffered as a result of his termination. Trial Ct. Op. at 24. The court concluded, "There is no doubt that [PTC's] wrongful termination of Bailets had a profound effect on Bailets and caused a major disruption to his life. Therefore, this court concludes that for his non-economic actual damages, which include harm to his reputation, humiliation, and mental anguish, Bailets is entitled to an award equal to that of his economic damages, or $1.6 million." Id. at 25.


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1. Common questions of law arise for consideration in these appeals which were heard together and shall stand disposed of by this common order. The appeals arise out of two separate judgments delivered by the Designated Court at Surat both dated 4th October, 2008 whereby the Designated Court has while acquitting some of the accused persons convicted the rest and sentenced them to imprisonment for different periods ranging between 10 to 20 years. In Criminal (TADA) case No.41 of 1995 disposed of with Criminal (TADA) case No.1 of 2000 arising out of C.R. No.70 of 1993 relevant to Criminal Appeals No.92 of 2009 and 658 of 2009, the Designated Court has convicted the appellants in those appeals while respondents in Criminal Appeal No.305 of 2009 filed by the State of Gujarat against the very same judgment have been acquitted. In Criminal Appeals No.432-33 of 2009 the State has sought enhancement of the sentence awarded to those convicted by the Trial Court.
2. In Criminal (TADA) case No.59 of 1995 and 2 of 2000 arising out of C.R. No.32 of 1993 the Designated Court has similarly convicted some of the accused persons who are (appellants before us in Criminal Appeals No.110 of 2009 and 659 of 2009). The State has also assailed in the appeals filed by it the judgment of the Trial Court and sought enhancement of the sentence awarded to those convicted by it in Criminal Appeals No.303-304 of 2009.
3. The facts giving rise to the registration of I.C.Rs. No.32 and 70 of 1993 at Varccha and Surat Railway Police Stations in the State of Gujarat respectively leading to the arrest of those accused of committing the offences and their eventual conviction by the Trial Court have been set out at great length by the said Court below in the two judgments and orders impugned before us. We need not, therefore, recapitulate the entire factual backdrop in which the appellants were tried, found guilty and sentenced except to the extent it is absolutely necessary to do so.
Suffice it to say that the two blasts one at Mini Hira Bazar, Varccha Road, Surat and the other at Platform 1, Surat Railway Station took place on 28th January, 1993 and 22nd April, 1993 respectively. In the incident that took place at Mini Hira Bazar, Varccha Road, one minor girl barely 8 years old lost her life while as many as 11 others were injured.
The second incident at the Surat Railway Station relevant to ICR No.70 of 1993 left as many as 38 persons injured, some of them grievously. The prosecution case is that the genesis of the two incidents mentioned above lay in the demolition of the Babri Masjid on 6th December, 1992 at Ayodhaya which had led to wide-spread communal riots in several parts of the country. These riots took place even in the city of Surat causing damage to life and property to the Muslim community. With a view to giving relief to those affected by such riots a Relief Camp at Ranitalao area in the city of Surat was set up mainly by the accused persons including Hussein Ghadially, Iqbal Wadiwala, Mohammad Surti, Hanif Tiger and others. A makeshift office adjacent to the relief camp provided to the accused persons space to hold their meetings.
4. The prosecution alleges that on account of riots and damage suffered by the Muslims, the accused persons nurtured a feeling that the Government and the police will not be able to protect their community. The prosecution's further case is that in order to protect the members of the Muslim community and also to retaliate against the majority community the accused persons initially decided to collect firearms, swords, spears, iron rods, country made bombs and gelatin bombs etc. and to distribute the same to those who had converged in the relief camp. It was also decided to import firearms, bombs etc. from Abdul Latif, a notorious gangster of Ahmedabad who was known to accused No.1 Hussain Ghadially. Abdul Latif was then in Dubai but later arrested and produced before the Designated Court. He was killed in a police encounter during the trial.
5. According to prosecution appellant-Hussein Ghadially and his wife alongwith Iqbal Wadiwala (A-2) went to Ahmedabad in Maruti Van No. GJ 5A 5178 driven by one Bhupat Makwana. In order to carry arms and ammunition including AK 47 rifles, cartridges and bomb etc. a concealed compartment was created in the Maruti Van that was owned by appellant-Iqbal Wadiwala. The arms and ammunition supplied by Abdul Latif (since deceased) were then placed in the secret chamber of the vehicle and transported to Surat. The prosecution alleges that the arms and ammunition to be used were kept at different places for use to wreak vengeance against the majority community. The blasts that took place on 28th January, 1993 at Mini Hira Bazar, Varccha Road, Surat and at Surat Railway Station on 22nd April, 1993 were, according to the prosecution, the culmination of the conspiracy hatched by the accused and the efforts made by them including their active participation in the sordid sequence leading up to grievous injuries to several persons including the killing of an innocent child.
6. The prosecution further alleges that investigation into the crime by the Surat Railway Police did not lead to the apprehension of the real culprits. This forced the Director General of Police of the State of Gujarat to constitute an Action Group for inquiry and investigation into the crime. In the course of investigation by the Action Group, one Mushtaq Patel was apprehended on 12th March, 1995 in connection with a case registered in Umra Police Station under the Arms Act. In the course of interrogation the said Mushtaq Patel revealed information relating to the bomb blast at Platform No.1 at Surat Railway Station. This gave the Action Group a break that led to a series of arrest of persons responsible for the blasts and recovery of arms and ammunition comprising as many as 6 foreign grenades, 2 AK 47 rifles and 199 live cartridges. The arrest of accused persons and the seizure of arms and ammunition in turn led to invocation of provisions of Terrorists and Disruptive Activities (Prevention) Act by orders passed by the Additional Commissioner of Police, G Division, Surat city and/or by the State Government.
7. Confessional statements of the accused persons were after the application of the provisions of the said Act recorded by the Additional Commissioner of Police and separate chargesheet in both FIRs filed before the Designated Court in which accused Yusuf Dadu was shown as absconding. Yusuf Dadu was subsequently apprehended and a supplementary chargesheet in both the cases filed against him which came to be numbered as TADA cases No.1 and 2 of 2000 in relation to the two incidents aforementioned. Before the Designated Court the accused persons pleaded not guilty and claimed a trial.
s. 3(2)(ii) of TADA r/w 120B IPC, 5 of TADA, 307, 326, 325 and 324 r/w 120B IPC, s. 3,4,5 of Explosive Substances Act and 25(1) A of Arms Act.
s. 3(2)(i) of TADA r/w 120B IPC, 5 of TADA, s. 302 r/w 120B IPC, s. 3,4,5 of Explosive Substances Act and 25(1) A of Arms Act.
s. 3(2)(ii) of TADA r/w 120B IPC, 5 of TADA, 307, 326, 325 and 324 r/w 120B IPC, s. 3,4,5 of Explosive Substances Act and 25(1) A & 25(1)AA of Arms Act.
s. 3(2)(i) of TADA r/w 120B IPC, 5 of TADA, s. 302 r/w 120B IPC, s. 3,4,5 of Explosive Substances Act and 25(1) A & 25(1)AA of Arms Act.
s. 3(2)(ii) of TADA r/w 120B IPC, 5 of TADA, 307, 326, 325 and 324 r/w 120B IPC, s. 3(b) of Explosive Substances Act and 25 and 27 of Arms Act.
s. 3(2)(ii) of TADA r/w 120B IPC, 5 of TADA, 307, 326, 325 and 324 r/w 120B IPC, s. 3(b) of Explosive Substances Act and 25 & 27 of Arms Act.
s. 3(2)(i) of TADA r/w 120B IPC, 5 of TADA, s. 302 r/w 120B IPC, s. 3(B) of Explosive Substances Act and 25 & 27 of Arms Act.
s. 3(2)(i) of TADA r/w 120B IPC, 5 of TADA, s. 302 r/w 120B IPC, s. 3(b) & 5 of Explosive Substances Act and 25(1) A of Arms Act.
9. Appearing for the appellants Mr. Sushil Kumar, learned Senior Counsel, strenuously argued that the trial and conviction of the appellants for offences with which they were charged is vitiated for breach of the mandatory provisions of Section 20-A (1) of The Terrorist and Disruptive Activities Act (TADA). That provision it was contended required approval of the District Superintendent of Police for recording of any information about the commission of an offence punishable under the said Act. No such approval was, however, either sought from or granted by the District Superintendent of police concerned. Approval for recording of the information was instead obtained from the Additional Chief Secretary, Home Department, Government of Gujarat who had no power to grant the same under the Act.
So also the purported approval from the Additional Police Commissioner, Surat was of no legal effect as the power to grant such approval vested only in the District Superintendent of Police and could not be exercised by the Additional Commissioner of Police or anyone holding an equivalent rank. The power to grant approval being a sina qua non for recording of any information about the commission of any offence under the Act, absence of such approval was according to Mr. Sushil Kumar sufficient by itself to vitiate any trial that was held in breach of the said provision. Reliance in support of that submission was placed by Mr. Kumar upon several decisions of this Court including one in Aniruddhsinhji Jadeja & Anr. v. State of Gujarat (1995) 5 SCC 302 to which we shall presently turn.
It was contended that the conviction and sentence of the appellants ought to be set aside not only because the provision of Section 20-A (1) is mandatory but also because the power to grant approval for recording of information about the commission of an offence under the Act could be exercised only by the authority concerned under such provision and by nobody else. The designated authority could not, contended Mr. Kumar abdicate the exercise of power in favour of any other authority, no matter such other authority was higher in rank to the designated authority. It was also contended that if the law prescribes a particular procedure for doing a particular thing then any such thing could be done only in the manner prescribed or not at all. Inasmuch as the procedure prescribed by law which required the approval of the competent authority to grant approval for recording the information had not been followed, the trial and conviction of the appellants in breach of a mandatory provision was legally unsustainable.
10. Mr. Yashank Adhyaru, learned Counsel for the State of Gujarat, on the other hand, contended that there was in the present cases no requirement of prior approval for recording information about the commission of offences under TADA inasmuch as the first information reports about the two incidents were registered on 28th January, 1993 and 22nd April, 1993 whereas Section 20-A (1) was inserted in the Act subsequently on 22nd May, 1993. Alternatively it was contended by the learned counsel that the approvals granted by the Government and the Additional Police Commissioner were valid and substantially complied with the requirements prescribed under Section 20-A (1).
11. Before we deal with the contentions urged at the bar we need to sail smooth on the facts relevant to the registration of the two FIRs. The first case relevant to the blast at Mini Hira Bazar, Varaccha Road, led to registration of C.R. No.32 of 1993 not only for commission of offences under the IPC and Explosive Substances Act but also under TADA. Almost one year after the registration of the FIR, on 24th January, 1994 the Police Commissioner, Surat instructed Varaccha Police Station to remove the TADA provision from C.R. No.32 of 1993. These instructions came in the wake of a decision taken by the TADA Review Committee in its meeting held on 24th January, 1994. The instructions were carried out and TADA offences deleted from the two cases in hand. Subsequent to the deletion of TADA from C.R. No.32 of 1993, a request was made by P.C. Pandey Police Commissioner, Surat to the Home Department, Government of Gujarat for re-application of the provisions of TADA.
"In the offence registered at Varacha Police Station, explosion was done by a Russian made grenade which was revealed when accused were arrested in Surat Railway P.St. O. Reg. No.I 60/93. Hence it is required that in Varacha Police Station I O.Reg. No. 32/93 sections of 302, 307, 324, 326, 120(B) of I.P.C. and Sections 3,4,5 of Explosives Substances Act and Sections 3 and 5 of Tada Act are required to be added. Hence sanction to add Sections of Tada may be given.
Additional Chief Secretary, Home Department has given sanction to apply the Sections of Tada.
Section Officer Home Department (Special)"
13. Insofar as the second blast that took place on Platform No.1 Surat Railway Station on 22nd April, 1993 is concerned, C.R. No.70 of 1993 registered in connection therewith was not only under the provisions of the IPC and the Explosives Substances Act but also under Sections 3 and 7 of TADA. The TADA provisions were, however, subsequently removed in this case also pursuant to the decision taken by the Government on the basis of the TADA Review Committee's recommendations and the deletion intimated to the competent Court at Surat. On 12th April, 1995, however, Additional Police Commissioner Range 2, Surat City approved the re-introduction of Sections 3(1), 3 (2), 3(3), 3(4) and 5 of TADA Act to C.R. No.70 of 1993 registered in connection with the said blast. The addition was accordingly made by the investigating officer and intimated to the designated Judge appointed under the TADA.
Section 3(1)(2)(3)(4) and Section 5 of TADA Act have been added in Surat Railway P.St. O.Reg. No. I 70/93 u/sec 307, 326, 324, 427, 120B of IPC and U/sec 3,5,7 of Explosive Substances Act. According to the new provisions of TADA Act, sanction of Additional Police Commissioner Range-2 Surat City has been obtained which is enclosed herewith the case papers. Hence this is to inform you that Sections 3(1)(2)(3)(4) and Section 5 of TADA Act have been added in this offence which please note.
Sanction of Additional Chief Secretary Home Department has been received vide Fax Message No./ V2/ATK/2893/2768 Home Department, Block No.2, Sardar Bhavan, Sachivalaya, Gandhinagar dt. 15.4.95 has been received with the signature of Section Officer Home Department (Special) for application of Sections of TADA Act in Surat Railway Police Station I.O. Reg. No.70/93 registered u/sec 307, 326, 324, 427, 120(B) of IPC and u/sec. 3, 4, 5 of Explosive Substances Act. Sanction letter Fax message is enclosed along with the case papers which please note.
15. It is in the light of the above evident that in C.R.No.32 of 1993 approval for recording of information regarding commission of offences under the TADA came directly from the Home Department of the Government of Gujarat. In C.R. No.70 of 1993 relating to the second blast that took place at Surat Railway Station, the State Government and the Additional Police Commissioner, Surat city approved the application of the provisions of TADA.
Notwithstanding anything contained in the Code, no information about the commission of an offence under this Act shall be recorded by the police without the prior approval of the District Superintendent of Police. No court shall take cognizance of any offence under this Act without the previous sanction of the Inspector-General of Police, or as the case may be, the Commissioner of Police."
17. A careful reading of the above leaves no manner of doubt that the provision starts with a non obstante clause and is couched in negative phraseology. It forbids recording of information about the commission of offences under TADA by the Police without the prior approval of the District Superintendent of Police. The question is whether the power of approval vested in the District Superintendent of Police could be exercised by the Government or the Additional Police Commissioner, Surat in the instant case. Our answer to that question is in the negative. The reasons are not far to seek. We say so firstly because the statute vests the grant approval in an authority specifically designated for the purpose.
That being so, no one except the authority so designated, can exercise that power. Permitting exercise of the power by any other authority whether superior or inferior to the authority designated by the Statute will have the effect of re-writing the provision and defeating the legislature purpose behind the same - a course that is legally impermissible. In Joint Action Committee of Air Line Pilots' Association of India (ALPAI) and Ors. V. Director General of Civil Aviation and Ors. (2011) 5 SCC 435, this Court declared that even senior officials cannot provide any guidelines or direction to the authority under the statute to act in a particular manner.
18. Secondly, because exercise of the power vested in the District Superintendent of Police under Section 20-A (1) would involve application of mind by the officer concerned to the material placed before him on the basis whereof, alone a decision whether or not information regarding commission of an offence under TADA should be recorded can be taken. Exercise of the power granting or refusing approval under Section 20-A (1) in its very nature casts a duty upon the officer concerned to evaluate the information and determine having regard to all attendant circumstances whether or not a case for invoking the provisions of TADA is made out. Exercise of that power by anyone other than the designated authority viz. the District Superintendent of Police would amount to such other authority clutching at the jurisdiction of the designated officer, no matter such officer or authority purporting to exercise that power is superior in rank and position to the officer authorised by law to take the decision.
19. Thirdly, because if the Statute provides for a thing to be done in a particular manner, then it must be done in that manner alone. All other modes or methods of doing that thing must be deemed to have been prohibited. That proposition of law first was stated in Taylor v. Taylor (1876) 1 Ch. D426 and adopted later by the Judicial Committee in Nazir Ahmed v. King Emperor AIR 1936 PC 253 and by this Court in a series of judgments including those in Rao Shiv Bahadur Singh & Anr. v. State of Vindhya Pradesh AIR 1954 SC 322, State of Uttar Pradesh v. Singhara Singh and Ors. AIR 1964 SC 358, Chandra Kishore Jha v. Mahavir Prasad & Ors. 1999 (8) SC 266, Dhananjaya Reddy v. State of Karnataka 2001 (4) SCC 9 and Gujarat Urja Vikas Nigam Ltd. V. Essar Power Ltld. 2008 (4) SCC 755. The principle stated in the above decisions applies to the cases at hand not because there is any specific procedure that is prescribed by the Statute for grant of approval but because if the approval could be granted by anyone in the police hierarchy the provision specifying the authority for grant of such approval might as well not have been enacted.
"11. The case against the appellants originally was registered on 19-3-1995 under the Arms Act. The DSP did not give any prior approval on his own to record any information about the commission of an offence under TADA. On the contrary, he made a report to the Additional Chief Secretary and asked for permission to proceed under TADA. Why? Was it because he was reluctant to exercise jurisdiction vested in him by the provision of Section 20-A(1)? This is a case of power conferred upon one authority being really exercised by another. If a statutory authority has been vested with jurisdiction, he has to exercise it according to its own discretion. If the discretion is exercised under the direction or in compliance with some higher authority's instruction, then it will be a case of failure to exercise discretion altogether. In other words, the discretion vested in the DSP in this case by Section 20-A(1) was not exercised by the DSP at all."
"Closely akin to delegation, and scarcely distinguishable from it in some cases, is any arrangement by which a power conferred upon one authority is in substance exercised by another. The proper authority may share its power with some one else, or may allow some one else to dictate to it by declining to act without their consent or by submitting to their wishes or instructions. The effect then is that the discretion conferred by Parliament is exercised, at least in part, by the wrong authority, and the resulting decision is ultra vires and void. So strict are the courts in applying this principle that they condemn some administrative arrangements which must seem quite natural and proper to those who make them.... Ministers and their departments have several times fallen foul of the same rule, no doubt equally to their surprise..."
"23. Therefore, the law on the question can be summarised to the effect that no higher authority in the hierarchy or an appellate or revisional authority can exercise the power of the statutory authority nor can the superior authority mortgage its wisdom and direct the statutory authority to act in a particular manner. If the appellate or revisional authority takes upon itself the task of the statutory authority and passes an order, it remains unenforceable for the reason that it cannot be termed to be an order passed under the Act."
"18. It is obvious that Section 20-A(1) is a mandatory requirement of law. First, it starts with an overriding clause and, thereafter, to emphasise its mandatory nature, it uses the expression "No" after the overriding clause. Whenever the intent of a statute is mandatory, it is clothed with a negative command. Reference in this connection can be made to G.P. Singh's Principles of Statutory Interpretation, 12th Edn."
24. Relying upon Ahmad Umar Saeed Sheikh v. State of U.P. (1996) 11 SCC 61, this Court has in Ashrafkhan @ Babu Munnekhan Pathan and Anr. v. State of Maharashtra (2012) 11 SCC 606 not only held that the approval given by the Chief Secretary (Home Department) of the State Government was not a sufficient compliance with Section 20-A (1) but also that the difficulty arising out of it was not curable under Section 465 of the Code. This Court observed: "34. ........... Section 465 of the Code, which falls in Chapter 35, covers cases triable by a Court of Session also. Hence, the prosecution can take shelter behind Section 465 of the Code. But Section 465 of the Code shall not be a panacea for all error, omission or irregularity. Omission to grant prior approval for registration of the case under TADA by the Superintendent of Police is not the kind of omission which is covered under Section 465 of the Code. It is a defect which goes to the root of the matter and it is not one of the curable defects."
"37.......... Both operate in different and distinct stages and, therefore, for successful prosecution both the requirements have to be complied with. We have not come across any principle nor are we inclined to lay down that in a case in which different safeguards have been provided at different stages, the adherence to the last safeguard would only be relevant and breach of other safeguards shall have no bearing on the trial. Therefore, we reject the contention of the State that the accused cannot assail their conviction on the ground of absence of approval under Section 20-A(1) of TADA by the Deputy Commissioner, when the Commissioner of Police had granted sanction under Section 20-A(2) of TADA."
26. In two subsequent decisions rendered by this Court in Mohd. Iqbal M. Shaikh & Ors. v. The State of Maharashtra (1998) 4 SCC 494 and Manjit Singh @ Mange CBI, through its SP: (2011) 11 SCC 578 a slightly liberal view has been taken but having regard to the fact that Anirudhsinhji's case (supra) was decided by a three-Judge Bench of this Court, we do not see any compelling reason to depart from the ratio of that decision especially when the view taken in that decision proceeds on sound and well settled legal principles to which we have briefly adverted in the earlier part of this judgment.
27. The upshot of the above discussion, therefore, is that the requirement of a mandatory statutory provision having been violated, the trial and conviction of the petitioners for offences under the TADA must be held to have been vitiated on that account. The argument that the first information report regarding the two incidents had been registered before the introduction of Section 20-A (1) in the statute book making approval of the competent authority unnecessary has not impressed us.
It is true that the two incidents had taken place and cases registered regarding the same under TADA before Section 20-A (1) came on the statute book, but the fact remains that the provisions of TADA were removed from the reports pursuant to the recommendations of the Review Committee. By the time fresh evidence came to light requiring re-introduction of the provisions of the Act approval for recording information regarding commission of offences under TADA, had become necessary. The fact that such approval was considered necessary even by the investigating agency and was prayed for, only shows that the authorities were aware of the requirement of law and had consciously attempted to comply with the said requirement no matter by applying for such approval to an authority not competent to grant the same.
28. Mr. Yashank Adhyaru next argued that even if the provisions of TADA were not available against the appellants the prosecution could still succeed in sustaining the conviction of the appellants under IPC and the Explosive Substances Act. That would indeed be so, provided there is enough evidence on record to support that course of action. When called upon to show evidence that could warrant conviction of the appellants independent of provisions of TADA and the confessional statements of the accused allegedly recorded under the said provisions, Mr. Yashank Adhyaru fairly conceded that while there may be evidence regarding recovery of some of the weapons the same would not by itself be sufficient to justify the conviction of the appellants. Even otherwise the recovery of the weapons is also not satisfactorily proved by cogent and reliable evidence. Such being the position, we have no manner of doubt left that the conviction of the appellants cannot be sustained.
29. We accordingly allow Criminal Appeals No.92 of 2009, 110 of 2009 and 658-659 of 2009 and set aside the orders of conviction passed against the appellants who shall be released from custody forthwith unless required in any other case. Criminal Appeals No.303-304 of 2009, 305 of 2009 and 432- 433 of 2009 filed by the State of Gujarat shall, however, stand dismissed.

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The Director of EOUSA is the official responsible and accountable for the appropriation of the Offices of the United States Attorneys. Each United States Attorney has been delegated authority to manage the funds/budget of his/her office within certain limitations. That delegation is normally administered through the administrative staff of the Office of the United States Attorney.
Financial expenditures should remain consistent with the delegations of each office and within relevant guidelines, regulations, and statutes.
The Anti-Deficiency Act states, inter alia, that the government may not: (1) make or authorize an expenditure exceeding an appropriation; or, (2) involve the government in a contract for money before an appropriation is made, unless authorized by law. 31 U.S.C. § 1341(a). In addition to the plain language of the two preceding prohibitions, this also means that employees may not contract or obligate the United States Attorneys’ appropriation for services to be performed outside of the current fiscal year, absent explicit statutory authority.
Attorneys should be particularly mindful of this restriction if they are contemplating entering into any consent decree. Please ensure that the terms of the consent decree DO NOT obligate the government to expend funds beyond the purpose, time or amount of the office’s available resources. If a USAO needs an exception to this restriction, the Office must consult with and obtain prior approval from EOUSA before executing the agreement.
Advance notification will give EOUSA the ability to review the feasibility and legality of such expenses and an opportunity to consult with Department of Justice officials and Congress to obtain approval.
This restriction does not apply to each United States Attorney’s delegated authority to settle civil cases up to $1,000,000 paid out of the Judgment Fund. See 28 C.F.R. § 0.168.
As part of their employees’ litigative duties, United States Attorneys are authorized to incur the necessary expenses of taking depositions. If a salaried federal court reporter is used, the reporter is entitled to compensation for the production of the transcript only (attendance fees may not be paid). Payment of an attendance fee would be considered a violation of the prohibition against dual compensation. 5 U.S.C. § 5533. The salaried federal reporter is not controlled by the court-reporting law (see 28 U.S.C. § 753 and JM 3-8.420) as to charges for work not regulated by that statute. Payment to stenographers for services should be in accord with prevailing local rates.
Stenographic and notarial charges related to depositions for indigent persons are paid by the Department of Justice only in cases of fact witnesses.
Depositions to be taken in a foreign country must be channeled through the Department of State in the same manner as subpoenaing a witness who resides in a foreign country to appear in court.
The Office of International Affairs (OIA) in the Criminal Division, or the Office of Foreign Litigation (OFL) in the Civil Division, should be consulted in the case of depositions to be taken in the United States at the request of a foreign court.
If foreign witnesses are to be examined on the premises of the diplomatic or consular mission, arrangements should be made in advance with the Special Authorization Unit, JMD, to provide advance authority to the consular official to reimburse these witnesses in the same manner as those appearing in federal courts.
Deposition expenses of experts who will not be government witnesses must be paid as litigative expenses of the USAO.
United States Attorneys have authority to incur expenses to hire foreign counsel. Contact the Resource Management and Planning Staff, EOUSA, for assistance.
Consular officials will normally serve subpoenas on American citizens (including American Nationals who, while not citizens, owe permanent allegiance to the United States, as well as alien residents, who have been lawfully admitted for permanent residence in the United States, although not citizens) residing abroad, except in those countries (such as Switzerland) which prohibit foreigners from serving legal documents. In these cases, the Office of International Affairs (OIA) in the Criminal Division or the Office of Foreign Litigation (OFL) in the Civil Division should be consulted, as appropriate.
American citizens are entitled to compensation for travel and expenses in these cases. When the testimony of the employee of a foreign government is contemplated, it is imperative that the attorney submit a request directly to OIA in the Criminal Division, or the OFL in the Civil Division, prior to communicating with the witness or the foreign government. The appropriate office will request the Department of State to obtain the approval of the foreign government involved.
Payment for subsistence, witness fees, and actual cost of travel, for both American and foreign citizens, is fixed by 28 U.S.C. § 1821.
Pursuant to Federal Rule of Criminal Procedure 15(d), if a deposition was requested by the government, the court may order the government to pay (1) any reasonable travel and subsistence expenses of the defendant and the defendant’s attorney to attend the deposition, and (2) the costs of the deposition transcript. Where the court determines that the defendant is personally unable to bear the deposition expenses, the court must order the government to pay these expenses, regardless of who requested the deposition. Where the USAO is the prosecuting office and the government is directed by the court to pay such costs under Rule 15, the expenses will be considered litigative expenses chargeable against the United States Attorneys’ appropriation. The defendant and his/her counsel will be reimbursed for “reasonable expenses,” i.e., only those expenses for which a government employee traveling under government travel regulations would be reimbursed.
Note. Rule 15 does not specifically address other ancillary costs of a deposition, for example, an attendance fee for the reporter; videography; or payment of a special master appointed under 18 U.S.C. § 3507. Depending on the circumstances, the government may advocate for shared or full payment of such ancillary costs by the defendant (including indigent defendants, whose share would generally be paid pursuant to the Criminal Justice Act).
The Court Interpreters Act of 1978 requires the Director of the Administrative Office of the U.S. Courts (AOUSC), to “establish a program to facilitate the use of interpreters in courts of the United States.” The AOUSC will prescribe standards for interpreter qualifications and will certify the qualifications of individuals who may serve as interpreters in bilingual proceedings and in proceedings involving persons whose hearing is impaired.
All costs for interpreter services necessary to enable a party to comprehend the proceedings in the courtroom or in chambers, to communicate with counsel in the immediate environs of the courtroom in connection with ongoing judicial proceedings and to communicate with the presiding judicial officer are payable from funds appropriated to the judiciary. Interpreter services required by a criminal defendant to whom the government furnishes representation under the Criminal Justice Act are payable from funds appropriated to support that Act.
The USAO is generally chargeable only for interpreter services necessary to interpret the testimony of prospective government witnesses in the investigative stage. When the case goes to trial, those trial-related interpretive expenses can be funded under an expert witness agreement using resources from the Fees and Expenses of Witnesses (FEW) appropriation. Although testimony situations are the most common occasion for the use of interpreters, interpreters may also be engaged for services necessary to determine the course of litigation. They may be paid for, or provided, transportation, facilities, equipment or materials as necessary and appropriate to satisfy the United States Attorney’s requirements.
Interpreters are required to execute a written oath as prescribed by the AOUSC. The rate of compensation should be fixed by agreement with the interpreter before the interpreter renders the service required by the United States Attorney. Rates of compensation should correspond to rates paid by the court. The AOUSC regulation (Sec. 1.72) currently permits the presiding judicial officer to fix reasonable compensation according to the prevailing rates at the location where the designated interpreter regularly works.
It is the responsibility of investigative agencies to pay the costs to translate and transcribe recordings of foreign language telephone conversations obtained under authority of Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. §§ 2510 to 2520.
Federal judges are allowed to appoint expert witnesses to assist the court in the performance of its duty on a particular case or proceeding under Fed.R.Evid. 706. The court may either appoint an expert of its own choosing or one agreed upon by both parties. The expert’s deposition may be taken by any party and he/she may be called to testify by the court or any party.
Criminal Proceedings and Civil Condemnation Proceedings. The compensation of expert witnesses appointed by the Court under Fed.R.Evid. 706 is treated as a litigative expense chargeable to the litigating agency of the government. 58 COMP.GEN. § 259 (1979). In those instances where the Department is the litigating agency, the expenses of the court- appointed expert witness are payable from the FEW appropriation.
Civil Proceedings. Fed.R.Evid. 706 provides that in other civil actions, the compensation of court-appointed experts shall be paid by the parties in such proportions and at such times as the court directs. Any compensation charged to the Department will be paid from the FEW appropriation.
Authorization and Payment Procedures. When the expert is appointed by the court and the United States is ordered to pay expenses, the United States Attorney should enter into an expert witness agreement with the expert and attach a copy of the court order appointing the expert witness under Fed.R.Evid. 706.
Exclusion Under Fed.R.Evid. 706. The appointment of expert witnesses for an indigent defendant in criminal cases or in civil habeas corpus cases is not provided under Fed.R.Evid. 706. In such instances, the Criminal Justice Act authorizes the court-appointed defense attorney to hire an expert witness on behalf of the indigent defendant. The expenses of the expert will be paid by the AOUSC from funds appropriated for the implementation of the Criminal Justice Act.
The Department pays for the compensation of special masters or appraisers consistent with the fees and expenses set by the court, but it reserves the right to refuse payment of unusual or unreasonable fees and/or expenses.
United States Attorneys may authorize payment of reasonable compensation for special masters, guardians ad litem, or appraisers appointed by the court as the result of an action brought by the United States. Vouchers for compensation and expenses of such individuals must be supported by copies of the order making the appointment and fixing compensation and expenses. Funding must come from the USAO’s litigation budget, not from the FEW appropriation. The attorney should make a note on the applicable form when it is being used for a special master, guardian ad litem, or appraiser.
Fees and expenses of land commissioners will not be paid by the Department. Land commissioners appointed pursuant to Rule 71A, Federal Rules of Civil Procedure, are payable from funds appropriated to the judiciary.
As provided in 28 U.S.C. § 753, each district court shall appoint one or more salaried court reporters who shall attend each session and record verbatim all proceedings in open court, and all other proceedings as specified by statute, rule, order of the court, or as requested by any party to the proceedings. EOUSA’s interpretation of the statute requires that every word in criminal proceedings be recorded, including closing arguments. It is suggested that, in districts where it is not the practice to record proceedings in full, application should be made to the court to take corrective measures insuring compliance with the statute.
The salaried reporter is entitled to receive, in addition to salary, such fees for transcripts as may be prescribed from time to time by the court with the approval of the Judicial Conference. These fees are collectible from the parties, including the United States. The Department of Justice is not financially responsible for any part of a transcript furnished to: the court; opponent counsel; to persons proceeding in forma pauperis; nor for the reporter’s travel expenses except that, on approval of the court, the cost of the original and copies may be apportioned among the persons to whom they are furnished. If the government requires daily transcripts, any additional expenses involved in providing more rapid delivery must be borne by the reporter. The only exception to this is in rural areas, where the court reporter may need to hire reporters from outside the community area to help produce hourly, daily, or expedited transcripts. In such instances, the reporter may bill the ordering party for the subsistence costs of other reporters or auxiliary personnel. The costs are authorized up to the amount of travel subsistence that a government employee may be reimbursed for the same travel. An attendance fee for auxiliary personnel is not billable to the ordering party.
The Department’s appropriations are not available for payment of court reporters’ fees for recording court proceedings. If the salaried reporter is unable to report on court proceedings, the matter of obtaining additional reporters is a consideration for the court.
In view of the difficulty of obtaining the services of a salaried court reporter in Lands Commissioner cases, and because Department appropriations may not be used for additional reporters, the Director of AOUSC has advised that, in special cases when the salaried court reporter is unavailable to report these hearings, it will authorize the appointment of a temporary court reporter for that purpose. In such cases, the United States Attorney should request that the judge secure authority for appointment from AOUSC.
Grand jury reporting may be performed by an employee of the USAO (Fed.R.Crim.P.Rule 6(d)) or by a commercial reporter engaged for the purpose. The salaried federal court reporter may report grand jury proceedings, but he/she may only be paid for transcripts produced, not for time worked. Payment to a salaried federal court reporter for time worked would be considered a violation of the statutory prohibition against dual compensation. 5 U.S.C. § 5533.
Following is a listing of expenses which may be incurred for persons proceeding in forma pauperis, and the responsibility for such expenses.
Fact Witnesses. Costs relating to subpoenas and fees of indigent defendants’ witnesses are the responsibility of the Department and payable at the rates prescribed for witnesses pursuant to 28 U.S.C. § 1821.
Expert Witnesses. Expert witnesses called by the defense and necessary to the adequate defense of an indigent person are paid from funds appropriated for the implementation of the Criminal Justice Act by the AOUSC. These expenses are authorized on Form CJA-21 after certification by counsel for the indigent defendant and approval by the presiding court or magistrate. Experts called by the court on behalf of the indigent person are paid by the AOUSC. The Department will pay for expert witness fees and expenses for expert witnesses appearing on behalf of the government. United States Attorneys have authority to employ an expert witness appearing on behalf of the government.
Mental Examinations for Indigent Persons. Expenses for examinations under 18 U.S.C. § 4241 to determine a defendant's mental competency to stand trial are always the responsibility of the Department. Expenses for examinations to determine a defendant's mental responsibility at the time of the alleged offense are paid by the AOUSC, except when the request is made by the United States, in which case the Department is responsible. See OBD Order 2110.20B (February 2001).
Depositions. Expenses for travel and subsistence of a defendant and defendant’s counsel for attendance at a deposition taken pursuant to Rule 15(c) of the Federal Rules of Criminal Procedure are payable by the prosecuting agency. The purpose of such a deposition is to preserve evidence for the prosecution, and all costs should be assigned to the prosecuting agency regardless of the availability of funds appropriated for the Criminal Justice Act. (Decision of Administration Counsel, Department of Justice, November 26, 1975.) The United States Attorney may authorize such expenses in a similar fashion as other litigation expenses.
Fees and expenses for depositions of fact witnesses, including the cost of recording and transcribing the proceeding, for indigent persons shall be paid by the Department in the same manner as expenses and fees for fact witnesses testifying in court. See above. Fees and expenses for depositions of expert witnesses of the indigent defendant are paid by the AOUSC. 39 COMP.GEN. 133.
Litigative expenses are “those which result directly from actions of the courts or have a direct connection with the prosecution of a case.” Such costs arise from court reporting, filing, fees, interpreters, consultants, advertising legal notices, transportation of evidence, special masters, and advisory reports from experts who will not serve as witnesses (e.g., appraisals). United States Attorneys may incur litigative expenses without specific authorization from EOUSA. Administrative expenses which the United States Attorneys may approve include the purchase of supplies, books, subscriptions, furniture, and equipment, as well as expenses relating to employee travel, overtime, and utility services, among other things. However, there are various limitations and other criteria that must be considered for legal and administrative expenses, including dollar limitations for purchases made using certified invoice procedures and for purchases made under other delegations of procurement authority. Lack of sufficient procurement authority in USAOs may require the involvement of EOUSA to place orders and make purchases. Moreover, as discussed in various sections of the JM and in other guidance, certain expenses require prior authorization from EOUSA, including United States Attorney travel outside of the United States Attorney’s federal judicial district (except for travel processed using local travel procedures), actual lodging expenses, premium class travel expenses, and food and entertainment expenses, among other things.
In 38 COMP. GEN. 343, the Comptroller General ruled that when Congress has specifically authorized a particular government agency or corporation to undertake litigation in the pursuance of its duties and responsibilities, i.e., the agency can “sue or be sued”, the out-of-pocket expenses incurred in prosecuting or defending such actions will be properly chargeable to the appropriations of that agency or corporation, even though the Department may prosecute or defend any litigation in which the agency or corporation becomes involved.
Further, those government agencies that lack Congressional authorization to institute suit or defend against legal actions (e.g., Farmers Home Administration) are also prohibited by the Comptroller General from using their appropriation to pay for litigative services. These agencies must rely upon the Department to act in their behalf and, as a result, all out-of-pocket expenses relating to the litigation are properly chargeable to the United States Attorneys’ appropriation as litigative expenses.
Out-of-pocket expenses are generally defined as those expenses incurred by agencies or organizations other than the United States Attorneys for services provided by a private vendor (i.e., persons or firms outside the federal government) which are directly related to conducting the litigation at hand.
In assisting in foreclosure proceedings, the U.S. Marshals Service incurs various out-of-pocket expenses associated with the proceedings. Out-of-pocket expenses are defined as those costs incurred for advertising, property appraisals, abstract supplementation and any other services provided by private vendors which are directly related to conducting the foreclosure proceedings. Intrinsic expenses such as U.S. Marshals’ fees, commissions, mileage, per diem, salaries, etc., are assumed by the U.S. Marshals Service to be constructive earnings and are not expenses that are chargeable to the United States Attorneys’ appropriation.
The U.S. Marshals Service will be reimbursed for its out-of-pocket expenses incurred in foreclosure proceedings in either one of two ways. First, when a third (i.e., non-government) party is the successful bidder for the mortgaged property at the foreclosure sale, the bid is paid into the court and a fund is created. The U.S. Marshals Service is reimbursed from this fund for all appropriate expenses incurred before funding is then disbursed to the first lien creditor, then to other creditors in order of priority or to the court for distribution as the court may direct. The United States Attorneys’ appropriation may not be billed by the U.S. Marshals for out-of-pocket expenses incurred in a third-party sale. If the USAO in the district in which the litigation occurred had inadvertently been billed and paid for any of the out-of-pocket expenses associated with the litigation, the United States Attorney should seek reimbursement for payments from the U.S. Marshals Service.
U.S. Marshals Service should submit an itemized voucher for appropriate out-of-pocket expenses incurred in a foreclosure proceeding to the United States Attorney in the district responsible for handling the litigation. The United States Attorney must sign the voucher and certify that the charges billed are appropriate for payment.
In accordance with 31 U.S.C. § 3324, prohibiting advance payments of public monies, no disposition of funds should be made for services rendered, purchases made, etc., until the transaction has been accomplished. An exception to this rule is permitted if advance payment is authorized by “other law.” This provision has been interpreted to include state law. Therefore, if state law requires the advance payment of filing fees, for instance, such payments may be issued upon appropriate showing of the requirement of law. A voucher prepared for issuance of an advance payment should specifically identify the statute requiring payment in advance.
The appropriation, “Salaries and Expenses, United States Attorneys, Department of Justice,” is chargeable with the expense of operating the USAOs.
The date on which fees are earned, services rendered, orders are placed, or expenses incurred, and not the date of certification of payment, determine the fiscal year from which payment shall be made, except that bills for metered commodities or services such as electricity, telephone, etc., shall be paid from the appropriation current at the end of the billing period.
Foreign counsel in extradition cases.
Expenses authorized on behalf of indigent defendants.
Travel is governed by the Federal Travel Regulation (FTR), as supplemented by Department of Justice Order 2200.11(I) and Department of Justice Policy Statement 1400.04, Temporary Duty Travel.