§ 88-1 Filing of inventory and sale license required.
§ 88-2 Application for license; license period.
§ 88-4 Issuance of sale license; fee.
§ 88-5 Display of sale license and number.
§ 88-6 Merchandise which may not be sold; records.
§ 88-7 Investigations by Town Clerk.
§ 88-8 Unlawful advertising prohibited.
§ 88-10 Compliance with other laws.
Editor's Note: Former Ch. 88, Economic Development Zone, Art. I, Zone Establishment, adopted 2-23-1994 by L.L. No. 4-1994, was repealed 4-23-2003 by L.L. No. 4-2003. Former Art. II, Tax Exemption, adopted 12-14-1994 by L.L. No. 23-1994, was repealed 2-19-2003 by L.L. No. 2-2003.
It shall be unlawful for any person to advertise or conduct any sale of goods, wares or merchandise, at retail or at auction, which is represented to be a "bankrupt," "insolvent," "assignee," "adjuster's," "trustee's," "executor's," "administrator's," "receiver's," "wholesaler's," "jobber's," "manufacturer's closing out," "liquidation," "closing stock," "smoke, fire or water damage sale" or any other sale which is by representation or advertisement intended to lead the public to believe that the person conducting the sale is selling out or closing out the goods, wares or merchandise of any business for less than the current or going retail price thereof, in the Town, without first filing with the Town Clerk an inventory as prescribed in this chapter and obtaining from the Town Clerk a license for such sale, which shall be known as a "sale license." A sale license shall be issued only to the real party or parties in interest, as owner.
Any person desiring to obtain a sale license required by this chapter shall make application therefor to the Town Clerk, with an inventory in duplicate. The application shall be in writing and under oath and shall disclose the type or character of the proposed sale, the place and manner of conducting the sale, the name of the person owning the goods, wares and merchandise to be sold, and all details necessary to identify fully the goods, wares and merchandise which are the subject of the proposed sale.
The application for a sale license required by this chapter shall also specify the dates on which the proposed sale is to begin and to terminate, which period shall not exceed 45 consecutive days; however, if it shall be made to appear upon sworn application to the Town Clerk at any time during the forty-five-day period that all of the goods, wares and merchandise described and inventoried in the original application have not been sold, the Town Clerk may grant a supplemental license extending such sale for an additional period of 45 consecutive days.
The inventory required by this chapter shall contain a complete and accurate list of the stock of goods, wares and merchandise to be sold at any sale for which a license is required by this chapter, together with the wholesale price thereof and the name or names of the real party or parties in interest. The inventory or list shall be signed by the person seeking the license or by his authorized resident agent, and such person or agent shall swear or affirm that the information contained therein is full and correct.
If the Town Clerk shall be satisfied from the application for a sale license required by this chapter that the applicant intends to conduct a bona fide sale of the type and character described in the application, the Town Clerk shall approve the application and, upon the payment to the Town of a fee in the sum of $500, shall issue the license to the applicant, authorizing him to advertise and conduct a sale of the specific kind for which he has applied, subject to the provisions and requirements of this chapter. The fee for a renewal of a sale license, if granted by the Town Clerk, shall be an additional fee.
A sale license issued by the Town Clerk pursuant to this chapter shall, at all times during the period of the sale, be posted conspicuously on the licensed premises where the sale is to be conducted, and the designated license number shall be specifically stated in any advertisements connected with the sale.
It shall be unlawful to sell, offer or expose for sale at any sale subject to this chapter, any goods, wares or merchandise which is not the regular stock of the store, the business or which is to be closed out by such sale, or to make any replenishments or additions to such stock, for the purpose of the sale or during the continuance thereof, or to fail, neglect or refuse to keep accurate records of the articles or things sold, from which records the Town Clerk may ascertain the kind and quantity of the articles sold pursuant to a sale license.
The Town Clerk may, in his discretion, verify the details of any inventory filed for the purpose of obtaining a sale license pursuant to this chapter, or he may check and verify the items of merchandise sold during the sale, and it shall be unlawful for any person to whom a sale license has been issued to fail or refuse to give the Town Clerk, or any person designated by him for that purpose, all the facts connected with the stock on hand or the proper information of goods sold or any other information that he may require in order to make a thorough investigation of all facts connected with the sale.
It shall be unlawful, in connection with a sale subject to this chapter, to employ any untrue, deceptive or misleading advertising.
The provision of this article shall not be applicable to trustees in bankruptcy, executors, administrators, receivers, as such, or officers acting under judicial process, nor to a sale conducted by a going concern as a reduction-of-merchandise sale, a seasonal sale or to a special offering of merchandise.
The going-out-of-business sale under the provision of this chapter shall be conducted in a manner consistent with the local laws of the Town of Poughkeepsie, including but not limited to the Zoning Law and shall be at all times conducted in a manner that protects the public health, safety and welfare, and a failure to conduct said sale in accordance with the terms of the Town's local laws or in a manner that is not consistent with the public's health, safety and welfare shall constitute a violation of this chapter and the penalty shall be $1,000 for each violation, and each day shall constitute a separate violation.
Failure to conduct said sale in accordance with the terms of the Town's local laws, including but not limited to this chapter, or in a manner that is not consistent with the public health, safety and welfare shall constitute a violation of this chapter, and a failure to comply with the terms and conditions of this chapter shall constitute a violation, the penalty for which shall be $1,000 for each violation, and each day shall constitute a separate violation, or by imprisonment for a term not to exceed 30 days, or by both such fine and imprisonment, and the conviction may result in addition to the imposition of fines and penalties prescribed in the revocation of the offender's sale license.


This case illustrates that tragic facts make bad law. The Court holds that a state tort jury, rather than the Food and Drug Administration (FDA), is ultimately responsible for regulating warning labels for prescription drugs. That result cannot be reconciled with Geier v. American Honda Motor Co., 529 U. S. 861 (2000) , or general principles of conflict pre-emption. I respectfully dissent.
Federal law, however, does rely on the FDA to make safety determinations like the one it made here. The FDA has long known about the risks associated with IV push in general and its use to administer Phenergan in particular. Whether wisely or not, the FDA has concluded—over the course of extensive, 54-year-long regulatory proceedings—that the drug is “safe” and “effective” when used in accordance with its FDA-mandated labeling. The unfortunate fact that respondent’s healthcare providers ignored Phenergan’s labeling may make this an ideal medical-malpractice case.3 But turning a common-law tort suit into a “frontal assault” on the FDA’s regulatory regime for drug labeling upsets the well-settled meaning of the Supremacy Clause and our conflict pre-emption jurisprudence. Brief for United States as Amicus Curiae 21.
Thus, a drug’s warning label “serves as the standard under which the FDA determines whether a product is safe and effective.” 50Fed. Reg. 7470 (1985). Labeling is “[t]he centerpiece of risk management,” as it “communicates to health care practitioners the agency’s formal, authoritative conclusions regarding the conditions under which the product can be used safely and effectively.” 71Fed. Reg. 3934 (2006). The FDA has underscored the importance it places on drug labels by promulgating comprehensive regulations—spanning an entire part of the Code of Federal Regulations, see 21 CFR pt. 201, with seven subparts and 70 separate sections—that set forth drug manufacturers’ labeling obligations. Under those regulations, the FDA must be satisfied that a drug’s warning label contains, among other things, “a summary of the essential scientific information needed for the safe and effective use of the drug,” §201.56(1), including a description of “clinically significant adverse reactions,” “other potential safety hazards,” “limitations in use imposed by them, … and steps that should be taken if they occur,” §201.57(c)(6)(i). Neither the FDCA nor its implementing regulations suggest that juries may second-guess the FDA’s labeling decisions.
Notwithstanding the statute’s saving clause, and notwithstanding the fact that Congress gave the Secretary authority to set only “minimum” safety standards, we held Geier’s state tort suit pre-empted. In reaching that result, we relied heavily on the view of the Secretary of Transportation—expressed in an amicus brief—that Standard 208 “ ‘embodies the Secretary’s policy judgment that safety would best be promoted if manufacturers installed alternative protection systems in their fleets rather than one particular system in every car.’ ” 529 U. S., at 881 (quoting Brief for United States as Amicus Curiae,O. T. 1999, No. 98–1811, p. 25). Because the Secretary determined that a menu of alternative technologies was “safe,” the doctrine of conflict pre-emption barred Geier’s efforts to deem some of those federally approved alternatives “unsafe” under state tort law.
The same rationale applies here. Through Phenergan’s label, the FDA offered medical professionals a menu of federally approved, “safe” and “effective” alternatives—including IV push—for administering the drug. Through a state tort suit, respondent attempted to deem IV push “unsafe” and “ineffective.” To be sure, federal law does not prohibit Wyeth from contraindicating IV push, just as federal law did not prohibit Honda from installing airbags in all its cars. But just as we held that States may not compel the latter, so, too, are States precluded from compelling the former. See also Fidelity Fed. Sav. & Loan Assn. v. De la Cuesta, 458 U. S. 141, 155 (1982) (“The conflict does not evaporate because the [agency’s] regulation simply permits, but does not compel,” the action forbidden by state law). If anything, a finding of pre-emption is even more appropriate here because the FDCA—unlike the National Traffic and Motor Safety Vehicle Act—contains no evidence that Congress intended the FDA to set only “minimum standards,” and the FDCA does not contain a saving clause.4 See also ante, at 18 (conceding Congress’ “silence” on the issue).
When respondent was injured in 2000, Phenergan’s label specifically addressed IV push in several passages (sometimes in lieu of and sometimes in addition to those discussed above). For example, the label warned of the risks of intra-arterial injection associated with “aspiration,” which is a technique used only in conjunction with IV push.12 The label also cautioned against the use of “syringes with rigid plungers,” App. 390, which are used onlyto administer the drug via IV push. As respondent’s medical expert testified at trial, “by talking plungers and rigid needles, that’s the way you do it, to push it with the plunger.” Id., at 53 (testimony of Dr. John Matthew). Moreover, Phenergan’s 2000 label devoted almost a full page to discussing the “Tubex system,” see id., at 391, which, as noted above, is used only to administer the drug via IV push.
As noted above, when the FDA approved Phenergan’s label, it was textbook medical knowledge that the “antecubital fossa” creates a high risk of inadvertent intra-arterial injection, given the close proximity of veins and arteries. See supra, at 13–14; see also The Lippincott Manual of Nursing Practice 99 (7th ed. 2001) (noting, in a red-text “NURSING ALERT,” that the antecubital fossa is “not recommended” for administering dangerous drugs, “due to the potential for extravasation”).13 According to the physician’s assistant who injured respondent, however, “[i]t never crossed my mind” that an antecubital injection of Phenergan could hit an artery. App. 110; see also ibid. (“[It] just wasn’t something that I was aware of at the time”). Oblivious to the risks emphasized in Phenergan’s warnings, the physician’s assistant pushed a double dose of the drug into an antecubital artery over the course of “[p]robably about three to four minutes,” id., at 111; id., at 105, notwithstanding respondent’s complaints of a “ ‘burn[ing]’ ” sensation that she subsequently described as “ ‘one of the most extreme pains that I’ve ever felt,’ ” id., at 110, 180–181. And when asked why she ignored Phenergan’s label and failed to stop pushing the drug after respondent complained of burning pains, the physician’s assistant explained that it would have been “just crazy” to “worr[y] about an [intra-arterial] injection” under the circumstances, id., at 111.
Second, the Court today distinguishes Geier because the FDA articulated its pre-emptive intent “without offering States or other interested parties notice or opportunity for comment.” Ante, at 21; see also ante, at 24. But the Geier Court specifically rejected the argument (again made by the dissenters in that case) that conflict pre-emption is appropriate only where the agency expresses its pre-emptive intent through notice-and-comment rulemaking. Compare 529 U. S., at 885 (“To insist on a specific expression of agency intent to pre-empt, made after notice-and-comment rulemaking, would be in certain cases to tolerate conflicts that an agency, and therefore Congress, is most unlikely to have intended. The dissent, as we have said, apparently welcomes that result … . We do not”), with id., at 908–910 (Stevens, J., dissenting) (emphasizing that “we generally expect an administrative regulation to declare any intention to pre-empt state law with some specificity,” and that “[t]his expectation … serves to ensurethat States will be able to have a dialog with agencies regarding pre-emption decisions ex ante through the normal notice-and-comment procedures of the Administrative Procedure Act” (internal quotation marks omitted)). Indeed, pre-emption is arguably more appropriate here than in Geier because the FDA (unlike the DOT) declared its pre-emptive intent in the Federal Register. See 71 Fed. Reg. 3933–3936. Yet the majority dismisses the FDA’s published preamble as “inherently suspect,” ante, at 21, and an afterthought that is entitled to “no weight,” ante, at 25. Compare Lohr, supra, at 506 (opinion of Breyer, J.) (emphasizing that the FDA has a “special understanding of the likely impact of both state and federal requirements, as well as an understanding of whether (or the extent to which) state requirements may interfere with federal objectives,” and that “[t]he FDA can translate these understandings into particularized pre-emptive intentions … through statements in ‘regulations, pre-ambles, interpretive statements, and responses tocomments’ ”).
Third, the Court distinguishes Geier because the DOT’s regulation “bear[s] the force of law,” whereas the FDA’s preamble does not. Ante, at 24; see also ante, at 19. But it is irrelevant that the FDA’s preamble does not “bear the force of law” because the FDA’s labeling decisions surely do. See 21 U. S. C. §355. It is well within the FDA’s discretion to make its labeling decisions through administrative adjudications rather than through less-formal and less-flexible rulemaking proceedings, see SEC v. Chenery Corp., 332 U. S. 194 (1947) , and we have never previously held that our pre-emption analysis turns on the agency’s choice of the latter over the former. Moreover, it cannot be said that Geier’s outcome hinged on the agency’s choice to promulgate a rule. See ante, at 19, 24. The Geier Court relied—again over the dissenters’ protestations—on materials other than the Secretary’s regulation to explain the conflict between state and federal law. Compare 529 U. S., at 881, with id., at 899–900 (Stevens, J., dissenting), and ante, at 1–2 (Breyer, J., concurring).
The problem is well illustrated by the labels borne by “vesicant” drugs, many of which are used for chemotherapy. As a class, vesicants are much more dangerous than drugs like Phenergan,15 but the vast majority of vesicant labels—like Phenergan’s—either allow or do not disallow IV push. See Appendix, infra. Because vesicant extravasation can have devastating consequences, and because the potentially lifesaving benefits of these drugs offer hollow solace to the victim of such a tragedy, a jury’s cost-benefit analysis in a particular case may well differ from the FDA’s.
1 Indeed, respondent conceded below that Wyeth did propose an adequate warning of Phenergan’s risks. See Plaintiff Diana Levine’s Memorandum in Opposition to Wyeth’s Motion for Summary Judgment in Levine v. American Home Products Corp. (now Wyeth), No. 670–12–01 Wncv (Super. Ct. Washington Cty., Vt.), ¶7, p. 26. Specifically, respondent noted: “In 1988, Wyeth proposed language that would have prevented this accident by requiring a running IV and explaining why a running IV will address and reduce the risk [of intra-arterial injection].” Ibid. See also id., at 24 (“Although not strong enough, this improved the labeling instruction, if followed, would have prevented the inadvertent administration of Phenergan into an artery …”). The FDA rejected Wyeth’s proposal. See App. 359.
2 Moreover, in the trial judge’s final charge, he told the jury that “the critical factual issue which you must decide” is whether Phenergan’s FDA-mandated label reflects a proper balance between “the risks and benefits of intravenous administration and the potential for injury to patients.” Id., at 220. See also ___ Vt. ___, ___, 944 A. 2d 179, 182 (2006) (recognizing that respondent’s argument is that Phenergan’s “label should not have allowed IV push as a means of administration”).
3 Respondent sued her physician, physician’s assistant, and hospital for malpractice. After the parties settled that suit for an undisclosed sum, respondent’s physician sent her a letter in which he admitted “responsibility” for her injury and expressed his “profoun[d] regre[t]” and “remors[e]” for his actions. 1 Tr. 178–179 (Mar. 8, 2004) (testimony of Dr. John Matthew); see also App. 102–103 (testimony of physician’s assistant Jessica Fisch) (noting that her “sense of grief” was so “great” that she “would have gladly cut off [her own] arm” and given it to respondent). Thereafter, both the physician and the physician’s assistant agreed to testify on respondent’s behalf in her suit against Wyeth.
4 To be sure, Congress recognized the principles of conflict pre-emption in the FDCA. See Drug Amendments of 1962, §202, 76 Stat. 793 (“Nothing in the amendments made by this Act to the Federal Food, Drug, and Cosmetic Act shall be construed as invalidating any provision of State law … unless there is a direct and positive conflict between such amendments and such provision of State law”). But a provision that simply recognizes the background principles of conflict pre-emption is not a traditional “saving clause,” and even if it were, it would not displace our conflict-pre-emption analysis. See Geier v. American Honda Motor Co., 529 U. S. 861, 869 (2000) (“[T]he saving clause … does not bar the ordinary working of conflict pre-emption principles”); id., at 873–874 (“The Court has … refused to read general ‘saving’ provisions to tolerate actual conflict both in cases involving impossibility and in ‘frustration-of-purpose’ cases” (emphasis deleted and citation omitted)).
5 The FDA cited numerous articles that generally discuss the costs and benefits associated with IV push. See, e.g., Nahrwold & Phelps, Inadvertent Intra-Arterial Injection of Mephenteramine, 70 Rocky Mountain Medical J. 38 (Sept. 1973) (cited in App. 314, no. 14); Albo, Cheung, Ruth, Snyder, & Beemtsma, Effect of Intra-Arterial Injections of Barbituates, 120 Am. J. of Surgery 676 (1970) (cited in App. 314, no. 12); Corser, Masey, Jacob, Kernoff, & Browne, Ischaemia Following Self-administered Intra-arterial Injection of Methylphenidate and Diamorphine, 40 Anesthesiology 51 (1985) (cited in App. 314, no. 9); Correspondence Regarding Thiopental and Thiamylal (3 letters), 59 Anesthesiology 153 (1983) (cited in App. 314, no. 11); Miller, Arthur, & Stratigos, Intra-arterial Injection of a Barbituate, 23 Anesthesia Progress 25 (1976) (cited in App. 315, no. 19).
6 See Webb & Lampert, Accidental Arterial Injections, 101 Am. J. Obstetrics & Gynecology 365 (1968) (cited in App. 313, no. 5).
7 See Hager & Wilson, Gangrene of the Hand Following Intra-arterial Injection, 94 Archives of Surgery 86 (1967) (cited in App. 313, no. 7); Enloe, Sylvester, & Morris, Hazards of Intra-Arterial Injection of Hydroxyzine, 16 Canadian Anaesthetists’ Society J. 425 (1969) (hereinafter Enloe) (noting “recent reports” of “the occurrence of severe necrosis and gangrene following [administration of] promethazine (Phenergan®)” (cited in App. 314, no. 15)). See also Mostafavi & Samimi, Accidental Intra-arterial Injection of Promethazine HCl During General Anesthesia, 35 Anesthesiology 645 (1971) (reporting a case of gangrene, which required partial amputation of three fingers, after Phenergan was inadvertently pushed into an artery in the “antecubital” area); Promethazine, p. 7, in Clinical Pharmacology (Gold Standard Multimedia Inc. CD–ROM, version 1.16 (1998) (noting that “[i]nadvertent intra-arterial injection [of Phenergan] can result in arteriospasm … and development of gangrene”)).
8 Hager and Wilson noted that the most common reactions to intra-arterial injections of drugs like Phenergan include “[i]mmediate, severe, burning pain,” as well as “blanching.” 94 Archives of Surgery, at 87–88. The FDA required Wyeth to include Hager and Wilson’s observations on Phenergan’s label. See App. 311 (requiring the label to warn that “ ‘[t]he first sign [of an intra-arterial injection] may be the patient’s reaction to a sensation of fiery burning’ ” pain and “ ‘[b]lanching’ ”).
9 See Enloe 427 (discussing hydroxyzine—an antihistamine with chemical properties similar to those of Phenergan—and suggesting its “temporary” benefits can never outweigh the risks of intra-arterial injection); see also Goldsmith & Trieger, Accidental Intra-Arterial Injection: A Medical Emergency, 22 Anesthesia Progress 180 (1975) (noting the risks of intra-arterial administration of hydroxyzine) (cited in App. 315, no. 18); Klatte, Brooks, & Rhamy, Toxicity of Intra-Arterial Barbituates and Tranquilizing Drugs, 92 Radiology 700 (1969) (same) (cited in App. 314, no. 13). With full knowledge of those risks, FDA retained IV push for Phenergan, although the agency required Wyeth to incorporate observations from the Enloe article into Phenergan’s label. Compare Enloe 427 (arguing that “every precaution should be taken to avoid inadvertent intra-arterial injection,” including the use of “an obviously well-functioning venoclysis”), with App. 312 (FDA’s 1987 changes to Phenergan’s label). In contrast, at some time around 1970, the FDA prohibited all intravenous use of hydroxyzine. See id., at 79 (testimony of Dr. Harold Green). The FDA’s decision to regulate the two drugs differently—notwithstanding (1) the agency’s knowledge of the risks associated with both drugs and (2) the agency’s recognition of the relevance of hydroxyzine-related articles and case reports in its regulation of Phenergan—further demonstrates that the FDA intentionally preserved IV-push administration for Phenergan. See also Haas, Correspondence, 33 Anesthesia Progress 281 (1986) (“[Hydroxyzine’s] restriction does not lie with the medicine itself, but in the practice and malpractice of intravenous techniques. Unfortunately, the practitioner who knows how to treat injection technique problems is usually not the practitioner with the intravenous technique problems”).
10 See also Engler, Freeman, Kanavage, Ogden, & Moretz, Production of Gangrenous Extremities by Intra-Arterial Injections, 30 Am. Surgeon 602 (1964) (“Accidental arterial injection most often occurs in the antecubital region because this is a favorite site for venopuncture and in this area the ulnar and brachial arteries are superficial and easily entered” (cited in App. 313, no. 6)); Engler, Gangrenous Extremities Resulting from Intra-arterial Injections, 94 Archives of Surgery 644 (1966) (similar) (cited in App. 314, no. 16); Lynas & Bisset, Intra-arterial Thiopentone, 24 Anaesthesia 257 (1969) (“Most [anesthesiologists] agree that injections on the medial aspect of the antecubital fossa are best avoided” (cited in App. 314, no. 8)); Waters, Intra-arterial Thiopentone, 21 Anesthesia 346 (1966) (“The risk of producing gangrene of the forearm by accidental injection of sodium thiopentone into an artery at the elbow has been recognised for many years” (cited in App. 314, no. 10)); see also Hager & Wilson, 94 Archives of Surgery, at 88 (emphasizing that one of the best ways to prevent inadvertent intra-arterial injections is to be aware of “aberrant or superficial arteries at the antecubital, forearm, wrist, and hand level”); Mostafavi & Samimi, supra (warning against antecubital injections).
11 See App. 311 (requiring Phenergan’s label to warn that practitioners should “ ‘[b]eware of the close proximity of arteries and veins at commonly used injection sites and consider the possibility of aberrant arteries’ ”).
12 “Aspiration” refers to drawing a small amount of blood back into the needle to determine whether the needle is in an artery or a vein. Ordinarily, arterial blood is brighter than venous blood—but contact with Phenergan causes discoloration, which makes aspiration an unreliable method of protecting against intra-arterial injection. See id., at 282. Therefore, the label warned that when using IV push, a medical professional should beware that “[a]spiration of dark blood does not preclude intra-arterial needle placement, because blood is discolored upon contact with Phenergan Injection.” Id., at 390.
13 In addition, respondent’s own medical expert testified at trial that it is a principle of “basic anatomy” that the antecubital fossa contains aberrant arteries. See 2 Tr. 34–35 (Mar. 9, 2004) (testimony of Dr. Daniel O’Brien); see also ibid. (noting that Gray’s Anatomy, which is “the Bible of anatomy,” also warns of arteries in the antecubital space).
14 Thus, it is not true that “this Court has long” applied a presumption against pre-emption in conflict pre-emption cases. Ante, at 9, n. 3 (majority opinion). As long ago as Gibbons v. Ogden, 9 Wheat. 1, 210 (1824), the Court inquired whether a state law “interfer[ed] with,” was “contrary to,” or “c[a]me into collision with” federal law—and it did so without ever invoking a “presumption.” See also Davis, Unmasking the Presumption in Favor of Preemption, 53 S. C. L. Rev. 967, 974 (2002) (noting that many of the Court’s early pre-emption cases “resulted in almost automatic preemption of concurrent state regulation”). In subsequent years the Court has sometimes acknowledged a limited “presumption against pre-emption,” but it nonetheless remained an open question—before today—whether that presumption applied in conflict pre-emption cases. See Crosby v. National Foreign Trade Council, 530 U. S. 363 , n. 8 (2000) (“We leave for another day a consideration in this context of a presumption against preemption”). Moreover, this Court has never held that the “presumption” applies in an area—such as drug labeling—that has long been “reserved for federal regulation.” United States v. Locke, 529 U. S. 89, 111 (2000) . See also Buckman Co. v. Plaintiffs’ Legal Comm., 531 U. S. 341, 347–348 (2001) .
15 Vesicants may cause “blistering, severe tissue injury, or tissue necrosis” upon extravasation—even if the drug is not injected into an artery. See, e.g., Schulmeister, Administering Vesicants, 9 Clinical J. of Oncology Nursing 469, 469–470 (2005). See also ante, at 4 (majority opinion) (noting that Phenergan is labeled as an “irritant”); cf. Brief for Anju Budhwani et al. as Amici Curiae 15 (suggesting Phenergan should be considered a “vesicant”).
16 FDA, Oncology Tools Product Label Details, online at http://www.accessdata.fda.gov/scripts/cder/onctools/labels.cfm?GN=meclorethamine,%20nitrogen%20mustard (as visited Mar. 2, 2009, and available in Clerk of Court’s case file).
18 The same is true of FDA’s regulation of hydroxyzine. See n. 9,supra.


text:
The Complainant is Rovos Rail (Pty) Limited of Rovos Rail Coach, Dock Road, Victoria & Alfred Waterfront, Cape Town, South Africa, represented by D M Kisch Incorporated, of Sandton, South Africa.
The Respondent is Innovative Technical Solutions of 509 Tag Lane, Ramona, California, United States of America.
The disputed domain name is <rovosrail.com>.
The Registrar is Tucows Inc., of Toronto, Ontario, Canada.
The Complaint was received by the Center by email on October 25, 2001, and in hard copy on October 30, 2001. It named as Respondent Marco Polo Vacations of San Diego, California. The Complaint was acknowledged on November 2, 2001, and on November 5, 2001, the Center sought registration details from the Registrar. On November 6, 2001, the Registrar informed the Center that the disputed domain name was registered with it but that the current registrant is Innovative Technical Solutions; that the language of the Registration Agreement is English and that the Policy applies to the disputed domain name, the status of which is "on hold within our system, to ensure that no changes occur to the ownership or Registrar for the duration of the dispute".
On November 7, 2001, the Center notified the Complainant of the deficiency in the Complaint, because it did not identify the registrant of the domain name as the Respondent. On November 13, 2001, by email and on November 19, 2001, in hard copy, the Complainant filed an amendment to the Complaint naming Innovative Technical Solutions as Respondent.
The Center satisfied itself on November 20, 2001, that the Amended Complaint complied with all formal requirements (including payment of the prescribed fee) and that day formally dispatched copies of the Amended Complaint by post/courier (with enclosures) to the Respondent at the address mentioned above and by facsimile and email (without attachments). The Center included with that material a letter dated November 20, 2001, containing notification of the commencement of this administrative proceeding.
The last day specified by the Center for a Response was December 10, 2001. No Response was filed and on December 18, 2001, the Center notified the parties of the Respondent�s default.
The Complainant had elected to have the case decided by a single-member Panel and on January 10, 2002, the Center notified the parties of the appointment of Alan L. Limbury as panelist, Mr. Limbury having submitted a Statement of Acceptance and Declaration of Impartiality and Independence. That day the Center transmitted the case file to the Panel and notified the parties of the projected decision date of January 24, 2002.
In response to a request from the Panel, the Registrar confirmed that the transfer of the registration of the disputed domain name from Marco Polo Vacations to the Respondent, Innovative Technical Solutions, occurred on October 5, 2001 (before the Complaint was filed), not on October 29, 2001 (after the Complaint was filed), as stated in the Amended Complaint.
Accordingly, by Procedural Order No. 1, the Panel directed that the Complainant be given an opportunity to make further submissions and to provide further evidence to the Panel, by February 4, 2002, to demonstrate a case against Innovative Technical Solutions based either on Innovative Technical Solutions� conduct or on a connection between Marco Polo Vacations and Innovative Technical Solutions on which the Complainant may wish to rely.
On the basis that the Respondent had failed to submit a Response to the Amended Complaint, the Order did not make provision for the Respondent to reply to any further submission made by the Complainant but provided that the Respondent should make any request to do so to the Center by February 8, 2002, in which case the Panel would issue a further Order to allow the Respondent to submit a response only to any new information provided by the Complainant.
Regardless of whether any further submissions were made, the Panel extended the time for its decision until February 12, 2002.
On February 1, 2002, the Complainant filed with the Center and served on the Respondent a further submission. No request was made by the Respondent for leave to reply to it.
The Panel is satisfied that the Complaint, as filed and as subsequently amended, was in accordance with the requirements of the Rules and Supplemental Rules; payment was properly made; the Panel agrees with the Center�s assessment concerning the Amended Complaint�s compliance with the formal requirements; the Center discharged its responsibility under paragraph 2(a) of the Rules to employ reasonably available means calculated to achieve actual notice of the Amended Complaint to the Respondent. No Response was filed to the Amended Complaint nor to the Complainant�s further submission. The Panel was properly constituted.
The language of the proceedings was English, being the language in which all submissions were filed.
The Complainant is the proprietor of the trade mark ROVOS RAIL, consisting of the word ROVOS, made up from the name of the Managing Director of the Complainant, ROHAN VOS, and the descriptive word RAIL. The Complainant has trade mark applications and registrations for the trade mark ROVOS RAIL in South Africa, Zimbabwe, Namibia and in the United States of America.
Since its incorporation in 1989, the Complainant has continuously conducted train safaris throughout Africa and advertised and promoted these services in various parts of the world.
The Complainant has representative offices in South Africa, Germany, England, Australia and the United States. Most of the Complainant�s business is channelled through these offices.
As a result of extensive national and international marketing and advertising campaigns, the Complainant has developed a reputation and goodwill in its ROVOS RAIL name and trade mark in the international travelling and holiday market, which is readily and distinctively associated throughout the world with the Complainant�s touring services. The Complainant has acquired a substantial international reputation through its continued exposure in the international media.
Marco Polo Vacations Inc ("MP") operated for some time as one of the Complainant�s tour operators in the United States, generating income from commission from the Complainant in booking passengers on tours provided and arranged by the Complainant under its ROVOS RAIL trade mark on its various routes. Apart from the initial booking, MP was not involved in rendering any of the services provided by the Complainant.
Although MP was authorised to make bookings with the Complainant on behalf of passengers and to advertise the Complainant�s services using advertising material, such as brochures and pamphlets, provided by the Complainant, MP was never authorised to use the Complainant�s intellectual property, including the ROVOS RAIL name and trade mark. MP was never authorised to use the Complainant�s trade mark in the disputed domain name.
MP registered the disputed domain name on June 15, 2000, and shortly thereafter so informed the Complainant. The Complainant requested MP to assign the name to it upon payment of MPs registration costs. No progress was made.
On January 4, 2001, MP offered to sell the disputed domain name to the Complainant, together with 3 other domain names (not relevant here) for US$250,000. On April 23 2001, MP rejected an offer from the Complainant to buy the disputed domain name for US$5000 and said it would sell it for US$45,000.
After MP transferred registration of the disputed domain name to the Respondent, the Complainant approached the Respondent on November 8, 2001, setting out the facts and attaching a copy of the Complaint with a view to settle the matter amicably. The Respondent replied that all future correspondence should be addressed to Marco Polo Vacations "�the party responsible for the registration of this domain".
The following is taken from the Complaint.
The Complainant requests the Panel to direct that <rovosrail.com> be transferred to Complainant on the following legal grounds.
The disputed domain name is identical to the Complainant�s registered trade mark ROVOS RAIL.
The fact that MP registered the disputed domain name, which wholly incorporates the Complainant�s trade mark, together with the conduct of MP, leaves no doubt that the adoption of this domain name was a carefully planned and calculated step intended to take unfair advantage of the international repute and goodwill of the Complainant�s trade mark. It is also blatantly obvious that MP has no claim whatsoever to the above domain name or trade mark, especially as the services advertised on the web site using the disputed domain name are provided by the Complainant only, without MP participating on any level.
There can be no doubt that the public will be confused, and in fact have been confused, into believing that the domain name and the web site are those of the Complainant or that the Complainant is associated with or endorses MPs business, which it clearly does not.
In view of the facts that the Complainant commenced use of the name ROVOS RAIL in 1989, 11 years prior to MPs registration of the disputed domain name in June 2000, and that MP conducted business with the Complainant before it registered the disputed domain name, MPs registration of the disputed domain name is an attempt unfairly to exploit the Complainant�s goodwill and reputation in the ROVOS RAIL trade mark.
MP cannot deny that it was fully aware of the Complainant�s rights to and reputation in the name ROVOS RAIL. MP was fully aware of the Complaint at the time of transfer of the domain name on October 29, 2001, after the Complaint was filed.
It is therefore clear that MP attended to the transfer of its domain name with the sole purpose of avoiding proceedings against it and that its actions were in fact mala fide.
The Respondent has no legitimate right or interest in respect of the domain name in question and has no reputation therein whatsoever.
The Respondent�s actions have prevented the Complainant from registering its trade mark as a domain name, thereby preventing it from effectively marketing and promoting its products in the Internet environment.
Furthermore, the Respondent is fully aware of the Complainant�s right in and to the trade mark ROVOS RAIL as well as all the surrounding facts because the Respondent received a copy of the Complaint on November 7, 2001, prior to its amendment. The Respondent�s actions were mala fide in that the Respondent has intentionally and unlawfully registered the disputed domain name with a view to (a) preventing the Complainant from registering its trade mark as a domain name and (b) using this as leverage to demand an undue amount of money for the transfer of the domain name to the Complainant. These actions were at all relevant times mala fide.
The transfer of the domain name from MP to the Respondent on October 29, 2001, [scil October 5, 2001] as per the Registrar (Tucows, Inc) and not October 29, 2001, as reflected in the Amended Compliant, does not affect the basis of the Complaint.
MPs actions were at all times mala fide and it was fully aware of possible further action that will be taken by the Complainant. MP attended to the transfer of its domain name with the sole purpose of avoiding proceedings against it.
Furthermore, the Respondent still has no legitimate right or interest in respect of the disputed domain name and to the trade mark ROVOS RAIL as set out in Amended Complaint.
Under paragraph 8(a) of the Policy, which forms part of the registration agreement, a registrant may not engage in "cyberflying" - transferring a domain name registration to another holder during a "pending" proceeding. Any such transfer may be cancelled by the Registrar.
Under Rule 3(xii), a respondent is notified of a proceeding before its formal commencement. To avoid injustice to complainants, several Panel decisions have interpreted paragraph 8(a) as applying from the initiation of the proceeding (by the filing of the complaint) rather than from the formal commencement of the proceeding under Rule 3(a): British Broadcasting Corporation v. Data Art Corporation / Stoneybrook (WIPO Case No. D2000-0683); Disney Enterprises, Inc. v. John Zuccarini, Cupcake City and Cupcake Patrol (WIPO Case No. D2001-0489); Imperial Chemical Industries, PLC v. Oxford University (WIPO Case No. D2001-0292); Kabushiki Kaisha Isetan v. Stars Web International and Isetan, Inc. (WIPO Case No. D2001-0732) and Köstritzer Schwarzbierbrauerei v. Macros-Telekom Corp. (WIPO Case No. D2001-0936).
Here the transfer from MP to the Respondent cannot be cancelled because it took place on October 5, 2001, before the Complaint was filed. Accordingly this proceeding is not against MP but against Innovative Technical Solutions. The Complainant must establish grounds for relief against Innovative Technical Solutions.
Numerous cases under the Policy have adopted and applied the principle that a respondent�s failure to dispute the allegations of the complainant permits the inferences that the complainant�s allegations are true and that the respondent knows its website is misleading. See, for example, Hewlett-Packard Company v. Full System (Case FA 0094637); David G. Cook v. This Domain is For Sale (Case FA0094957) and Gorstew Jamaica and Unique Vacations, Inc. v. Travel Concierge (Case FA0094925).
"The Panel draws two inferences where the Respondent has failed to submit a response: (a) "the Respondent does not deny the facts which the Complainant asserts" and (b) "the Respondent does not deny the conclusions which the Complainant asserts can be drawn from those facts"."
Essential or virtual identity is sufficient for the purposes of the Policy: see The Stanley Works and Stanley Logistics, Inc v. Camp Creek. Co., Inc. (WIPO Case No. D2000-0113), Toyota Jidosha Kabushiki Kaisha d/b/a Toyota Motor Corporation v. S&S Enterprises Ltd. (WIPO Case No. D2000-0802); Nokia Corporation v. Nokiagirls.com a.k.a IBCC (WIPO Case No. D2000-0102) and Blue Sky Software Corp. v. Digital Sierra Inc. (WIPO Case No. D2000-0165).
The disputed domain name is virtually identical to the Complainant�s registered trade mark ROVOS RAIL.
The Complainant has not authorized the Respondent to use its trademark nor to register the disputed domain name. The name of the Respondent is not and does not include any part of any of the disputed domain name. The trademark is well known. It combines an invented word (derived from the name of the Managing Director of the Complainant) with a descriptive word, the combination being distinctive of the Complainant�s services, which are promoted in many countries, including the United States of America where the Respondent resides. These circumstances shift the onus to the Respondent to demonstrate its rights to or legitimate interest in the disputed domain name: Do The Hustle, LLC v. Tropic Web (WIPO Case No. D2000-0624) and the cases there cited.
In the absence of a Response, the Panel is satisfied that the Complainant has established this element. The Respondent has no right or legitimate interest in respect of the disputed domain name.
The circumstances specified in paragraph 4(b) of the Policy as constituting evidence of both bad faith registration and use are not exhaustive.
There is no doubt that MP registered and used the disputed domain name in bad faith but this does not establish bad faith on the part of the Respondent. The Panel accepts the Complainant�s submissions that the conduct of MP was at all times mala fide; that MP was fully aware of possible further action by the Complainant; that MP attended to the transfer of its domain name with the sole purpose of avoiding proceedings against it and that the Respondent has no legitimate right or interest in the disputed domain name.
Bearing in mind that this proceeding is against the Respondent rather than MP, the critical question, a difficult one in this case, is whether there is any basis for findings of bad faith registration and bad faith use by the Respondent.
The Complainant submits that the Respondent and MP were fully aware of the Complaint at the time of the transfer of the disputed domain name. That submission was based on Annexure AA, being a �Whois� search conducted on October 31, 2001. That search revealed merely that the record had been last updated (without specifying what the update was) on October 29, 2001. The Registrar, in response to an enquiry from the Center at the behest of the Panel, confirmed that the transfer actually took place on October 5, 2001, i.e. before the Complaint was filed. Accordingly Annexure AA does not support this conclusion.
The Complainant submits that when the Respondent applied for the registration of the disputed domain name, the Complainant had already established a huge international reputation in its trade mark. In the absence of a Response, the Panel is entitled to draw this conclusion. However, it is a conclusion which falls short of a finding that the Respondent was aware of the Complainant�s trade mark when it became the registrant of the domain name.
"Please direct future messages to Marco Polo Vacations. Marco Polo Vacations is the party responsible for the registration of this domain".
First the Complainant says this confirms the present registration was done in bad faith and that MP is attempting to delay the finalisation of the present proceedings "by way of a bogus assignment to" the Respondent.
Second, the Complainant says this makes clear that the Respondent "is assisting [MP] to obtain its goals�as well as to assist [MP] to demand an undue amount of money for the transfer of the domain name to the Complainant".
The Panel is concerned to avoid any injustice to an innocent transferee of a domain name registration without notice of the Complainant�s mark nor of the bad faith of the transferor. In this case the Panel concludes (after much anxious consideration) that it would not be unjust to the Respondent for the Panel to accept the Complainant�s submissions on this point.
The Respondent must be taken to have known that it was by then the registrant of the disputed domain name. In the face of the Complainant�s assertion of trade mark rights and its stated intention to amend the Complaint so as to name the Respondent, simply to refer the Complainant to MP was hardly the act of an innocent transferee, independent of MP and having no knowledge of what had transpired between the Complainant and MP. It is consistent with knowing participation in a scheme by MP to avoid the Complainant�s claim and to extract undue payment for the disputed domain name. The failure to file a Response in the face of such serious accusations also enables this conclusion to be drawn.
Accordingly the Panel concludes that the disputed domain name was registered by the Respondent on October 5, 2001, in bad faith in that it was done as a means of assisting MP to avoid proceedings under the Policy and to extract an undue amount of money from the Complainant.
The Panel also concludes that the Respondent has used the disputed domain name in bad faith by holding it in furtherance of a scheme to assist MP to those ends. The �use� requirement does not require positive action, inaction being within the concept: Telstra Corporation Limited v. Nuclear Marshmallows (WIPO case D2000-0003); Barney�s, Inc. v. BNY Bulletin Board (WIPO case D2000-0059); CBS Broadcasting, Inc. v. Dennis Toeppen (WIPO case D2000-0400); Video Networks Limited v. Larry Joe King (WIPO case D2000-0487); Recordati S.P.A. v. Domain Name Clearing Company (WIPO case D2000-0194) and Revlon Consumer Products Corporation v. Yoram Yosef aka Joe Goldman (WIPO case D2000-0468).
Pursuant to paragraphs 4(i) of the Policy and 15 of the Rules, the Panel directs that the domain name <rovosrail.com> be transferred to the Complainant.

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The NAACP Legal Defense and Educational Fund, Inc. (LDF) deeply mourns the passing of Linda Brown Thompson who was one of the young students at the heart of LDF’s landmark case, Brown v. Board of Education of Topeka, Kansas, that helped bring an end to racial segregation in America’s public schools. The bravery and resilience of the Brown family and the one dozen other African-American families who participated in the suit transformed the trajectory of this country and ushered in the end of racial segregation in all facets of American society. Ms. Brown Thompson died March 25, 2018, at age 75, in Topeka, Kansas.
Brown Thompson was born on February 20, 1943, in Topeka, Kansas. In 1951, LDF represented Rev. Oliver L. Brown, on behalf of his third-grade daughter Linda, in a lawsuit against the Topeka Board of Education. At the time, McKinley Burnett, president of the local NAACP, was organizing the Topeka case. He successfully enlisted a class of 13 local plaintiffs including Rev. Brown.
Rev. Brown had attempted to enroll his young daughter in the all-white Sumner Elementary School. When the school refused to enroll Linda, she was instructed to attend the under-resourced all-Black Monroe School, two miles away from her home. Rev. Brown promised Linda that he would challenge the school’s decision.
LDF proudly represented Rev. Brown and a cadre of 12 families from South Carolina, Delaware, Virginia, and the District of Columbia who had been suffering similar injustices. Their lawsuits were consolidated into what is now known as Brown v. Board of Education.
Lawyers for “Brown v. Board of Education” gathered in front of courthouse.
In the 1930s, Charles Hamilton Houston began masterminding the multi-year legal strategy that led to Brown, and later Thurgood Marshall — Houston’s protégé — executed the legal campaign to end school segregation. Marshall led a legal dream team and a brain trust of cutting-edge researchers to prepare for Brown. The legal team included Jack Greenberg (LDF’s second Director-Counsel and Marshall’s successor), Constance Baker Motley (the first African-American woman appointed as a federal court judge), Robert Carter, Spottswood Robinson II, Oliver Hill, Louis Redding, Charles and John Scott, Harold R. Boulware, James Nabrit Jr., and George E.C. Hayes.
Favorable Supreme Court rulings in a series of civil rights cases litigated by LDF, including Missouri ex rel. Gaines v. Canada, Sipuel v. Oklahoma State Regents, McLaurin v. Oklahoma State Regents, and Sweatt v. Painter — a 1950 case that ruled that “separate and equal” law schools for Blacks could not provide a legal education “equal” to that available to white students — secured Brown’s success. These cases along with Justice John Marshall Harlan’s stirring dissent in Plessy v. Ferguson — a shameful precedent from 1896 that upheld the constitutionality of the “separate but equal” doctrine and gave rise to Jim Crow laws across the South — provided the legal foundation LDF attorneys needed to bring down segregation in public elementary and secondary schools throughout the country.
The Brown ruling overturned the “separate but equal” doctrine, enshrined in Plessy, in our nation’s public schools. The decision also spurred a student movement marked by the student-led sit-ins, bus boycotts, and marches that have become touchstones of the Civil Rights Movement. Legislation from that era and additional court rulings eventually dismantled the legal framework of racial segregation in its entirety.
For the remainder of her life, Brown Thompson steadfastly supported the civil rights cause. After the decision, the Brown family moved in 1959 to Springfield, Missouri. Brown Thompson graduated from Central High School in Springfield and received certification in early childhood education from Kansas State University.
In 1979, Brown Thompson sued the Topeka schools, on behalf of her own children, for not following through with desegregation as mandated by the original Brown case. Federal Judge Richard Rogers ruled in favor of the school district, but an appeals court reversed his ruling. The Supreme Court then declined to review the decision. Judge Rogers approved a desegregation plan for the school district in 1993.
Brown Thompson travelled the country lecturing with family members on the Brown litigation and issues of education inequity. She also served as a Program Associate with The Brown Foundation where she assisted in establishing four libraries for preschool children. The foundation, housed in Brown Thompson’s former grade school, commemorates and advances public discourse about Brown’s impact.
Brown Thompson and her family’s story is a testament to the courage and persistence of many Black families and their abiding faith in the possibility of a more just, more equal nation. Their story also demonstrates the risks Black families have taken throughout American history to seek justice for all children. The sacrifices of the families represented in Brown advanced America’s path toward equality and continues to fuel the struggle for true equity today.
Linda Brown (far left) with her family.

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Sometimes we receive a W2 or a 1099 that is incorrect. We may receive one of these forms with a wrong dollar amount or one issued to someone else with our social security on it. Most of the time someone made an honest mistake that can be corrected. The IRS does provide correcting forms that are filed by the issuer. Having said this, there may be an instance when you are on the receiving end of an erroneous W-2 or a 1099 that has been deliberately issued by someone with bad motives. Is there anything you can do to get even with this person? Yes there is.
In this article we will look at the case of Nicholas Angelopoulos v. Martin R. Hall, M.D. et al 2015-1 USTC ¶50,306, (May 15, 2015).
Dr. Nicholas Angelopoulos (hereafter referred to as Nicholas) joined a medical partnership headed by Dr. Hall. This partnership was known as Keystone. He also entered into a second business relationship with Dr. Hall and other physicians known as WACHN, LLC. It turned out that Dr. Hall was a major crook and did everything in his power to cheat his fellow partners out of their fair shares. The partnerships did not last long. When the partners found out the nature and the extent of Hall’s cheating, they all wanted out. Even in the process of dissolving the partnerships, Dr. Hall falsified records in an attempt to show that the partnerships were not profitable. He tried to cram a settlement down the throats of his partners. When Nicholas refused the deal, Hall decided to get even. At the end of the year he sent Nicholas a false Form 1099-MISC issued by Keystone in the amount of $160,000, although Nicholas only earned $38,000. Hall caused Keystone to file the 1099 with the IRS.
Nicholas filed his federal income tax return correctly reporting to the IRS only $38,000 from the partnership. This caused the IRS to send him a letter challenging the return because of the $160,000 bogus 1099. The IRS issued a Notice of Deficiency alleging that Nicholas had failed to pay taxes on $160,000 of income. Nicholas had to file a petition in the U.S. Tax Court alleging that the income reported on the 1099 was inflated. Eventually the IRS agreed with him. Nicholas turned around and sued Hall in the U.S. District Court for damages suffered by the bogus 1099. Nicholas used IRC §7434 to get even with Hall.
IRC § 7434 is entitled, "Civil Damages for Fraudulent Filing of Information Returns." This section of the Internal Revenue Code allows you to sue someone who issued you a fraudulent W-2 or 1099. If you prevail your award is the greater of $5,000 or the sum of the actual damages you incurred, plus court costs, and at the court’s discretion, reasonable attorney fees. In order to prevail you have to show a "bad motive" on the part of the person who issued the fraudulent 1099. An honest mistake is not going to win the day for you.
How did Nicholas come out?
Hall tried to defend himself without success. He argued that he personally did not issue the 1099, rather the Keystone partnership issued it. Therefore, Hall should not be personally liable. Hall argued the case of Vandenheede v. Vecchio, 2013 U.S. Dist. LEXIS 25845 (E.D. Mich 2013). In this case the trustees of a trust caused an accounting firm to issue a fraudulent 1099. The accountants were sued along with the trustees. The accountants argued successfully that they were not responsible under the law because they merely put down what the trustees told them. The accountants won.
The judge held that Hall could not hide behind Keystone and dodge the bullet. He was directly responsible.
The judge cited the history behind IRC § 7434. Before its enactment federal law provided no private cause of action to a taxpayer injured because a fraudulent information return had been filed with the IRS asserting that payments had been made to the taxpayer. Some taxpayers may suffer significant personal loss and inconvenience as a result of the IRS receiving fraudulent information returns, which had been filed by persons intent on either defrauding the IRS or harassing taxpayers. These are the reasons why IRC § 7434 was enacted.
As Keystone’s president and secretary, Hall used his control over its finances, its record keeping, and its tax filings to report false information about Nicholas in Keystone’s returns. The judge stated, "As a person allegedly ‘intent on either defrauding the IRS or harassing taxpayers’ through Keystone’s returns, Hall appears to be precisely the type of person whose conduct the legislative history addressed."
Nicholas won his lawsuit against Hall for issuing to him a fraudulent information return, Form 1099. Sending a fraudulent W-2 or 1099 to the IRS is cowardly thing to do. It’s easy to do and it causes the recipient much grief. If this happens to you, you do not have to take it lying down.
Robert Schriebman has a successful practice in the Rolling Hills Estates area of Los Angeles County serving clients throughout California and the United States. He has successfully dedicated more than 40 years to helping individual taxpayers, business owners, CPAs, Enrolled Agents, and tax attorneys navigate the complicated tax systems of the federal and state governments.


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The Complainants are Donna Karan Studio LLC., Gabrielle Studio, Inc., and The Donna Karan Company LLC of New York, New York, United States of America, represented by Cho & Partners, Republic of Korea.
The Respondent is DKNY PARTY of New York, New York, United States of America.
The disputed domain name <dknyparty.com> (the “Disputed Domain Name”) is registered with Tucows Inc.
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on February 25, 2010. On February 25, 2010, the Center transmitted by email to Tucows Inc. a request for registrar verification in connection with the Disputed Domain Name. On February 26, 2010, Tucows Inc. transmitted by email to the Center its verification response disclosing registrant and contact information for the Disputed Domain Name which differed from the named Respondent and contact information in the Complaint. The Center sent an email communication to the Complainant on March 2, 2010, providing the registrant and contact information disclosed by the Registrar, and inviting the Complainant to submit an amendment to the Complaint. Complainant filed an amended Complaint on March 9, 2010. The Center verified that the amended Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).
The Center appointed Andrew J. Park as the sole panelist in this matter on April 8, 2010. The Panel finds that it was properly constituted. The Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.
Complainant, Donna Karan Studio, is the exclusive licensee of the trademarks consisting of or including the name or initials of Ms. Donna Karan. Ms. Karan is a well known and highly regarded designer of fashion and related accessories.
Ms. Karan began her professional career as a fashion designer at Anne Klein & Company. After Ms. Klein's death in 1974, Ms. Karan became the head designer of Anne Klein & Company and held that position for ten years, during which time she received considerable press attention, both in the United States of America and internationally. In late 1984, Ms. Karan left Anne Klein & Company to start her own label. In 1985, she founded The Donna Karan Company LLC (“The Company”), where she has been Chief Designer ever since. Ms. Karan's new line of designer women's fashion, marketed by The Company under the trademark DONNA KARAN NEW YORK was a commercial success and well publicized in the media.
In 1988, The Company launched a second more moderately priced line of clothing and accessories under the trademark DKNY, an abbreviation of the trademark DONNA KARAN NEW YORK. The Company's DKNY collection was a commercial success, and today there are over ninety DKNY and Donna Karan stores worldwide. Goods from the DKNY line bear the trademark DKNY alone or the trademark DKNY Logo. The DKNY Logo is comprised of the trademark DKNY and the trademark DONNA KARAN NEW YORK.
Complainants' hold registered trademarks for DKNY and a DKNY Logo in the European Community, the United Kingdom and in the United States for various goods including handbags, jewelry, and women's apparel. The trademarks DKNY and DKNY Logo have been registered for clothing and related fashion accessories (such as footwear, sunglasses, leather goods, and jewelry) in approximately 115 countries throughout the world.
In 1996, Ms. Karan assigned the trademarks consisting of or including her name or initials to Complainant Gabrielle Studio, Inc. (“Gabrielle”), and Gabrielle, in turn, granted Complainant Donna Karan Studio an exclusive license to use and to sublicense the use of the trademarks throughout the world. Donna Karan Studio licenses the use of the trademarks to various companies, including The Company, of which Ms. Karan is the Chief Designer. Gabrielle, Donna Karan Studio and The Company are all wholly owned by Donna Karan International, Inc., a Delaware corporation.
Clothing bearing the trademarks DKNY and DKNY Logo was first marketed and sold in the United States in 1988. Since that time, DKNY clothing and related goods have been marketed and sold in many other countries throughout the world, including in republic of Korea, Australia, Belgium, Brazil, Canada, Cyprus, France, Germany, Greece, Hong Kong - SAR of China, Iceland, Indonesia, Israel, Indonesia, Italy, Japan, Kuwait, Lebanon, Malaysia, Monaco, the Netherlands, Norway, the Philippines, Portugal, Saudi Arabia, Singapore, South Africa, Spain, Switzerland, Taiwan, Thailand, Turkey, United Arab Emirates, the United Kingdom of Great Britain and Northern Ireland, and Venezuela. Today, there are in excess of 115 company-owned and licensed free standing Donna Karan collection, DKNY, and DKNY JEANS stores worldwide. The Company advertises its DONNA KARAN NEW YORK and DKNY products on the Internet through numerous domain names including <dkny.com> and <donnakaran.com>.
As Chief Designer of The Company, Ms. Karan has been honored with numerous awards for her fashion designs and related products. For example, in 1990, Ms. Karan was voted “Women's Wear Designer of the Year,” and in 1992, she was voted “Men's Wear Designer of the Year,” both by the Council of Fashion Designers of America (“CFDA”). Ms. Karan won the Fifi Award for best Women's Fragrance Introduction of 1992 (for her women's fragrance marketed and sold under the trademark DONNA KARAN NEW YORK), and the Fifi Award for best Men's Fragrance Introduction of 1994 (for her men's fragrance marketed and sold under the trademark DK MEN). In 1996, Ms. Karan was once again voted Women's Wear Designer of the Year by the CFDA, and was presented with the Parson's Award for Outstanding Achievement. In 2003, Ms. Karan was the first American designer to receive Fashion Group International's “Superstar Award.” In 2004, Ms. Karan received the CFDA Lifetime Achievement Award. In 2004, Ms. Karan also received an honorary doctorate from her Alma mater, the Parsons School of Design, to commemorate her contribution to the school and the fashion industry. In 2007, Glamour magazine named Ms. Karan one of its women of the year.
Complainants argue that: (i) the Disputed Domain Name is identical or confusingly similar to a mark in which the Complainants have rights; (ii) Respondent has no rights or legitimate interests in respect of the Disputed Domain Name; and (iii) the Disputed Domain Name was registered and is being used in bad faith. Regarding the first element, Complainant contends that the Disputed Domain Name <dknyparty.com> contains the registered trademark DKNY in which Complainant Donna Karan Studio has exclusive rights, and that the Disputed Domain Name is essentially identical and/or confusingly similar to Complainants' famous DKNY trademark. Complainants assert that the term “party” is not distinctive and should be given little if any consideration when comparing the Disputed Domain Name with the trademark DKNY. Complainants conclude that the term “party” contributes to a likelihood of confusion, since this term might naturally be viewed as somehow associated with the DKNY brand.
Regarding the second element, Complainants contend that Respondent has no rights or legitimate interests in respect of the Disputed Domain Name. To the best of Complainants' knowledge, Respondent does not own any trademark or servicemark registration that is identical, similar, or in any way related to the DKNY or DKNY Logo marks or the Disputed Domain Name. Complainants contend, moreover, that Respondent is not a licensee of Complainants, and that Respondent has never been authorized by Complainants to use the DKNY trademarks, nor been authorized to register the Disputed Domain Name.
In reference to the third element, Complainants contend that Respondent registered the Disputed Domain Name with knowledge of the famous DKNY and DKNY Logo trademarks, that the DKNY clothing line was launched decades before Respondent registered the Disputed Domain Name containing the term DKNY in 2008, and that the DKNY brand is marketed and so recognized worldwide that Respondent must have been aware of it at the time Respondent registered the Disputed Domain Name.
Complainants further contend that Respondent's use of Complainants' DKNY mark falsely suggests that Complainants are or may be associated with the website of the Disputed Domain Name. Complainants state that on July 9, 2009, they checked the website to which the Disputed Domain Name resolved and it was being used to promote a party which had no relationship, affiliation, or other connection to Complainants or the DKNY brand. Complainants checked the website again on August 4, 2009, and the website was not operational. Complainant again checked the website on December 9, 2009, and it was once again being used to promote parties that had no relationship, affiliation, or other connection with Complainants or the DKNY brand. Complainants contend that the Disputed Domain Name was registered with the intent of attracting Internet users to the <dknyparty.com> website by free riding on the fame of the DKNY and DKNY Logo trademarks, and that the Disputed Domain Name was therefore registered and is being used in bad faith.
The Respondent did not reply to Complainants' contentions.
The case record contains ample evidence to demonstrate Complainants' rights in the registered DKNY and DKNY Logo trademarks. The Panel also determines that the Disputed Domain Name is confusingly similar to Complainants' DKNY mark. The insertion of the term “party” following the mark does not defeat confusing similarity. See CELLEX-C International Inc. v. Jaye Pharmacy and Absolute Cellex C, WIPO Case No. D2003-0423 (finding that disputed domain name <absolutecellexc.com> is identical or confusing similar to Complainant's mark, “CELLEX-C”). The Panel finds Complainants' cases persuasive on this first element, namely Google, Inc. v. Thilak Raj, Net Jobs, WIPO Case No. D2009-0033, and SAP AG v. Domains by Proxy Inc./Sales, WIPO Case No. D2009-0264. Moreover, to the extent a domain name wholly incorporates a complainant's registered mark, that too is sufficient to establish identity or confusing similarity for purposes of the Policy, despite the addition of other words to such marks. See, e.g., Capital One Financial Corporation v. Ryan Evans, WIPO Case No. D2008-1236. Accordingly, the Panel finds that Complainant has demonstrated the first element.
Paragraph 4(c) of the Policy provides that Respondent may establish rights or legitimate interests in the Disputed Domain Name by proof of any of the following non-exclusive list of circumstances: (i) before any notice to Respondent of the dispute, Respondent used, or made demonstrable preparations to use, the Disputed Domain Name or a name corresponding to the Disputed Domain Name in connection with a bona fide offering of goods or services; or (ii) Respondent (as an individual, business, or other organization) has been commonly known by the Disputed Domain Name, even if Respondent has not acquired trademark or service mark rights; or (iii) Respondent is making a legitimate noncommercial or fair use of the Disputed Domain Name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue. If the circumstances are sufficient to constitute a prima facie showing by the Complainant of an absence of rights or legitimate interests on the part of the Respondent, the evidentiary burden shifts to the Respondent to show, by plausible, concrete evidence, that it does have a right or a legitimate interest.
Complainants have not authorized Respondent to use their DKNY trademark. There is also no evidence that Respondent is commonly known by the Disputed Domain Name, and thus paragraph 4(c)(ii) of the Policy is inapplicable in this case. Further, Respondent does not appear to be using the Disputed Domain Name in connection with any offering of goods or services, much less offerings that could be considered bona fide. Finally, there is no evidence that Respondent is making any legitimate noncommercial or fair use of the Disputed Domain Name. As Complainants point out, the DKNY mark is associated with Donna Karen, a well known and famous individual. A respondent's use of a domain name that is associated with a complainant's name is not a legitimate or fair use of a complainant's mark since it diverts Internet traffic to the respondent's site, thereby potentially depriving complainant of visits by Internet users to its own site. See Monty and Pat Roberts, Inc. v. Bill Keith, WIPO Case No. D2000-0299. Based on the un-refuted evidence submitted with the Complainant, the Panel finds that Respondent is not making fair use of Complainant's wll-known DKNY mark, but is using the mark to attract Internet users to Respondent's website and then providing links to other sites having little or nothing to do with Complainants.
This combination of circumstances sufficiently establishes a prima facie case so that the evidentiary burden shifts to Respondent to prove that it has some right or legitimate interest in respect of the Disputed Domain Name. Respondent has not filed a Response and has therefore failed to satisfy its burden. Having searched the record, the Panel finds no circumstances that would indicate such rights or interests, as described in paragraph 4(c) of the Policy, or otherwise. Complainants have therefore prevailed on this part of their Complaint.
Paragraph 4(a)(iii) of the Policy requires that Complainants establish both bad faith registration and bad faith use of the Disputed Domain Name by Respondent. See World Wrestling Federation Entertainment, Inc. v. Michael Bosman, WIPO Case No. D1999-0001. Paragraph 4(b) of the Policy provides the following four exemplary circumstances, each of which, if proven, shall be evidence of the registration and use of a disputed domain name in bad faith: (i) circumstances indicating that a registrant registered or acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to a complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of the registrant's documented out-of-pocket costs directly related to the domain name; or (ii) the registrant has registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that the registrant has engaged in a pattern of such conduct; or (iii) the registrant has registered the domain name primarily for the purpose of disrupting the business of a competitor; or (iv) by using the domain name, the registrant has intentionally attempted to attract, for commercial gain, Internet users to the registrant's website or other online location, by creating a likelihood of confusion with Complainants' mark as to the source, sponsorship, affiliation, or endorsement of the registrant's website or location or of a product or service on the registrant's website or location.
Complainants have submitted no evidence that Respondent registered the Disputed Domain Name to sell, rent or otherwise transfer it to Complainant, or to a competitor of Complainants, for profit. Paragraph 4(b)(i) of the Policy. Nor is there evidence that Respondent registered the Disputed Domain Name in order to prevent Complainants from reflecting their mark in a corresponding domain name. Paragraph 4(b)(ii) of the Policy.
Nonetheless, when accepting all facts alleged in the Complaint as true, the Panel finds that Complainants have shown registration and use in bad faith by Respondent.
Given Complainants' long and widespread use of its DKNY trademark for clothing and apparel services throughout the world, Respondent was quite likely aware of Complainants at the time it registered the Disputed Domain Name. Accordingly, in the absence of evidence to the contrary, the Panel presumes that Respondent registered the Disputed Domain Name because of its association with Complainant, its reputation, and its business. Respondent, by use of the Disputed Domain Name, draws Internet users away from Complainants websites to its own website and thus damages Complainants' business. Accordingly, the Panel finds that Respondent registered the Disputed Domain Name primarily for the purpose of disrupting the business of a competitor or for attracting Internet users to another site by creating confusion and this is evidence of bad faith under paragraphs 4(b)(iii) and (iv) of the Policy.
Further, when a company's famous trademark is registered as a domain name by a party with no connection with the company or its products, a Panel may find bad faith registration and use. The cases cited by Complainants on this point are persuasive. Donna Karen Studio v. Donn, WIPO Case No. D2001-0587 (domain name was registered in bad faith where Respondent had no rights to name and “should have known of Complainant's [DKNY] mark given its widespread use and notoriety”); Chanel, Inc. v. Buybeautycom, WIPO Case No. D2000-1126 (“Given that Respondent has no connection with Complainant and has never been authorized by Complainant to use the CHANEL mark, the very fact that Respondent has registered <buychanel.com> established bad faith use and registration”); Guerlain S.A. v. SL Blancel Web, WIPO Case No. D2000-1191 (respondent's incorporation of famous trademark GUERLAIN into domain name <misguerlain.com> “cannot be the result of mere coincidence” and respondent “could not possibly make any plausible actual or contemplated active use” other than in bad faith); Parfums Christian Dior v. Javier Garcia, WIPO Case No. D2000-0226 (finding “opportunistic bad faith” where respondent registered domain names <christiandior.com> and <christiandior.net>); Veuve Cliquot Ponsardin, Maison Fondée en 1772 v. The Polygenix Group Co., WIPO Case No. D2000-0163 (finding bad faith where the domain name “is so obviously connected with such a well-known product that its very use by someone with no connection with the product suggests opportunistic bad faith”).
The fact that Complainants have United States registered trademarks and the Respondent is located in the United States further support a finding of registration and/or use in bad faith in this case. In a case where the complainant's trademark registration preceded the respondent's domain name registration , respondent was presumed to have notice of the trademark. See Kate Spade, LLC v. Darmstadter Designs, WIPO Decision No. D2001-1384. Accordingly, under the circumstances, the Panel determines that Respondent acted in bad faith in registering and using the Disputed Domain Name.
For all the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the Disputed Domain Name <dknyparty.com> be transferred to the Complainants.

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64 USLW 2274, 28 Bankr.Ct.Dec. 23, Bankr.
In re Edwin Leo VANN, Debtor.
Charles Franklin Ketchey, Jr., Jonathan J. Ellis, Judith A. English, Ketchey, Horan, Hearn, Neukamm & Baumann, P.A., Tampa, FL, for appellant.
Josiah Ewing Hutton, Jr., Winter Haven, FL, for appellee.
Before TJOFLAT, Chief Judge, BIRCH, Circuit Judge, and HENDERSON, Senior Circuit Judge.
This appeal presents the first impression issue of what standard of reliance a creditor must satisfy under section 523(a)(2)(A) of the Bankruptcy Code to prevent the discharge of a debt. The bankruptcy court held that a creditor's reliance on the debtor's misrepresentations must be reasonable. The court rejected the creditor's claim that reasonable reliance was an overly stringent standard or, alternatively, that its reliance met the reasonable reliance standard. The district court summarily affirmed; we REVERSE and REMAND for further factfinding.
In 1985, defendant-appellee, Edwin L. Vann, sought credit from plaintiff-appellant, City Bank & Trust Company ("City Bank") for the opening of a cheese processing plant in Tennessee. Vann submitted a financial statement to City Bank, which sent a representative to visit Vann at his home in Florida to investigate the real estate holdings and other properties relied upon by Vann to support the extension of credit. Between the initiation of credit negotiations and the eventual closing of the loan, Vann's financial condition deteriorated. City Bank did not request updated financial information from Vann prior to the closing of the loan, and Vann did not disclose these changes despite representations in the loan documents that no changes had occurred. Vann subsequently filed bankruptcy under Chapter 11.
City Bank filed an adversary proceeding challenging the dischargeability of Vann's debt to it. City Bank charged that Vann obtained the credit by false pretenses, false representations, or actual fraud under section 523(a)(2)(A), and that it reasonably relied on Vann's financial statement, which was materially false under section 523(a)(2)(B).1 The bankruptcy court concluded that (1) although the bank had been "hoodwinked" by Vann, there was no actual fraud, (2) even if there were false pretenses or false representations under section 523(a)(2)(A), City Bank was required to show reasonable reliance on Vann's representations and it failed to meet that standard; and (3) City Bank's reliance on Vann's materially false financial statement was unreasonable. R1-1-90-297 (Trans. of Proceedings).
Upon City Bank's motion for further findings of fact and conclusions of law as to its section 523(a)(2)(A) claim, the bankruptcy court held that City Bank's reliance must be reasonable under both section 523(a)(2)(A) and section 523(a)(2)(B). Therefore, it denied City Bank's motion and entered judgment in the adversary proceeding for Vann. The district court summarily affirmed the bankruptcy court. Because we conclude that, in contrast to section 523(a)(2)(B), section 523(a)(2)(A) does not require the creditor to show reasonable reliance on the debtor's representations, we REVERSE and REMAND.
[t]his standard of reasonableness places a measure of responsibility upon a creditor to ensure that there exists some basis for relying upon the debtor's representations. Of course, the reasonableness of a creditor's reliance will be evaluated according to the particular facts and circumstances present in a given case.
First Bank v. Mullet (In re Mullet), 817 F.2d 677, 679 (10th Cir.1987). The Tenth Circuit concluded that the bank's failure to investigate precluded reasonable reliance. Id. at 681-82.
whether there had been previous business dealings with the debtor that gave rise to a relationship of trust; whether there were any "red flags" that would have alerted an ordinarily prudent lender to the possibility that the representations relied upon were not accurate; and whether even minimal investigation would have revealed the inaccuracy of the debtor's representations.
Although section 523(a)(2)(A) is silent with respect to the standard of reliance, its companion section 523(a)(2)(B) is not. Subsection (B) states prominently that the creditor's reliance on the debtor's statement must have been reasonable. We thus begin with the basic premise of statutory construction that " ' "[w]here Congress includes particular language in one section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts intentionally and purposely in the disparate inclusion or exclusion." ' " Rodriguez v. United States, 480 U.S. 522, 525, 107 S.Ct. 1391, 1393, 94 L.Ed.2d 533 (1987) (per curiam) (quoting Russello v. United States, 464 U.S. 16, 23, 104 S.Ct. 296, 300, 78 L.Ed.2d 17 (1983)); accord In re Haas, 48 F.3d at 1156-57; United States v. Jordan, 915 F.2d 622, 628 (11th Cir.1990), cert. denied, 499 U.S. 979, 111 S.Ct. 1629, 113 L.Ed.2d 725 (1991). Vann has pointed to no authority supporting the concept that Congress specifically intended for a reasonable reliance standard to apply. Thus, we can deduce from the exclusion of the reasonable reliance standard in the section immediately preceding section 523(a)(2)(B) only that some other standard than reasonable was intended by the legislature. Cf. In re Ophaug, 827 F.2d at 343 (relying on the purpose behind subsection (B) to conclude "having no reason to think that Congress meant anything other than what it said, we can only conclude that section 523(a)(2)(A) does not require a creditor to prove that his reliance on the debtor's fraudulent misrepresentations was reasonable").
Because Congress failed to provide the standard of reliance in section 523(a)(2)(A), we look to the legislative history of that section to determine whether Congress's intent can be ascertained there. Sections 523(a)(2) of the 1978 Bankruptcy Code embodied the revision of Bankruptcy Act section 17(2). Although there is little information concerning the passage of section 523(a)(2)(A), specifically, it is clear that Congress intended the reasonable reliance standard only for a nondischargeability claim made pursuant to section 523(a)(2)(B). The House of Representatives Report on the Bankruptcy Code of 1978 contained a lengthy statement regarding the use of false financial statements to obtain money, property, services, or credit. See H.R.Rep. No. 595, 95th Cong., 1st Sess. 129-32 (1977), reprinted in 1978 U.S.C.C.A.N. 5963, 6090-93. Section 523(a)(2)(B) specifically was enacted to protect consumers against "abuse in consumer cases," and to guard "the fresh start goal of the bankruptcy discharge." Id. at 130, 1978 U.S.C.C.A.N. at 6091 (emphasis added). The report, where discussing the effect of false financial statements, states in pertinent part: "[t]he difference[ ] [is] that current law ... requires only reliance, not reasonable reliance, by the creditor on the statement. The courts have recently begun to require that the reliance be reasonable, however." Id. Nowhere in the report is a reference made to a requirement of reasonable reliance to prevent discharge on the basis of unwritten false statements.6 Thus, our conclusion that only section 523(a)(2)(B) requires reasonable reliance is fortified.
(b) his reliance is justifiable.
Restatement (Second) of Torts Sec. 537 (1977) (emphasis added).
Another generally recognized authority, Prosser & Keeton on Torts, states that "[n]ot only must there be reliance but the reliance must be justifiable under the circumstances." W. Page Keeton, Prosser & Keeton on Torts Sec. 108, at 749 (5th ed. 1984). The justifiability requirement provides "some objective corroboration to plaintiff's claim that he did rely." Id. at 750.
[i]t is only where, under the circumstances, the facts should be apparent to one of [plaintiff's] knowledge and intelligence from a cursory glance, or he has discovered something which should serve as a warning that he is being deceived, that he is required to make an investigation of his own.
Id. at 752 (footnotes omitted); see also Mayer v. Spanel Int'l Ltd. (In re Mayer), 51 F.3d 670, 676 (7th Cir.1995) ("A victim who lacks access to the truth, and has not been alerted to the facts that would alert him to the truth, is not to be ... blocked by a discharge under the bankruptcy laws--just because he did not conduct a more thorough investigation."). Under the common law, a person was not barred from recovery because he failed to undertake an investigation of the truth of a misrepresentation even where "the reasonable man of ordinary caution would do so." Restatement (Second) of Torts Sec. 545A cmt. b. This subjective construction is consistent with the Supreme Court's interpretation of the statutory purpose. See Grogan v. Garner, 498 U.S. 279, 287, 111 S.Ct. 654, 659, 112 L.Ed.2d 755 (1991) ("We think it unlikely that Congress ... would have favored the interest in giving perpetrators of fraud a fresh start over the interest in protecting victims of fraud."). Thus, we adopt the standard of justifiable reliance.
The bankruptcy court embraced the reasonable reliance standard as stated by the Tenth Circuit and concluded that the bank would have been "better served by demanding an appraisal," of certain property and should have made other inquiries of the debtor to ascertain the status of other properties. R1-1-90-292. The court found that because the bank failed to do so, it was not entitled to discharge on the basis of either section 523(a)(2)(A) or section 523(a)(2)(B). Although the bankruptcy court, with hindsight, can see plainly that the bank would have been "better served by demanding an appraisal" and by making further inquiries of the debtor, even the cases upon which the court relied admonish that the court should not " 'second guess a creditor's decision to make a loan' " or " 'base its decision regarding discharge on whether it would have extended the loan.' " In re Mullet, 817 F.2d at 681 (quoting Northern Trust Co. v. Garman (In re Garman), 643 F.2d 1252, 1258 (7th Cir.1980) (interpreting section 17(2) of the Bankruptcy Act), cert. denied, 450 U.S. 910, 101 S.Ct. 1347, 67 L.Ed.2d 333 (1981)).
By adopting the standard of justifiable reliance, we necessarily reject the standard of actual reliance employed by the Eighth Circuit in In re Ophaug and the Fifth Circuit in In re Allison. It cannot be argued that a standard of actual reliance is supported by the plain language of the statute. Section 523(a)(2)(A) does not mention reliance in any form and, to the extent that reliance is required, it is as an element of actual fraud, false pretenses or false representations that must be proven to prevent discharge of the debt. Moreover, a standard of actual reliance does not "reflect a fair balance between the[ ] conflicting interests" of discouraging fraud and of providing the honest but unfortunate debtor a fresh start that are present in the dischargeability provisions. Grogan, 498 U.S. at 287, 111 S.Ct. at 659. A standard of actual reliance requires little of the creditor; whereas, justifiable reliance requires the creditor to act appropriately according to his individual circumstances. Therefore, the fresh start policy of the Bankruptcy Code is intact while fraudulent debtors are precluded from profiting from their misdeeds.
With respect to section 523(a)(2)(A), the bankruptcy court found that, although Vann "hoodwinked" City Bank, there was no actual fraud in Vann's obtaining the loan from City Bank. R1-1-90-297. The bankruptcy court, however, refused to make any additional factfinding to assist our review. If Vann obtained the loan from City Bank by false pretenses or by a false representation, and if City Bank justifiably relied on his misrepresentations, then Vann is not entitled to discharge of that debt. City Bank is not required to prove that it reasonably relied on Vann's misrepresentations.
This appeal required us to decide the standard of reliance that a creditor must satisfy under section 523(a)(2)(A) of the Bankruptcy Code to prevent discharge of a debt. We have determined that standard to be justifiable reliance. Because the bankruptcy court did not make sufficient factfindings for our review, we REVERSE and REMAND to the district court with instructions to remand to the bankruptcy court for proceedings consistent with this opinion.
will not be discharged in bankruptcy.
11 U.S.C. Sec. 523(a)(2) (emphasis added).
[I]t is a fundamental principle of the law of fraud throughout the United States, regardless of the form of relief sought, that in order to secure redress, the representee (person to whom or which the misrepresentation was made) must have relied upon the statement or representation as an inducement to his action or injurious change of position. As the general American law declares, a representation must have been acted upon in the manner contemplated by the party making it, or else in some manner reasonably probable.
Stuart M. Speiser, Charles F. Krause, & Alfred W. Gans, 9 American Law of Torts Sec. 32:49 (1992).
For purposes of Sec. 523(a)(2)(A), a creditor must prove that (1) the debtor made a false representation with intent to deceive the creditor, (2) the creditor relied on the representation, (3) that his reliance was reasonably founded, and (4) that the creditor sustained loss as a result of the representation.
Id. at 676 (emphasis added). Indeed, we have stated that a creditor's reliance must be "reasonably founded." See id.; In re Hunter, 780 F.2d at 1579. Vann contends that because In re St. Laurent was addressing the application of collateral estoppel to Sec. 523(a)(2)(A), our statement regarding "reasonably founded" is binding on us.
We do not view In re St. Laurent as having this effect. Our finding that collateral estoppel precluded the bankruptcy court from relitigating fraud was based on our conclusion that the "elements of common law fraud in Florida ' "closely mirror" the requirements of section 523(a)(2)(A) and, hence, are "sufficiently identical ... to meet the first prong of the test for collateral estoppel." ' " In re St. Laurent, 991 F.2d at 676 (omission in original) (quoting In re Jolly, 124 B.R. 365, 367 (Bankr.M.D.Fla.1991)). Moreover, the Florida standard of reliance that we cited in In re St. Laurent was actual reliance. Id. at 676 ("To prove fraud under Florida law, a plaintiff must establish that the defendant made a 'deliberate and knowing misrepresentation designed to cause, and actually causing detrimental reliance by the plaintiff.' " (quoting First Interstate Dev. Corp. v. Ablanedo, 511 So.2d 536, 539 (Fla.1987) (emphasis added)). In In re Hunter, we concluded that there were no false representations or false pretenses, and, accordingly, we never reached the issue of reliance. In re Hunter, 780 F.2d at 1580. We made no statement in In re St. Laurent or in In re Hunter defining "reasonably founded," and we refuse to be bound by dicta. See New Port Largo, Inc. v. Monroe County, 985 F.2d 1488, 1500 n. 7 ("For good or for bad, opinion-writing judges--unlike legislators--can make cases decide no more than the cases present. For example, no matter how often or how plainly a judicial panel may put in its opinion that 'we hold X,' 'X' is not law and is not binding on later panels unless 'X' was squarely presented by the facts of the case and was a proposition that absolutely must have been decided to decide the concrete case then before the court.") (Edmondson, J., concurring), cert. denied, --- U.S. ----, 114 S.Ct. 439, 126 L.Ed.2d 373 (1993). Hence, we now address for the first time directly what standard of reliance is required under Sec. 523(a)(2)(A).

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