text:
Under Alabama law felony murder is a lesser included offense of the capital crime of robbery-intentional killing. Under the Alabama death penalty statute the trial judge is prohibited from giving the jury the option of convicting the defendant of the lesser included offense; instead, the jury must either convict the defendant of the capital crime, in which case it must impose the death penalty, or acquit him. If the defendant is convicted, the trial judge must hold a hearing to consider aggravating and mitigating circumstances, and may then refuse to impose the death sentence and instead sentence the defendant to life imprisonment. Petitioner was convicted of robbery-intentional killing, and the jury accordingly imposed the death sentence, which the Alabama trial court refused to overturn. At petitioner's trial, his own testimony established his participation in the robbery, but he denied killing, or any intent to kill, the victim. Because of the statutory prohibition, the trial court did not instruct the jury as to the lesser included offense of felony murder. The Alabama appellate courts upheld the conviction and death sentence, rejecting petitioner's constitutional attack on the statutory prohibition on lesser included offense instructions.
The death sentence may not constitutionally be imposed after a jury verdict of guilt of a capital offense where the jury was not permitted to consider a verdict of guilt of a lesser included offense. Pp. 633-646.
(a) Providing the jury with the "third option" of convicting on a lesser included offense ensures that the jury will accord the defendant the full benefit of the reasonable-doubt standard. This procedural safeguard is especially important in cases such as this one. For when the evidence establishes that the defendant is guilty of a serious, violent offense but leaves some doubt as to an element justifying conviction of a capital offense, the failure to give the jury such a "third option" inevitably enhances the risk of an unwarranted conviction. Such a risk cannot be tolerated in a case in which the defendant's life is at stake. Pp. 633-638.
(b) Alabama's argument that, in the context of an apparently mandatory death penalty statute, the preclusion of lesser included offense instructions heightens, rather than diminishes, the reliability of the guilt determination, must be rejected. The unavailability of lesser included [447 U.S. 625, 626] offense instructions and the apparently mandatory nature of the death penalty both interject irrelevant considerations into the factfinding process, diverting the jury's attention from the central issue of whether the State has satisfied its burden of proving beyond a reasonable doubt that the defendant is guilty of a capital crime. Thus, on the one hand, the unavailability of the "third option" may encourage the jury to convict for an impermissible reason - its belief that the defendant is guilty of some serious crime and should be punished. On the other hand, the apparently mandatory nature of the death penalty may encourage the jury to acquit for an equally impermissible reason - that, whatever his crime, the defendant does not deserve death. While in any particular case these two extraneous factors may favor the defendant or the prosecution or may cancel each other out, in every case they introduce a level of uncertainty and unreliability into the factfinding process that cannot be tolerated in a capital case. Pp. 638-643.
(c) The jury's "option" of refusing to return any verdict at all, thus causing a mistrial, is not an adequate substitute for proper instructions on lesser included offenses. Nor does the fact that the trial judge has the ultimate sentencing power compensate for the risk that the jury may return an improper verdict because of the unavailability of the "third option." If the jury finds the defendant guilty only of a lesser included offense, the judge would not have the opportunity to impose the death sentence. Moreover, the jury's verdict must have a tendency to motivate the judge to impose the same sentence that the jury did. Under these circumstances, it cannot be presumed that a post-trial hearing will always correct whatever mistakes occurred in the performance of the jury's factfinding function. Pp. 643-646.
STEVENS, J., delivered the opinion of the Court, in which BURGER, C. J., and BRENNAN, STEWART, BLACKMUN, and POWELL, JJ., joined. BRENNAN, J., filed a concurring opinion, post, p. 646. MARSHALL, J., filed an opinion concurring in the judgment, post, p. 646. REHNQUIST, J., filed a dissenting opinion, in which WHITE, J., joined, post, p. 646.
David Klingsberg argued the cause for petitioner. With him on the briefs were John A. Herfort, Jay Wishingrad, and John L. Carroll.
"May a sentence of death constitutionally be imposed after a jury verdict of guilt of a capital offense, when the jury was not permitted to consider a verdict of guilt of a lesser included non-capital offense, and when the evidence would have supported such a verdict?" 444 U.S. 897 .
We now hold that the death penalty may not be imposed under these circumstances.
Because of the statutory prohibition, the court did not instruct the jury as to the lesser included offense of felony murder. Instead, the jury was told that if petitioner was acquitted of the capital crime of intentional killing in the course of a robbery, he "must be discharged" and "he can never be tried for anything that he ever did to Roy Malone." Record 743. The jury subsequently convicted petitioner and imposed the death penalty; after holding a hearing with respect to aggravating and mitigating factors, the trial court refused to overturn that penalty.
In the courts below petitioner attacked the prohibition on lesser included offense instructions in capital cases, arguing that the Alabama statute was constitutionally indistinguishable from the mandatory death penalty statutes struck down in Woodson v. North Carolina, 428 U.S. 280 , and Roberts v. Louisiana, 428 U.S. 325 . 6 The Alabama Court of Criminal [447 U.S. 625, 631] Appeals rejected this argument on the ground that the jury's only function under the Alabama statute is to determine guilt or innocence and that the death sentence it is required [447 U.S. 625, 632] to impose after a finding of guilt is merely advisory. 7 In a brief opinion denying review, the Alabama Supreme Court also rejected petitioner's arguments, citing Jacobs v. State, 361 So.2d 640 (Ala. 1978), cert. denied, 439 U.S. 1122 , in which it had upheld the constitutionality of the Alabama death penalty statute against a similar challenge. 365 So.2d 1006, 1007 (1978).
In this Court petitioner contends that the prohibition on giving lesser included offense instructions in capital cases violates both the Eighth Amendment as made applicable to the States by the Fourteenth Amendment and the Due Process Clause of the Fourteenth Amendment by substantially increasing the risk of error in the factfinding process. Petitioner argues that, in a case in which the evidence clearly establishes the defendant's guilt of a serious noncapital crime such as felony murder, forcing the jury to choose between conviction on the capital offense and acquittal creates a danger that it will resolve any doubts in favor of conviction. 8 [447 U.S. 625, 633] In response, Alabama argues that the preclusion of lesser included offense instructions does not impair the reliability of the factfinding process or prejudice the defendant in any way. Rather, it argues that the apparently mandatory death penalty will make the jury more prone to acquit in a doubtful case and that the jury's ability to force a mistrial by refusing to return a verdict acts as a viable third option in a case in which the jury has doubts but is nevertheless unwilling to acquit. The State also contends that prohibiting lesser included offense instructions is a reasonable way of assuring that the death penalty is not imposed arbitrarily and capriciously as a result of compromise verdicts. Finally, it argues that any error in the imposition of the death penalty by the jury can be cured by the judge after a hearing on aggravating and mitigating circumstances.
"Moreover, it is no answer to petitioner's demand for a jury instruction on a lesser offense to argue that a defendant may be better off without such an instruction. True, if the prosecution has not established beyond a reasonable doubt every element of the offense charged, and if no lesser offense instruction is offered, the jury must, as a theoretical matter, return a verdict of acquittal. But a defendant is entitled to a lesser offense instruction - in this context or any other - precisely because he should not be exposed to the substantial risk that the jury's practice will diverge from theory. Where one of the elements of the offense charged remains in doubt, but the defendant is plainly guilty of some offense, the jury is likely to resolve its doubts in favor of conviction. In the case before us, for example, an intent to commit serious bodily injury is a necessary element of the crime with which petitioner was charged, but not of the crime of simple assault. Since the nature of petitioner's intent was very much in dispute at trial, the jury could rationally have convicted him of simple assault if that option had been presented. But the jury was presented with only two options: convicting the defendant of assault with intent to commit great bodily injury, or acquitting him outright. We cannot say that the availability of a third option - convicting the defendant of simple assault - could not have resulted in a different verdict. Indeed, while we have never explicitly held that the Due Process Clause of the Fifth Amendment guarantees the right of a defendant to have the jury instructed on a lesser included offense, it is nevertheless clear that a construction of the Major Crimes Act to preclude such an [447 U.S. 625, 635] instruction would raise difficult constitutional questions." Id., at 212-213 (emphasis in original).
Alabama's failure to afford capital defendants the protection provided by lesser included offense instructions is unique in American criminal law. 10 In the federal courts, it has long been "beyond dispute that the defendant is entitled to an instruction on a lesser included offense if the evidence would permit a jury rationally to find him guilty of the lesser offense and acquit him of the greater." Keeble v. United States, supra, at 208. 11 Similarly, the state courts that have addressed [447 U.S. 625, 636] the issue have unanimously held that a defendant is entitled to a lesser included offense instruction where the evidence warrants it. 12 Indeed, for all noncapital crimes [447 U.S. 625, 637] Alabama itself gives the defendant a right to such instructions under appropriate circumstances. See n. 5, supra.
While we have never held that a defendant is entitled to a lesser included offense instruction as a matter of due process, the nearly universal acceptance of the rule in both state and federal courts establishes the value to the defendant of this procedural safeguard. That safeguard would seem to be especially important in a case such as this. For when the evidence unquestionably establishes that the defendant is guilty of a serious, violent offense - but leaves some doubt with respect to an element that would justify conviction of a capital offense - the failure to give the jury the "third option" of convicting on a lesser included offense would seem inevitably to enhance the risk of an unwarranted conviction.
"[D]eath is a different kind of punishment from any other which may be imposed in this country. . . . From the point of view of the defendant, it is different in both its severity and its finality. From the point of view of society, the action of the sovereign in taking the life of one of its citizens also differs dramatically from any other legitimate state action. It is of vital importance to the defendant and to the community that any decision to impose the death sentence be, and appear to be, based on [447 U.S. 625, 638] reason rather than caprice or emotion." Gardner v. Florida, 430 U.S. 349, 357 -358 (opinion of STEVENS, J.).
Alabama argues, however, that petitioner's factual premise is wrong and that, in the context of an apparently mandatory [447 U.S. 625, 639] death penalty statute, the preclusion of lesser included offense instructions heightens, rather than diminishes, the reliability of the guilt determination. The State argues that, because the jury is led to believe that a death sentence will automatically follow a finding of guilt, 15 it will be more likely to acquit than to convict whenever it has anything approaching a reasonable doubt. In support of this theory the State relies on the historical data described in Woodson v. North Carolina, 428 U.S., at 293 (opinion of STEWART, POWELL, and STEVENS, JJ.), which indicated that American juries have traditionally been so reluctant to impose the death penalty that they have "with some regularity, disregarded their oaths and refused to convict defendants where a death sentence was the automatic consequence of a guilty verdict."
The Alabama statute, which was enacted after Furman but before Woodson, has many of the same flaws that made the North Carolina statute unconstitutional. Thus, the Alabama statute makes the guilt determination depend, at least in part, on the jury's feelings as to whether or not the defendant deserves the death penalty, without giving the jury any standards to guide its decision on this issue.
"The Supreme Court of the United States did remark in Furman, infra, and again in Woodson, supra, that this nation abhorred the mandatory death sentence. . . . I suggest that, although there is no historical data to support it, most, if not all, jurors at this point in our history perhaps equally abhor setting free a defendant where the evidence establishes his guilt of a serious crime. We have no way of knowing what influence either of these factors have on a jury's deliberation, and which of these unappealing alternatives a jury opts for in a particular case is a matter of purest conjecture. We cannot know that one outweighs the other. Jurors are not expected to come into the jury box and leave behind all that their human experience has taught them. The increasing crime rate in this country is a source of concern to all Americans. To expect a jury to ignore this reality and to find a defendant innocent and thereby set him free when the evidence establishes beyond doubt that he is guilty of some violent crime requires of our juries clinical detachment from the reality of human experience. . . ."
In the final analysis the difficulty with the Alabama statute is that it interjects irrelevant considerations into the factfinding process, diverting the jury's attention from the central issue of whether the State has satisfied its burden of proving beyond a reasonable doubt that the defendant is guilt of a capital crime. Thus, on the one hand, the unavailability of the third option of convicting on a lesser included offense may encourage the jury to convict for an impermissible reason - its belief that the defendant is guilty of some serious crime and should be punished. On the other hand, the apparently mandatory nature of the death penalty may encourage it to [447 U.S. 625, 643] acquit for an equally impermissible reason - that, whatever his crime, the defendant does not deserve death. 19 In any particular case these two extraneous factors may favor the defendant or the prosecution or they may cancel each other out. But in every case they introduce a level of uncertainty and unreliability into the factfinding process that cannot be tolerated in a capital case.
The State also argues that, whatever the effect of precluding lesser included offense instructions might otherwise be, there is no possibility of harm under the Alabama statute because of two additional safeguards. First, although the jury may not convict the defendant of a lesser included offense, the State argues that it may refuse to return any verdict at all in a doubtful case, thus creating a mistrial. After a mistrial, the State may reindict on the capital offense or on lesser included offenses. 20 In this case the jury was instructed [447 U.S. 625, 644] that a mistrial would be declared if it was unable to agree on a verdict or if it was unable to agree on fixing the death penalty; it was also told that, in the event of a mistrial, the defendant could be tried again. Record 743.
We are not persuaded by the State's argument that the mistrial "option" is an adequate substitute for proper instructions on lesser included offenses. It is extremely doubtful that juries will understand the full implications of a mistrial 21 or will have any confidence that their choice of the mistrial option will ultimately lead to the right result. Thus, they could have no assurance that a second trial would end in the conviction of the defendant on a lesser included offense. Moreover, invoking the mistrial option in a case in which the jury agrees that the defendant is guilty of some offense, though not the offense charged, would require the jurors to violate their oaths to acquit in a proper case - contrary to the State's assertions that juries should not be expected to make such lawless choices. Finally, the fact that lesser included offense instructions have traditionally been given in noncapital cases despite the availability of the mistrial "option" [447 U.S. 625, 645] indicates that such instructions provide a necessary additional measure of protection for the defendant.
The State's second argument is that, even if a defendant is erroneously convicted, the fact that the judge has the ultimate sentencing power will ensure that he is not improperly sentenced to death. Again, we are not persuaded that sentencing by the judge compensates for the risk that the jury may return an improper verdict because of the unavailability of a "third option."
If a fully instructed jury would find the defendant guilty only of a lesser, noncapital offense, the judge would not have the opportunity to impose the death sentence. Moreover, it is manifest that the jury's verdict must have a tendency to motivate the judge to impose the same sentence that the jury did. Indeed, according to statistics submitted by the State's Attorney General, it is fair to infer that the jury verdict will ordinarily be followed by the judge even though he must hold a separate hearing in aggravation and mitigation before he imposes sentence. 22 Under these circumstances, we are unwilling to presume that a post-trial hearing will always correct [447 U.S. 625, 646] whatever mistakes have occurred in the performance of the jury's factfinding function.
"(14) Murder when perpetrated against any witness subpoenaed to testify at any preliminary hearing, trial or grand jury proceeding against the defendant who kills or procures the killing of witness, or when perpetrated against any human being while intending to kill such witness."
[ Footnote 2 ] Alabama Code 13-11-2 (b) (1975) states that "[e]vidence of intent under this section shall not be supplied by the felony-murder doctrine." In Ritter v. State, 375 So.2d 270, 275 (1979), cert. pending, No. 79-5741, the Alabama Supreme Court held that the State could not satisfy its burden of proof under the new death penalty statute simply by showing that the defendant intended to commit robbery or even by showing that he should have known that there was a substantial possibility that someone would be killed. Although the State is not required to prove that the defendant was the actual triggerman, it must show that he had a "particularized intent" to kill the victim or that he "sanctioned and facilitated the crime [of intentional killing] so that his culpability is comparable to that of" the actual killer.
"If the jury finds the defendant guilty, it shall fix the punishment at death when the defendant is charged by indictment with any of the [447 U.S. 625, 629] following offenses and with aggravation, which must also be averred in the indictment, and which offenses so charged with said aggravation shall not include any lesser offenses."
The last phrase of this subsection has been consistently construed to preclude any lesser included offense instructions in capital cases. See Jacobs v. State, 361 So.2d 640, 646 (Ala. 1978) (Torbert, C. J., concurring in part and dissenting in part), cert. denied, 439 U.S. 1122 ; Evans v. Birtton, 472 F. Supp. 707, 714 (SD Ala. 1979).
"If the jury finds the defendant guilty of one of the aggravated offenses listed in section 13-11-2 and fixes the punishment at death, the court shall thereupon hold a hearing to aid the court to determine whether or not the court will sentence the defendant to death or to life imprisonment without parole. In the hearing, evidence may be presented as to any matter that the court deems relevant to sentence and shall include any matters relating to any of the aggravating or mitigating circumstances enumerated in sections 13-11-6 and 13-11-7. Any such evidence which the court deems to have probative value may be received, regardless of its admissibility under the exclusionary rules of evidence, provided that the defendant is accorded a fair opportunity to rebut any hearsay statements; provided further, that this section shall not be construed to authorize the introduction of any evidence secured in violation of the Constitution of the United States or the state of Alabama. The state and the defendant, or his counsel, shall be permitted to present argument for or against the sentence of death."
[ Footnote 5 ] The Alabama rule in cases other than capital cases is that the defendant is entitled to a lesser included offense instruction if "there is any reasonable theory from the evidence which would support the position." Fulghum v. State, 291 Ala. 71, 75, 277 So.2d 886, 890 (1973). The State concedes that under this standard petitioner would have been entitled to instructions on first-degree (felony) murder and robbery. Brief for Respondent 78-79; Tr. of Oral Arg. 23. The parties disagree as to whether petitioner also would have been entitled to an instruction on second-degree murder under state law. We, of course, have no occasion to pass on this issue.
"The trial jury cannot be instructed on lesser included offenses.
"In the absence of such a provision, the appellant insists that the only choice that a petit jury has is imposing death or acquitting the defendant. He states that because only those two choices are presented to the jury, the statute can only be interpreted as having a mandatory death provision." 365 So.2d 985, 999 (1978).
In his petition for certiorari to the Alabama Supreme Court petitioner specifically stated that he was challenging the Alabama statute as being in violation of the Eighth, Sixth, and Fourteenth Amendments to the United States Constitution and argued that it is "in fact a mandatory death sentence." However, petitioner did not explore these issues more fully in his brief to the Alabama Supreme Court, Tr. of Oral Arg. 5, and, in its one-paragraph opinion affirming the judgment of the Alabama Court of Criminal Appeals, the Supreme Court adverted only to the state constitutional issues petitioner had raised.
In his dissenting opinion MR. JUSTICE REHNQUIST takes the position that we are required to construe the Alabama Supreme Court's failure to address petitioner's federal constitutional claims as a determination that petitioner had waived those claims. We disagree. It is clear that petitioner did present his federal claims in some fashion to the Alabama Supreme Court. The State has never argued that this presentation was insufficient, as a matter of state law, to preserve the issue. On the contrary, in its brief in opposition to the petition for certiorari, the State argued that "the Alabama Appellate Courts have reviewed these matters raised in the petition, fully considered them and correctly decided the issues." Similarly, after certiorari was granted, the State again did not argue that petitioner's due process and Eighth Amendment claims were not properly raised or preserved below.
While the parties of course cannot confer jurisdiction on this Court by agreement, we should not simply brush aside the Alabama Attorney General's view of his own State's law. Cf. Chambers v. Mississippi, 410 U.S. 284, 290 , n. 3. That is especially true in a case such as this, where the death penalty was imposed in a plainly unconstitutional manner. Cf. Vachon v. New Hampshire, 414 U.S. 478 .
[ Footnote 7 ] 365 So.2d, at 1000. The Alabama Court of Criminal Appeals relied on Jacobs v. State, 361 So.2d 640 (Ala. 1978), cert. denied, 439 U.S. 1122 , for this proposition. The majority in Jacobs did not specifically discuss the validity of the prohibition on lesser included offense instructions. However, in an opinion concurring in part and dissenting in part, Chief Justice Torbert stated that, far from being suspect, the prohibition helped to save the statute from being an unconstitutional mandatory death penalty. He noted that in Roberts v. Louisiana, 428 U.S. 325 , this Court had struck down a mandatory death penalty statute which required the judge to give the jury the option of convicting on lesser included offenses whether or not such instructions were warranted by the evidence, on the ground that such a statute gave the jury de facto, standardless sentencing discretion. Because Alabama's statute withdraws from the jury the discretion to control the imposition of the death penalty by convicting the defendant on a lesser included offense and because it is the judge and not the jury who does the actual sentencing, the chief justice concluded that the statute was acceptable as a matter of federal constitutional law.
[ Footnote 8 ] Petitioner also argues that, because Alabama law requires a trial judge to give lesser included offense instructions where appropriate in noncapital cases, the total prohibition on such instructions in capital cases constitutes [447 U.S. 625, 633] an irrational discrimination violative of the Equal Protection Clause of the Fourteenth Amendment. In view of our disposition of the case, it is not necessary to consider this issue. Moreover, petitioner failed to raise this claim in the courts below.
[ Footnote 9 ] 2 M. Hale, Pleas of the Crown 301-302 (1736); 2 W. Hawkins, Pleas of the Crown 623 (6th ed. 1787); 1 J. Chitty, Criminal Law 250 (5th Am. ed. 1847); T. Starkie, Treatise on Criminal Pleading 351-352 (2d ed. 1822).
[ Footnote 10 ] Mississippi's post-Furman death penalty statute also contained a prohibition on charging lesser included offenses. In Jackson v. State, 337 So.2d 1242, 1255 (1976), the Mississippi Supreme Court struck down this part of the statute on the ground that it "constitutes an impediment to full and complete administration of justice in the trial of capital cases and is therefore not binding on the courts. . . ." While warning that lesser included offense instructions should not be given "indiscriminately or automatically," the court held that they should continue to be given when "warranted by the evidence."
"A judge may be entirely satisfied from the whole evidence in the case that the person doing the killing was actuated by malice; that he was not in any such passion as to lower the grade of the crime from murder to manslaughter by reason of any absence of malice; and yet if there be any evidence fairly tending to bear upon the issue of manslaughter, it is the province of the jury to determine from all the evidence what the condition of mind was, and to say whether the crime was murder or manslaughter."
"In a case where some of the elements of the crime charged themselves constitute a lesser crime, the defendant, if the evidence justified it, would no doubt be entitled to an instruction which would permit a finding of guilt of the lesser offense. See Stevenson v. United States, 162 U.S. 313 ." Rule 31 (c) of the Federal Rules of Criminal Procedure provides that "[t]he defendant may be found guilty of an offense necessarily included [447 U.S. 625, 636] in the offense charged. . . ." Although the Rule is permissively phrased, it has been universally interpreted as granting a defendant a right to a requested lesser included offense instruction if the evidence warrants it. See, e. g., United States v. Scharf, 558 F.2d 498, 502 (CA8 1977); United States v. Crutchfield, 547 F.2d 496, 500 (CA9 1977); Government of Virgin Islands v. Carmona, 422 F.2d 95, 100 (CA3 1970); 2 C. Wright, Federal Practice and Procedure 515, n. 57 (1969).
[ Footnote 12 ] Although the States vary in their descriptions of the quantum of proof necessary to give rise to a right to a lesser included offense instruction, they agree that it must be given when supported by the evidence. See, e. g., Christie v. State, 580 P.2d 310 (Alaska 1978); State v. Valencia, 121 Ariz. 191, 589 P.2d 434 (1979); Westbrook v. State, 265 Ark. 736, 580 S. W. 2d 702 (1979); People v. Preston, 9 Cal. 3d 308, 508 P.2d 300 (1973); People v. White, 191 Colo. 353, 553 P.2d 68 (1976); State v. Brown, 173 Conn. 254, 377 A. 2d 268 (1977); Matthews v. State, 310 A. 2d 645 (Del. 1973); State v. Terry, 336 So.2d 65 (Fla. 1976); Loury v. State, 147 Ga. App. 152, 248 S. E. 2d 291 (1978); State v. Travis, 45 Haw. 435, 368 P.2d 883 (1962); State v. Beason, 95 Idaho 267, 506 P.2d 1340 (1973); People v. Simpson, 57 Ill. App. 3d 442, 373 N. E. 2d 809 (1978); Pruitt v. State, 269 Ind. 559, 382 N. E. 2d 150 (1978); State v. Millspaugh, 257 N. W. 2d 513 (Iowa 1977); State v. White, 225 Kan. 87, 587 P.2d 1259 (1978); Martin v. Commonwealth, 571 S. W. 2d 613 (Ky. 1978); State v. Carmichael, 405 A. 2d 732 (Me. 1979); Blackwell v. State, 278 Md. 466, 365 A. 2d 545 (1976), cert. denied, 431 U.S. 918 ; Commonwealth v. Santo, 375 Mass. 299, 376 N. E. 2d 866 (1978); People v. Jones, 395 Mich. 379, 236 N. W. 2d 461 (1975); State v. Merrill, 274 N. W. 2d 99 (Minn. 1978); Jackson v. State, 337 So.2d 1242 (Miss. 1976); State v. Stone, 571 S. W. 2d 486 (Mo. App. 1978); State v. Ostwald, 180 Mont. 530, 591 P.2d 646 (1979); State v. Hegwood, 202 Neb. 379, 275 N. W. 2d 605 (1979); Colle v. State, 85 Nev. 289, 454 P.2d 21 (1969); State v. Boone, 119 N. H. 594, 406 A. 2d 113 (1979); State v. Saulnier, 63 N. J. 199, 306 A. 2d 67 (1973); State v. Aubrey, 91 N. M. 1, 569 P.2d 411 (1977); People v. Henderson, 41 N. Y. 2d 233, 359 N. E. 2d 1357 (1976); State v. Drumgold, 297 N.C. 267, 254 S. E. 2d 531 (1979); State v. Piper, 261 N. W. 2d 650 (N. D. 1977); State v. Kilby, 50 Ohio St. 2d 21, 361 N. W. 2d 1336 (1977); Gilbreath v. State, 555 P.2d 69 (Okla. Crim. App. 1976); State v. Thayer, 32 Ore. App. 193, 573 P.2d 758 (1978); Commonwealth v. Terrell, 482 Pa. [447 U.S. 625, 637] 303, 393 A. 2d 1117 (1978); State v. Funchess, 267 S. C. 427, 229 S. E. 2d 331 (1976); State v. Grimes, 90 S. D. 43, 237 N. W. 2d 900 (1976); Howard v. State, 578 S. W. 2d 83 (Tenn. 1979); Day v. State, 532 S. W. 2d 302 (Tex. Crim. App. 1975); State v. Gillian, 23 Utah 2d 372, 463 P.2d 811 (1970); Painter v. Commonwealth, 210 Va. 360, 171 S. E. 2d 166 (1969); State v. Workman, 90 Wash. 2d 443, 584 P.2d 382 (1978); State v. Wayne, ___ W. Va. ___, 245 S. E. 2d 838 (1978); Leach v. State, 83 Wis. 2d 199, 265 N. W. 2d 495 (1978); Jones v. State, 580 P.2d 1150 (Wyo. 1978).
"There is no perfect procedure for deciding in which cases governmental authority should be used to impose death. But a statute that prevents the sentencer in all capital cases from giving independent mitigating weight to aspects of the defendant's character and record and to circumstances of the offense proffered in mitigation creates the risk that the death penalty will be imposed in spite of factors which may call for a less severe penalty. When the choice is between life and death, that risk is unacceptable and incompatible with the commands of the Eighth and Fourteenth Amendments." Id., at 605.
"Death, in its finality, differs more from life imprisonment than a 100-year prison term differs from one of only a year or two. Because of that qualitative difference, there is a corresponding difference in the need for reliability in the determination that death is the appropriate punishment in a specific case."
[ Footnote 14 ] We need not and do not decide whether the Due Process Clause would require the giving of such instructions in a noncapital case.
[ Footnote 15 ] The jury is not told that the judge is the final sentencing authority. Rather, the jury is instructed that it must impose the death sentence if it finds the defendant guilty and is led to believe, by implication, that its sentence will be final.
[ Footnote 16 ] The same analysis led to the conclusion that Louisiana's death penalty statute was unconstitutional. Roberts v. Louisiana, 428 U.S. 325 (opinion of STEWART, POWELL, and STEVENS, JJ.). That case involved a mandatory death penalty statute that required the judge to give a lesser included offense instruction whether or not it was justified by the evidence. Because such a procedure "invites the jurors to disregard their oaths and choose a verdict for a lesser offense whenever they feel the death penalty is inappropriate," it was the equivalent of a discretionary death statute in which the jury was given complete and unreviewable discretion, unguided by any standards as to when the death penalty was appropriate. Id., at 335.
[ Footnote 17 ] In Gregg v. Georgia, 428 U.S. 153, 199 (opinion of STEWART, POWELL, and STEVENS, JJ.), the prevailing opinion specifically rejected the argument that the new Georgia statute was unconstitutional because the availability of lesser included offense instructions made it possible that a jury might erroneously remove a defendant from consideration as a candidate for the death penalty. Under a statute like Georgia's, where guilt is determined separately from punishment, there is little risk that the jury will use its power to decide guilt to make a de facto punishment decision. Thus, eliminating lesser included offense instructions would not have the effect of reducing the risk of arbitrariness in the imposition of the death penalty. On the contrary, as was stated in a footnote in Gregg, eliminating this and other procedural safeguards that have long been accorded criminal defendants would raise serious constitutional questions. Id., at 199, n. 50.
Thus, it is only in cases like this in which the preclusion of lesser included offenses is linked to a mandatory death penalty that the State could even raise the possibility that the elimination of this procedural safeguard was a permissible way to reduce the arbitrary and capricious infliction of the death penalty.
[ Footnote 18 ] Forty-eight out of the first 50 defendants tried under the Alabama statute were convicted. See Brief in Opposition in Jacobs v. Alabama, O. T. 1978, No. 78-5696, pp. 10, 35. In this case the State has argued that the reason for the high conviction rate is that prosecutors rarely indict for capital offenses except in the clearest of cases because of the risk that a failure of proof on an essential element of the crime might lead to an acquittal. Assuming that this is the reason for the high conviction rate, the statistics still do not support the hypothesis that juries will be more likely to acquit than convict in a doubtful case.
[ Footnote 19 ] The closing arguments in this case indicate that under the Alabama statute the issue of whether or not the defendant deserves the death penalty will often seem more important than the issue of whether the State has proved each and every element of the capital crime beyond a reasonable doubt. Thus, in this case both the prosecutors and defense attorneys spent a great deal of argument time on the desirability of the death penalty in general and its application to the petitioner in particular, rather than focusing on the crucial issue of whether the evidence showed that petitioner had possessed the intent necessary to convict on the capital charge.
"[I]f the jury finds the defendant not guilty, the defendant must be discharged. The court may enter a judgment of mistrial upon failure of the jury to agree on a verdict of guilty or not guilty or on the fixing of the penalty of death. After entry of a judgment of mistrial, the defendant may be tried again for the aggravated offense, or he may be reindicted for an offense wherein the indictment does not allege an aggravated circumstance. If the defendant is reindicted for an offense wherein the indictment does not allege an aggravated circumstance, the punishment upon conviction shall be as heretofore or hereafter provided [447 U.S. 625, 644] by law; however, the punishment shall not be death or life imprisonment without parole."
[ Footnote 21 ] The jury in this case could hardly have been sure of the effect of a mistrial. In his closing argument one of petitioner's attorneys told the jury that "if I can have any opportunity under any reindictment or any other way to take him [petitioner] before this bar of justice and enter a plea of guilty of murder, robbery, either one, life in prison, I'll take him." Record 689. At another point, however, petitioner's other attorney indicated that petitioner could still be punished even if he were acquitted, stating: "I submit to you if you acquit him he's still in the Etowah County Jail. I submit to you if you acquit him that he can receive his due punishment, but I say to you his due punishment is not death." Id., at 709.
In his instructions to the jury the trial judge stated that, if acquitted, petitioner could not be tried "for anything he ever did to Roy Malone." And, although he explained that petitioner could be retried in the event of a mistrial, he did not elaborate on what that retrial would entail. Id., at 743.
Although I join the Court's opinion, I continue to believe that the death penalty is, in all circumstances, contrary to the Eighth Amendment's prohibition against imposition of cruel and unusual punishments. Gregg v. Georgia, 428 U.S. 153, 227 (1976) (BRENNAN, J., dissenting).
I continue to believe that the death penalty is, under all circumstances, cruel and unusual punishment prohibited by the Eighth and Fourteenth Amendments. Furman v. Georgia, 408 U.S. 238, 314 -374 (1972) (MARSHALL, J., concurring); Gregg v. Georgia, 428 U.S. 153, 231 -241 (1976) (MARSHALL, J., dissenting); Godfrey v. Georgia, 446 U.S. 420, 433 -442 (1980) (MARSHALL, J., concurring in judgment). In addition, I agree with the Court that Alabama's prohibition on giving lesser included offense instructions in capital cases is unconstitutional because it substantially increases the risk of error in the factfinding process. I do not, however, join in the Court's assumption that the death penalty may ever be imposed without violating the command of the Eighth Amendment that no "cruel and unusual punishments" be imposed. Lockett v. Ohio, 438 U.S. 586, 621 (1978) (MARSHALL, J., concurring in judgment); Bell v. Ohio, 438 U.S. 637, 643 -644 (1978) (MARSHALL, J., concurring in judgment). I join in the judgment of the Court.
"`Whether the Alabama Court of Criminal Appeals erred in its finding that the Alabama Death Penalty Statute is not in violation of Article III, Section 43, Article V, Section 124 and Amendment 38, of the 1901 Constitution of Alabama.'" 365 So.2d 1006, 1007.
Obviously, unless the Supreme Court of Alabama was wholly in error in deciding what issue petitioner had raised there, it was obviously not a question involving the United States Constitution.
I do not believe it suffices, under the jurisdiction granted to us by the Constitution and by Congress, to brush this matter off as the Court does in its footnote 6 on the grounds that petitioner presented his claim "in some fashion" to the Supreme Court of Alabama, and that "[t]he State has never argued that this presentation was insufficient, as a matter of state law, to preserve the issue."
This is not a matter that may be stipulated or waived by any of the parties to a case decided on its merits here. Title 28 U.S.C. 1257 provides that our certiorari jurisdiction extends only to "[f]inal judgments or decrees rendered by the highest court of a State in which a decision could be had. . . ."
"It is urged that in the writ of error and petition for citation it is stated that certain rights and privileges were [447 U.S. 625, 648] claimed under the Constitution of the United States, and that the Supreme Court of the State of Illinois decided against such rights and privileges, and, it is further urged, that the chief justice of the court allow the writ of error. This is not sufficient."
Thus it is insufficient that the State "has never argued" that a judgment under review is not that of the highest court of the State in which a judgment could be had; it will be assumed that the omission was due to want of proper presentation in the state courts, unless the aggrieved party in this Court can affirmatively show the contrary. Here I am not convinced that such a showing has been made.

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Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Seventh Circuit › 2016 › Hyson USA Inc. v. Hyson 2U, Ltd.
Hyson USA and Hyson 2U are food distributors. Hyson USA is wholly owned by its president, Tansky, and has operated since 2006. Kaminskas was one of its managers. In 2012, Hyson USA encountered serious financial difficulty, culminating in the loss of its liability insurance, forcing the company to suspend operations. Months later, Kaminskas established Hyson 2U. Hyson USA transferred its branded inventory and equipment to the new company. Hyson 2U leased the warehouse from which Hyson USA had operated. Tansky then switched roles with Kaminskas and went to work at the new company. Hyson 2U operated in the same manner and in the same markets as Hyson USA. In 2014, Tansky was fired. He and Hyson USA, again operational, sued Hyson 2U and Kaminskas alleging trademark infringement under the Lanham Act. The judge dismissed the trademark claims, citing acquiescence, and relinquished supplemental jurisdiction over the state-law claims. The Seventh Circuit reversed, stating that acquiescence is a fact-intensive equitable defense that is rarely capable of resolution on a motion to dismiss.
In the United States Court of Appeals For the Seventh Circuit ____________________ No. 14-3261 HYSON USA, INC., LEONID TANKSY, and ENNA GAZARYAN, Plaintiffs-Appellants, v. HYSON 2U, LTD., KAROLIS KAMINSKAS, INC., and KAROLIS KAMINSKAS, Defendants-Appellees. ____________________ Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 14 C 4320 — Milton I. Shadur, Judge. ____________________ ARGUED SEPTEMBER 10, 2015 — DECIDED MAY 16, 2016 ____________________ Before FLAUM, RIPPLE, and SYKES, Circuit Judges. SYKES, Circuit Judge. This is a trademark dispute between two food-distribution companies named Hyson. Hyson USA, Inc., is owned by Leonid Tansky and formerly em- 2 No. 14-3261 ployed Karolis Kaminskas as a manager. In early 2012 Hyson USA experienced a serious financial setback and suspended its operations. In a role reversal, Tansky then went to work for Kaminskas at his newly formed company Hyson 2U, Ltd. That company operated in much the same way as Hyson USA. About 17 months later, Tansky was fired. This suit is his response. Tansky and his company, Hyson USA, accuse Hyson 2U and Kaminskas of trademark infringement. See 15 U.S.C. §§ 1114 et seq. Hyson 2U moved to dismiss for failure to state a claim, see FED. R. CIV. P. 12(b)(6), arguing that the complaint affirmatively established the defense of acquiescence. That defense estops recovery if the trademark owner, by his words or conduct, manifested his consent to the defendant’s use of the mark. The district court granted the motion and dismissed the case. We reverse. The district judge jumped the gun in dismissing the case at the pleading stage. Acquiescence is a fact-intensive equitable defense that is rarely capable of resolution on a motion to dismiss under Rule 12(b)(6). I. Background Hyson USA and Hyson 2U are food distributors with a common history. Hyson USA is wholly owned by its president, Leonid Tansky, and has operated since 2006. Karolis Kaminskas was one of its managers. In the spring of 2012, Hyson USA encountered serious financial difficulty, culminating in the loss of its liability insurance. That move forced the company to suspend its operations. In September 2012 Kaminskas established Hyson 2U, and Hyson USA then transferred its branded inventory and No. 14-3261 3 equipment to the new company. Hyson 2U also leased the warehouse from which Hyson USA had operated. Tansky then switched roles with Kaminskas and went to work for him at his new company. After the changeup Hyson 2U operated in the same manner and in the same markets as Hyson USA. For reasons not disclosed, in February 2014 Tansky was fired. About five months later, he and Hyson USA—now up and running again—sued Hyson 2U and Kaminskas alleging claims for trademark infringement under the Lanham Act; 1 the suit also included several state-law claims. 2 The defendants (we’ll refer to them collectively as “Hyson 2U”) moved to dismiss the federal claims under Rule 12(b)(6), arguing that the allegations in the complaint established the affirmative defense of acquiescence. The judge agreed, dismissed the trademark claims, and relinquished supplemental jurisdiction over the state-law claims. This appeal followed. II. Discussion We review de novo the district court’s order dismissing the complaint under Rule 12(b)(6) for failure to state a claim. Citadel Grp. Ltd. v. Wash. Reg’l Med. Ctr., 692 F.3d 580, 591 (7th Cir. 2012). Dismissal is appropriate under that rule when the factual allegations in the complaint, accepted as 1 The Lanham Act claims are for trademark infringement, false designation of origin, trademark dilution, and cybersquatting. See 15 U.S.C. § 1114(1); id. § 1125(a), (c), (d). 2 Tansky’s wife, Enna Gazaryan, is also a plaintiff, but her presence in the suit is not important here. We’ll refer to the plaintiffs collectively as “Hyson USA.” 4 No. 14-3261 true, do not state a facially plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007); Silha v. ACT, Inc., 807 F.3d 169, 173– 74 (7th Cir. 2015). This case implicates the pleading principle that “[t]he mere presence of a potential affirmative defense does not render the claim for relief invalid.” Brownmark Films, LLC v. Comedy Partners, 682 F.3d 687, 690 (7th Cir. 2012). That is, a plaintiff ordinarily need not anticipate and attempt to plead around affirmative defenses. Chi. Bldg. Design v. Mongolian House, Inc., 770 F.3d 610, 613 (7th Cir. 2014). An exception applies when “the allegations of the complaint … set forth everything necessary to satisfy the affirmative defense.” United States v. Lewis, 411 F.3d 838, 842 (7th Cir. 2005). However, because affirmative defenses frequently “turn on facts not before the court at [the pleading] stage,” Brownmark Films, 682 F.3d at 690, dismissal is appropriate only when the factual allegations in the complaint unambiguously establish all the elements of the defense, Brooks v. Ross, 578 F.3d 574, 579 (7th Cir. 2009). In other words, the plaintiff “must affirmatively plead himself out of court.” Chi. Bldg. Design, 770 F.3d at 614. At issue here is the doctrine of acquiescence, a factsensitive equitable defense that may estop a trademark owner from obtaining injunctive and monetary remedies for trademark infringement. Before turning to the specifics of the defense, it’s helpful to step back and recall some basics of trademark law. The purpose of trademark protection is to identify the source of a good or service to consumers. See RESTATEMENT (THIRD) OF UNFAIR COMPETITION § 9 (AM. LAW INST. 1995). No. 14-3261 5 Trademark law does this by granting the owner of a mark the right to prevent others from using the mark in a way that is likely to cause confusion. See Sorensen v. WD-40 Co., 792 F.3d 712, 726 (7th Cir. 2015) (“The keystone of trademark infringement is likelihood of confusion as to source, affiliation, connection, or sponsorship of goods or services among the relevant class of customers and potential customers.”) (internal quotation marks and citation omitted). Trademark protection is granted only for so long as the mark reliably identifies the source of a good or service. Accord Eva’s Bridal Ltd. v. Halanick Enters., 639 F.3d 788, 790 (7th Cir. 2011) (“A person who visits one Kentucky Fried Chicken outlet finds that it has much the same ambiance and menu as any other. … The trademark's function is to tell shoppers what to expect—and whom to blame if a given outlet falls short.”). If a trademark owner acquiesces to another’s use of his mark, however, then the mark’s original source-identifying power is weakened and the owner may be estopped from obtaining relief in an infringement action against the junior user. See TMT N. Am., Inc. v. Magic Touch GmbH, 124 F.3d 876, 885 (7th Cir. 1997); accord Eva’s Bridal, 639 F.3d at 790. Thus, acquiescence is an affirmative defense in an action for trademark infringement under the Lanham Act. See 15 U.S.C. § 1115(b)(9). Generally speaking, acquiescence is an equitable doctrine that permits the court to deny relief in an action for trademark infringement if the evidence shows that the owner of the mark has, through his words or conduct, conveyed his consent to the defendant’s use of the mark. See Magic Touch, 124 F.3d at 885; Piper Aircraft Corp. v. Wag-Aero, Inc., 741 F.2d 925, 932–33 (7th Cir. 1984); see also SunAmerica Corp. v. Sun 6 No. 14-3261 Life Assurance Co., 77 F.3d 1325, 1334 (11th Cir. 1996); see generally RESTATEMENT (THIRD) OF UNFAIR COMPETITION § 29. The defense prevents the trademark owner from impliedly permitting another’s use of his mark and then attempting to enjoin that use after the junior user has invested substantial resources to develop the mark’s goodwill. See Magic Touch, 124 F.3d at 885. We’ve noted (as have other courts) that “acquiescence is related to the doctrine of laches, by which equity comes to the aid of an innocent user and grants him refuge from a claimant who has calmly folded his hands and remained silent while the innocent user has exploited and strengthened the mark.” Id. (internal quotation marks omitted). Indeed, our acquiescence cases import aspects of laches analysis, looking to the reliance interests of the junior user, the senior user’s delay in enforcing his rights, and the prejudice to the junior user if the senior user’s rights are enforced. See, e.g., Piper Aircraft, 741 F.3d at 932–33; Magic Touch, 124 F.3d at 885–86; Seven-Up Co. v. O-So-Grape Co., 283 F.2d 103, 106 (7th Cir. 1960) (formally decided under the doctrine of laches but also discussing acquiescence). Importantly, however, “[w]hereas laches is a negligent, unintentional failure to protect trademark rights, [a]cquiescence is associated with intentional abandonment.” Piper Aircraft, 741 F.2d at 933 (emphasis added and quotation marks omitted). It requires an “affirmative word or deed” that conveys the trademark owner’s implied consent to the junior user’s use of his marks. Magic Touch, 124 F.3d at 885 (emphasis added and quotation marks omitted). Or, as the Fourth Circuit has aptly put it, “[a]cquiescence is the active counterpart to laches, a doctrine based on passive consent. Both doctrines connote consent by the No. 14-3261 7 owner to an infringing use of his mark, but acquiescence implies active consent.” What-A-Burger of Va., Inc. v. Whataburger of Corpus Christi, Tex., 357 F.3d 441, 452 (4th Cir. 2004) (internal quotation marks omitted); accord Creative Gifts, Inc. v. UFO, 235 F.3d 540, 548 (10th Cir. 2000) (“Acquiescence requires proof even more demanding than a showing[,] which would suffice for a laches defense[,] that the party seeking to enforce its trademark rights has unreasonably delayed pursuing litigation and, as a result, has materially prejudiced the alleged infringer.”). In short, although our cases sometimes blend the doctrines of acquiescence and laches, they are formally distinct and should be analyzed separately. See 6 J. THOMAS MCCARTHY, MCCARTHY ON TRADEMARKS AND UNFAIR COMPETITION § 31:41 (4th ed. 2014) (“To preserve some semantic sanity in the law, it is appropriate to reserve the word ‘acquiescence’ for use only in those cases where the trademark owner, by affirmative word or deed, conveys its implied consent to another. That is, laches denotes a merely passive consent, while acquiescence implies active consent. This results in two separate legal categories: ‘estoppel by laches’ as distinct from ‘estoppel by acquiescence.’”). The Eleventh Circuit has distilled acquiescence doctrine into three elements: “(1) the senior user actively represented that it would not assert a right or a claim; (2) the [senior user’s] delay between the active representation and assertion of the right or claim was not excusable; and (3) the delay caused the defendant undue prejudice.” SunAmerica, 77 F.3d at 1334; see also Coach House Rest., Inc. v. Coach & Six Rests., Inc., 934 F.2d 1551, 1558 (11th Cir. 1991). The Second and Ninth Circuits agree and have adopted this test for the 8 No. 14-3261 defense. See Seller Agency Council, Inc. v. Kennedy Ctr. for Real Estate Educ., Inc., 621 F.3d 981, 989 (9th Cir. 2010) (listing the same elements); Pro Fitness Physical Therapy Ctr. v. Pro-Fit Orthopedic & Sports Physical Therapy P.C., 314 F.3d 62, 67 (2d Cir. 2002) (same). Our acquiescence cases engage in essentially the same analysis (though without listing elements), so we’ll use this formulation too. Applying this understanding of the doctrine here, Hyson USA’s complaint does not unambiguously establish the affirmative defense of acquiescence. The complaint alleges that Hyson USA transferred its branded inventory and equipment to Hyson 2U, that Hyson USA knew Hyson 2U was using its marks, and that Tansky worked for Hyson 2U for about 17 months before he was fired. There are no allegations that Hyson USA or Tansky made any active representations—by word or deed—that they would not assert a right or claim regarding the Hyson trademark. The other two elements of the defense—delay and undue prejudice— cannot alone support a finding of acquiescence, so we need say no more about them here. We note in closing that an equitable defense like acquiescence is not ordinarily susceptible to resolution at the pleading stage. The defense requires a qualitative examination of the parties’ words and conduct and an equitable evaluation of the length of the delay and the degree of prejudice to the defendant if the trademark owner’s rights are enforced. That kind of analysis generally requires a factual record. We note as well that even when an acquiescence defense can be proven, “[t]he law … allows the senior user’s claim to be revived from estoppel if the senior user can show that ‘inevitable confusion’ would result from dual use of the No. 14-3261 9 marks.” Magic Touch, 124 F.3d at 886 (quoting SunAmerica, 77 F.3d at 1334). That question, too, is generally inappropriate for resolution on the pleadings. Because the allegations in the complaint do not unambiguously establish everything necessary for the affirmative defense of acquiescence, it was error to dismiss the case under Rule 12(b)(6). Accordingly, we reverse the judgment and remand for further proceedings consistent with this opinion. REVERSED.


The Internet has allowed new assets to spring into existence for consideration by competent tax and estate planners. For tax and estate planning purposes, each Internet asset is subject to one of three different legal classes.
The Internet has allowed new assets to spring into existence for consideration by competent tax and estate planners. All Internet assets are intangible personal property -- they cannot be seen felt or perceived by the ordinary senses. For tax and estate planning purposes, each Internet asset is subject to one of three different legal classes.
The first class is Internet assets contained in a decedent’s computer or storage device. Class one Internet assets include e-mails, software, content and data stored in tangible property, typically a decedent’s home computer.
A second class of Internet assets are access rights and use rights to Internet assets located in a computer or other storage device owned by a person other than the decedent. Class two Internet assets are e-mails, software, content and data stored in tangible property on a third party’s computer or other tangible property.
Class three Internet assets are access and use rights related to Internet assets, but unlike class two assets, class three Internet assets do not have any physical point of presences (i.e. their existence is not dependant upon storage), hence they need not stored anywhere. A domain name is an example of a class three Internet asset.
All three types of decedent's Internet assets are susceptible to traditional estate and tax planning. The treatment of each of the three types of Internet assets is generally analogous to the treatment of certain tradition assets for the purposes of distribution and taxation.
The treatment of class one Internet assets may be analogized to the treatment of traditional assets which are intangible tangible in nature, and stored in a tangible asset which are in the possession the decedent at the time of his or her death. Thus, with respect to class one Internet assets, a party with the lawful right to the tangible property within which the Internet assets are contained is normally granted the rights to them. For example, e-mails are typically distributed with the home computer which holds them.
For tax purposes, the gross estate includes value of all property in which decedent had interest, including intangible and tangible personal property, wherever located. In accord with I.R.C. § 2033 and Treas. Reg. § 20.2033-1(a), all personal property both tangible or intangible is included in the gross estate as long as the decedent has a beneficial ownership interest in it at the time of his death.
As indicated by Stewart v. Commissioner, 49 F.2d 987 (10th Cir. 1931), regardless of who holds title to a decedent's property, it is the beneficial ownership interest in property that determines whether it is included in the gross estate, which has tax ramifications. Thus, even if the class one Internet property is contained in a computer owned by a party other than the decedent's beneficiary, the beneficiary is the owner of the class one Internet property.
It should be noted that even trustees are not the owner of class one Internet assets because of the principle that legal title does not control estate inclusion is the case of the decedent acting as trustee. Whether a trustee under a valid trust instrument or under a resulting trust due to state law, a trustee is not the owner of class one Internet assets and said assets should be includable in the decedent's gross estate.
A legal difficulty may arise with respect to the disposition of class one Internet assets if a number of members of a family pooled their income and the deceased purchased a computer on which the class one Internet some real property in his name and there are no records of how much each family member contributed. In this case, the class one Internet assets must be included in the deceased's estate, according to Estate of Brickert v. Commissioner , 37 T.C. 57 (1961).
If each member of the family documents the amount contributed towards the purchase of the computer, the result may be different. Additionally, if state law allows, a resulting trust can be established for each of the contributors. In that case, only the portion of the property attributable to the decedent-titleholder's contribution is included in his gross estate according to Rev. Rul. 78-214.
Class one Internet assets are valued as traditional intangible assets. According to Guaranty Trust Co. v. Commissioner, 79 F.2d 245 (2d Cir. 1935), the gross estate includes the full value of all tangible personal property, wherever located, beneficially owned at the time of death.
Clearly, if a beneficiary is in possession of the desired e-mails -- because said beneficiary saved a copy of each e-mail received or because he owned or inherited the decedent’s computer within which the desired e-mails still reside – the beneficiary would own the e-mail. However, alternate facts are possible and the desired e-mails are not in the possession of the beneficiaries.
With class two assets, the decedent merely had access, not possession. Contracts normally govern access to class two Internet assets. Consequently, the rights to class two Internet assets are determined based on the assignment or non-assign clause associated with the class two Internet assets.
In the event that class two Internet assets are in fact assignable, such assets are treated like other intangibles owned by decedent and are included in gross estate. Thus, typically all assignable class two Internet assets belonging to the decedent at the date of his death are included in his gross estate. Assignable class two Internet assets are included at face value unless the asset has some intrinsic value greater than its face value.
For example, the decedent could posses an assignable electronic contract stored in a third party computer for 100 one dollar noncirculating coins that are no longer minted. This electronic agreement, which is a form of class two Internet assets, must be included in the gross estate at the fair market value rather than face value of $100, in accord with Rev. Rul. 78-360.
Class two Internet assets also include all money held in Internet bank accounts and PayPal accounts owned by the decedent. These class two Internet assets are also included in the decedent's gross estate. Internet bank accounts are generally owned by the person whose name is on them; however, legal title does not always control. For example, when a portion of the decedent's Internet bank account is determined to be the property of a third party (such as when an amount authorized by the decedent to pay for an e-Bay purchase pending receipt of goods).
The legal difficulties associated with Internet bank accounts and other Internet fund storage program is similar to the difficulties associated with checking accounts. In both instances, payments are authorized and delivered prior to a decedent's death but are not actually paid (i.e., they do not actually clear the decedent's fund storage area) until after his death. These payments are excluded from the gross estate if three conditions are met: (1) the payments are given to discharge a lawful obligation of the decedent; (2) the payments are subsequently honored by the Internet fund holder and charged to the decedent's account; and (3) the obligations are not claimed as deductions from the gross estate.
As in the case of traditional checks, a decedent making gifts, charitable or otherwise, delivered via the Internet before the decedent's death, but clearing the decedent's Internet fund storage area after his death, may result in a legal difficulty. The Internal Revenue and the Tax Court are still attempting to resolve such matters. It is presumed such funds would be included in decedent’s gross estate if the courts rely on McCarthy v. United States, 806 F.2d 129 (7th Cir. 1986), rev'g 624 F. Supp. 763 (N.D. Ill. 1985).
Not all class two Internet assets are assignable. For example, a descent's e-mail held by an Internet Service Provider (ISP) is only assignable if so stated in the agreement between the ISP and the deceased.
Like class two Internet assets, contracts normally govern access to class three Internet assets. Under the common law's expansive "bundle of rights" conceptualization of property, a domain name (or, at least, the right to use the domain name) would be property because a holder has the right to use it, exclude others from using it, and transfer it to another entity. As such, the holder's rights in the domain name and/ or in an Internet site access are substantially similar to the rights of a tenant or licensee. However, the holder of such Internet rights also has some of the same rights as the real estate owner and/or the inventor, such as the rights associated with a creator or inventor.
This tax treatment, consistent with the Tax Code, includes generally nontransferable property in the estate and permits the trustee to sell the property. The trustee nonetheless must comply with any contractual provisions that place restrictions on the manner in which the original party can transfer the property, or conditions that must be satisfied before the property can be transferred. Thus an executor who seeks to transfer a decedent’s Internet rights in the domain name or Internet site access rights must comply with appropriate contract transfer procedures.


Alongside the Health Care Act decision, Kiobel is an example of the professoriate failing to predict the issues that would be taken seriously by the Court both on substance and style. When the Second and Ninth Circuit began questioning “foreign cubed” suits a few years ago, the great majority of scholars dismissed such claims as entirely spurious. The conventional wisdom was very much on the side of universal jurisdiction over corporate human rights abuses. Indeed, such cases had been around for a few decades without much controversy over the universal jurisdiction aspect per se.
Judge Kozinski has gotten considerable criticism from liberals for ruling that Sea Shepherd is involved in piracy under international law. A subsequent post will provide additional support for the decision on the merits. Here, I’d like to look at the big picture and suggest that liberals should be thanking Kozinski: a contrary ruling would have torpedoed two liberal causes – the U.S. ratification of the Law of the Sea treaty, and a broad construction of the Alien Tort Statute.
A ruling that politically motivated attacks are exempt from piracy would certainly add weight to conservative skepticism of the Law of the Sea Treaty. The root of this skepticism is a concern that the meaning of international legal instruments is actually quite uncertain, and unforeseen vagaries will later be used against the U.S., which will have no monopoly on interpreting the law that applies to it. The retort is that such fears are paranoid; the treaty is clear, by now well-worn, and pretty harmless.
Well if the piracy provisions – which have not been the ones causing conservative anxiety – are actually highly disputed in their meaning on basic definitional points, there may be more to worry about than previously thought. Lets say the meaning of “private ends” is in fact undefined, with both interpretations open. The U.S.’s ability to treat maritime terrorists as international pirates will thus probably depend on what a bunch of professors and European foreign ministry lawyers say “private ends” means.
The Ninth Circuit was right to reverse the district court in the Sea Shepherd Case. The district court erroneously read “private ends” as excluding political ends like saving the whales. But the “private ends” requirement has never been understood to inject a subjective element to the piracy inquiry. It does not turn on whether the actor’s motives are pecuniary, political, operating under mistake of fact, or simply insane. Private ends are those ends held by private parties. The converse is also true: a government-owned ship in government service cannot commit piracy even if it attacks another vessel solely to enrich itself.
The rule is clear as both a matter of customary international law and the Law of the Sea Convention. On the latter score, the “private” ends requirement of the UNCLOS Art. 101 (which defines piracy) has to be read in conjunction with Art. 102, which distinguishes between “warship” or “government ship” – which cannot commit piracy while under governmental control and “private” ships, which are the kind that can be pirates. Thus “private” clearly means “non-governmental,” rather than selfish or not selfish.
The Ninth Circuit’s reversal of a district court decision ruling that actions by Sea Shepherd against Japanese whaling vessels could not constitute piracy because they did not satisfy the “private ends” requirement is obviously correct. (Institute of Cetacean Research v. Sea Shepard Conservation Society.) The district court’s analysis always struck me as strange and disconnected with piracy practice and caselaw. In this post, I’ll discuss the relevance of the decision to Alien Tort Statute issues, and in a subsequent one, I’ll examine the merits.
The Japanese whalers brought suit under the ATS, and the case is notable in two other ways relevant to the Supreme Court’s upcoming decision in Kiobel. First, it shows that the ATS can have both liberal and conservative uses, as I’ve noted before. It is true that there have been few conservative uses, but there weren’t any uses of any kind for 200 years, until Filartiga inspired a wave of human rights litigation. Thus a ruling narrowing the ATS in Kiobel cannot be simply interpreted as “conservative” decision.
Second, it shows that even the narrowest possible ruling in Kiobel – finding the statute to not apply on foreign territory or create corporate liability – cannot be said to close the door to all ATS litigation, or read the statute so narrowly as to make it a dead letter. This case, for example, would clearly survive the narrowest possible post-Sosa view of the ATS.
The government is prosecuting three foreigners for the participating in “combat operations” in a foreign civil war.
The indictment apparently alleges no connection to America, or even foreign commerce (unlike a similar 2011 case that lacked an apparent connection to the U.S.) The defendants are Somalis who fought in Somalia. In a previous post, I discussed why the prosecution exceeds’s Congress’s Define & Punish powers; here we’ll consider other possible Art. I grounds. Today – the Foreign Commerce Clause; later today, War and Treaties. Tomorrow: additional thoughts about American exceptionalism in universal jurisdiction.
My previous post focussed on the Define & Punish Clause as the basis for the MST law; today, we will examine some other suggestions. I addressed the Define & Punish clause first because it is the first Art. I power Congress cited in its “findings” in support of the section. (sec. 301(a)(2) of the public law). Later, the findings do suggest the Commerce powers as a tertiary rationale: terrorism discourages travel from the U.S. to affected country, and vice versa. It also mentions general harm to “market stability.” This sounds a lot like the arguments rejected by the Supreme Court in U.S. v Morrison . Surely Congress’s can’t regulate any crime anywhere in the world just because it upsets things. The commerce argument is even weaker here: if someone moves out of their state because of violence against women, they presumably move to another U.S. state. But if they move from Somalia, they do not presumably move to the U.S.
The Fourth Circuit’s noteworthy decision in U.S. v. Dire is probably the first court of appeals decision in a piracy prosecution in nearly 200 years. The Fourth Circuit decision is important not only for some novel pending piracy cases, but for the Alien Tort Statute and broader questions about the interplay of U.S. and international law.
Two groups of defendants were tried by different federal district judges for attempted piracy – they had been caught before boarding the targeted vessel (which was unfortunately for the defendants, a U.S. warship). They were charged under 18 U.S.C § 1651 with “piracy as defined by the law of nations.” Both cases turned on whether that “definition” extends to attempts. One district court said yes, in the Dire case. Another district judge, in Said, said no. He looked the important 1820 piracy case of U.S. v. Smith, where the Supreme Court discussed the definition of piracy, and said everyone agreed it was “robbery on the high seas.” Since there was no robbery here – no piracy.
In discussions of Kiobel v. Royal Dutch Shell and the Alien Tort Statute, many commentators suggested if the Supreme Court limits corporate liability or extraterritoriality under the ATS, it would eviscerate the statute, and be bad for human rights. More generally, limiting the ATS is thought to serve broadly conservative interests.
These points are only weakly true for the ATS, as I’ll explain below. But more broadly, a limited understanding of the role of universal jurisdiction (UJ) and the Constitution’s Offenses power would have a variety of cross-cutting political valences when applied to other statutes. I have been describing the sources and scope of the constitutional limits on UJ in prior posts. So if reigning in foreign-cubed suits under the ATS can be “scored” as a liberal loss, the logic for doing so would give conservatives a loss under the material support for terrorism law, and both a conservative and liberals loss under the Maritime Drug Law Enforcement Act (but a libertarian win!).
To put it differently, UJ – the exercise of judicial power in foreign-cubed suits – has no inherent political valence; this depends on the norms being universalized. The ATS is one of a few instances of such jurisdiction, and a restriction on it could have several ripples and ramifications in other important contexts.
One aspect of the ACA litigation that has not received due attention is the effect of the Court’s ruling on the scope Foreign Commerce Clause. An expansive, limitless definition of the scope of “Commerce” would presumably apply to Foreign Commerce as well. If there is no limiting principle for the former, it would be hard to have a limiting principle for the latter.
Lets take a break from the ACA to think about the federal government’s power to to deal with matters that have no connection to the U.S., an issue the Court will take up when it hears the expanded arguments in Kiobel, the ATS case.
Yesterday I talked about how the ATS extraterritoriality at issue in Kiobel is really something rarer and more extreme: universality. Thus the analysis starts with the classic universal crime and obscure constitutional provision – Piracy, which has gotten significant play in the courts of appeals’ extraterritoriality cases like Doe v. Exxon and Rio Tinto (as well as in the Kiobel oral arguments on corporate liability). Because Sosa held that piracy would be actionable under the ATS, it is clear that the battle over extraterritoriality in Kiobel will be a naval engagement. It is true that piracy occurs extraterritorially, and under the current piracy statute, can be prosecuted even with no connection to the U.S. But proponents of foreign-cubed draw precisely the wrong inferences from piracy’s exceptional status.
Piracy is not just any international crime: it has its own separate constitutional provision: Congress can punish “piracies and felonies on the high seas, and Offenses against the law of nations.” Thus whatever is true of “piracy” is not necessarily true of other “Offenses” that can be reached under the ATS: these are separate, though related, Art. I powers. The Constitution’s singling out of piracy is striking and demands explanation, because it creates a double-redundancy. Does anything make piracy different from other high seas felonies and international law offenses? Yes: it was the only universally cognizable offense at the time.