As litigators we pride ourselves on our ability to take the “sand and clay” we are initially given and develop it to persuade others that our client’s position is correct. We view it as our professional duty to use our skill and credibility on another person’s behalf. Ultimately, through passion and dedication we end up believing in our client’s case, even when our friends and colleagues express skepticism.
These sentiments are understandable. But, without such investigation, we risk that the opinion letter we draft, the affidavit we provide, the demand letter we send, or the recommendation we give to withhold from production privileged documents, will be viewed in a different—even criminal—light. When facts that we represented as true turn out to be false, these routine acts of representation could become the grounds for a criminal indictment (against the lawyer and/or the client) or the basis for a disciplinary action by the Bar.
Generally, under Bar disciplinary rules, attorneys are not sanctioned for statements made in reliance on a client’s misrepresentation. However, an attorney may face criminal liability for such statements even when the attorney had no knowledge of the client’s deception.
Below is a brief survey of the regulations and criminal doctrines that counsel should be aware of when deciding whether it is necessary to obtain more facts before advocating on a client’s behalf.
Even if you have no knowledge that your client has given you false information, you are still at risk of criminal prosecution if you make misrepresentations to the court, opposing counsel or third parties in reliance on false information from your client. Prosecutions of lawyers have been brought absent evidence of deliberate misrepresentations, including prosecutions for mail and wire fraud, money laundering, racketeering, obstruction of justice, and perjury, among others.
Joseph Collins, an established transactional lawyer at Mayer Brown, is currently facing similar charges for actions he took during his representation of the now-bankrupt commodities broker Refco. The indictment accuses him of preparing misleading documents sent to investors, filing materially false statements with the SEC, and structuring transactions designed to improperly shuffle debt between Refco and third parties for accounting purposes. Mr. Collins faces charges of securities fraud, wire fraud, and filing false statements with federal regulators.
As Beckner illustrates, investigations and prosecutions of lawyers based on their representation of clients are not limited to far-fetched or extreme circumstances. To avoid misuse of such actions, the Justice Department instituted internal procedures that govern the investigation and prosecution of attorneys based on their representation of clients. Worrisome to counsel, these procedures contemplate nonprosecution agreements with clients under investigation in exchange for testimony against their attorneys.
Although mail and wire fraud are probably the last thing on your mind when you are preparing a letter, e-mail or filing for a client, these federal crimes carry hefty maximum prison sentences and fines, and, as interpreted, do not require an actual intent to defraud or actual knowledge of the misrepresentation. Under Ninth Circuit precedent, both the intent and knowledge elements of these crimes can be shown by recklessness. Nor is it necessary to show that the perpetrator of the fraud expected to profit or benefit personally from the fraud. As a result, mail and wire fraud present surprisingly low hurdles for prosecution and should concern attorneys who communicate with third parties on behalf of their clients.
A lawyer helps a long-time client prepare a letter to one of the client’s lenders. The lawyer knows the letter will be e-mailed to the lender who will rely on information in the letter to decide whether to call certain loans to the client. The lawyer does not fact-check the letter, relying instead on the client and its accountant for the facts.
A lawyer drafts an opinion letter knowing it will be mailed to investors in his client’s business. The letter is designed to calm investor’s fears. The lawyer relies on facts about the client’s business supplied by the client who the lawyer knows is desperate and under extreme stress at the time. The lawyer knows the client will likely go under if the investors balk.
What is the likelihood that the attorney will be held liable for mail or wire fraud when the facts in these scenarios ultimately turn out to be false or misleading? The issue turns on what is reckless and what can be inferred from the lawyer’s relationship with the client.
Courts define reckless as a conscious disregard of a substantial and unjustifiable known risk. The question then is what quantum of information tips a lawyer off that the situation is not what is being represented by the client. In other words, is the lawyer disregarding information that should lead him to doubt the truthfulness and accuracy of the client’s statement? Cases in non-attorney contexts suggest that, such things as relying on a client’s memory of a key date or other detail without checking to see if the client verified the accuracy of her memory could constitute disregarding a known risk that the client’s recollection is inaccurate. Relying on a client’s extravagant claims without any further investigation may also constitute a reckless disregard for the truth. In such circumstances, if the lawyer proceeds without investigation and it turns out the client’s representation is inaccurate, both the client’s and the lawyer’s credibility are damaged and both may be subject to fraud charges.
In holding that specific intent to defraud may be proved by a showing of recklessness, the Ninth Circuit has also effectively modified the good faith defense generally available to require some level of investigation or diligence (i.e., no recklessness). Other circuits continue to recognize the traditional good faith defense—i.e., an honest belief in the truth or a showing of honest mistake excuses otherwise fraudulent conduct. Courts in the Ninth Circuit, however, have held that a defendant is not entitled to a good faith instruction because it would be duplicative of a proper instruction on specific intent—in other words, if specific intent is proven, good faith is necessarily disproven. Thus, because specific intent can be proven by recklessness alone, good faith is disproven by recklessness.
Of course, the government can prove actual knowledge of the misrepresentation by circumstantial evidence. Reviewing courts have held that evidence that a lawyer had a particularly close relationship with the client was sufficient to prove knowledge of the client’s fraud, despite no direct evidence of the lawyer’s knowledge. In one wire fraud case, the court suggested that knowledge of a client’s misrepresentation may be inferred by the jury from “an intimate association with the client’s activities,” such as that of an in-house lawyer. But, in that case, where the lawyer was outside trial counsel, the court concluded that the evidence was not sufficient to support an inference that the lawyer knew about the client’s fraud. There, the court observed that the lawyer was not a confidant or everyday advisor to the client, that he specifically disclaimed sophistication in the matters later called into question (SEC matters), and that he sought assistance from other lawyers with expertise in those matters. Similarly, another reviewing court held that a lawyer’s act of simply “papering a deal” or acting as a mere “scrivener” was insufficient to infer knowledge of a client’s misrepresentation. In contrast, a lawyer’s acts of vouching for and promoting his client have been sufficient to support a jury’s inference of knowledge.
The risk a lawyer will be held to have knowledge of a client misrepresentation increases the more the lawyer is personally involved in the deal. In Bonavire, the court noted that the lawyer not only vouched for the client but also acted as the escrow agent for the parties. When a lawyer is also a friend of, investor in, or partner with the client, or receives fees in the form of shares in the client company the likelihood of inferred knowledge increases even more. It is no surprise that multiple cases have successfully been brought under those circumstances.
In summary, because the mens rea elements of mail and wire fraud may be satisfied by a showing of recklessness or inferences drawn from the lawyer’s relationship with the client or the lawyer’s acts of promoting or vouching for the client, a lawyer should conduct sufficient independent investigation and analysis of the client’s facts to feel confident in them before presenting them to third parties. The greater the lawyer’s connection to the client, the higher the risk to the lawyer if the representations turn out to be inaccurate. Lawyers who have a pecuniary interest in the client’s venture, a long-term relationship, a friendship or other particularly close relationship with the client are particularly at risk of being deemed to have acted recklessly or to have knowledge of or motive to participate in the fraud.
As is the case under the federal mail and wire fraud statutes, a lawyer can face liability under the state and federal securities laws without actual knowledge of the fraud or misrepresentation. Under federal securities law, the accused must have the intent to defraud buyers or sellers of securities and knowledge of the misrepresentation. However, as in the mail and wire fraud context, the Ninth Circuit has held that reckless disregard for the truth satisfies these elements.
Oregon law is more expansive than federal securities law in its scope. In Oregon, the attorney who drafts fraudulent securities offering material can be criminally liable under the Oregon Securities Fraud statute, ORS § 59.115(3). Although the statute does not specify the culpable mental state required for a criminal conviction, the Oregon Court of Appeals has affirmed a criminal conviction where the prosecution plead and proved knowing misrepresentation. However, the far lesser mens rea of negligence may also be sufficient. Arguably, because the securities statute is outside the criminal code and contains no mental state, ORS 161.605(3) applies, which allows criminal liability based on criminal negligence only. Each criminal violation of the Oregon Security Fraud statute constitutes a Class B felony punishable by up to 10 years in prison and a $250,000 fine.
Is the lawyer guilty of obstruction of justice? If so, the lawyer could face up to 20 years in prison.
Traditionally, obstruction of justice required a corrupt intent to obstruct a pending official proceeding. Clearly, the lawyer in the above scenario would not be guilty of traditional obstruction. But, as modified by Sarbanes-Oxley, obstruction in many contexts no longer requires a pending proceeding and, where the obstruction is of a federal agency investigation, it no longer requires a corrupt intent. Under the obstruction actions created by Sarbanes-Oxley, it is sufficient that the defendant contemplated the possibility of a proceeding at the time the obstruction occurred. And, in the context of non-pending federal agency proceedings (e.g., SEC investigations), the defendant need not have acted with corrupt intent. Under this laxer standard, the lawyer in the scenario above could face liability because the lawyer knew a proceeding was theoretically possible (in light of the disgruntled employee’s complaint on the weblog) and nevertheless recommended deleting the e-mails. Although the lawyer did not intend to destroy relevant evidence, the lawyer intended to delete prejudicial e-mails, thus possibly satisfying the lesser mens rea (i.e., by intentionally impeding fact finding, albeit of irrelevant facts).
A corrupt intent is still required to prove obstruction in other contexts (e.g., judicial investigations and proceedings and pending agency proceedings). The Supreme Court has defined “knowingly corruptly,” the mens reain Section 1512(b)’s witness and jury tampering prohibition, as consciousness of wrongdoing, where wrongdoing is wrongful, immoral, depraved, and evil acts. Despite this, an Oregon attorney was convicted of obstruction (but granted a new trial) based only on circumstantial evidence of knowledge. There, the attorney received a call from a client who was in jail pending a criminal trial. The client asked the attorney to wind up the affairs of a small business unrelated to his crime. The client provided a list of instructions to relay to one of his employees, which included the location of a hidden envelope that he wanted destroyed. The attorney passed on the information and was subsequently arrested and prosecuted for obstruction of justice. The attorney argued that he thought he was legitimately helping his client secure his property and business assets in anticipation of a lengthy sentence; he testified that “none of the flags were up,” that he thought the letter was a love letter. The government’s theory of criminal intent was that any reasonable person, especially an attorney, would have known he was being asked to impair or destroy evidence when someone in jail calls him and requests that something be destroyed. The government did not argue that the attorney assisted in the destruction of the envelope to advance any personal interest of the attorney.
A financial stake in the client’s business can be particularly problematic if the attorney is later accused of obstruction. Not only can the financial interest provide evidence of corrupt intent, it may provide a basis for viewing otherwise routine acts of representation as obstruction. In U.S. v. Cueto, a federal agent working undercover as a corrupt state liquor agent had solicited a bribe from the client as part of a sting operation on the client’s illegal gambling operation. The attorney reported the corrupt state agent to the state, asked the state prosecutor to file charges against the agent, and subsequently filed a civil complaint in state court alleging the agent was corrupt. Referring to the attorney’s financial interest in the client’s illegal gambling operation, the court concluded that the attorney’s motions and filings constituted obstruction.
The law does provide a safe harbor under 18 U.S.C. § 1515(c): an attorney cannot be prosecuted for providing lawful, bona fide, legal services. But this safe harbor may provide little help when corruptly impeding legal process is by definition unlawful and otherwise legal motion practice can be “corrupt” in the wrong context. Particularly in agency investigations, where corrupt intent is not required, the risk that an attorney’s presumably lawful, bona fide advice (e.g., that a client need not produce a privileged document) may constitute obstruction is worrisome.
The Oregon Rules of Professional Conduct prescribe the ethical standards for Oregon lawyers. Under the Rules a lawyer cannot assist a client in illegal conduct (Rule 1.2); a lawyer cannot make a materially false statement or omission of fact or law to a third person (Rule 4.1); a lawyer cannot knowingly make a materially false statement to a tribunal (Rule 1.6); and, broadly, a lawyer cannot engage in conduct involving dishonesty or misrepresentation (Rule 8.4).
The Rules of Professional Conduct do not directly address whether or to what extent an attorney must investigate the accuracy of a client’s statements. The Rules require actual knowledge of a misrepresentation, but recognize that knowledge may be inferred from the circumstances. Mere recklessness by an attorney as to the accuracy of his own statement will not subject him to discipline, however.
Upon hearing his client’s mother testify that his client was not the father of her child, an attorney got “an inkling” that paternity was in question and believed further investigation was warranted. Later, without conducting any independent investigation, the lawyer prepared and filed an affidavit for his client, in which the client averred that he was the father. The court concluded that the evidence did not establish that the lawyer knew he was making a misrepresentation and therefore the conduct did not constitute disciplinable conduct.
After conducting only a “cursory” review of a filing, an attorney filed bankruptcy schedules that contained material errors. The attorney considered his role in the filing to be minimal; he did not prepare the filing, sign it, or review the attached bankruptcy schedules for accuracy. He also had not participated in the client’s business operations. The court concluded that the evidence did not establish that the attorney acted “knowing that his conduct was culpable” and therefore the conduct was not disciplinable.
However, the court did conclude that the following evidence was sufficient circumstantial evidence of a knowing misrepresentation in a letter drafted by an attorney to constitute disciplinable conduct: (1) the lawyer had participated in the negotiations underlying the representations in the letter; (2) the lawyer personally vouched for the information in the letter (the letter began with a statement that the accused lawyer’s signature was intended to confirm the representations contained in the letter); and (3) the lawyer admitted that he had read the letter in its entirety with an eye toward confirming the truth of the legal matters it contained and the representation at issue was conspicuously listed and legal in nature.
In summary, a mere suspicion or inkling of a client misrepresentation is not sufficient to trigger a duty to investigate under the Rules. Nor do the Rules generally sanction reckless or careless reliance on client representations. As in the criminal context, however, knowledge may be inferred where a lawyer has vouched for the client or the representation at issue.
Traditionally, the Oregon Bar has enjoyed a congenial relationship with state and federal prosecutors. Many of the cases discussed above come from other jurisdictions. However, to protect both themselves and their clients, lawyers should undertake reasonable precautions to assure that the representations they make to third parties on their clients’ behalves are accurate.
In relying on your client’s statements, especially under exigent circumstances and tight time constraints, you will provide the maximum protection to your client and yourself if you step back and question the facts, viewing them as critically as the lawyer on the other side would. Talk to the key players, review the main documents and determine for yourself if what you are being asked to say or do on your client’s behalf makes sense in terms of the big picture. This assessment does not undercut the lawyer’s duty of zealous advocacy. Rather, it allows the lawyer to better serve the client. Your client may not always have the clearest sense of the facts or what statements are in their best interest, especially when they are betting their company’s or their financial future. It is easy to rush in and advocate for a factual position that—with time to investigate—turns out to be inaccurate. Such misrepresentations imperil both the client’s and the lawyer’s credibility and create possible criminal exposure. It is best in the words of the old cliché to “Stop, Look and Listen” to all the facts before crossing the street.
Of course, even after taking the precaution of stopping, looking and listening to the facts, a lawyer may still unwittingly act as a spokesperson for a client misrepresentation—whether in court or to the press, shareholders, potential investors, or some other third party. Recent fraud and obstruction cases provide examples of steps lawyers can take to minimize the risk that routine acts of representation will result in prosecution and conviction. For example, you should keep detailed log notes of your clients’ statements, the investigations you conduct, and the expert opinions you obtain. You should carefully avoid stepping over the line from advocacy to vouching. If you do become aware your client has implicated you as the lawyer in a fraud or has committed perjury or violated a discovery rule, you must counsel your client of the need to immediately correct the misrepresentation or violation and you must insure the misrepresentation or violation has in fact been corrected. If your client refuses to grant you authority to correct the misrepresentation or violation, you should withdraw. In any event, if you believe your client intentionally used you to perpetrate a fraud, there is a conflict of interest that warrants withdrawal. During a judicial proceeding, when a misstatement occurs, counsel must take steps to immediately correct the misstatement or move to withdraw. If not allowed by the court to withdraw, counsel must ensure that the misstatement is not integrated as part of trial counsel’s advocacy. Lawyers with personal, financial, long-term, or other close relationships with their clients should undertake these steps with extra care.
 Thanks and credit also go to Erin J. Snyder and Adam Gibbs for their assistance with preparation of this article.
 Nix v. Whiteside, 475 U.S. 157, 190 (1986) (Stevens, J. concurring).
 U.S. v. Beckner, 134 F.3d 714 (5th Cir. 1998). Donald Beckner’s client was under investigation by the SEC for fraudulently soliciting investments. The SEC obtained a preliminary injunction preventing the client from soliciting funds unless he used his own assets for security. In apparent compliance, the client continued fund raising by granting collateral mortgages on his residence. In response to suggested irregularities, Mr. Beckner took corrective action, but did not interview investors. Later, after learning that his client was improperly withholding investor files from the SEC, Mr. Beckner withdrew from the representation.
 134 F.3d at 721. Mr. Beckner was tried three times for wire fraud based on these actions before his conviction was reversed on appeal.
 Indictment,U.S. v. Collins, Cr. 01170-LBS-1 (S.D.N.Y Dec. 17, 2007).
 See, e.g., United States Attorney’s Manual (USAM) at 9-2.032, 9-13.420 (notice, search warrant and subpoena requirements); Dec. 10, 1999 Blue Sheet from Assistant Attorney General James K. Robinson (recusal considerations); Department of Justice Criminal Resources Manual at §§ 2306-2307 (civil and criminal forfeiture requirements related to attorneys’ fees).
 USAM at 9-2.032. See U.S. v. Wallach, 935 F.2d 445, 458 (2d Cir. 1991) (overturning conviction of lawyer based on perjured client testimony).
 18 U.S.C. §§ 1341 and 1343. The statutory maximum for mail and wire fraud is 20 years and/or a $250,000 fine (30 years and/or $1 million fine if a bank is involved).
 The mail and wire fraud statutes expressly require a scheme to defraud using the mails or wires and a specific intent to defraud. Id. §§ 1341 and 1343.
 See, e.g., U.S. v. Munoz, 233 F.3d 1117, 1136 (9th Cir. 2000); U.S. v. Beecroft, 608 F.2d 753, 757 (9th Cir. 1979). Of course, evidence of willfulness would also suffice for conviction. Such willfulness is found where there is a “high probability” of fraudulent conduct coupled with a deliberate avoidance of the truth. U.S. v. McDonald, 576 F.2d 1350, 1358 (9th Cir 1978).
 See, e.g., DeMier v. U.S., 616 F.2d 366, 369 (8th Cir. 1980) (citing Calnay v. U.S., 1 F.2d 926 (9th Cir. 1924)).
 In Collins, the four counts of wire fraud are based on four e-mails: one from the law firm’s Chicago office to its New York office, attaching a redline version of a letter from the client to an investor, and three others from the law firm to representatives of investors. Indictment at 51-52, supra note 6. Although the indictment alleges intent to defraud and knowledge of misrepresentations, it does not reveal what facts the government will rely on to prove those elements.
 U.S. v. Albers, 226 F.3d 989, 995 (9th Cir. 2000) (recklessness is deliberate disregard of a substantial and unjustifiable known risk); Farmer v. Brennan, 511 U.S. 825, 837 (1970) (“The criminal law, however, generally permits a finding of recklessness only when a person disregards a risk of harm of which he is aware.”).
 See U.S. v. Petry, 67 Fed. App’x 433, 434 (9th Cir. 2003) (defendant’s failure to confirm terms of his restraining order prior to buying a handgun was reckless); U.S. v. Cusino, 694 F.2d 185, 187 (9th Cir. 1982) (inventor’s failure to confirm claim that invention amplified energy by a 9:1 ratio was reckless).
 See, e.g., U.S. v. Alkins, 925 F.2d 541, 550 (2d Cir. 1991); U.S. v. Williams, 728 F.2d 1402, 1404 (11th Cir. 1984) (failure to give jury instruction that good faith is a complete defense is error where any evidentiary basis exists for defense). Where good faith is recognized as a complete defense, the prosecution has the burden of disproving the defendant’s good faith.
 See, e.g., Cusino, 694 F.2d at 188; U.S. v. Shipsey, 363 F.3d. 962, 967 (9th Cir. 2004).
 Beckner, 134 F.3d at 720.
 Schatz v. Rosenberg, 943 F.2d 485, 495 (4th Cir. 1991).
 Bonavire v. Wampler, 779 F.2d 1011, 1014-15 (4th Cir. 1985).
 Renovitch v. Kaufman, 905 F.2d 1040 (7th Cir. 1990).
 There is no express prohibition on such intermingling of business and professional relations between attorney and client. The Oregon Rules of Professional Conduct prohibit an attorney entering into a business transaction with a client where their interests will be adverse (ORPC 1.8(a)). The Rules also prohibit acquiring a proprietary interest in ongoing litigation (ORPC 18(i)).
 See, e.g., U.S. v. Wolf, 820 F.2d 1499, 1503 (9th Cir. 1987); U.S. v. Olano, 62 F.3d 1180 (9th Cir. 1987).
 For a detailed treatment see, Marc I. Steinberg, The Corporate/Securities Attorney as a “Moving Target,” 46 Washburn L. J. 1 (Fall 2006).
 15 U.S.C §§ 78j(b) and 78ff; 17 C.F.R § 240.10b-5.
 U.S. v. Tarallo, 380 F.3d 1174, 1188-89 (9th Cir. 2004). Attorneys may also be liable under the Securities Exchange Act in SEC enforcement actions and third-party civil actions. 17 C.F.R. § 240.10b-5. Although the Supreme Court reaffirmed last term that there is no private cause of action for aiding and abetting securities fraud, secondary actors such as attorneys can be primarily liable under the Act in both the civil and enforcement contexts. Stoneridge v. Scientific-Atlanta, 128 S.Ct. 761, 771 (2008). Moreover, attorneys can be liable for aiding and abetting securities fraud in the SEC enforcement context. Primary liability can attach to a lawyer who makes a directly attributable statement (such as in an opinion letter) or who drafts an SEC document that the client subsequently files, even if the filing is not signed by or attributed to the lawyer. S.E.C. v. Wolfson, 2008 WL 4053027 at *10 (10th Cir. Sept. 2, 2008). In enforcement actions under section 10b-5, the SEC must prove that the lawyer (or other secondary actor) caused misstatements or omissions to be made with knowledge that those misstatements would reach investors. Id.
 State v. Jacobs, 55 Or. App. 406, 414 (1981).
 See id. (observing without further discussion that prosecutor elected to bring criminal charges pursuant to O.R.S. 161.105(3) provision); see O.R.S. § 165.105(3) (“the culpable commission of [an offense defined by a statute outside the Oregon Criminal Code] may be alleged and proved, in which case criminal negligence constitutes sufficient culpability”).
 O.R.S. §§ 59.991, 59.995, 161.605, and 161.625.
 See 18 U.S.C. § 1519 (providing for fines and a maximum prison term of 20 years); see also id. § 1512(k) (penalty for conspiracy to commit Section 1512 obstruction subjects conspirators to same penalties as those proscribed for the underlying offense).
 Under the traditional obstruction statute,18 U.S.C. § 1503, a grand jury authorized investigation (U.S. v. Aguilar, 515 U.S. 593 (1995)) or civil suit (U.S. v. Lundwall, 1 F.Supp.2d 249 (S.D.N.Y. 1998)) must be underway at the time the obstruction occurred. The defendant also has to know or have notice of the proceeding. U.S. v. Frankhauser, 80 F.3d 641, 650 (1st Cir. 1996).
 18 U.S.C. §§ 1512(f) and 1519.
 Id.§ 1519 (including knowingly destroying a document with the intent to impede an investigation).
 Id.§§ 1512(f) and 1519 (no pending proceeding required); see also Arthur Anderson LLP v. U.S., 544 U.S. 696, 707-708 (2005) (holding that Section 1512 obstruction, which imposes liability for knowingly corruptly obstructing a non-pending official proceeding, requires that the proceeding must have been contemplated by defendant).
 See id. § 1512(f)(2) (the document need not be admissible or free from a claim of privilege).
 See, e.g., id. §§ 1503 (corrupt intent required to obstruct pending judicial proceedings), 1505 (corrupt intent required to obstruct administrative and congressional proceedings and inquiries) and 1512(c) (corrupt intent required to obstruct pending or non-pending judicial proceedings).
 Arthur Andersen, 544 U.S. at 705; see also id. at 705 n.9 (observing that definition of knowingly corruptly may not apply to Sections 1503 or 1505, where the word “corruptly” is not modified by the word “knowingly”) and 707 (“corrupt” conduct cannot be innocent).
 U.S. v. Kellington, 217 F.3d 1084 (9th Cir. 2000).
 Compare U.S. v. Cueto, 151 F.3d 620, 631 (7th Cir. 1998) (facts showing attorney’s financial interest in client’s illegal operation established corrupt intent to obstruct investigation of that operation).
 ORPC 1.2, 4.1, 1.6, and 8.4(a)(3) respectively. ORPC 8.4(a)(3) does not specify a mental state. However, this rule—almost identical in substance to former DR 1-102(A)(3) and (4)—has been interpreted to require knowledge. See, e.g., Formal Opinion No. 2005-34, In re Hoffman, 14 D.B. Rptr. 121 (2000).
 See, e.g., In re Skagen, 342 Or. 183, 203-204 (2006) (recklessness as to accuracy of billing statement not dishonest conduct under ORCP 8.4).
 In re Hawkins, 305 Or. 319, 324 (1988) (client told attorney of factual errors on consent form, which the attorney did not correct prior to filing).
 In re Trukositz, 312 Or. 621, 630-632 (1992).
 In re Conduct of Cobb, 345 Or. 106, 125 (2008).
 In re Conduct of Fitzhenry, 343 Or. 86, 105-06 (2007).
 Cobb, 345 Or. at 125 (discussing DR 1-102(A)(3) and observing that careless or reckless conduct may bring exposure to other forms of liability, but is insufficient to trigger discipline).


Yesterday, the U.S. Supreme Court issued its much anticipated decision in Myriad (Association for Molecular Pathology v. Myriad Genetics). The Court held that naturally occurring DNA segments are products of nature and not patent eligible merely because they have been "isolated." In contrast, the Court held that certain types of synthetic DNA, referred to as cDNA, are patent eligible if distinguishable from natural DNA. Notably, the Court left several questions unanswered by remaining silent on patent eligibility of many commercially relevant forms of synthetic DNA and not addressing the issue of "isolated" molecules more broadly beyond DNA.
The decision is significant, but it does not mean the end for the diagnostics industry and other industries utilizing genomic techniques. The bottom line is: claims to isolated DNA segments that exist in nature are not patent eligible and there likely will be more litigation addressing unresolved issues as to the scope of patent eligibility around synthetic nucleic acids and isolated molecules generally.
In an opinion delivered by Justice Thomas, the Supreme Court addressed whether naturally occurring segments of deoxyribonucleic acid (DNA) are patent eligible under federal statute (35 U.S.C. §101).
The patents at issue, held by Myriad, relate to the discovery of BRCA1 and BRCA2 genes and mutations in these genes that are indicative of an increased risk of breast and ovarian cancers. Myriad offers diagnostic testing in which it evaluates patients' BRCA genes to determine whether they have mutations associated with increased cancer risk. Myriad has essentially been the only entity offering this testing and has leveraged its patents to stop others from practicing similar tests to evaluate the BRCA genes. This lawsuit began when a group of researchers, medical patients, advocacy groups, and doctors interested in Myriad's testing sought a declaration that Myriad's patents are invalid under §101.
In 2010, the U.S. District Court for the Southern District of New York granted summary judgment on Myriad's isolated DNA claims, concluding that the claims were invalid because they covered products of nature. On appeal, the U.S. Court of Appeals for the Federal Circuit (Federal Circuit) reversed, taking the view that isolated DNA is not a product of nature because "isolated" indicates that the DNA has been altered from its natural state due, for example, to cleavage of covalent bonds to isolate the DNA from its natural environment. The Federal Circuit acknowledged that the patents at issue contain both claims encompassing isolated DNA having a sequence present within natural genomic DNA and claims encompassing cDNA having a sequence not found within natural genomic DNA. The Federal Circuit took the view that claims covering either DNA or cDNA, in their isolated forms, are patent eligible.
In 2012, the Supreme Court granted a petition by the plaintiffs for a writ of certiorari, vacating the Federal Circuit's judgment and remanding the case for further consideration in light of its decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc. (see our alert here). After rehearing the case, the Federal Circuit reaffirmed its ruling concerning isolated DNA.
The second time around, the Supreme Court disagreed with the Federal Circuit that "isolating" is sufficient to render DNA patent eligible. Citing its decision in Funk Brothers, the Court reiterated that discovery of a natural principle itself does not meet the §101 patent eligibility standard. Rather, as the Court held in Charkrabarty, for a composition to be patent eligible it must be a "product of human ingenuity having a distinctive name, character and use" with "markedly different characteristics from any found in nature." According to the Court, although Myriad discovered the genomic location of an important and useful gene, "separating that gene from its surrounding genetic material is not an act of invention."
Moreover, according to the Court, Myriad's claims were not "saved by the fact that isolating DNA from the human genome severs chemical bonds and thereby creates a non-naturally occurring molecule." Rather, the Court viewed the claims as being "concerned primarily with the information contained in the genetic sequence, not with the specific chemical composition of a particular molecule." For example, the Court pointed out that Myriad's claims "are not expressed in terms of chemical compositions or did not rely on chemical changes that results of isolating particular sections of DNA," suggesting that if the claims recited chemical features that distinguish DNA produced in a lab from natural DNA, they might have passed muster under §101.
The Supreme Court also dismissed Myriad's arguments that deference should be given to the U.S. Patent and Trademark Office (PTO) and its long-standing practice of claiming isolated nucleic acids, pointing that Congress had not endorsed the views of the PTO through legislation and that the United States, as Amicus Curiae, holds the position that isolated DNA should not be patent eligible under §101.
With regard to Myriad's isolated cDNA claims, the Court held that, to the extent cDNA is distinguishable from natural DNA, it is not a "product of nature" and thus is patent eligible under §101.
The decision is significant because it clarifies that mere isolation is not enough to render claims to naturally occurring DNA patent eligible and because, in effect, it upholds the Court's precedent concerning the patent eligibility of compositions of matter as it relates to products of nature.
The decision leaves open the question of patent eligibility of numerous commercially relevant forms of nucleic acids. These unresolved issues likely will be addressed in subsequent litigations. However, primers, probes, therapeutic oligonucleotides, and other nucleic acids that include non-natural chemical modifications, such as sequence tags and modified backbones or nucleotides, are likely to remain patent eligible. It may be a closer call for synthetic nucleic acids that only have naturally occurring sequences and that are not chemically modified in any way or otherwise distinguishable from natural occurring DNA.
Some patent holders having broad claims to isolated DNA may consider having those patents reissued with narrower claims. Prospective licensees may urge for more favorable royalty terms, whereas existing licensees may seek to renegotiate licenses for more favorable terms. Alleged infringers may be more comfortable challenging validity of the patents under § 101 based on the decision. In general, the ruling may embolden companies to offer further genome sequencing or diagnostic tests because they may perceive a reduced risk of patent infringement.
Finally, because the Court emphasized that "isolation" is not sufficient to render natural DNA fragments patent eligible, the implication of this decision on the patent eligibility of other isolated molecules -- such as isolated RNAs, polypeptides (including antibodies and therapeutic proteins), and others -- is unclear and likely will be addressed in future litigations.


text:
The Court continued: Thus, SASPA protects victims of unwanted sexual contact or lewd acts or attempts to commit the same. A person cannot seek protection against words, threats, or sexual harassment alone under SASPA. Here, the trial court found plaintiff’s account credible and defendant admitted speaking to her. It is clear plaintiff felt threatened by the encounters and the court was concerned for the future risk to plaintiff’s safety and well-being; however, there is no evidence defendant made or attempted to make physical contact with plaintiff. Thus, the question is whether defendant’s 2005 sexual assault can be the basis of a SASPA order. We conclude it cannot.
“Generally, newly enacted laws are applied prospectively.” Johnson v. Roselle EZ Quick LLC (2016). “This approach is based on long-held notions of fairness and due process.” Ibid. (quoting Cruz v. Cent. Jersey Landscaping, Inc. (2008)). One can overcome this presumption by demonstrating the Legislature intended retroactive application. The question then becomes whether enforcement of a retroactive law will “unconstitutionally interfere with ‘vested rights’ or will result in a ‘manifest injustice.'” Ibid. (quoting Twiss v. State (1991)).
Legislative intent of retroactivity can be shown: “(1) when the Legislature expresses its intent that the law applies retroactively, either expressly or implicitly; (2) when an amendment is curative; or (3) when the expectations of the parties so warrant.” Ardan v. Bd. of Review (2018) (quoting James v. N.J. Mfrs. Ins. Co. (2014)). At least one source of intent must be shown before a statute can be given retroactive effect. Legislative intent may be observed expressly in the statute or implicitly in legislative history showing retroactive application is “the most sensible interpretation.” “A statute is curative ‘if it is designed to merely carry out or explain the intent of the original statute,’ in that its purpose is ‘to remedy a perceived imperfection in or misapplication of a statute and not to alter the intended scope or purposes of the original act.'” Ibid. (alteration in original) (quoting Nelson v. Bd. of Educ. (1997)). In absence of legislative intent, courts should examine whether the parties expected the law to apply retroactively.

matches: v. v. v. v. v. v.


text:
Jakki Kouffman, a recent transplant from Santa Fe's painting, exhibiting and teaching scene, is now living in St. Petersburg, Florida. She recently participated in exhibitions at the Morean Arts Center in St. Petersburg, Florida, Dunedin Fine Art Center in Dunedin and the Suntan Art Center in St. Pete Beach.
Kouffman is now showing a 36" x 24" acrylic painting from her Floater series, How Heliconias Dream, and When at Woodfield Fine Art in St. Petersburg, Florida. This invitational show runs through November 30th, 2018.
The Plein Air Painters of New Mexico 10th National Juried Members Exhibition takes place from November 2 - 25, 2018 at the Sorrel Sky Gallery in Santa Fe. As a Signature Member of PAPNM, Jakki will be represented by her acrylic painting Rio Grande Overlook at Questa, a scene that she has painted often, after living, painting and teaching workshops for more than seventeen years in and around Santa Fe.
Opening on November 6 and continuing through March 4, 2019, the Taos Museum at Fechin House will present an exhibition of Signature and Master Signature Members of PAPNM at the 2018-19 Fechin Invitational Winter Exhibition. As a Signature Member, Jakki Kouffman was invited to show her acrylic painting Echo of the Red Rock Glow alongside an inspired group of landscape painters from New Mexico and beyond.
This summer, Jakki Kouffman exhibited an acrylic painting from her Floater series at the 100th Annual Members Show at the Morean Arts Center in St, Petersburg, Florida, July 13 - September 27.
Kouffman also juried her pastel Floater, Eggplants Aloft at Dusk, into the Dunedin Fine Art Center show You Are What You Eat. This exhibition took place from September 7 - October 14, 2018.
In St. Petersburg, Jakki exhibited her pastels and acrylics at Woodfield Fine Art in 2017 - 2018.
Internationally-known acrylic artist Mark Mahaffey awarded Jakki Kouffman's painting the Best in Show Award at the 2018 Spring Juried Exhibition, held at the Suntan Art Center, in St. Pete Beach, Florida. The 36" x 24" piece, Chiles Aloft at Day's End, was recently purchased by a private collector in St. Louis, Missouri.
Kouffman is showing a piece from her Floaters Series at the Member/Student/Faculty Show at the Dunedin Fine Art Center, through May 6.
Jakki Kouffman taught a 6-week course in acrylic painting, as well as a two-day workshop, at the Dunedin Fine Arts Center during the Winter I term. She also showed three paintings at the annual Glad Tidings Exhibitions, where her work was selected for the exhibition show card.
Jakki exhibited a three-part figure drawing at the Drawing Artists Together show at the Morean Arts Center in St. Petersburg. This show commemorated the 40-year commitment by the Morean to their Saturday figure drawing sessions, which Jakki has attended regularly since her arrival in St. Pete in the spring of 2017. Kouffman also showed several several pieces at the annual Morean Holiday Exhibition.
On November 9th, Kouffman presented an art talk at the Dunedin Fine Art Center's Coffee & Conversation series. The lecture recounted the story of her transition from doing stone sculpture and bronze for a year in Pietrasanta - on a grant from her alma mater, Brandeis University - to working in acrylic, pastel and mixed media today.
On November 10 & 11, Jakki taught an acrylic workshop called Acrylic, Meet Your Future Better Half. This course explored how combining color with liquid mediums, solid gels and opaque pastes helps to magnify sheen, transparency, texture and chromatic brilliance in acrylic painting.
Kouffman won 1st Place at the Dunedin Fine Art Center juried show, On Your Mark, which opened on September 22, 2017.
On Saturday, December 2, she participated in DFAC’s annual Demo Day event. Faculty members in every medium and genre set up their easels and workstations to answer questions from prospective students about upcoming winter term classes. Lots of fun meeting all these prospective students!
Kouffman had an acrylic landscape painting selected for the Plein Air Painters of New Mexico 9th National Juried Members Show at Sorrel Sky Gallery in Santa Fe, New Mexico in November, 2017.
At the Morean Arts Center in St. Petersburg, Florida, Jakki showed a painting from her Floaters Series at the 99th Annual Members Show, July 8 - August 18, 2017.

matches:
in Fine
in Fine
in Fine
in Fine
in Fine
in Fine


text:
The Florida Land Environment: Need a Plain-Language Summary of Koontz?
My last post dealt in detail with the my observations following oral arguments in Koontz v. St Johns River Water Management District, No. 11-1447 (argued Jan. 15, 2012). With good timing, the Hillsborough County Bar Association recently published my plain-language introduction to the case in its magazine, Lawyer (p. 41). It's excerpted below for easy reading.
Land use lawyers and urban planners wonder if these questions will be answered now that the U.S. Supreme Court has granted review of Koontz v. St. Johns River Water Management District, No. 11-1447 (cert. granted Oct. 5, 2012). In what could be the most important land use decision in years, Koontz questions common bargaining practices that governments use when negotiating development permits.
An exaction is a government requirement to donate something in exchange for the right to develop property. Generally, the government cannot force landowners to give up the right to exclude others from property in return for the ability to develop it. It can, however, require mitigation of adverse development impacts.
If the mitigation involves access to real property, there must be an “essential nexus” and a “rough proportionality” between the exaction and the interest that the exaction is advancing. Dolan v. Tigard, 512 U.S. 374, 391 (2005); Nollan v. Cal. Coastal Com., 483 U.S. 825, 837 (1987). Otherwise, the government must pay just compensation because the landowner has lost the ability to exclude others from the property.
In Koontz, the government agreed to issue a permit if the landowner would work on government-owned culverts and canals seven miles away. The landowner refused, and the government denied the permit. When the landowner brought an inverse condemnation suit, the trial court and the Fifth DCA found the exaction illegal. The Florida Supreme Court reversed, holding that the Nollan-Dolan test only applied to exactions of real property, where a permit was actually issued imposing the onerous exaction. St. Johns River Water Mgmt. Dist. v. Koontz, 77 So. 3d 1220 (Fla. 2011).
Now, the landowner asks the U.S. Supreme Court if exactions law applies beyond real property. That is, can the government make unreasonable requests for money and for work, when it cannot for property? Second, the landowner asks if a taking can occur where a permit is denied because an applicant rejects an illegal exaction. In other words, does the landowner have to accede to an unreasonable exaction in order to challenge it? This latter question is the more problematic for governments, since it could increase their exposure to takings litigation and limit a lucrative funding source.
These days, Florida is a hotbed of property rights litigation. Three years ago, Florida was defending its beach renourishment program before the U.S. Supreme Court. Stop the Beach Renourishment, Inc. v. Fla. Dep't of Envtl. Prot., 130 S. Ct. 2592 (2010). That case broke new ground when a plurality of justices acknowledged that a court can take property, just as the legislative and executive branches can. Will Florida again be on the forefront of takings law?


text:
An examination of the record discloses that none of the complainants, save one, was assessed with a sufficient amount of taxes, to enable him to bring the case here on appeal, and accordingly, under the doctrine of Russell v. Stansell, 106 U. S. 303, and Gibson v. Shufeldt, 122 U. S. 27, the appeal is dismissed as to such parties.
No jurisdiction vested in the appellant's city council to make an assessment and levy a tax for the improvements which are the subject of this controversy until the assent of the requisite proportion of the owners of the property to be affected had been obtained, and the action of the city council in regard to that question was not conclusive.
In order to justify a court of equity in restraining the collection of a tax, circumstances must exist bringing the case under some recognized head of equity jurisdiction, and this case seems plainly to be one of equitable jurisdiction within that doctrine.
When the illegality or fatal defect in a tax does not appear on the face of the record, courts of equity regard the case as coming within their jurisdiction.
When the authorities have jurisdiction to act, the statutory remedy is the taxpayer's exclusive remedy, but when the statute leaves open to judicial inquiry all questions of a jurisdictional character, a determination of such questions by an administrative board does not preclude parties aggrieved from resorting to judicial remedies.
situated, for the purpose of paving a portion of one of the streets of the city.
To this bill a demurrer was filed, which was sustained by the district court, and a judgment was entered dismissing the bill. On appeal to the supreme court of the territory, that judgment was reversed, and the cause remanded to the court below. 34 P. 53. An answer to the bill was then filed, denying substantially the equities of the bill. Subsequently, on April 9, 1894, a supplemental bill was filed, bringing in additional parties complainant and alleging that, since the filing of the original bill, the defendants had passed the ordinance assessing the properties of the plaintiffs, and were about to expose to sale the real estate described in the original and supplemental bills to satisfy the assessments, and threatened to continue to sell said real estate annually for ten years as each installment of said assessment became due, whereby the plaintiffs had been compelled to pay certain amounts, stated in detail, in order to prevent a sale of their property and to prevent a cloud upon their titles, and that certain real estate belonging to some of the plaintiffs had been sold by the city to satisfy the illegal assessments. The prayers were for a decree declaring the ordinance and assessments to be void, restraining the defendants from proceeding thereunder; that an account be ordered of the amounts paid by plaintiffs under protest; that plaintiffs have judgment for the same; that the sales of real estate be set aside, and for general relief. An answer was filed to the supplemental bill, denying specifically all of its allegations but admitting that the ordinance in question was passed as alleged. It alleged affirmatively that the plaintiffs were estopped to complain as in the supplemental bill alleged; that the same did not state facts sufficient to constitute a supplemental complaint; that the cause of action was barred by the statute of limitations; that there was a misjoinder of parties plaintiff, and that there was a misjoinder of causes of action.
the court below was on appeal affirmed by the supreme court of the territory, from whose decree an appeal was taken and allowed to this Court.
"1. That the plaintiffs were at the date of the filing of the complaint in this action, residents and taxpayers in Ogden City, Weber County, Utah Territory, and brought this action, concerning a matter of general interest to all taxpayers in said Ogden City, on their own behalf and on the behalf of all others similarly situated."
"2. That the defendants, except Ogden City at the time of the bringing of this action, were the mayor and members of the Common Council of said Ogden City, defendant."
"3. That on the 7th day of March, 1892, proceedings were had by the Common Council of said Ogden City, as follows:"
"Finance committee recommending immediate creation of three paying districts, as follows: District No. 2, Twenty-Fifth Street, from the west line of Washington Avenue to the west line of Wall Avenue."
"Councillor Dee moved to lay on the table for one week. Motion lost."
"Councillor McManus moved to adopt the motion. Carried."
"4. That the above were the only proceedings had by said Council of Ogden City in regard to the creation of said paying district prior to the publication of the notice hereinbelow mentioned, and upon the same day the following proceedings were had:"
"Councillor Spencer moved the following motion, in pursuance of the proceedings already taken in ordering the creation of three paving districts:"
"I move that the council adopt the accompanying notice of intention, and that the same be published for twenty days, beginning with to-morrow morning, Tuesday, March 8th."
"Said notice was read, and Councillor Dee moved to lay on the table for one week. Motion lost; Dee and Elliott voting 'Aye;' Calvert, Cannon, Graves, McManus, Shurtliff, and Spencer voting 'Nay.' The original motion was then put and carried; Calvert, Cannon, Graves, McManus, Shurtliff, and Spencer voting 'Aye,' and Dee and Elliott voting 'Nay.' "
"5. That thereupon, on March 9, 1892, in the Ogden Daily Standard, the following notice of intention mentioned above was published, to-wit:"
" Notice of intention of the City Council of Ogden City of creating a district for paving and of paving and macadamizing the streets therein, and to defray the expenses of such improvement by local assessment."
" The City Council of Ogden City, situate in the County of Weber, Territory of Utah, gives notice that it intends to make the following improvements, to-wit, pave and macadamize the following streets: Twenty-fifth Street, from the west line of Washington Avenue to the west line of Wall Avenue. This district shall be known as 'Paving District No. 2.' The boundaries of the district to be affected and benefited are the lines running one hundred and fifty feet back and parallel with the outer lines of each side of the streets on each and every block, and for the full length thereof therein. The estimated cost of such improvement is $40,000. For the payment of the costs and expenses thereof, the city council intends to levy local taxes upon the real estate lying and being within said paving district, and to the extent of the benefits to such property by reason of such improvement. The city council will, on March 29, 1892 at 10 a.m., hear objections in writing and from any and all persons interested in said local assessment. By order of the City Council."
" T. P. Bryan, City Recorder"
frontage on said Twenty-Fifth Street within said district, to-wit, 2,414 feet; that, after said hour of 10 a.m. of said day, certain persons who had protested to the amount of 302 1/4 feet withdrew their protests, leaving at all times 2,111 3/4 feet frontage on said Twenty-Fifth Street in said district still protesting against the said local assessment; that the total number of feet fronting on said Twenty-Fifth Street in said paving district, as mentioned in said notice of intention above set forth, was 3,960, of which 660 feet belonged at said time, and still belong, to said Ogden City, and were then and are now used for public purposes by the said city, and 125 feet of said frontage were then, and are now, the property of the said Ogden City, and was public school property, used and owned for public schools."
"7. That notwithstanding said protest of said abutting property owned on said Twenty-Fifth Street in said Paving District No. 2, and without giving any other or further notice except as hereinbefore stated, the said City Council, on the 4th day of April, 1892, passed the following resolution, to-wit:"
" Resolved, that the city proceed as speedily as possible to the paving of Twenty-Fifth Street district with Utah sandstone blocks; that the city engineer be instructed to prepare the necessary specifications at once, and submit the same at the next meeting of the council; that the competition of said work be restricted to bona fide residents of Ogden, and that, so far as it is possible, only Ogden labor be employed in the performance of the work."
"8. That on May 2, 1893, said City Council of Ogden City passed a resolution instructing the city recorder to advertise for bids for the paving of Twenty-Fifth Street, in said district, which notice was as follows:"
" To paving contractors: bids will be received by the City Recorder of Ogden City until 12 o'clock m. May 23, 1892, for the paving of Twenty-Fifth Street, in Ogden City, from Washington to Wall Avenue, according to the specifications of the city engineer of Ogden City, on file in the City Recorder's office. Competition is restricted to bona fide residents of Ogden City. The city reserves the right to reject any and all bids. Specifications will be furnished on application to the City Recorder. "
"9. That no specifications had been made by the city prior to this time, but afterwards new specifications were made and filed, providing for the paving, grading, and curbing of said Twenty-Fifth Street, and were adopted by the City Council, which specifications provided for the paving of said street with asphaltum and the sides of the street with sandstone blocks and curbing the street, and the contract which was awarded for the doing of said work provided that the contractor should keep the said street in repair for two years after the work upon the same was finished."
"10. That the plaintiffs in this action were at the date of the filing of the complaint herein, to-wit, May 21, 1892, the owners of the real property mentioned in the complaint; but upon the trial of this action it appeared that John Broom and William Chapman were deceased. Samuel Chapman, administrator of the estate of William Chapman, and Hester Broom, administratrix of the estate of John Broom, were substituted as plaintiffs, and said other parties were still the owners of the property mentioned as belonging to them in the complaint in this action."
"11. That said plaintiffs had, upon filing their complaint, obtained a temporary injunction against the said defendants, but afterwards a demurrer to said complaint was sustained by the said court, and said complaint ordered dismissed, which ruling was afterwards by the supreme court of the Territory of Utah reversed, and the said cause was ordered remanded, with directions to the defendant to answer said complaint."
"12. That the said council, in spite of the protest hereinbefore mentioned, proceeded, and at the time of the filing of the complaint in this action had, upon its passage, the ordinance attached as Exhibit B to the complaint in this action, and afterwards, on the 22d day of March, 1893, passed the ordinance which is hereto attached, and marked 'Exhibit A,' and made a part of these findings."
Lindsey R. Rogers, Patrick Healey, Joseph Morely, Zilpha J. Stephens, W. C. Warren, Almira C. Baker, D. H. Stephens, Mary A. Stephens, Elizabeth Stephens, and the Ogden Union Depot & Railway Company, a corporation, be made parties to this action, which supplemental complaint was ordered by the court to be filed; that at the time of the filing of the supplemental complaint, the said parties (except the Ogden Depot & Railway Company, a corporation) were, and still are, the owners of real estate fronting on said Twenty-Fifth Street (and said plaintiff last named was the owner of real estate assessed with said special tax, but not included in said paving district), included in said paving district, and upon the trial of this action D. H. Peery, Jr., and the Realty Company of Kittery, Maine, a corporation, and J. Pingree and Zilpha J. Stephens, Carrie Lewis, and George W. Murphy were added as parties plaintiff, and were at the date, and still are, the owners of real estate in said district fronting on said Twenty-Fifth Street, the pleadings having been allowed to be amended by the court in accordance with such facts."
Geo. M. Kerr, guardian of the Nichols heirs, $160.08; D. H. Peery, Jr., $24; Realty Company, of Kittery, Maine, $748.80; Job Pingree, $35.40; Ogden Union Depot and Railway Company, a corporation, $118.80; Geo. W. Murphey, $154.20."
"15. That said plaintiffs are without any speedy and adequate remedy at law for the recovery of said amounts without a great multiplicity of the suits, and said assessment constitutes a cloud upon the title of the various plaintiffs to their several parcels of realty, and that said city asserts that it will annually, for nine years hereafter, levy assessments upon said real estate for the payment of said paving, and collect the same from the said parties plaintiff, and has already caused to be sold the property of certain of the plaintiffs under and by virtue of said assessment."
"16. That the number of feet frontage in said paving district was 3,300, as the same is described in the ordinance (Ex. A); that the difference between the district described in the ordinance and the district described in the notice of intention consisted of 660 feet of the public property of the said Ogden City, and the lots affected by the said assessment and described in said ordinance varied in depth, some being 75 feet deep, and others 150 feet deep, and that the property owned by the various parties plaintiff in this action varied greatly in depth; that no ascertainment of actual benefits to the property assessed was ever made in order to determine the amount of assessment, or to determine whether the amount assessed exceeded the actual benefits to the property by reason of the improvement, but the cost of the improvement was assessed upon the property abutting and fronting upon Twenty-Fifth Street within the said paving district at an arbitrary rate of $12 per front foot, without any finding or attempt to find the amount of actual benefits to the property; that the said improvement was made without any general plan and form of public improvement having been adopted by the said Ogden City, and the actual benefits to the property assessed for said improvement were not equal and uniform, nor was said assessment equal and uniform. "
The first question to be determined is whether the amount in controversy is sufficient to give us jurisdiction of the appeal.
Although no motion was made to dismiss the appeal, it was suggested at the argument that, as it was not competent to make up the sum necessary to give this Court jurisdiction by uniting the several sums for which each taxpayer was liable, this was such a case, and that therefore we should dismiss the appeal.
Undoubtedly it is the well settled rule of this Court that, in a suit in equity brought in the circuit court by two or more persons on several and distinct demands, the defendant can appeal to this Court as to those plaintiffs only to each of whom more than five thousand dollars is decreed. Russell v. Stansell, 105 U. S. 303, was a case in its facts much like the present one. There, land within a particular district was assessed for taxation, each owner being liable only for the amount wherewith he was separately charged. A bill of complaint was filed by a number of them praying for an injunction against the collection of the assessment, and from a decree dismissing the bill an appeal was taken to this Court. It was held that, while the complainants were permitted, for convenience and to save expense, to unite in a petition setting forth the grievances of which complaint was made, the object was to relieve each separate owner from the amount for which he personally or his property was found to be accountable, and that such distinct and separate interests could not be united for the purpose of making up the amount necessary to give this Court jurisdiction on appeal.
The same conclusion was reached in Gibson v. Shufeldt, 122 U. S. 27, where the previous cases were fully discussed.
An examination of this record discloses that none of the complainants save one were assessed with an amount sufficient to have enabled them to bring the case here on appeal, and accordingly, under the doctrine of the cases cited, this appeal must be dismissed as to such parties.
But it appears that the Realty Company of Kittery, a corporation of the State of Maine, a party complainant in the supplemental bill, had been assessed, under the ordinance complained of, for the sum of $748.80, as an installment for one year, and had been compelled to pay the same, and that the city was threatening to continue said proceedings, and to sell the real estate of said company annually for nine years as each installment for a like sum became due. The liability of that company then, under the ordinance and assessment complained of, amounted to the sum of $7,488, and as that company could, had the decree of the court below been adverse to it, have brought the case here on appeal, so, upon the authorities above referred to, it is competent for the defendant city to do the same.
Upon the merits, the first and most important question to consider is whether the City Council had jurisdiction to assess and collect the paving tax.
to be so improved be not filed with the Recorder, the Council shall be deemed to have acquired jurisdiction to order the making of such improvements."
The bill alleged, the answer admitted, and the trial court found, that the notice of intention to pave in District No. 2, and to defray the expenses thereof by levying a local tax on abutting property owners, was published on March 9, 1892, and in which it was stated that the City Council would on March 29, 1892 at 10 o'clock a.m., hear objections in writing from any and all persons interested in said local assessment.
"That on March 29, 1892, at 9:55 o'clock, D. H. Peery and sixty-eight others, including all the plaintiffs in this action and in the supplemental complaint, who were then owners of real property within the said Paving District No. 2, and with a frontage on Twenty-Fifth Street within the said paving district, filed a protest with the said Recorder of said Ogden City protesting against the levying of any local assessment against or upon their property for the purpose of paving said street within said district; that said persons so protesting owned and protested for more than one-half of the whole frontage on said Twenty-Fifth Street within said district, to-wit, 2,414 feet; that, after said hour of 10 a.m. of said day, certain persons who had protested to the amount of 302 1/2 feet withdrew their protests, leaving at all times 2,111 3/4 feet frontage on said Twenty-Fifth Street in said district still protesting against said local assessment; that the total number of feet fronting on said Twenty-Fifth Street in said paving district, as mentioned in said notice of intention above set forth, was 3,960 feet, of which 660 feet belonged at said time, and still belong, to said Ogden City, and were then, and are now, used for public purposes by said city, and 125 feet of said frontage were then, and are now, the property of the said Ogden City, and was public school property, used and owned for public schools."
action cannot be reviewed in an equitable action to restrain the collection of the tax, but should be reviewed, if at all, by certiorari, in which action the whole record would be removed to the district court.
So far as this proposition involves questions of facts as to the proportion of frontage covered by the protests, we, of course, accept finding on that subject made by the trial court, and approved and adopted by the supreme court of the territory. Stringfellow v. Cain, 99 U. S. 610; Haws v. Victoria Copper Mining Co., 160 U. S. 303.
But the argument seems to be that, when once that question of fact was determined by the City Council, proceeding under the statute, their determination cannot afterwards be challenged in a collateral proceeding; that, while it would not be conclusive in an action by certiorari to set aside the assessment, it is conclusive as against a proceeding by injunction, to prevent the collection of the tax. It is said that the jurisdiction of the City Council attached when, by resolution or ordinance and publication, it gave notice of its intention to make the improvement in question.
We agree with the courts below in thinking that no jurisdiction vested in the City Council to make an assessment or to levy a tax for such an improvement, until and unless the assent of the requisite proportion of the owners of the property to be affected had been obtained, and that the action of the City Council in finding the fact of such assent was not conclusive as against those who duly protested. The fact of consent by the requisite number, in this case, to be manifested by failure to object, is jurisdictional, and in the nature of a condition precedent to the exercise of the power.
"Where the power to pave or improve depends upon the assent or petition of a given number or proportion of the proprietors to be affected, this fact is jurisdictional, and the finding of the city authorities or council that the requisite number had assented or petitioned is not, in the absence of legislative provision to that effect, conclusive. The want of such assent makes the whole proceeding void."
"There is in reality but a single question presented for our consideration in this case, and that is whether, in an action of ejectment brought to recover the possession of lands sold for the nonpayment of taxes levied to defray the expenses of opening Montgomery Avenue generally, and not in obedience to an order of a court of competent jurisdiction to meet some particular liability which had been judicially established, the landowner is estopped from showing, by way of defense, that the petition for the opening presented to the mayor was not signed by the owners of the requisite amount of frontage, and this depends on whether the owner is concluded, (1) by the acceptance of the petition by the mayor and his certificate as to its sufficiency and the action of the board of public works thereunder, or (2) by the judgment of the county court confirming the report of the board of public works."
"This precise question was most elaborately considered by the Supreme Court of California in Mulligan v. Smith, 59 Cal. 206, and decided in the negative, after full argument. With this conclusion we are entirely satisfied. It is supported by both reason and authority."
It is next contended on behalf of the appellant that, if the City Council wrongfully took jurisdiction, in face of the facts shown in or upon the face of its own proceedings, then the tax was absolutely void on its face, and the plaintiffs must seek their remedy at law, and further, if the City Council wrongfully and falsely made its record to show facts sufficient to give it jurisdiction, when such facts never existed, then, in order to get into equity plaintiffs must plead all such facts, and that even in such a case certiorari is, under the laws of Utah, a plain and perfect remedy.
"A suit in equity will not lie to restrain the collection of a tax on the sole ground that it is illegal. There must exist, in addition, special circumstances bringing the case under some recognized head of equity jurisdiction, such as that the enforcement of the tax would lead to a multiplicity of suits or produce irreparable injury, or, where the property is real estate, throw a cloud upon the title of the complainant."
But the present case would seem plainly to be one of equitable jurisdiction within the doctrine of that case. What is complained of is no mere irregularity or error in the assessment. As we have seen, there was an entire want of jurisdiction in the Common Council to proceed for want of the assent of the requisite proportion of property owners, and the assessment and tax were therefore void. That there was no plain and adequate remedy by certiorari would seem to be evident. Upon that writ nothing could have been shown by evidence of facts outside of the record. It is true that, in some of the states, provision is made by statute to bring such evidence in, but such is not shown to have been the case here. It is an admitted fact upon the face of the pleadings that the Common Council actually found that the necessary jurisdictional fact existed, and that such a finding was made a matter of record. The plaintiffs alleged in their bill, and the defendants in their answer denied, that the finding of the jurisdictional fact by the Common Council was not a true finding. Such an issue required evidence dehors the record of the proceedings before the council in order to impeach their finding. The record of this case discloses that a large amount of oral evidence was introduced by the complainants, and admitted without objection by the defendants, to show ownership by the protesting parties and to show that the Common Council were mistaken in finding that the requisite number had not protested.
jurisdiction was properly invoked to prevent a multiplicity of suits, and also to relieve the plaintiffs from a cloud upon their title.
"The said plaintiffs are without any speedy and adequate remedy at law for the recovery of said amounts without a great multiplicity of suits, and said assessment constitutes a cloud upon the title of the various plaintiffs to their several parcels of realty, and that said city asserts that it will annually for nine years hereafter lay assessments upon said real estate for the payment of said paving, and collect the same from the said parties plaintiff, and has already caused to be sold the property of certain of the plaintiffs under and by virtue of said assessment."
If a tax is a lien upon lands, it may then constitute a cloud upon the title, and one branch of equity jurisdiction is the removal of apparent clouds upon the title, which may diminish the market value of the land, and possibly threaten a loss of it to the owner. It is doubtless true that it has been held by this and other courts that if the alleged tax has no semblance of legality, and if, upon the face of the proceedings, it is wholly unwarranted by law, or for any reason totally void, as disclosed by a mere inspection of the record, such a tax would not constitute a cloud, and that the jurisdiction which is exercised by courts of equity to relieve parties by removing clouds upon their titles would not attach.
But when the illegality or fatal defect does not appear on the face of the record, but must be shown by evidence aliunde, so that the record would make out a prima facie right in one who should become a purchaser, and the evidence to rebut this case may possibly be lost or become unavailable from death of witnesses, or when the deed given on a sale of the lands for the tax would be presumptive evidence of a good title in the purchaser, so that the purchaser might rely upon the deed for a recovery of the lands until the irregularities were shown, the courts of equity regard the case as coming within their jurisdiction, and have extended relief on the ground that a cloud on the title existed or was imminent.
Dows v. Chicago, 11 Wall. 108; Hannewinkle v. Georgetown, 15 Wall. 147.
Undoubtedly, for merely irregular assessments, where the authorities have jurisdiction to act, the statutory remedy is also the exclusive remedy. But when the statute, as in this case, leaves open to judicial inquiry all questions of a jurisdictional character, it is well settled that a determination of such questions by an administrative board does not preclude parties aggrieved from resorting to judicial remedies.
"That where there are acts to be performed of a jurisdictional character essential to the validity of the assessment, it is not to be supposed that the conclusiveness of the decision of the board of supervisors is to extend to that class of cases."
"For any defect or irregularity in the course of proceeding in making the assessment -- any ground of objection -- which does not go to show the whole proceeding a nullity, he must take his appeal, if he has one."
presumed that the law furnishes a remedy for illegal taxation. It often happens, however, that the case is such that the person illegally taxed would suffer irremedial damage, or be subjected to vexatious litigation, if he were compelled to resort to his legal remedy alone. For example, if the legal remedy consisted only of an action to recover back the money after it had been collected by distress and sale of the taxpayer's lands, the loss of his freehold by means of a tax sale would be a mischief hard to be remedied. Even the cloud cast upon his title by a tax under which a sale could be made would be a grievance which would entitle him to go into a court of equity for relief."
Numerous cases to the same effect may be found cited in Cooley on Taxation 543.
"any party feeling aggrieved by any such special tax or assessment or proceeding may pay said special tax assessed or levied upon his property, or such installments thereof as may be due at any time before the same shall be delinquent, under protest, and with notice in writing to the city collector that he intends to sue to recover the same, which notice shall particularly state the alleged grievances and grounds thereof, whereupon such party shall have the right to bring a civil action within sixty days thereafter, and not later, to recover so much of the special tax as he shall show to be illegal, inequitable and unjust, the cost to follow the judgment, to be apportioned by the court as may seem proper, which remedy shall be exclusive."
statute and its remedies for errors and irregularities have no application.
Our conclusion is that the decree of the Supreme Court of the Territory of Utah, so far as respects the Realty Company of Kittery, is affirmed, and that as to the other appellees the appeal is dismissed.

matches: v. v. v. v. v. v. v. v. v.


Are Quasi-Class Action Suits By State AGs Removable Under CAFA (Or, For Securities Fraud Cases, Barred By SLUSA)?
A number of courts recently have weighed in on a question we’ve blogged before—whether lawsuits by state attorneys general seeking restitution on behalf of private citizens are subject to removal under the Class Action Fairness Act of 2005 (pdf) (“CAFA”). These rulings have broad implications for the litigation of these quasi-class actions. They also are of substantial importance to determining whether securities fraud actions filed by state attorneys general are precluded by the federal Securities Litigation Uniform Standards Act of 1998 (pdf) (“SLUSA”).
CAFA allows defendants to remove certain significant “class actions” and “mass actions” from state court to federal court. Usually, actions filed by a state acting for itself aren’t removable under CAFA for lack of diversity of citizenship; the state isn’t “a citizen of a state different from any defendant.” 28 U.S.C. § 1332(d)(2)(a). But what if the state is suing to vindicate the financial interests of its private citizens in an action for restitution—a case that looks like a class action, walks like a class action, and quacks like a class action? Is the state still the real-party-in-interest for diversity purposes—or should federal courts consider the private citizens themselves—who actually stand to recover—to be the real-parties-in-interest? According to most courts that have ruled on the issue, the answer depends on whether a single “sovereign” claim in a complaint is enough to exempt the action from removal under CAFA or whether the complaint instead should be analyzed claim by claim to determine removability.
In one recent case—AU Optronics Corp. v. South Carolina (pdf), 699 F.3d 385 (4th Cir. 2012)—the Fourth Circuit held that South Carolina’s suit seeking restitution on behalf of private citizens from manufacturers of liquid crystal display panels for an alleged price-fixing conspiracy does not trigger federal court jurisdiction under CAFA. Although the Fourth Circuit acknowledged that the state sought restitution on behalf of private citizens, it noted that the state was pursuing other, purely sovereign remedies as well, such as forfeiture and penalties. In affirming the district court’s remand to the state court, the Fourth Circuit rejected a “claim-by-claim” approach. Instead, choosing to follow the Ninth and Seventh Circuits’ “whole-case” approach, the Fourth Circuit concluded that the state was the “real party in interest in the lawsuit.” This ruling precludes the removal of what effectively amount to class- and mass-actions when the private plaintiffs (or, often in practice, plaintiffs’ counsel) are able to lobby their state governments to file “quasi-sovereign” enforcement actions seeking restitution.
In contrast, the Fifth Circuit has concluded that although a state’s suit seeking restitution for similar alleged antitrust violations was not a “class action” under CAFA, it was a “mass action” because it sought “monetary relief” for “100 persons or more.” Mississippi ex rel. Hood v. AU Optronics Corp. (pdf), 701 F.3d 796 (5th Cir. 2012). Observing that prior Fifth Circuit precedent “instructs [the courts] to pierce the pleadings and look at the real nature of a state’s claims” on a “claim-by-claim” basis,” the court concluded that “[t]he real parties in interest in Mississippi’s suit are those more than 100 persons . . . who will ultimately benefit from the recovery.” The court thus reversed the district court’s order remanding the case to state court.
For its part, the Second Circuit recently noted the conflict among the circuits in Purdue Pharma L.P. v. Kentucky (pdf), 2013 WL 85918 (2d Cir. Jan. 9, 2013). The Second Circuit declined to weigh in on the issue, however, because—in light of a procedural technicality—the appellant there argued that the suit qualified only as a “class action,” and “not . . . as a ‘mass action’ under CAFA” Id. at *4 n.5. Because the suit there had not been brought under an analogue to Federal Rule 23, the court held that CAFA did not apply, regardless of which approach it might ultimately adopt.
These decisions have implications beyond CAFA. SLUSA prohibits certain state-court securities fraud class actions. 15 U.S.C. § 78bb(f). But similar to CAFA, the statute applies only to suits “by any private party” and in addition includes a savings clause that permits states “to investigate and bring enforcement actions.” Id. In March of this year, the New York Court of Appeals will consider, in People v. Greenberg (pdf) (Index No. 401720/05), whether an action by the state’s attorney general seeking both penalties and restitution on behalf of private citizens is a sovereign “enforcement action” or instead a class action “by [a] private party” within the meaning of SLUSA. In earlier proceedings in the case, the Appellate Division concluded that the action was a permitted sovereign “enforcement action”—thus rejecting the same “claim-by-claim” approach under SLUSA that has divided federal courts in the CAFA context.
What Does Comcast Corp. v. Behrend Mean For Class Action Defendants?