text:
Indian Courts have in several decisions held that matters, in which grave allegations of fraud, conspiracy or misappropriation are made, are too serious to be tried by arbitrators. Therefore, in India, and several other countries, such matters cannot be the subject-matter of arbitration. This view has also been upheld by the Supreme Court of India in N. Radhakrishnan vs Maestro Engineers (“N Radhkrishnan”). The Courts have given various reasons for holding that arbitrators are incompetent to hear such matters. Reputation of the party, ineffectiveness of arbitration where substantial amount of documentary evidence needs to be produced and lack of legal knowledge of the arbitrator, are some of the most cited reasons for limiting the scope of arbitration by such a huge extent. It is also necessary to consider the impact of such a limitation on Indian arbitration law, from an international commercial arbitration perspective.
This article aims to analyze whether arbitration tribunals should be allowed to hear such matters and whether they can function effectively in cases involving fraud. It is to be noted that this article focuses only on fraud, conspiracy or misappropriation that relates only to the issues between parties of a valid arbitration agreement. This article does not dwell into issues which arise when the arbitration agreement itself was obtained by fraud, misrepresentation, coercion, undue influence or on mistake of fact. 'Fraud' wherever used in this article includes conspiracy or misappropriation and other similar acts, but only from the perspective of civil law. It is well settled in law that criminal offences cannot be referred to arbitration, and the author does not dispute the correctness of such a limitation on arbitration.
Part II of this article analyzes the various judgements that have held that matters involving allegations of fraud cannot be tried by arbitrators. It also compares the ratio of the judgements passed under the provisions of The Arbitration Act, 1940 (“the Act of 1940”) with the judgements passed under the provisions of the Arbitration and Conciliation Act, 1996 (“the Act of 1996”). Part III of this article tests, theoretically, the applicability of 'confidentiality' on arbitration proceedings and awards, in India. It also considers confidentiality in arbitration proceedings, as a possible solution to widen the scope of arbitration, thereby bringing allegations of fraud within its ambit. Part IV proposes possible solutions to minimize judicial intervention in cases involving fraud, and also puts forth circumstances in which fraud claims can be tried by arbitrators.
In N Radhkrishnan, the parties before the Supreme Court had entered into a partnership and the partnership deed executed between them contained an arbitration clause. Disputes arose between the partners and letters were exchanged. In these letters, one partner who was the appellant, alleged fraud and serious malpractices by the other document partners and offered to resign from the partnership.
The appellant filed an application before the district court under section 8(1) of the Act of 1996 and requested the district court to refer the dispute to arbitration in light of the arbitration clause in the partnership deed. The district court dismissed the appellant's application to refer the matter to arbitration. On appeal, the Madras High Court also rejected his request for arbitration. The appellant then sought relief from the Supreme Court, but the Apex Court also found against him and dismissed his appeal to refer the dispute to arbitration. The reasoning adopted by the Supreme Court was that such situations cannot be appropriately settled by arbitration.
"Notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part (Part I of the Act), no judicial authority shall intervene except where so provided this Part (Part I of the Act)."
No provision of Part I of the Act of 1996 provides for judicial intervention in cases involving substantial questions relating to facts or those which involve serious allegations relating to fraud and malpractice. It is interesting to note that despite the huge impact of this judgement on section 5 of the Act, the Supreme Court's judgement does not once mention or refer to section 5 of the Act.
In N Radhkrishnan, the Supreme Court relied on Abdul Kadir Shamshuddin Bubere vs Madhav Prabhakar Oak, Haryana Telecom Ltd. vs. Sterlite Industries (India) Ltd. and Oomor Sait Vs. Aslam Sait.
Abdul Kadir Shamshuddin Bubere vs Madhav Prabhakar Oak arose under the Act of 1940. In this case, a three-judge bench of the Supreme Court held that "where serious allegations of fraud are made against a party and the party who is charged with fraud desires that the matter should be tried in open court, that would be a sufficient cause for the court not to order an arbitration agreement to be filed and not to make the reference to the arbitrator."
“(3) On such application being made, the Court shall direct notice thereof to be given to all parties to the agreement other than the applicants, requiring them to show cause within the time specified in the notice why the agreement should not be filed.
Section 20 was the only provision under the Chapter 'Arbitration With Intervention of a Court Where There Is No Suit Pending' of the Act of 1940. In the judgement of Abdul Kadir Shamshuddin Bubere vs Madhav Prabhakar Oak, the Court had the benefit of the wide scope of judicial intervention provided by section 20 of the Act of 1940. Therefore, under the circumstances, it is humbly submitted that this case should not have been relied on by the Court in N Radhakrishnan.
Although the correctness of the order is not doubted, emphasis must be placed on the fact that the Supreme Court passed such an opinion in an order, and not in a judgement, that too without making reference to any precedents, whatsoever. Other relevant factors such as lack of arbitration agreement with certain creditors were not gone into and more emphasis could have been placed on the uniqueness of the nature of winding up proceedings, bringing it out of the scope of arbitration.
The Court upheld the High Court's decision that "since the case relates to allegations of fraud and serious malpractices on the part of respondents, such a situation can only be settled in court through furtherance of detailed evidence by either parties and such a situation cannot be properly gone into by the arbitrator".
In H.G. Oomor Sait And Another vs O. Aslam Sait the Madras High Court held that although it was true that the discretion of the Civil Court to proceed with the suit is narrowed down by the Act, the Court unable read to anything from the Act of 1996 which would place a total embargo on the Civil Court to continue the proceedings before it only on the mere existence of an arbitration clause. A combined reading of all the provisions of the 1996 Act as well as section 8 disclosed that the time-tested reasons which were behind the several judgments of the various Courts as well as the English Courts holding that Civil Court can refuse to stay the suit and can proceed with the suit under certain circumstances continue to hold good even now. The Court acknowledged the short-comings and deficiencies of enquiries before an arbitrator. The Court laid down the reason why, over a century, Courts have repeatedly held that in cases where substantial questions of law arise for consideration or issues which require serious consideration of evidence relating to fraud and misrepresentation etc. are involved, such cases are best left to the civil court and that the arbitrator will not be competent to go into the said issues. It stated that the nature of the enquiry before an arbitrator is summary and that the rules of procedure and evidence are not binding.
In the above case the Court was of the opinion that the Act of 1996 did not remove the abovementioned inadequacies and deficiencies. The Rules of Procedure and evidence are not building on the proceedings before an arbitrator vide Section 19(1) of the Act. The Court agreed that a solemn agreement between the parties to resolve the disputes by an alternative forum before the arbitrator should be strictly complied with. Thus the Court held that disputes involving consideration of substantial questions of law and contested allegations of mala fides, fraud, misrepresentation etc. which depend on adducing of and scrutiny of detailed oral and documentary evidence, then the parties as well as the Civil Court would be justified in ignoring the arbitration clause.
Section 27 of the 1996 Act provides for the arbitrator to seek the assistance of the Court in taking evidence is an example of the admitted deficiencies of a proceeding before the arbitrator. Even after obtaining such assistance from the Civil Court, the arbitrator would still be unable to appreciate the demeanour of the witnesses which is an essential feature of appreciation of oral evidence. Assuming that the grounds of challenge of an arbitration award as provided under the New Act has been narrowed down compared to the old Act, that would be all the more reason why the jurisdiction of the Civil Court to go into such contentions issues like substantial questions of law or serious allegation of fraud etc., requiring detailed evidence, should be properly reserved for a Civil Court to go into and decide.
The Court also entertained the possibility that the arbitrator may not be even a law-knowing person.
The case of Bombay Gas Co. Ltd. vs Parmeshwar Mittal & Others, arose at a time when the proceedings under the Act of 1940 had not yet commenced and the Act of 1996 came into force. The Court said that the provisions of the new Act would apply. The Court in this case held that it is settled position of law that it is the person against whom fraud is alleged has an option to have the matter decided by the Civil Court.
English Courts have also held that in cases of fraud or misconduct or dishonesty or misappropriation of money or negligence involving the professional reputation of a party is charged, the court will in general refuse to send the dispute to arbitration if the party against whom such charges are made desires trial in open court. In the landmark judgement of Russel v. Russell the Court held that in order to oppose reference of the matter for arbitration, the objection to arbitration proceedings must be by the party on whom fraud has been alleged.
In Cunningham Reid v. Buchanan-Jardine, the plaintiff alleged the defendant of wrongful conversion of money. The dispute arose under a contract which contained an arbitration clause. The defendant applied for stay of the suit. The court held that despite the serious charge of fraud, there was no good reason why the normal course of allowing the matter to proceed to arbitration in accordance with the parties' agreement should not be adopted. The Court granted a stay, which was vacated in an appeal by the plaintiff, but was restored in a further appeal by the defendant. In the second appeal the Court held that a stay would be refused almost as of course if the party charged with fraud objected to a stay and wanted to clear his name in open court, but one could not escape from the conclusion laid down by the House of Lords that, if the case was the other way round, ie the party charged with fraud was seeking arbitration and the party charged with fraud was opposing a stay, then even if a strong prima facie case of fraud was made out, that was not by itself enough to warrant refusing a stay. Thus, the party on whom fraud was alleged had the right to choose whether or not to refer the matter for arbitration. It can be inferred that it is the reputation of the party on whom fraud is alleged, which is given importance.
This judgement has been commended by jurists, for it makes a valuable reconciliation between Russel v. Russell and Camita Cotton Oil Co. v. Granadex. S.A. And Tracomin S.A.
In another case, there was an arbitration clause in the contract of employment. The servant sued the master for wrongful dismissal. Since the master gave an undertaking to the court that he will not plead or suggest fraud in the arbitration proceedings, an application for stay was granted in favour of the master and the matter was referred to arbitration.
If factors such as reputation of the party are considered for not referring a matter for arbitration, then perhaps it is also relevant to take into account the level of confidentiality in arbitration proceedings. If arbitration proceedings and awards are made confidential, then it will protect the parties reputation, since allegations of fraud, etc. will not be made public. Conversely, when negative allegations have already entered the public domain, the party on whom such allegations are made may wish to clear his name by making the decision or award public. In such case, making arbitration proceedings and awards confidential will be counter-productive.
Article 30 of the LCIA India Arbitration Rules imposes a general principal of confidentiality in the deliberations, materials and even award in arbitration, and enumerates the limited circumstances in which the disclosure is permitted by the arbitrators and the parties to the arbitration. However, the Act of 1996 only mentions confidentiality only with respect to conciliation.
In England, the concept of confidentiality in arbitration, domestic as well as international, has slowly flourished. Although the English Arbitration Act, 1996 does not have any specific provision relating to confidentiality in arbitration proceedings, the general principles of confidentiality have been laid down in several cases. Thus, in English law, confidentiality is considered as an implied term in arbitration agreements.
It appears that, other than in England, the current trend in international arbitration is to discourage arbitral confidentiality. In the Australian case of Esso Australia Resources Ltd v. The Honourable Sidney James Plowman the court concluded that while confidentiality should be respected, it was not an essential attribute of arbitration. Courts in Sweden and the United States have moved away from a general duty of confidentiality in arbitration. The new French arbitration law states that subject to legal requirements, and unless otherwise agreed by the parties, arbitral proceedings shall be confidential in the case of domestic arbitration. Thus, the requirement of confidentiality in domestic arbitration proceedings is presumed. In the case of international arbitration, the new French arbitration law also provides that the deliberations of the arbitration tribunal must be confidential.
It is humbly submitted that preventing the matter from going into arbitration merely because the arbitrator is not a person having legal-knowledge and may not be aware of rules of procedure and evidence, is not sufficient cause to refrain the parties from proceeding with arbitration. The qualification of the arbitrator may always be an issue, for sometimes the disputes may arise on unforeseeable technical complexities, other than on areas of law. For example, some cases would require the arbitrator to have a high-level knowledge of accounts, architecture, stock markets, a specific area of engineering, etc. Even judges, who may be skilled only in law, must in several case, become experts on other technical aspects. The fact that the arbitrator does not have legal knowledge may affect the choice of the arbitrator, but not the arbitration proceedings itself. Therefore, if parties are restrained from proceeding with arbitration simply because a particular arbitrator is not an expert on the subject-matter of the arbitration, arbitration agreements will not be worth the papers they are printed on.
Even in Justice Bachawat's 'Law of Arbitration & Conciliation' it is stated that, in view of the mandatory provisions of section 8, the objections as to reference to arbitration on the grounds that the action of the defendant amounts to criminal offence and fabrication of the records are without any merit.
The issue of reputation of the parties can be resolved by giving the party on whom the fraud is alleged the option of confidentiality in arbitration proceedings. Since the Act of 1996 does not provide anything about confidentiality of the arbitration proceedings, Courts can adopt the practice of giving the “option of confidentiality”, which would have a minimal interference with the arbitration proceedings, instead of giving the “option of clearing name in open court”. As discussed above, when the arbitration proceedings are made compulsorily confidential it may prove to be counter-productive in cases where allegations of fraud against one of the parties has already entered the public domain. This issue does not arise when such party has the “option of confidentiality”.
In the author's opinion, the most valid reason for limiting the scope of arbitration in cases of fraud is ineffectiveness of arbitration tribunals in processing substantial amount of evidence. It is submitted that this limitation does not arise solely due to the provisions of the Act, but due to practical difficulties in their implementation. Whenever judicial intervention is required in arbitration proceedings, delays are bound to arise. Unfortunately section 27 of the Act of 1996 is a necessary evil. The mechanism for dealing with applications under section 27 is, indeed, in need of improvement.
However, instead of ousting the jurisdiction of the arbitral tribunal, perhaps the Courts could consider referring the matter for arbitration, while holding that the arbitrator, under section 16 of the Act of 1996, had the power to rule that the tribunal did not have jurisdiction, in cases where the evidence was too substantial. Thus, the decision of whether the evidence is too substantial or not, should be left to the arbitrator. This would ensure minimal judicial intervention in arbitration proceedings, and would be in-line with section 5 of the Act of 1996.
Excluding cases involving fraud or those involving large amount of documentary evidence from the scope of arbitration is a huge impediment on the flourishing of arbitration, as a mechanism for alternate dispute resolution, in India. Indian Courts must, as far as possible, refrain from interfering with the arbitral process. Such restrictions on arbitration also discourage parties from selecting the Act of 1996, or any part thereof, as the arbitral law.
However, until Courts change their view regarding fraud allegations and arbitration, or until the Act of 1996 is appropriately amended, parties entering into to an arbitration agreement and legal practitioners drafting such an agreement, must keep in mind the factors such as confidentiality of the arbitral proceedings, with respect to the nature of the possible disputes that may arise.
 Article 30 Confidentiality: 30.1 Unless the parties expressly agree in writing to the contrary, the parties undertake as a general principle to keep confidential all awards in their arbitration, together with all materials in the proceedings created for the purpose of the arbitration and all other documents produced by another party in the proceedings not otherwise in the public domain - save and to the extent that disclosure may be required of a party by legal duty, to protect or pursue a legal right or to enforce or challenge an award in bona fide legal proceedings before a court or other judicial authority.
30.2 The deliberations of the arbitral tribunal are likewise confidential to its members, save and to the extent that disclosure of an arbitrator’s refusal to participate in the arbitration is required of the other members of the arbitral tribunal under Articles 10, 12 and 26.
30.3 The LCIA Court does not publish any award or any part of an award without the prior written consent of all parties and the arbitral tribunal.
 Commenced on 17 April 2010.
 Dolling-Baker v. Merrett  1 WLR 1205; Ali Shipping Corporation v. Shipyard Trogir  EWCA Civ 3054, Emmott v. Michael Wilson & Partners Ltd  EWCA Civ 184.
 Nigel Blackaby, Constantine Partasides, Alan Redfern, Martin Hunter, 'Redfern and Hunter on International Arbitration, 5th Edition, Oxford University Press, (2009) at 2.152.

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


State Finance Law 187-194, False Claims Act (including whistleblower protections.
The Federal False Claims Act is a law that prohibits a person or entity, such as the Hospital from “knowingly” presenting or causing to be presented a false or fraudulent claim for payment or approval to the Federal government, and “knowingly” making, using or causing to be made a false record or statement to get a false or fraudulent claim paid or approved by the Federal government. The Federal False Claims Act also prohibits a person or entity from conspiring to defraud the government by getting a false or fraudulent claim allowed or paid. The term “knowingly” means that a person: 1) has actual knowledge; 2) acts in deliberate ignorance of the truth or falsity of the information; or 3) acts in reckless disregard of the truth or falsity of the information. The law specifically provides that a specific intent to defraud is not required in order to prove that the law has been violated.
This federal law is similar in structure to the False Claims Act, but provides administrative remedies against persons or entities that make or cause to be made a false claim for money, property or services to certain federal agencies including the Department of Health and Human Services, which operates the Medicare and Medicaid programs. The law provides that any person making, presenting, submitting or causing to submit a claim that the person knows or has reason to know is false, fictitious or fraudulent is subject to civil monetary penalties of up to $5000 per false claim and up to twice the amount of the fraudulent claim. The PFCRA uses the same definition of “knows or has reason to know” as used in the False Claims Act and explained above. Violations are investigated by the Department of Health and Human Services and enforcement actions must be approved by the Attorney General.
A. Civil Penalties (NY Social Services Law 145-b).
The services or supplies for which payment was received were not, in fact, provided.
B. Health Care Fraud (Penal Law 177).
Payments that exceed $1,000,000 constitute a class “B” felony.
C. NY False Claims Act (State Finance Law §187-194).
The NY False Claims Act closely tracts the federal False Claims Act. It imposes penalties and fines on individuals and entities that file false or fraudulent claims for payment from any state or local government, including health care programs such as Medicaid. The penalty for filing a false claim is $6,000 -$12,000 per claim and the recoverable damages are between two and three times the value of the amount falsely received. In addition, the false claim filer may have to pay the government's legal fees. The Act allows private individuals to file lawsuits in state court, just as if they were state or local government parties. If the suit eventually concludes with payments back to the government, the person who started the case can recover 25-30% of the proceeds if the government did not participate in the suit or 15-25% if the government did participate in the suit.
D. Social Services Law §145-c Sanctions.
If any person applies for or receives public assistance, including Medicaid, by intentionally making a false or misleading statement, or intending to do so, the person's, the person's family's needs are not taken into account for 6 months if a first offense, 12 months if a second (or once if benefits received are over $3,900) and live years for 4 or more offenses.
E. Social Services Law §145 Penalties.
F. Social Services Law § 366-b. Penalties for Fraudulent Practices.
Any person who obtains or attempts to obtain, for himself or others, medical assistance by means of a false statement, concealment of material facts, impersonation or other fraudulent means is guilty of a Class A misdemeanor. Any person who, with intent to defraud, presents for payment and false or fraudulent claim for furnishing services, knowingly submits false information to obtain greater Medicaid compensation or knowingly submits false information in order to obtain authorization to provide items or services is guilty of a Class A misdemeanor.
G. Penal Law Article 155. Larceny.
The crime of larceny applies to a person who, with intent to deprive another of his property, obtains, takes or withholds the property by means of trick, embezzlement, false pretense, false promise, including a scheme to defraud, or other similar behavior. It has been applied to Medicaid fraud cases. Fourth degree grand larceny involves property valued over $1,000. It is a Class E felony.
Third degree grand larceny involves property valued over $3,000. It is a Class D felony.
Second degree grand larceny involves property valued over $50,000. It is a Class C felony.
First degree grand larceny involves property valued over $1 million. It is a Class B felony.
H. Penal Law Article 175. False Written Statements.
· §175.05, Falsifying business records involves entering false information, omitting material information or altering an enterprise's business records with the intent to defraud. It is a Class A misdemeanor.
§ 175.10, Falsifying business records in the first degree includes the elements of the §175.05 offense and includes the intent to commit another crime or conceal its commission. It is a Class E felony.
§ 175 .30, Offering a false instrument for filing in the second degree involves presenting a written instrument (including a claim for payment) to a public office knowing that it contains false information. It is a Class A misdemeanor.
§175.35, Offering a false instrument for filing in the first degree includes the elements of the second degree offense and must include an intent to defraud the state or a political subdivision. It is a Class E felony.
I. Penal Law Article 176. Insurance Fraud.
Applies to claims for insurance payment, including Medicaid or other health insurance and contains six crimes.
Insurance Fraud in the 5th degree involves intentionally filing a health insurance claim knowing that it is false. It is a Class A misdemeanor.
Insurance fraud in the 4th degree is filing a false insurance claim for over $1,000. It is a Class E felony.
Insurance fraud in the 3rd degree is filing a false insurance claim for over $3,000. It is a Class D felony.
Insurance fraud in the 2nd degree is filing a false insurance claim for over $50,000. It is a Class C felony.
Insurance fraud in the 1st degree is filing a false insurance claim for over $1 million. It is a Class B felony.
Aggravated insurance fraud is committing insurance fraud more than once. It is a Class D felony.
J. NY False Claim Act (State Finance Law §191).
The False Claim Act also provides protection to qui tam relators who are discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of their employment as a result of their furtherance of an action under the Act. Remedies include reinstatement with comparable seniority as the qui tam relator would have had but for the discrimination, two times the amount of any back pay, interest on any back pay, and compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys' fees.
K. New York Labor Law §740.
Under New York’s Labor Law, employers are prevented from taking any retaliatory actions against an employee who in good faith discloses (or threatens to disclose) to a supervisor or to a public body that the employer is violating the law and the violation presents a substantial and specific danger to the public health and safety or constitutes the crime of health care fraud. To bring an action under this provision, the employee must first bring the alleged violation to the attention of the employer and give the employer a reasonable opportunity to correct the allegedly unlawful practice. The law allows employees who are the subject of a retaliatory action to bring a civil action in court and seek relief such as injunctive relief to restrain continued retaliation; reinstatement, back-pay and compensation of reasonable costs. The Act also provides that employees who bring an action without basis in law or fact may be held liable to the employer for its attorney’s fees and costs.
L. New York Labor Law §741.
A health care employer may not take any retaliatory action against an employee if the employee discloses certain information about the employer's policies, practices or activities to a regulatory, law enforcement or other similar agency or public official. Protected disclosures are those that assert that, in good faith, the employee believes constitute improper quality of patient care. The employee's disclosure is protected only if the employee first brought up the matter with a supervisor and gave the employer a reasonable opportunity to correct the alleged violation, unless the danger is imminent to the public or patient and the employee believes in good faith that reporting to a supervisor would not result in corrective action. If an employer takes a retaliatory action against the employee, the employee may sue in state court for reinstatement to the same, or an equivalent position, any lost back wages and benefits and attorneys' fees. If the employer is a health provider and the court finds that the employer's retaliatory action was in bad faith, it may impose a civil penalty of $10,000 on the employer.
Richmond University Medical Center is committed to providing the highest quality care to our patients and conducting our business with integrity and in compliance with applicable federal and state laws and regulations. To this end, we have an extensive Compliance Program in place that we expect all employees and all persons and entities with which we contract to comply.
As a participant in the Medicaid Program, we are obligated to comply with the terms and requirements of the Deficit Reduction Act of 2005 (the “DRA”). In accordance with the DRA, we have adopted written polices for all employees that provide detailed information about the False Claims Act, the Program Fraud Civil Remedies Act, the relevant state laws, the whistleblower protections under such laws and Richmond University Medical Center’s policies for detecting and preventing waste, fraud and abuse.
The DRA also requires that we provide this information to all contractors and agents for your adoption. Accordingly we are attaching our policy to this memo for your distribution to your employees.
Richmond University Medical Center has a no tolerance policy for employees, agents, or vendors who are involved in any unlawful activity. To that end, we expect that you share our goals of eradicating fraud and abuse and, therefore, will comply with your obligations under the DRA. If you have any questions regarding these materials, feel free to contact Administration at 718-818-1234 or visit our website at www.rumcsi.org.
If you suspect any incident or activity to be illegal or unethical you should speak with your supervisor or contact a member of the compliance department so the issue can be investigated and if necessary, corrected.
If you would like to make an anonymous report, you can use the compliance department’s toll-free, 24-hour Anonymous Hotline at 800-826-6762. National Hotline Services, an external communications firm answers the Hotline, so you are not speaking directly with an RUMC employee. A report is then sent to the compliance department for review and investigation. You can call the hotline at a later date to discover the results of your complaint.
Compliance is the responsibility of each and every employed individual at RUMC. It is up to you to maintain RUMC’s integrity and reputation. If you know of or suspect a compliance issue, please place a report – either directly or through the Anonymous Hotline – so that it can be discreetly but properly investigated.
Remember that compliance begins with you.


Defendant was indicted for and pleaded guilty to one count of violating 8 U.S.C. § 1326(a), which prohibits a non-citizen alien from reentering the United States after deportation. The maximum penalty under the statute is two years in prison. Subsection (b) of the statute increases the maximum possible penalty to twenty years in prison if the defendant committed an aggravated felony before deportation. 8 U.S.C. § 1326(b). Defendant's indictment did not allege a violation of § 1326(b), nor did it contain language charging that he had previously committed an aggravated felony.
The district court sentenced defendant to forty-six months in prison, followed by three years of supervised release. That sentence included an enhancement because defendant had a prior aggravated felony conviction. On appeal, defendant argues that the maximum prison term to which he is subject is two years. He contends this limit is consistent with the maximum penalty contained in § 1326(a), which is both the offense alleged in the indictment and the offense to which he pleaded guilty. His argument rests on the United States Supreme Court's recent decision in Apprendi v. New Jersey, 120 S. Ct. 2348 (2000) (to be reported at 530 U.S. 466).
Apprendi held that "[o]ther than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt." Id. at 2362-63 (emphasis added). As defendant acknowledges, and as the language quoted above makes clear, the Apprendi rule is subject to an explicit exception, one the Supreme Court intended to shield its earlier decision in Almendarez-Torres v. United States, 523 U.S. 224 (1998). See Apprendi, 120 S. Ct. at 2361-62.
Interpreting the very statute at issue here, Almendarez-Torres ruled that the existence of a prior conviction is merely a sentencing factor, not a separate element of the offense to which the full panoply of due process protections attach. Id. at 235. As a consequence, the twenty-year prison term set forth in 8 U.S.C. § 1326(b) may apply even where the indictment failed to allege that the defendant had a prior aggravated felony conviction. Id. at 226-27, 235.
Despite expressing misgivings about whether Almendarez-Torres was correctly decided, Apprendi specifically refused to overrule the earlier decision. See Apprendi, 120 S. Ct. at 2362 (stating "[e]ven though it is arguable that Almendarez-Torres was incorrectly decided . . . we need not revisit it for purposes of our decision today to treat the case as a narrow exception to the general rule we recalled at the outset"). Moreover, this court has published two opinions since Apprendi stating that Almendarez-Torres remains binding authority within this circuit. See United States v. Martinez-Villalva, 232 F.3d 1329, 1332 (10th. Cir. Cir. 2000) and United States v. Dorris, 236 F.3d 582, 587 (10th. Cir. Cir. 2000). As we have said before, one panel of this court cannot overrule a decision of another panel. United States v. Hargus, 128 F.3d 1358, 1364 (10th. Cir. Cir. 1997).
Defendant informs that he brings his appeal in part to preserve an argument for the Supreme Court. He has done so. It remains our duty, however, to decide his case under the rule announced in Almendarez-Torres. The judgment of the United States District Court for the District of Colorado is AFFIRMED.


9th Circuit Construes Section 230 Immunity in Suit Against Listserv Operator, 6/24/03.
June 24, 2003. The U.S. Court of Appeals (9thCir) issued its opinion [41 pages in PDF] in Batzel v. Smith, a case involving the application of California's Anti-SLAPP statute to a suit alleging defamation on an internet listserv. The District Court denied a defendant's motion to dismiss under the Anti-SLAPP statute. The Appeals Court, relying upon the federal interactive computer service immunity provision of 47 U.S.C. § 230(c)(1), vacated and remanded.
Background. Defendant Robert Smith is a handyman who was hired by plaintiff Ellen Batzel. Smith wrote an e-mail to the Museum Security Network in which he stated that "A month ago, I did a remodeling job for a woman, Ellen L. Batzel who bragged to me about being the grand daughter of 'one of Adolph Hitler's right-hand men.' At the time, I was concentrating on performing my tasks, but upon reflection, I believe she said she was the descendant of Heinrich Himmler. Ellen Batzel has hundreds of older European paintings on her walls, all with heavy carved wooden frames. She told me she inherited them. I believe these paintings were looted during WWII and are the rightful legacy of the Jewish people." (Paragraph breaks removed.) Batzel disputes Smith's account.
Defendant Ton Cremers, was the Director of Security at the Rijksmuseum in Amsterdam and the sole operator of the Museum Security Network, which maintains a web site and an e-mailed newsletter about museum security and stolen art. He published Smith's e-mail on the Network's listserv. He determined which e-mails to publish. He also made some minor changes to Smith's e-mail. Smith also later stated that he never imagined that his e-mail would be published on the listserv.
District Court. Batzel filed a complaint in U.S. District Court (CDCal) against Smith, Cremers, and others alleging defamation. Federal jurisdiction is based upon diversity of citizenship. Cremers filed a motion to strike under the California Anti-SLAPP statute alleging that Batzel's suit was meritless and that the complaint was filed in an attempt to interfere with his First Amendment rights. The District Court denied his motion. In particular, the District Court held that the Network is not an "interactive computer service" within the meaning of § 230. Cremers filed this appeal.
Statutes. California's Anti-SLAPP (Strategic Lawsuits against Public Participation) statute is codified at Cal. Civ. Proc. Code § 425.16. It provides for the early dismissal of lawsuits that masquerade as ordinary lawsuits, but are brought to deter common citizens from exercising their political or legal rights or to punish them for doing so.
§ 230(c)(1) provides that "No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider."
§ 230 defines "interactive computer service" as "any information service, system, or access software provider that provides or enables computer access by multiple users to a computer server, including specifically a service or system that provides access to the Internet and such systems operated or services offered by libraries or educational institutions."
Court of Appeals. The Appeals Court reviewed the legislative history of § 230, its purposes, and cases that have applied it. The Court was not enthusiastic about the policy justifications for the immunity provision of § 230. Nevertheless, it applied it to vacate the District Court.
The Court wrote that "There is no reason inherent in the technological features of cyberspace why First Amendment and defamation law should apply differently in cyberspace than in the brick and mortar world. Congress, however, has chosen for policy reasons to immunize from liability for defamatory or obscene speech ``providers and users of interactive computer services´´ when the defamatory or obscene material is ``provided´´ by someone else. This case presents the question whether and, if so, under what circumstances a moderator of a listserv and operator of a website who posts an allegedly defamatory e-mail authored by a third party can be held liable for doing so."
The Appeals Court vacated and remanded to the District Court. However, the Appeals Court did not address whether a listserv fits the definition of "interactive computer service". Nor did the Appeals Court conclude that Cremers has § 230 immunity. It concluded that the factual records needs to be further developed. It vacated the District Court.
The Court reasoned that "There is, however, no need here to decide whether a listserv or website itself fits the broad statutory definition of ``interactive computer service,´´ because the language of § 230(c)(1) confers immunity not just on ``providers´´ of such services, but also on ``users´´ of such services. There is no dispute that the Network uses interactive computer services to distribute its on-line mailing and to post the listserv on its website. Indeed, to make its website available and to mail out the listserv, the Network must access the Internet through some form of ``interactive computer service.´´ Thus, both the Network website and the listserv are potentially immune under § 230."
The Court continued, "Critically, however, § 230 limits immunity to information ``provided by another information content provider.´´ § 230(c)(1). An ``information content provider´´ is defined by the statute to mean ``any person or entity that is responsible, in whole or in part, for the creation or development of information provided through the Internet or any other interactive computer service.´´ § 230(f)(3). The reference to ``another information content provider´´ (emphasis added) distinguishes the circumstance in which the interactive computer service itself meets the definition of ``information content provider´´ with respect to the information in question. The pertinent question therefore becomes whether Smith was the sole content provider of his e-mail, or whether Cremers can also be considered to have ``creat[ed]´´ or ``develop[ed]´´ Smith's email message forwarded to the listserv."
"Obviously, Cremers did not create Smith's e-mail. Smith composed the e-mail entirely on his own. Nor do Cremers’s minor alterations of Smith's e-mail prior to its posting or his choice to publish the e-mail (while rejecting other e-mails for inclusion in the listserv) rise to the level of ``development.´´ As we have seen, a central purpose of the Act was to protect from liability service providers and users who take some affirmative steps to edit the material posted. Also, the exclusion of ``publisher´´ liability necessarily precludes liability for exercising the usual prerogative of publishers to choose among proffered material and to edit the material published while retaining its basic form and message."
The Court concluded that "The ``development of information´´ therefore means something more substantial than merely editing portions of an e-mail and selecting material for publication. Because Cremers did no more than select and make minor alterations to Smith’s e-mail, Cremers cannot be considered the content provider of Smith's e-mail for purposes of § 230."
However, the Appeals Court did not then go on to conclude that Cremers has § 230 immunity, and therefore reverse the District Court. It stated that the analysis is further complicated by Smith's statement that he did not expect his e-mail to be published on the listserv. The Appeals Court wrote that "The question thus becomes whether Smith can be said to have ``provided´´ his e-mail in the sense intended by § 230(c). If the defamatory information is not ``provided by another information content provider,´´ then § 230(c) does not confer immunity on the publisher of the information."
The Court provided detailed guidance to the District Court on this question. It vacated the District Court, and remanded to allow the District Court to further develop the facts, and apply this opinion to those facts.
The Appeals Court also addressed at length issues not covered in this article, including jurisdiction and whether the denial of the Anti-SLAPP motion can be appealed prior to final judgment in the underlying case.


text:
A. Every insurer authorized to do business in this state shall annually and quarterly file with the commissioner of insurance a true statement of its financial condition, transactions, and affairs, as hereafter required along with such additional filings as are prescribed by the commissioner for the preceding year, on or before March first of each year, with the National Association of Insurance Commissioners. The statement shall be on forms and shall contain information as required by this Code and by the commissioner of insurance, including supplementals for additional information required by the commissioner of insurance, and shall be verified by the oaths of at least two of the insurer's principal officers. Statements shall also be filed electronically with the National Association of Insurance Commissioners. Any amendments and addendums to the annual statement filing subsequently filed with the commissioner shall also be filed with the National Association of Insurance Commissioners.
B. The annual statement shall be due before the first day of March and show the condition of the company as of the preceding thirty-first day of December. The first quarterly report shall be due prior to May fifteenth and show the condition of the company as of the preceding thirty-first day of March. The second quarterly report shall be due prior to August fifteenth and show the condition of the company as of the preceding thirtieth day of June. The third quarterly report shall be due prior to November fifteenth and show the condition of the company as of the preceding thirtieth day of September.
C. Upon the request of an insurer, the commissioner of insurance shall furnish each such insurer duplicate copies of annual and quarterly forms as next required to be filed.
D. Each such insurer shall file the appropriate National Association of Insurance Commissioners annual statement blank and quarterly statement blank, which shall be prepared in accordance with the National Association of Insurance Commissioners annual statement instructions handbook, and shall follow those accounting practices and procedures prescribed by the appropriate National Association of Insurance Commissioners Accounting Practices and Procedures Manual.
E. In the absence of actual malice, members of the National Association of Insurance Commissioners, their duly authorized committees, subcommittees, and task forces, their delegates, employees of the National Association of Insurance Commissioners, and all others charged with the responsibility of collecting, reviewing, analyzing, and disseminating the information developed from the filing of the annual statement convention blanks shall be acting as agents of the commissioner under the authority of this Section and shall not be subject to civil liability for libel, slander, or any other cause of action by virtue of their collection, review, and analysis or dissemination of the data and information collected from such filings.
F. All financial analysis ratios and examination synopses concerning insurance companies that are submitted to the Department of Insurance by the National Association of Insurance Commissioners Insurance Regulatory Information System shall be confidential and shall not be disclosed by the department.
G. The annual and quarterly statement of an alien insurer shall relate only to its transactions and affairs in the United States unless the commissioner of insurance requires otherwise. The statement shall be verified by the insurer's United States manager or by its officers duly authorized.
H. The commissioner of insurance may suspend or revoke the certificate of authority of any insurer failing to file its annual statement when due or during any extension of time thereof which the commissioner of insurance, for good cause, may grant.
(2) Management discussion and analysis accompanying the annual statement.
(3) Electronic filings with the National Association of Insurance Commissioners.
Acts 1958, No. 125; Acts 1992, No. 811, §1; Acts 1993, No. 558, §1; Acts 1999, No. 1304, §1, eff. July 12, 1999; Acts 1999, No. 1312, §1, eff. July 12, 1999; Redesignated from R.S. 22:1451 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009; Acts 2008, No. 471, §1; Acts 2009, No. 503, §1.
NOTE: Former R.S. 22:571 redesignated as R.S. 22:311 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009.

matches: §1 §1 §1 §1 §1 §1 §1 §1


On March 18, 2019, the Patent Trial and Appeal Board (“PTAB”) of the United States Patent and Trademark Office designated as precedential a Decision on Patent Owner’s Request for Rehearing. Amazon.com, Inc. v. Uniloc Luxembourg S.A., IPR Case No. IPR2017-00948 (PTAB Jan. 18, 2019). The PTAB held that, while a Petitioner may only challenge patent claims in an inter partes review based on prior art patents and publications under 35 U.S.C. §§ 102 and 103, it is nonetheless proper to consider patent eligibility under 35 U.S.C. § 101 for any proposed substitute claims.
35 U.S.C. § 311(b) provides that “[a] petitioner in an inter partes review may request to cancel as unpatentable 1 or more claims . . . under [35 U.S.C. §§ 102 or 103] . . . on the basis of patents or printed publications.” When the PTAB institutes a Petitioner’s challenge, 35 U.S.C. § 316(d) provides a patent owner with the right to propose substitute amended claims: “During an inter partes review . . . the patent owner may file 1 motion to amend the patent . . . . [and] [f]or each challenged claim, propose a reasonable number of substitute claims.” 35 U.S.C. § 318(a) requires that the PTAB “issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner and any new claim added under section 316(d),” and Section 318(b) mandates “the Director [to] issue and publish a certificate canceling any claim of the patent determined to be unpatentable, confirming any claim of the patent determined to be patentable, and incorporating in the patent by operation of the certificate any new or amended claim determined to be patentable.” Notably, this statutory scheme is silent as to whether consideration of the proposed substitute claims is limited to prior-art-publication Section 102 and 103 challenges (as in a Petitioner’s inter partes review challenge itself) or may additionally include consideration of other patentability determinations (such as Sections 101 or 112, as in original prosecution).
Here, patent owner Uniloc filed a Contingent Motion to Amend, seeking to replace three challenged claims with substitute claims, to the extent the challenged claims were found unpatentable on the prior-art grounds in the Petition. The PTAB found the challenged claims unpatentable based on the asserted prior art, but denied the Motion to Amend because the proposed substitute claims are direct to patent ineligible subject matter under 35 U.S.C. § 101.
Uniloc then moved for rehearing, arguing that it is improper to consider Section 101 for substitute claims, in the same way that it is improper to do so for challenged claims.
This decision continues the PTAB’s recent trend of providing guidance through precedential opinions. It confirms the PTAB’s long-standing practice to treat substitute claims akin to application claims in original prosecution, and, in doing so, consider all patentability provisions (including, not only Section 102 and 103 prior art, but also Section 101 patent eligibility and Section 112 written description, indefiniteness, and enablement).
Amazon.com, Inc. v. Uniloc Luxembourg S.A.


During an inspection of your firm located in Farmers Branch, Texas, on August 5, 2015, through August 13, 2015, an investigator from the United States Food and Drug Administration (FDA) determined that your firm markets and distributes the Eclipse MicroPen Elite. Under section 201(h) of the Federal Food, Drug, and Cosmetic Act (the Act), [21 U.S.C. § 321(h)], these products are devices because they are intended for use in the diagnosis of disease or other conditions or in the cure, mitigation, treatment, or prevention of disease, or to affect the structure or any function of the body.
Our inspections, and review of materials collected during the inspections, revealed that the Eclipse MicroPen Elite is adulterated under section 501(f)(1)(B) of the Act, 21 U.S.C. § 351(f)(1)(B), because you do not have an approved application for premarket approval (PMA) in effect pursuant to section 515(a) of the Act, 21 U.S.C. § 360e(a), or an approved application for an investigational device exemption (IDE) under section 520(g) of the Act, 21 U.S.C. § 360j(g). The Eclipse MicroPen Elite is also misbranded under section 502(o) the Act, 21 U.S.C. § 352(o), because you did not notify the Agency of your intent to introduce the device into commercial distribution, as required by section 510(k) of the Act, 21 U.S.C. § 360(k).
Specifically, FDA has reviewed product labeling for the Eclipse MicroPen Elite, including your firm’s website located at www.eclipseaesthetics.com, brochures, and pamphlets, which revealed that the Eclipse MicroPen Elite system allows for controlled collagen induction therapy by creating micro injuries in the skin which trigger new collagen synthesis, and is marketed to treat conditions such as the appearance of moderate to deep wrinkles and stretch marks.
Based on FDA’s review of the documents collected during the above-referenced inspection, including our review of your firm’s website, the Eclipse MicroPen Elite appears to consist of a stamp of needles that is controlled by a motor in order to make multiple controlled-depth penetrations perpendicularly into the skin while the operator moves the Eclipse MicroPen Elite across the skin surface.
We also note that Eclipse MicroPen Elite labeling indicates that it is a Class I FDA registered device for microdermabrasion and the treatment of scars; the device is listed with FDA as Powered Dermabrasion Device classified under 21 CFR 878.4820. In general, devices classified under 21 CFR 878.4820 are exempt from premarket notification. Generic devices of this type have abrasion substrates, which are brushes, rasps, and burrs that are intended to abrade and remove layers of the skin via shear force. Unlike the 510(k) exempt powered dermabrasion brushes, the Eclipse MicroPen Elite is intended to achieve its clinical effect by penetrating the skin.
At this time, the safe ranges for needle lengths, penetration depths, and speeds of the device are unknown. Therefore, FDA has safety concerns regarding the potential for the needles to damage vessels and nerves. The Eclipse MicroPen Elite employs a different fundamental scientific technology than a device classified under 21 CFR 878.4820. Therefore, the Eclipse MicroPen Elite exceeds the limitations of exemptions from section 510(k), described in 21 CFR 878.9(b), and it is not exempt from premarket notification.
For a device requiring premarket approval, the notification required by section 510(k) of the Act, 21 U.S.C. § 360(k), is deemed satisfied when a PMA is pending before the Agency. 21 CFR 807.81(b). The kind of information you need to submit in order to obtain approval or clearance for your device is described on the Internet at http://www.fda.gov/cdrh/devadvice/3122.html. The FDA will evaluate the information you submit and decide whether your product may be legally marketed.
Our office requests that your firm immediately cease activities that result in the misbranding and/or adulteration of the Eclipse MicroPen Elite, such as the commercial distribution of the device for the uses discussed above.
Your firm’s response should be sent to: Dallas District Office, 4040 North Central Expressway, Suite 300, Dallas, Texas 75204. If you have any questions about the contents of this letter, please contact: Jeff R. Wooley, Compliance Officer at 214-253-5251.