2)  TAXATION:  Morrissey v. CIR, 99-71013 (9th Cir. Mar. 15, 2001).  Where the Commissioner abandons his valuation of stock owned by an estate, the tax court should look to actual sales of stock between willing and knowledgeable buyers and sellers as evidence of the stock's fair market value.  Hug, Noonan (author), and W. Fletcher, Circuit Judges.  D. Duez of Chicago, IL, for the petitioners-appellants;  M. Erickson of Washington, DC, for the respondent-appellee. (Download the full text at www.ce9.uscourts.gov/) 

3)  TAXATION:  Redlands Surgical Services v. CIR, 99-71253 (9th Cir. Mar. 15, 2001).  Adopting the tax court's finding that Redlands had "ceded effective control over the operations of the partnership and the surgery center herein at issue to private parties, thereby conferring impermissible private benefit, the USCA held that Redlands was not operated exclusively for exempt purposes with the meaning of IRC Sec. 503(c)(3);  The USCA also affirmed the tax court's conclusion that the benefit conferred on private parties by the surgery center barred it from attaining tax exempt status under the integral part doctrine.  Browning, Brunetti, and Hawkins, Circuit Judges.  D. Mancino of Los Angeles, CA, for the petitioner-appellant;  P. Junghans of Washington, DC, for the respondent-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

4)  TAXATION:  Fior D'Italia v. USA, 99-16021 (9th Cir. Mar. 7, 2001).  In assessing taxes on unreported tip income, the IRS exceeded its authority by using an aggregate method of assessment;  dissenting, Judge McKeown thought the IRS had simply devised a practical means of calculating tip income.  Kozinski (author), Kleinfeld, and McKeown (dissenting), Circuit Judges.  J. Meyer of Washington, DC, for the appellant;  T. Power of Arlington, VA, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

5)  ENVIRONMENTAL LAW / CLEAN WATER ACT: Headwaters, Inc. v. Talent Irrigation District, 99-35373 (9th Cir. Mar. 12, 2001).  The fact that under the Federal Insecticide, Fungicide, and Rodenticide Act, the EPA approved a label for Magnacide H, an aquatic herbicide containing a pollutant as an active ingredient, did not obviate an irrigation district's need to acquire a National Pollution Discharge Elimination System permit before applying Magnacide H to its irrigation canals.  Boochever (author), Trott, and Berson, Circuit Judges.  C. Tebbutt of Eugene, OR, for the plaintiffs-appellants;  R. Cowling of Medford, OR, for the defendant-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

6)  ENVIRONMENTAL LAW:  Ober v. Whitman, 98-71158 (9th Cir. Mar. 23, 2001).  The U.S. Environmental Protection Agency has the power to make de minimis exemptions to controls under the 1990 amendments to the Clear Air Act;  based on the its explanation of its actions, the EPA could adopt the de minimis levels for PM-10 pollution from the new source review program.  Boochever (author), Brunetti, and Thomas, Circuit Judges.  J. Anderson of Phoenix, AZ, for the petitioners;  K. Egbert of Washington, DC, for the respondents.(Download the full text at www.ce9.uscourts.gov/) 

7)  ENVIRONMENTAL LAW:  San Diego v. Whitman, 00-56561 (9th Cir. Mar. 13, 2001).  A letter from the U.S. EPA in response to a municipality's question regarding whether a federal statute will be applied to the municipality's application for renewal of a permit to discharge pollutants does not constitute a "final agency action" subject to judicial review.  Pregerson, Canby, and Thompson (author), Circuit Judges.  M. McDermott of Washington, DC, for the defendants-
appellants;  J. Reese of Los Angeles, CA, for the plaintiff-appellee. (Download the full text at www.ce9.uscourts.gov/) 

8)  ENVIRONMENTAL LAW:  Natural Resources Defense Council v. Abraham, 00-70015 (9th Cir. Mar. 28, 2001).  The USCA lacked jurisdiction to review Department of Energy Order 435.1 regarding the management of radioactive waste at federal defense facilities as the Order was not a decision "under" the Nuclear Waste Policy Act.  Rymer (author), Thomas, and McKeown, Circuit Judges.  D. Adelman of Washington, DC, for the petitioners;  L. Jones of Washington, DC, for the respondents. (Download the full text at www.ce9.uscourts.gov/) 

 9)  INSURANCE LAW:  American Medical International, Inc. v. National Union Fire Insurance Co. of Pittsburgh, 97-56562 (9th Cir. Mar. 27, 2001).  In a coverage dispute over an excess "directors and officers" ("D&O") insurance policy, the USCA held that as the primary D&O policy excluded coverage for losses from claims filed by former directors, the excess insurer did not breach the implied covenant of good faith and fair dealing by denying coverage to a former director who sued the insured in his capacity as a "potential purchaser" of American Medical International and who alleged damages based on the denial of his bid.  Boochever, Trott, and Berzon (author), Circuit Judges.  P. Abrahams of Encino, CA, for the defendant-appellant;  R. Oster of Los Angeles, CA, for the plaintiff-appellee. (Download the full text at www.ce9.uscourts.gov/) 

10)  INSURANCE:  TCI Group Life Insurance Plan v. Knoebber, 98-17122 (9th Cir. Mar. 26, 2001).  In a dispute over the pro-ceeds of a life insurance policy, a district court abused its discretion in failing to set aside a default judgment and reach the merits where the widow of the insured failed to respond to a complaint or cross-claim during a time of extreme personal difficulty.  Kleinfeld, Tashima, and Berzon (author), Circuit Judges.  G. Kickliter of Tampa, FL, for the appellant;  J. Lewis of Oakland, CA, for the appel-lee.  (Download the full text at www.ce9.uscourts.gov/) 

11)  INSURANCE / ERISA:  Boston Mutual Insurance v. Murphree, 99-16239 (9th Cir. Mar. 12, 2001).  The coordination provision of an employee health plan governed by ERISA may not coordinate medical benefits with a participant's under-insured motorists coverage absent clear language specifically referencing underinsured motorist insurance.  Bright, Reinhardt, and Silverman (author), Circuit Judges.  F. Berry of Phoenix, AZ, for the plaintiff-appellant;  S. Salmon of Phoenix, AZ, for the plaintiffs-appellees.  (Download the full text at www.ce9.uscourts.gov/) 

12)  BANKRUPTCY:  In re Hunt Crow Winthrop Operating Partnership, 99-55584 (9th Cir. Mar. 1, 2001).  A bankruptcy court properly considered the validity of a change in ownership provision in a settlement agreement on a motion rather than in an adversary proceeding;  the USCA held that when the bankruptcy court issued an order invalidating the change of ownership provision under 11 USC Sec. 365(f), it was simply determining the legal effect of its initial order approving contract assignment under Sec. 365.  Browning, T.G. Nelson, and Silverman, Circuit Judges.  R. Rus of Irvine, CA, for the appellants  B. Shumener of Los Angeles, CA, for the appellees.(Download the full text at www.ce9.uscourts.gov/) 

13)  BANKRUPTCY / ERISA:  In re Bagwell, 99-55777 (9th Cir. Mar. 26, 2001).  ERISA fiduciaries are also fiduciaries within the meaning of 11 USC Sec. 523(a)(4) of the Bankruptcy Code, but the specific allegations of breach of ERISA fiduciary duties no not constitute defalcations with the meaning of Sec. 523(a)(4).  B. Fletcher, Ferguson, and Thomas (author), Circuit Judges.  E. Doyle of Pasadena, CA, for the appellants;  A. Kornfield of Los Angeles, CA, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

14)  BANKRUPTCY:  In re Sanchez, 99-56225 (9th Cir. Mar. 5, 2001).  The debtor's attorney did not violate the automatic stay provision of 11 USC Sec. 362 by collecting fees for post-petition services in an amount greater than the bankruptcy court would later determine to be reasonable where the attorney had no reason to know that the court would find his fees excessive.  Schroeder (author), Noonan, and W. Fletcher, Circuit Judges.  H. Shilberg of San Diego, CA, for the appellant;  D. Bokovoy of San Diego, CA, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

15)  EMPLOYMENT DISCRIMINATION:  Owens v. Kaiser Foundation Health Plan, Inc., 99-56466 (9th Cir. Mar. 26, 2001).  Title VII claims are not exempt from the res judicata doctrine where the plaintiffs neither sought a stay for the purpose of pursuing Title VII administrative remedies nor attempted to amend their compliant to include the Title VII claims.  Alarcon (author), Brunetti, and Hawkins, Circuit Judges. D. Spivak of Beverly Hills, CA, for the appellants;  J. Breslo of Los Angeles, CA, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

16)  EMPLOYMENT DISCRIMINATION:  Foss v. Thompson, 99-35956 (9th Cir. Mar. 16, 2001).  A plaintiff alleging employment discrimination who presents no evidence that others outside his protected class were treated more favorably, fails to make a prima facie case of age or race discrimination;  a plaintiff who presents insufficient evidence of the composition of the qualified population in the relevant labor market fails to make a prima facie case of disparate impact;  here, the plaintiff's statistics did not show that the sex disparity in the relevant labor market was significant.  dissenting, Judge Kleinfeld concurred in the majority opinion except as to whether the plaintiff established a genuine issue of fact as to disparate impact;  he noted that the employer required for the position at issues in the office at issue (but not in most of its other offices) that effectively and practically limits the job to persons of one sex;  that, he thought, was enough to allow a trier of fact to infer that the requirement causes a disparate impact based on sex.  Kozinski and Kleinfeld (dissenting), Circuit Judges, and Schwarzer (author), District Judge.  W. Goode of Portland, OR, for the plaintiff-appellant;  AUSA H. Sundby of Portland, OR, for the defendant-appellee. (Download the full text at www.ce9.uscourts.gov/) 

17)  EMPLOYMENT DISCRIMINATION:  Rene v. MGM Grand Hotel, Inc., 98-16924 (9th Cir. Mar. 29, 2001).  A plaintiff who alleges discrimination based on sex under Title VII of the 1964 Civil Rights Act may not defeat a summary judgment motion where his evidence  supports only the claim that he was discriminated against because of his sexual orientation;  dissenting, Judge Nelson found the issue to be whether countless sexual assaults of an openly gay employee by mail co-workers over the course of more than two years can constitute discrimination on the basis of sex;  she thought such conduct did constitute discrimination on the basis of sex.  Hug (author), D.W. Nelson (dissenting), and McKeown, Circuit Judges.  R. Segerblom of Las Vegas, NV, for the appellant;  E. Youchah of Las Vegas, NV, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

18)  SEXUAL HARASSMENT IN THE WORKPLACE: Tennison v. Circus Circus Enterprise, Inc., 99-16385 (9th Cir. Mar. 26, 2001).  In a sexual harassment suit, the trial court did not abuse its discretion by excluding evidence of alleged harassment of other employees occurring in 1988 and 1989 where the danger of unfair prejudice to the defendant outweighed the probative value of the evidence.  Boochever (author), O'Scannlain, and Tashima, Circuit Judges.  J. Tofano of Las Vegas, NV, for the plaintiffs-appellants;  C. Ferenbach of Las Vegas, NV, for the defendants-appellees.  (Download the full text at www.ce9.uscourts.gov/) 

19)  LABOR ARBITRATION:  Hawaii Teamsters, Local 996 v. United Parcel Service, 99-17079 (9th Cir. Mar. 7, 2001).  In an arbitration challenging the summary discharge of an employee, an award based on the arbitrator's interpretation of the collective bargaining agreement's list of cardinal infractions drew its essence from the collective bargaining agreement;  the only issue on appeal was whether the arbitrator even arguably construed or applied the CBA, not whether he did so correctly;  dissenting, Judge Pregerson did not think the arbitrator's award was based on a plausible interpretation of the CBA.  Pregerson (dissenting), Hawkins, and McKeown (author), Circuit Judges.  D. Rosenfeld of Oakland, CA, for the petitioner;  E. Moore of Honolulu, HI, for the respondent. (Download the full text at www.ce9.uscourts.gov/) 

20)  LABOR LAW ATTORNEYS' FEES:  Roy Allan Slurry Seal, Inc. v. Laborers International Union, Local 1184, 99-55883 (9th Cir. Mar. 2, 2001).  The Labor Management Relations Act preempts Cal. Civil Code Sec. 1717 where attorneys' fees are not available under a collective bargaining agreement but could be available through the operation of Sec. 1717;  a fee award under Sec. 1717 would read a new term into the CBA.  Canby, McKeown (author), and Paez, Circuit Judges.  J. Sackman of Los Angeles, CA, for the appellants;  B. Pelliconi of Los Angeles, CA, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

21)  FAIR LABOR STANDARDS ACT:  Gieg v. Howarth, 00-35247 (9th Cir. Mar. 30, 2001). Under the circumstances of this case, a "finance writer" employed by an auto dealership, whose primary duties were selling financing and warranties rather than vehicles, did not qualify as a vehicle salesman or serviceman within the overtime exemption of 29 USC Sec. 213(b)(10).  Pregerson, Thomas (author), and Gould, Circuit Judges.  J. Koch of Portland, OR, for the appellant;  R. Schnitz of Newport Beach, CA, for the ap-pellees.  (Download the full text at www.ce9.uscourts.gov/) 

22)  OSHA:  Chao v. Symms Fruit Ranch, 98-71513 (9th Cir. Mar. 9, 2001).  Where the Secretary of Labor has issued a citation, OSHA retains the authority to decide that even if a safety regulation has been violated, application of that regulation to the circumstances is so far removed from any legitimate safety concern that the violation can be deemed de minimis.  Reavley (author), Fernandez, and Thomas, Circuit Judges.  L. Grabel of Washington, DC, for the petitioner;  C. Dale of Boise, ID, for the respondents.  (Download the full text at www.ce9.uscourts.gov/) 

23)  FORECLOSURE / REAL ESTATE:  Albano v. Norwest Financial Hawaii, Inc., 99-16109 (9th Cir. Mar. 30, 2001).  Under the laws of Hawaii, once the plaintiffs allowed the state court to proceed to a final judgment of foreclosure against them, any right they had to rescind the underlying mortgage transaction vanished.  B. Fletcher, Fernandez (author), and Paez, Circuit Judges.  G. Dubin of Honolulu, HI, for the plaintiffs-appellants;  B. Lamon of Honolulu, HI, for the defendant-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

24)  GOVERNMENT LAW:  On the Green Apartments v. Tacoma, 98-35976 (9th Cir. Mar. 12, 2001).  A municipal ordinance did violates the Commerce Clause by restricting the ability of residents and businesses to haul and dump their own garbage at a city owned and operated landfill;  concurring, Judge Reavley would hold that the plaintiff lacked standing to contest the municipal ordinance for the reason that their allegations do not implicate the Commerce Clause.  Reavley (concurring), O'Scannlain (author), and Gould, Circuit Judges.  J. Schmidt of Seattle, WA, for the plaintiff-
appellant;  R. Jenkinson of Tacoma, WA, for the defendant-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

25)  FREEDOM OF INFORMATION ACT:  Lissner v. U.S. Customs Service, 99-56465 (9th Cir. Mar. 12, 2001).  The FOIA requires the government to provide information about an incident in which the Customs Service arrested, detained and fined California police officers for smuggling steroids into the United States.  Leavy, Trott (author), and Silverman, Circuit Judges.  T. Tuchin of San Diego, CA, for the appellant;  J. Luymes of Santa Ana, CA, for the appellees.  (Download the full text at www.ce9.uscourts.gov/) 

26)  QUI TAM ACTIONS:  USA ex rel Lujan v. Hughes Aircraft Co., 00-55328 (9th Cir. Mar. 22, 2001).  The USCA held that Sec. 3730(b)(5) of the False Claims Act establishes an exception-free, first-to file bar, that subsequently dismissed cases constitute pending actions under Sec. 3730(b)(5), and that a "material facts," not an "identical facts" test should be used to determine if a related action is based on the facts underlying the pending action.  Leavy, Trott, and Silverman (author), Circuit Judges.  D. Davidson of Washington, DC, for the plaintiff-appellant;  M. Troy of Los Angeles, CA, for the defendant-appellee. (Download the full text at www.ce9.uscourts.gov/) 

27)  EVIDENCE:  Oleszko v. State Compensation Ins. Fund, 99-15207 (9th Cir. Mar. 20, 2001).  The federal psychotherapist-patient privilege protects for disclosure communications between an employee and unlicensed employee assistance program counselors.  D.W. Nelson (author), Thompson, and Trott, Circuit Judges.  P. Lomhoff of Oakland, CA, for the plaintiff-appellant;  D. Bacon of Los Angeles, CA, for the defendants-appellants;  B. Celebrezze of San Francisco, CA, for the defendant-appellees. (Download the full text at www.ce9.uscourts.gov/) 

28)  TORTS:  Clamor v. USA, 00-15124 (9th Cir. Mar. 2, 2001).  A government employee who had finished work and was driving away from his work site was not acting within the scope of his employment at the time he was involved in an auto accident;  dissenting, Judge Tallman thought that the employee was still acting within the scope of his employment at the time of the accident.  Kleinfeld, Hawkins (author), and Tallman (dissenting), Circuit Judges.  R. Turbin of Honolulu, HI, for the appellant;  J. Cox of Honolulu, HI, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

29)  QUALIFIED IMMUNITY:  Deorle v. Rutherford, 99-17188 (9th Cir. Mar. 16, 2001).  A police officer who deliberately shoots an unarmed individual with a "less lethal" lead-filled "beanbag" at close range and without warning uses exces-
sive force violative of the Fourth Amendment and is not entitled to qualified immunity;  dissenting, Judge Silverman noted that the beanbag was not designed to kill or injure but to prevent serious injury and the evidence was that it was fired at the plaintiff's abdomen but it "flew up" and unex-pectedly and unintendedly his face;  Judge Silverman sees as undisputed facts that the officer, without warning, used a degree of force that was not reasonably likely to cause death or serious injury, against a deranged man whose behavior prompted his wife to call 911, who police saw in possession of a board with protruding nails, then two hatchets, then a crossbow, and who was then advancing toward the office with a can of flammable liquid while declaring his intention to do the officer harm;  Judge Silverman thus thought the officer was entitled to qualified immunity because a reasonable officer could have believed that his conduct was lawful.  Bright, Reinhardt (author), and Silverman (dissenting), Circuit Judges.  L. Baumbach of Chico, CA, for the plaintiff-appellant;  M. Deems of Chico, CA, for the defendants-appellees. (Download the full text at www.ce9.uscourts.gov/) 

30)  FOREIGN SOVEREIGN IMMUNITIES ACT: Corzo v. Banco Central de Reserva del Peru, 00-55084 (9th Cir. Mar. 12, 2001).  A sovereign's amenability to suit in the courts of its own country does not automatically subject it to jurisdiction in the United States;  concurring, Judge Silverman noted that in this case, foreign sovereign immunity was invoked, not to protect a foreign instrumentality from U.S. courts, but from its own courts; this suit was brought to enforce a judgment already rendered against the Peruvian Central Bank, in Peru, by Peruvian courts;  Judge Silverman thought that the application of foreign sovereign immunity in these circumstance was at cross purposes with international comity and respect for sovereign nations, the principles underlying foreign sovereign immunity.  Leavy, Trott (author), and Silverman (concurring), Circuit Judges.  V. Moneymaker of Los Angeles, CA, for the appellants;  D. Floyd of Los Angeles, CA, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

31)  JURISDICTION:  United National Insurance Co. v. R&D Latex Corp., 99-55259 (9th Cir. Mar. 15, 2001).  Where a district court makes statements in an OSC, clearly contemplating that a plaintiff properly plead diversity, the USCA lacked jurisdiction over an appeal until a final judgment in entered by the district court.  Noonan, Trott and Berzon (author), Circuit Judges.  M. Prough of Walnut Creek, CA, for the appellants;  J. Shaeffer of Los Angeles, CA, appellee.  (Download the full text at www.ce9.uscourts.gov/) 

32)  JURISDICTION:  Natural Resources Defense Council v. Southwest Marine Inc., 00-55621 (9th Cir. Mar. 20, 2001).  In order to preserve the status quo, the district court had the jurisdiction and discretion to make certain post-appeal modifications that slightly modified and enforced an injunction.  Pregerson, Canby (author), and Thompson, Circuit Judges.  D. Mulliken of San Diego, CA, for the appellant;  C. Crandall of San Marcos, CA, for the appellees. (Download the full text at www.ce9.uscourts.gov/) 

33)  EQUITABLE TOLLING:  Daviton v. Columbia / HCA Healthcare Corp., 98-16698 (9th Cir. Mar. 1, 2001).  Sitting en banc, the USCA held that it is error to require as a threshold matter for purposes of equitable tolling that a plaintiff seek the same remedies (not merely relief for the same wrong) in each forum before it applies California's equitable tolling rules;  the USCA held that Cervantes v. San Diego, 5 F.3d 1273 (9th. Cir. 1993), properly sets forth the California law on equitable tolling.  Schroeder, Kozinski, Trott, T.G. Nelson, Hawkins, Tashima, Thomas, Silverman, Gould, Paez (author), and Berzon, Circuit Judges.  J. Kresse of San Leandro, CA, for the appellants;  S. Parrish of San Francisco, CA, appellee.  (Download the full text at www.ce9.uscourts.gov/) 

34)  SANCTIONS:  Estrada v. Speno & Cohen, 99-56013 (9th Cir. Mar. 30, 2001).  A district court may order a default judgment on the basis of the party's repeated, persistently refusal to follow court orders;  under the circumstances of this case, the district judge did not need to explicitly consider alternative sanctions.  Archer, Trott (author), and Silverman, Circuit Judges.  D. Cohen of New York, NY, and J. Link of Pasadena, CA, for the defendants-appellants;  J. Paz of Los Angeles, CA, for the plaintiff-appellee. (Download the full text at www.ce9.uscourts.gov/) 

35)  FREEDOM OF SPEECH:  Planned Parenthood of the Columbia / Willamette, Inc. v. American Coalition of Life Activists, 99-35320 (9th Cir. Mar. 28, 2001).  Statements by anti-abortion activists about abortion providers, including the publishing of their names and addresses, which statements were made in public fora and which said nothing about planning to harm the abortion providers and did not call on others to do so were protected under the First Amendment.  Kozinski (author) and Kleinfeld, Circuit Judges, and Schwarzer, District Judge.  C. Ferrara of Ramsey, NJ, for the appellants;  M. Vullo of New York, NY, for the appellees.  (Download the full text at www.ce9.uscourts.gov/)

36)  FREEDOM OF SPEECH:  Gentala v. City of Tucson, 97-17062 (9th Cir. Mar. 30, 2001).  Sitting en banc, the USCA held that under the Establishment Clause of the First Amendment a city may not use tax funds and public employees to provide special-event services for a sectarian religious organization's prayer service held in the bandshell of a public park;  dissenting, Judge Fernandez did not view this case as being about speech or viewpoints of speakers;  he thought it was solely about discrimination against religious organizations and, as such, that it did violate the First Amendment but that it violated the clauses which command that government "shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof."    Dissenting, Judge Kleinfeld, joined by Judge Wardlaw, thought that before denying a permanent injunction, the district court should have obtained additional evidence and made findings of fact regarding several matters relevant to the outcome of this case  Schroeder, Fernandez (dissenting), T.G. Nelson, Kleinfeld (dissenting), Silverman, Graber, McKeown, Wardlaw (dissenting), W. Fletcher, Gould, and Berzon (author), Circuit Judges.  K. Theriot of Lawrenceville, Georgia, for the plaintiffs-appellants;  M. Turchik of Tucson, AZ, for the defendant-appellee. (Download the full text at www.ce9.uscourts.gov/) 

37)  SOCIAL SECURITY:  Osenbrock v. Apfel, 99-35376 (9th Cir. Mar. 2, 2001).  Substantial medical evidence supported an ALJ's finding that the plaintiff is capable of performing substantial gainful work that exists in the national economy;  dissenting, Judge Ferguson thought the majority had relied upon a determination by a vocational expert with an incomplete set of medical facts, and in so doing had misread the law and disregarded substantial record evidence.  Alarcon (author), Ferguson (dissenting), and McKeown, Circuit Judges.  D. Patrick of Lynnwood, WA, for the appellant;  R. McFarland of Seattle, WA, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

38)  MEDICARE  / FALSE CLAIMS ACT: USA v. Mackby, 99-15605 (9th Cir. Mar. 21, 2001).  A director of a physical therapy clinic knowingly caused false claims to be submitted to Medicare over a four year period when he instructed the clinic's billing company and office manager to use his physician father's Provider Identification Number on claim forms to bill for physical therapy services provided at the clinic.  Thompson (author), O'Scannlain, and Tashima, Circuit Judges.  P. Hooper of Los Angeles, CA, for the appellant;  AUSA G. Killefer of San Francisco, CA, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

39)  WELFARE REFORM ACT: Basiente v. Glickman, 99-17264 (9th Cir. Mar. 19, 2001).  Provisions of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 that make resident aliens in the Commonwealth of Northern Mariana Islands ineligible for federal public assistance were not waived as a matter of law although the Secretary notified Congress of his intent to waive them but later decided not to waive the provisions.  Hug (author), Trott, and Wardlaw, Circuit Judges.  J. Sorenson of Saipan, MP, for the appellants;  D. Lochabay of Saipan, MP, for the CNMI appellees;  M. Singer of Washington, DC, for the federal appellees. (Download the full text at www.ce9.uscourts.gov/) 

40)  SOCIAL SECURITY:  Tonapetyan v. Halter, 99-56486 (9th Cir. Mar. 19, 2001).  It was reversible error for an administrative law judge to fail to develop fully the record with respect to a SSI disability benefits claimant's mental impairment.  Pregerson, Canby (author), and Thompson, Circuit Judges.  J. Ohanian of Los Angeles, CA, for the plaintiff-appellant;  J. Baird of San Francisco, CA, for the defendant-appellee. (Download the full text at www.ce9.uscourts.gov/) 

41)  NATIVE AMERICAN LAW:  Bear Medicine v. INS, 99-35665 (9th Cir. Mar. 7, 2001).  The discretionary function exception to the Federal Tort Claims Act did not apply to the government's failure to provide safety training and undertake safety measures at a BIA-authorized logging operation on Indian land.  Alarcon, Ferguson (author), and McKeown, Circuit Judges.  M. Beck of Bozeman, MT, for the plaintiffs-appellants;  D. Odgen of Washington, DC, for the defendant-appellee. (Download the full text at www.ce9.uscourts.gov/) 

42)  IMMIGRATION LAW:  Espinoza-Castro v. INS, 99-70588 (9th Cir. Mar. 22, 2001).  The USCA denied an alien's petition to review a Board of Immigration Appeals' decision affirming an Immigration Judge's finding that the alien was deportable pursuant to 8 USC Sec. 1251(a)(1) because (1) he was excludable at entry under 8 USC Sec. 1182(a)(22) for having remained outside the United States to avoid or evade military service during a period of national emergency, and (2) he was not covered by a presidential pardon for violations of the Selective Service Act.  Beezer, T.G. Nelson (author), and Berzon, Circuit Judges.  G. Finn of Indio, CA, for the petitioner;  J. Bernstein of Washington, DC, for the respondent.  (Download the full text at www.ce9.uscourts.gov/) 

43)  IMMIGRATION LAW:  Park v. INS, 97-71373 (9th Cir. Mar. 6, 2001).  An involuntary manslaughter conviction under California Penal Code Sec. 192(b) constitutes an "aggravated felony" for which an alien is deportable under 8 USC Sec. 1251(a)(2)(A)(iii).  Goodwin, Graber, and Paez (author), Circuit Judges.  M. Karr of Sacramento, CA, for the petitioner;  J. Bernstein of Washington, DC, for the respondent.  (Download the full text at www.ce9.uscourts.gov/) 

44)  IMMIGRATION LAW:  Al-Harbi v. INS, 98-70828 (9th Cir. Mar. 9, 2001).  An alien who participated in an U.S. airlift of Iraqi dissidents out of Iraq established a well-founded fear of persecution based on imputed political opinion where substantial documentary evidence shows that Iraqi would persecute any evacuees who returned to Iraq;  substantial, non-testimonial, record evidence of the significant danger that the petitioner and others involved in the airlift would face if deported to Iraq, evidence from which no reasonable person could conclude otherwise; the petitioner thus established his entitlement to withholding of removal, and a fortiori, eligibility for asylum.  Kleinfeld, Tashima, and Berzon (author), Circuit Judges.  P. Atkins-Pattenson of San Francisco, CA, for the peti-tioner;  T. Scadron of Washington, DC, for the respondent. (Download the full text at www.ce9.uscourts.gov/) 

45)  IMMIGRATION LAW:  Hernaez v. INS, 99-70440 (9th Cir. Mar. 27, 2001).  An alien's admitted drug addiction cannot be considered a "criminal offense" such as to preclude jurisdiction under the transitional rules of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996;  however, the BIA did not err in denying the petitioner's motions to remand and reopen.  B. Fletcher, Fernandez, and Paez (author), Circuit Judges.  J. Stanton of Honolulu, HI, for the petitioner;  R. LeFevre of San Francisco, CA, for the respondent.  (Download the full text at www.ce9.uscourts.gov/) 

46)  IMMIGRATION LAW:  Aguirre-Cervantes v. INS, 99-70861 (9th Cir. Mar. 21, 2001).  The petitioner's immediate family, all of whom lived together and were subjected to abuse by the petitioner's father, constitutes a "protected particular social group" under 8 USC Sec. 1101(a)(42)(A) (1994 Supp. V); the petitioner was persecuted by her father on account of her membership in this group;  she had a well-founded fear of future persecution;  and, her homeland was unable or unwilling to interfere with that persecution;  the USCA thus found her eligible for asylum and entitled to withholding of removal as she established a clear probability of persecution if returned to Mexico.  Pregerson, Canby, and Thompson (author), Circuit Judges.  R. Glazer of Washington, DC, for the petitioner;  S. Goad of Washington, DC, for the respondent. (Download the full text at www.ce9.uscourts.gov/) 

47)  SEARCH & SEIZURE:  USA v. Dorais, 99-10091 (9th Cir. Mar. 1, 2001).  The policies and practices of a hotel may result in the extension past checkout time of a defendant's reasonable expectation of privacy in a hotel room;  under the circumstances of the instant case, the defendant's expectation of privacy was reasonable only until 12:30 p.m.  Sneed, Graber (author), and Paez, Circuit Judges.  K. Bucur of Laguna Hills, CA, for the defendants-appellants;  AUSA K. Sorenson of Honolulu, CA, for the plaintiff-appellee. (Download the full text at www.ce9.uscourts.gov/) 

48)  SEARCH & SEIZURE:  USA v. King, 00-30113 (9th Cir. Mar. 28, 2001).  A police officer did not have the reasonable suspicion to initiate a traffic stop which rested upon his mistaken belief that it is unlawful to drive a car with a disabled parking placard hanging from the rearview mirror.  Rymer, Thomas, and McKeown (author), Circuit Judges.  FPD M. Taggart of Anchorage, AK, for the defendant-appellant;  AUSA K. Feldis of Anchorage, AK, for the plaintiff-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

49)  EVIDENCE:  USA v. Mendoza, 00-10219 (9th Cir. Mar. 29, 2001).  A jury could find that a defendant who falsely reported that explosives were aboard a airplane was the proximate cause of the resulting endangerment to the flight as he could have reasonably foresee the result of his conduct.  Goodwin (author), Graber, and Paez, Circuit Judges.  AFPD S. Halbert of San Francisco, CA for the appellant;  AUSA L. Gray of San Francisco, CA, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

50)  EVIDENCE:  USA v. Corral-Gastelum, 99-10582 (9th Cir. Mar. 5, 2001).  Evidence that an illegal alien traveled with a group across the border, carried a gun, and fled from Border Patrol Agents in the direction of an area where duffel bags containing marijuana were found was insufficient as a matter of law to support convictions for conspiracy to possess with intent to distribute marijuana, 21 USC Sec. 846, possession with intent to distribute marijuana, 21 USC Sec. 841(a)(1), and use of a firearm during a drug trafficking crime, 18 USC Sec. 924(c).  Reinhardt (author), Leavy,. And Silverman, Circuit Judges.  G. Kuykendall of Tucson, AZ, for the appel-lant;  AUSA C. Cabanillas of Tucson, AZ, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

51)  DUE PROCESS:  USA v. Galindo-Gallegos, 99-50585 (9th Cir. Mar. 27, 2001).  The questioning of 15 to 20 suspected illegal aliens in a public setting before witnesses by Border patrol agents did not constitute a custodial interrogation for purposes of Miranda.  Rymer, Kleinfeld (author), and Paez, Circuit Judges.  D. Dilorio of San Diego, CA, for the appellant;  AUSA K. Kelly of San Diego, CA, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

52)  DUE PROCESS:  USA v. Davis, 00-10230 (9th Cir. Mar. 20, 2001).  Congress did not exceed its authority under the Commerce Clause when it deemed the procession of a firearm by a felon to be criminal;  Congress lawfully exercised its authority in enacting 18 USC Sec. 922(g)(1).  Reinhardt, Rymer, and Fisher, Circuit Judges.  Per Curiam.  FPD G. Hansen of San Francisco, CA,  for the ap-pellant;  AUSA I. Ramsey of Oakland, CA, for the USA.  (Download the full text at www.ce9.uscourts.gov/) 

53)  DUE PROCESS:  USA v. Ruiz, 00-50048 (9th Cir. Mar. 5, 2001).  A defendant's right to receive undisclosed Brady material cannot be waived through plea agreements;  the USCA directed the district court to conduct an evidentiary hearing to determine whether the government withheld a "fast track" recommendation because the defendant refused to waive her Brady rights;  concurring, Judge Tashima wrote separately to note that he thought the dissent mistakenly asserts that cases dealing with substantial assistance departures are irrelevant to the USCA's jurisdiction to hear this appeal, and that he disagreed with the dissent's prediction that the majority's decision jeopardizes the fast track program;  dissenting, Judge Tallman thought the majority had crafted a rule unnecessary to the disposition of this case and detrimental to the ability of an overburdened and understaffed district to dispose fairly and expeditiously of criminal cases under the "fast track" program.  Boochever  (author), Tashima (concurring), and Tallman (dissenting), Circuit Judges.  FPD T. Britt of San Diego, CA, for the appellant;  AUSA D. Curnow of San Diego, CA, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

54)  RIGHT TO COUNSEL:  USA v. Akins, 99-30241 (9th Cir. Mar. 27, 2001).  Under 18 USC Sec. 922(g)(9), for purposes of the offense of possession of a firearm by a person convicted of a misdemeanor domestic violence crime, a defendant pleading guilty must be informed of the disadvantages of self-representatives before waiving his right to counsel.  Pregerson and D.W. Nelson (author), Circuit Judges, and Karlton, District Judge.  FPD T. Monaghan of Yakima, WA, for the appellant;  AUSA J. Kirk of Yakima, WA, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

55)  CONSPIRACY:  USA v. Kleve, 97-56182 (9th Cir. Mar. 16, 2001).  On remand from the U.S. Supreme Court, the USCA adhered to its earlier decision, holding that jury verdicts acquitting the petitioner of conspiracy to commit first-degree murder and convicting him of conspiracy to commit second degree murder were not invalidated by a subsequent California Court, People v. Cortez, 18 Cal. 4th 1223 (1998), which held that there is no crime of conspiracy to commit second-degree murder in California;  the USCA noted that the holding and rationale of Cortez may mean that the petitioner's crime was mislabeled as conspiracy to commit second degree murder;  dissenting, Judge Nelson thought that the defendant was convicted for conduct that California does not prohibit and that his continued incarceration violated due process.  D.W. Nelson (dissenting), Fernandez, and W. Fletcher (author), Circuit Judges.  T. Kleve pro per;  D. Wilson of Los Angeles, CA, for the respondents-appellees. (Download the full text at www.ce9.uscourts.gov/) 

56)  RIGHT TO COUNSEL:  Lockhart v. Terhune, 99-16010 (9th Cir. Mar. 14, 2001).  At his trial for murder and attempted murder, prosecutors presented evidence that the petitioner had committed a second, earlier murder; the petitioners appointed counsel also represented a man implicated in that earlier homicide;  as the petitioner was not informed that his counsel also represents that man, the petitioner's waiver of his attorney's conflict of interest was not knowing and intelligent.  Goodwin, Graber, and Paez (author), Circuit Judges.  A. Kutchins of Berkeley, CA, for the petitioner;  A. Haddix of San Francisco, CA, for the respondents. (Download the full text at www.ce9.uscourts.gov/) 

57)  LACEY ACT:  USA v. Santillan, 99-50773 (9th Cir. Mar. 14, 2001).  A defendant who knowingly imports wildlife into the U.S. and knowingly possesses that wildlife in violation of the law, is guilty of a felony under the Lacey Act;  the Act does not require knowledge of the particular law violated by the possession, so long as the defendant knows of its unlawfulness.  Rymer, Kleinfeld (author), and Paez, Circuit Judges.  FPD M. Garcia of San Diego, CA, for the appellant;  AUSA A. Perry of San Diego, CA, for ap-pellee. (Download the full text at www.ce9.uscourts.gov/) 

58)  JURY INSTRUCTION:  USA v. Henderson, 00-10168 (9th Cir. Mar. 22, 2001).  It was harmless error to fail to instruct the jury that a conviction for digging a trench on Bureau of Land Management land requires the government to prove that the defendant was aware that his conduct was unlawful where the defendant had received a BLM notice informing him that he was subject to criminal liability for the digging.  Sneed, Graber (author), and Paez, Circuit Judges.  M. Branscomb of Phoenix, AZ, for the appellant;  AUSA L. Boone of Phoenix, AZ, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

59)  JURY INSTRUCTIONS:  USA v. Dipentino, 98-10449 (9th Cir. Mar. 13, 2001).  A district court committed plain error when it constructively amended the indictment by instructing the jury on a work practice standard that the defendants were not charged with violating when they removed asbestos from a building.  Thompson (author), O'Scannlain, and Tashima, Circuit Judges.  K. Stolworthy of Las Vegas, NV, and D. Riordan of San Francisco, CA, for the appellants;  J. Morgulec of Washington, DC, for the appellee. (Download the full text at www.ce9.uscourts.gov/) 

60)  SENTENCING:  USA v. Castillo-Rivera, 00-50046 (9th Cir. Mar. 26, 2001).  A state felon in possession of a firearm offense need not include a commerce nexus as an element to qualify as an aggravated felony for sentencing purposes;  here, the defendant's prior state conviction for being a felon in possession of a firearm under Cal. Penal Code Sec. 12021(a) constitutes an aggravated felony "as an offense described in" 18 USC Sec. 922(g)(1), pursuant to USSG Sec. 2L1.2(b)(1)(A) and 8 USC Sec. 1101(a)(43)(E)(ii).  Tashima (author) and Fisher, Circuit Judges, and Zilly, District Judge.  FPD M. Stratton of Los Angeles, CA, for the defendant-appellant;  AUSA W. Hsu of Los Angeles, CA, for the plaintiff-appellee.(Download the full text at www.ce9.uscourts.gov/) 

61)  SENTENCING:  Dillard v. Roe, 99-56345 (9th Cir. Mar. 27, 2001).  A defendant's constitutional rights were violated by the imposition of two sentence enhancements by the state trial judge as the jury did not find that his offense—
inflicting corporal injury upon a cohabitant—constituted a "serious felony" under Cal. Penal Code Sec. 667(a)(1).  Pregerson (author), Canby, and Thompson, Circuit Judges.  P. Gold of Berkeley, CA, for the petitioner;  DAJ J. Kahan of Los Angeles, CA, for the respondent. (Download the full text at www.ce9.uscourts.gov/) 

62)  SENTENCING:  USA v. Aquino, 99-10501 (9th Cir. Mar. 8, 2001).  It is improper to apply any guidelines weapons enhancement for an underlying offense even where, as here, the co-defendant, as part of jointly undertaken criminal activity, possessed a firearm different from the one for which the defendant was convicted under 18 USC Sec. 924(c).  Hug, Trott, and Wardlaw (author), Circuit Judges.  S. Courageous and E. Fisher of Honolulu, HI, for the defendants-appellants;  AUSA R. Johnson of Honolulu, HI, for the plaintiff-appellee. (Download the full text at www.ce9.uscourts.gov/) 

63)  SENTENCING:  USA v. Verdin, 00-50131 (9th Cir. Mar. 22, 2001).  A defendant's false statements about his identity to a probation officer were material to his offense of importing marijuana in violation of 21 USC Secs. 952 and 960;  the district court did not err in imposing a two-level enhancement for obstruction of justice under USSG Sec. 3C1.1 (Nov. 1998) for providing a false identity to the probation officer.  B. Fletcher, Thomas, and Wardlaw (author), Circuit Judges.  G. Burcham of San Diego, CA, for the defen-dant-appellants;  AUSA M. Edelman of San Diego, CA, for the plaintiff-appellee. (Download the full text at www.ce9.uscourts.gov/) 

64)  SENTENCING:  USA v. Herrera-Rojas, 99-50688 (9th Cir. Mar. 15, 2001).  It was not double counting to impose a sentence enhancement for an alien smuggler's conduct in exposing his alien charges to extreme weather conditions that creates a substantial risk of serious bodily injury and a separate enhancement for a death that occurs as a result of that conduct.  Boochever (author), Trott, and Berzon, Circuit Judges.  J. Deaton of San Diego, CA, for the appellant;  AUSA M. Skerlos of San Diego, CA, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

65)  SENTENCING:  USA v. Parker, 00-10118 (9th Cir. Mar. 1, 2001).  A defendant's participation in an armed bank robbery together with a minor did not warrant a sentence enhancement under USSG Sec. 2B1.4 (2000) for use of a minor to commit a crime in the absence of evidence that he acted affirmatively to involve the minor in the robbery, beyond merely acting as his partner.  Goodwin (author), Graber, and Paez, Circuit Judges.  S. Gillies of Woodland, CA, for the appellant;  AUSA C. Sonderby of Sacramento, CA, for the appellee.  (Download the full text at www.ce9.uscourts.gov/) 

66)  SENTENCING:  USA v. Lopez-Pastrana, 00-10146 (9th Cir. Mar. 28, 2001).  A defendant's shoplifting conviction should not have been counted in determining his criminal history category because shoplifting is "similar to" an insufficient funds check offense under USSG Sec. 4A1.2(c)(1) in that they share similar elements, similar penalties, and similar underlying conduct;  dissenting, Judge Graber did not find shoplifting "similar to" any of the excluded offenses listed in Sec. 4A1.2(c)(1);  she thought the majority's contrary conclusion illustrated the inconsistency in Circuit cases, failed to follow the most closely analogous Circuit precedent, and needlessly created a conflict with at least one sister Circuit.  Sneed (author), Graber (dissenting), and Paez, Circuit Judges.  AFPD M. Powell of Reno, NV, for the defendant-appellant;  AUSA C. Denney of Reno, NV, for the plaintiff-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

67)  HABEAS CORPUS:  Petrocelli v. Angelone, 97-99029 (9th Cir. Mar. 8, 2001).  The petitioner's prior kidnapping conviction in the State of Washington, which resulted in a deferred sentence with five years probation and a one-year jail term, suspended so long as he entered a drug treatment program, did not preclude the Nevada trial court from finding that the prior conviction constituted an ag-gravating factor in the defendant's Nevada trial for first-degree murder;  concurring, Judge Rymer wrote separately to note that her concurrence on the merits of issues arising under McKenna v. McDaniel, 65 F.3d 1483 (9th Cir. 1995), was not without reservations.  Pregerson, Rymer (concurring), Tashima (author), Circuit Judges.  P. Yohey of Reno, NV, for the petitioner-appellant;  J. Slabaugh of Carson City, NV, for the respondent-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

68)  HABEAS CORPUS:  Bragg v. Galaza, 99-16636 (9th Cir. Mar. 12, 2001).  Where a habeas petitioner cannot establish ineffective assistance of counsel on a factually inadequate record because he failed to develop the factual basis for his claim in state court, the USCA is precluded from remanding for an evidentiary hearing by the Anti-Terrorism and Effective Death Penalty Act.  O'Scannlain, Leavy, and Gould (author), Circuit Judges.  FPD Q. Denvir of Sacramento, CA, for the petitioner;  B. Lockyer of Sacramento, CA, for the respondent.  (Download the full text at www.ce9.uscourts.gov/) 

69)  HABEAS CORPUS:  La Crosse v. Kernan, 97-55085 (9th Cir. Mar. 26, 2001).  Although the California Supreme Court denial of a habeas petition cited only "lack of diligence" as its reason, the USCA concluded that the district court correctly concluded that the California Supreme Court had applied the untimeliness bar because the petitioners delayed for nearly 12 years between his direct appeal and his state petition for habeas corpus.  O'Scannlain, Fernandez, and T.G. Nelson (author), Circuit Judges.  M. La Crosse pro se;  DAG C. Mar of Los Angeles, CA, for the respondents-appellees.  (Download the full text at www.ce9.uscourts.gov/) 

70)  HABEAS CORPUS:  Paradis v. Arave, 00-35464 (9th Cir. Mar. 5, 2001).  The record supported the conclusion that a reasonable probability existed that the result of the defendant's trial would have been different had prosecution disclosed to the defense certain handwritten notes that could have been valuable impeachment evidence.  Canby and Tashima (author), Circuit Judges, and Silver, District Judge.  L. Anderson of Boise, ID, for the respondent-appellant;  E. Matthews of New York, NY, for the petitioner-appellee. (Download the full text at www.ce9.uscourts.gov/) 

71)  HABEAS CORPUS:  Bunney v. Mitchell, 00-15432 (9th Cir. Mar. 5, 2001).  For prisoners like the petitioner, whose convictions became final before the Antiterrorism and Effective Death Penalty Act was enacted, the Act's one-year statute of limitations began to run on the Act's effective date, April 24, 1996, and expired on April 23, 1997, unless tolled;  the petitioner was aware of the "factual predicate" of her claim more than one year before she filed her petition;  the district court did not err in refusing to toll the statute of limitations for the period during which the petitioner could have sought certiorari; and, the district court did not err in refusing to toll the statute of limitations on equitable grounds.  Goodwin, Graber (author), and Paez, Circuit Judges.  M. Bolinas, CA, for the petitioner;  M. Kaye of San Francisco, CA, for the respondent. (Download the full text at www.ce9.uscourts.gov/) 

72)  HABEAS CORPUS:  Dictado v. Ducharme, 98-35531 (9th Cir. Mar. 38, 2001).  Where a state prisoner's habeas petition was filed within the one-year statute of limitations period of the Antiterrorism and Effective Death Penalty Act, the running of the limitations period was tolled by the petitioner's diligent pursuit of his "properly filed" 1997 personal restraint petition. Browning, Beezer (author), and Kleinfeld, Circuit Judges.  AFPD R. Owen of Seattle, WA, for the petitioner;  AUSA J. Samson of Olympia, WA, for the respondent.  (Download the full text at www.ce9.uscourts.gov/) 

73)  CAPITAL CASES:  Smith v. Stewart, 96-99025 (9th Cir. Mar. 6, 2001).  The defendant made a colorable claim to relief entitling him to an evidentiary hearing where he alleged that his attorney failed to investigate and present evidence of his miserable childhood and mental impairment at the time of his offense.  Ferguson (author), Reinhardt, and Thompson, Circuit Judges.  S. Young of Tucson, AZ, for the petitioner;  S. Bales of Phoenix, AZ, for the respondent. (Download the full text at www.ce9.uscourts.gov/) 

74)  CAPITAL CASES:  Lambright v. Stewart, 96-99020 (9th Cir. Mar. 6, 2001).  The USCA remanded for an evidentiary hearing to enable the district court to determine whether the petitioner had been denied effective assistance at sentencing due to his counsel's alleged failure to investigate and present evidence of his psychiatric condition and social history.  Ferguson (author), Reinhardt, and Thompson, Circuit Judges.  D. Tiers of Tucson, AZ, for the petitioner-appellant;  S. Bales of Phoenix, AZ, for the respondent-appellee.  (Download the full text at www.ce9.uscourts.gov/) 

 1)  CONTRACTS / JURISDICTION:  Sierra Pacific Airlines v. Dallas Aerospace, 99-15936 (9th Cir. Mar. 12, 2001) (unpublished).  Reinhardt, Leavy, and Silverman, Circuit Judges.
        The District Court for Arizona, Judge Zapata presiding, dismissed for lack of specific personal jurisdiction Sierra Pacific Air-lines' action against Dallas Aerospace and General Electric Engine Service—Dallas, L.P. ("GE Services")  The USCA reversed and remanded.
        Sierra is a corporation in Tucson which owns a Boeing 737 plane it leases to others.  Its engines required periodic maintenance.  GE Services, a Texas limited partnership, is an engine repair company.  Dallas Aerospace, a Texas corporation, provides management services for airplane engine repairs.  In past years, GE Services has traveled to Arizona to perform service calls on Sierra's engines.  In 1996, Sierra contacted GE Services about performing the "Schedule C" service on the engines.  In 1996 and 1997, GE Services actively pursued this job.  A vice-president of GE Services traveled to Tucson to present a proposed agreement to do the job directly with Sierra.  Sierra rejected the proposal.  In January 1997, Sierra and Dallas Aerospace entered into a written contract whereby Dallas Aerospace would manage the engine service job and GE Services would perform the actual work.  Under the contract, the engine was to be repaired and returned by March 30, 1997, but GE Service did not return the engine until May 12, 1997.  In a complaint against both defendants filed in May 1998 in the District Court for the District of Arizona, Sierra alleged it suffered extraordinary delay, loss of income, added expense, and damage to the engine.  The complaint contained allegations under the Texas Deceptive Trade Practices Act, the Arizona Consumer Fraud Statute, allegations of intentional and negligent misrepresentations, negligence, and breach of implied warranties.  GE Services moved to dismiss, or alternatively, moved to transfer venue.  A magistrate recom-mended that the action be dismissed due to the lack of personal jurisdiction.  The district court, upon de novo review, agreed and granted GE Services' motion to dismiss.  Dallas Aerospace also moved to dismiss, and the district court, upon conducting its own review, granted the motion for lack of personal jurisdiction.
         The USCA first noted that the burden fell upon Sierra to show that jurisdiction is appropriate, and in the absence of an evidentiary hearing, it need only make a prima facie showing of jurisdictional facts.  The district court considered only the pleadings and accompanying affidavits.  The issue was thus whether, treating Sierra's allegations and affidavits as true, it made a prima facie showing of jurisdictional facts.  The purposeful availment prong of the personal jurisdiction analysis can be met if a defendant's intentional conduct in the foreign state was calculated to cause injury to the plaintiff in the forum state.  The USCA concluded that Sierra made a prima facie showing that the conduct of both defendants was expressly aimed at the forum state of Arizona, and individually targeted Sierra, an Arizona corporation doing business primarily in Arizona.  Second, Sierra alleged that Dallas Aerospace made numerous representations to Sierra that the engine test dates had to be delayed and that the engine was "ready for service" when it was not ready for service.  Sierra alleged that GE Services ran tests on the engine which resulted in foreign object damage and damage from an oil leak.  It also alleged that Dallas Aerospace may have provided, and GE Services may have installed, unproved parts into the engine.  Sierra has alleged that both defendants made intentionally misleading representations regarding the repair work.  The USCA concluded that these are allegations of intentional conduct by both defendants that are expressly aimed at Sierra and whose effects would be felt by Sierra in Arizona.  Third, the USCA noted that in determining whether Sierra's claims arose out of defendant's forum related conduct, the Circuit follows the "but for" test.  Sierra must show that it would not have suffered injury or damages but for the defendants' forum related conduct.  Sierra's allegations arose out of the defendants' actions pursuant to the contract with Dallas Aerospace regard-ing the engine repair.  GE Services argued that it was not in a direct contractual relationship with Sierra because it performed services as a separate contractor with Dallas Aerospace.  However, the allegations were that GE Services made numerous representations directly to Sierra regarding the repair and that its performance role in the service contract was critical.  The USCA held that in this circumstance Sierra's claims arose out of both defendants' forum related conduct.  Fourth, the USCA noted that the final requirement for specific jurisdiction is reasonableness and that for jurisdiction to be reasonable, it must comport with fair play and substantial justice.  The defendants have the burden of showing a "compelling case" of unreasonable.  The reasonableness determination requires consideration of several specific factors:  (1) the extent of the defendants' purposeful interjection into the forum state, (2) the burden on the defendant in defending in the forum, (3) the extent of the conflict with the sovereignty of the defendants' state, (4) the forum state's interest in adjudicating the dispute, (5) the most efficient judicial resolution of the controversy, (6) the importance of the forum to the plaintiff's interest in convenient and effective relief, and (7) the existence of an alternative forum.  No one factor is dispositive; a court must balance all seven.  The "purposeful interjection" factor weighed in favor of the defendants.  They appear to have no offices, employees, or property in Arizona, do not advertise in any publications specifically directed at Arizona, and do not have any phone, mailing address, agent for process, or bank accounts in Arizona.  The solicitation of business activities was balanced between both Sierra and the defendants.  The "burden in defending" factor weighed in favor of Sierra.  Although the burden on the Texas defendants to litigate in Arizona was significant, the inconvenience was not so great as to deprive them of due process.  The extent of "conflict between the sovereignties" of Arizona and Texas was neutral as the complaint contained allegations under both the Texas Deceptive Trade Practice Act and the Arizona Consumer Fraud Statute.  Arizona, however, has a strong interest in providing an effective means of redress for its residents under its consumer fraud statutes.  The "forum interest" factor thus weighed in favor of Sierra.  The "efficient resolution" factor focused on the location of the evidence and witnesses.  Because both sides had evidence and witnesses in both states, this factor was neutral.  The "convenience and effective relief" for the plaintiff focused on the inconvenience to Sierra of litigating in another forum and was essentially neutral.  Whether there is an "alternative forum" is an issue only when the forum state has been shown to be unreasonable.  The pleadings and accompanying affidavits do not demonstrate that litigation in Arizona would be an unreasonable as opposed to the alternative forum of Texas.  The USCA thus held that, upon balance of all the factors, although the purposeful interjection factor weighed in favor of the defendants, the remaining factors were either neutral or weighed in favor of Sierra.  The record thus did not demonstrate a compelling case that the exercise of specific personal jurisdiction in Arizona would be unreasonable.

2)  TAXATION / SALE-LEASEBACK TRANSACTIONS:  Robertson v. CIR, 99-71368 (9th Cir. Feb. 5, 2001) (unpublished). Schroeder, Hall, and W. Fletcher, Circuit Judges.
       The Robertson appealed a tax court's finding that a computer sale-leaseback transaction in which he invested was a sham transaction, as well as its finding that he was liable for penalties for negligence.  The USCA agreed with the tax court on both issues.
        Tax benefits from sale-leaseback transactions, even when entered into with an eye to tax benefits, can be acceptable.  However, when a transaction is entered into without any purpose other than to obtain tax benefits, the form of the transaction will be disregarded and the tax benefits denied.  The Circuit uses a flexible two-prong test to determine whether a transaction is a sham:  (1) whether the transaction is likely to have economic substance aside from the tax benefits, and (2) whether there is a business purpose for entering into the transaction, aside from tax avoidance.  If the transaction fails this test, it is considered a sham.  The taxpayer bears the burden of proving that the transaction is not a sham.  Under the economic substance prong, the court determines whether, objectively, the transaction presents a reasonable opportunity for profit in addition to the potential tax avoidance.  The tax court's conclusion that Robertson purchased only a limited interest in the computers in question is an analytically permissible basis for describing the nature and assessing the value of what he had purchased.  There might have been economic substance to the transaction had Robertson pur\chased an interest with a higher value.  But he purchased only a percentage of any lease after the expiration of the Initial User Lease, and the fee simple in the computers remaining at the end of the Master Lease.  The value of Robertson's purchase depended entirely on the value of these interests.  The district court did not err in finding that the amount of money Robertson could have expected in return for this purchase was so small that the sale-leaseback transaction was a sham.  Under the business purpose prong, a court looks at the taxpayer's subjective belief as to whether the transaction had a business purpose other than tax avoidance.  Despite the expertise of Robertson and his partners, the tax court did not err in deeming insufficient the information on which they relied, and thus in finding that there was no business purpose.  Finally, the tax court upheld imposition of negligence-based penalties on Robertson under 26 USC Secs. 6653(a)(1), 6653(a)(2), and 6661.  Robertson had not established that the tax court erred in finding the testimony he presented on this issue not credible.  Their argument that penalties were inappropriate because the tax court relied on a "novel legal theory" in com-ing to its conclusion was also without merit.  The court did not use a novel legal theory, but compared the amount of the cash down payment to the amount Robertson could expect to make from his investment.  The tax court rejected expert testimony presented by Robertson in the negligence penalties hearing.  Robertson argued that such a holding was an abuse of discretion.  The trial court is ob-ligated to perform a "gatekeeping" function to ensure that expert testimony is "not only relevant, but reliable."  The tax court found that Robertson's expert testimony was not objective;  it thus did not abuse its discretion in deeming the testimony unreliable.  Moreover, the tax court did not err in concluding that expert testimony was, in any event, not relevant to its conclusion regarding the negligence pen-alties.

3)  TAXATION:  Sherrer v. CIR, 99-71381 (9th Cir. Mar. 7, 2001) (unpublished).  T.G. Nelson, Graber, and Rawlinson, Circuit Judges.
       The tax court upheld the CIR's determination that Sherrer was liable for penalties under 26 USC Sec. 6651(f) for fraudulent failure to file income tax returns for tax years 1989 through 1992.  Sherrer appealed, challenging the tax court's finding of fraudulent intent.  The USCA affirmed.
       The tax court found fraudulent intent based on the following "badges of fraud":  (1) failure to file tax returns; (2) maintenance of inadequate business records; (3) use of a false Social Security number to conceal income; (4) extensive use of cash to conceal assets and business dealings; and (5) failure to pay estimated taxes.  It also state that Sherrer's persistent failure to file returns, in view of his substantial income and previous conviction for tax evasion, was by itself sufficient evidence to support a finding of fraudulent intent, which the other "badges" only reinforced.  Sherrer did not challenge these findings, all of which are established by stipulated facts.  Nor did he address the tax court's finding that, in the circumstances, (1) was sufficient to support a finding of fraudulent intent.  He argued only that the tax court should not have considered evidence of his deposits and attempted deposits in a Bahamian bank account, which the tax court admitted under Federal Rules of Evidence 404(b) as evidence of "other acts," to show his intent to conceal income or assets from the IRS.  He also argued that the tax court should not have drawn a negative inference from his invocation of the Fifth Amendment privilege against self-incrimination in this civil proceeding.  The USCA found that it did not need to address Sherrer's arguments on the merits as the tax court's errors, if any, were harmless.  The five "badges of fraud" that Sherrer did not challenge on appeal were, by themselves, sufficient to support the tax court's finding of fraudulent intent.  The tax court also made it clear that the first "badge" alone would have caused the court to make a finding of fraudulent intent, so the result would not have been different if the tax court had accepted Sherrer's arguments.  The USCA thus concluded that even were it to accept Sherrer's arguments, the tax court's finding of fraudulent intent was not clearly erroneous.

4)  TAXATION: Schachter v. CIR, 99-71436 (9th Cir. Mar. 22, 2001) (unpublished).  Hug, Noonan, and W. Fletcher, Circuit Judges.
        Schachter maintained that the tax court erred in disregarding additional expenses that the IRS should have considered in measuring his company's taxable income, and in determining that he was should not be allowed a credit or offset for a civil penalty imposed because of a previously paid criminal fine.  The USCA affirmed.
        Schachter argued that the tax court erroneously equated gross receipts with taxable income when it disallowed additional business expenses in determining taxable income.  However, the USCA noted that the tax court allowed reported deductions on the income returns for 1985-1988, and allowed additional expenses for consulting fees and truck depreciation.  Moreover, the IRS has established that Schachter had unreported income.  There was thus a presumption that the deductions and exclusions listed by the taxpayer in his return were all that existed.  Schachter could not produce direct evidence showing additional expenses because of his inadequate books and records.  However, he had duty to maintain sufficient records in order to establish deductions.  Because direct evidence was lacking, Schachter provided testimony regarding additional expenses.  The question of whether a taxpayer is allowed ex-penses is a question of fact established by the taxpayer's evidence, the credibility of the taxpayer, and the credibility of supporting wit-nesses.  Here, the tax court found that the proffered testimony was not credible.  Based on a review of the record, the USCA agreed for the same reasons given by the tax court.  Schachter also argue that he was entitled to a credit or offset for the civil penalty because the civil fine and the earlier criminal fine are both remedial in nature.  The USCA disagreed.  The criminal penalty assessed to Schachter under 18 USC Secs. 3622 and 3623 for tax evasion and conspiracy to defraud the United States was directed towards punishment.  The legislative history of Secs. 3622 and 3623 is clear and explains that the purpose for the criminal penalty is punishment.  The factors to be considered in determining a penalty under Sec. 3622, including the consideration of the person's income, earning capacity, and fi-nancial resources, are to help ensure that "realistic fines are more likely to be collected," and that "greater equity in punishment will be fostered."  H.R. Rep. No. 98-906, at 1 (1984).  Moreover, allowing Schachter a credit for the criminal fine already paid is inconsistent with the idea that tax fraud is subject to both criminal and civil sanctions.

5)  BANKRUPTCY: In re Goldstein, 99-16233 (9th Cir. Mar. 14, 2001) (unpublished).  B. Fletcher, Fernandez, and Paez, Circuit Judges.
      The bankruptcy court denied Bankers Trust Company's motion to retroactively annul the automatic stay imposed by 11 USC Sec. 362(a).  Finding that the bankruptcy court had abused its discretion, the District Court for Arizona, Judge Silver presiding, reversed.  The USCA affirmed.
       Under Sec. 362(a)(1), (3), the filing of a bankruptcy petition automatically stays the commencement or continuation of a judicial, administrative, or other action or proceeding against the debtor and any act to obtain possession of the property of the estate.  The parties here did not contest the holding of the bankruptcy court and the district court that the proceedings in the New York Surrogate Court where subject to an automatic stay as a result of debtor Goldstein's bankruptcy.  All judicial actions taken during the pendency of the stay were thus void.  However, on the request of a party-in-interest, the court "shall" grant relief from the stay, such as by terminating, annulling, modifying, or conditioning the stay for cause, Sects 362(d), (d)(1), and such relief may be retroactive.  Reviewing the matter de novo and applying the same standard of review the district court applied to the bankruptcy court's decision, the USCA first noted that the bankruptcy court made no factual findings in its order denying the appellee's motion but that it may review the case even in the absence of express findings, if a complete understanding of the issues may be had from the record without the aid of separate findings.  The bankruptcy court is obligated to grant relief from the automatic stay upon a showing of cause.  Although Congress did not define "cause" and courts must make determinations on a case-by-case basis, any equitable exception to the automatic stay should be narrow and applied only in extreme circumstances.  The USCA said it looks primarily to two factors in considering a request to retroactively annul an automatic stay: (1) whether the other party was aware of the bankruptcy petition; and (2) whether the debtor engaged in unreasonable or inequitable conduct, or prejudice would result to the other party.  These two factors weighed so strongly in favor of retroactively annulling the stay that the bankruptcy court's judgment was clearly against the "logic and effect" of the facts as found.  The appellants (the debtor and his sisters) did not contest that Bankers Trust did not know about the debtor's bankruptcy for several years after the debtor filed her Chapter 11 petition.  Although Bankers Trust's lack of knowledge was not sufficient reason to retroactively lift the stay, the USCA noted that courts will apply equitable considerations where the other party was without actual knowledge of a bankruptcy petition and the bankruptcy's unreasonable behavior contributed to the other party's plight.  The USCA noted that courts are especially concerned with allegations of bad faith.  Here the timing of the appellants' reliance on the automatic stay is telling.  The USCA found this case to be similar to In re Calder, 907 F.2d 953 (10th Cir. 1990), where the debtor "actively litigated the state court action and did not provide notice of the pending [bankruptcy] proceeding until just before the state court was to enter a final judgment."  Here, the appellants could have raised the debtor's bankruptcy and, thus, the applicability of the stay at any time when the two summary judgment motions and related matters were pending before the state surrogate court or at the time of the first notice of appeal.  As in Calder, the appellants here bear some responsibility for the unreasonable delay in asserting their rights under Sec. 362(a).  The automatic stay may not "be used as a trump card played after an unfavorable result is reached in state court."  Id. at 956-57.  However, the USCA noted that the two factors—Bankers Trust's knowledge and the appellants' conduct—were not dispositive.  In granting retroactive relief from an automatic stay, the USCA noted that it must also consider whether "the state court claim was sufficiently large such that it would have to be resolved before [the debtor] could complete a reorganization;  [and whether] not annulling the stay would either lead to nonsensical results by submitting the same case to the same jury that had just rendered a decision, or impose an unwarranted hardship on the creditors, since retrial would be costly."  The USCA found that these additional factors also weighed in favor of granting retroactive relief.  First, although there was very little money left in the estate in question, the USCA found it difficult to see how the debtor's reorganization could be completed without knowing how much, if anything, she would finally inherit.  The bankruptcy proceedings would operate more efficiently if the probate case is completed.  Second, contrary to the appellant's contention, the case has been extensively litigated in state court.  The appellants have had more than ample time to complete discovery.  And in addition to the two fully briefed summary judgment motions, the appellants had the opportunity to take two appeals.  The automatic stay should not be used to allow the debtor's sisters to make up for their own negligence in failing to perfect those appeals.  The USCA found no reason to force Bankers Trust and the New York Surrogate Court to bear the expense of relitigating the probate case to what will likely be the same result.  Lastly, the USCA said it was mindful that the appellants are not relying on the stay to "give the debtor a breathing space from his or her creditors." H.R. Rep. No. 595, 9th Cong., 1st Sess. 340 (1978).  Rather, the debtor's sisters were using the stay to attempt to relitigate the state court proceedings.  Because the balance of the equities overwhelmingly favor retroactively lifting the stay, the USCA agreed with the district court that the bankruptcy court abused its discretion.

6)  BANKRUPTCY FRAUD: In re Taghilou, 00-50400 (9th Cir. Mar. 2, 2001) (unpublished).  Pregerson, Canby, and Thompson, Circuit Judges.
       Taghilou appealed his conviction and sentence for bankruptcy fraud in violation of 18 USC Sec. 152(1) and knowingly making a material false statement under penalty of perjury in violation of 28 USC Sec. 1746. The USCA affirmed.  Taghilou filed a bankruptcy petition in which he failed to disclose his ownership of an aircraft.  He maintained that the District Court for the Central District of California, Judge Wilson presiding, erred in permitting the government to call his bankruptcy attorney as a witness during its case-in-chief.  The USCA disagreed.  During a pretrial hearing, Taghilou represented that as an affirmative defense he intended to blame his bankruptcy attorney for failing to disclose the plane.  The USCA concluded that the district court did not err by determining that this defense would constitute a waiver of the attorney-client privilege.  Thereafter, during voir dire, Tagihou's trial counsel reiterated his intention to present such a defense.  When the government presented Taghilou's bankruptcy attorney as a witness in its case-in-chief, Taghilou's trial counsel made no objection.  The district court had no obligation, sua sponte, to preclude the bankruptcy attorney from testifying without another waiver of the attorney-client privilege.  There was, the USCA concluded, no error, much less plain error.  The district court also clearly did not err by imposing a four-level increase pursuant to Sentencing Guideline Sec. 2F1.1(b)(1)(E).  Taghilou had an equity in the plane in excess of $20,000, based on the airplane's estimated retail value of $60,250 and an outstanding mortgage loan balance of some $38,000.

7)  BANKRUPTCY: In re Transcisco Industries, Inc., 99-15679 (9th Cir. Mar. 23, 2001) (unpublished).  Reinhardt, Rymer, and Fisher, Circuit Judges.
       Noback appealed the bankruptcy court's award of attorneys' fees and the denial of his motion for sanctions and motion to file an enlarged motion for sanctions before the district court.  The USCA affirmed for the reasons stated by the district court.  Noback maintained that the bankruptcy court erred when it deviated from the lodestar approach in calculating his attorneys' fees.  The USCA noted that although the lodestar approach is customary for attorney fee calculations, the Circuit has held that it is not required in the bankruptcy context where it would "not realistically quantify to numerical precision" the fee award.  In re Great Sweats, 113 B.R. 240, 244 (E.D. Va. 1990).  Because the record supports the bankruptcy court's determination that Noback's work was so "incompetent" and "grossly inefficient" as to render the lodestar approach useless, the bankruptcy court did not abuse its discretion when it deviated from the lodestar approach.  In addition, the USCA's review of the record revealed that the bankruptcy court's fee award to Noback was generous, and regardless of the particular procedure used to determine the fee in this case, the amount would not exceed the $70,000 award.  Noback moves for sanctions against Transcisco for numerous so-called "false" assertions made in Transcisco's opening brief before the district court.  The USCA reviewed the district court denial of sanctions under Fed. R. App. P. 38 for an abuse of discretion.  After reviewing Noback's motion for sanctions before the district court, the USCA concluded that none of his claims had merit. 

8)  BANKRUPTCY: In re Brookover, 00-15881 (9th Cir. Mar. 26, 2001) (unpublished).  Wallace, Silverman, and W. Fletcher, Circuit Judges.
        The District Court for Arizona, Judge Silver presiding, affirmed the bankruptcy court's decision to reopen Brookover's bankruptcy proceedings and except from discharge a superior court judgment against Brookover. Brookover appealed.  The USCA vacated and remanded.  A notice of appeal must be filed with the district court within 10 days of the bankruptcy court's entry of judgment.  Fed. R. Bankr. P. 8002(a).  The provisions of Bankruptcy Rule 8002 are jurisdictional and strictly construed.  Greene v. USA, 795 F.2d 855 (9th Cir. 1986).  The untimely notice of appeal was not brought to the attention of the district judge, nor cited to the USCA.  However, because Brookover filed his notice of appeal to the district court more than 10 days after the bankruptcy court entered judgment, the district court lacked jurisdiction over the appeal.  The USCA vacated the district court's order and remanded for dismissal.

9)  INSURANCE: Sergio Construction v. Northbrook Property & Casualty Insurance Company, 99-16411 (9th Cir. Mar. 14, 2001) (unpublished).  B. Fletcher, Fernandez, and Paez, Circuit Judges.
        The District Court for the Northern District of California, Judge Illston presiding, denied Sergio Construction's Rule 56(f) motion and granted summary judgment in favor of Northbrook Property and Casualty Company and others (collective "Insurers") in Sergio's diversity action alleging breach of contract and other claims arising from a contract between Sergio and the West Valley Mission Community College District ("Mission") to build a gym on the District's campus.  Sergio appealed.  The USCA affirmed.
       Sergio, in effect, maintained that because its suit against Mission and Mission's counterclaim were mirror images of one another, the Insurers were obligated to expend more effort than they did.  However, the USCA found it clear that when an insurance contract obligated the insured to defend any suit seeking specified damages covered under the policy, the contract does not obligate the insurers to prosecute the insured's]claims against the other party, because neither the prosecution of the plaintiff's primary facie case nor the defeat of [the other party's] defenses thereto could be considered the defense of a suit seeking damages.  3250 Wilshire Boulevard Bldg. V. Employers Ins. Of Wausau, 39 Cal. App. 4th 1277, 1280.  Thus, when the Insurers defended against Mission's cross-claim until it was dismissed, they satisfied their duty under the insurance agreements.  The dismissal obtained by counsel hired by the Insurers did not forestall Sergio from bringing or otherwise hamper its suit against Mission.  Sergio also maintained that it was entitled to Cumis counsel pursuant to California Civil Code Sec. 2860.  San Diego Navy Fed. Credit Union v. Cumis Ins. Soc'y, 162 Cal. App. 3d 358, 369.  However, the USCA noted that the Cumis issue was not properly raised in Sergio's complaint or in its memoranda regarding summary judgment, and was not discussed in the district court's decision.  The USCA thus declined to consider it.

10)  INSURANCE: Segal v. Massachusetts Mutual Life Insurance Company, 99-17182 (9th Cir. Mar. 23, 2001) (unpubished).  Hawkins, McKeown, and Wardlaw, Circuit Judges.
       Concluding that no material issues of fact remained for trial, the District Court for the Eastern District of California, Judge Burrell presiding, granted summary judgment to Massachusetts Mutual Life Insurance Company ("Mass Mutual").  The USCA affirmed.  It found that the district court correctly interpreted the unambiguous terms of the policy.  The recurrent disability provisions takes into account the earlier disability period with respect to the calculation of certain time periods, but did not forever establish the applicable benefit payment amount or the applicable benefit period for that recurrent injury.  Pursuant to the terms of the policy, the amount of benefits and the benefits period could be changed at the insured's election, as they were in this case, and this intervening change was effective at the time Segal's disability recurred.  As Mass Mutual effectively reissued the disability policy in its entirety, Cal. Ins. Code Sec. 10331, which applies to changes "after issuance" is inapplicable.  The district court also properly concluded that the modified policy was not an unenforceable exclusion of existing benefits without notice, but simply a change of benefits at the insured's specific request.  Segal waived his argument that the district court abused its discretion by considering the declarations of two Mass Mutual employees because Segal did not explain in his brief to the USCA how the district court erred or cite any authority to support his argument.  Finally, the district court did not abuse its discretion in denying Segal's motion to amend the judgment and permit amendment of his complaint.  A Rule 15(a) motion to amend a complaint after judgment may be considered "only if the judgment is first reopened under Rule 59 or 60."  Lindauer v. Rogers, 91 F.3d 1355, 1356 (9th Cir. 1996).  Segal failed to demonstrate a legitimate reason to reopen the judgment, and the court therefore properly denied his motion.

11)  INSURANCE / CONTRACTS / INTELLECTUAL PROPERTY: Nestle USA, Inc. v. Travelers Casualty & Surety Company of America, 99-56073 (9th Cir. Mar. 22, 2001) (unpublished).  Kozinski and Tallman, Circuit Judges, and Zapata, District Judge.
        Travelers maintained that the USCA lacked jurisdiction over Nestle's appeal because Nestle dismissed its claims against the only remaining defendant, Northbrook, after the district court entered summary judgment in favor of Travelers.  Travelers argued that no appellate jurisdiction exists under 28 USC Sec. 1291 where a losing party manufactures finality by dismissing remaining claims without prejudice.  Nestle dismissed its claims against Northbrook without prejudice (and pursuant to court order) after the district court ruled in Travelers' favor, but before the district court issued its final judgment.  The USCA noted that in evaluating whether the exercise of jurisdiction is proper, it takes a "pragmatic approach to finality in order to ensure the protection of the appellate process from manipulation by the parties.  The USCA found jurisdiction over this appeal.  The district court's final judgment was entered after Nestle dismissed its claims against Northbrook, and its specifically referenced the dismissal.  The district court then held that "as to the Consolidated Action, plaintiff Travelers prevails against the only remaining defendant, Nestle."  The USCA thus held that there could be no question that the district court entered judgment as to the only remaining parties in the action and that the judgment was final.  Nestle also maintained that its Lanham Act injuries did not arise solely from Stoner's breach of contract, but were caused also by Stoner's trademark law violations which were independent of the contract.  Nestle relied on Zurich Ins. Co. v. Killer Music, Inc., 998 F.2d 674 (9th Cir. 1993).  In Killer Music, the insured used copyrighted material without a license and in violation of the terms of an expired contract.  Despite the existence of a policy exclusion for claims arising from breach of contract, the USCA held that there was a potential for insurance coverage because a copyright infringement action could be brought independent of any contract, and in fact, no contract then existed—a fact that distinguishes Killer Music from the instant case.  Travelers had the burden of bringing itself within a policy exclusionary clause.  It had to show there was no potential for a covered claim.  California courts interpret the term "arising out of" broadly in various kinds of insurance provisions even when the term is used in an exclusionary provision and a broad interpretation results in limited coverage.  An exclusion from suit arising out of trademark infringement does not import any particular standard of causation or theory of liability into an insurance policy.  Rather, it links a factual situation with the event creating liability, and connotes only a minimal causal connections or incidental relationship.  Because Nestle's claims all arose out of the factual situation that constituted a breach of contract, they are excluded from coverage.

12)  PREJUDGMENT INTEREST / COSTS: Mioli v. Wal-Mart Stores, Inc., 99-17131 (9th Cir. Mar. 22, 2001) (unpublished).  Kozinski and Tallman, Circuit Judges, and Zapata, District Judge.
       The District Court for Nevada, Judge Leavitt presiding, denied Mioli's motion for prejudgment interest and awarded Wal-Mart Stores costs pursuant to Fed. R. Civ. P. 68.  The USCA affirmed the district court's denial of prejudgment interest, but vacate the district court's award of costs to Wal-Mart. 
        Mioli maintained that the district court erred in denying her motion for prejudgment interest because Wal-Mart's offer of judgment specifically included interest.  Mioli's argument that the terms of the offer conferred a substantive entitlement to prejudgment interest failed because in diversity jurisdiction, state law governs all awards of pre-judgment interest.  The district court thus did not err by applying Nevada law to determine Mioli's entitlement to prejudgment interest.  Mioli did not contend that the district court erred in its application of Nevada law.  The USCA thus affirmed the district court's denial of Mioli's motion for prejudgment interest.  Mioli also maintained that the district court erred in denying her motion for taxable costs.  That contention was inaccurate, however, as the district court granted Mioli's motion for costs and awarded her $710.25.  Mioli did not argue, nor did the record reflect, that this award was affected by the district court's finding that the final judgment was beaten by Wal-Mart's offer for purposes of Fed. R. Civ. P. 68.  The USCA thus affirmed the district court's award of $710.25 in taxable costs to Mioli.  Finally, Mioli maintained that the district court erred in awarding Wall-Mart $642.50 in taxable costs based on the court's determination that the final judgment was beaten by Wal-Mart's offer.  The USCA disagreed.  Wal-Mart's offer explicitly included costs, interest and attorneys' fees.  Mioli sought prejudgment interest in the amount of $7,801.27, far exceeding the difference between the jury's verdict and the offer.  Though Mioli was not enti-tled to recover prejudgment interest under Nevada law, the terms of Wal-Mart's offer required the district court to consider prejudgment interest in determining whether Mioli had bested Wal-Mart's offer for purposes of Fed. R. Civ. P. 68.  The USCA thus vacated the district court's award of $642.50 in taxable costs to Wal-Mart.

13)  COPYRIGHT INFRINGEMENT: Stell v. Jordan, 99-16580 (9th Cir. Mar. 21, 2001) (unpublished).  Hug, Noonan, and W. Fletcher, Circuit Judges.
        The District Court for Arizona, Judge McNamee presiding, granted summary judgment to Jordan and the other defendants in Stell's action for copyright infringement and Lanham Act violations.  The USCA reversed, finding a genuine issue of material fact as to whether Jordan composed the song at issue before Stell did.  The musicology expert's opinion that Jordan's song and Stell's song were "strikingly similar" permitted an inference of copying that challenged Jordan's claim of prior independent creation.  Up against Jordan's witnesses who stated that Jordan wrote his song first, Stell's expert's opinion was sufficient to create a genuine issue of material fact as to whether the witnesses were telling the truth.  There was thus a credibility issue to be determine at trial and summary judgment was improper.  The USCA thus reversed the district court's summary judgment and remanded for further proceedings.

14)  INTELLECTUAL PROPERTY: General Electric Corp. v. Ziarati, 99-56317 (9th Cir. Mar. 1, 2001) (unpublished).  Ferguson, Tashima, and Fisher, Circuit Judges.
        The trial court granted summary judgment on General Electric's "breach of contract / specific performance" claim, ordering assignment of the patents herein at issue to GE by its former employee, Ziarati.  The foundation of the district court's judgment was its conclusion that Ziarati is obligated under an Innovation Agreement to assign the patents to GE.  That conclusion, the USCA found, could not be sustained.  Ziarati, in his proposed statement of uncontroverted facts, asserted that the Innovation Agreement did not re-quire that he assign patents.  For the purpose of summary judgment, GE conceded, at trial and on appeal, Ziarati's proposed facts.  When the matter was called to the attention of the parties during oral argument before the USCA, counsel for GE did not claim mistake or excusable neglect or seek any relief.  The USCA thus concluded that it stood as a stipulated fact by the parties that the contract did not require Ziarati to assign his patents to GE.  That being the case, there could be no breach or specific performance of the contract regarding the assignment of patents.

15)  ATTORNEY OPINION LETTERS: First Bank of Marrietta v. Hufford, 99-16941 (9th Cir. Mar. 23, 2001) (unpublished).  B. Fletcher, Fernandez, and Paez, Circuit Judges.
       First Bank of Marrietta brought this against an attorney and his law firm, alleging that the attorney negligently or fraudulently induced it to purchase an illegal lease.  The District Court for Arizona, Judge Broomfield presiding, found the bank collaterally estopped from litigating the issue of the lease's validity due to earlier litigation between it and Kayenta Unified School District.  The USCA affirmed.
       The bank argued that because it did not oppose Kayenta's motion for summary judgment, the district court erred when it found that its claim was "actually litigated."  The USCA disagreed.  Although the bank did not file papers opposing the summary judgment motion, it did fully participate in proceedings leading up to that.  Moreover, following summary judgment, it filed motions for reconsideration and appealed to the Arizona Court of Appeals.  The USCA concluded that the bank had a more than ample opportunity to argue its position and did so.  Thus, the district court did not err.  Likewise the USCA concluded that the district court did not err when it held that the state court's determination of the lease's validity was essential to its decision.  The state court of appeals stated that the lease was valid because that was a necessary predicate to the decision which it was affirming.  The USCA held that the bank's argument that the issue was not essential failed.  Finally, the attorney requested attorneys' fees for both the district court action and this appeal.  However, the USCA held that because the attorney did not appeal the district court's order denying fees, the issue was not properly before it.  Thus, the attorney was not entitled to fees on appeal.  Under Ariz. Rev. Stat. Sec. 12-341.01, a court may grant reasonable attorneys' fees to the successful party in "any contested action arising out of a contract, express or implied."  However, this is not an action "arising out of a contract."  It is a claim of wrongful issuance of an opinion letter by an attorney.

16)  CONTRACTS: Calcor Space Facility, Inc. v. McDonnell Douglas Corporation, 99-56314 (9th Cir. Mar. 15, 2001) (unpublished).  Leavy, Trott, and Silverman, Circuit Judges.
        Calcor Space Facility appealed the judgment of the District Court for the Central District of California, Judge Tevrizian presiding, in Calcor's breach of contract action against McDonnell Douglas Corporation ("MDC").  Calcor presented three arguments:  that the district court erred in enforcing a partial settlement agreement, in denying a jury trial on the remaining contract claim; and in its computation of profit under the termination clause claim.  In its cross-appeal, MDC argued that the district court erroneously awarded duplicative profit in its computation.  The USCA affirmed in part and reversed in part.
        On April 7, 1988, the parties signed a one page memorandum entitled "Privileged Settlement Negotiations for Discussion Purposes Only" which set forth eight "bullets," included the dismissal of all claims in litigation except the "work in process" and "pricing" claims on the "MD-90" contract.  Calcor disputes the existence of mutual intent to be bound by the settlement negotiations.  The district court considered three objective factors in its finding that the parties intended to reach an enforceable partial settlement agreement.  First, in recent dealings between the parties, they performed in a similar manner by memorializing settlement terms in a signed informal memorandum, and commencing performance before their attorneys had prepared more formalized agreements.  Sec-ond, Calcor's representative stated that he was "committed," but had valid reasons not to sign a formalized document.  Finally, and most importantly, the memorandum provided for MDC to release work on hold valued at over $30 million to Calcor.  Calcor's acceptance of this consideration prevented it from denying its obligation under the agreement.  The USCA held that the district court's find-ings regarding the parties' intent were supported by the record and are not clearly erroneous.  Calcor argued that the district court erred in enforcing the settlement agreement without holding an evidentiary hearing, citing Callie v. Near, 829 F.2d 888 (9th Cir. 1987) (Where material facts concerning the existence or terms of an agreement to settle are in dispute, the parties must be allowed an evidentiary hearing.)  However, Calcor's argument failed for several reasons.  First, the record did not disclose any motion requesting an evidentiary hearing or a request to proffer additional evidence.  Second, the record indicated that the district court held an hour-long hearing on the motion to enforce the settlement agreement and considered the detailed memoranda and declarations from several persons, and also that no one requested a cross-examination of any of the declarants.  Finally, Callie is distinguishable.  In Callie, the defendants moved for entry of judgment, and thereafter the plaintiff requested an evidentiary hearing challenging the existence and validity of a settlement agreement.  The district court in Callie erred in granting the entry of judgment without first holding a requested evidentiary hearing. 
       The USCA also held that the district court did not err in denying Calcor's request for a jury trial as the remaining claim involved the interpretation of a specific contract term—the termination for convenience clause.  The district court determined that the language of this clause was not ambiguous and, thus that the parties' parole evidence was not admissible to determine its meaning.  The USCA held that the district court properly rejected Calcor's construction (inclusion of all costs to guarantee a profit) because the con-tract language, which had been extensively negotiated, did not support a construction of "guaranteed profit."  The USCA agreed with the district court that the contract was a "formula driven agreement" under the language of the clause.  However, it disagreed with the district court's inclusion of "reasonable profit" of $7,680,297 as a separate 11.11% calculation of the work satisfactorily performed (shipsets 1-96 for $64,422,000) plus work in progress (shipsets 97-143 for $4,707,588).  The district court's findings of fact stated that MDC had already paid the $4,707,588 work in progress claim and that "these sums included a profit of 15%."  Exhibit D provides that the prices are "firm fixed prices" and Calcor agreed with the court that the profit percentage on the work performed was 11.11% (although Calcor disputed the number it should be applied to).  Exhibit D provides for a $1,757,912 payment by MDC to Calcor if MDC did not order 300 shipsets.  It was undisputed that MDC already paid this amount for its failure to order 300 shipsets to the profit which was already included in the work performed and the work in progress, and precludes any additional profits.  The district court erred in including an additional 11.11% profit of $7,680,297 because an 11.11% profit calculation was previously negotiated in the fixed prices of work performed ($64,422,000) and a 15% profit calculation was already included in the work in progress ($4,707,588).  Thus, the USCA reversed that portion of the judgment awarding $5,921,814 to Calcor, and granted MDC's claim on cross appeal for a judgment in its favor for $1,758,483.