1)  SECURITIES LAW:  Vernazza v. SEC, 01-71857 (9th Cir. April 24, 2003).  Substantial evidence supported SEC findings that the petitioners, investment advisers and persons associated with advisers, knowingly or recklessly made materially false statements and omissions to their clients and in papers filed with the SEC, representing that they received no referral fees and had no financial interest in any of the recommendations they made to their clients.  D.W. Nelson (author), Wardlaw, and Fisher, Circuit Judges.  S. Jaffe of Los Angeles, CA, and T. Giachetti of Princeton, NJ, for the petitioners;  E. Summergrad of Washington, DC, for the respondent. (Download the full text of this decision at www.cc9.uscourts.gov/)

2)  TRADEMARKS:  KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 01-56055 (9th Cir. April 30, 2003).  A reasonable jury in a trademark infringement action could not conclude that "micro colors" is a generic term and incapable of receiving trademark protection;  the incontestable trademark registration for the composite mark of the term "micro colors" set in white, within a black box, was conclusive evidence that the mark is non-descriptive or has acquired secondary meaning.  Hug (author), Brunetti, and O'Scannlain, Circuit Judges.  C. Wu of Irvine, CA, for the defendants;  M. Machat of Beverly Hills, CA, for the plaintiff. (Download the full text of this decision at www.cc9.uscourts.gov/)

3)  TAXATION:  Elings v. CIR, 02-70457 (9th Cir. April 8, 2003).  Where the IRS fails to include the last date to petition the tax court for a redetermination on its notice of deficiency, but the taxpayer suffers no prejudice as a result, the notice is valid.  T.G. Nelson (author), Silverman, and McKeown, Circuit Judges.  G. Arnold of Santa Barbara, CA, for the petitioner; E. O'Connor of Washington, DC, for the respondent. (Download the full text of this decision at www.cc9.uscourts.gov/)

4)  BANKRUPTCY / STUDENT DEBT:  In re Saxman, 01-35620 (9th Cir. April 14, 2003).  Bankruptcy courts may partially discharge student debt pursuant to their equitable authority under 11 USC Sec. 105(a);  dissenting, Judge Wallace thought the appeal should be dismissed because Conn. Nat'l Bank v. Germain, 503 US 249 (1992), made it clear that jurisdiction over appeals of non-final orders in bankruptcy cases is governed by 28 USC Sec. 1292, pursuant to which, the appellate court in its discretion, may assume jurisdiction after the district court has certified a controlling question of law as to which there is substantial ground for difference of opinion;  thus Sec. 1292, rather than 28 USC Sec. 158(d), governs appellate jurisdiction over interlocutory orders such as the district court's decision in this case.  Wallace (dissenting), Trott, and Tashima (author), Circuit Judges.  D. Fisher of St. Paul, Minn., for the defendant; D. Saxman of Seattle, WA, pro se. (Download the full text of this decision at www.cc9.uscourts.gov/)

5)  BANKRUPTCY:  In re City of Desert Hot Springs, 02-55835 (9th Cir. April 29, 2003).  A bankruptcy court's order denying a motion to dismiss a voluntary Chapter 9 bankruptcy petition, based on a claim that it was brought in bad faith, was interlocutory;  the USCA thus lacked appellate jurisdiction over the dismissal.  Ferguson, Hall (author), and Berzon, Circuit Judges.  W. Davis of Los Angeles, CA, for the appellants;  J. Johnston of Los Angeles, CA, for the appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

6)  BANKRUPTCY:  Balser v. Dept. of Justice, 02-35114 (9th Cir. April 29, 2003).  The Bankruptcy Code does not contain an unequivocally waiver of sovereign immunity for U.S. trustees;  sovereign immunity thus barred a suit filed against a U.S. trustee based on acts conducted within the course and scope of his employment.  D.W. Nelson and Thomas (author), Circuit Judges, and D. Pregerson, District Court.  C. O'Grady of Phoenix, AZ, for the appellants;  AUSA R. Brouillard of Phoenix, AZ, for the appellees. (Download the full text of this decision at www.cc9.uscourts.gov/)

7)  ENVIRONMENTAL LAW:  Northern Plains Resource Council v. Fidelity Exploration & Development Co, 02-35836 (9th Cir. April 10, 2003).  Unaltered groundwater produced in association with methane gas extraction from coal seams, and discharged into a river, is a pollutant under the Clean Water Act (CWA);  the water discharged is "salty," contains several chemical constituents identified as pollutants in EPA regulations, has characteristics that may degrade soil, and is unfit for irrigation;  states cannot create exemptions to the CWA whether or not the EPA has delegated permitting authority to the state.  Reinhardt, W. Fletcher, and Gould (author), Circuit Judges.  J. Tuholske of Missoula, MT, for the appellant;  R. Waterman of Helena, MT, for the appellee.(Download the full text of this decision at www.cc9.uscourts.gov/)
 

 8)  ENVIRONMENTAL LAW / ATTORNEYS' FEES: Kasza v. Whitman, 00-16378 (9th Cir. April 14, 2003).  Because she did not gain by judgment or consent decree a material alteration of the legal relationship of the parties, the appellant was not a "prevailing party" under the fee-shifting provision of the Resource Conservation and Recovery Act of 1976, 42 USC Sec. 6972(e); the district court engaged in a reasoned evaluations of the government's proposed redactions of a previously sealed transcript;  concurring, Judge Wood urged the government, now that these cases are concluded, to consider releasing any information that might aid the plaintiffs in their treatment.  Wood (concurring), Rymer (author), and Tashima, Circuit Judges.  J. Turley of Washington, DC, for the appellants; R. Spritzer of Washington, DC, for the appellees.(Download the full text of this decision at www.cc9.uscourts.gov/)

9)  COMMUNICATIONS LAW / INTERNET:  Pacific Bell v. Pac-West Telecomm, Inc., 01-17161 (9th Cir. April 7, 2003).  California Public Utilities Commission's generic orders that reciprocal compensation provisions in interconnection agreements apply to calls to internet service providers, exceeded its authority under Sec. 252 of the Telecommunications Act of 1996 over interconnection agreements;  ISP-bound traffic is not exempt from the negotiated reciprocal compensation provisions of interconnection agreements.  Schroeder, Fisher, and Paez (author), Circuit Judges.  K. Fong of San Francisco, CA, for the appellant Pacific Bell;  K. Lippi of San Francisco, CA, for the CPUC;  D. Rodriquez of San Francisco, CA, for Pac-West Telecomm;  D. Bradford of Chicago, IL for intervenor WorldCom. (Download the full text of this decision at www.cc9.uscourts.gov/) [See Memo decisions #7 and #8 below]

10)  ARBITRATION / SANCTIONS:  G.C. and K.B. Investments v. Wilson, 00-56627 (9th Cir. April 23, 2003).  The district court properly had jurisdiction to issue an order confirming the arbitration award herein at issue;  Rooker-Feldman did not apply;  in confirming the plaintiff's arbitration award, the district court did not have to find that the state court order was wrong;  it simply dealt with the confirmability of the award pursuant to Sec. 9 of the Federal Arbitration Act, as opposed to the arbitrability of new claims raised in an amended complaint filed after the arbitration took place; there was no prohibited review of the state court order and no collateral attack on any such judgment;  the district court properly applied the Zaldiver standard for harassment and did not abuse its discretion in concluding that the defendants' successive filings were made for an improper purpose:  successive complaints based upon propositions of law previously rejected may constitute harassment under Rule 11.  Hug, Brunetti, and O'Scannlain (author), Circuit Judges.  G. Goebel of Van Nuys, CA, for the appellants;  B. Schlom of Los Angeles, CA, for the appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

11)  PRODUCT LIABILITY:  McEuin v. Crown Equipment Corp., 00-36043 (9th Cir. April 24, 2003).  In a product liability suit against a forklift manufacturer (for not putting a door on a forklift not designed for military use), the district court did not err in refusing the introduction of military forklift design specifications as irrelevant and reports of independent engineers consulted by defendant as inadmissible hearsay;  Judge O'Scannlain agreed with the majority that the military specifications were properly excluded, but thought the district court abused its discretion in refusing to admit the engineering reports.  B. Fletcher (author), O'Scannlain (dissenting in part), and Berzon, Circuit Judges.  D. Pyle of Portland, OR, for the defendants;  M. Zwerling of Portland, OR, for the plaintiff. (Download the full text of this decision at www.cc9.uscourts.gov/)

12)  LABOR & EMPLOYMENT LAW:  Lucas v. NLRB, 00-71452 (9th Cir. April 16, 2003).  Under the heightened duty of fair dealing applicable to a union's operation of an exclusive hiring hall, the NLRB's conclusion (that the union's refusal to readmit the plaintiff was necessary under the National Labor Relations Act) was not supported by substantial evidence;  concurring, Judge Wallace agreed with the majority that the NLRB's decision was not supported by substantial evidence, but declined to join in the majority's remand for entry of an order in favor of the petitioner; rather, he would remand for further findings.  Wallace (concurring) Kozinski, and Paez (author), Circuit Judges.  D. Carp of San Francisco, CA, for the petitioner;  J. Horowitz of Washington, DC, for the respondent. (Download the full text of this decision at www.cc9.uscourts.gov/)

13)  WRONGFUL TERMINATION:  Freund v. Nycomed Amersham, 01-56491 (9th Cir. April 22, 2003).  After wrongful termination in violation of California public policy, because the plaintiff had made bona fide safety complaints, an award of compensatory damages was valid under California Labor Code Sec. 6310;  the USCA also reversed the district court's order setting aside a punitive damages award;  dissenting, Judge Gould noted that the majority reinstated the plaintiff's punitive damages, which had been struck by the district court on post-verdict motion because of the lack of evidence of malice;  the majority's decision was based on the requirement of Fed. R. Civ. Proc. 50(b) that a motion for post-trial relief must state the same grounds for relief as the litigant's Fed. R. Civ. P. 50(a) directed verdict motion;  in so doing, Judge Gould thought the majority expanded the scope of a federal court's power in a diversity action beyond permissible bounds, produced a result contrary to the requirements of both Adams v. Murakami, 813 P.2d 1348 (Cal. 1991), and the Due Process Clause of the Fourteenth Amendment, and created a Circuit split in process.  Canby (author), Gould (dissenting), and Berzon, Circuit Judges.  T. Peterson of San Francisco, CA, for the defendant-appellants;  J. Adler of San Diego, CA, for the plain-iff-appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

14)  EMPLOYEES' COMPENSATION ACT: Moe v. USA, 02-35198 (9th Cir. April 18, 2003).  Psychological injury accompanied by physical injury, regardless of the order in which they occur, is within the scope of the Federal Employees' Compensation Act;  the district court thus lacked jurisdiction over the plaintiff's claim;  the plaintiff had alleged a claim that was colorable under the FECA because she had sustained emotional injuries that resulted in physical injuries, while in the performance of her duties as a federal employee; be-ause the FECA provides this plaintiff's exclusive remedy, the courts lacked jurisdiction over her claim under the Federal Torts Claim Act.  Brunetti, T.G. Nelson (author), and Rawlinson, Circuit Judges.  AAG R. McCallum of Washington, DC, for the defendant;  J. Moore of Yakima, WA, for the plaintiff.  (Download the full text of this decision at www.cc9.uscourts.gov/)

15)  LABOR LAW / FIRST AMENDMENT:  Hobler v. Brueher, 00-35589 (9th Cir. April 8, 2003).  An elected prosecutor did not have to retain at-will confidential secretaries hired by the predecessor he defeated and who supported the predecessor politically;  because the plaintiffs' were "confidential employees" in the sense set out in Branti v. Finkel, 445 US 507 (1980), the First Amendment did not protect them from dismissal due to their political loyalty to the defendant's political adversary.  Canby, Kleinfeld (author), and Ward-law, Circuit Judges.  S. Lacy of East Wenatchee, WA, for the appellants;  M. Gaston of Spokane, WA, for the appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

16)  LABOR LAW:  Ostad v. Oregon Health Sciences University, 00-36060 (9th Cir. April 28, 2003).  In suit based on the plaintiff's claim that his termination from a hospital residency program was in retaliation for questioning a doctor's billing practices, the hospital waived the right to have its liability considered apart from that of the doctor;  jury instructions properly stated the law governing liability for First Amendment retaliation;  dissenting in part, Judge O'Scannlain agreed that the district court did not err in denying the defendants' motion for judgment as a matter of law and that the hospital waived any right to have its liability considered separate from that of the doctor; he also agreed that the district court did not abuse its discretion in any of the contested evidentiary rulings;  however, Judge O'Scannlain would hold that the doctor and hospital are entitled to a new trial on the basis of an improper jury instruction, as he thought the district court did not properly instruct the jury that to prevail on the retaliation claim, the plaintiff's protected activities had to be a "substantial or motivating factor" in his termination;  the district court, he thought, erred in instructing jurors that the protected conduct needed only to be a "significant factor" in the termination.  B. Fletcher (author), O'Scannlain (dissenting in part), and Berzon, Circuit Judges.  B. Lyon of Portland, OR, for the defendants-appellants;  S. Hunt of Portland, OR, for the plaintiff-appellee.(Download the full text of this decision at www.cc9.uscourts.gov/)

17)  AMERICANS WITH DISABILITY ACT:  Kaplan v. City of North Las Vegas, 02-16048 (9th Cir. April 1, 2003).  After being injured in a training exercise, the plaintiff, a peace officer, could not hold a gun or grasp objects with his right hand;  when his pain continued after therapy, his slow recovery was attributed to rheumatoid arthritis, a conclusion later determined to be a misdiagnosis;  based on this misdiagnosis, his employer, the City of North Las Vegas, believed the injury was permanent and fired him;  as he could not perform his essential job functions without accommodation at the time of his termination and the City had no duty to accommodate him, the plaintiff's Americans with Disability Act claim was not actionable.  Silverman and Gould (author), Circuit Judges, and Weiner, District Judge.  J. Gallo of Las Vegas, NV, for the plaintiff-appellant;  M. Kotchka of Las Vegas, NV, for the defendants-appellees. (Download the full text of this decision at www.cc9.uscourts.gov/)
 

18)  CIVIL PROCEDURE:  Mann v. American Airlines, 01-35803 (9th Cir. April 1, 2003).  Failure to serve process within the initial 120-day period required (absent time extension) by Fed. R. Civ. P. 4(m) did not cause the statute of limitations to run again;  the district court had discretion to extend the time to serve process even after expiration of the 120-day period where the statute of limitations would otherwise bar the refilling of the suit if the district court had declined extension of time and had dismissed the suit.  Reinhardt, W. Fletcher, and Gould (author), Circuit Judges. D. Cloud of Tacoma, WA, for the appellant; K. O'Brien of Sacramento, CA, for the ap-pellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

19)  CIVIL RIGHTS / STATE ACTION:  Kirtley v. Rainey, 01-35740 (9th Cir. April 22, 2003).  A state-appointed guardian ad litem does not act under color of state law for purposes of 42 USC Sec. 1983;  the guardian's function in the instant case, as articulated in a Washington state statute, did not qualify as state action.  Noonan, Hawkins (author), and Gould, Circuit Judges.  M. Gunther of Kent, WA, for the appellant;  C. Longacre of Port Orchard, WA, K. Lappi of Silverman, WA, and G. Curwen of Tacoma, WA, for the appellees. (Download the full text of this decision at www.cc9.uscourts.gov/)

20) REAL ESTATE / NON-JUDICIAL FORECLOSURES / STATE ACTION: Apao v. Bank of New York, 01-16565 (9th Cir. April 4, 2003). Hawaii's statutorily authorized non-judicial foreclosure procedures, Hawaii Rev. Stat. Sec. 667-5, did not violate the Due Process Clause of the Fourteenth Amendment in this case, as there was insufficient state involvement;  the sale following foreclosure was a purely private remedy and involved no state action.  Schroeder (author), Alarcon, and Fisher, Circuit Judges.  G. Dubin of Honolulu, HI, for the plaintiff;  R. J. Seibert of Honolulu, HI, for the defendant. (Download the full text of this decision at www.cc9.uscourts.gov/)

21)  ASSET FORFEITURE:  Zeltser v. City of Oakland, 01-17430 (9th Cir. April 8, 2003).  The district court held that as a matter of law the City of Oakland did not violate a pawnbroker's right to due process when it failed to provide her with notice and an opportunity to be heard before returning to its original owner a ring seized from her pawnshop;  reversing, the USCA held that the district court's summary judgment in favor of the City was contrary to Circuit law requiring the application of Cal. Fin. Code Sec. 21206.8 and Cal. Penal Code Sec. 1407 et seq. when property is seized from a pawnbroker;  in the absence of any justification for denying the pawnbroker the opportunity to assert her ownership interest in the ring, summary judgment was inappropriate;  the City deprived the pawnbroker of her constitutional right to due process of law by failing to comply with the statutory provisions governing the disposition of property seized from a pawnbroker pursuant to a warrant.  Trott, Rymer, and Tallman (author), Circuit Judges.  H. Noffsinger of Pleasant Hill, CA, for the plaintiff-appellant;  K. Salem-Boyd of Oakland, CA, for the defendants-appellees.(Download the full text of this decision at www.cc9.uscourts.gov/)

22)  EQUAL PROTECTION:  Flores v. Morgan Hill Unified School District, 02-15128 (9th Cir. April 8, 2003).  Finding sufficient evidence for a jury to infer that the defendants acted with deliberate indifference to the plaintiffs' complaints of student-to-student anti-homosexual harassment, the USCA upheld the district court's denial of the defendants' motion for summary judgment on qualified immunity grounds;  the record contained sufficient evidence for a jury to conclude that the defendants intentionally discriminated against the plaintiffs in violation of the Equal protection Clause; at the time of the harassment, the plaintiffs' right to be free from intentional discrimination on the basis of sexual orientation was clearly established.  Schroeder (author) Paez, and Tallman, Circuit Judges.  M. Davis of San Jose, CA, for the defendants-appellants;  J. Emery of San Francisco, CA, for the plaintiffs-appellees. (Download the full text of this decision at www.cc9.uscourts.gov/)

23)  GOVERNMENT BENEFITS, INDIAN LAW:  Navajo Nation v. Dept. of Health & Human Services, 99-16129 (9th Cir. April 8, 2003).  The Temporary Assistance for Needy Families welfare grant program is not a "contractible program" under the self-determination provisions of the Indian Self-Determination and Education Assistance Act.  Schroeder, B. Fletcher, Trott, Rymer, Thomas, Graber, McKe-own (author), Wardlaw, Gould, Berzon, and Clifton, Circuit Judges.  T. Christie of Window Rock, Navajo Nation, AZ, for the appellant;  D. Ogden of Washington, DC, for the appellee.(Download the full text of this decision at www.cc9.uscourts.gov/)

24)  IMMIGRATION / PERJURY:  USA v. Chen, 02-10327 (9th Cir. April 7, 2003). An asylum applicant's concededly false statements as to when and how he entered the United States were material and supported convictions for perjury and making a false statement under 18 USC Secs. 1621 and 1001, as they could have affected or influenced the exercise of a governmental function.  Schroeder (author), Goodwin, and Tashima, Circuit Judges.  W. Bischoff, of Hagatna, GU, for the defendant;  AUSA K. Johnson of Hagatna, GU, for the plaintiff. (Download the full text of this decision at www.cc9.uscourts.gov/)

25)  IMMIGRATION:  Vasquez-Zavala v. Ashcroft, 01-70973 (9th Cir. April 7, 2003). Petitioners who merely filed for asylum prior to the effective date of the Illegal Immigration Reform and Immigrant Responsibility Act, April 1, 1997, could not have had "settled expectations" of being placed in deportation proceedings rather than removal proceedings.  Schroeder, Noonan, and Clifton (author), Circuit Judges.  W. Pineda of Redwood City, CA, for the petitioners;  A. Nicastro of Washington, DC, for the respondent. (Download the full text of this decision at www.cc9.uscourts.gov/)

26)  IMMIGRATION:  Manjiyani v. INS, 01-70415 (9th Cir. April 11, 2003).  A notice of a deportation hearing was sufficient where it was sent to petitioner's last address known to the Immigration Judge, whereas the last address known to the INS was on forms unrelated to petitioner's deportation proceedings;  dissenting, Judge Fletcher thought the majority had adopted a rule that permits the INS to deport an alien in absentia when, in full knowledge of the alien's current address, it fails to mail notice to the alien of the deportation proceedings;  she thought due process did not permit such a result.  B. Fletcher (dissenting) and Gould, Circuit Judges, and Murguia (author), District Judge.  T. Greene of Payallup, WA, for the petitioner;  M. Walters of Washington, DC, for the respondent. (Download the full text of this decision at www.cc9.uscourts.gov/)

27)  IMMIGRATION:  Murillo-Salmeron v. INS, 02-70704 (9th Cir. April 28, 2003).  The BIA committed legal error in deporting the petitioner based on his ineligibility for a waiver which, as the immigration judge noted in the very decision under review, was not required in the first place;  the USCA noted that, although it seems plain enough that the petitioner's 25 years of U.S. residence, four dependent citizen children, and entire extended family within the U.S. more than outweigh his stale DUI conviction, the procedural posture of the case required the USCA to return it to the BIA.  Noonan,  Tashima, and Wardlaw (author), Circuit Judges.  R. Jobe of San Francisco, CA, for the petitioner;  R. McCallum of Washington, DC, for the respondent. (Download the full text of this decision at www.cc9.uscourts.gov/)

28)  IMMIGRATION:  Romero-Torres v. Ashcroft, 01-71638 (9th Cir. April 28, 2003).  On an issue of first impression in the Circuit, the USCA concluded that it lacked jurisdiction to review the Board of Immigration Appeals' discretionary denial of an application for cancellation of removal based on rejected claims of "exceptional and extremely unusual hardship."  T.G. Nelson, Silverman, and McKeown (author), Circuit Judges.  K. Bove of Escondido, CA, for the petitioner;  R. McCallum of Washington, DC, for the respondent. (Download the full text of this decision at www.cc9.uscourts.gov/)

29)  IMMIGRATION / IMMIGRANT INVESTORS: Chang v. USA, 01-56266 (9th Cir. April 29, 2003).  The INS may not retroactively apply 1998 changes in EB-5 rules in reviewing the I-829 petitions of those whose I-526 petitions had been approved before the new rules were promulgated.  B. Fletcher (author) and Hawkins, Circuit Judges, and Bury, District Judge.  I. Kurzban of Miami, FL, for the plaintiff;  J. Cunningham of Washington, DC, for the defendant.(Download the full text of this decision at www.cc9.uscourts.gov/)

30) IMMIGRATION / INEFFECTIVE ASSISTANCE:  Monjaraz-Munoz v. INS, 02-70227 (9th Cir. April 28, 2003).  An alien's reason for failing to appear at his deportation hearing, his reliance on negligent advice from an attorney's agent, constituted "exceptional circumstances" beyond the alien's control under 8 USC Sec. 1229a(e)(1) and required the rescission of an in absentia deportation order and the reopening of immigration proceedings.  Hall (author), Thompson, and Berzon, Circuit Judges.  K. Kraus of San Diego, CA, for the petitioner;  J. Parker of Washington, DC, for the respondent.(Download the full text of this decision at www.cc9.uscourts.gov/)

31)  IMMIGRATION / CRIMINAL LAW:  Nevarez-Martinez v. INS, 02-70049 (9th Cir. April 16, 2003).  The record did not support the petitioner's removal from the U.S. as an alien convicted for a "theft offense" under 8 USC Sec. 1101(a)(43)(G), where the alien had been convicted only of "theft of a means of transportation" under Arizona law; the alien's conviction did not make him an aggravated felon.  Noonan (author), Tashima, and Wardlaw, Circuit Judges.  H. Han of Seattle, WA, for the petitioner;  A. Mai of Washington, DC, for the respondents. (Download the full text of this decision at www.cc9.uscourts.gov/)

32)  IMMIGRATION:  USA v. Tinoso, 02-10128 (9th Cir. April 25, 2003). The district court exceeded its authority under 18 USC Sec. 3583(d) in ordering the immediate and automatic deportation of a citizen of the Philippines, without a deportation hearing, as a condition of his supervised release under 18 USC Sec. 3583(d); deportation and removal must be achieved under the procedures set out in the Immigration and Naturalization Act.  Schroeder, Goodwin, and Tashima (author), Circuit Judges.  G. P. Civille of Hagatna, GU, for the defendant;  AUSA M. David of Hagatna, GU, for the plaintiff.(Download the full text of this decision at www.cc9.uscourts.gov/)

33)  INVESTIGATORY TRAFFIC STOPS:  USA v. Fernandez-Castillo, 01-30398 (9th Cir. April 8, 2003).  A police officer had reasonable suspicion that the driver of a car was impaired, justifying an investigatory traffic stop, where 1) the car had been reported as driving erratically;  2) the officer who stopped the car knew the source of the report;  3) the report described the car in detail, noting its color, make and model, and state license plate;  4) the report was made contemporaneously with the source's observations of the erratic driving; 5)  the officer discovered the car in the area where the report indicated that the car would likely be found;  6) the officer noticed that the driver was sitting very close to the steering wheel, a behavior the officer knew was typical of impaired drivers;  and, 7), the officer corroborated the report of erratic driving by observing the car weave within its lane;  given the totality of these circumstances, the USCA held that the district court correctly found, after an evidentiary hearing, the existence of a reasonable suspicion that the driver was impaired and properly held that the investigatory stop of the car was constitutional.  Ferguson (dissenting), Fisher, and Tallman (author), Circuit Judges.  R. Kelleher of Billings, MT, for the appellant;  AUSA L. Harper Suek of Great Falls, MT, for the appellee.(Download the full text of this decision at www.cc9.uscourts.gov/)

34)  SEARCH & SEIZURE:  USA v. Celestine, 00-50669 (9th Cir. April 4, 2003).  A search did not violate Fed. R. Crim. P 41 where the affidavit in support of probable cause did not accompany other documents that comprised the warrant, but was served on defendant's attorney after the search;  policies underlying the warrant requirement were satisfied by the elements of the warrant served on the defendant during the search.  B. Fletcher (author), Alarcon, and Hawkins, Circuit Judges.  G. Simon of Los Angeles, CA, for the defendant;  AUSA M. Raphael of Los Angeles, CA, for the plaintiff. (Download the full text of this decision at www.cc9.uscourts.gov/)

35)  EVIDENCE:  USA v. Brown, 01-30261 (9th Cir. April 25, 2003).  The trial court committed reversible error in failing to cure the prosecution's statements during closing arguments, regarding alleged "other acts" evidence under Fed. R. Evid. 404;  dissenting, Judge Graber thought that the defendant's convictions and sentence should be affirmed; she thought the district court did not err in concluding that the evidence offered was "inextricably intertwined" with the crime charged and, when evidence of other acts is inextricably intertwined with evidence of the charged crime, the other-acts evidence is admissible notwithstanding Rule 404.  B. Fletcher (author), Alarcon, and Graber (dissenting), Circuit Judges.  J. Wendt of Anchorage, AK, for the defendant-appellant;  A. Ciongoli of Washington, DC, for the plaintiff-appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

36)  PERJURY:  USA v. McKenna, 01-10357 (9th Cir. April 18, 2003).  The USCA upheld the defendant's convictions for perjury and making false declarations under oath for various statements she made during the course of her civil action against the government stemming from her car accident with a U.S. Postal Service truck;  the prosecutor did not engage in improper vouching;  the "perjury trap" doctrine does not apply in civil depositions or civil trials.  Goodwin (author), Tashima, and Wardlaw, Circuit Judges.  J. Jordan of San Francisco, CA, for the defendant-appellant;  AUSA L. Gray of San Francisco, CA, for the plaintiff-appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

37)  THEFT OF FEDERAL FUNDS:  USA v. Cabrera, 01-10152 (9th Cir. April 30, 2003).  Assuming (but leaving open the issue) that to get a conviction under 18 USC Sec. 666, the government had to prove that the theft at issue had some effect on a program receiving federal funds, such a requirement was more than satisfied where Cabrera, as the Secretary of Finance of the Commonwealth of the Northern Mariana Islands, stole from federal funds within his control.  Schroeder (author), Alarcon, and Fisher, Circuit Judges.  B. Berline of Saipan, MI, for the defendant-appellant;  J. Rice of Saipan, MI, for the plaintiff-appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

38)  THEFT OF FEDERAL FUNDS:  USA v. Bynum, 02-10016 (9th Cir. April 30, 2003).  18 USC Sec. 666, pertaining to the theft of federal funds, is facially constitutional, and the finding of a federal nexus to the violation of Sec. 666 (if one is required) is a question of law for the courts rather than an element of the offense;  the district court did not err in imposing a two-level sentence enhancement pursuant to Sentencing Guidelines Sec. 2C1.1(b)(1) and an eight-level sentence enhancement as required by Sec. 2C1.1(b)(2)(B).  Schroeder, Alarcon (author), and Fisher, Circuit Judges.  AFPD W. Domingo of Honolulu, HI, for the defendant-appellant;  AUSA J. M. Seabright of Honolulu, HI, for the plaintiff-appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

39)  FALSE STATEMENTS ON FAA FORMS:  USA v. Culliton, 00-10599 (9th Cir. The opinion filed Aug. 22, 2002 has been withdrawn and replaced by this opinion filed April 30, 2003).  The USCA affirmed the defendant's conviction, following a jury trial, for making knowing and willful false statements on a medical form submitted to the Federal Aviation Administration;  the court rejected the defendant's assertions that:  1) the FAA form is fundamentally ambiguous and thus the district court should have dismissed the government's false statement indictment; 2) defendant's felony conviction resulted from selective prosecution and thus amounted to a denial of Due Process; and, 3), that the doctrine of primary jurisdiction prevented the district court from presiding over the indictment until, and unless, the FAA first revoke the defendant's medical certification.  Goodwin, Hawkins, and Fisher, Circuit Judges.  Per Curiam.  R. Staff of Sacramento, CA, for the defendant;  AUSA J. Arguelles of Sacramento, CA, for the plaintiff. (Download the full text of this decision at www.cc9.uscourts.gov/)

40)  CRIMINAL PROCEDURE:  USA v. Arnett, 00-10170 (9th Cir. April 24, 2003).  The defendant was collaterally estopped from relitigating an issue he argued and lost in his Oregon state trial—namely, that the short-barreled shotgun he used in California and Oregon bank robberies was an "antique" under 18 USC Section 921(a)(3) and (a)(16)(A);  the Federal District Court correctly concluded that the defendant was estopped from relitigating this issues.  Trott, Rymer, and Tallman (author), Circuit Judges.  T. Arnett pro se;  AUSA F. Papagni of Eugene, OR, for the plaintiff-appellee.(Download the full text of this decision at www.cc9.uscourts.gov/)

41)  INEFFICIENT ASSISTANCE: McClure v. Thompson, 01-35593 (9th Cir. April 2, 2003).  No breach of the duty of confidentiality and no conflict of interest arose due to the original defense counsel's anonymous phone call to law enforcement officials in which he disclosed the location of the bodies of children whom the petitioner was ultimately convicted of killing; the denial of the petitioner's habeas petition alleging ineffective assistance thus was upheld;  dissenting, Judge Ferguson thought the majority erred when it held that the attorney's disclosure of the location of the bodies did not constitute deficient performance under Strickland v. Washington, 466 US 668 (1984).  Ferguson (dissenting), W. Fletcher (author), Circuit Judges, and King, District Judge.  FPD S. Wax of Portland, OR, for the petitioner;  D. Casey of Salem, OR, for the respondent.(Download the full text of this decision at www.cc9.uscourts.gov/)

42)  SENTENCING:  USA v. Leonti, 01-17113 (9th Cir. April 24, 2003).  A viable ineffective assistance of counsel claim can arise from counsel's failure to effectively assist a defendant awaiting sentencing in his efforts to provide cooperation to an interested government;  the presentencing cooperation period is a critical stage of the criminal process, and obtaining a substantial assistance motion from the government represents a particularly critical point in that process.  Cowen, Hawkins (author), and W. Fletcher, Circuit Judges.  K. Landau of Sausalito, CA, for the defendant-appellant;  AUSA T. Muehleck of Honolulu, HI, for the plaintiff-appellee. (Download the full text of this decision at www.cc9.uscourts.gov/)

43)  SENTENCING:  USA v. Etimani, 01-10435 (9th Cir. April 21, 2003).  18 USC Sec. 3509, which set forth the procedure by which an alleged child victim can testify outside of the physical presence of the defendant via two-way closed circuit TV, does not required that a TV monitor projecting the defendant's image be in the child's direct field of vision while she is facing forward, although the monitor must be 1) called to the child's attention, 2) visible with little effort from where the child is seated while testifying, and, 3), the jury is able to see whether or not the child looks at the monitor during her testimony;  a California prior conviction did not qualify as a "first strike" for a two-strikes enhancement under 18 USC Sec. 2241(c), where in that state court the defendant pled no-contest to "lewd and lascivious conduct upon a child and the government failed to establish that the conviction involved a "sexual act," as opposed to "sexual conduct," as defined by federal law.  Silverman (author) and Gould, Circuit Judges, and Sedwick, District Judge.  D. Klein of Honolulu, HI, for the defendant;  AUSA M. Rotker of Washington, DC, for the plaintiff. (Download the full text of this decision at www.cc9.uscourts.gov/)

44)  HABEAS CORPUS / SPEEDY TRIAL RIGHTS: McNeely v. Blanas, 02-15860 (9th Cir. April 18, 2003).  A pre-trial detainee's constitutional speedy trial rights were denied where he had been in custody since April 1998 without a preliminary hearing or trial;  the USCA reversed the district court's dismissal of the detainee's 28 USC Sec. 2241 habeas petition and ordered that the petitioner be immediately released from custody with prejudice to reprosecution of the criminal charges;  however, the USCA directed that its order be without prejudice to the institution of such civil commitment proceedings as may be appropriate under state law.  Noonan, Tashima (author), and Wardlaw, Circuit Judges.  AFPD D. Broderick of Sacramento, CA, for the petitioner-appellant;  C. Meyers of Sacramento, CA, for the respondent-appellee.  (Download the full text of this decision at www.cc9.uscourts.gov/)

45)  HABEAS CORPUS:  Koerner v. Grigas, 01-15345 (9th Cir. April 28, 2003).  As the Nevada Supreme Court did not rely upon an "independent and adequate" state ground in denying the petitioner's claim that he was denied a direct appeal from his original conviction, his claim that attorneys failed to file a direct appeal was not procedurally defaulted;  dissenting, Judge Beezer thought that in concluding that it was error to look to the circumstances surrounding an ambiguous state court order in determining whether the petitioner's ineffective assistance of trial counsel claim was procedurally defaulted, the majority had ignored the clear teachings of Coleman v. Thompson, 501 US 722 (1991) and Ylst v. Nunnemaker, 501 US 797 (1991);  Judge Beezer would hold that the district court correctly found that the petitioner's ineffective assistance of trial counsel would not be heard in federal court because it was procedurally defaulted in the Nevada courts on an "independent and adequate" state ground.  D.W. Nelson (author), Beezer (dissenting), and Wardlaw, Circuit Judges.  K. Koerner pro se;  D. Neidert of Carson City, NV, for the respondent-appellee.(Download the full text of this decision at www.cc9.uscourts.gov/)

46)  HABEAS CORPUS:  Ivy v. Pontesso, 00-16381 (9th Cir. April 30, 2003).  The fact that the petitioner could not raise a procedurally-barred "actual innocence" claim did not mean that the 28 USC Sec. 2255 remedy is "inadequate or ineffective," as the claim could have been raised in an initial petition;  to the extent that the petitioner may have a viable claim of innocence, something the USCA did not decide, he has not been denied an unobstructed procedural opportunity to present it.  Sneed (author), McKeown, and Paez, Circuit Judges.  AFPD M. Burke of Phoenix, AZ, for the appellant;  AUSA M. Rotker of Washington, DC, for the appellee.  (Download the full text of this decision at www.cc9.uscourts.gov/)

 1)  COPYRIGHTS:  Lynch v. Trendwest Resorts, Inc., 01-35909 (9th Cir. April 18, 2003) (unpublished).  D.W. Nelson and Thomas, Circuit Judges, and D. Pregerson, District Judge.
         Lynch appealed the district court's judgment in his copyright infringement suit against Trendwest Resorts.
The USCA affirmed, finding that, following a jury trial, the district court properly determined that Lynch's suit was one seeking indirect, rather than direct, profits as damages for infringement, and that summary judgment was appropriate on the indirect profits claims.  As noted in Mackie v. Rieser, 296 F.3d 909, 911 (9th Cir. 2002), 17 USC Sec. 504(b) erects a two-prong "profits" structure, treating "direct" and "indirect" profits distinctly.  Direct profits are those generated by selling infringing products;  indirect profits are revenue having a more attenuated nexus to the infringement.  The district court correctly determined that Lynch's claim is for "indirect" profits as he was not seeking a portion of the profits that Trendwest derived from direct sales of a videotape containing the infringing material.  Rather, the profits at issue were generated from the sale of time share condominiums.  Thus, the district court correctly construed this as an indirect profits case.  As a plaintiff seeking "indirect" profits under Sec. 504(b), Lynch had to "proffer some evidence to create a triable issue regarding whether the infringement at least partially caused the profits that the infringer generated as a result of the infringement."  Mackie, 296 F.3d at 911.  Sufficient non-speculative evidence of a connection between the infringement and the profits generated indirectly," is necessary to sustain an "indirect" profits claims.  Lynch proffered insufficient specific, non-conjectural evidence upon which a finder of fact could construct an "indirect" profits damage analysis.  Indeed, Trendwest supplied the direct evidence tendered in the case, which consisted of affidavits stating that, based on comparative date, there were no additional sales gained or lost through the use of the promotional video.  Lynch urged the USCA to infer the requisite proof from the facts;  however, Mackie requires more.  Given the state of the record, the district court's summary judgment decision for Trendwest on Lynch's profits claim was proper.  In light of the absence of direct proof, the USCA declined to opine as to what quantum of proof would be necessary to avoid summary judgment.
      Lynch also appealed the jury's finding of non-infringement as to Trendwest's uses of certain videos.  However, he did not preserve this issue for appellate review because he did not move for judgment as a matter of law at the close of the evidence and renew the motion after the verdict.  To reverse for plain error, the USCA said it must find an error that is plain and that affects substantial rights.  If the threshold requirements are satisfied, the USCA must also conclude that the error seriously affects the fairness, integrity or public reputation of judicial proceedings.  No plain error infected the relevant portions of the jury's verdict;  rather, it was a reasonable evaluation of the evidence proferred, and it in no way detrimentally affected Lynch's substantial rights.

2)  TAXATION:  Metcalf v. CIR, 02-72889 (9th Cir. April 17, 2003) (unpublished).  Rymer, Kleinfeld, and Fisher, Circuit Judges.   The taxpayer appealed pro se the tax court's order denying his claim for overpayment of taxes on his individual retirement account (IRA) income for the 1996 tax year.  The USCA affirmed.  The tax court properly denied the taxpayer's claim for overpayment because his 1996 IRA distribution was taxable as income when he failed to roll over the distribution into another IRA account within 60 days of receipt.  The taxpayer's contention that 26 USC Sec. 6511(a) allows three years to roll over his IRA distribution lacked merit because that provision refers only to the time in which an amended return may be filed.  The taxpayer's remaining contentions also lacked merit.

3)  TAXATION / EVIDENCE:  Lee v. CIR, 02-72171 (9th Cir. April 17, 2003) (unpublished).  Rymer, Kleinfeld, and Fisher, Circuit Judges. 
       Lee appealed pro se the tax court's decision upholding the CIR's determination of federal income tax deficiencies for the years 1995, 1996, 1997, and 1998.  The USCA affirmed.  The tax court did not err in upholding the CIR's deficiency assessments.  Although the CIR proffered numerous documents evincing Lee's income during the years in question, Lee's sole evidence was his bare denial of receipt of income and his objection to the CIR's evidence on Fifth Amendment grounds.  Under these circumstances, the tax court properly found that the CIR had established that Lee had received the income assessed.  See USA v. Rylander, 460 US 752, 758 (1983) (the assertion of Fifth Amendment privilege is not a substitute for evidence that would assist in meeting a burden of production).  Lee maintained that the tax court erred by admitting third party records that were hearsay and lacked authentication.  However, the USCA found that the tax court properly applied Tax Court Rule 91(f) and properly determined that the third party records were self-authenticating (see Fed. R. Evid. 902(1)) and exempted from hearsay rule (see Fed. R. Evid. 803(10)).  The tax court also properly determined that these rulings did not present a real and appreciable danger of self-incrimination to Lee, or violate his Sixth Amendment right to confrontation of witnesses.  See USA v. Neff, 615 F.2d 1235, 1241-1242 (9th Cir. 1980) (the admission of documents under Rule 802(10) does not violate right to confrontation).

4)  TAXATION:  Myers v. IRS, 02-56724 (9th Cir. April 17, 2003) (unpublished).  Rymer, Kleinfeld, and Fisher, Circuit Judges.   Myers appealed pro se the district court's summary judgment for the CIR in his action seeking review of the Notice of Determination approving collection actions against him for his 1998 employment tax liability. 
      The USCA affirmed.  It found no merit in Myers' contention that the compensation he paid his employees was not taxable as gross income.  26 USC Sec. 61 (gross income includes "all income from whatever source derived").  Moreover, contrary to Myers' contention, the CIR "was entitled to collect by levy the unpaid taxes," and timely did so "within three years from the date the tax return was filed."  Brookhurst, Inc. v. USA, 931 F.2d 554, 557 (9th Cir. 1991).  In addition, Myers failed to raise a genuine issue of material fact as to whether the Form 4340 Certificate of Assessments and Payments was inaccurate.  Myers maintained that the Appeals Officer at the Collection Due Process Hearing and the district court failed to consider his arguments, denied him due process, and violated his First Amendment rights.  These contentions, the USCA noted, are not supported by the record.  Finally, the CIR moved for sanctions pursuant to Fed. R. App. P. 38 and 28 USC Sec. 1912.  "This appeal is frivolous because the result is obvious and the arguments of error are wholly without merit." Gattuso v. Pecorella, 733 F.2d 709, 710 (9th Cir. 1984) (Per Curiam).  The USCA thus imposed a sanction of $4,000.

5)  TAXATION:  Johnson v. Franchise Tax Board, 02-56580 (9th Cir. April 21, 2003) (unpublished).  Rymer, Kleinfeld, and Fisher, Circuit Judges.
       Johnson appealed pro se the district court's sua sponte Fed. R. Civ. P. 12(b)(6) dismissal of his action alleging violations of the Federal Credit Reporting Act (FCRA), the Fair Debt Collections Practices Act (FDCPA), the Fourteenth Amendment, and state tort law.
 The USCA affirmed.  The Illinois district court did not abuse its discretion when it transferred Johnson's case to the Central District of California because no events alleged in the complaint took place in Illinois, a substantial part of the events took place in California, and all the defendants reside in California.  The district court properly dismissed Johnson's claim under the FCRA because the provision he cited, 15 USC Sec. 1681s-2(a), may only be enforced by federal and state officials.  The district court properly dismissed Johnson's claims under FDCPA because the Franchise Tax Board is not a "debt collector" as defined by the statute.  See 15 USC Sec. 1692a(6)(C).  The district court properly dismissed Johnson's RICO claim because government entities are incapable of forming the malicious intent necessary to support a RICO action.  It properly dismissed Johnson's 42 USC Sec. 1983 claim alleging California's pre-judgment child support procedures violated due process because any review would necessarily affect the child support order or judgment issued by the state court.  The district court properly dismissed Johnson's Sec. 1983 claim alleging California's post-judgment child support procedures violated due process because the procedures provide for notice to be sent to an individual at least 20 days before garnishment of his funds and a meaningful state, post-deprivation remedy for the loss is available.  Finally, the USCA found it had no basis to review the district court's denial of Johnson's motion to alter or amend the judgment because it was not submitted with his appeal.

6)  BANKRUPTCY:  In re Cohen & Steinbrecher, 02-15018 (9th Cir. April 25, 2003) (unpublished).  Rymer, Kleinfeld (dissenting), and Paez, Circuit Judges.
      Bob M. Cohen & Associates Law Corporation ("Cohen") appealed from the Bankruptcy Appellate Panel's decision affirming the bankruptcy court's denial of Cohen's "Motion … For Further Enforcement of Settlement Agreement and Related Court Orders" and affirming the bankruptcy court's imposition of sanctions.  Cohen did not challenge bankruptcy court's factual findings.
       The USCA affirmed the bankrptcy court's denial of Cohen's motion for the reasons stated by the BAP.  It also held that the bankruptcy court did not abuse its discretion by sanctioning Cohen pursuant to its inherent authority.  However, it declined to consider Cohen's other arguments relating to sanctions that are raised for the first time on appeal.
       Judge Kleinfeld dissented.  First, he noted that the BAP held that the settlement agreement between Cohen and Steinbrecher contemplated the fee-splitting arrangement with Gilbert, which was already in place when Cohen and Steinbrecher signed the settlement agreement.  In so doing, the BAP referred to the Bankruptcy Court's "implicit finding" that Cohen had actual or constructive knowledge of the fee-splitting arrangement, including whether Steinbrecher had complied with California Rule of Professional Conduct 2-200 when he entered into the settlement agreement.  The Bankruptcy Court made no actual findings of fact, and did not hold an evidentiary hearing to determine these critical issues of fact.  Second, the parties presented conflicting evidence to the bankruptcy court as to what Cohen knew at the time of the settlement agreement.  Steinbrecher submitted a declaration that he had discussed the fee-splitting arrangement in detail with Cohen, but Cohen submitted a declaration claiming that he had not been told about it at all and had never even hear of Gilbert's firm.  The bankruptcy court dismissed Cohen's statement as "self-serving," but this, Judge Kleinfeld noted, is not a justification for dismissing evidence.  Had it not been self-serving (i.e., had it not stated that he did know Gilbert and was not told about the fee-splitting), it would have been irrelevant to the matter at hand.  The bankruptcy court should have held an evidentiary hearing and made findings of fact when faced with this contradictory evidence.  There was no "implicit" finding of fact, and could not have been on this record.  Third, Cohen did not immediately challenge the fee-splitting arrangement when he received his first payment from the settlement of the "Borgia" case.  However, the record indicates that he filed a Motion for Accounting, which was denied, showing that he did not accept the payment without cavil.  Cohen further claims that Steinbrecher's declaration of February 7, 2001, refused to disclose the precise nature of the fee-splitting arrangement and that it was only after a subsequent investigation by the counsel for the debtor that Cohen was able to discern precisely what the arrangement was.  Cohen was not estopped from bringing his claim as a result of his initial acceptance of the funds from the first Borgia settlement payment, because he lacked knowledge that would justify an estoppel.  Fourth, the BAP also relied on the release provisions of the settlement agreement, and found that they barred Cohen from bringing this claim.  While the release provisions were written broadly, they expressly reserved Cohen's right to enforce his rights and obligations as awarded by the settlement agreement himself.  The release clause expressly excepts "the express obligations under the express preservation of rights and claims in this Agreement."  Fifth, Cohen's claim before the USCA was that the fee-splitting arrangement between Steinbrecher and Gilbert was illegal, and thus the settlement agreement did not contemplate it when discussing the distribution of "net fees" because of the general rule of statutory construction that contracts are not assumed to contemplate illegal actions if they can be performed lawfully.  In the case at bar, this general rule of construction cannot be overridden without the bankruptcy court first making explicit findings of fact as to whether Cohen knew of the fee-splitting arrangements and whether they were made in violation of Cal. R. Prof. Conduct 2-200.  This matter is one of interpretation of the settlement agreement itself, and thus may be litigated by Cohen to the extent that he seeks to recover those fees which he believes are rightfully his as a result of the contract.  Judge Kleinfeld thought the USCA could not resolve this conflicting record on appeal without the benefit of findings of fact provided by the court below, and without resolving this conflict the USCA cannot say that the bankruptcy court correctly denied Cohen's Motion for Further Enforcement of the Settlement Agreement.  He would just remand the case to the bankruptcy court for an evidentiary hearing and finding of fact.
      Finally, Judge Kleinfeld would reverse the sanctions levied against Cohen, as they were unsupported by any evidence on the record that they were "vexatious" beyond the not-uncommon existence of animosity between the parties.  Cohen's argument in bankruptcy court was not found to be frivolous, and indeed Steinbrecher does not even argue that it was.  The bankruptcy court seems to have relied on the fact that Cohen "profited handsomely" from the actions of Steinbrecher, but it is hard to see how that is sanctionable.  Cohen presented substantive arguments to the effect that he was legally entitled to profit more handsomely than he did.  The court's conclusion that the motion was designed to "harass and retaliate against Steinbrecher" is not supported by the court's finding that the case had a "total lack of foundation."  This is a legal conclusion that does not justify the imposition of sanctions.  Judge Kleinfeld thus would hold that the bankruptcy court abused its discretion in imposing sanctions against Cohen.  Cohen said, basically, that after years of partnership, Steinbrecher left with the biggest case, hired another lawyer to do much of the work, and agreed to a 50-50 split both with Cohen and with the other lawyer.  Steinbrecher says they broke up above board, and this was the deal.  Where they part company is that Cohen said Steinbrecher never told him about the 50-50 split with the other lawyer, and that Cohen would get only half of half the fees, instead of the whole.  Steinbrecher says that he did tell Cohen.  Cohen's position was entirely plausible, because their disagreement involved millions of dollars, they made a written agreement, and it seems odd that Steinbrecher did not make his alleged disclosure in writing.  Far from sanctioning Cohen, the bankruptcy court should have held an evidentiary hearing to find out just what Steinbrecher did or did not disclose to Cohen, and whether Cohen agreed to half of a half instead of half of the whole.

7)  COMMUNICATIONS LAW:  Verizon Northwest, Inc. v. Electric Lightwave, Inc., 00-35743 (9th Cir. April 7, 2003) (unpublished).  Schroeder, Fisher, and Paez, Circuit Judges.
      Verizon Northwest appealed the district court's summary judgment of a decision by the Oregon Public Utilities Commission (OPUC) approving its interconnection agreement with Electric Lightwave pursuant to the Telecommunications Act of 1996.  Verizon challenged the OPUC's imposition of reciprocal compensation on Internet Service Provider (ISP) bound traffic.  Verizon also challenges the reciprocal compensation rate for traffic transported and terminated on Electric Lightwave's network, arguing that under the 1996 Act Electric Lightwave should be compensated at the lower end-office rate, not the higher tandem rate because the functional equivalency test has not been satisfied. 
      Because the terms of the interconnection agreement between Verizon and Electric Lightwave are not contrary to the Act, the USCA affirmed the district court's grant of summary judgment.  Verizon first argued that the OPUC's approval of the inclusion of ISP-bound traffic in the reciprocal compensation provision of an arbitration agreement is contrary to the act and the Federal Communications Commission's implementing regulations.  Specifically, Verizon maintained that:  (1) ISP-bound traffic is not local and therefore not subject to Sec. 251(b)(5)'s reciprocal compensation requirements;  (2) any purported authority to impose reciprocal compensation on non-local traffic is preempted by Sec. 251(b)(5); and, (3), the district court improperly relied on findings made by the arbitrator, but never adopted by the OPUC.  However, the USCA noted that all of these arguments are foreclosed by Pacific Bell v. Pac-West Tele-comm, Inc., 01-17166 (9th Cir. April 7, 2003) [See Published Opinion #9 above.], in which the Circuit held that a state utility commission's approval of the inclusion of ISP-bound traffic in the reciprocal compensation provision of an arbitrated interconnection agreement was not inconsistent with the Act.  As the Pacific Bell panel explained, because the FCC has yet to resolve whether ISP-bound traffic is "local" within the scope of Sec. 251, it is not inconsistent with this provision for the state commission to subject ISP-bound traffic to reciprocal compensation; the court thus rejected the appellant's argument that the state regulatory commission exceeded its statutory authority by imposing reciprocal compensation on ISP calls.  Because neither the FCC nor the Act has foreclosed the inclusion of ISP-bound traffic in the reciprocal compensation provisions of interconnection agreements, there is no conflict with federal law and the OPUC ruling is not preempted by federal law.  Finally, the USCA rejected Verizon's argument that because the OPUC did not adopt the arbitrator's conclusion that ISP-bound traffic is local and therefore subject to Sec. 251(b)(5), the district court erred in relying on the arbitrator's conclusion as the basis for upholding the OPUC's ruling.  Whether the district court erred in this regard does not influence the USCA's de novo review of whether the provision at issue in this case is contrary to the Act.  As it held in Pacific Bell, a state regulatory commission's inclusion of ISP-bound calls in a reciprocal compensation provision is permissible under the act.  The USCA thus affirmed the district court's summary judgment upholding the OPUC's ruling.
       Verizon also argued that the district court erred in affirming the reciprocal compensation rate imposed by the OPUC for traffic transported and terminated on Electric Lightwave's network.  Verizon maintained that it is not obligated to compensate Electric Lightwave at the tandem switch rate because although Electric Lightwave serves a comparable geographic area to the area served by Verizon, its network is not functionally equivalent to Verizon's and therefore it is not eligible for the higher tandem rate.  The basic requirements for setting reciprocal compensation rates are established by the Act.  47 USC Sec. 252(d)(2)(A).  The FCC has promulgated regulations to implement these statutory provisions.  47 CFR Sec. 51.711.  Here the parties dispute the proper interpretation of Sec. 51.711(a)(3) and the FCC's orders implementing that rule.  In the FCC's First Report and Order, 11 FCCR 15, 499 (Aug. 8, 1996), the FCC established guidelines for setting reciprocal compensation rates.  Relying on language in the FCC's First Report and Order with respect to the proper switch rates, Verizon argued that Electric Lightwave was not entitled to charge the tandem switch rate unless its switch served a comparable geographic area to that served by Verizon's switch and was functionally equivalent to Verizon's switch.  Thus, Verizon argued that the OPUC erred by not applying the functional equivalence test in addition to the geographic scope test in deciding whether Electric Lightwave was entitled to charge the tandem switch rate.  Verizon's argument is precluded by the decision in US W. Communications v. Wash. Utils. And Transp. Commn., 255 F.3d 990, 998 (9th Cir. 2001), which held that the functional equivalency test does not apply in determining whether a competitive local exchange carrier (CLEC) is entitled to charge the tandem switch rate.  A CLEC is entitled to the tandem rate if its switch served a comparable geographic area.  The USCA thus affirmed the district court's grant of summary judgment affirming the OPUC's approval of the reciprocal compensation rate for traffic on Electric Lightwave's network.

8)  COMMUNICATIONS LAW:  Verizon Northwest, Inc. v. Electric Lightwave, Inc., 00-35332 (9th Cir. April 7, 2003) (unpublished).  Schroeder, Fisher, and Paez, Circuit Judges.
       Verizon Northwest, an incumbent local exchange carrier (ILEC), appealed from the district court's summary judgment upholding a decision by the Washington Utilities and Transportation Commission (WUTC).  WUTC interpreted and approved Verizon's interconnection agreement (the Agreement) with its competitor WorldCom, a competitive local exchange carrier (CLEC).  The parties negotiated the Agreement pursuant to the Telecommunications Act of 1996.  WUTC also assessed $66,000 in penalties against Verizon because it found that Verizon violated state law by withholding payment under the Agreement.  WorldCom and WUTC challenged the USCA's jurisdiction over the appeal.
      The USCA upheld the district court's summary judgment ruling affirming WUTC's interpretation of the Agreement requiring reciprocal compensation for ISP-bound traffic and requiring Verizon to continue paying reciprocal compensation for local calls beyond the two year expiration date.  However, the USCA conclude that WUTC's decision to impose penalties against Verizon was arbitrary and capricious and thus reversed this part of the of the district court's judgment affirming WUTC's assessment of $66,000 in penalties against Verizon.  First, the USCA rejected the appellees' challenge to its jurisdiction over Verizon's appeal.  After Verizon Maryland, Inc. v. Pub. Serv. Commn., 122 S.Ct. 1752 (2002), the appellees' jurisdictional arguments failed.  As explained in Pacific Bell v. Pac-West Telecomm, Inc., 01-17166 (9th Cir. April 7, 2003) [see Published Decision #9 above] the Supreme Court in Verizon Maryland held that 28 USC Sec. 1331 provides a basis for jurisdiction over an ILEC's claim that a state regulatory commission's order requiring reciprocal compensation for ISP-bound calls is pre-empted by federal law.  The USCA also rejected the two jurisdictional arguments that the appellees claim remain after Verizon Maryland.  However, the USCA noted that Verizon Maryland leaves little room to argue that Sec. 252(e)(6) in any way limits federal court jurisdiction.  Although the court did not directly address the review of state law questions, Verizon Maryland explicitly states that "nothing in the Act displays any intent to withdraw federal jurisdiction under Sec. 1331," and that Sec. 252 "does not distinctively limit the substantive relief available." Id at 1759.  In light of the court's interpretation of Sec. 252, the USCA concluded that its review of state law issues under Sec. 1331 is not precluded.  The USCA also rejected the appellees' arguments that the Hobbs Act, 28 USC Sec. 2343, precluded its review.  Here, as in Pacific Bell, neither side sought to re-adjudicate issues that already have been conclusively determined by the FCC.  At most, they merely ask the court to interpret the FCC's rulings, to the extent that they are final and binding, and to determine whether WUTC's actions here were consistent with federal law.
       The USCA also found that WUTC's construction of the Agreement to require reciprocal compensation for ISP-bound traffic is also controlled by the Pacific Bell analysis and decision.  Pacific Bell held that ISP-bound traffic is not exempt from the negotiated reciprocal compensation provisions of interconnection agreements.  In Pacific Bell, as here, the appellant ILECs (Pacific Bell and Verizon California) argued that the state regulatory commission's interpretation of the reciprocal compensation provisions of their interconnection agreements with CLEAs was contrary to federal law.  Specifically, the ILECs argued that a state regulatory commission's inclusion of ISP-bound traffic in a reciprocal compensation provision was contrary to the FCC's Remand Order, which exempted ISP-bound traffic from reciprocal compensation provisions.  Because the D.C. Circuit explicitly rejected the FCC's attempt to exclude ISP-bound traffic from reciprocal compensation, the USCA concluded that federal law did not preclude the inclusion of ISP-bound traffic in the reciprocal compensation provisions of interconnection agreements.  See Pacific Bell and also WorldCom, Inc. v. FCC, 288 F.3d 429, 430 (D.C. Cir. 2002).  Although Verizon acknowledges that the D.C. Circuit rejected the FCC's attempt to exclude ISP-bound traffic by calling it an "exception" under Sec. 251(g) to the Act's reciprocal compensation requirements, it argues that because the D.C. Circuit did not vacate the portions of the Remand Order establishing a cost-recovery mechanism for ISP-bound calls, the FCC's conclusion that ISP-bound traffic is not subject to reciprocal compensation still stands.  Because the D.C. Circuit explicitly rejected the FCC's analysis exempting ISP-bound calls from reciprocal compensation provisions and preserved only the prospective application of the interim alternative payment scheme for ISP-bound traffic as established in the Remand Order, the USCA rejected Verizon's argument that WUTC's decision to include ISP-bound calls in the compensation agreement was contrary to federal law.  Remand Order, 16 FCCR at 9189.  The USCA also rejected Verizon's argument that WUTC's interpretation of "Local Exchange Traffic" to include ISP-bound traffic is contrary to federal law because longstanding FCC precedent establishes that ISP-bound traffic is not local.  As explained in Pacific Bell, the FCC has yet to resolve whether ISP-bound traffic is "local" within the scope of Sec. 251.  It was thus not inconsistent with this provision and will within WUTC's authority for it to submit ISP-bound traffic to reciprocal compensation.
      Verizon also argued that WUTC erred by interpreting the Agreement to require Verizon to continue paying reciprocal compensation for local calls beyond the two year expiration date.  As a matter of contract interpretation, this issue is controlled by the terms of the Agreement and state contract law.  The USCA agreed with the district court that WUTC's resolution of this issue was not arbitrary and capricious.  Under Washington law, contract interpretation is governed by the "context rule" of the Restatement (Second) of Contracts Secs. 212, 214(c) (1981).  Berg v. Hudesman, 801 P.2d 222, 229-230 (Wash. 1999).  In contrast to the "plain meaning" rule, the "context rule" permits a court to look to extrinsic evidence to discern the meaning or intent of words or terms used by contracting parties, even when the parties' words appear to the court to be clear and unambiguous. Id. at 222.  However, extrinsic evidence is not admissible for the purpose of adding to, modifying, or contradicting the terms of a written contract, in the absence of fraud, accident, or mistake.  Section VIII of the Agreement, titled "TERM," laid out the terms of expiration as well as the terms under which the Agreement could be extended:  "Notwithstanding the foregoing, this Agreement shall, if not superseded by an interconnection agreement, expire two years after the effective date of the Agreement.  In the event that the Agreement expires after two years, the interconnection arrangements in this Agreement shall remain in place until the Parties are able to negotiate and implement a new interconnection agreement.  Negotiations on such a new agreement shall commence no later than 45 days prior to the expiration of this Agreement."  WUTC concluded that WorldCom satisfied the extension provision by initiating negotiations on a new interconnection agreement more than 45 days prior to the expiration date of the Agreement.  Verizon argues that WUTC erred by not interpreting the 45-day deadline to incorporate the statutory procedures for negotiation and arbitration under 47 USC Sec. 252.  According to Verizon, WorldCom's failure to comply with Sec. 252 caused the extension to lapse.  Although Washington law permits WUTC to consider extrinsic evidence even if contracts terms are not ambiguous, it is not admissible for the purpose of adding to, modifying, or contradicting the terms of a written contract.  The Agreement provided that its terms would be extended if, upon expiration, negotiations for a new agreement had commenced at least 45 days prior to that date.  The negotiations having commenced more than 45 days prior to that date.  The negotiations having commenced more than 45 days prior to the date of expiration, WUTC concluded that requiring WorldCom to also comply with the requirement of Sec. 252 in order to avoid a lapse in that extension would have the effect of imposing additional extension terms.  WUTC's interpretation of the Agreement to require only that WorldCom initiate negotiations 45 days prior to the expiration date thus was not arbitrary and capricious. 
      The USCA next rejected Verizon's argument that WUTC erred by interpreting the extension provision of the Agreement to apply to all interconnection arrangements, as opposed to only the physical connection between the parties' networks.  Because Verizon's interpretation would have imposed a one-way obligation on WorldCom to continue terminating ISP-bound traffic originated by Verizon's customers without compensation, WUTC concluded that the term "interconnection arrangements" included all arrangements in the Agreement.  Id.  Although it may be possible that the parties intended to extend only the physical interconnection arrangements beyond the expiration date, it was not arbitrary and capricious for WUTC to interpret the extension provision as applying to all inter-connection arrangement.
       Finally, the USCA concluded that WUTC's decision to assess penalties against Verizon was arbitrary and capricious and thus reversed the district court's summary judgment upholding the penalty.  WUTC imposed penalties against Verizon for "unreasonable conduct" under Secs. 80.04.380 and 80.36.170 of the Washington Revised Code, concluding that it "subjected its competitor, World-Com, to unfair and unreasonable disadvantage."  By refusing to pay for ISP-bound traffic under the Agreement's reciprocal compensation provision because it claimed that the calls were not local but nevertheless billing its customers for this traffic as if the calls were local, Verizon's actions were construed by WUTC and the district court as "trying to have it both ways" and therefore warranting penalties under Washington state law.  The reasons WUTC supplied for the imposition of sanctions here—that Verizon took inconsistent and self-serving positions with respect to the interpretation of the Agreement—do not constitute sufficient grounds for imposing penalties.  It simply does not follow from Verizon's attempt to characterize calls one way for the purpose of interpreting the reciprocal compensation and another way for customers billing that Verizon subjected WorldCom to unfair treatment or even that it was attempting to cut off the fees that WorldCom was due.  WUTC's justification for imposing penalties here does not even meet the standards that it has established for itself for determining when sanctions are appropriate.  Verizon's actions in support of its interpretation of federal law as it related to the Agreement do not merit sanctions under WUTC's own standard.  WUTC's decision to impose sanctions in this case was arbitrary and capricious.  The USCA thus vacated the sanctions imposed by WUTC.

9)  ENVIRONMENTAL LAW:  Weinreich v. EPA, 02-35500 (9th Cir. April 21, 2003) (unpublished).  Rymer, Kleinfeld, and Fisher, Circuit Judges.
      Weinreich appealed pro se the district court's summary judgment in his action under the Administrative Procedure Act, 5 USC Sec. 706, challenging the Environmental Protection Agency's issuance of a Stop, Sale, or Removal Order for production of an unregistered pesticide. 
      The USCA affirmed.  The district court properly determined that the EPA's unopposed motion for summary judgment was supported by the record.  The USCA declined to reach Weinreich's specific contentions regarding errors in summary judgment or in the administrative record because he failed to present them to the district court.  The district court also properly struck Weinreich's motion to void judgment because at the time he filed the motion, the EPA's motion for summary judgment was still pending in this action and the substance of Weinreich's motion referred to the judgment already entered in his related action No 01-5431.  The USCA rejected Weinreich's contention that in striking his motion to void judgment, in No. 01-1710, the district court denied him the opportunity to respond to the EPA's summary judgment motion.  Cf. Fuller v. City of Oakland, 47 F.3d 1522, 1533 (9th Cir. 1995) (stating that a party has an adequate opportunity to respond to summary judgment where there is opportunity to address the issues involved, including adequate time to develop any facts necessary to oppose summary judgment).  Finally, the USCA found that Weinreich's contentions regarding judicial bias lacked merit because they are based on Judge Burgess' prior adverse decisions.  See Liteky v. USA, 510 US 540, 556 (1994) (holding that adverse rulings alone do not establish judicial bias).

10)  EMPLOYMENT DISCRIMINATION / AMERICANS WITH DISABILITIES ACT:  Sanchez v. World Color Press 02-16323 (9th Cir. April 15, 2003) (unpublished).  Rymer, Kleinfeld, and Fisher, Circuit Judges.
       Sanchez appealed pro se the district court's summary judgment in her employment discrimination action under the Americans with Disabilities Act (ADA) and the California Fair Employment and Housing Act. 
       The USCA affirmed in part, vacated in part and remanded.  Because Sanchez failed to raise a genuine issue of material fact as to whether she had an actual or perceived disability within the meaning of the ADA, the USCA affirmed the district court's summary judgment on her claim of discriminatory termination under the ADA. See Thornton v. McClatchy Newspapers, 261 F.3d 789, 798 (9th Cir. 2001) (a plaintiff must present specific evidence about relevant labor markets to defeat summary judgment on a claim of substantial limitation of working; uphold summary judgment where there is no specific evidence that employer regarded employee as substantially limited).  In light of the California Supreme Court's intervening decision in Colmenares v. Braemar Country Club, Inc., 39 Cal. 4th 1019, 1030-31 (Cal. 2003) (the 2001 amendments to the definition of disability merely clarified existing law), the USCA vacated the summary judgment on Sanchez's FEHA claims, and remanded for further proceedings, including consideration of whether to exercise supplemental jurisdiction.  See 28 USC Sec. 1367(a).

11)  ARBITRATION / CONTRACTS:  Pyramid Travel v. Sri Lankan Travel, 01-56014 (9th Cir. April 25, 2003) (unpublished).  B. Fletcher, Alarcon, and Hawkins, Circuit Judges.
       Pyramid Travel argued that the district court erred by reading the arbitration clause in the parties' agreement expansively, resulting in a determination that the libel claims be arbitrated.  The clause is at least as expansive as phrases such as "arising out of or relating to" or "all disputes arising in connection with this Agreement," which are liberally interpreted.  The district court correctly found that the libel action touched matter contained in the agreement and thus was subject to the agreement to arbitrate.  It also correctly held that individual plaintiffs Singh and Mahal were subject to the arbitration agreement because of the nature of their claim, which stated that they were the persona or public face of Pyramid.  Sri Lanka Airlines (SLA) did not waive the right to arbitrate.  It listed as its tenth affirmative defense that Pyramid's claims were subject to arbitration.  This put Pyramid on notice that SLA would attempt to have the claims referred to arbitration.  Pyramid has also failed to show prejudice.  Only 76 days elapsed from the inception of this suit to the filing of the motion to compel arbitration and only 42 days elapsed from the time SLA filed the counterclaim to the time it filed the motion to compel.  This delay was not sufficiently prejudicial to support Pyramid's waiver argument.  The forum-selection clause in the agreement to arbitrate should be honored, and an agreement to arbitrate before a specific tribunal, such as in this case, is equivalent to a forum-selection clause.  Sherk v. Alberto-Culver Co., 417 US 506, 519 (1974).  The Circuit has declared that because arbitration forum-selection clauses in international agreements "offer stability and predictability regardless of the vagaries of local law," they should be given great deference.  The civil war in Sri Lanka was on-going when the plaintiffs signed the agreement.  Moreover, they have availed themselves of the Sri Lanka courts since the 9-11 terrorist attacks.

12)  SMOKING-RELATED HEALTH-CARE COSTS: Forces Action Project, LLC v. California, 02-15336 (9th Cir. April 17, 2003) (unpublished).  Goodwin, Graber, and McKeown, Circuit Judges.
      Forces Action Project, a smokers' rights organization, and individual smokers filed this action against the Attorney General of California and four major cigarette manufacturers.  Plaintiffs seek to invalidate the Master Settlement Agreement (MSA), in which 46 states and several U.S. territories agreed to settle their claims against the cigarette manufacturers for recovery of smoking-related health-car costs.  The plaintiffs sought leave from the district court to file an amended complaint alleging that, through the MSA, the defendants are operating an output cartel and controlling cigarette prices in violation of the Sherman Anti-Trust Act, 15 USC Sec. 1-7.  The district court denied the plaintiffs' motion to amend.
      The USCA affirmed.  The plaintiffs maintained that the district court committed an error of law by relying on undue delay alone as justification for denying their motion to amend.  See Bowles v. Reade, 198 F.3d 752, 758 (9th Cir. 1999) ("Undue delay by itself … is insufficient to justify denying a motion to amend.")  However, the Circuit has held that, even if a district court provides an insufficient explanation for denying a motion to amend, it may affirm if a satisfactory ground for denial is "readily apparent" from the record.  Ascon Properties, Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir. 1989).  The USCA thought it readily apparent from the record that the defendants will suffer prejudice if the plaintiffs are allowed to amend their complaint.  Because dismissal of the entire action would be war-ranted if the plaintiffs had not belatedly sought to allege antitrust violations, the defendants will incur additional litigation expenses if the plaintiffs' amendment is allowed.  See Ascon Properties, 866 F.2d at 1161 (to put the defendants through the time an expense of continued litigation on a new theory, with the possibility of additional discovery, would cause undue prejudice).  The USCA also noted that the plaintiffs presented no new facts, but only new theories, and provided no satisfactory explanation for their failure to develop all theories earlier.

13)  CONSTITUTIONAL LAW / REAL ESTATE SIGNS: THG Enterprises, Inc. v. City of El Cajon, 02-55043 (9th Cir. April 4, 2003) (unpublished).  Lay, Hawkins, and Tallman, Circuit Judges.
      The City of El Cajon appealed the district court's order and judgment that:  (1) the City's ordinance regarding real estate signs placed in the public "parkway" is unconstitutionally vague;  (2) the City's ordinance regarding "community service signs" is an unconstitutional prior restraint on speech;  and (3) the City's ordinance banning temporary political signs is an unconstitutional restriction on speech.  THG Enterprises and Jim Harnsberger (collectively "THG") cross-appealed the district court's determination regarding appropriate attorney's fees.
       The USCA affirmed the district court's decision that the City's Municipal Code Sec. 17.66.020(F)(7) is unconstitutionally vague as applied to signs on public property.  The ordinance's use of the phrase "if an off-site real estate sign is located on private property" implies that an off-site real estate sign could also be on public property.  But the ordinance's restrictive structure and purpose suggest the opposite.  Thus, a person of ordinary intelligence would not reasonably know whether placing an off-site real estate sign on public property is prohibited.  The USCA also affirmed the district court's decision that the City's Municipal Code Sec. 17.66.020(F)(5) is an unconstitutional prior restraint on speech.  Even assuming that the ordinance is content neutral, it does not provide adequate procedural safeguards governing when, where, or how a permit is granted.  See Thomas v. Chicago Park Dist., 534 US 316, 323 (2002).  However, the USCA reversed the district court's decision that the City's Municipal Code Sec. 17.66.020(F)(4) is an unconstitutional restriction on free speech.  The USCA agreed with the district court that the parkway is a limited public forum subject to a "reasonableness" standard of review.  Under that standard, however, the USCA held that the ordinance reasonably promotes the City's aesthetic and safety interests by banning temporary political signs.  Temporary political signs, unlike other signs allowed in the parkway, are unrelated to providing directional or location information to drivers and pedestrians.  Temporary political signs also pose a greater aesthetic risk because of the competition innate in political campaigns.  While the City's regulatory scheme is not precise, the USCA could not say that it is unreasonable either.  Because it reversed the district court in part, the USCA vacated the district court's order granting attorneys' fees to THG and remanded with instructions to recalculate the award.

14)  FORECLOSURE:  Hollis-Arrington v. Cendant Mortgage Corp., 02-56279 (9th Cir. April 17, 2003) (unpublished).  Browning, Rymer, and Kleinfeld, Circuit Judges.  Hollis-Arrington appealed pro se the district court's summary judgment in her action alleging that by denying her request for a forbearance to prevent foreclosure, the defendant breached her mortgage contract and the covenant of good faith and fair dealing, committed fraud, deceit, negligence, and intentionally inflicted emotional distress.  The USCA affirmed.  Summary judgment was proper as Hollis-Arrington failed to show the existence of a genuine issue of material fact on any of her causes of action.  Moreover, the district court did not abuse its discretion by setting aside the clerk's entry of default. See O'Connor v. Nevada, 27 F.3d 357, 364 (9th Cir. 1994) (holding that a determination to set aside default cannot be erroneous if defendant moved fast to set aside the default and had a meritorious defense to the action).  In addition, the district court did not abuse its discretion by denying Hollis-Arrington's motion to recuse the presiding judge.  Finally, the district court properly denied Hollis-Arrington's motion to extend the time for discovery.

15)  IMMIGRATION LAW:  Kho v. INS, 02-70312 (9th Cir. April 9, 2003) (unpublished).  Browning, Pregerson, and Reinhardt, Circuit Judges.
      The Board of Immigration Appeals (BIA) dismissed Kho's appeal from an Immigration Judge (IJ) decision denying his application for asylum and withholding of deportation.  Kho petitioned for review.
      The USCA granted the petition in part and remanded.  First, the IJ found Kho's testimony incredible, but the BIA disagreed, concluding that a negative credibility determination was not supported by the record.  The USCA thus assumed that Kho's factual contentions were true.  Second, under 8 USC Sec. 1158, Kho is eligible for asylum if he is a "refugee," that is, if he is unable or unwilling to return to the Philippines "because of persecution or a well-founded fear of persecution on account of race, religion, nationality, membership in a particular social group, or political opinion."  8 USC Sec. 1101(a)(42)(A).  The USCA held that Kho qualifies for asylum because he has a well-founded fear of future persecution on account of political opinion.  Assuming that Kho risks persecution, the USCA concluded that such persecution would be "on account of" political opinion.  The BIA offered several reasons for concluding otherwise, but substantial evidence did not support the BIA's findings.  The BIA found that the New People's Army (NPA) of the Philippines did not know Kho's political opinions.  However, this conclusion was not supported by substantial evidence.  Kho's conversation with "Fredo," the phone calls Kho received from the NPA threatening him for being a government informant, and the subsequent shooting at Kho's water tank together compel the conclusion that the NPA knew that Kho supported the government.  The BIA wrote that it doubted that the NPA knew Kho was an informer because if they had suspected Kho of being an informer, the NPA "would have shot him instead of his water tank," and because the police report does not offer independent confirmation of the shooting of the water tank.  The first reason must be rejected as pure speculation and conjecture.  The second is relevant only to Kho's supporting documentation, and "an applicant may establish his case through testimony alone." Navas v. INS, 217 F.3d 646, 655.  The BIA also found that the NPA sought to harm Kho for purely economic reasons.  This conclusion was also not supported by substantial evidence.  The phone calls Kho received compelled the conclusion that the NPA's motives were at least in part political.  Moreover, as held in Lim v. INS, 224 F.3d 929, 934 (9th Cir. 2000), and Borja v. INS, 175 F.3d 732, 737 (9th Cir 1999) (en banc), an alien can prove persecution on account of political opinion even where his persecutors were also motivated in part by economic reasons.  Here as in Lim and Borja, the evidence compelled the conclusion that the NPA persecuted Kho in part because of Kho's support for the government.  The BIA distinguished Borja on two grounds:  first, that Kho did not affirmatively voice his opposition to the NPA or his support for the government; and second, that the NPA did not wound Kho.  The first ground is untenable.  Once Kho's testimony concerning the threatening phone calls is credited, it is clear that the NPA knew Kho opposed them as clearly as they knew Borja did.  The second ground is also untenable.  The extent of the persecution Kho suffered, that is, whether or not he suffered physical injury, is irrelevant to the motivation for that persecution.  The BIA also rejected Kho's claim that, as an alternative basis for relief, he had a well-founded fear of future persecution as a member of a particular social group based on his status as a government informer.  The USCA said it need not address this aspect of the BIA's decision, as Kho's status as a government informer may serve as the basis for his claim of a well-founded fear of future persecution based on political opinion. Lim, 224 F.3d at 934;  Briones v. INS, 175 F.3d 727, 728-29 (9th Cir. 1999) (en banc).
        Third, the USCA held that Kho's fear of future persecution was both subjectively genuine and objectively reasonable, and thus "well founded."  The BIA did not doubt that Kho's fear was subjectively genuine.  And while the BIA did find that Kho's fear was not objectively reasonable, substantial evidence did not support that conclusion.  Kho was repeatedly confronted by armed belligerents and repeatedly received vivid death threats.  His property was riddled with gunfire late at night, and he had a gun pressed to his side when he was accosted on his way to work early in the morning. A reasonable factfinder would be compelled by this scenario to conclude that Kho's fear was objectively well-founded.  Lim, 224 F.3d at 935.  Contrary to the BIA's finding, Kho's delays in departing the Philippines did not obviate the objective reasonableness of Kho's fear.  He testified that the NPA continued to threaten his family while he was in Singapore, that the NPA sent him a death threat in the form of a funeral dress upon his return from Singapore, and that Kho and his family left the Philippines as soon after that final death threat as possible.  Clearly, the danger to Kho was not diminishing with times.  A post-threat harmless period need not vanquish an asylum claim, particularly where significant evidence suggests that the threats are becoming more menacing.  Lim, 224 F.3d at 935.  The BIA also addressed the question of changed country conditions.  Relying on the State Department's March 1996 Profile of Asylum Claims & Country Conditions, the BIA noted the percentage of the Philippines in which the NPA was active in 1996, and purported to calculate the percentage of the Philippine population who were members of the NPA in 1996.  The BIA wrote that because those two percentages were so small, it could not conclude that Kho "would face NPA-administered persecution on a country-wide basis" in 2002.  In Lim and Briones the court addressed the Philippines and the same time frame and indeed State Department materials containing assertions nearly identical to those relied upon by the BIA here.  But, Lim concluded that the NPA, "although somewhat weaker than before, remains capable of killing its opponents."  The USCA followed Lim and Briones and held that despite some evidence that might mitigate the probability of persecution, Kho has established a well-founded fear of future persecution on account of political opinion. 
       Fourth, substantial evidence supported the BIA's finding that the threats here did not constitute past persecution, whether on the basis of political opinion, or on the basis of membership in the social group consisting of government informers.  While an alien need not show that a physical injury occurred to make out a claim of persecution, "our court generally treats unfulfilled threats, without more, as within the category of conduct indicative of a danger of future persecution, rather than as past persecution itself."  Lim, 224 F.3d. at 936.
 Finally, an alien is not entitled to mandatory withholding of deportation "unless there is a clear probability (i.e., unless it is more likely than not) that he will be subject to persecution. Lim, 224 F.3d at 938.  The USCA concluded that the mitigating factors cited by the BIA and described above provide substantial evidence to mitigate the risk of persecution in this case to something less than 50%.  Accordingly, the USCA granted Kho's petition for review in part, and affirmed the denial of withholding of deportation, but remanded so that the Attorney General may exercise his discretion under Sec. 208(a) of the Immigration and Nationality Act.

16)  IMMIGRATION LAW:  Shergill v. INS, 01-70778 (9th Cir. April 8, 2003) (unpublished).  McKeown (dissenting) and Paez, Circuit Judges, and Pollak, District Judge.
       Shergill, a native and citizen of India, petitioned for review of the BIA's dismissal of his appeal from the immigration judge's denial of his application for asylum and withholding of deportation, and denial of his motions to remand to the IJ. 
        The USCA granted the petition and remanded to the BIA for further proceedings.   It concluded that the BIA did not establish a sufficient foundation for a negative credibility determination, and hence the BIA erred in determining that Shergill was not eligible for asylum.  Neither Shergill's failure to mention his prior arrests in his asylum application nor his omission at the hearing of the three body searches that he described in his asylum application justify a negative credibility determination.  The "failure to file an application form that was as complete as might be desired cannot, without more, properly serve as the basis for a finding of a lack of credibility." Aguilera-Cota v. INS, 914 F.2d 1375, 138 (9th Cir. 1990).  Inconsistencies must be substantial and go to the heart of the asylum claim in order to form the basis for a negative credibility finding.  The events that were "at the heart of" Shergill's claim to persecution — the severe beating and physical disablement of his brother and the incident in which the village was cordoned off and both brothers' houses searched while they were beaten — were described consistently in both is application and testimony.  In contrast, neither the searches nor his brief, uneventful arrests go to the heart of his claim, and thus his failure to reiterate them in every explanation of his asylum claim does not affect his credibility.  In addition, the discrepancies noted by the BIA with regard to Shergill's views on the necessity of creating an independent Sikh state of Khalistan did not justify a negative credibility determination.  Damaize-Job v. INS, 787 F.2d 1332, 1337, held that discrepancies "that are attributable to the applicant's language problems or typographical errors and cannot be viewed as attempts by the applicant to enhance his claims of persecution have no bearing on credibility."  Mistranslation and miscommunications cannot form the basis for a negative credibility finding.  Shergill's application for asylum reflects the fact that he is not fluent in English, but only Punjabi.  As the transcript of the asylum hearing establishes, he testified through an interpreter.  It is significant that throughout his testimony Shergill consistently and repeatedly declared that he did not advocate for the creation of Khalistan or desire its creation.  Although Shergill's asylum application stated that he "demanded the peaceful creation of an independent Sikh State of Khalistan," in his testimony Shergill explained that on one occasion, while speaking with members of his "gurdwara" about the arrests and mistreatment of his brother and other innocent Sikhs, he had said that if Khalistan were created it would "be better than this."  It is fully consistent for an individual who has been subjected to persecution to believe that "it would be better" if the government did not include his harassers, without having any intention of advocating for their removal.  Shergill's testimony reflects that this is what occurred here.  Shergill's asylum application was prepared by a legal assistant, who apparently failed to appreciate this fine distinction.  This misunderstanding did not enhance Shergill's claims of persecution, nor did it bear upon his fear for his safety;  thus, as in Damaize-Job, it had "no bearing on credibility." 787 F.2d at 1337.  Because the BIA's negative credibility determination is not supported by substantial evidence, the USCA concluded that it must regard Shergill's testimony as credible. Shergill's testimony regarding his objective and subjective fear of persecution on account of political opinion establishes that he is eligible for asylum.  Shergill was arrested, searched, beaten, humiliated, and warned to cease voicing opinions contrary to the government.   His brother was severely beaten by the police numerous times, ultimately causing him to become permanently disabled.  The persecution of both Shergill and his brother occurred for the same reason:  they were politically active in advocating for the rights of Sikhs.  Thus, the pattern of persecution of the petitioner's brother was closely tied to the petitioner.  Arriaga-Barrientos v. INS, 937 F.2d 411, 414 (9th Cir. 1991);  see also Mgoian v. INS, 184 F.3d 1029, 1036 (9th Cir. 1999) (holding that an individual could establish a well founded fear of persecution based solely upon persecution of family members).  The combination of the severe persecution of Shergill's brother and abuse of Shergill constitutes past persecution. Chand v. INS, 222 F.3d 1066 (9th Cir. 2000) (holding that cumulatively, incidents may constitute persecution that individually would not rise to that level).  Shergill established that the persecution that he experienced was motivated by actual and imputed political opinion.  The police arrested the brothers, beat them, and searched their homes because they believed that the brothers supported militants who advocated for the creation of Khalistan through violence.  In addition, the brothers were arrested and beaten for their actual political opinion in support of the boycott against the February 1992 elections.  The USCA thus concluded that Shergill is eligible for asylum, and remanded for the exercise of the Attorney General's discretion.  The USCA also held that Shergill is entitled to withholding of deportation.  Past persecution triggers a presumption that an applicant is entitled to withholding of deportation.  Because the INS does not rebut this presumption, it is more likely than not that Shergill would be subject to persecution upon return to India.  The USCA thus granted him withholding of deportation.
       Judge McKeown dissented.  She noted that that the majority "writes an eloquent brief for why the BIA could have come out differently and, in doing so, reweighs the evidence, parses language, and weaves a plausible story."  However, she noted that the standard of review is not de novo and the court is not asked to determine whether the IJ or the BIA could have reached a different conclusion.  Indeed, they could have.  The question is whether the evidence compelled a different result, that is whether substantial evidence is lacking to support the BIA's determination.  Judge McKeown thought the evidence does not compel the court to reverse the BIA's adverse credibility finding.  To the contrary, the BIA's finding is supported by substantial evidence in the record.  Most notably, there is a conflict in Shergill's testimony with respect to whether he supports the formation of the independent state of Khalistan.  In his asylum application he states that he "demanded the peaceful creation of an independent Sikh State of Khalistan" whereas he claimed at his hearing that he "[did not] want Khalistan."  The majority goes to unusual lengths to explain away this inconsistency, writing it off as attributable to the applicant's language problems, typographical errors, or a legal assistant's failure to "appreciate the fine distinction" between believing that life would be better if an independent state of Khalistan were formed an supporting its formation.  The record, however, contains no evidence of confusion due to a language problem, let alone due to a legal assistant's transcription error.  The BIA credibility determination is also supported by the fact that Shergill failed to mention key evidence during his hearing, namely that he was subjected to three bodily searches, although these searches were discussed in depth in his asylum application.  In addition, Shergill's hearing testimony that he was arrested, detained, and beaten in December of 1991 and February of 1992 contrasts with his asylum application in which he states only that his brother was arrested and beaten during these months.  These inconsistencies are neither minor nor collateral but rather involve the heart of the asylum claim.  Because these inconsistencies could be viewed as at-tempts by the applicant to enhance his claims of persecution, Judge McKeown thought the court cannot conclude, as the majority does, that these inconsistencies have no bearing on credibility.  Although reasonable minds can differ over whether Shergill gave credible testimony, it is not enough to conclude, as the majority appears to do, that a positive credibility finding is supported by the record.  To reverse the BIA's adverse credibility finding, Judge McKeown thought the court must conclude that no reasonable person could have found Shergill not credible and the court should not do so here.  She would sustain the BIA's determination but remand to allow Shergill to file for relief under the convention against torture.