The Third Circuit has rightly thrown out the $550,000 fine against CBS for the Janet Jackson “costume malfunction” lasting 9/16^th of a second during the 2004 Super Bowl Halftime show. The Court concluded that the FCC's actions in imposing a fine for a fleeting incident were arbitrary and capricious. In its Opinion, authored by Judge Sirica, the Court made it clear that the FCC under the Bush Administration was far more out of line and out of touch than Justin Timberlake and his costar.

          The FCC had relied on a single sentence in a 2001 policy statement to justify the single, isolated event as an “indecent standard.” The FCC had written: "even relatively fleeting references may be found indecent where other factors contribute to a finding of patent offensiveness.” Judge Sirica found that the term "relatively fleeting" is not the same as one isolated incident to trigger indecency fines, adding: "While an agency’s interpretation of its own precedent is entitled to deference,” . . . deference is inappropriate where the agency’s proffered interpretation is capricious. Until its Golden Globes decision in March of 2004, the FCC’s policy was to exempt fleeting or isolated material from the scope of actionable indecency. Because CBS broadcasted the Halftime Show prior to [the introduction of the fleeting expletive standard] this was the policy in effect when the incident with Jackson and Timberlake occurred."

The Court also refused to hold CBS liable for the independent actions of the performers. The FCC had argued that CBS was vicariously liable under the doctrine of respondeat superior,. The Court would have none of it, holding: "CBS’s actual control over the Halftime Show performances did not extend to all aspects of the performers’ work. The performers, not CBS, provided their own choreography and retained substantial latitude to develop the visual performances that would accompany their songs. . . . [and] but the performers retained discretion to make those choices in the first instance. .  "

Alan Milstein

In a startling reversal of his own ruling, Chief Judge David Hamilton of the Southern District of Indiana issued a 28 page Opinion reversing his preemption ruling in an

The Judge rightly concluded that "drug manufacturers
have the authority to strengthen warnings without the advance permission of
the FDA"  and that “failure to warn litigation can serve to reinforce the FDA's
regulations, which already place the obligation to strengthen the warnings
on a drug's label squarely on the shoulders of the drug's manufacturer."
          The Judge relied in part on a recent law review article by former FDA Commissioner, David Kessler, in which he noted the recent change in position by the FDA under the watch of a Chief counsel with significant ties to BigPharma. Mr. Kessler wrote: "The most fundamental problem is that drugs are approved on the basis of
clinical testing that cannot, and is not designed to, uncover risks that are
relatively rare or have long latency periods. Legislation cannot solve this
problem ... Top-down surveillance is no substitute for failure to warn
litigation, which provides the FDA, doctors, and patients with information
about new risks that is otherwise unavailable to the agency."
              The Indiana case involved a 55 year-old Catholic priest with no history of suicidal ideation who took his life 22 days after being put on Paxil.

Alan Milstein

The connection between Mirapex and compulsive gambling first came to light in July 2005 when doctors at the Mayo Clinic reported the results of a study suggesting a link between dopamine agonist drugs like Mirapex and compulsive gambling.

Researchers have long known that certain drugs can cause adverse reactions that can change a person's behavior by initiating destructive thoughts which lead to destructive behavior. It will be interesting to see if a court and jury will accept the theory that a prescription drug is responsible for behavior such as a gambling addiction.

Alan Milstein

The United States Court of Appeals for the Ninth Circuit affirmed the conviction of an individual concluding and affirming the conclusion that documents the individual presented to the Internal Revenue Service were unlawful fictitious financial instruments.

In these economic times as reported and made a reality by our media, there is typically an onslaught of economic crime perpetrated by individuals desperate to escape their personal economic turmoil. Apparently, this taxpayer on two separate occasions submitted a document he titled a “sight draft” and a tax payment voucher for the amount of the draft to the IRS.   A sight draft is a valid instrument used in international trade. The document looks like a check, often requires no signature and is payable upon demand or presentment, hence the “on sight”.

The sight draft fraud is common amongst tax protestors and particularly tax protestor “redemptionists”.  You will like this one.  Redemptionists believe that the national debt is collateralized pro rata by each individual’s birth certificate and that each person has a mirror entity, a straw man, that represents the amount of work you do.  Redemptionists say there is a way to redeem your straw man and stake your claim to the debt.  As it goes, all you need to do is file your birth certificate along with the sight draft and you have redeemed your straw man and, I guess, released your collateralization of the national debt.  Thereafter you control your straw man and you can use the money from the sight draft to pay your mortgage or taxes.  Don’t try this at home.

Here is the Opinion of the Court of Arbitration for Sport upholding the decision to disqualify Floyd Landis and strip him of his Tour de France Title. The panel concedes that the initial testing by the French which found traces of synthetic testosterone in Landis’s urine was seriously flawed and departed from the standards by which such tests are governed. Still, three arbitrators found against Landis who had reportedly spent 4 million dollars fighting for his vindication. The panel also ordered Landis to pay $100,000 in legal fees and costs because it said the defense team raised “barely arguable” issues of bias and fraud. In fact, Landis had presented credible evidence that the lab personnel failed to maintain the proper chain of custody of his samples under questionable motives.

          The hearings were held behind closed doors despite the attempts by Landis and others to hold them where the media and the public could attend.

          Landis, whose endurance has always served him well, responded: "They will never get to the end of how much I can take. I'm not happy that I'm the person who has to take this, but I would never allow myself to be treated this way and ever give up."

Alan Milstein

Alan Milstein

Alan Milstein

Alan Milstein

 Anne Hathaway, The "Get Smart" actress ended her relationship with her boyfriend of four years, Raffaello Follieri last week amid reports that his charity was being probed by the New York Attorney General’s Office.

Yesterday, Follieri was indicted by prosecutors who claim he duped investors in his venture to buy Catholic Church properties in the United States by suggesting he had top Vatican contacts who could help him do business, going so far as to hire two monsignors to travel with him on deal-making trips. Those monsignors purportedly accepted monies in exchange for representing that they were higher Church officials in an effort to bolster Follieri’s fraud. Follieri is charged with multiple counts of fraud and money laundering.

One such fraud involved Follieri using his investors' money to fund an extravagant lifestyle with Hathaway. His “investor” was Ron Burkle, the supermarket magnate and modern day “RatPack” buddy to former President Clinton. Burkle had pursued a civil suit against Follieri earlier this year and recovered about $1.2M, but lost far more. Another investor, Canadian real-estate exec Michael Cooper, also reportedly gave millions to Follieri. Amongst his extravagances were an apartment in Trump Tower in Manhattan, designer and custom clothing and jewels, dentistry for his father (a convicted con-man) and gifts.

Newspaper accounts report that in recent months, Follieri repeatedly "stalled" on paying waiters and bartenders he hired for frequent celebrity-studded parties he threw with Hathaway at another luxurious apartment he rented in the Olympic Towers on Fifth Avenue. It was noted that at those parties, the two monsignors were constant guests.

The New York Archdiocese said they rejected Follieri property purchases because he made lowball offers. Other dioceses said he appeared suspicious to them or failed to follow through on promises in other cases. Follieri is accused of swindling up to $6 million and failed to post the $21 million bail. When arrested, Follieri had a ticket for a flight to Italy and planned to travel to Capri.

John M. Hanamirian

Here is an interesting article about Sonny Vaccaro’s attempts, among other things, to end the one and done rule hatched by the NCAA and  the NBA.

Alan Milstein 

As hundreds of gay couples headed to California to take advantage of  a state declared right to be lawfully wedded, its impact could be felt in a rather unusual forum. The self-confessed mastermind of  the September 11th attacks appeared before a military tribunal last week and asked to be given the death penalty so he could become a “martyr.” Khalid Sheikh Mohammed told Col Ralph Kohlmann, a US military judge, that death was "my wish . . . I am looking to be martyred for a long time. I fought against the Russians [in Afghanistan] for a long time. Now it is maybe from you."

The Pakistan-born Kuwaiti also sang verses from the Koran, denounced the court at the US naval base in Guantanamo Bay, Cuba, as an inquisition and said he would represent himself.

"I will not accept any lawyer if they swear allegiance to the American constitution,” he said.  Why is he so opposed to the Constitution? For this, he had an answer that should sit rather uncomfortably at places like Fox News and the Family Research Council. “I am considering the American constitution evil laws in allowing for same sex marriage and many things that are very bad," he said.

If he thinks it’s bad you know its good.

Alan Milstein

A Florida prison psychologist was sentenced to five years in prison for his role in an inmate personal income tax fraud scheme. In the alleged scheme, the psychologist accessed the Florida Department of Corrections database and obtained the names and other identifying information about other inmates in other prisons. The psychologist then gave that information to the inmates in his own prison and then those prisoners allegedly used that information to prepare and file false federal income tax returns claiming refunds. The total take: $902,000.00.

The IRS, in rapid response, announced a new cooperative effort to combat prison-based tax fraud:

“The prosecution of income tax refund crimes committed by prison inmates is important. …Participants in prison refund scams commit crimes against the nation’s tax systems.”

I am usually a proponent of  expansion of individual rights, but maybe prisoner’s tax returns get codes and any refund claims are picked up for at least a preliminary review at the Service Center where they are processed?

John M. Hanamirian

Alan Milstein

Alan Milstein