Contents

CRIMINAL LAW:  Federal Sentencing Guidelines—Clarification of Booker and Reduction of Crack Cocaine Sentences

INCOME TAX:  Medical Expense Deduction—Tuition for School for Learning-Disabled Dependent

FAMILY LAW:  Cross-Examination of a Guardian Ad Litem in Custody Proceedings

CIVIL RIGHTS:  Police Brutality

COPYRIGHTS:  Remedies—Copyright Infringement

Recently, the U.S. Supreme Court decided two cases which explain in more detail the mechanics of United States v. Booker, 543 U.S. 220 (2005), holding that the federal Sentencing Guidelines were no longer mandatory, but advisory, although they must still be taken into account at sentencing, along with the other factors set forth in 18 U.S.C. § 3553(a). Booker also instructed appellate courts to review a sentence for reasonableness.

In Gall v. United States, 128 S. Ct. 586 (Dec. 10, 2007), the Supreme Court instructed that the sentencing court should first calculate the applicable Guidelines range. The sentencing court must then give both the government and the defendant an opportunity to argue for whatever sentence they deem appropriate. The sentencing court should then consider all of the § 3553(a) factors to determine whether they support the sentence requested by either party. In so doing, the sentencing court may not presume that the Guidelines range is reasonable. In the event that the sentencing court decides to impose a variance sentence, the court must consider the extent of the deviation and ensure that the justification is sufficiently compelling to support the degree of the variance. A "major departure should be supported by a more significant justification than a minor one." Id. at 597. The appellate court reviews a district court's sentencing determination "under a deferential abuse-of-discretion standard" for reasonableness, regardless of whether the sentence is "inside, just outside, or significantly outside the Guidelines range." Id. at 591.

In Kimbrough v. United States, 128 S. Ct. 558 (Dec. 10, 2007), the Supreme Court held that, like all the other Guidelines, the cocaine Guidelines, which employed a 100-to-1 drug-quantity ratio for determining crack cocaine versus powder cocaine sentences, are advisory only and that a sentence outside the Guidelines range, based on the district court's disagreement with the 100-to-1 ratio, is not per se unreasonable.

In a related development, the U.S. Sentencing Commission recently revised the Sentencing Guidelines' 100-to-1 drug-quantity ratio for crack cocaine versus powder cocaine sentences in U.S.S.G. § 2D1.1(c) by significantly reducing the ratio. See U.S.S.G. § 2D1.1, historical notes. The amendment became effective November 1, 2007 and, on December 11, 2007, was made retroactive by the Commission, effective March 3, 2008.

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Section 213 of the Internal Revenue Code provides that expenses paid during the taxable year, not compensated for by insurance or otherwise, for medical care of the taxpayer and the taxpayer's spouse and dependents are deductible to the extent such expenses exceed 7.5% of adjusted gross income. "Medical care" is defined in § 213(d)(1)(A) as including amounts paid "for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body[.]" While these authorities would appear to limit the medical expense deduction to the physical treatment of diseases and conditions and to the prevention of such, other authority shows that there is some degree of flexibility in making this determination.

Treas. Reg. § 1.213-1(e)(1)(v)(a) provides that ordinary education is not medical care, but that the cost of medical care includes the cost of attending a special school for a mentally or physically handicapped individual if his condition is such that the resources of the institution for alleviating such mental or physical handicap are a principal reason for his presence there.

In Priv. Ltr. Rul. 2007-29-019, 2007 WL 2071034 (July 2007), the IRS was faced with the question of whether the tuition paid for college-age Child A, who had been diagnosed with several developmental disorders, was deductible as a medical expense, where the school receiving the tuition did not provide actual college courses. Rather, the school provided tutoring and specialized social, academic, and independent living skill development to students who were independently enrolled in neighboring colleges and technical schools.

The IRS reviewed prior authority, such as Rev. Rul. 70-285, 1970-1 C.B. 52, in which the term "special school" in the regulations was interpreted as a school having the substantive content of its curriculum devoted to the primary purpose of enabling the student to compensate for or overcome a handicap, with ordinary education limited to an incidental role. The medical deduction for tuition for a child with severe learning difficulties was allowed in Rev. Rul. 78-340, 1978-2 C.B. 124, in which the child's doctor recommended that the child attend the school offering a program designed to allow children with severe learning difficulties to return to regular school.

In the 2007 private letter ruling, the IRS concluded that the school in question qualified as a "special school" because its program was designed primarily to allow Child A to compensate for and overcome her diagnosed medical conditions. It would seem that a doctor's recommendation that the dependent attend the school in question would be a helpful factor in support of the deduction.

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When a guardian ad litem for a child recommends that one parent be awarded sole custody, can the guardian be called as a witness and cross-examined regarding the basis for the recommendation?

In an Oklahoma custody action, the trial court appointed a guardian ad litem to represent a child. The guardian subsequently recommended that the mother be awarded custody. The father desired to cross-examine the guardian concerning the basis for the recommendation, but the trial court entered a standard order preventing the guardian from testifying as a witness. The order was based upon Okla. Stat. Ann. tit. 43, § 107.3(A)(2)(e) (Westlaw 2007), which provides: "[T]he guardian ad litem shall, as much as possible, maintain confidentiality of information related to the case and is not subject to discovery pursuant to the Oklahoma Discovery Code."

The father could not appeal the order before trial, as the case was not yet final. He therefore filed in the Oklahoma Supreme Court a petition for writ of mandamus, seeking to bar enforcement of the order. The order, he claimed, violated his fundamental due process right to cross-examination.

The Oklahoma Supreme Court agreed and granted the requested writ, holding that the statute was unconstitutional as applied. Kelley v. Kelley, 2007 OK 100, 2007 WL 4415260 (not released for publication). The decision was based upon Malone v. Malone, 1979 OK 21, 591 P.2d 296, which held that parents in a custody case had a due process right to cross-examine the investigator who prepared an officially ordered home study. After discussing Malone, the Kelley court continued:

In Malone, it was emphasized that it is fundamentally unfair to receive evidence in a manner that does not advise the parent of its content and provide an opportunity for the information to be tested through cross-examination. Furthermore, the Malone Court made it clear that such procedures amount to private investigations by the court in assembling and receiving evidence, out of the sight and hearing of the parties, who are deprived of the opportunity to defend, rebut, or explain. Due process simply does not exist in such an atmosphere.

The guardian at issue was not testifying as a witness in the mother's favor; in fact, the standard order barred testimony in favor of either parent. Guardians nevertheless serve an important and useful function, and their recommendations are often given substantial weight by trial judges. In effect, the recommendation of the guardian has substantial evidentiary value even if the guardian does not testify. The value, the court suggested, increases the importance of cross-examination:

We do not discount the important role of guardians ad litem in placement proceedings. Such individuals serve as invaluable assets both to the children whose rights they guard and to the trial court which must make difficult decisions on the placement of minors. Nevertheless, without the safeguard of cross-examination, there is no measure to ensure the accuracy of the information provided and the credibility of those who make the statements.

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The interpretation of restraints on law enforcers as to the use of excessive force continues to evolve. It has long been settled that the protections of the Fourth Amendment are triggered as soon as a "seizure" has occurred, that is, when a law enforcer has in some way restrained the liberty of a citizen. See Graham v. Connor, 490 U.S. 386, 395 (1989). It has also long been settled that the protections afforded prisoners are determined under the Eighth Amendment. See Whitley v. Albers, 475 U.S. 312, 319 (1986). Finally, it appears to be settled that the rights of pretrial detainees are determined under the Fourteenth Amendment. See Schall v. Martin, 467 U.S. 253, 256-57 (1984). What has not yet been so clearly established is where the application of the Fourth Amendment ends and that of the Fourteenth begins—that is, at what point an individual's status changes from "seized person" to "pretrial detainee." Identification of this point is critically important in deciding what claims can appropriately be brought.

In a couple of recent cases, the Seventh Circuit has established that point as the time of a judicial determination of probable cause. Williams v. Rodriguez, 2007 WL 4258679, at *8 (7^th Cir. 2007); Lopez v. City of Chicago, 464 F.3d 711, 718-19 (7^th Cir. 2006). A majority of the federal circuits have recognized that Fourth Amendment protections continue "during the course of" an arrest or other seizure, or until the "arrest" or other temporary detention has been completed. See, e.g., Garrett v. Athens-Clarke County, 378 F.3d 1274 (11^th Cir. 2004); Young v. Prince George's County, 355 F.3d 751, 758-59 (4^th Cir. 2004); Fontana v. Haskin, 262 F.3d 871, 879-80 n.5 (9^th Cir. 2001).

A Fourth Amendment analysis would therefore appear to be appropriate—if not required—for all claims of excessive force involving warrantless seizure, for as long as the person remains in the custody of an arresting officer or his surrogate, through the time the person is arraigned, formally charged, or released, all of which time is encompassed within the "course of the arrest or other seizure" and prior to a judicial determination of probable cause. This interpretation is supported by that fact that, in addition to protecting against unreasonable seizures, the Fourth Amendment also affords arrested persons the additional, and distinct, right to a judicial determination of probable cause as a prerequisite to extended restraint following arrest. Gerstein v. Pugh, 420 U.S. 103, 114 (1975).

Thus, the Seventh Circuit's suggestion that a judicial determination of probable cause is the triggering event which distinguishes between Fourth Amendment protection against unreasonable seizure and Fourteenth Amendment protection against pretrial punishment would provide clear guidance in cases of warrantless arrest. Although the point may be more difficult to determine in arrests made upon a warrant, the importance of the distinction is illustrated by the decision in Williams, 2007 WL 4258679, at *8. In that case, the court concluded that the Fourteenth Amendment did not apply because a judicial determination of probable cause had not been made at the time of the alleged excessive force. Given that the Lopez decision had come out nearly two months before the summary judgment decision in Williams, the court also concluded that Williams had waived any Fourth Amendment claim because he had failed to amend or supplement his motion for judgment or to raise the issue on appeal.

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The remedies available for copyright infringement (apart from injunctive relief) are a source of confusion to some practitioners. There are two basic alternatives available to the party aggrieved by infringement under the provisions of the Copyright Act. The aggrieved party may recover either actual damages, 17 U.S.C. § 504(b), or statutory damages, 17 U.S.C. § 504(c). Actual damages include recovery for any injury actually suffered by the aggrieved party plus "any profits of the infringer that are attributable to the infringement and are not taken into account in computing the actual damages." 17 U.S.C. § 504(b). Thus, "[a] copyright owner can sue for his losses or for the infringer's profits, but not for the sum of the two amounts." Bucklew v. Hawkins, Ash, Baptie & Co., 329 F.3d 923, 931 (7^th Cir. 2003). Statutory damages may be assessed in an amount not less than $750 nor more than $30,000 per infringement. 17 U.S.C. § 504(c)(1). If the infringement was entirely innocent, the court may reduce the award to $200 or, if the infringement was willful, increase the award to $150,000. Id. § 504(c)(2).

The recovery of the infringer's profits is not limited to a recovery of direct profits, i.e., those profits that resulted directly from the sale of the infringing work. The aggrieved party may also recover indirect profits, which arise when the alleged infringer does not sell the copyrighted work itself, but rather uses the copyrighted work to sell another product. Masterson Mktg., Inc. v. KSL Recreation Corp., 495 F. Supp. 2d 1044, 1049 n.5 (S.D. Cal. 2007). In either case, however, there must be a showing of a causal connection between the alleged infringement and the award of actual damages sought by the aggrieved party. In some cases, particularly where sales of infringing software are involved, one measure of the aggrieved party's actual damages is the reasonable license fee that could have been imposed by the copyright holder on the infringer. In that circumstance, it is immaterial that some or all of the infringing copies were not sold, since the license fee could have been charged irrespective of any actual sales. Thoroughbred Software Int'l, Inc. v. Dice Corp., 488 F.3d 352, 359 (6^th Cir. 2007).

An issue on which the courts are split is whether the party prevailing in a copyright infringement case may recover common-law punitive damages. Perhaps the prevailing view is that the recovery of punitive damages is foreclosed by the option of a recovery of statutory damages. See Blair v. World Tropics Prods., Inc., 502 F. Supp. 2d 828, 838 (W.D. Ark. 2007); Budget Cinema, Inc. v. Watertower Assocs., 81 F.3d 729, 733 (7^th Cir. 1996). A few courts have concluded otherwise. See Blanch v. Koons, 329 F. Supp. 2d 568, 569 (S.D.N.Y. 2004) ("Conventional authority holds that punitive damages are unavailable in copyright infringement actions, regardless of whether plaintiff is seeking statutory damages or the alternative of actual damages plus profits. . . . However, two recent decisions in this district suggest that the copyright statute logically permits punitive damages in cases when the plaintiff seeks actual damages and profits, rather than statutory damages, for willful or malicious infringement."). A finding of willful infringement entitles the prevailing party to an augmented statutory recovery, so in most cases punitive damages will not be available, or even advantageous, from the prevailing party's point of view.

An important consideration in evaluating a claim of infringement is that a prevailing plaintiff in a copyright infringement case is routinely awarded attorney's fees. See Positive Black Talk, Inc. v. Cash Money Records, Inc., 394 F.3d 357, 380 (5^th Cir. 2004) (awarding attorney's fees to the prevailing party in a copyright action "is the rule rather than the exception and [they] should be awarded routinely"); Thoroughbred Software Int'l, 488 F.3d at 362 (same). Litigating a copyright infringement claim can be very costly (often requiring extensive discovery and the testimony of expert witnesses). Counsel advising those accused of infringement, especially those who have been served with a cease-and-desist letter, should be mindful of the adverse financial consequences of litigating an infringement claim, not to mention an ultimate finding of infringement. That is not to say that every accusation of infringement should be conceded, but it is fair to say that accusations of infringement, particularly if made by a prospective plaintiff known to be vigilant in enforcing its intellectual property, should be taken seriously and evaluated carefully. The law affecting claims of copyright infringement is complex, so research into the legal basis of claims and potential defenses should be examined in depth.

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