Merry Christmas to our friends and clients!

What is a "grand jury" anyway?

What is a Grand Jury, anyway?

            With the recent developments in the tragic stories of Michael Brown in Ferguson, Missouri and Eric Garner in Staten Island, New York, the phrase “grand jury” has been used frequently, and misunderstood just as frequently, by many people.  So what is a “grand jury” anyway?

Is it the same as a regular “jury?”

            No!  A “jury” is impaneled to hear evidence at a trial.  Both the State and the Defense have a say in who sits on a jury.  At the trial, strict rules of evidence apply, both the State and the Defense are allowed to call witnesses, introduce tangible evidence (think: items related to the alleged crime) and make arguments.  The whole proceeding is open to the public, and is presided over by a judge.

So what is a grand jury?

            Grand juries are a vestige of the English system of government, and are intended to act as a check against the power of the executive (or the king) to bring a citizen to trial.  The role of the modern grand jury is to determine whether the State has probable cause to charge a person (or corporate entity) with a crime.  If the grand jury says “yes,” an indictment is issued, and formal criminal proceedings commence.  If the grand jury says “no,” there are no immediate criminal charges.

So how does a grand jury work?

            Grand juries function very differently than “regular juries.”  I will highlight the biggest differences:

• Grand juries hear multiple cases per day, and can be impaneled for several months (federal grand juries can sit for up to 18 months, while grand juries in Maryland can sit between 3-12 months).
• Grand jury proceedings are supposed to be secret.  Secrecy is intended to (1) reduce the risk that the defendant will flee; (2) reduce tampering with the grand jury; (3) permits witnesses to testify before the grand jury without fear; (4) encourages those with evidence to cooperate with prosecutors and police; and (5) exonerates those who are ultimately not indicted.  See, U.S. v. Proctor & Gamble, 356 U.S. 677 (1958).
• The prosecutor may present any evidence (including evidence that would be inadmissible at trial : hearsay, illegally obtained evidence, etc.).  The prosecutor may also express his/her own opinion and explain the law directly to the grand jurors.  The prosecutor may withhold exculpatory evidence (evidence that tends to show that the defendant is innocent) from the grand jury.
• The grand jury may conduct their own investigation – they are not limited to the evidence presented by the prosecutor.
• The defendant has no right to be present, or testify – but if the defendant does appear/testify, he/she has no right to counsel.
• The defendant has no right to cross-examine witnesses, or challenge evidence presented by the prosecutor.
• If the grand jury decides not to issue an indictment, the prosecutor may impanel a new grand jury and try again.

What happens when an indictment is issued?

            This issuance of an indictment marks the beginning of formal criminal proceedings.  The indictment will issue with a summons/warrant.  Once the defendant is served/arrested, the pre-trial process begins.

If you are involved with a grand jury, either as a witness or defendant, or have otherwise been charged with a crime, call Young & Valkenet immediately for a free consultation (410) 323-0900.

Joint account funds can be stolen by a joint owner, and jail time awaits!

The Maryland Court of Special Appeals finally given a clear opinion on whether one joint owner of a bank account can be found guilty of criminal theft from the other joint owner by withdrawing funds from that same account. The answer is "yes," and jail time awaits those who commit the crime.

On October 31, 2014, the appellate court decided Wagner v. State, a case where the daughter of an 84 year old man was sentenced to eight years in prison (with all but 18 months suspended) for drawing over $122,000 out of jointly owned bank accounts. The case speaks to any family where children are added to accounts by elderly parents, and it speaks loudest to those families where children take advantage of their elderly parents by using the money for their own purposes.

Mr. Wagner, 84 years old, simply wanted a family member to help manage his accounts, and to have access to an ATM. Like many older folks, he trusted his kids, and so Mr. Wagner added one of his adult daughters to his bank account (and IRA). Similarly, the daughter added Mr. Wagner to her accounts.

Up to this point, the story is very common, and the actions are well intentioned. We routinely field questions from children who seek to control their parents access to money in joint accounts to 1) preserve an anticipated inheritance, or 2) to keep Dad from lavishing gifts on another woman, or 3) to pay the child's personal expenses.  In the best cases, we can persuade and counsel that the money belongs to the elderly parent, and absent court ordered guardianship, the parent is free to spend the money as he sees fit-- even on fast cars (or scooters?) and a reckless social life.

But Mr. Wagner's daughter drew money out of joint accounts solely for her benefit, and to support a failing business. And for that, she was convicted and sent to prison.

The case is important because it explains how banking rules on joint ownership are to be balanced with real life relationships.  It remains appropriate for an elderly parent to name a relative as an authorized person on the bank account. And it allows the elderly parent to later demonstrate that joint naming of the account does not necessarily imply joint ownership of the funds in that account.

It was Mr. Wagner's testimony that sent his daughter to jail.

Joint naming of bank accounts will always be a useful tool for helping mom and dad manage their money--just remember that it is always their money, and not yours!

Merry Christmas, and be safe!

The War on your Constitution.

The Baltimore Sun reports that prosecutors are choosing to remove evidence from criminal trials rather than permit cops from disclosing how they track cell phones:

City police Det. John L. Haley, a member of a specialized phone tracking unit, said officers did not use the controversial device known as a stingray. But when pressed on how phones are tracked, he cited what he called a "nondisclosure agreement" with the FBI.

"You don't have a nondisclosure agreement with the court," Baltimore Circuit Judge Barry G. Williams replied. Williams threatened to hold Haley in contempt if he did not respond. Prosecutors decided to withdraw the evidence instead.

What is a "stingray?"  The ACLU provides this definition:

Stingrays, also known as "cell site simulators" or "IMSI catchers," are invasive cell phone surveillance devices that mimic cell phone towers and send out signals to trick cell phones in the area into transmitting their locations and identifying information. When used to track a suspect's cell phone, they also gather information about the phones of countless bystanders who happen to be nearby.

Traveling?  Take a look this interactive map showing those states where law enforcement is using the stingray, and know that your phone data is very much at risk of interception without your knowledge.

The device is expensive- Baltimore City spent $133,000 to purchase one in 2009- so you better believe it is used. But subterfuge about how they may be undermining the civil rights of non-suspects remains a matter of concern in court. Prosecutors would rather dump evidence than permit officers to respond truthfully to questions:

In court Monday, the robbery detective who prepared the warrant to search Taylor's home testified that members of the department's Advanced Technical Team did a "ride-by" — described in court papers as "sophisticated technical equipment" — to determine one of the phones was inside the home. Detective Alan Savage said he did not know what technology or techniques the unit employs.

The defense then called Haley to the stand. He said police can use data from the cellphone companies to locate phones in real time.

Insley asked Haley whether police can ascertain a phone's location "independently," without the help of a phone company. Haley said yes.

When asked how, he balked.

"I wouldn't be able to get into that," Haley said.

Insley tried again later. Haley responded that police can get GPS location data from phone companies.

"Then there's equipment we would use that I'm not going to discuss that would aid us in that investigation," Haley said.

Williams, the judge, instructed Haley to answer the question. Haley invoked the nondisclosure agreement.

"I can't. I'm sorry. I can't," Haley said.

Williams called Insley's question "appropriate," and threatened to hold Haley in contempt if he did not answer.

Haley demurred again, and Assistant State's Attorney Patrick R. Seidel conferred with other prosecutors in court to observe the hearing.

Finally, Seidel said prosecutors would drop all evidence found during the search of the home — including, authorities have said, a .45-caliber handgun and the cellphone. The prosecutor said the state would continue to pursue the charges.

 Who else uses this secret technology? The ACLU has collected various items that identify the federal agencies for us. They include the FBI, the DEA, the U.S. Secret Service, Immigration and Customs Enforcement, the U.S. Marshals Service, the Bureau of Alcohol Tobacco and Firearms, the U.S. Army, U.S. Navy, U.S. Marine Corps, U.S. National Guard, U.S. Special Operations Command,  and the NSA.

The more robust patriots among us proudly declare that this technology is needed to target terror suspects and other enemy combatants. But use continues to spread, right here at home:

Police and prosecutors in another case ran into a similar problem in September, when they were asked to reveal how a cellphone was tracked.

Sgt. Scott Danielczyk, another member of the Advanced Technical Team, testified in that home invasion case — also before Judge Williams — that police used data from a court order to track a cellphone to the general area of the 1400 block of E. Fayette St.

Danielczyk and three other members of the unit were tasked to "facilitate finding it," he testified, and determined the phone was in the possession of someone on a bus.

Williams asked how Danielczyk concluded the phone was being carried by the suspect.

"Um, we had information that he had the property on him," the officer said.

Williams pressed.

"This kind of goes into Homeland Security issues, your honor," Danielczyk said.

"If it goes into Homeland Security issues, then the phone doesn't come in," Williams said. "I mean, this is simple. You can't just stop someone and not give me a reason."

In that case, too, the phone evidence is no longer in play. Prosecutors are proceeding without it.

This is real life, and not Season 6 of The Wire. The use of phone wire tap technology in the HBO series was characterized by creator David Simon as  metaphor. Like police digging into the secret world of Baltimore's fictional drug culture, the viewer was invited to share in that secret view. In fact the show often presented images as if the viewer were looking through cameras or listening in on phone calls.

But what is unfolding in our City courts is not metaphor. The police  and prosecutors sworn to protect and uphold the Constitution of the United States are gathering information on you and me without obtaining Constitutionally mandated permission. And to hide this fact from public scrutiny, they choose to cripple their own prosecutions by withdrawing evidence.

Be afraid, be very afraid.

Postscript 12/11/2014- Our friend Tom Donnelly argued successfully before the Maryland Court of Appeals that expert testimony is required in connection with identifying cell phone tower locations and transmissions in criminal cases. Well done, Tom!

Post by The Law Offices of Thomas M. Donnelly, LLC.

It's All Hallow's Eve! But court shouldn't be scary!

Baltimore Circuit Judge suspended for being rude.

On October 21, 2014 the Daily Record reported the five day suspension of Baltimore City Circuit Judge Lynn Stewart Mays. As the article describes, she was sanctioned for a lack of decorum in her courtroom:

At a post-conviction hearing in the second case,  Mays told defense attorney Rachel Kamins on Jan. 23, 2013, to stop arguing “with the court because you’re going to lose. I don’t care if I’m right, wrong, indifferent. I could be speaking Swahili, you’re going to lose. You know why? One, I’m the judge, Two, I’m the judge. Three, I’m the judge,” the commission stated.

All of us who appear regularly in court must joust with some judge that is having an off day. We don't know whether their dog died, or if they just missed a second cup of coffee.  We just deal with it.

What is missing from this reported exchange is whether counsel and the bench already had a lengthy exchange of the law and facts, and whether counsel was simply pushing beyond reasonable argument.

And when the judge is wrong, we appeal.

But decorum is generally defined as the "dignified propriety of bahvior, speech, dress, etc." As lawyers, we dress formally, we call the judge "your Honor," And we don't shout or interrupt opposing counsel or the Court. This is the expected conduct to aid highly controversial and emotional matters to be resolved in an orderly fashion. The Maryland State Bar Association publishes a code of conduct for lawyers on this very subject.

The reciprocal obligation is visited on the judiciary to 

...be courteous, respectful and civil to lawyers, parties, witnesses, and court personnel. We will mainntain control of all court proceedings, recognizing that judges have both he obligation and the authority to ensure that judicial proceedings are conducted with dignity, decorum and courtesy to all.  

All of us who appear regularly in court must joust with some judge that is having an off day. We don't know whether their dog died, or if they just missed a second cup of coffee.  We just deal with it.

Some judges allow themselves to be baited into bad behavior, like the judge who awarded 300 days of jail to a verbally combative defendant. In the most extreme case, one judge pursued a lawyer into the hallway and punched him.

What is missing from the reported exchange between Judge Mays and Ms. Kamins is whether counsel and the bench already had a lengthy exchange of the law and facts, and whether counsel was simply pushing beyond reasonable argument.

And when the judge is wrong, we appeal. But when the judge is rude or disrespectful to our cause or client, we often must stand in respectful silence. To do otherwise breaches counsel's own obligation to maintain decorum.

Within the broad spectrum of bad judicial behavior, this falls on the bland side of the scale. I am sure Ms. Kamins was not much bothered as anyone regularly appearing in the Circuit Courts develops a thick skin. But may all members of the judiciary and Bar continue to work harmoniously to move our clients' matters through the system without unnecessary acrimony, and with just a bit of decorum.

How to beat a bank for a quarter million bucks.

Maryland’s law of equitable subrogation is fairly settled.  Where a lender has advanced money for the purpose of discharging a prior lien, and the disbursement is in reliance upon the lender receiving a security equivalent to the discharged lien (payoff of a first lien to obtain first lien position), without actual knowledge of the junior lien then the new lender is deemed subrogated to the prior lien. Decisions by our appellate courts now add nuance to this rule based on a limitless supply of neglectful or honestly mistaken loan transactions.

 On October 9, 2014 Maryland’s Court of Special Appeals decided National Institutes of Health Federal Credit Union v. BAC Home LoansServicing, LP (Sept. Term, 2011, No. 2103). This unreported decision addressed the relative lien priority of a Home Equity Loan (known as an “HELOC”) when compared to a later recorded refinance deed of trust. For Maryland lenders and title folks, the decision applies well known equitable subrogation law to a slightly re-ordered timeline of events. For those not familiar with equitable subrogation it is an excellent primer.

An HELOC loan is most commonly an open ended line of credit secured to real property.  The recorded lien instrument will describe a maximum amount, and will also commonly include a statement that the credit line must remain open unless and until the borrower signs a formal request to close the account. The lien is released only after the credit line is closed. And so, in a Maryland real estate settlement involving payoff of an HELOC, the payoff must be accompanied by the borrower’s request to close out the account.  And if the settlement officer fails to obtain authorization to close the account, the borrower is free to run the HELOC back to its maximum limit even after the refinance. The risk to the refinance is obvious-- the new HELOC balance will prime the refinance deed of trust.

In our title insurance practice, we have experienced home sellers who drew on their unreleased HELOC to gamble in Atlantic City or invested in failing business concerns, leaving the new owners, their title insurers and lenders to sort through the wreckage.

In this case, the borrower took a $1 Million Dollar loan from BAC to refinance a prior $800,000 purchase money loan, and a HELOC. But in a twist not seen in prior cases, the refinance deed of trust was immediately. The HELOC, however, had been funded one year earlier but was not recorded in the land records until one month AFTER the refinance deed of trust.  Predictably, after the refinance the borrower ran the HELOC right back to its limit to bolster his failing business interests.  And just as predictably, the borrower defaulted on all his loans and drifted into bankruptcy.  The court case grew from the refinance lender’s attempt to foreclose, and the HELOC lender’s attempt to establish priority. The HELOC lender lost at trial before the Circuit Court.

It was very important to the intermediate appellate court that the HELOC lien instrument was not yet recorded at the time of the refinance loan. The refinance lender received the borrower’s application, which disclosed the existence of a line of credit, but a title search confirmed there was no recording in the land records---the search showed what is commonly called “clear title.”

It was also very important to the appellate court that the HELOC lender used a standard payoff statement that made reference to a “release fee” to be submitted with the payoff. And since the title report showed no recorded lien, the refinance lender did not include a lien release fee with the payoff disbursement for the full amount listed in the payoff statement.

The evidence was that the HELOC lender did not communicate a single thing to the refinance lender to suggest a secured lien.  After the refinance lender’s best efforts, it could only reasonably conclude that the payoff was going toward an unsecured debt. And it was on this basis that the trial court was affirmed. 

The HELOC lender thus took nothing from the foreclosure sale, and was effectively wiped out by a sale price that covered only the first secured lien of the refinance lender. The failure to record timely cost this HELOC lender over $250,000.

Equitable subrogation is a powerful tool, as demonstrated in this decision, but we have seen instances where trial courts dig deep into a refinance lender's files to impute "actual knowledge" of the unrecorded or late recorded interest of another lender. For example, in one recent trial, the court looked to a prior loan file for the same borrower that contained a credit report making reference to the other lender's "mortgage loan." Even though the refinance loan described in the file did not close, and it was one year before the refinance loan at issue, the court ruled that possession of this information in the refinance lenders business records was enough to impute "actual knowledge" to the entire corporation. The case settled quickly, so we do not know what the court of special appeals would have done on that set of facts.

So, get yourself some equitable subrogation--it's better than a gun.

Want a jury? Don't just check off the box!

You may want to avoid jury duty, but if you are a plaintiff or defendant in a civil lawsuit, you may want a jury. It is a powerful thing to have six members of your community make decisions about your legal rights, and whether large amounts of money must be passed between you and the other side.

This week, Maryland's Court of Special Appeals had to issue an opinion on something that should be quite simple-- how to properly demand a jury trial in civil cases.

In Lisy Corporation v. McCormick, issued October 7, 2014, the court wrote that merely checking off the "jury trial" box on the civil information cover sheet (a pre-printed form that must accompany every newly filed complaint) is not enough.  Without a clear statement in the body of the complaint, such as "the Plaintiff demands a jury," the check in the pre-printed box will not preserve your right to a jury trial.

It's a simple, simple detail of drafting and filing complaints. But even the best of us can use the reminder.

Electronic recording is coming to Baltimore County, Maryland.

Maybe.  Well, most likely.

The Request for Proposal issued by Baltimore County describes the project this way:

SCOPE: Deeds, deeds of trust, mortgages and releases will be the first documents to be accepted (approximately 700,000 per year); others will be added over time based on complexity and volume.

The system requires a customized workflow to mimic the existing paper workflow. When Title Companies, Bankers and Lenders create Land Record paperwork to document a purchase, sale, transfer, mortgage, loan or release, information to create the paperwork is researched using several on-line sources, including SDAT for tax information and ELROI and MDlandrec for title searches.

The “package” is approved by the industry parties and the journey to public recordation begins. Documents must be presented to the county Finance Office for clearance that outstanding debt is satisfied before the transaction can be recorded. Once approved, the document travels to the local Courthouse and is presented along with funding to the Clerk of the Court to be reviewed and filed as permanent record. Once accepted by recording staff, the document is processed using the ELROI system, which includes scanning, indexing and verification of each document. Once verified by staff, document images are sent to the Maryland State Archives for permanent preservation and public access; SDAT receives newly filed documents with which to update their systems.

The selection, customization and implementation of an eRecording system will be generally based on seamless integration and easy conformance with existing system and procedures, which are many. The Contractor will work with the existing contractors and related agencies as needed.

The system will accept specific document types and emulate the current paper workflow.

APPROACH: Based on research and interviews, our approach is to duplicate the paper process and use technology to enhance and strengthen process integrity and data.

Legal professionals are currently being polled to share opinions on the project.  I've excerpted some of the opinions that are flying around the local listserves, below. Many lawyers and title company professionals welcome e-filing, citing to the majority of jurisdictions that accept title documents that are filed electronically:

The trend nationally is towards Electronic Recording.  Presently there are approximately 1184 Counties accepting E Recordings nationally.  That number will grow.  At the moment, you can E Record in all of DE; 28 Counties in PA; 15 Counties in VA and 18 Counties in NJ...only 5 other states, other than MD, ....do not offer any E Recording: KY, RI, SD, VT and WV.

The elders of our profession embrace the new technology because it is inevitable:

 I've been doing this for 31 years and often been called an old curmudgeon for the way I insist things be done (the "right" way).  But I embrace technology, and the online land and plat records have made my practice immeasurably more efficient.  E-Recording is here, and I embrace that as well.  While I want to see what safeguards are put in place to guard our precious land records, there are significant efficiency benefits all around and this is the way it will be in the future -- hopefully sooner than later.

Others believe the change is long overdue:

 Great idea!  I know everyone is afraid of it but, over 40 counties in FL use e-recording and it works. ...As my old property law professor told me about 35 years ago,  “the law helps those who help themselves, generally the vigilant, rarely the sleeping and never the acquiescent.“

A common theme among all age groups is the relative inefficiency of current manual recording, which requires disparate county offices to process documents:

The whole process of going to different governmental offices, getting stamps and waiting for physical documents to be mailed back from Land Records seems quite inefficient in this day and age.

The truly dedicated recall that electronic recording once was a priority in Maryland, but it has been shelved for many years:

 E-recording, in one form or another, has been around since the  late 1990’s in Northern Virginia and, more recently in the District of Columbia.  The Maryland Legislature provided for an e-recording pilot project in 2006, but then allowed it to backwater.  While it backwatered, precious resources that could have been used for the project were diverted from Maryland’s Land Record Improvement Fund and individuals familiar with both the land records systems and the concept of electronic recording were lost to retirement. 

The CFPB, which has been overhauling the nation’s settlement process, has made nationwide electronic recording one of it’s goals.The AOC has once again picked up the banner of e-recording and is moving forward. 

The Maryland Land Title Association is working with the AOC to accomplish this objective.  I respectfully suggest that the time for objecting to the implementation of e-recording is in the past.  Instead, I encourage responses to Henry that identify potential problems that e-recording might create and/or provide constructive suggestions aimed at resolving those issues.  

Maryland has one of the most comprehensive and available online land records imaging systems in the nation. Please help the front end catch up.

But there is a core group of lawyers that fear an increased opportunity for fraudulent activity to creep into the system to corrupt chains of title:

Real estate is particularly valuable so anything that makes it easier to commit fraud is alarming. Electronic filing of documents will certainly make it easier for a fraudulent transaction to be perpetrated. While this can currently be done on paper, it will certainly be easier to do, and easier to escape being caught, to run a fraud that includes fraudulent release of existing mortgages, coupled with a fraudulent Deed and then mortgaging or selling the property to monetize the scam. Given the fact that one of the problems peculiar to real estate transactions and recorded documents is that they can lay dormant for quite some time (sometimes many, many years) before someone has reason to research a title and discover the issue, I think that the current system of requiring original documents protects the public to a much greater degree. The balance of potential harm compared to the convenience is not worth the tradeoff, in my opinion.

One real estate lawyer with over 40 years of practice voiced this common fear:

 How can the Clerk's office possibly know if the document being recorded is really an original document, OR if it is a copy of a copy, OR if it is a contrived and/or modified copy of a copy ? I believe that the Land Records are already most susceptible to that type of deception, and a recording system where no representative of the Circuit Court must even see or verify that an original document EVEN EXISTS, would be a horrible thing.

 And there you have it, a true split of opinions for and against electronic filing of deeds and other title documents. If the money is available to implement a system, though, it is a sure bet that e-filing is coming to Baltimore County.

What do you think?

UPDATE Oct. 1, 2014:  Here is a recent piece on the issue, published in the Daily Record.

Congratulations Baltimore Orioles Eastern Division Champs!

We are just pleased as punch that the Orioles are the American League Eastern Division Champions!  See you at the Yard.

The job interview you really had.

The job interview is not science, but more art. The outcome of many interviews are determined by wrong impressions. Imagine if every thought was expressed by both the interviewer and the applicant?

Post by BuzzFeed Video.

Deal me out! Casino wars in Baltimore trigger allegations of client list theft.

Maryland law has always protected employers when high ranking employees leave with important client lists. And in the high stakes industry of casino gambling, the departing employee can expect only the most immediate and ruthless reaction to the perceived theft of client lists.

On August 22, 2014, Maryland Live! sued a former VIP Casino Host that jumped ship to take a job with the Horseshoe Casino, scheduled to open in just a few days. At issue is the alleged mis-use of a "high rollers" list of Maryland Live! clients.

According to the public filing in the United States District Court for the District of Maryland, Helena Wong carried a list of 1,000 high roller participants in Maryland Live's Chairman Club and Black Card programs. The lawsuit alleges secret and masked e-mails soliciting these clients to bring their gambling to the Horseshoe Casino.

Ms. Wong's alleged e-mails, quoted in the court papers, begs her former clients to keep her secret, imploring them

...PLEASE DO NOT repeat or show this email to any of MD Live's Personnel. This is a confidential email between us.

 Ms. Wong is alleged to have signed an agreement that promises to keep this type of customer list private and confidential, as it is the property of her former employer, Maryland Live!.

On the same day the complaint was filed, the federal court issued a temporary restraining order barring Ms. Wong from contacting or using the list.  This order comes just four days before the Horseshoe Casino opens. She will have a chance in 21 days to contest the TRO when the Horseshoe Casino will next argue to extend the TRO for the duration of the case.

Ms. Wong is in for a long and painful court experience. If it is proven that she deliberately broke an agreement to leave customer lists behind, she could incur a costly civil judgment.

But this isn't necessarily about Ms. Wong.  It is about the steep competition among the 15 casinos located within 250 miles of Maryland Live! Casino's 4,200 slot machines, 189 table games, seven restaurants, concert venue and shopping.  And it doesn't just happen to casino employees. In every competitive industry, companies sue to stop the free movement of key employees from one corporate office to another.  Cases in this law office have involved the exact same legal issues, while involving employees of less glamorous or less publicized industries, such as manufacturing companies, professional practices, and even the route salesman who delivers peanuts to your quick-mart.

Really, peanut company A sued to prevent a former driver from working for peanut company B delivering little bags of nuts to a list of quick-marts. Even where the profit margins are thing, companies will flail their former employees to maintain a competitive advantage in the marketplace.

All these cases have one common theme-- Maryland law is heavily in favor of protecting the former employer's trade secrets and customer lists.  There are certainly valid defenses to these claims.  For example, if the names on the gambling client list are equally accessible from some non-privileged source (imagine an industry listing of known high-rollers), then this particular list may not warrant court protection.

But even a defensible claim must be actually defended.  And that is where the former employee is at great risk.  Right at the moment where the court wields its greatest authority to stop you from working, or compels return of information vital to your livelihood, you must expend money you might no longer be empowered to earn and hire a lawyer.

It is economic warfare, and the employee is not necessarily the primary target.  Ms. Wong may only be cannon fodder for the larger battle between two Goliaths of the industry.

Think you will make a move to take a new job with a competitor?  Did you sign a confidentiality or non-competition agreement?  Then consider your options very carefully before over-selling your value to that new employer or folks might write a blog post about your case.

UPDATE 9-2-2014:  The evidence at the preliminary injunction hearing (the second hearing, to see if the TRO would stay in place) demonstrated that Ms. Wong contacted only 19 gamblers from her former employer.  It appears she memorized them, and did not actually steal a list.  But nonetheless, she and her new employer may not contact these 19 gamblers until the case is resolved.

And wouldn't you know, it was one of the gamblers that ratted Ms. Wong out to her former employer, calling the contact "unprofessional."  But yet, he also testified to attending the opening of the new Horseshoe Casino, saying "I'm not an idiot..." Just hilarious.

When does the fat lady sing?

Appeals can only be taken from a final order of the trial court. A non-lawyer may well presume that a court order saying "you lose" on a motion is final, and will send the case to Annapolis (where our appellate courts are located).

Nope.

The court order declaring "you lose" is often just an early step in a battle to get to the final-final decision, and your right of appeal. In fact, one of the most common questions our law firm gets from potential clients is "when may I appeal?"  The Maryland Court of Special Appeals explained how this works in a very recent appeal arising from a foreclosure, called Baltimore Home Alliance v. Geesing.

In this case, the third-party purchaser put down $27,000 dollars at the auction but failed to close the deal.  The foreclosing lender declared the third-party in default and asked the circuit court to enter an order permitting a second auction sale, and forfeiture of the deposit.   The circuit court granted the motion, and the property went back up for auction, where it was purchased by another party. The deposit was forfeited to the foreclosing lender.

Seems pretty final, right?  A broken deal, a court order of default and forfeiture of the $27,000 deposit and a resale of the property.The Baltimore Home Alliance thought so, and it filed an appeal with the Maryland Court of Special Appeals.

The case was not final, and the appeal was premature.  But why?

In the context of foreclosures, it is the final auditor's report that signals the fat lady to tune up. Once the court approves the audit, then all prior decisions are deemed final for purposes of appeal. And so while the court ordered that the third-party buyer's $27,000 was forfeited to the foreclosing lender, it did not say whether it would be a credit against other damages incurred because of the lost sale.  That would show up in the auditor's report. And even then, the parties could object to the auditor's treatment of the court's order and make argument for their positions at a hearing. Only after disposition of those objections is the forfeiture order, entered much earlier in the case, deemed final.

And so, "finality" is not the same in every case.  It depends on the nature of the action, the number of parties, and the stage of the proceeding when the adverse ruling was made. What seems final to you may just be the beginning of the next fight.

The Fat Lady sings a different tune in every case.

Ian Valkenet joins the District of Columbia Bar

Ian Valkenet is now sworn to handle your cases in the District of Columbia.  This includes the Superior Court, where civil and criminal matters are tried before juries and judges, and the Court of Appeals.

Ian has been practicing law in the trial and appellate courts of Maryland, and in the federal trial and appellate courts for two years.

The District of Columbia Court of Appeals

Your broken leg is now the Trustee's broken leg. Feel better?

File for bankruptcy court protection and you give up all of your potential claims, including claims for personal injury, to the bankruptcy trustee.  The District of Columbia Court of Appeals July 3, 2014 decision in Atkins v. 4940 Wisconsin, LLC forcefully makes the point.

Financial strain pushes well intentioned and honest folks into bankruptcy.  It is an honorable tool for re-establishing your financial life, and wiping away crushing debt.  What is often forgotten, though, is the debtor's duty to disclose not just all claims he may have against others, but any possible and contingent claims.  At the moment you file for bankruptcy protection by delivering your petition to the court, every right of recovery you have becomes "property of the estate."

And it is the court appointed bankruptcy trustee, often a lawyer, who has absolute control over the claim--not you.

Mr. Atkins tried to game the system.  His bankruptcy petition conveniently omitted reference to his potential slip and fall case. He later sued to recover money, and the defendant he was suing argued it was not Mr. Atkins' claim to make, anymore.

The court of appeals confirmed that Mr. Atkins could not bring the claim.  His failure to list the personal injury claim in his bankruptcy petition amounted to a statement that he had no such claim. And since the bankruptcy petition and schedules were submitted under oath, the statement that he had no such claims was under the penalties of perjury. His later claim in a separate lawsuit was thus inconsistent with his prior disclosures to the bankruptcy court.

You can't swear to the absence of a claim in your bankruptcy petition and schedules, and later assert a claim in a lawsuit to recover money.  The court will hold that you are not allowed to bring the claim. When you are prohibited from asserting a claim because you took an inconsistent position in an earlier case, it is called "judicial estoppel."

We most often see this issue arise in cases where parties have prepared legal papers without the assistance of counsel.  As we have suggested in a prior post, do-it-yourself law is risky business.

Delivery means giving up control of the deed.

 Ownership of your home is transferred by a written deed. It is very common to jointly title a home in the name of a husband and wife to keep the house out of probate.  It is easy to write a deed that says "Joe gives this land to Joe and Jenny, as husband and wife," so that the married partners jointly own the home. And when one or the other dies, the survivor gets full ownership of the home, outside of the formal probate process.  In this situation, ownership passes from one spouse to the surviving spouse at the moment of death, with nothing more required--it is automatic. 

     But simply writing and signing the deed is not enough. There is an important step in the process, dating back hundreds of years, that is often forgotten. The Maryland Court of Special Appeals just reaffirmed the historical concept that a deed must be "delivered" in order to effectively transfer title to real property. Without this final step, absolutely no transfer of ownership is accomplished.

     In Daniels v. Daniels, the intermediate appellate court relied on this ancient concept to pull  title to a home away from a surviving wife so that it would be included in the estate of her dead husband. It held that the ownership interest was not "delivered" because the deed remained for six years in a filing cabinet in the couples home. Because the husband who wrote the deed to transfer an interest to his wife had access to the deed, and because he could have destroyed the deed at any time, the court ruled that the deed had not been delivered. The wife knew about the deed, and both understood that the document made them joint owners, but the trial court and appellate courts  both concluded that this simply was not enough.  A fully executed deed that is accepted by the other party is just not enough to transfer ownership unless it is "delivered." And that means giving up any right to get the deed back, or to destroy the deed.

            The method for delivery of ownership has changed a bit since the days of old. Hundreds of years ago, ownership of land was officially delivered through a ceremony often called the “Liveryof Seisin.” In this ceremony the person giving the land would present he person receiving the land with a clump of earth from the property being transferred.

           As is described in this court decision, delivery is now complete when the person who is giving the land no longer has any control over the deed. He must not only surrender physical possession of the actual land, but he must have no right to recall the deed giving legal title to the land-- the deal must be final. While this seems simple, it has gotten people into trouble just like Mr. Daniels.
     Mr. Daniels clearly intended that his wife of over forty years would inherit full ownership of their home. And the trial court even acknowledged this fact. But because he did not take the advice of others to record the deed and because he chose to keep it in a filing cabinet with the couple's important papers, his wife was denied full ownership. Instead, Mr. Daniels daughter was able to use the lack of formal delivery to defeat his intent and force the home into probate, where the daughter would inherit partial ownership.
     Unfortunately, property ownership and inheritance is too often the ultimate family battle ground. We can only guess at the daughter's motivation for wresting the house away from mom.

      So how can you make sure that you have properly delivered a deed? The best method of delivery is to record a deed in the Land Records. Once a deed has been recorded in the county land records, it becomes a matter of public record and it can’t be taken back. Mr. Daniels might have saved his wife lots of trouble, and he might have prevented a big family squabble if he had taken the advice of his professionals to simply record the deed.

The Supremes take a big step to protect your cell phone data from unreasonable search.

Riley v. California protects all of us from immediate and unwarranted police intrusion. Decided on June 25, 2014, the United States Supreme Court made it the law across the entire Country that our digital information may not be mined from our cell phone simply because we are arrested.  The police may quarantine your phone and remove it from network access, but they must obtain a warrant before digging through your data and apps. The Fourth Amendment to the United States Constitution continues to protect all of us from unreasonable searches and seizures.



The Fourth Amendment assures that:

[t]he right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

The Supremes have resolved conflicting lower court rulings from California and Massachusetts about whether police search and seizure of cell phone data after an arrest was reasonable, or whether it was unreasonable in the absence of a warrant. The justices were required to apply old principles of Constitutional law to new smart phone technology that a "...visitor from Mars might conclude [is] an important feature of human anatomy." How to apply two hundred year old ideas to technology that was inconceivable just ten years ago?  The court did not have a single prior decision to address the issue, but was required to cobble together an analysis from other "search incident to arrest" cases.

You may ask yourself "what's the big deal, get arrested and deserve what you get, right?"  Then also ask yourself whether you would feel violated if a speeding ticket would be enough justification for law enforcement to scroll through your phone contact list, phone log and social media apps?  And what if substantive criminal charges arose from what the police found on your phone?  That is what happened in the two cases from California and Massachusetts.

California's highest state court affirmed a conviction based on cell phone data retrieved after Mr. Riley was arrested for a traffic violation.  His cell phone was taken from his pants pocket.  The phone contained texts and videos reflecting gang activity leading to additional charges against Mr. Riley.  He was charged in connection with a shooting, and at trial the State of California sought enhanced penalties due to gang affiliation evidenced in the videos.

In Massachusetts the federal appellate court overturned a conviction based on cell phone data in a similar case. In Massachusetts, Mr. Wurie was arrested after being observed in a drug sale.  His cell phone was inspected by the police. They used his call log showing heavy activity with certain cell numbers to obtain a warrant to search his apartment.  The police found drugs, guns and ammo. This lead to additional charges and a conviction.

Older Supreme Court cases give us some protection, already, from unreasonable searches by the police.  Traditional application of older law says that police may search us without need for a warrant  if it is done "incident to arrest." That means a search of our immediate person and vicinity to discern weapons or objects that might harm an officer or facilitate our escape. It also means gathering evidence of the suspected crime before it is concealed or destroyed.

So, where does a cell phone residing in your pocket or purse fall within this analysis? And what of the data and access to further data through your apps fall within this analysis? With an estimated 327 million cell phones in the United States, the answer to these questions impact your privacy, mine, and the privacy of every person linked to us via our smart phones.

The "incident to arrest" search has historically been limited to physical objects. But the intangible data on your smartphone does not quite fit, and it is not the same threat to the cops.  The Government argued in this case that data poses an indirect threat, perhaps, and that preventing remote wiping or data encryption could justify an immediate search incident to the arrest.

The Court rejected all of this, confirming our common sense understanding that comparing the risk to officers caused by physical objects to the risk created by intangible data is like comparing "a ride on horseback" to a "flight to the moon."

The risk of data loss to encryption and remote wiping can be readily mitigated if the phone is segregated from its network, perhaps in a "Faraday Bag," or by removal of its battery. The normal process of obtaining a warrant for further examination can then be obtained by the police in the ordinary course.

Chalk up a victory for your personal privacy. Other aspects of Government intrusion into your life may continue, relatively unabated, but you are slightly more protected from intrusions into your electronic life by the beat cop.

Fight or fail, it's your case!

There is a high cost to filing or defending any civil lawsuit. The filed complaint is followed by a period of "discovery," where each side makes written requests for information, and where parties and witnesses must sit for deposition. It is where much of your litigation costs are incurred.

Starting or defending a court fight is expensive, and it takes focus over a prolonged period of time.

The skilled practitioner will focus the available discovery tools to maximize you budget, but you cannot control what the other side will demand of you.  The court schedule and rules have broad restrictions on discovery, but when you enter the litigation realm you will be immediately subject to multiple demands by the other side. You must respond to written interrogatories, requests for admission of facts and authenticity of documents, requests for production of documents and things, electronic data, physical examination or independent medical examination, deposition. Responses must be carefully prepared, and timely produced. And none of the effort to generate your responses comes cheap.

And your lawyer cannot answer discovery without your close involvement- after all, the questions relate to YOUR life and business, not his.

On May 29, 2014, the Maryland Court of Special Appeals decided Valentine-Bowers v. The Retina Group and hammered down a plaintiff who absolutely failed to adhere to the rules on discovery. After having sued a doctor and his business for medical malpractice, Ms. Valentine-Bowers did not play by the rules.

• She did not file responses to discover requests;
• She did not appear for deposition;
• She did not stay in touch with her lawyer or respond to his requests;
• She and her lawyer did not comply with several court orders compelling her participation.

Ms. Valentine-Bowers' case was dismissed by the trial court. And the appellate court confirmed the correctness of this decision.  In the face of Ms. Valentine-Bowers' absolute refusal to participate in the lawsuit that she started, dismissal of her case was necessary to protect the defendants, and the sanctity of the court system.

What does this mean for your case?  

Whether you have filed a case, or you are defending against the claims of others, you have no choice but to participate in the discovery process. Close cooperation with your lawyer is the investment you must make to manage both your time and expenses. Work the case, together, to a satisfactory result.

I received a civil demand letter. What do I do?

“I made a mistake.   I was caught trying to shoplift.  I gave the merchandise back, and was released.  I thought this was all behind me, until I received a letter in the mail demanding payment.  What is a civil demand letter, and what should I do about it?”

What is a civil demand letter

The letter will identify you, and accuse you of theft.  The letter will demand a return of the merchandise (if not already returned), payment equal to the value of the merchandise (if the merchandise was destroyed), payment for the lost time/wage of the employee(s) who apprehended you, and payment of a civil penalty equal to twice (2x) the value of the stolen items.  See, the Maryland Courts & Judicial Article of the Maryland Code § 3-1302.

What happens if I pay the amount demanded?

If you pay the demand, the store cannot make any further civil demands against you relating to the same theft.  See, Md. Cts. & Jud. Proc. Code § 3-1304.  However, that payment can be used against you in subsequent criminal proceedings to demonstrate your guilt.  See, Maryland Rule 5-804(b)(3).  Payment of the civil demand does not preclude criminal prosecution.  See, Md. Cts. & Jud. Proc. § 3-1306(b).

What happens if I ignore the demand letter?

If you ignore the demand, the store may sue you, civilly.  They must file a small claim in district court, and serve you with a summons.  If they are successful, they may recover attorney’s fees and court costs, regardless of your ability to pay.  See, Md. Cts. & Jud. Proc. § 3-1305(b).  Generally, however, the time and effort required to prosecute a small claim deters such lawsuits.

What can happen, regardless of my decision?

Whether you pay the civil demand or not, the store can swear-out a criminal complaint, and you may be charged with a crime.  Maryland’s consolidated theft statute establishes maximum penalties based on the value of the items stolen:

Value	Type	Max Penalty
< $100	Misdemeanor	90 days / $500
< $1,000	Misdemeanor	18 months / $500
$1,000 - $9,999	Felony	10 years / $10,000
$10,000 - $99,999	Felony	15 years / $15,000
$100,000+	Felony	25 years / $25,000

See, Maryland Criminal Law Article § 7-104.

If you are charged with an incarcerable crime, you are entitled to a lawyer, regardless of your income.  Hire a private attorney, or apply for representation through the Office of the Public Defender.

Murder, cell phones and a trip to the mall.

The information generated by your cell phone usage is not private, at least not from the police. In Williams v. State, reported on February 24, 2104, the Maryland Court of Special Appeals confirmed that your cell phone records really are not private, whether you are under arrest, or not.

Why not? Because every phone number received or dialed, and the owner of those numbers, is available to the police by direct inquiry to the cell phone provider. The cell phone company is an "independent source." And under Maryland criminal law, where information is equally available to police from an independent source, it will excuse improper seizure by police of the same information out of your cell phone.

The story behind the case is gruesome, and a bit scary. The victim, 19 year old Rodney Pridget, was shopping at the Towson Town Center Mall with his girlfriend. They made the same stops and detours through the mall that any one of us would have made on a casual shopping trip. Nordstroms Department Store was their last stop before leaving the mall, through the adjacent parking garage.

The couple had no idea that five people, affiliated with a gang, had been tracking them through cell phone calls, as they were shopping.

In the garage, Rodney was murdered in a hail of gun fire that inflicted eight bullet wounds to his head, torso and arms. The ferocity of the attack was summarized by one of the shooters, who called another participant to say "we tore his ass up."

When police arrived, a witness pointed out a suspect running up and down the garage stairs (looking for the getaway car that had abandoned him) while talking frantically into a cell phone. That young man was Mr. Williams.

Mr. Williams was cuffed and searched.  His cell phone was confiscated. When a witness could not positively identify Mr. Willliams, the cuffs were removed. But the cell phone was not returned to him.

Mr. Williams was taken to the police station for more questioning, while being told he was not formally under arrest, but was simply being questioned.

"It was only later that evening, when Officer Jednorski was in the screening room to observe the appellant's interview with Detective Lambert, that Officer Jednorski looked down at the cellphone whenever it would ring and then jotted down the numbers from which the calls had been placed. "

The phone was returned to Mr. Williams when he later left the police station.

Mr. Williams and others were charged. Mr. Williams was the one who ordered the murder, and he was convicted of first degree premeditated murder. He did not appeal from the finding of his guilt.  He appealed the trial court failure to suppress information taken from his cell phone- the numbers and identities of his fellow co-conspirators and murderers.

And while some find it distasteful that a convicted murder should have any appeal rights, this is an important issue for all of us who use cell phones- Can the police seize them and use information found on them against us?

It is pretty settled in Maryland that when you are under arrest, the police absolutely are authorized to search through your cell phone.

"If the thing seized as an incident of an arrest turns out to be an instrumentality of crime (a weapon), a fruit of crime (stolen goods), contraband, or other evidence, it may be retained even after the arrest to which its search and seizure were incident has itself come to an end. If none of those categories is satisfied before the arrest is terminated, however, there is no longer a justification for retaining the property of the former arrestee. The property should be returned and is not vulnerable to further examination."

In Mr. Williams' case, the cuffs had been removed from Mr. Williams at the parking garage, before he was transported to the police station for questioning.  He had been "under arrest" when the cell phone was taken, but he had been "un-arrested" before traveling to the police station. And yet, the police maintained possession of his phone and mined for information while he was being questioned. 

So, do you think the issue was resolved based on the court's analysis of whether Mr. Williams was "under arrest" at the time the phone was mined for data? No. The court relied upon the broad application of the "independent source" doctrine to rule no-harm-no foul.

"When the police subsequently asked the phone company for the appellant's cellphone records, even assuming they needed his cellphone number to make the initial request, they had it from the independent source as well as from looking at the cellphone itself. This is a classic application of the independent source principle."

* * * *

"At trial, Detective Lambert and Detective Chuck Gruss provided the jury

with detailed descriptions of the cellphone records not only of the appellant but also of Jermell Brandon, William Ward, Crystal Harris, and Marilyn "Baby Sis" Hollemand, all of whom were in regular contact with each other before, during, and after the shooting of Rodney Pridget. This detailed analysis was based on the telephone company records, not on the observations of Officer Jednorski. The source of the information was an independent source not subject to Fourth Amendment exclusion. Thus, the independent source alternative route takes us safely around the search incident quagmire.3 Evidence of the various phone calls was properly not suppressed."

If there is an independent source for your cell phone information, regardless of whether the information was first discovered on your phone, or through the independent source, the evidence need not be suppressed.  You simply have no practical expectation of privacy in your phone records....ever.

Maryland reinstates ground rent remedy of ejectment and reentry.

On February 26, 2014 Maryland's Court of Appeals struck a statute that eliminated a ground rent owner's right of re-entry.  Maryland v. Goldberg is a slam dunk victory for ground rent owners of property consisting of four or less residential units. By this opinion written by Judge Harrell, they have reclaimed the right to eject delinquent tenants, and exercise their full reversionary interest in the real property.

This builds on the 2011 Muskin decision, which struck the legislature's effort to invoke mandatory ground rent registration. The failure to register would have caused complete forfeiture, or loss, of the ground rent owner's rights in the real property.

The owners of ground rents challenged the State of Maryland in the Circuit Court for Anne Arundel County, arguing that the most important aspect of a ground rent is the owner's right to reclaim the property if rent is not paid.  Just like your apartment, a ground rent owner has traditionally been able to evict a non-paying tenant, and reclaim the entire fee interest in the land. But in 2007, after a wave of bad publicity about evictions, Maryland's legislature passed a law that took away the ground rent owner's right to evict a tenant for failure to pay.

The owners of ground rents argued that that the right to re-enter and evict is a vested property right, and that the legislature violated some basic constitutional precepts by swapping this remedy for a system of liens.

Under Maryland's new statute, a ground rent owner was entitled only to impose a lien for unpaid ground rent.  And like any other lien, it could be foreclosed.  That meant the ground rent owner would get paid out of the fund created by the foreclosure sale. The Court of Appeals described it this way:

Shortly put, this process replaced ejectment with a lien-and-foreclosure sale. The, lien receives priority from the date the ground lease was created. The debt is paid from
the proceeds of the sale. If the ground lease is redeemable, the redemption amount is deducted also from the proceeds of the sale. If the ground lease is irredeemable, the foreclosure buyer takes subject to the ground lease.

The legislature had completely eviscerated the ground rent owner's right to take back the property upon the failure to pay rent. The trial court ruled against the State of Maryland, and in favor of the ground rent holders.

And the highest court stood firm. declaring that the right of re-entry and ejectment is a fundamental property right, fully vested and deserving of constitutional protection. This is a good thing for property rights, which have been eroded steadily by legislative action.

Do you own land with four or fewer residential units that is subject to annual or bi-annual ground rent? Are you buying or selling land subject to ground rents? Or are you an owner of a ground rent? The questions that will arise in your transactions go beyond the mere existence of a ground rent.  For example, what must be done with liens that have already been filed pursuant to the now invalid law? Can they still be foreclosed?

Your upcoming settlements and title claims just got a bit more interesting.

Columbia Gas flexes federal muscle to take easements.

The Federal Government has sanctioned an attack by a private natural gas provider on the property rights of residents in Harford and Baltimore Counties. In three federal lawsuits, the Columbia Gas Transmission, LLC has sued to take easements from the owners of 76 Acres of land in order to place a 26 inch pipeline, temporary licenses to sink "boreholes,"  and easements over an additional 560 acres of land, including land protected by Maryland State Conservation Easements.

The lawsuits were filed in January and February of 2014, and many of the named defendants may not yet know they have been sued.

What does Columbia want?

The Federal Energy Regulatory Commission (commonly known as "FERC") granted Columbia permission to conduct a multi-million dollar project intended to upgrade an existing natural gas pipeline in Maryland.  From FERC's order on the application

...the proposed project will disturb approximately 305.4 acres of land.

These acres are comprised of 50' to 60' strips of land, temporary wells, and access roads throughout Baltimore and Harford County. 

Can Columbia force landowners to give up rights in land?

Yes. FERC's Order grants the authority to Columbia.  The law requires that Columbia first attempt to negotiate purchase of an easement or license in the land from the landowner.  If negotiations are not successful (the owner either wants too much, or Columbia offers too little), the law permits Columbia to use the power of eminent domain to take what it needs.  Here is an excerpt from the controlling Federal Act:

15 U.S.C. Sec. 717h:

(h) Right of eminent domain for construction of pipelines, etc.

When any holder of a certificate of public convenience and necessity cannot acquire by contract, or is unable to agree with the owner of property to the compensation to be paid for, the necessary right-of-way to construct, operate, and maintain a pipe line or pipe lines for the transportation of natural gas, and the necessary land or other property, in addition to right-of-way, for the location of compressor stations, pressure apparatus, or other stations or equipment necessary to the proper operation of such pipe line or pipe lines, it may acquire the same by the exercise of the right of eminent domain in the district court of the United States for the district in which such property may be located, or in the State courts. The practice and procedure in any action or proceeding for that purpose in the district court of the United States shall conform as nearly as may be with the practice and procedure in similar action or proceeding in the courts of the State where the property is situated: Provided, That the United States district courts shall only have jurisdiction of cases when the amount claimed by the owner of the property to be condemned exceeds $3,000.

Who can Columbia sue?

Anyone with an interest in the land over which the easement or license is sought must be named as a defendant in the lawsuit.  This is because Columbia is attempting to take a valuable property right, and so all persons holding an interest in the land are entitled to contest the taking, and to share in money paid by Columbia.  Here is an excerpt from the court rule describing who must be included in the lawsuit:

Rule 71.1

 (3) Parties. When the action commences, the plaintiff need join as defendants only those persons who have or claim an interest in the property and whose names are then known. But before any hearing on compensation, the plaintiff must add as defendants all those persons who have or claim an interest and whose names have become known or can be found by a reasonably diligent search of the records, considering both the property's character and value and the interests to be acquired. All others may be made defendants under the designation “Unknown Owners.”

What must a defendant do in response to the lawsuit?

The court rules require very specific things from a defendant.  And if they are not done, on time, then a defendant loses the right to raise certain legal issues, or to contest Columbia's methods of valuation.  Another excerpt from Rule 71.1 describing an defendant's obligations after being served with the initial complaint follow:
 e) Appearance or Answer.

(1) Notice of Appearance. A defendant that has no objection or defense to the taking of its property may serve a notice of appearance designating the property in which it claims an interest. The defendant must then be given notice of all later proceedings affecting the defendant.

(2) Answer. A defendant that has an objection or defense to the taking must serve an answer within 21 days after being served with the notice. The answer must:

(A) identify the property in which the defendant claims an interest;

(B) state the nature and extent of the interest; and

(C) state all the defendant's objections and defenses to the taking.

And from the same rule, the following describes the bad things that happen if a timely response is not made by a defendant:

(3) Waiver of Other Objections and Defenses; Evidence on Compensation. A defendant waives all objections and defenses not stated in its answer. No other pleading or motion asserting an additional objection or defense is allowed. But at the trial on compensation, a defendant—whether or not it has previously appeared or answered—may present evidence on the amount of compensation to be paid and may share in the award.

What happens in the case?

The court will issue a scheduling order.  The order will have deadlines for discovery (where both sides share information about the legal issues and facts, including competing estimates of value).  The schedule will provide for status and settlement conferences with the court (or a federal magistrate judge), and for the filing of motions (where the parties argue that a decision can be made without need for a trial).

Who makes the decisions?

The federal judge will decide the facts and the law in the case. But the judge has the option to defer decision of the compensation issue to a "tribunal." That is just a fancy way of describing a panel of three experts put together to hear that one issue.  The judge may also permit the compensation question to be answered by a jury (if a party makes a timely jury demand).  Here is an excerpt from Rule 71.1 describing the trial:

(h) Trial of the Issues.

(1) Issues Other Than Compensation; Compensation. In an action involving eminent domain under federal law, the court tries all issues, including compensation, except when compensation must be determined:

(A) by any tribunal specially constituted by a federal statute to determine compensation; or

(B) if there is no such tribunal, by a jury when a party demands one within the time to answer or within any additional time the court sets, unless the court appoints a commission.

What happens after trial?

All cases have rights of appeal to the next court up the chain of command.  In this instance, that may include the United States Court of Appeals for the Fourth Circuit.

What steps should I take, now?

If you are named as a defendant in any eminent domain action, including these three filed by Columbia, you should:

1. Consult with a lawyer of your choice.  Among the things you should discuss with counsel is whether you have a title insurance policy.  Some modern title insurance policies (sometimes called "enhanced policies") have language that would require the insurance company to hire a lawyer for you, at no cost and expense to you.
2. File a timely response. Above all, don't miss the 21 day deadline! Bad things will happen if you do! Even after you submit a title insurance claim, keep an eye on the calendar.  Until the insurer actually notifies you that it has accepted your claim and engaged a lawyer, you are on your own to meet the court's deadlines.

What is an easement or license?

If Columbia is successful, by negotiation or final judgment, it will obtain a right to use a portion of the landowner's property. Columbia will not become an "owner" of the land, only an entity entitled to use the land for a specific purpose.

The landowner keeps ownership, and the quantity of land in his deed is not diminished.

Consider for a moment the power lines and towers you have observed crossing many farms as you drive down a highway. The utility company that owns those lines has a recorded document that describes what it can do within that easement. For example, it will have the written rights to fix and repair the power lines and towers, and it will have rights to drive equipment along the power lines to get access.  It will also have a wide "danger easement" that can be up to 100 feet on either side of the power lines. Within the danger zone, a utility has the right to trim or fell trees that might damage lines or towers. The utility work crews are on the easement every day, and over the course of a year, the landowner may hardly notice they have visited, at all.

Something to think about.

The FERC decision authorizing Columbia's land grab is on appeal. The immediate question, then, is whether Columbia has the right to file these lawsuits at this time. This is an issue that might be raised by preliminary motion.

Another question is whether Columbia has brought all necessary parties to the lawsuits. For example, mortgage lenders have liens on real property, and may arguably be required defendants in these cases.  And assuming each defendant has one loan secured by each parcel of property, the answer to this question could double the number of defendants.  More importantly, there may be leases, assignments of profits and rents, and mortgage documents in the land records that may require an owner to turn over or share any money paid by Columbia to third parties. That would certainly make them necessary parties to the lawsuit.  This is another issue that could be raised by preliminary motion.

And finally, how much time and effort does a landowner want to invest in this fight? Short of defeating Columbia's rights completely, which will require a long and costly fight, the real focus should be on the amount of compensation and the fine print detail of the proposed easement or license.

It is your land.  Protect it, fight for it, and if Columbia must have an easement, maximize your payment.