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[No.99]
September 30, 2004 |
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International Legal News
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Cases
Source:
Westlawinternational.com
In a recent decision, a panel
of the US Court of Appeals for the Ninth Circuit ruled on Tuesday that
California's tough anti-smoking advertisements do not violate the First
Amendment rights of tobacco companies. Attorneys for the tobacco companies RJ
Reynolds Tobacco Co. and Lorillard Tobacco Co. argued that because the tobacco
giants were being forced through excise taxes to pay for the ads in part, their
right to not be compelled to finance speech was violated by the ads, which they
claim unfairly tarnish their reputation by vilifying the tobacco industry. The
Court denied the appeal, ruling that the tobacco companies' position is a
fundamental misunderstanding of taxation principles.
R.J. Reynolds Tobacco v. Shewry
-
Legal Services: Attorney's
misconduct based on neglect of client matters, dishonesty, fraud, and deceit
warranted disbarment
An attorney's knowing
conversion of client funds, failing to keep client funds separate from his own,
failing to return client funds he did not earn, neglecting and abandoning client
matters entrusted to him, making false statements in court proceedings,
requesting a notary to notarize an unsigned document dated the previous year,
and failing to pay an employee for her services warranted disbarment. There was
no evidence of mitigation, and aggravating factors included a prior disciplinary
record, acting with a dishonest or selfish motive, engaging in a pattern of
misconduct, committing multiple offenses, failing to cooperate with disciplinary
proceedings, and demonstrating indifference to making restitution to those whose
funds he misappropriated or converted.
People v. Woodford
An at-will employee who alleged
that she was discharged from her dental employer because her adult daughter,
having become a patient of the employer, was contemplating a dental malpractice
action against the employer was able to assert the public policy underlying the
"open access to courts" provision of the Connecticut Constitution as a
basis for her wrongful discharge claim based on a violation of public policy. In
the arena of constitutional/public policy interests sufficient to support a tort
action for wrongful termination, one such interest was the unfettered right to
legal/court redress. The public policy violation was in the discharge of one
whose close relative's legal recourse was sought to be chilled or avenged by
retaliation. This was an issue of apparent first impression.
Fortunato v. Office of Silston
An arbitrator's decision, that
an employee could not be deemed "under the influence" after he failed
a drug test because he had obtained a prescription under Oregon's Medical
Marijuana Act, did not draw its essence from the parties' collective bargaining
agreement (CBA). The CBA's anti-discrimination and severability provisions did
not provide a basis to conclude that the parties intended for the CBA to conform
with or incorporate the Act. Furthermore, the Act did not make it illegal for
the parties to negotiate how the employer could discipline marijuana use.
Finally, although the CBA contemplated prescription-drug use at work, that
provision was not a basis for the arbitrator's decision.
Freightliner, LLC v. Teamsters
Local 305
The care and treatment provided
by an assistant trainer and a medical services coordinator for a professional
football organization to a football player who exhibited signs of heat
exhaustion during training was not pursuant to the organization's nondelegable
duty to provide its employees with a safe workplace or to remove safety hazards,
and therefore, the trainer and coordinator owed a personal duty of care to the
player, and were not entitled to co-employee immunity from liability under the
workers' compensation statute when the player died of heat stroke. However,
their actions did not rise to the level of gross negligence, as required for the
player's personal representative and his heirs to recover for wrongful death.
Furthermore, the actions taken by the head trainer in weighing the players prior
to and after practice were pursuant to the organization's duty to provide
employee's with a safe workplace, in that the purpose of weighing the players
was for the purpose of determining whether it was safe for the individual player
to practice.
Stringer v. Minnesota Vikings
Football Club, LLC
Two law firms were not
vicariously disqualified from representing a city, at the damages phase of a
developer's action alleging the city's development permit requirements violated
equal protection, although the law firms had retained, as expert witnesses on
damages, two attorneys, from a third law firm, who would be disqualified as
expert witnesses because they had previously represented the developer's
predecessor in interest and/or the predecessor's permit application agent. The
issue of whether to extend the vicarious disqualification rule to law firms,
which retained disqualified attorneys/experts, was a matter of apparent first
impression.
North Pacifica, LLC v. City of
Pacifica
A district court refused to
enjoin a display of the Confederate flag in an art exhibition by a private
college. Doing so would violate free speech guarantees, inasmuch as there was no
immediate and palpable risk of cognizable harm, and the display would cause no
greater immediate injury than personal offense. This was true even if the
display would glorify symbols and views of the Confederacy, engender anger and
fear among African-American residents, invite hate groups to come to the area
and protest, and advocate the overthrow of the United States government. The
high purpose of the First Amendment is to protect speech that some may find
objectionable, the District Court stated.
Coleman v. Gettysburg College
In an age discrimination class
action by television writers against studios, networks, and talent agencies
under the Fair Employment and Housing Act (FEHA), the writers could allege a
pattern or practice of discrimination in violation of the FEHA, without pleading
the particulars of each plaintiff's claim as a predicate for their pattern and
practice claims. Also, to obtain individual relief, after a pattern or practice
of discrimination is proved, a writer who did not apply for television writing
opportunities would have the burden of proving that he would have applied for a
position, during the limitations period, had it not been for the employer's
discriminatory practices, and would have been discriminatorily rejected had he
applied. Moreover, a talent agency would be liable for aiding and abetting an
employer's violation of the FEHA if the agency knew the employer's conduct
violated the FEHA and gave substantial assistance or encouragement to the
employer to so act.
Alch v. Superior Court
A 12-year-old victim who was
asleep at the time the defendant initiated sexual contact with him was
"physically helpless," and therefore, unable to communicate consent or
an unwillingness to act, for the purposes of a prosecution for first-degree
sexual abuse. Taken together with the victim's testimony about the sexual
contact and a police officer's testimony that the defendant admitted the contact
was intentional, was sufficient to support the defendant's conviction for that
offense.
Boone v. Com.
News
Therapeutic cloning for
research has been legal in the UK since 2001. In a recent development of its
kind, the scientists who cloned Dolly the sheep have formally applied for a
licence to clone human embryos to find a cure for motor neurone disease. Incase
if the license is granted, they would clone cells from MND patients to see how
the illness develops in an embryo. The licensing authority, the Human
Fertilisation and Embryology Authority has already granted a similar licence In
August. This application has provoked great criticism amongst the pro-life
campaigners.
The Department of Justice has
stated that all these years tobacco companies have been conducting false and
misleading public relations and advertising campaigns to deceive consumers and
others about the health effects of cigarettes in order to protect their profits.
As part of the largest civil racketeering trial in U.S. history, the government
now wants the tobacco companies to surrender, disgorge, in legal terms - $280
billion in past profits that was allegedly earned by fraud from the sale of
cigarettes and is seeking a number of court-ordered reforms. A win for the
government would potentially bankrupt the tobacco companies.
An anti-piracy bill, sponsored
by the Motion Picture Association of America has been signed by the California
Government, which makes it a crime for people to share copyrighted music or
movies online without providing for a valid e-mail address. In short the Bill
says that “any person, except a minor, who is located in California, who
disseminates a particular recording or audiovisual work to more than 10 other
people without disclosing his or her email, and the title of the commercial work
is punishable by a fine not exceeding $2,500, imprisonment in a county jail for
a period not exceeding one year, or by both.” This would come into effect in
January 2005 and would expire in January, 2010.
The U.S. Food and Drug
Administration has recently said that certain sections of the Topamax website
fail to disclose information regarding the serious side effects associated with
the drug, including oligohidrosis (decreased sweating), hyperthermia, and
metabolic acidosis, and is therefore in violation of the Federal Food, Drug, and
Cosmetic Act. They have therefore ordered the company to immediately cease the
dissemination of these drugs.
In effort to prevent child
deaths and injuries caused by the inadvertent closing of car windows, the
Government has ordered automakers to install safer power window switches in all
new vehicles made for sale in the U.S. on or after October 1, 2008. The
regulatory upgrade will prohibit non-recessed “rocker” or “toggle”
switches that can be unintentionally activated by a small child playing in a
car. Most manufacturers are expected to comply with the new rule through the use
of recessed switches, or pull up-push down switches that must be lifted to close
the window. This regulation is likely to prevent the tragedy of a child's head
or limb being caught in a power window.
In October 2000, two attackers
on a small boat carrying up to 500lb (225 kg) of high explosives had rammed into
a ship as it was refuelling in the Aden port. On the question of sentence, the
Yemeni Court has sentenced two men to death over the bomb attack on the USS
Cole, which killed 17 people in 2000. One of the two men sentenced to death is
being held in US custody. Four other men have been given between five to ten
years in jail for the attack, which was blamed on the Osama Bin Laden’s al-Qaeda
network.
The Kyoto Protocol cuts the emission of
greenhouse gases, which are believed to cause global warming and climate change.
In a recent development, the Russian government has approved the Kyoto Protocol
on climatic changes and sent it to Parliament for ratification. In addition,
Moscow has wavered over the treaty until tomorrow. The necessary law on
ratification is set to pass through the Russian Parliament unhindered and, in
theory, the treaty could come into force within three months.
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Department of Company Affairs
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Circular No: 6/2004 Dated 10.08.2004:
The Department of Company Affairs vide its Circular No. 22/2002 dated 23rd
September, 2002 had clarified that the Investors’ Education Protection Fund (IEPF)
would become operational only on 1st October 2001 and all amounts due for
transfer should have to be transferred to it by 31st October, 2001. It also
clarified how, when and the date from which the unpaid and unclaimed dividend
due for payment prior to and after the amendment of Section 205A and the
enactment of Section 205 C by the Companies (Amendment) Act, 1999 should be
transferred to IEPF but the Companies were faced with practical difficulties in
depositing the unpaid dividend and other amounts referred to in section 205C
which had become due for payment into the IEPF. Therefore, the Department of
Company Affairs vide Circular No: 6/2004 Dated 10.08.2004 directs all Regional
Directors and Registrars of Companies that in cases where compliance had
actually been made by the company in question by depositing of the requisite
amount into the IEPF on or before 31st March, 2003, the objective of the said
circular shall be deemed to have been satisfied and therefore a company need not
be proceeded against for any penal action on grounds of delay upto 31.3.2003.
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Service Tax
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Circular No: 80/2004 Dated
17.09.2004: The Service Tax Department vide the above circular clarifies that
some new services like Business exhibition services and Intellectual property
services (other than copyrights) have come under the purview of service tax levy
with the enactment of The Finance Bill (No.2), 2004 on 10.09.2004. The circular
clarifies that organizers of events such as trade fairs, road shows, fashion
shows, display show-cases kept in airports, railway stations, hotels etc would
come within the purview of Business exhibition services and would be covered
under this new levy. A display of consumer goods in shops or shopping centers
for customers to select and purchase would normally not attract any service tax
unless an amount is collected for merely displaying an item. Also the circular
makes it clear that under the category of service tax leviable on Intellectual
property services (other than copyrights) IPRs covered under Indian law in force
at present alone are chargeable to service tax and IPRs like integrated circuits
or undisclosed information (not covered by Indian law) would not be covered
under taxable services. A permanent transfer of intellectual property right does
not amount to rendering of service.
Notification No: 29/2004 Dated
22.09.2004: The Ministry of Finance and Company Affairs vide Notification No:
29/2004 Dated 22.09.2004 notifies the exemption of taxable service provided to a
customer by a banking company or a financial institution including a non-banking
financial company, or any other body corporate or commercial concern, in
relation to overdraft facility, cash credit facility or discounting of bills,
bills of exchange or cheques. The value of such exemption is equivalent to the
amount of interest on such overdraft, cash credit or, as the case may be,
discount, from the service tax leviable under section 66 of the said Act,
subject to the condition that the said interest amount is shown separately in an
invoice, a bill or, a challan issued for this purpose
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RBI
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Circular No:
DBOD.IECS.NO.43/04.02.10/2004-05 Dated 17.09.2004: The Reserve Bank of India
vide the above circular notifies the Constitution of Sub-Committee of SLBC for
Export Promotion. This Committee will deal with the exporters’
problems in relation to export finance and other bank related issues at the
State level. Accordingly, this Sub-Committee, will include local exporters’
Associations, SBI and two/ three leading banks handling sizeable export
business, DGFT, Customs, State Government (Department of Commerce and Industry
and Department of Finance), EXIM Bank, ECGC, FEDAI besides RBI (Foreign Exchange
Department and Department of Banking Supervision) at regional level, as members
of the Committee. The Sub-Committee will meet at half-yearly intervals or
earlier if necessary and the first meeting shall be held latest by 31st October,
2004.
Circular No :
RPCD.PLNFS.BC.No.35/09.04.01/2004-2005 Dated 24.09.2004: The Reserve Bank of
India vide the above circular notifies the extension of the cut off date for
completion of disbursement for the cases sanctioned for the programme year 2003 –2004
to 15.11.2004 from the present cut off date of 30.09.2004 by the Govt of India.
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Revenue
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Circular No: 5/2004
(F.No.500/67/2003-FTD) Dated 28.09.2004: The Department of Revenue has issued
the above circular with regard to taxation of IT Enabled BPO Units in India.
According to the new circular, the Govt of India has decided to tax the IT
enabled BPO unit in India of a non-resident entity or a foreign company if the
same could be treated as Permanent Establishment of the non-resident entity. The
profits attributable to an IT enabled BPO unit constituting a Permanent
Establishment for taxation purposes will be on the basis of services rendered by
the Permanent Establishment to the Head office of the non resident entity or the
foreign company or by the Head office to the Permanent Establishment on the
basis of “arm’s length principle”.
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Press Information Bureau
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PIB release dated 23.09.2004:
The agreement for World Bank assisted “Integrated Disease Surveillance Project”
was signed between Government of India and World Bank on 23.09.2004. Under the
Agreement, the World Bank will provide a loan of US$ 68 million for the project.
The total cost of the project is estimated at US$ 88.64 million. Of these, World
Bank aid will be US$ 68 million. The project aims to improve the information
available to the Government health services and private health care providers on
a set of high priority diseases and risk factors, with a view to improving the
on-the-ground responses to such diseases and risk factors. The project will be
implemented over a period of five years in three phases. Phase I includes 9
states, Phase II another 13 states; and Phase III the remaining states and Union
Territories.
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Supreme Court |
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The respondents were a
company manufacturing computers, peripherals servers, notebooks and
accessories falling under Chapter 84 of the Central Excise Tariff Act,
1985. Later they received operational softwares from WIPRO, by way of a
license.
The main issue in this
case was regarding the amount of central excise duty payable on such
items. The appellants contented that an operational software implanted
in a hardware becomes a part thereof and therefore the excise duty is
leviable on the total value of the computer. They further contented that
a software with a license as regards the right to use the information
contained therein, should not be compared with a disc, floppy or CD—ROM.
On the other hand the respondents contented that a computer hardware is
marketable as such and incases where the software is implanted on
specific orders placed by customers, would retain the characteristics of
software.
The Supreme Court while
considering the relevant provisions of the Custom Tariff Act held that
the rate of excise duty for computer is 16% whereas for software is nil.
The computer and software are distinct and separate goods, and therefore
no central excise duty is leviable upon determination of the value
thereof by taking the total value of the computer and software. And
therefore when an exemption has to be granted, no excise duty can be
levied indirectly as it is impermissible to levy tax indirectly.
The petitioners
challenged the constitutionality of the various provisions of the
Prevention of Terrorism Act, 2002, by way of a petition under Article 32
of the Constitution. They contented that firstly, terrorist activities
were confined only to States and therefore the provisions falling under
Entry I of List II of Sch VII were beyond the legislative competence of
the Parliament. Secondly, in the absence of stipulation of knowledge,
the provision under Section 4 for punishment of a person in “unauthorized
possession” of arms or weapons was bad in law, since “unauthorized
possession” could even take place by non-renewal of a license.
Thirdly, section 14 of the act gave wide powers to the investigating
officer for compelling any person including lawyers & journalists,
to furnish information and was thus violative of Articles 14, 19, 20(3)
and 21 of the Constitution. Fourthly, certain sections did not include
the mens rea element and were therefore unconstitutional. In addition, a
plain reading of Section 27 amounted to compelling a person to give
evidence against himself, which was a violation of Articles 14, 20(3)
and 21. Similarly, Section 20 denied the examiner a right to cross
examination, which was again a violation of Article 21.
The Supreme Court while
dismissing the petition held that it was necessary to understand the
circumstances, which led to the enactment of POTA, which aims at
combating terrorism. Terrorism being a criminal act, was more than mere
criminality. And therefore to face terrorism, new approaches,
techniques, weapons, expertise and a new set of laws were needed. The
Court further stressed that anti-terrorism laws should be capable of
dissuading individuals or groups from resorting to terrorism, denying
the opportunities for the commission of acts of terrorism by creating
inhospitable environments. In such circumstances, it was just and proper
for the Parliament to enact POTA. Further the Courts held that the State
could impose reasonable restrictions in the interest of sovereignty and
integrity of the country.
The respondent, working
as a Sanskrit teacher in the Kendriya Vidyalaya Sangathan, Jabalpur, M.P.
was transferred to Jammu & Kashmir. Therefore he questioned the said
transfer before the Central Administrative Tribunal, Jabalpur on grounds
of alleged malafides and colourable exercise of power.
The main issue in this
case was whether such a transfer was valid. The Supreme Court while
considering an earlier decision held that:
“No government
servant or employee of a public undertaking has any legal right to be
posted forever at any one particular place or place of his choice
since transfer of a particular employee appointed to the class or
category of transferable posts from one place to another is not only
an incident, but a condition of service, necessary to public interest
and efficiency in public administration. Only where an order of
transfer is shown to be an outcome of a malafide exercise, can the
tribunals normally interfere with such orders. But such an order
cannot be challenged as a matter of routine and only incases of
administrative exigencies of the concerned service.
The Supreme Court while
allowing the appeal held that since the said transfer order, neither had
any malafides nor did it involve any colourable exercise of power, the
Tribunal was right in holding that the respondent could be posted to a
place outside M.P. |
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High Courts |
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Rajasthan
The Petitioner filed a
petition seeking divorce from the Respondent, pending the divorce
proceedings the Additional District Judge granted interim maintenance and litigation expenses for
every date of hearing. In the meantime, Respondent/wife filed an application under
section 125 Criminal Procedure Code in the court of the Chief Judicial
Magistrate, in the said proceedings interim maintenance was granted to
the wife.
Revision Petition
challenging the order of the Chief Judicial Magistrate granting interim
maintenance to the wife filed by the husband on the grounds that since
both courts have granted maintenance simultaneously, therefore wife
cannot be allowed to draw both amounts.
Rajasthan High Court
allowed the Revision Petition with the directions that the amount paid
by husband pending the divorce proceedings shall be adjusted towards
the amount of maintenance granted by the Chief Judicial Magistrate.
Bombay
The Appellant Company
had made payments as Royalty to M/s CIBA Geigy Limited, Switzerland for
transfer of technical know how. Show cause notice was issued demanding
payment of service tax from the Appellant Company under the category of
Consulting Engineers. Additional Commissioner Central Excise confirmed
the demand. Commissioner (Appeals) also did not interfere with the
order.
Thereafter, appellant filed an
Appeal against the order of the Commissioner of Central Excise, Mumbai
VI confirming the demand of service tax, ordering payment of interest,
and imposing penalty.
The Appeal was decided
by the West Zone Bench of the Customs, Excise and Service Tax Appellate
Tribunal whereby it was held that royalty paid by an Indian Company to
foreign Company for use of technology and know how cannot be equated
with payment for services provided by the foreign company to the Indian
Company, and is therefore exempted from Services Tax
Appellant manufacturer
of cable filling compound paid duty on the prevalent rates of Central
Excise. Simultaneously also claiming the benefit of MODVAT in respect
of several items purported to be inputs.
Notice issued to the
appellants on the grounds that the some of the inputs were not used at
all. Commissioner Of Central Excise, Delhi-I adjudicated the dispute
and came out with a finding that some of the inputs on which MODVAT had
been claimed were not being used at all by the Appellant. Demand
Confirmed and penalty imposed.
CESTAT, Northern
Bench, disposed of the appeal against the said order with a finding
that the order had been passed without considering relevant technical
material or examining/cross examining technical persons /experts. Matter
remanded back to be adjudicate after considering relevant materials.
Gujarat
Applicant was detained
u/s 12 COFEPOSA during emergency, on lifting of emergency he was
released, although the period of detention as per the order was to be
12 years. Notice u/s 6 (1) issued to legal heirs of the detenue, since
deceased. Thereafter, property of deceased forfeited under section 7 of
the S.A.F.E.M.A..
The said notice under
section 6(1) challenged by the legal heirs on the mainly on the grounds
that detention order which formed the basis of the proceedings already
stood revoked after release of the Applicant, since deceased,
proceedings themselves could not have been maintainable. Also contended that detention order was
also bad, as no grounds for detention had ever been formulated.
Gujarat High Court,
while allowing the petition directed maintenance of status quo with
respect to the property in question for 4 weeks with a view to enable
the competent authority to take action if any.
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