Ditullio v. Boehm

Citations: 662 F.3d 1091; 75 A.L.R. Fed. 2d 819; 2011 U.S. App. LEXIS 22510; 2011 WL 5313815Docket: 10-36012

Court: Court of Appeals for the Ninth Circuit; November 7, 2011; Federal Appellate Court

Original Court Document: View Document

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Josef F. Boehm pled guilty in November 2004 to conspiracy to engage in human trafficking, admitting to recruiting minors for sexual activities and providing them with controlled substances between 2001 and December 2003. Miranda Ditullio, identified as a victim in Boehm's plea agreement, seeks over $5 million in compensatory damages and up to $20 million in punitive damages under the Trafficking Victims Protection Act (TVPA), 18 U.S.C. 1589 et seq. The district court denied Ditullio's motion for summary judgment and Boehm's motion to dismiss, leading to an interlocutory appeal on two key questions: whether the TVPA allows for punitive damages and if the civil action provision of the TVPA, effective December 19, 2003, applies retroactively to conduct before that date. 

The court held that punitive damages are permissible under the TVPA since it establishes a tort-based cause of action. However, it ruled that 18 U.S.C. 1595 cannot be applied retroactively to acts committed before its effective date, even if related acts occurred afterward. The TVPA, enacted in 2000, aims to combat human trafficking, punish traffickers, and protect victims, specifically criminalizing activities related to coercing individuals into commercial sex acts. Amendments in 2003 expanded the scope of the TVPA, including the establishment of a private right of action for trafficking victims, allowing them to sue perpetrators for damages and attorney fees.

Section 1595, effective December 19, 2003, is part of the Trafficking Victims Protection Act (TVPA) as codified at 18 U.S.C. 1589 et seq. In November 2004, Boehm pled guilty to conspiracy to commit sex trafficking of children and to distribute controlled substances to minors. He admitted to conspiring with others to recruit juveniles for sexual acts, using cocaine as an enticement. Several minors, specifically named, were recruited for sex and received drugs or money from the defendants, who were aware of their ages. Ditullio filed a lawsuit in June 2009, later amending her complaint to include claims of involuntary servitude, violations of the TVPA, sexual assault, and emotional distress. She moved for summary judgment on Boehm's liability, providing evidence from Boehm's plea agreement and her affidavit identifying herself as victim "M.D." She alleged Boehm provided her with crack cocaine daily to manipulate her into sexual acts and stated she became pregnant in 2003, potentially by Boehm. Ditullio described ongoing emotional distress and inability to maintain employment due to Boehm's actions. Boehm denied her allegations and sought to strike her affidavit without presenting contrary evidence. The district court denied Ditullio’s motions for summary judgment, recognizing her as a victim of sex trafficking but ruling that the presumption against retroactivity barred her claims under section 1595 since there was no evidence of victimization after its effective date. The court also rejected her claim for punitive damages, stating she did not provide legal authority for such damages under the applicable statute.

Boehm filed a motion to dismiss under Federal Rule of Civil Procedure 12(c), which was denied by the district court. Ditullio sought an interlocutory appeal under 28 U.S.C. 1292(b), which the court granted, highlighting a debatable legal issue regarding the applicability of the statute to acts occurring before December 19, 2003. Ditullio's appeal challenges the district court’s decisions that the Trafficking Victims Protection Act (TVPA) does not allow punitive damages and does not apply retroactively to actions prior to its effective date. The court certified these issues for interlocutory appeal and confirmed jurisdiction under 28 U.S.C. 1292(b). The review of punitive damages and retroactive application of statutes is conducted de novo. 

The district court had concluded that punitive damages were unavailable under the TVPA without providing analysis. The term "damages" in the TVPA's civil remedy provision is deemed ambiguous, potentially encompassing various forms of damages. The dissent inaccurately characterized the court's stance as finding the statute "silent" on punitive damages. The court's position is that the ambiguity allows for punitive damages, supported by precedents from the Torture Victim Protection Act of 1991, which has seen punitive damages awarded in various cases. Ditullio asserts the availability of both compensatory and punitive damages based on the TVPA's tort-like cause of action and references legislative history and case law under 42 U.S.C. 1983. The court references the Supreme Court's ruling in Franklin v. Gwinnett County Public Schools, affirming that federal courts possess the authority to award appropriate relief unless explicitly restricted by Congress.

In tort law, punitive damages serve to punish defendants for egregious conduct and deter similar actions in the future, as established in the Restatement (Second) of Torts. These damages can be awarded even if the defendant has a prior criminal conviction for the same behavior. The Supreme Court has affirmed that punitive damages are part of common law tort actions, allowing juries to impose such damages in tort cases, as noted in Barry v. Edmunds. 

The availability of punitive damages under federal statutes, specifically 42 U.S.C. § 1983, has also been supported by Supreme Court rulings. Section 1983 holds individuals acting under color of law accountable for infringing on federally secured rights, and while it does not explicitly mention damages, the Court interprets it through common law principles. In Smith v. Wade, the Court confirmed that punitive damages are permissible under § 1983, citing a case involving a correctional officer’s violation of an inmate's Eighth Amendment rights. The officer contested the punitive damages awarded, arguing they required proof of intentional misconduct.

Moreover, the Court indicated that common law tort principles are the foundation for assessing damages under § 1983, as seen in Carey v. Piphus, and emphasized uniformity in applying these principles to fulfill Congress's intent. In Basista v. Weir, the Third Circuit reiterated that federal common law governs damages in § 1983 actions, underscoring the necessity of consistency in federal civil rights cases.

The document examines the availability of punitive damages under the Torture Victim Protection Act (TVPA) civil action provision. It establishes that punitive damages are appropriate as the TVPA addresses tortious conduct that is typically intentional and outrageous, aligning with the general rule of providing any suitable relief under federal statutes. A plaintiff must demonstrate that the defendant engaged in human trafficking, defined by Congress as a form of modern slavery. 

The Supreme Court has clarified that federal courts should not create new common law causes of action but can use common law principles to identify remedies specified by Congress. It notes that punitive damages are not allowed under statutes created under Congress’ Spending Clause unless explicitly stated, a distinction that does not apply to the TVPA, enacted under the Commerce Clause. The court concludes that punitive damages are permissible under 18 U.S.C. § 1595, and the plaintiff, Ditullio, may present her case for such damages to a jury.

Additionally, Ditullio seeks to apply § 1595 to actions occurring before its December 19, 2003 effective date, arguing for retroactive application. The Supreme Court's presumption is that the legal effect of conduct is evaluated under the law in effect at the time it occurred, unless Congress has clearly indicated otherwise. A two-step analysis is employed for retroactive application: first, determining if Congress explicitly defined the statute's reach, and second, assessing if applying the statute retroactively would impose an undesirable consequence. If either condition is met, retroactive application is not permitted without clear Congressional intent.

Section 1595 of the Trafficking Victims Protection Act (TVPA) cannot be applied retroactively to conduct occurring before December 19, 2003, as doing so would impose new burdens on the defendant, Boehm. Ditullio argues against retroactivity, asserting that she could already seek damages under state law and that her case involves ongoing violations since Boehm's alleged misconduct continued after the TVPA's enactment. However, these arguments fail to establish that section 1595 does not have a "retroactive consequence." 

The determination of retroactivity hinges on whether a statute imposes new legal consequences on past actions. The Supreme Court's decision in Landgraf clarifies that a statute operates retrospectively if it detrimentally affects existing rights or creates new liabilities for past conduct. Section 1595, which allows victims of trafficking to recover both compensatory and punitive damages, introduces new legal responsibilities related to TVPA violations, thus falling under the principles established in Landgraf. 

While Ditullio cites Alaska Statutes 09.55.650, which allows victims of sexual abuse to seek damages, this does not negate the retroactive implications of section 1595. The civil remedies provision of the TVPA alters substantive law and hence cannot be applied to conduct that preceded its enactment without explicit congressional intent.

The TVPA civil remedy provision establishes liability for actions beyond those covered by Alaska law, specifically holding individuals accountable for benefiting from child sex trafficking without requiring direct sexual contact with minors. This contrasts with the limitations of Alaska Stat. 09.55.650, leading to the rejection of Ditullio's argument that state law already allows for full recovery under 18 U.S.C. § 1595. 

Ditullio asserts that Boehm's ongoing conduct post-enactment of § 1595 means the statute's retroactive application should not apply. She cites immigration cases interpreting Landgraf principles regarding retroactivity and vested rights, arguing that a party contesting retroactivity must demonstrate reasonable reliance on pre-existing law. However, the core issue is whether retroactive application of § 1595 creates new liabilities, rather than interfering with vested rights, which requires a different analysis.

The court distinguishes Fernandez-Vargas' claim as involving new consequences of past actions rather than vested rights, rendering St. Cyr and similar cases irrelevant. The court compares this situation to employment discrimination cases involving the Civil Rights Act of 1991, notably Yamaguchi v. United States Dep’t of the Air Force, where it was ruled that although some harassment occurred before the effective date of the new act, only conduct after the date could be considered for compensatory damages due to the continuing violation theory. 

Consequently, the court concludes that the continuing violation theory cannot override the presumption against retroactive application of § 1595, aligning with rulings in other circuits that similarly reject recovery for actions occurring prior to the enactment of new civil liability provisions.

1595 does not apply to conduct occurring before December 19, 2003, as retroactive application would be impermissible. There is no legal authority indicating that civil provisions increasing liability for ongoing violations do not have retroactive effects. The court cites its precedent in Yamaguchi to support this conclusion. The district court's ruling that punitive damages are unavailable under the Trafficking Victims Protection Act (TVPA) is reversed, while its finding regarding the non-retroactive application of 1595 is affirmed. The question of whether Boehm's actions after December 19, 2003, violate the TVPA remains to be resolved on remand. Costs on appeal will be borne by the parties.

Dissenting, Circuit Judge Callahan agrees that 1595 does not apply to pre-December 19, 2003 conduct but disagrees with the majority on the availability of punitive damages under 1595. He contends that while punitive damages may be desirable, Congress has not authorized them under this statute. The majority's reasoning relies on common law principles, but Callahan argues that a more nuanced analysis must consider Congress's intent when the statute was enacted. He references the Supreme Court's decision in Smith v. Wade, which allowed punitive damages under 42 U.S.C. 1983, but notes that the context and legislative history differ significantly. Callahan emphasizes that Congress has explicitly included or excluded punitive damages in other legislation, indicating a deliberate approach rather than reliance on common law.

Prior to the Trafficking Victims Protection Act (TVPA), Supreme Court opinions indicated that the authorization of punitive damages in federal statutes was determined by Congressional intent, not common law. The initial drafts of the TVPA in 1999 included provisions for civil actions and punitive damages for violations of 18 U.S.C. § 1589, but the final version, enacted on October 5, 2000, removed these provisions entirely, focusing instead on stronger criminal penalties. President Clinton highlighted the law's intent to create new felony offenses for human trafficking and asset forfeiture for offenders.

In 2003, Congress reconsidered the TVPA to authorize appropriations for fiscal years 2004 and 2005, drafting a civil damages provision that initially included punitive damages. However, the enacted version only allowed for actual damages and reasonable attorneys’ fees, omitting punitive damages. This omission may have stemmed from a Department of Justice (DOJ) letter opposing the creation of a private right of action, suggesting that amending existing laws, like the Racketeer Influenced and Corrupt Organizations Act (RICO), would be more suitable. The DOJ's position indicated that state tort laws already provided sufficient recovery avenues for victims, negating the need for a federal tort under the TVPA.

The DOJ's letter is the sole commentary on punitive damages in the House Report, indicating that Congress partially followed its advice by establishing a private cause of action for damages and attorneys' fees, but explicitly excluded punitive damages. A review of the TVPA's legislative history reveals that in 2003, Congress considered and rejected language for punitive damages when creating this private cause of action. This decision aligns with the precedent set in Wade, which acknowledges the need for clear legislative guidance on damages. Despite reviewing proposals for punitive damages in 2000 and 2003, Congress ultimately decided against including such provisions in the TVPA, suggesting that punitive damages were deemed unnecessary for adequate punishment or compensation. The statute provides for substantial mandatory sentences and restitution for defendants convicted under related provisions, emphasizing that Congress intended to limit civil remedies to compensatory damages and attorneys' fees. This approach adheres to the principle of statutory interpretation that courts should refrain from inferring remedies not explicitly provided by Congress. The legislative history clearly demonstrates Congress's intention to restrict civil remedies under the TVPA, reinforcing the argument against the inclusion of punitive damages.