Supreme Court rules in favor of jewelry store owner in malicious prosecution case

The U.S. Supreme Court on Thursday ruled that a jewelry store owner in Napoleon, Ohio, who was arrested on one baseless charge alongside two charges with probable cause, could sue for malicious prosecution. Police officers for the city arrested the jewelry store owner, Jascha Chiaverini, on misdemeanor charges of receiving stolen goods and dealing with precious metals without a license, as well as a felony charge of money laundering. Prosecutors ultimately dropped the charges against Chiaverini after detaining him for three days.

Chiaverini sued for malicious prosecution, arguing the officers did not have reason to arrest him on the money laundering charge. The district court and appeals court both favored the police officers. The appeals court argued that since two of the charges were based on probable cause, it was unnecessary to prove probable cause for the remaining charge. Thus, Chiaverini was not imprisoned unfairly. The Supreme Court ruled otherwise, saying if even one charge on an arrest warrant is baseless, that provides the arrestee grounds for a malicious prosecution lawsuit.

Did the Supreme Court issue any other opinions today? The court issued three other opinions on Thursday. However, it avoided issuing opinions in cases that had snagged significant media attention, such as former President Donald Trump’s case regarding presidential immunity.

Gonzalez v. Trevino: The court ruled that a city councilwoman in Castle Hill, Texas, had grounds to sue for retaliatory arrest. Sylvia Gonzalez ran for Castle Hill’s city council in 2019 and heard complaints about the city manager while on the campaign trail. After becoming a councilwoman, she circulated a petition calling for the manager’s removal. Eventually, she gained more than 300 signatures and brought the petition to a city council meeting where other council members opposed it.

After the second council meeting day, Castle Hill Mayor Edward Trevino II approached Gonzalez and asked her where the petition was. She said Trevino had it. The mayor denied that and ordered Gonzalez to look inside a binder in her bag. She did so and, to her alleged surprise, found the petition inside the binder. Authorities investigated and charged her with stealing a government document under an anti-tampering statute. She turned herself in after hearing about a warrant for her arrest. Prosecutors ultimately dropped the charges.

Gonzalez sued, claiming authorities arrested her in retaliation for petitioning to remove the city manager and violated her First Amendment rights. She provided data from Bexar County, where Castle Hill is located, showing no one in the past decade had been charged under the anti-tampering statute used against her for allegedly stealing a non-binding or expressive document.

The appeals court ruled that data was insufficient and that Gonzalez would have had to provide historical examples showing that other individuals in her position had committed the same offense and that authorities had chosen not to arrest them. The Supreme Court ruled that it was too high of a burden and that Gonzalez had already proved all she needed to in the data she provided. The court concluded that others likely had committed the offense, and authorities had chosen not to arrest them since the offense’s nature was unheard of.

Diaz v. United States: Border patrol officers stopped petitioner Delilah Diaz at the U.S.-Mexico border and found more than 50 pounds of methamphetamine hidden in her vehicle. Authorities charged her with importing methamphetamine into the United States. That required the government to prove that Diaz knowingly transported the drugs. She argued that she did not knowingly do so.

To prove its case, the government at trial called Homeland Security Investigations Special Agent Andrew Flood to testify as an expert witness. He testified that most people in drug trafficking groups know that they are trafficking drugs. A jury convicted Diaz, but she appealed her conviction on the grounds that Flood’s testimony was improper. The Supreme Court ruled that it was not. For Flood’s testimony to be improper, he would have to be issuing an opinion specifically on the defendant’s mental state—regarding whether she knew that she was transporting the drugs. However, the court found that Flood had merely spoken about the mental state of most members of a general group. As such, the high court ruled his testimony was not improper.

Moore v. United States: Congress treats foreign companies with American shareholders as pass-through entities, meaning that the company does not pay taxes to the U.S. government. Rather, the company’s American shareholders pay the taxes to the U.S. government for the whole corporation—even for company profits that don’t make their way into their pockets.

Charles and Kathleen Moore invested in an American-controlled foreign corporation that reaped significant profits from 2006 to 2017, but none were distributed to American shareholders. As part of its 2017 Tax Cuts and Jobs Act, Congress allowed for a one-time, backward-looking tax on American shareholders of foreign corporations. The Mandatory Repatriation Tax, as the provision was called, ultimately required the Moores to pay almost $15,000 in back taxes on their shares in the company—shares from which they had not yet received dividends. They sued, saying the Mandatory Repatriation Tax violated the Direct Tax Clause of the U.S. Constitution.

The Supreme Court ruled that it did not. It found that the Mandatory Repatriation Tax did not exceed Congress’ constitutional abilities to tax Americans.