The Appellate Strategist : Appellate Lawyers & Attorneys for Updates on Trial Consultations, Amicus Briefs & Punitive Damage Awards

It is not uncommon for a deposition witness testifying regarding critical events to make somewhat inconsistent statements under direct- and cross-examination.  For decades California trial courts have denied summary judgment motions on the ground that such inconsistencies create triable issues of fact that must be resolved by juries.  The lower courts cite two California Supreme Court opinions, Clemmer v. Hartford Insurance Co., 22 Cal.3d 865 (1978) and Reid v. Google, Inc., 50 Cal.4th 512 (2010), for the principle that "the task of disambiguating ambiguous utterances is for trial, not for summary judgment."

In Davis v. Foster Wheeler Energy Corp., __Cal.App.4^th__, 2012 WL 1435016 (2012) [pdf], the California Court of Appeal was asked to reverse a summary judgment entered against the heirs of a refinery worker who had died of asbestos-related disease and in favor of the manufacturer of an industrial boiler that had been insulated with asbestos.  A witness who had worked with the decedent testified under examination by plaintiffs’ counsel that he had witnessed (while working nearby the decedent) the manufacturer’s employees remove asbestos insulation from pipes attached to the boiler, creating dust that was inhaled by the decedent.  Later in the deposition, while being examined by defense counsel, the witness said the opposite; only insulators hired by the refinery had applied and removed asbestos.  He denied having any knowledge that anyone associated with the manufacturer had ever applied or removed asbestos.  The trial judge, having reviewed the testimony of another percipient witness that corroborated the deponent’s second version of the relevant events, granted summary judgment for the manufacturer:  “[N]o reasonable jury considering this opposing testimony would conclude that the [Foster Wheeler] workers are the workers who removed the asbestos insulation around the Foster Wheeler boilers.”

On appeal plaintiffs argued that Clemmer and Reid required reversal.  The Court of Appeal, affirming, disagreed:  “In this case, the testimony is not ambiguous, but is contradictory, and the issue is . . . whether with [the witness’s] internally contradictory testimony plaintiffs established the existence of a triable issue of fact, and on de novo review [citation] we agree with the trial court that it did not.”

Under Davis counsel need not shy away from bringing a summary judgment motion even where there are internal inconsistencies in the testimony, especially where the testimony favorable to the client is consistent with the weight of other evidence submitted for the trial court’s evaluation.

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Last August, the California Supreme Court issued one of those once-in-a-generation opinions that cut a wide swath across many areas of tort law. A 6-1 opinion, Howell v. Hamilton Meats held that personal injury plaintiffs are limited to recovering, as medical special damages, the amount plaintiff’s private health insurer actually paid plaintiff’s medical provider in full satisfaction of the bill for services rendered to treat the personal injury. Plaintiffs cannot recover the face amount that their providers billed if their private health insurers paid less in full satisfaction, e.g., where the health insurer and hospital have a prenegotiated contractual agreement on how much the hospital will accept. Typically, the prenegotiated “discount” – though not really a “discount” at all – is much less than the face amount of the bill.

Though the phrase “landmark decision” is often over-used, Howell is one of those rare opinions that truly deserves the label.   It applies to virtually every type of lawsuit in which the plaintiff who claims personal injury had private health insurance which picked up the tab for plaintiff’s medical services. In other words, Howell governs not merely in the traditional auto accident scenario, but any case in which plaintiff seeks to recover for medical services attributable to the injury defendant caused. Howell limits recovery to the “reasonable value” of the service, capped by the amount the provider accepted as payment in full. Some have estimated that Howell represents a net savings to defendants and their liability insurers of as much as $3 billion per year. Full disclosure: Sedgwick’s appellate department filed one of the amici curiae briefs on which the Supreme Court relied in its Howell decision.

The ink on Howell was hardly dry before a bill was introduced in the California Legislature to overrule it. SB 1528 was sponsored by Senate President Pro Tem Darrell Steinberg for the Consumer Attorneys of California (aka the plaintiffs’ bar.) As introduced in February, the two-paragraph bill declared that injured plaintiffs "shall be entitled to recover the reasonable value of medical services provided without regard to the amount actually paid." [pdf]  In other words, the original version was aimed squarely at legislatively-overruling Howell.

But just a few days ago, the measure took an interesting detour. Proponents deleted all of the language that would have overturned Howell, leaving only a shell that says: “it is intent of the Legislature to establish a framework for compensating persons with injuries due to the fault of third parties.”  [pdf] This, in essence, reduces the measure to a “spot bill” – one that contains no substantive provisions, a placeholder declaring the drafters’ “intent” to establish a compensation “framework” in the future. As Dan Walters, blogging for the Sacramento Bee, describes it: the remaining language is “essentially a blank slate that can move through the process and then be filled in later, perhaps in the crush of the legislative session's final days, with or without a compromise between the warring factions.”

According to California’s official legislative website, a hearing is set for May 8, 2012.

Stay tuned to Appellate Strategist for further reports.

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Last week, two long-standing judicial emergencies in the district courts ended with the Senate’s confirmation of Gregg Jeffrey Costa as a District Court Judge for the Southern District of Texas and David Campos Guaderrama as a District Court Judge for the Western District of Texas. Judge Costa’s seat had been vacant since June 11, 2010, and Judge Guaderrama’s since February 26, 2009. Nevertheless, judicial emergencies remain in effect with respect to thirty district court judgeships and seven Circuit Court judgeships.

These emergencies are not solely the result of a slow-moving nomination and confirmation process. Congress has failed for a generation to keep up with the fast-growing dockets in the Federal courts. In the district courts, the number of cases per judgeship increased 30% between 1993 and 2010 – from 407 cases per judgeship to 528.  In 1993, 264,038 cases were pending in the district courts; in 2010, 359,594 cases were pending. During that same period, Congress authorized 35 new permanent District Court judgeships – an increase of only 5.5 percent [pdf].

The Circuit Courts are stretched equally thin. In 1993, 48,474 cases were pending in the Circuits – an average of 290 per judgeship. In 2010, 56,790 cases were pending – an average of 340 per judgeship, and an increase of 17 percent. The number of new permanent Circuit judgeships authorized by Congress during that period? Zero [pdf].

Federal judges see the harm done by this crisis firsthand. “I have my own standards,” said Chief District Judge B. Lynn Winmill of the District of Idaho late last year, “but it’s getting very, very hard to meet my standards. I want to have my decisions out in 30 days. Historically, I’ve done OK – until last year.” “Civil litigation has ground to a halt,” said Chief Judge Michael McCuskey of the Central District of Illinois in a Wall Street Journal interview. “You’ve got a right to sue but you do not get a right to a speedy jury trial.” In 1997, Judge McCuskey’s district had 55 civil cases which had been pending more than three years. In 2010, that backlog had grown to 1,200. “Ultimately, I think people will lose faith in the rule of law,” Chief Judge Alex Kozinski of the Ninth Circuit told the Washington Post. “We as a nation believe that if you have a dispute, you go to court and within a reasonable period of time, you get a decision.” During a panel at the Brookings Institution, Judge W. Royal Furgeson voiced his frustration with his overcrowded criminal docket:

I would sometimes look out in the evening at the mass of people assembled in my courtroom and it would take me back to the days when I was a very young lawyer and my firm was assigning me to handle clients in night traffic court . . . The problem, of course, in night traffic court is if my client got fined it was going to be a couple of hundred bucks at the most, and the problem I had with the defendants before me, they were looking at years – potentially years and years in a federal prison.

The four longest-standing judicial emergencies in the Circuit Courts are:

• The Ninth Circuit: This court currently has 822 adjusted filings per judgeship. Like nine other Circuits, the Ninth reduced its total number of appeals pending as of the end of 2011, with terminations outpacing new filings, but 13,913 appeals still remained on the docket [pdf]. Judge Stephen S. Trott took Senior status on December 31, 2004. There is no nominee from the White House.
   
• The Ninth Circuit: This new vacancy was created by Pub. L. No. 110-177, which transferred one authorized judgeship from the District of Columbia Circuit to the Ninth Circuit effective January 21, 2009. On February 24, 2010, President Obama nominated now-Associate Justice Goodwin H. Liu of the California Supreme Court to this seat, but Justice Liu asked that his name be withdrawn from consideration on May 25, 2011. Judge Jacqueline H. Nguyen of the United States District Court for the Central District of California was nominated for the seat on September 22, 2011.
   
• The Seventh Circuit: This Court currently has 522 adjusted filings per judgeship. As of the end of 2011, 1,933 appeals were pending [pdf]. Judge Terence T. Evans took Senior status on January 7, 2010, and passed away on August 10, 2011.  Professor Victoria F. Nourse of the University of Wisconsin Law School was nominated for the seat by President Obama on July 14, 2010.  On January 18, 2012, after her nomination was returned to the President by the Senate, Professor Nourse requested that her name be withdrawn from consideration.  There is no new nominee from the White House.
   
• The Eleventh Circuit: This Court currently has 985 adjusted filings per judgeship. As of the end of 2011, 3,546 appeals were pending [pdf]. Judge Stanley F. Birch Jr. retired on August 29, 2010. President Obama nominated Jill A. Pryor to the seat on February 16, 2012. 

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Yesterday the Illinois Supreme Court published its Oral Argument Calendar [pdf] for the May term, and the Court will hear oral argument in eight civil cases. The cases, with the issue or issues presented in each, are:

May 22:

Moore v. Chicago Park District, No. 112788 – Does an unnatural accumulation of snow and ice constitute the 'existence of a condition of any public property' as this expression is used in Section 3-106 of the Tort Immunity Act? See Tort Law.

Wilson v. Edward Hospital, No. 112898 – Are actual agency and apparent agency separate claims for purposes of the res judicata doctrine and the prohibition against claim-splitting set forth by the Supreme Court in Hudson v. City of Chicago, 228 Ill.2d 462 (2008) and Rein v. David A. Noyes & Co., 172 Ill.2d 325 (1996), so that summary judgment entered on the actual agency claims in plaintiffs’ initial suit bars plaintiffs’ apparent agency claims in a refiled suit, even in the face of a ruling that there is a question of fact as to the apparent agency claims? See Tort Law.

Rush University Medical Center v. Sessions, Nos. 112906/112993 – Does the doctrine holding that self-settled spendthrift thrusts are revocable per se survive the enactment of the Fraudulent Transfer Act? See Trusts and Estates.

Choate v. Indiana Harbor Belt Railroad Co., No. 112948 -- (1) Does a defendant landowner have a duty of due care with respect to a nearly thirteen-year old injured while trying to jump aboard a slow-moving train on the landowner's tracks? (2) Was the expert opinion presented by plaintiff sufficient to support the jury's verdict on the grounds that improvements were reasonably practicable and would have prevented the accident? See Tort Law.

May 23:

Carter v. SSC Odin Operating Co., No. 113204 – (1) Is an agreement mandating arbitration of all claims for more than $200,000 arising out of nursing home claims void for lack of mutuality on the grounds it is illusory? (2) Is an agreement to arbitrate applicable to a wrongful death claim where plaintiff signed the agreement only in the status of decedent's "legal representative"?  See Arbitration.

Martin v. Keeley & Sons, Inc., No. 113270 – Where the I-beam on a bridge the plaintiffs were constructing collapsed and fell, did the plaintiffs state a triable issue of fact on (1) the "relationship" prong of duty to preserve evidence, and (2) the "foreseeability" prong of the duty, meaning that a reasonable person would have foreseen that the beam was material to a potential civil action?  See Tort Law.

Country Preferred Insurance Co. v. Whitehead, No. 113365 – Is the provision of an Illinois automobile insurance policy imposing a two-year statute of limitations on uninsured motorists claims invalid as against public policy with respect to an accident which occurred in Wisconsin, where the statute of limitations for uninsured motorist claims is three years?  See Insurance.

In re Marriage of Coulter (Coulter v. Trinidad) – No. 113474 – May a trial court deny a petitioner's request for a preliminary injunction barring removal of the couple's minor children, pending a full hearing, where the parties had previously agreed that the wife could remove the children from the state at any time after 36 months from entry of judgment? See Domestic Relations.

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The Illinois Supreme Court has announced that on the morning of Thursday, April 19, it will file an opinion in one civil case [pdf]:

• Santiago v. E. W. Bliss Co., No. 111792 – When an injured plaintiff intentionally files a complaint using a fictitious name, without leave of court as provided in 735 ILCS 5/2-401, and subsequent to the expiration of the statute of limitations, files an amended complaint with the correct plaintiff’s name, should the court dismiss with prejudice as a sanction, or because the limitations period has expired and the amended complaint does not relate back to the original filing? See Civil Procedure.

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The California Supreme Court has issued a resounding and conclusive opinion rejecting the surging liability theory that a product manufacturer may be held liable for harmful defects in products made by third parties unless the manufacturer’s own product contributed substantially to the harm, or the manufacturer participated substantially in creating a harmful combined use of the products.

The Court’s unanimous opinion in O’Neil v. Crane Co. – issued Thursday – slammed the door on plaintiffs’ attempt to create “an unprecedented expansion of strict products liability,” and reaffirmed the “bedrock principle” that strict liability is premised on harm caused by deficiencies in the defendant’s own product.

The plaintiffs in O’Neil had postulated that the defendant valve and pump manufacturers should be liable for the harm caused by the plaintiff’s exposure to asbestos-containing insulation products (made by others) that were used on or near the defendant’s all-metal products. However, there was no evidence that asbestos insulation – as opposed to some other type of insulation material – was necessary for the defendants’ pumps and valves to function properly.

A product’s “mere compatibility for use” or even its foreseeable use with defective components is not enough to render the defendant’s product itself defective. The Court noted the absurdity that would follow recognition of plaintiffs’ liability theory. Manufacturers of the saws and tools used to cut and remove asbestos insulation would become the next targets in asbestos litigation. And taken to its logical extreme, match manufacturers might be required to warn about the hazards of dynamite.

“The broad rule plaintiffs urge would not further the purposes of strict liability. Nor would public policy be served by requiring manufacturers to warn about the dangerous propensities of products they do not design, make, or sell,” wrote Justice Corrigan, writing for the unanimous Court. A manufacturer of a non-defective product is unable to exert pressure on other manufacturers to make their products safe. Additionally, manufacturers of non-defective products should not shoulder a burden of liability for products, the sale from which they derived no economic benefit. Nor should strict liability require manufacturers to investigate the potential risks of all other products and replacement parts that might foreseeably be used with their own product and warn about such risks. This “unrealistic” and “excessive” burden would actually undermine consumer safety by inundating users with excessive warnings.

The Court did not expressly opine on, but rather left open the possibility of liability in the case of a product that requires the use of a defective product in order to operate, or if a product manufacturer specifies or requires the use of a defective replacement part. However, the Court noted that in both contexts, “the policy rationales against imposing liability on a manufacturer for a defective part it did not produce or supply would remain.” 

Now that two state Supreme Courts – California and Washington (see Braaten v. Saberhagen Holdings (2008) 165 Wn.2d 373,and Simonetta v. Viad Corp. (2008) 165 Wn.2d 341.) – have recently rejected this proposed expansion of products liability law in the asbestos context, expect that many other jurisdictions will follow and cap this emerging theory.

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The California Supreme Court heard oral argument in O’Neil v. Crane Co. The Court’s decision will likely define an important area of strict products liability law in California – specifically, it will expand or limit the duty of product manufacturers to warn about the hazards of replacement parts made by others that are subsequently incorporated by the purchaser into the manufacturer’s original product. 

O’Neil arises out of the plaintiff’s exposure to asbestos-containing gaskets and packing materials used in and around the defendants’ valves and pumps, which were incorporated by the Navy into the steam propulsion system aboard the USS Oriskany, where the plaintiff served while he was enlisted. Though the pumps and valves delivered to the Navy originally incorporated asbestos-containing gaskets and packing, all parties agreed that by the time plaintiff served aboard the Oriskany, the original asbestos packing and gaskets had been removed and replaced with packing and gaskets manufactured by third parties. Nevertheless, the plaintiff argued the pump and valve manufacturers had a duty to warn him regarding the hazards of asbestos.  

Prior to O’Neil this legal issue had been addressed by the California Court of Appeal, most notably in Taylor v. Elliot Turbomachinery Co., Inc. (2009) 171 Cal. App. 4th 564. There, the First Appellate District noted, on facts indistinguishable from the present case, that the plaintiff’s injury did not come from the defendants’ equipment itself, but instead was released from products made or supplied by other manufacturers, though used in conjunction with the defendants’ equipment. Thus, the defendant manufacturers were not part of the chain of distribution of the injury-causing product, which was actually the asbestos-containing insulation. The court held that California law did not recognize a duty to warn of defects in another manufacturer's product.  The Second District Court of Appeal below in O’Neil rejected the reasoning of Taylor, and instead ruled that a manufacturer is strictly liable for dangerous products with which its product will necessarily be used. The Supreme Court granted certiorari in O’Neil to resolve the conflict between the O’Neil and Taylor decisions.

At oral argument, one of the Justices’ primary concerns appeared to be factual in nature: What exactly was meant by the parties’ contention that the Navy “specified” or “required” the use of asbestos-containing insulation? As phrased by Chief Justice Cantil-Sakauye, did the Navy “say the magic word, ‘asbestos’” in its specifications to the defendants, or did the Navy merely promulgate performance specifications and the defendant manufacturers independently determined that asbestos-containing insulation was the best (or even only) material suitable to meet those requirements?  

Another significant concern of the Court appeared to be whether the pumps and valves were capable of functioning without the asbestos-containing components. In other words, was asbestos required for the pumps and valves to function properly, or was asbestos merely required by the dictates of the steam propulsion system, and not the design of the valves or pumps themselves. The Court seemed troubled settling on the proposition that the pumps and valves could be deemed defectively designed if the pumps and valves were “asbestos neutral,” and could function just as well in other systems utilizing non-asbestos containing materials. 

Ultimately this latter point may be where the court draws the line, assigning a duty to warn about replacement parts made by others only if the replacement part is identical to the original hazardous part, and the replacement part is essential to the function of the defendant’s product. The Court will issue its opinion within 90 days. 

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The Illinois Supreme Court has announced that on the morning of Thursday, October 27, it will file opinions in two civil cases [pdf]:

• A.B.A.T.E. v. Giannoulias, No. 110611 -- Does a state statute permitting the transfer of funds from the Cycle Rider Safety Training Fund to the General Revenue Fund violate the Takings Clause of either the federal or state constitutions? See Constitutional Law.
   
• Sierra Club v. Illinois Pollution Control Board, No. 110882 -- (1) Does a petitioner in an individual adjusted standard proceeding before the Illinois Pollution Control Board have a burden of proof with respect to the standards set forth in Section 27(a) of the Illinois Environmental Protection Act? (2) Must the Board make written findings or identify substantive evidence supporting its resolution of the Section 27(a) factors in such a proceeding? (3) Do environmental activist groups have standing to seek judicial review of the Board’s decision in an individual adjusted standard proceeding? See Government Law.

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Witnesses called to testify as “experts” are cloaked with prestige and authority, and positioned to exert heavy influence on juries. This is accentuated with areas of expert testimony that are highly technical or specialized. The U.S. Supreme Court recognized in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 595 (1993), that “[e]xpert evidence can be both powerful and quite misleading because of the difficulty in evaluating it.”  

In Daubert, the United States Supreme Court created a seismic shift in the test for the admissibility of expert testimony. Daubert held that Congress’ adoption of the Federal Rules of Evidence displaces the general acceptance test and requires the federal trial judge to ensure that any expert testimony admitted is both reliable and relevant. The Court has also clarified that an expert’s conclusions are not beyond the reach of the relevance/reliability test, and that the relevance/reliability test is not limited to the “scientific” and applies to all expert testimony. The Court has therefore given federal trial court judges the important responsibility of ensuring that expert testimony is based on reliable methodology and fits the facts of the case.

Florida, on the other hand, is among a shrinking minority of states still clinging to the antiquated Frye test. See Frye v. United States, 293 F. 1013, 1013-14 (D.C. Cir. 1923). This test does not provide trial judges with the legal tools for ensuring that “expert” witnesses are qualified and that their testimony is relevant, reliable and appropriate for a jury. Instead, the “test” is nothing more than a determination whether an expert’s methodology is “generally accepted.” This nebulous standard of “general acceptance” is not an adequate check on the integrity of expert evidence. The problem is compounded by Florida Supreme Court precedent holding that the Frye test applies only to a minority of cases involving expert testimony – those involving “new science.” If an expert’s testimony is based on science that the court does not deem “new” or derived from a field that is not traditionally “science,” then the test is not even triggered. So-called “pure opinion” testimony purportedly based on an expert’s overall experience is also beyond the reach of the Frye test.

This shortcoming in Florida jurisprudence undermines the integrity of the court system and quality of justice dispensed by trial courts. It also threatens to diminish the State’s many advantages in attracting business, particularly in light of the fact that most states in the Southeast have already modernized their laws governing the admissibility of expert evidence, including  Georgia by legislation enacted in 2005 and North Carolina by legislation effective as of October 1, 2011.

The Florida Legislature can and should solve this problem by statutorily adopting Daubert to place Florida on equal footing with most other jurisdictions and federal courts.

[Robert C. Weill has co-authored a full-length article advocating for the Florida Legislature’s adoption of Daubert which will be published in the Nova Law Review in February 2012.]

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This afternoon the Illinois Supreme Court published its Oral Argument Calendar [pdf] for the September term, and the Court will hear oral argument in ten civil cases. The cases, with the issue or issues presented in each, are:

September 20:

Simpkins v. CSX Corporation, No. 110662 -- Does an employer owe a tort duty of due care to the immediate family of its employees? See Tort Law.

The Forest Preserve District of Du Page County v. First National Bank of Franklin Park, No. 110759 & 110760 -- (1) Has a plaintiff negotiated in good faith prior to filing a complaint for condemnation where it fails to offer the full amount of the highest appraisal it receives, fails to attach an appraisal to its offer letter and adds a short time-frame for acceptance to its offer? (2) Are clauses in Annexation Agreements providing that zoning and Special Use Designations survive the expiration of the agreement contrary to Illinois law? (3) Is Section 7-121 of the Eminent Domain Act, which provides that fair market value in a condemnation proceeding shall be determined as of the date the action was filed, unconstitutional as applied under Kirby Forest Industries v. United States, 467 U.S. 1 (1984)? See Government Law.

Wisnasky-Bettorf v. Pierce, No. 111253 -- Under Section 7-61 of the Illinois Election Code, 10 ILCS 5/7-61, must an established political party timely file a resolution with the appropriate official in order to fill a vacancy in nomination when no candidate appeared on the primary ballot for that party or ran as a write-in candidate? See Election Law.

September 21:

Citizens Opposing Pollution v. ExxonMobil Coal U.S.A. – Nos. 111286 & 111304 -- Does either the Surface Coal Mining Land Conservation and Reclamation Act, 225 ILCS 720/1.01 et seq., and/or the Water Use Act of 1983, 525 ILCS 45/1, permit a private right of action for enforcement? See Civil Procedure.

Sandholm v. Kuecker – No. 111443 -- (1) Is the Illinois Citizen Participation Act, 735 ILCS 110/1, unconstitutional, either on its face or as applied? (2) Is the attorneys fees provision of the Act limited to fees incurred in moving to dismiss under the Act?  See Constitutional Law.

The Township of Jubilee v. The State of Illinois – No. 111447 -- Does the State’s filing of a counterclaim, after its motion to dismiss has been denied, waive a claim of sovereign immunity? See Government Law.

Crossroads Ford Truck Sales, Inc. v. Sterling Truck Corporation – No. 111611 -- (1) Are claims brought under Section 4(d)(6) of the Franchise Act, 815 ILCS 710/4(d)(6), within the exclusive jurisdiction of the New Motor Vehicle Review Board? (2) Did the plaintiff otherwise state claims for relief under the Franchise Act? See Contract Law.

September 22:

Santiago v. E.W. Bliss Company – No. 111792 -- When an injured plaintiff intentionally files a complaint using a fictitious name, without leave of court as provided in 735 ILCS 5/2-401, and subsequent to the expiration of the statute of limitations, files an amended complaint with the correct plaintiff’s name, should the court dismiss with prejudice as a sanction, or because the limitations period has expired and the amended complaint does not relate back to the original filing? See Civil Procedure.

Nowak v. The City of Country Club Hills – No. 111838 -- May an injured public employee simultaneously collect the benefits provided under the Public Employee Disability Act, 5 ILCS 345/1, as well as the health benefit provided by Section 10(a) of the Public Safety Employee Benefits Act, 820 ILCS 320/10(a)? See Government Law.

Reliable Fire Equipment Co. v. Arredondo – No. 111871 -- What is the appropriate standard for determining whether an employer has a protectable interest in its customer list such that a non-compete clause in an employment agreement is enforceable? See Employment Law.

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Adding its voice to a continuing national debate, the California Supreme Court has adopted the minority rule and held that tort damages for past medical expenses are limited to those amounts actually paid and accepted as full payment for the services provided, when such amounts are determined by an existing agreement with the plaintiff’s insurance carrier. In such a case, an amount otherwise “billed” using rates outside of the agreement is irrelevant. In its opinion, the Court explained that only the prenegotiated amount actually paid by, or on behalf of, the plaintiff to settle a previous medical bill is recoverable as economic damages, because such a payment is the extent of plaintiff’s actual loss. As a result, the collateral source rule does not apply, because the issue is the measure of plaintiff’s actual damages, not how they were paid. The Court noted that, to be recoverable, such damages must be both reasonable and actually incurred. While acknowledging that this could result in wildly different damages for the same injury, depending on whether the plaintiff was insured, this does not change the measure of a particular plaintiff’s damages. The Court noted a similar disparity in lost income damages between different plaintiffs with identical injuries. There were several amicus briefs filed in this matter, including one prepared by Sedgwick. For more details about Howell, see the Damages update page.

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Governor Jerry Brown has acted to fill the California Supreme Court vacancy created by the retirement earlier this year of Associate Justice Carlos R. Moreno by nominating U.C. Berkley law professor Goodwin Liu to the post. 

Professor Liu, 40, has never been a judge, but recently garnered headlines as President Obama’s nominee for a seat on the U.S. 9^th Circuit Court of Appeals. His confirmation was blocked by Senate Republicans, citing his legal philosophy and despite support from prominent legal conservatives Kenneth W. Starr and Richard Painter. He ultimately withdrew his nomination. 

Professor Liu is the son of Taiwanese immigrants. He was born in Georgia, but raised in Sacramento where, according to his CV, he attended public schools. He graduated Stanford in 1991 with a bachelor’s degree in biology, then went to Oxford on a Rhodes scholarship, where he took a masters degree in philosophy and physiology. “Upon returning to the United States, he went to Washington, D.C., to help launch the AmeriCorps national service program and worked for two years as a senior program officer at the Corporation for National Service.” 

Professor Liu’s career in the law began upon graduation from Yale Law School in 1998, whereupon he clerked for Judge David Tatel of the U.S. Court of Appeals for the District of Columbia Circuit. He then worked “as Special Assistant to the Deputy Secretary of the U.S. Department of Education, where he developed and coordinated K-12 education policy.” A U.S. Supreme Court clerkship with Justice Ruth Bader Ginsburg followed, then a stint in O’Melveny & Myers’ appellate litigation practice in Washington, D.C. Since joining the Boalt Hall faculty in 2003, he has ascended to the rank of Associate Dean and Professor of Law while establishing himself as a nationally recognized expert on constitutional law, education policy, civil rights, and the Supreme Court. 

He is also a prolific and influential legal scholar. Some of his more recent publications include:

• Keeping Faith With The Constitution (2009) (with Pamela S. Karlan and Christopher H. Schroeder);
   
• The Bush Administration and Civil Rights: Lessons Learned, 4 Duke Journal of Constitutional Law & Public Policy 77 (2009);
  
• National Citizenship and the Promise of Equal Educational Opportunity, in The Constitution in 2020 (Jack M. Balkin & Reva B. Siegel eds., 2009);
  
• Rethinking Constitutional Welfare Rights, 61 Stanford Law Review 203 (2008).

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In a day and age when every other day there seems to be a sex scandal involving a politician’s “indiscretions,” the Florida Supreme Court has been asked to examine a legal issue arising out of an alleged sex scandal. In DelMonico v. Traynor, No. SC10-1397, the Court must determine whether an attorney is protected by the litigation privilege against claims for defamation and tortious interference when he related to another party’s ex-spouses and former business associates during witness interviews that the party used prostitutes to entice business clients. The Court accepted the case for review based on conflict with the Court’s prior decision in Levin, Middlebrooks, Mabie, Thomas, Mayes & Mitchell P.A. v. U.S. Fire Insurance Co., 639 So. 2d 606 (Fla. 1994). The district court’s decision is reported at 47 So. 3d 1287 (Fla. 4th DCA 2010), and the slip opinion can be found here. The Court heard oral argument on June 9, 2011.

The District Court’s Decision. The district court affirmed the application of the privilege to bar the claims against the attorney and his law firm. Over the dissent of one judge, the district court held that “[b]ecause the statements complained of were made by the [attorney] while he was acting as defense counsel in the underlying litigation, and the statements bore ‘some relation’ to the proceeding, they were absolutely privileged as a matter of law.” 

The dissent, on the other hand, questioned whether a qualified, rather than absolute, privilege applied since the attorney’s defamatory statements targeted a person outside a “judicial proceeding.”  It then concluded that disposition by summary judgment was not appropriate because “there remain disputed issues of material facts as to whether the attorney made the statements and whether they were made with the intent to injure the appellant.”

Review before the Florida Supreme Court. The Florida Supreme Court accepted review of the case based on express and direct conflict with its decision in Levin Middlebrooks which held that “absolute immunity must be afforded to any act occurring during the course of a judicial proceeding, regardless of whether the act involves a defamatory statement or other tortious behavior . . . so long as the act has some relation to the proceeding.” Petitioners asserted that the district court’s holding conflicted with Levin Middlebrooks “by applying an absolute privilege to statements defaming a party outside of a judicial proceeding, at a time when the defamed party and/or his lawyer are not present, not provided an opportunity to be heard, and not able to have any judicial recourse because the defamatory statements are not made in the ‘course of the judicial proceeding.’”

In sum, the issue before the Court turns on the meaning of the phrase “course of judicial proceeding.” Does the “course of judicial proceedings” requirement become non-issue once a lawsuit is filed? Does it sweep into its net comments made during potential witness interviews outside the presence of the defamed party or a judge? Does the term require that the statements be made during a formal discovery process (e.g., deposition, answer to interrogatories), a court filing, or in open court? In the end, the Court will have to balance “the chilling effect on free testimony” versus “the right of an individual to enjoy a reputation unimpaired by defamatory attacks” based on the facts of this case.

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Under respondeat superior, an employer is held vicariously liable for the acts of an employee when driving a vehicle within the scope of employment, irrespective of any fault by the employer. Alternatively, an employer can be directly liable for its own negligence under the theory of negligent hiring/retention or negligent entrustment. As a practical matter, a plaintiff injured by the driving employee can allege all such theories; however, does that remain true once the employer admits liability under respondeat superior?

In Armenta v. Churchill (1954) 42 Cal.2d 448 (Armenta), the California Supreme Court held that once an employer admits liability under respondeat superior for an employee driver, the plaintiff is then barred from also pursuing a claim of negligent entrustment. The Court concluded that these were merely two alternative theories for holding an employer liable for the same injury. Under the “all of nothing” principles then in place, an employer would either be held for 100% of the damages, or none at all, regardless of the theory used. However, since Armenta, California has adopted comparative negligence principles and voters enacted Proposition 51, creating mechanisms for parsing out the separate liability of each party involved. As a result, the courts of appeal split as to the continuing viability of Armenta, with the Court of Appeal in Diaz finding that Proposition 51 required a separate evaluation of the employer’s direct liability.

In Diaz v. Carcamo (2011) ___ Cal.4th ___, S181627, the unanimous Supreme Court has resolved the conflict below and upheld Armenta, noting that this remained the majority rule in the U.S. The Court first dismissed the purported distinction between a claim of negligent entrustment (Armenta) and negligent hiring (Diaz), noting these were “functionally identical” when addressing an employee driver. The Court also found it made no difference whether the employer conceded vicarious liability before or during trial. As to the main issue, the Court sided with Jeld-Wen, Inc. v. Superior Court (2005) 131 Cal.App.4th 853, finding that the employer’s liability cannot exceed that of the employee driver who allegedly caused the accident, and that nothing in the development of negligence principles since Armenta had changed this. As a result, once vicarious liability for the employee is conceded, making the employer fully liable for the employee’s actions, the additional claims of negligent entrustment or negligent hiring become duplicative and superfluous and must be barred. Indeed, the Court noted the inherent inequity of holding the employer for a second share of liability in excess of the negligent driver’s liability, and remanded for a full retrial. For more details about Diaz, see the Torts & Products update page.
 

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The Illinois Supreme Court has announced that on the morning of Thursday, June 16, it will file opinions in four civil cases [pdf]:

• Studt v. Sherman Health Systems, No. 108182-- Does the Illinois pattern jury instruction on professional negligence (Civil No. 105.01) correctly state the applicable standards? See Tort Law.
   
• Sheffler v. Commonwealth Edison Co., No. 110166-- Does a complaint seeking both injunctive relief and damages in connection with defendant’s alleged failure to timely restore power after storms, and to give priority in restoring power to customers dependent on electric life support system, fall within the exclusive jurisdiction of the Illinois Commerce Commission? See Tort Law.
   
• Genius v. County of Cook, No. 110239-- Does the Cook County Employee Appeals Board have jurisdiction to decide disciplinary charges against an officer based on abolished rules? See Government Law.
   
• Snyder v. Heidelberger – No. 111052 -- Does a quitclaim deed intended to create a joint tenancy between a husband and wife cause an injury within the meaning of the statute of repose for legal malpractice actions, 735 ILCS 5/13-214.3, when the deed is executed and recorded, when the husband dies and the alleged error can no longer be rectified, or both? See Tort Law.

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In the blog posting dated March 25, 2011, the author discussed the Florida Supreme Court’s review of Cevallos v. Rideout, No. SC09-2238, where the Court will determine how, or if, the rebuttable presumption that a rear-driver was the sole, proximate cause of a rear-end collision applies when the rear-driver was the plaintiff. No decision has been released yet. However, the Florida Supreme Court may further clarify the scope of the presumption in Birge v. Charron, No. SC10-1755 (review granted May 13, 2011), which was the basis for the supreme court’s conflict review of Cevallos. See Charron v. Birge, 37 So. 3d 292 (Fla. 5th DCA 2010). Birge presents the additional issue of whether the rear-end collision presumption applies where a passenger in the following vehicle sues the lead driver for negligence. The supreme court will not hold oral argument on this new case.

The Charron court held that the presumption does not apply when a rear-vehicle passenger sues the lead driver for his negligence. The district court’s succinct reasoning was grounded on principles of contributory negligence; specifically, even under Florida’s now defunct contributory negligence rule, a passenger in the rear vehicle was entitled to pursue all potential tortfeasors, including the forward drivers, in a rear-end collision. 

The Charron decision on this point, though, appears to conflict with other district court decisions. For example, the Fourth District in Marcellus v. Cronan, 963 So. 2d 364 (Fla. 4th DCA 2007), held that the passenger in a lead vehicle who sued the driver of a rear vehicle could not avail herself of the presumption because the lead vehicle may have been improperly parked or stopped on shoulder of roadway at time of accident. To the same effect is the decision in Keyser v. Brunette, 188 So. 2d 840 (Fla. 2d DCA 1966), where the Second District held that the plaintiff, who was passenger in a vehicle struck by the defendant, could not rely on the presumption because the circumstances of the accident “clearly dissipated” it. Id. at 841. On the other hand, in Kimenker v. Greater Miami Car Rental, Inc., 115 So. 2d 191 (Fla. 3d DCA 1959), the Third District held that plaintiffs, who were passengers in a vehicle struck from behind by defendant, were entitled to a directed verdict on liability based on the presumption which the defendant had not rebutted with “substantial evidence.” Id. at 192.

Charron seems to be at odds with Marcellus, Keyser and Kimenker. If a rear-vehicle passenger is immune from the presumption when a plaintiff (i.e., he or she should not be penalized by the driver’s negligence), then it would seem unfair to prevent a lead-vehicle passenger from asserting the presumption by virtue of the lead driver’s negligence.

The Appellate Strategist is currently tracking the status of this case and provides periodic updates on the link to the pending Florida Supreme Court cases. Once a decision is released, it will be linked there.

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The Texas legislature has recently passed civil justice reform legislation. While most of the publicity concerning the legislation focused on the “loser pays” provisions, other changes also deserve note.

The new statutes permit an interlocutory appeal of a ruling on a controlling legal issue where such an appeal is approved by the trial court and accepted by the appellate court. The procedure is essentially the same as in federal cases. Texas previously allowed such interlocutory appeals only where all the parties agreed to appellate jurisdiction. This greatly limited the number and effectiveness of interlocutory appeals.

The legislature also directed the Texas Supreme Court to enact rules to implement a motion-to-dismiss practice. Until now, Texas did not have an efficient mechanism for attacking substantive deficiencies in the pleading. Apparently, the legislature contemplates a procedure similar to Federal Rule of Civil Procedure 12. The introduction of the motion to dismiss practice represents a radical departure for Texas practice.

These changes continue a trend in Texas law. Texas law is increasingly becoming “federalized.” The features that make Texas law “unique” or “quirky” or “loco” (depending on one’s perspective) are gradually being eliminated.

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Appellate Strategist’s survey of potential nominees to the California Supreme Court  begins with Mariano-Florentino Cuellar. Cuellar graduated from Calexico High School in Calexico, California. After earning a bachelor’s degree from Harvard in 3 years (magna cum laude, 1993), he received a Master’s degree in political science from Stanford in 1996, followed by a law degree from Yale in 1997, and a Ph.D. from Stanford in 2000. He then served as law clerk to Chief Judge Mary M. Schroeder of the United States Court of Appeals for the Ninth Circuit. 

Since the culmination of his clerkship in 2001, Cuellar has been a professor at Stanford Law School, first as an Assistant/Associate Professor and then, since June 2007, as a Full Professor and Deane F. Johnson Faculty Scholar. According to his faculty biography, his work at Stanford involves “the intersection of law, public policy, and political science.” His courses deal with issues of administrative law, regulation and bureaucracy, executive power, and national security. 

Professor Cuellar’s tenure at Stanford has included governmental, as well as academic, endeavors. In fact, even before he assumed his faculty position at Stanford, he interrupted his Ph.D. program to serve as Senior Advisor to the Under Secretary (Enforcement) of the Treasury from 1997 to 1999, in which role he focused on financial crime enforcement, terrorism financing countermeasures, immigration, and border security. In 2008 and 2009, he served as Co-Chair of the Immigration Policy Working Group for the Obama-Biden Transition Project, where he worked to formulate policies on immigration, borders, and refugees. In 2009 and 2010, he served as Special Assistant to the President for Justice and Regulatory Policy, in which role he led the White House Domestic Policy Council’s work on criminal justice and drug policy; civil rights and liberties; immigration, borders, and refugees; public health and safety; rural development and agriculture policy; and regulatory reform.

Beyond Stanford, Professor Cuellar is associated with the Council on Foreign Relations, the American Bar Association, the American Law Institute, the American Constitution Society, the La Raza Lawyers’ Association of California, and the National Hispanic Bar Association, among others. He is married to former Santa Clara County Superior Court Judge Lucy H. Koh, who is now a federal district court judge for the Northern District of California pursuant to an appointment by President Obama.

Because Cuellar has not served on the bench, his views on topics that might come before the Court must be gleaned from his writings and appearances in the media. A brief sampling of his academic writing is heavy on federal matters:

• Mariano-Florentino Cuellar, The Political Economies of Criminal Justice, 75 U. Chi. L. Rev. 941 (2008) (responding to the proposition that politicians increasingly govern by framing social policy choices as criminal justice problems, and concluding that “reshaping the [crime-governance connection] to achieve more defensible social goals is a subtle enterprise. Sensible changes in criminal justice could almost certainly yield an acceptable social equilibrium less dependent on incarceration.”)
  
• Mariano-Florentino Cuellar, Auditing Executive Discretion, 82 Notre Dame L. Rev. 227 (2006) (proposing an audit framework similar to “sample adjudication of class action” in lieu of the deferential or non-existent judicial review of executive decision-making and concluding “(1) Judicial review fails to constrain a broad range of discretionary executive decisions subject to mistakes or malfeasance. (2) The limitations of traditional judicial review do not imply that discretionary executive branch decisions should be immune from some form of review. (3) Arguments for broad executive discretion are often radically underdeveloped and fail to withstand scrutiny.”)
  
• Mariano-Florentino Cuellar, The International Criminal Court and the Political Economy of Antitreaty Discourse, 55 Stanford L. Rev. 1597 (May 2003) (arguing that the United States objects to the ICC on “process-oriented” grounds because a “focus on procedure sounds marginally more principled to international audiences than a brute realist assertion that American interests are best served by keeping unfettered control of military decisions.” “Yet this comes with costs: It elides the debate over the value of the brute realist position that American military power should be subject to few meaningful constraints and instead makes it look like the most important question is about the procedural shortcomings of a court that is precisely meant to address the arbitrariness in international criminal justice that critics use to assail it.”)

Professor Cuellar’s appearances in the media have often revolved around his role in shaping the Obama Administration’s immigration policy. His appointment to President Obama’s Immigration Policy Working Group was interpreted by experts as confirmation that President Obama was committed to comprehensive immigration reform.  Moreover, both the National Council of La Raza and the League of United Latin American Citizens greeted Professor Cuellar’s appointment with approval.

Though economic factors have put the immigration debate on the back burner, President Obama’s recent attempt to jump-start the issue suggests that his need for Professor Cuellar’s services may become more pressing in the near future. Whether that impacts Governor Brown’s appointment, or Professor Cuellar’s willingness to serve, remains to be seen.

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 The Illinois Supreme Court has announced that on the morning of Thursday, May 19th, it will file opinions in four civil cases (pdf):

• General Motors Corporation v. Pappas, No. 108893-- (1) Does the 2005 amendment to the Property Tax Code, 35 ILCS 200/23-20, providing for the payment of interest on property tax refunds at the lower of 5% or the percentage increase in the urban CPI for the previous year, apply prospectively only? (2) Did trial court retain jurisdiction to grant judgment interest after the notice of appeal was filed? See Taxation.
   
• O'Brien v. O'Brien, No. 109039 -- (1) Does the standard set in 735 ILCS 5/2-1101(a)(3) for a motion for substitution of a judge for cause, which requires a showing of actual prejudice, survive the due process standard set forth in Caperton v. A.T. Massey Coal Co., 129 S.Ct. 2252 (2009)? (2) If so, where a party alleges that a judge has had ex parte communications with a party, does the statutory standard apply, or is the objective appearance of impropriety standard set forth in Rule 63(c)(1) of the Judicial Code applicable? See Civil Procedure.
   
• The Board of Education of Auburn Community Unit School District No. 10 v. The Illinois Department of Revenue, No. 110395 & 110422 -- Does the Property Tax Extension Limitation Law ("PTELL") apply to all portions of a community unit school district following annexation of territory in a separate county which had not opted into PTELL? See Taxation.
   
• Bell v. Hutsell – No. 110724 -- (1) Where defendants did not personally furnish alcoholic beverages, is liability for breach of a voluntary undertaking to monitor and inspect barred by the bar on civil social host liability? (2) Is there a private right of action under the Liquor Control Act for permitting one’s minor child or his or her invitees to possess, distribute or consume alcoholic beverages? See Tort Law.

 

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On Friday the Illinois Supreme Court published its Call of the Docket [pdf] for the May term, and the Court will hear oral argument in five civil cases. The cases, with the issue or issues presented in each, are:

May 11:

Palm v. 2800 Lake Shore Drive Condominium Association,No. 110505 – Are the provisions of the Chicago Condominium Ordinance giving the right to compel production of documents, and authorizing interim awards of attorneys' fees, preempted by purportedly conflicting state law? See Civil Procedure.

May 17:

Sierra Club v. Illinois Pollution Control Board, No. 110882 – (1) Does a petitioner in an individual adjusted standard proceeding before the Illinois Pollution Control Board have a burden of proof with respect to the standards set forth in Section 27(a) of the Illinois Environmental Protection Act? (2) Must the Board make written findings or identify substantive evidence supporting its resolution of the Section 27(a) factors in such a proceeding? (3) Do environmental activist groups have standing to seek judicial review of the Board’s decision in an individual adjusted standard proceeding? See Government Law.

Petersen v. Petersen, No. 110984 – Where a judgment of marital dissolution, ordering the payment of child support, expressly reserves the issue of each party's obligation to contribute to the college or other education expenses of the parties' children, is a subsequent order allocating such expenses a "modification" of the child support order within the meaning of the Marriage and Dissolution of Marriage Act, 750 ILCS 5/510, such that only sums incurred on the notice date of the petition and afterwards may be awarded? See Domestic Relations.

City of Chicago v. Stubhub! Incorporated, No. 111127 – May municipalities such as the City of Chicago require electronic intermediary services to collect and remit amusement taxes on resold tickets? (Certified by the United States Court of Appeals for the Seventh Circuit, Case No. 09-3432, 624 F.3d 363.

Wirtz v. Quinn, No. 111903 – Does Public Act 96-34 violate the single subject rule of the Illinois Constitution?  See Government Law.

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The California Supreme Court has scheduled oral arguments for May, including four civil cases.

• Brown v. Mortensen: The Court will address whether the Federal Credit Reporting Act (15 U.S.C. § 1681 et seq.) preempts causes of action for the improper disclosure of medical information under California’s Confidentiality of Medical Information Act (Civ. Code, § 56 et seq.). This case attracted one amicus brief in support of appellants (by the National Association of Consumer Advocates). For more details about Brown, see the B & P 17200/Class Actions/Commercial update page.

• Save the Plastic Bag Coalition v. City of Manhattan Beach: Does the plaintiff, an association of plastic bag manufacturers, have standing to challenge a local ban on the use of plastic bags? The Court also granted review to address whether the ordinance was properly held invalid for the failure to prepare an environmental impact report. This case has generated significant amicus interest, including four amicus briefs supporting the City’s ordinance (by Heal the Bay, Manhattan Beach Residents Association, Californians Against Waste, and [jointly] the League of California Cities and California State Association of Counties) and one supporting the plastic bag manufacturers (by the Pacific Legal Foundation). For more details about Save the Plastic Bag Coalition, see the Environmental update page.

• Shalant v. Girardi: If a vexatious litigant subject to a prefiling order files a lawsuit while represented by counsel, may the litigant proceed in propria persona without first obtaining the approval of the presiding judge under C.C.P.§ 391.7 should counsel later withdraw? The Court of Appeal thought so, reversing the trial court’s dismissal. This case attracted one amicus brief supporting the plaintiff vexatious litigant (by the Los Angeles Society For The Prevention Of Cruelty To Animals). For more details about Shalant, see the Attorney-Related update page.

• In re K.C.: What injury is needed for a parent to have standing to contest the denial of a petition to place his child with the child’s grandparents? This case attracted one amicus brief in favor of the Kings County Human Services Agency (by the California State Association of Counties). For more details about In Re K, see the Other update page.
   

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The California Supreme Court has granted review in Ennabe v. Manosa, S189577, in which the Second District Court of Appeal upheld a summary judgment for defendant, who hosted a party at a private residence where alcoholic beverages were available and who charged uninvited party guests an entrance fee of $3 to $5. The Court of Appeal accepted, with little discussion, that the defendant was a “social host” for purposes of Civil Code §1714(c), and hence generally immune from civil liability for furnishing alcoholic beverages both under that provision and under Business and Professions Code §25602. The unanimous panel then held that where drinks were simply available to party guests, once admitted, the host had not sold or caused to be sold an alcoholic beverage under Business and Professions Code §25602.1, and was therefore not civilly liable for damages for admitting to the party an obviously intoxicated minor who, upon leaving the party, drove his car into a pedestrian, another partygoer, killing him. The court further held that, in any case, the defendant was not “required to be licensed” for this party within the meaning of Business and Professions Code §25602.1, giving “no weight” under these facts to a contrary statement in an information guide by the Department of Alcoholic Beverage Control, because it failed to address or cite the controlling statutes.

The California Supreme Court granted review on two issues: 1) whether such a defendant is a “social host” pursuant to Civil Code §1714(c); and, 2) whether the exception to immunity created by Business and Professions Code §25602.1 applies under these facts. The high court had previously noted the first issue, without deciding it, in Cory v. Shierloh (1981) 29 Cal.3d 430, 437. For more details about Ennabe, see the Torts & Products update page.
 

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In Cevallos v. Rideout, No. SC09-2238 (review granted Apr. 20, 2010), the Florida Supreme Court must determine how, or if, the rebuttable presumption that a rear-driver was the sole, proximate cause of rear-end collision applies when the rear-driver was the plaintiff.  The lower court decision is reported at 18 So. 3d 661 (Fla. 4th DCA 2009).  Oral argument took place on February 8, 2011.  Before discussing the actual case under review, it might be useful to discuss the history of Florida law on this issue and where it stands today.

HISTORY OF THE REAR-END COLLISION PRESUMPTION

The rear-end collision rule was recognized by Florida appellate courts in 1958 and approved by the supreme court shortly thereafter in 1959.  The rule arose to fill the evidentiary void created by a lead-driver’s inability to explain the reason for the rear driver’s collision with his or her vehicle.  That is, while a plaintiff ordinarily bears the burden of proving the four elements of negligence, obtaining proof of a breach and causation in a rear-end collision is difficult because while a plaintiff-driver may know he or she has been rear-ended, the plaintiff usually does not know why.

THE REBUTTABLE PRESUMPTION TODAY

 Florida law currently presumes that the driver of a rear vehicle was negligent unless that driver provides a substantial and reasonable explanation as to why he or she was not negligent, in which case the presumption would vanish and the case could go to the jury on the merits. Stated another way, there is a rebuttable presumption that the negligence of the rear driver in a rear-end collision was the sole proximate cause of the accident.  This presumption may be rebutted when the defendant produces evidence that the rear-end collision was not the result of the rear-driver’s negligence.  Florida courts have recognized three specific fact patterns which may rebut this presumption:

(1) affirmative testimony regarding a mechanical failure (e.g., brake failure);

(2) affirmative testimony of a sudden and unexpected stop or unexpected lane change by the car in front; and

(3) when a vehicle has been illegally and, therefore, unexpectedly stopped.

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The Illinois Supreme Court has announced that on the morning of Thursday, March 24^th, it will file opinions in five civil cases (pdf):

• Williams v. Board of Review, No. 109469--Was terminated employee entitled to a good cause extension of the statutory deadline requiring that an eligible worker must enroll in an approved training program within a certain time in order to be eligible for federally funded trade adjustment assistance benefits? See Employment Law.
   
• Goodman v. Ward, No. 109796 -- Is a candidate for a judgeship in a particular judicial subcircuit required to be a resident of that subcircuit on the date the candidate petitions to have his or her name placed on the primary ballot? See Election Law.
   
• Barber v. American Airlines, Inc., No. 110092 -- Did airline’s unilateral refund of passenger’s baggage fee, after passenger filed putative class action complaint, constitute an attempted “pick off” which did not moot passenger’s complaint? See Civil Procedure.
   
• Howell v. Dunaway – Nos. 110199, 110200 -- Is a hospital’s statutory lien for services, filed pursuant to the Health Care Services Lien Act, 770 ILCS 23/1, subject to a reduction under the common fund doctrine for attorney fees incurred by the injured plaintiff? See Tort Law.
   
• Vincent v. Alden Park Strathmoor, Inc., No. 110406 -- Does a claim for common law punitive damages pursuant to the Nursing Home Care Act survive the death of the nursing home patient? See Punitive Damages.

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The Texas Legislature is currently considering House Bill 274, containing several measures that could alter the landscape of civil litigation. HB274 would, if enacted:

• Require the Texas Supreme Court to adopt rules creating a motion-to-dismiss practice patterned on Rules 9 and 12 of the Federal Rules of Civil Procedure (Texas currently does not have a procedure that permits a dispositive motion for failure to state a claim)

• Permit a prevailing defendant to recover attorneys’ fees and costs when the trier of fact finds that the plaintiff has engaged in an “abusive civil action,” defined as an action that “a reasonable person would conclude is an abuse of the civil justice process.” The provision allows for recovery from a claimant’s attorney if the attorney has a financial interest in the case

• Provide for permissive interlocutory appeal of an order that involves a controlling question of law when an immediate appeal would materially advance the termination of litigation

• Permit claimants in cases with between $10,000 and 100,000 to elect to proceed under expedited trial and discovery procedures

• Forbid courts from construing statutes as creating a cause of action in the absence of clear and unambiguous language

It remains to be seen whether these reforms will make progress in a legislative session that will necessarily focus on the state’s budgetary woes.

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• Oasis West Realty v. Goldman (S181781) – Does an attorney’s duty of loyalty owed to a former client apply when the attorney actively takes a position against the former client on the same issue for which the lawyer previously had been retained, but does so while acting on his or her own behalf, without a subsequent representation or employment? For more details about Oasis West Realty, see the Attorney-Related update page.

• Diaz v. Carcamo (S181627) – In an attempt to extend the holding in Armenta v. Churchill (1954) 42 Cal.2d 448, which held that a claim of negligence entrustment is no longer viable against an employer who admits to being vicariously liable for the employee, the employer in Diaz argues that the same result should apply to a claim of negligent hiring against the employer, thus precluding evidence of the employee’s poor driving record. The Court of Appeal declined to make such an extension, in part because Armenta pre-dates Proposition 51. This case has attracted significant amicus interest, and multiple requests to depublish the Court of Appeal opinion. For more details about Diaz, see the Torts and Products update page.

• Sullivan v. Oracle Corporation (S170577) – This case addresses the application of California Labor Code overtime requirements to out-of-state employees hired by a California employer, including: (1) Does the Labor Code apply to overtime work performed in California for a California-based employer by out-of-state plaintiffs, such that overtime pay is required for work in excess of eight hours per day or in excess of forty hours per week? (2) Does Bus. & Prof. Code § 17200, et seq., apply to such overtime work? (3) Does § 17200, et seq. apply to overtime work performed outside of California for a California-based employer by out-of-state plaintiffs if the employer failed to comply with the overtime provisions of the federal Fair Labor Standards Act, 29 U.S.C. § 207 et seq.? This case has also attracted significant amicus interest. For more details about Sullivan, see the Employment – Compensation & Benefits update page.

• Franchise Tax Board v. Superior Court (Gonzales) (S176943) – Here, the Court will address the question of whether article I, section 16, of the California Constitution provides a taxpayer the constitutional right to a jury trial in an action for a refund of taxes under Revenue and Taxation Code  § 19382. For more details about Franchise Tax Board, see the Taxation and Assessments update page.
   

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This afternoon, the Illinois Supreme Court published its Call of the Docket [pdf] for the March term, and the Court will hear oral argument in six civil cases. The cases, with the issue or issues presented in each, are:

March 16:

Sheffler v. Commonwealth Edison Co.,No. 110166 – Does a complaint seeking both injunctive relief and damages in connection with defendant’s alleged failure to timely restore power after storms, and to give priority in restoring power to customers dependent on electric life support system, fall within the exclusive jurisdiction of the Illinois Commerce Commission? See Tort Law.

Italia Foods, Inc. v. Sun Tours, Inc.,No. 110350 – (1) Does the federal Telephone Consumer Protection Act require that the Illinois legislature enact enabling legislation before private claims under the TCPA can be heard in state courts? (2) Are TCPA claims "statutory penalties" within the meaning of state law, and if so, are the claims assignable, and what is the applicable statute of limitations? (3) If the claim is not assignable, were absent class members' claims tolled when, for a twenty-seven month period, no class representative with proper standing was present before the court? See Civil Procedure.

The Board of Education of Auburn Community Unit School Dist. No. 10 v. The Illinois Dept. of Revenue, No. 110395/110422 – Does the Property Tax Extension Limitation Law ("PTELL") apply to all portions of a community unit school district following annexation of territory in a separate county which had not opted into PTELL? See Taxation.

March 22:

ABATE of Illinois, Inc. v. Giannoulias, No. 110611 – Does a state statute permitting the transfer of funds from the Cycle Rider Safety Training Fund to the General Revenue Fund violate the Takings Clause of either the federal or state constitutions? See Constitutional Law.

Bell v. Hutsell, No. 110724 – (1) Where defendants did not personally furnish alcoholic beverages, is liability for breach of a voluntary undertaking to monitor and inspect barred by the bar on civil social host liability? (2) Is there a private right of action under the Liquor Control Act for permitting one’s minor child or his or her invitees to possess, distribute or consume alcoholic beverages? See Tort Law.

Snyder v. Heidelberger, No. 111052 – Does a quitclaim deed intended to create a joint tenancy between a husband and wife cause an injury within the meaning of the statute of repose for legal malpractice actions, 735 ILCS 5/13-214.3, when the deed is executed and recorded, when the husband dies and the alleged error can no longer be rectified, or both? See Tort Law.

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On January 18, 2011, the Eleventh Circuit Court of Appeals in Essex Insurance Co. v. Zota (.pdf) brought an end to seven years of litigation and four appellate proceedings, when it affirmed a final declaratory judgment entered in favor of a surplus lines insurer, Essex Insurance Company, following a jury trial.  Although the Eleventh Circuit’s decision is brief and unpublished, the Court’s decision and the earlier appeals in the case established certain significant precedent for surplus lines insurers doing business in the State of Florida on issues relating to policy form filing, policy delivery, and the reach of Chapter 627, Florida Statutes to surplus lines carriers.

BACKGROUND

Mercedes Zota was injured when she fell while painting a mural on the second-story ceiling of a “spec” home under construction in Lighthouse Point, Florida.  After the incident, Zota and her husband brought a negligence action against Lighthouse Intracoastal, Inc.; Broward Executive Builders, Inc., the general contractor for the project; and Jack Farji, a 50% shareholder of Lighthouse and the owner of Broward Executive.  Lighthouse’s insurer, Essex, then sought declaratory relief in federal district court regarding its obligations with respect to the defendants in the negligence action.  After the district court narrowed the issues for trial during summary judgment proceedings, the case proceeded to trial on the two remaining factual issues arising from the policy exclusion at issue:  (1) Whether Lighthouse was a contractor at the time of the construction; and (2) Whether Lighthouse was a builder at the time of the construction.  Because the jury found that Lighthouse was a builder, the Essex policy did not provide coverage and final judgment was entered in Essex’s favor.

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• Insurance – In Century-National Ins. Co. v. Jesus Garcia, the court held that a fire insurance policy could not exclude coverage for innocent insureds because of the intentional acts of another insured; in this case the intentional act of the son setting fire to his parents house. The policy excluded coverage based on the intentional act or criminal conduct of “any insured,” and on this basis the carrier excluded coverage for the parents based on the acts of the son. While similar language was previously held as effective to exclude coverage as to all insureds in Minkler; the Court held that Insurance Code §§ 2070 and 533 limit the scope of such an exclusion in fire insurance policies to the specific insured who committed the intentional act. In doing so, the Court warned that this holding may have limited application in other contexts. For more details about Century-National Ins. Co. see the Insurance update page.

• Consumer Protection – The Song-Beverly Credit Card Act of 1971 is a consumer protection act which bars businesses from requesting that cardholders provide “personal identification information” during credit card transactions, and then recording that information. In Pineda v. Williams-Sonoma Stores, Inc. the Supreme Court found that zip codes constituted “personal identification information,” making it a violation of the act for a business to request and record zip codes as a part of credit card transactions. For more details about Pineda see the B & P 17200/Class Actions/Commercial update page.

• ADR – Several of the plaintiffs in Tarrant Bell Property, LLC v. Superior Court (Abaya) signed lease agreements requiring that any arbitrable issues, including those involving conditions at the subject mobilehome park, which were made subject to judicial proceedings would be decided by a referee upon the motion of any party pursuant to CCP § 638.  After the residents collectively brought suit, the trial court refused to enforce this provision and the Supreme Court affirmed, finding that the trial court had discretion to deny the motion. Moreover, given the redundancy that would result from referring only some of the residents to a referee over the same legal issues, the trial court did not abuse its discretion. In so ruling, the Court disapproved of both Greenbriar Homes Communities, Inc. v. Superior Court (2004) 117 Cal.App.4th 337, and Trend Homes, Inc. v. Superior Court (2005) 131 Cal.App.4th 950, to the extent they are inconsistent. For more details about Tarrant Bell Property, LLC see the ADR update page.
   

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Before profiling potential candidates to replace Justice Moreno on the California Supreme Court, we first provide a brief profile of the remaining court – not including Justice Moreno, whose announced retirement has initiated this discussion. When choosing a new member for the high court, there is often a discussion about what is “missing” from the court; in order to better address that issue, it can be helpful to look at its existing composition.

The remaining six members of the California Supreme Court represent a total of 134 years of judicial experience, although only two of them, Chief Justice Cantil-Sakauye and Justice Corrigan, had extensive experience on the bench before joining the high court, each with about twenty years of prior experience. In comparison, Justice Chin had previously served as a judge for eight years, while the others had previously served for about three years each. There may be other types of judicial experience, however, in that Justice Werdegar was a senior staff attorney with both the California Court of Appeal and the California Supreme Court, while Justice Baxter assisted in the appointment of more than 700 judges while serving in the Deukmejian administration. However, regardless of their varied judicial experiences, each of the current justices had previously sat on a Court of Appeal before being nominated to the Supreme Court.

The average tenure of the remaining Supreme Court justices is about 13 years, ranging from 22 years for Justice Kennard to about one month for Chief Justice Cantil-Sakauye. A majority of the justices have been on the Supreme Court for at least 15 years. While the existing justices had widely varying experiences before taking the bench, all of them were government prosecutors earlier in their careers, most as deputy district attorneys (Justice Werdegar worked in the U.S. Dept. of Justice, Justice Kennard in the L.A. Attorney General’s office). All of the justices are long time California residents, with four of them native born and two others moving here in the early 1960’s. The average age of the remaining justices is about 65, with the youngest being Chief Justice Cantil-Sakauye at 51 years old.

All of the justices were nominated to the Supreme Court by Republican governors, two each by Deukmejian, Wilson and Schwarzenegger. As such, the new justice, like Justice Moreno, will be the only member of the Court nominated by a Democratic governor. Of the remaining six justices, four are women, meaning the court will have a female majority regardless of who Governor Brown nominates. Along ethnic lines, the court has three Asian-Americans and three justices of European descent. The current lack of either a Latino or an African-American has been raised by commentators in predicting the next nominee.

In future posts, we will profile candidates being considered to replace Justice Moreno on the California Supreme Court. 

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In Cassel v. Superior Court (Wasserman Comden Casselman & Pearson), the California Supreme Court evaluated the mediation confidentiality created by Evidence Code, § 1119, which prevents the admission of “evidence of anything said,” or any “writing” which was prepared “for the purpose of, in the course of, or pursuant to, a mediation. . . .”, subject only to certain statutory exceptions. Upholding an earlier Court of Appeal decision, Wimsatt, but reversing here, the Court found that the express statutory language applied to protect discussions between counsel and client made during and immediately preceding the mediation in the underlying action, even in a subsequent legal malpractice action in which counsel’s conduct at the mediation was a basis for the malpractice claim. As a result, the court found that counsel defending itself against a legal malpractice action was entitled to exclude evidence of such communications with its own former client, now the legal malpractice plaintiff. While expressing no opinion on the merits of this statutory scheme, the Court noted that the Legislature was free to reconsider it. Justice Chin concurred, “reluctantly,” noting this was “a high price to pay for confidentiality in the mediation process,” and suggesting statutory amendments which could avoid this result while preserving mediation confidentiality. For more history regarding Cassel, see the ADR update page.

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After serving the California courts for twenty-four years, Associate Justice Carlos R. Moreno has announced his retirement from the court.  In a recent interview, Justice Moreno said that recent changes, including the retirement of Chief Justice Ronald George and the election of Governor Jerry Brown, had prodded him to explore other possibilities.  His retirement creates an early opportunity for newly sworn Governor Brown to establish a tone for his administration. In future posts, we will provide profiles for candidates being considered to fill this unexpected vacancy. But first, we note the distinguished judicial career of Justice Moreno.

Justice Moreno is native to Los Angeles, where he continued to live after his appointment to the Supreme Court by commuting to San Francisco.  After receiving a B.A. in political science from Yale University (1970) and a 1975 J.D. from Stanford Law School, Carlos Moreno served in the Los Angeles City Attorney's Office, prosecuting criminal and civil consumer protection cases. In 1979, he joined a private firm, representing clients in general commercial litigation. During this time he was also president of the Mexican American Bar Association.

Moreno has enjoyed judicial nominations from both parties. Governor George Deukmejian appointed Justice Moreno to the Municipal Court, Compton Judicial District, in 1986, where Moreno handled general criminal matters and supervised the court’s civil department. In October 1993, Governor Pete Wilson elevated Justice Moreno to the Los Angeles County Superior Court, where he presided over felony trials in downtown Los Angeles. In 1997, Moreno received the Criminal Justice Superior Court Judge of the Year Award from the Los Angeles County Bar Association. President Bill Clinton nominated Justice Moreno to the federal bench, and he was unanimously confirmed to the United States District Court for the Central District of California by the United States Senate in February 1998.

After his nomination by Governor Gray Davis, Justice Moreno was sworn in as an associate justice of the Supreme Court of California on October 18, 2001. Moreno was given the Roger J. Traynor Appellate Justice of the Year Award from the Consumer Attorneys Association of Los Angeles in 2003. At present, Justice Moreno is the only Democrat on the Supreme Court, and the only Latino.  Describing himself as a “moderate-to-liberal centrist,” Moreno initially sided with conservative members of the court as often as its more liberal members. As the court reportedly became more conservative over the years Moreno wrote an increasing number of solo dissents, the most prominent of which was his dissent from the Court’s decision upholding Proposition 8, in which the Court reinstated the ban on same-sex marriage.  Justice Moreno was prominently mentioned as a potential nominee by President Obama for the United States Supreme Court both in 2009 and in 2010.  During that debate, Appellate Strategist profiled Justice Moreno here.

Join us below the jump for a sampling of Justice Moreno’s most important opinions.

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The CA Supreme Court has scheduled three civil cases for hearing on February 8, 2011. These cases address issues of duty & causation, the statute of limitations for multiple distinct injuries and the final judgment rule.

• Pooshs v. Philip Morris USA, Inc., et al., S172023, results from a request for guidance from the Ninth Circuit regarding the application of the statute of limitations on multiple distinct personal injuries allegedly arising from smoking tobacco; specifically - does the earliest injury trigger the statute for all claims, including those based on a later injury? For more details regarding Pooshs, see the Civil Procedure/Evidence/Discovery update page.

• Cabral v. Ralphs Grocery Company, S178799, addresses whether a big-rig truck driver owes a duty of care to freeway motorists not to park for non-emergency reasons in an “Emergency Parking Only” area at the side of a freeway. Review was also granted on the issue of whether the driver’s act of parking in the “Emergency Parking Only” area was not a substantial factor, as a matter of law, in causing plaintiff’s injuries in this case. For more details regarding Cabral, see the Torts & Products update page.

• In re Baycol Cases I and II, S178320, the Court addresses whether the “death knell doctrine” requires plaintiff to immediately appeal the sustaining of a demurer as to class claims when the ruling resolved both individual and class claims, or whether the one final judgment rule applies and requires a single appeal from the subsequent entry of final judgment on all claims? For more details regarding Baycol, see the Appeals & Writs update page.
   

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Justice Carlos Moreno of the California Supreme Court announced today that he will be retiring from the Court, effective February 28, 2011.  The surprise announcement, coming on the heels of Chief Justice Ronald M. George's retirement, gives new Governor Jerry Brown his first Supreme Court appointment only days into his term.

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For the final day of our profile of retiring California Chief Justice Ronald M. George, we offer our own subjective list of the Chief Justice’s most notable opinions. If anyone has a nomination for a favorite case that belongs on this list – and there are many important opinions that aren’t here – explain in the comments section.

In re Marriage Cases, 43 Cal.4th 757 (2008) – Reversing the Court of Appeal, the Supreme Court held that provisions of the Family Code defining marriage as between a man and a woman violated the fundamental constitutional right to marry of all Californians. This was so for several reasons: (1) the exclusion of gay couples from the designation of marriage was not necessary to afford full protection to the rights and benefits accorded opposite-sex couples; (2) denying the designation "marriage" to same-sex couples would impose appreciable harm on such couples and their children; (3) denying same-sex couples the designation of "marriage" would be perceived as reflecting an official view that such relationships are of lesser dignity, and that same-sex couples and gay individuals are in some respects "second-class citizens."

Costa v. Superior Court, 37 Cal.4^th 986 (2006) – In a legal challenge to Proposition 77, the Supreme Court found that where a challenger questioned whether an voter initiative was properly before the voters – as opposed to the substantive validity of the change in law made by the initiative – it should, as a general matter, be resolved before the election. The Court further held that technical deficiencies in referendum and initiative petitions should not invalidate the petitions if they are in substantial compliance with statutory and constitutional requirements.

Yanowitz v. L'Oreal USA, Inc., 36 Cal.4th 1028 (2005) -- The Supreme Court held that a plaintiff's refusal to follow an order which he or she reasonably believed to be discriminatory was a protected activity within the meaning of the Fair Employment and Housing Act, so long as the employee's communications to the employer sufficiently convey the employee's reasonable concerns that the employer has acted or is acting in an unlawful manner. The Court concluded that the appropriate test for determining an adverse employment action within the meaning of the statute was whether the action materially affected the terms and conditions of employment.

Miller v. Department of Corrections, 36 Cal.4th 446 (2005) – Reversing the Court of Appeal, the Supreme Court held that a plaintiff could establish an actionable claim under the FEHA by demonstrating, in a case involving a supervisor who allegedly gave favorable employment opportunities to a person with whom he was having an affair, that the sexual favoritism was so severe or pervasive as to alter his or her working conditions and create a hostile environment.

Aguilar v. Avis Rent a Car System, Inc., 21 Cal.4th 121 (1999) – In an action for employment discrimination and wrongful discharge, the trial court entered an injunction directing defendant to cease and desist from using derogatory racial or ethnic epithets directed at Hispanic/Latino employees. The Supreme Court affirmed, holding that the injunction was not a prior restraint barred by the First Amendment. The Court pointed out that the vice of a prior restraint is that communication will be suppressed before an adequate determination that it is unprotected by the First Amendment. Plaintiffs' speech, in contrast, had been adjudicated to be unprotected on the grounds that it contributed to a hostile working environment. The Court held that enjoining the continuation of unprotected speech was not contrary to the Federal or state constitution.

NBC Subsidiary (KNBC-TV), Inc. v. Superior Court, 20 Cal.4th 1178 (1999) -- The Court held that as a general matter, the First Amendment protects the right of access to civil trials and proceedings. Under Code of Civil Procedure Section 124, a proceeding may not be closed unless the trial court provides public notice of the intent to hold closed proceedings; and after a hearing, expressly finds that (1) an overriding interest supports closure, (2) there is a substantial likelihood of prejudice to that interest absent closure, (3) the closure is narrowly tailored to protect the threatened interest, and (4) there is no less restrictive means available.

Curran v. Mount Diablo Council of the Boy Scouts of America, 17 Cal.4th 670 (1998) -- Plaintiff's application to serve as an assistant scoutmaster was rejected, and he sued under the Unruh Act, alleging that the rejection was on grounds of his homosexuality. The Supreme Court held that the Boy Scouts were not a "business establishment" within the meaning of the Unruh Act, noting that although the Scouts regularly engaged in business transactions with nonmembers, the primary function of the Scouts was to inculcate certain values in youth members. Nor did business transactions with nonmembers involve sale of access to the basic activities or services offered by the organization.

American Academy of Pediatrics v. Lungren, 16 Cal.4th 307 (1997) -- The Supreme Court affirmed a judgment permanently enjoining the enforcement of a state statute requiring parental consent or judicial authorization before a minor may obtain an abortion. The Court acknowledged that certain parental consent laws had been upheld at the Federal level, but pointed out that the right to privacy protected by the state constitution was, in many contexts, broader and more protective of privacy than the federal right. The Court held that because the statute intruded upon an interest fundamental to personal autonomy, it was subject to scrutiny under the compelling interest test. The Court concluded that the statute could not be upheld on the grounds that it was necessary to protect the health of a pregnant minor, or to protect the minor's relationship with her parent.

Vons v. Seabest Foods Inc., 14 Cal.4th 434 (1996) -- In a case arising from an e coli outbreak, the Supreme Court held that the trial court could constitutionally exercise specific jurisdiction over a cross-claim between a meat supplier and certain franchisees. The Court pointed out that the cross-defendants' franchise agreements -- which specified that California law governed disputes -- controlled the purchase of ingredients, training, equipment and cooking procedures. The Court concluded that the cross-claim was sufficiently related to two contracts substantially connected to California -- the franchisees' franchise agreement, and their contract with the meat supplier -- to serve as a basis for jurisdiction.

Warfield v. Peninsula Golf & Country Club, 10 Cal.4th 594 (1995) -- In an action arising from a country club's termination of a woman's country club membership, the Supreme Court held that the Club was a "business establishment" subject to the Unruh Act. The Court emphasized the Club's interaction with the public: (1) the Club regularly permitted nonmembers to rent facilities for a fee; (2) the Club regularly obtained income from fees for the use of its facilities, and the purchase of food and beverages; (3) the Club obtained indirect financial benefit from the regular business transactions with nonmembers conducted on the premises. The Court also rejected the defendant's claim that subjecting the Club to the Unruh Act would violate its members' constitutional right to freedom of association.

Knight v. Jewett, 3 Cal.4th 296 (1992) -- In an action arising from an informal game of touch football, the Supreme Court granted review to determine the proper application of assumption of the risk, if any, following the adoption of comparative negligence. The Court held that the cases in which assumption of the risk had been applied could be divided into two classes: "primary assumption of the risk," referring to cases in which the court concluded that defendant owed plaintiff no duty to protect him from a particular risk; and "secondary assumption of the risk," meaning cases where defendant did owe a duty, but the plaintiff knowingly encountered the risk. The Court held that while "primary assumption of the risk" was still viable under a comparative negligence regime, "secondary assumption of the risk" was merged into the comparative negligence analysis. "Primary assumption of the risk," the Court found, depended not upon the reasonableness of the plaintiff's conduct, but rather on the nature of the activity or sport in which the defendant is engaged, and the relationship of the defendant and the plaintiff to that activity or sport.

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In the first two posts of this series, we've reviewed Chief Justice George's career prior to his judicial service, and his early years as a Judge of the Los Angeles Superior Court and a Justice of the Court of Appeals. Today, we turn to a review of the Chief's more than eighteen years on the California Supreme Court.

 Chief Justice George was appointed to the Supreme Court by Governor Pete Wilson on July 29, 1991, replacing the retiring Justice Allen Broussard. "At the risk of being immodest," Governor Wilson said as he announced the nomination, "I don't see how I could have done better." The Judicial Nominees Evaluation Commission agreed with Governor Wilson's assessment, rating George "exceptionally well qualified." During his five years as a moderate member of the Lucas Court, the Chief Justice wrote a variety of important opinions for the Court on subjects such as civil rights, domestic relations and the California initiative system.

In late 1995, Chief Justice Lucas announced his retirement. Governor Wilson nominated George on March 28, 1996, as the twenty-seventh Chief Justice of California. Once again he received a rating of "exceptionally well qualified" from the JNE Commission, and the Chief Justice was resoundingly confirmed by the voters in 1998, winning retention by a three-to-one margin.

Chief Justice George's tenure has been a time of fundamental reform for California's court system. As the Chief Justice recalled earlier this year in a speech to the State Bar, he assumed office as Chief Justice in the midst of yet another state financial crisis. "I was determined to improve the fiscal security of the trial courts," he said. Many counties were facing "substantial closures and cutbacks in courtroom and clerk's office services as well as widespread employee layoffs." The Chief Justice's first major goal was achieved the following year when, in the waning hours of its legislative session, the Legislature enacted a bill creating a statewide system of funding for California's courts.

The second major reform of the Chief Justice's tenure came only one year later. When the Chief Justice took office, California's judiciary was a maze of over two hundred different superior and municipal courts. The result -- as the new Chief Justice observed in the course of visiting all fifty-eight of California's counties in those early years of his term -- was overlapping of services and inefficiency. As the Chief Justice recalled earlier this year: "Too often, courts were struggling in solitude to meet their obligations, without anywhere to turn. I found the equivalent of the wheel being reinvented in country after county."

All that changed in 1998 when the electorate approved a constitutional amendment permitting the counties' superior and municipal courts to unify into a single trial court for each county. Within three years, judges in every county had voted to unify.

In 2002, Chief Justice George achieved another major goal with passage of the Trial Court Facilities Act, which transferred responsibility, and in many cases ownership, of the 532 court facilities scattered around the state from the individual counties to the judicial branch. Six years later, a $5 billion revenue bond measure was approved, providing financing for forty long-overdue court construction and modernization programs.

The Chief Justice has received dozens of honors for his service throughout his judicial career. In recent years, these have included the James Madison Freedom of Information Award from the Society of Professional Journalists (2003), the Matthew O. Tobriner Public Service Award from the Legal Aid Society of San Francisco (2006), the American Judicature Society's Opperman Award for Judicial Excellence (2006) and the Champion of Justice Award from the Bar Association of San Francisco. In 2009, the Chief Justice was inducted as a Fellow of the American Academy of Arts and Sciences.

Join us tomorrow as we conclude our profile with our nominations for the Chief Justice’s most notable opinions.

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Yesterday, in the first post of this series, we considered Chief Justice George’s career prior to his elevation to the bench. Today, we continue with the Chief’s service on the trial bench and the California Court of Appeal.

The Chief Justice was appointed to the Los Angeles Municipal Court on April 20, 1972 by Governor Ronald Reagan. He was thirty-two years old. “I sort of felt and looked like the boy judge,” he told a newspaper reporter in 1996. He served as Supervising Judge of the West Los Angeles Branch of the Court in 1974-75, where he instituted several reforms, including a master court operation and seeing that forms were provided in Spanish translation. He was elected to a six-year term on the court without opposition in 1976.

Chief Justice George was elevated to the Los Angeles Superior Court on December 23, 1977, this time by a Democratic Governor – Jerry Brown. He was elected to six-year terms, again without opposition, in 1978 and 1984.

In 1981, then-Judge George was assigned to preside in the case of the Hillside Strangler, People v. Angelo Buono. The case nearly went off the rails in the pretrial stages when Kenneth Bianchi, an accused accomplice who had entered into a plea bargain agreement requiring him to testify, gave an unbelievable performance on the stand, ultimately testifying that he did not know whether he was telling the truth in saying Angelo was involved in the murders.

Concluding that Bianchi would never withstand cross-examination, the District Attorney’s office responded by moving to dismiss all ten counts of murder against Buono. In a courageous ruling, Judge George denied the motion to dismiss, concluding that there was sufficient evidence to corroborate Bianchi’s testimony and convict Buono. Not long after, the District Attorney withdrew from the prosecution, which was then undertaken by Attorney General George Deukmejian.

The trial was arduous -- jury selection consumed over three months, and the prosecution’s case involved more than a thousand exhibits and two hundred fifty witnesses. The Government’s closing argument took eleven days. But  finally, in the fall of 1983, what was at the time the longest criminal trial in U.S. history concluded with verdicts of guilty against Buono on nine of ten murder counts.

Following the Hillside Strangler case, George became Supervising Judge of the Criminal Division. On July 23, 1987, he was appointed to the Second District of the Court of Appeal, this time by Governor George Deukmejian.

Join us tomorrow as we review Chief Justice George’s nineteen years of service on California’s Supreme Court.

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On January 3, 2011, the twenty-seventh Chief Justice of California, Ronald M. George, will conclude over thirty-eight years of service on the California bench. To mark the retirement of this great California jurist, we begin a four part profile on state's third longest-serving Chief Justice.

Born in March 1940, Chief Justice George graduated from Beverly Hills High School in 1957. Following high school, the Chief attended the Woodrow Wilson School of Public and International Affairs. At the time, he planned to make his career in the Foreign Service.

All that changed at age nineteen, when he spent the summer between his sophomore and junior years in college hiking around West Africa and meeting American diplomats. "Most of them seemed to just be congregating amongst themselves and having very little contact with the local populace and not having much, if any, of an impact on the problems of the area," the Chief Justice recalled in a 1996 newspaper profile.

So he decided to attend law school. "I decided . . . that a law degree would offer the most options for whatever form of public service I might choose to pursue." The Chief Justice graduated from Stanford Law School in 1964.

Following law school, the Chief Justice joined the Attorney General's office as one of then-Attorney General Stanley Mosk's deputies. During seven years in the Attorney General's office, the Chief Justice handled a number of high-profile cases. The Chief was unsuccessful in one of his highest profile cases, People v. Anderson, where the Supreme Court struck down California's death penalty, but he prevailed not long after that in People v. Sirhan, where the Court affirmed the conviction of Sirhan Sirhan for assassinating Senator Robert F. Kennedy.

Chief Justice George served as counsel and argued six cases before the United States Supreme Court, including several which are still familiar to criminal law practitioners: Chimel v. California (invalidating warrantless search of entire house in connection with arrest of burglary suspect); Hill v. California (approving search incident to arrest, although police arrested the wrong person) and McGautha v. California (allowing jury to choose between life or death without governing standards not unconstitutional in capital cases) All together, the Chief Justice handled over one hundred appeals and writs, ending his career in the AG's office with a year as Administrative Assistant in charge of the Los Angeles office.

Join us tomorrow as we turn to the early years of the Chief Justice's judicial career.

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Resolving an express conflict between the District Courts of Appeal, the Florida Supreme Court held that when a party objects to instances of attorney misconduct during trial, and the objection is sustained, the party must also timely move for a mistrial in order to preserve the issue for a trial court’s review of a motion for new trial.  If the issue is not preserved in this manner, the conduct may still be subject to fundamental error analysis.  Ramiro Companioni, Jr. v. City of Tampa, 35 Fla. L. Weekly S738a (.pdf)

In the underlying case, Plaintiff sued the City of Tampa for personal injuries.  Throughout the trial, the City objected to several instances of misconduct on the part of Plaintiff’s counsel.  Although the objections were sustained, the City did not move for a mistrial.  After judgment was entered in favor of Plaintiff, the City moved for a new trial alleging that the cumulative effect of opposing counsel’s misconduct throughout trial deprived it of a fair trial.  The trial court found that although Plaintiff’s counsel’s conduct was so pervasive and prejudicial that it impaired the City’s right to a fair trial, the City had not moved for a mistrial and the conduct was not so extreme that “it would undermine the public’s confidence in the judicial system,” and on that basis denied the City’s motion.  The City appealed to Florida’s Second District Court of Appeal, which reversed the denial of a new trial based on the holding that the City’s contemporaneous objections to the misconduct were sufficient.  The Second District did not reach the separate issue of whether the complained of misconduct constituted fundamental error.  Because the Second District’s holding was in direct conflict with other appellate courts in Florida, the Florida Supreme Court accepted discretionary review.

The Court analogized the need for moving for a mistrial with the contemporaneous objection rule: 

“…failure to alert the trial judge that an error may be incurable results in delay and wastes judicial resources, especially if the error complained of occurs early on in the proceedings.  In cases such as the instant case where the trial judge sustains an objection, the trial judge is not put on notice that any further action is needed.  Without a request for mistrial or a curative instruction, the trial judge presumes that the objecting party has been satisfied that the error has been cured.”

As such, the Court quashed the Second District’s decision and remanded the case for consideration of whether the trial court abused its discretion in denying a new trial under a fundamental error analysis.

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Following the recent retirement of Justices Scotland and Sims, as well as the elevation of Justice Tani Cantil Sakauye to the California Supreme Court, the California Commission on Judicial Appointments has now confirmed four appointments for the Third Appellate District. First, Associate Justice Vance W. Raye, who has served on the Court of Appeal, Third Appellate District since 1991, was confirmed as Presiding Justice. The Commission also confirmed three new associate justices for the Third Appellate District:

• Judge Elena J. Duarte, who has served on the Superior Court of Sacramento County since 2008, having also served as a Superior Court Judge in Los Angeles (2007-2008), and as an Assistant U.S. Attorney for the Central District of California (1994-2007).

• Ms. Andrea Hoch, who has served as the Governor’s Legal Affairs Secretary since 2005, having previously served as the Administrative Director of the Division of Workers’ Compensation (2004-2005) and in the Office of the Attorney General (1992-2004).

• Judge William J. Murray, Jr., who has served on the Superior Court of San Joaquin County since 1995.
   

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While avoiding the marijuana legalization debates raging in the state, the California Supreme Court confirmed that orders compelling five medical marijuana dispensaries to comply with subpoenas issued by the City of Dana Point were appealable, reversing the dismissal by the Court of Appeal in these consolidated cases. In Dana Point Safe Harbor Collective v. Superior Court, S180365, the Court held that the order enforcing the legislative subpoena and compelling the production of documents was a final order for purposes of an appeal, returning the matter to the Fourth Appellate District, Division Three, of the Court of Appeal for further proceedings. In doing so, the Supreme Court specifically declined to address the ancillary issue of whether an appealing party is entitled to a stay of enforcement of the subpoena pending appeal. Having resolved a split in the Courts of Appeal, the Supreme Court disapproved Bishop v. Merging Capital, Inc.(1996) 49 Cal.App.4th 180, People ex rel. Franchise Tax Bd. v. Superior Court (1985) 164 Cal.App.3d 526, and Barnes v. Molino (1980) 103 Cal.App.3d 46, to the extent they are inconsistent with its holding. For more details regarding Dana Point Safe Harbor Collective, see the Appeals & Writs update page.

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Under Texas law, the public has an easement to access dry beaches. This easement extends landward to the vegetation line. A recent Texas Supreme Court case examined the validity of the easement when a hurricane suddenly alters the beachfront.

The property owner had constructed a house behind the vegetation line in the West Beach area of Galveston Island. Hurricane Rita caused sudden and dramatic beach erosion and the house was now seaward of the vegetation line. When the state attempted to enforce the public easement, the property owner initiated litigation in federal court arguing that the state was engaged in an unconstitutional “taking” of private property. Ultimately, the Fifth Circuit certified a question to the Texas Supreme Court regarding whether the public beach access easement “rolled” into previously unencumbered private property when storms altered the shoreline.

The Supreme Court distinguished between mere beach erosion and avulsion, a sudden and dramatic change in the shoreline. The beachfront is constantly changing due to natural forces and both the public and the property owner are properly charged with notice that their respective rights may be altered. In avulsion cases, however, the change is too sudden for the parties to adjust their behavior. Consequently, the public beach easement does not roll landward into previously unencumbered private property.

While the opinion provides some protection for property owners who build near beaches, it also places the precise boundary of the public easement into doubt. The vegetation line is no longer a reliable boundary in all cases.

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Code of Civil Procedure § 1021.5 allows for the recovery of attorney fees from the opposition under certain circumstances when a successful litigant acts as a private attorney general.  While it was well established that a financial interest in the matter can disqualify a party from an award under § 1021.5, it was disputed as to whether a non-financial interest could also disqualify a successful litigant from such a recovery.  In Conservatorship of Roy Whitley, the Supreme Court unanimously resolved this dispute by holding that “a litigant‘s personal nonpecuniary motives may not be used to disqualify that litigant from obtaining fees” under § 1021.5. In Whitley, the interest of the successful litigant was the appropriate care for her disabled brother, but she had no pecuniary interest as the case involved injunctive relief and the mandatory procedures for transferring a disabled person. It was not disputed that an important public right was at issue. The Supreme Court held that the application of § 1021.5 was conditioned on the “financial burden of private enforcement,” i.e., the existing financial incentives and burdens, and not on any nonpecuniary interest in the outcome.

To the extent they disagree with this conclusion, the Court disapproved of Williams v. San Francisco Bd. of Permit Appeals (1999) 74 Cal.App.4th 961, Families Unafraid to Uphold Rural El Dorado County v. Bd. of Supervisors (2000) 79 Cal.App.4th 505, Hammond v. Agran (2002) 99 Cal.App.4th 115, and Punsly v. Ho (2003) 105 Cal.App.4th 102. For more details about Whitley, see the Attorney Related update page.
 

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Conditional settlement agreements between a plaintiff and a codefendant are nothing new.  But when such an agreement is premised on the notion that the “settling” codefendant will continue to defend itself at trial, diminishing its own liability proportionately by increasing the liability of the other codefendants, it is against public policy.

The term “Mary Carter agreement” originated in the case Booth v. Mary Carter Paint Co. and evolved through its progeny.  It is essentially a contract by which one codefendant secretly agrees with the plaintiff that, if the defendant will proceed to defend itself in court, its own maximum liability will be diminished proportionately by increasing the liability  of the other codefendants.

Secrecy is the essence of such an agreement, because the court or jury as trier of the facts, if apprised of this, would likely weigh differently the testimony and conduct of the signing defendant as related to the nonsigning defendants.  By painting a gruesome testimonial picture of the other defendants’ misconduct or, in some cases, by admissions against himself and the other codefendants, he could diminish or eliminate his own liability by use of the secret “Mary Carter Agreement.”

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Texas has 14 intermediate appellate courts, more than any other state. In a recent Texas Tech Law Review article and in CLE presentations, Jones Day attorney, David Schenck, has questioned whether the state needs so many appellate courts. This large number of courts was created over many years on an ad hoc basis, seemingly due to the sprawling nature of Texas itself and a growing population. Mr. Schenck has reasoned that the large number of courts necessarily increases the odds of the development of circuit conflicts. This is particularly problematic in the Houston area, which is governed by two separate courts of appeal within the same geographical area. A trial court judge could find himself faced with conflicting opinions, both of which would be “controlling.”

Other anomalies exist as well. There is a substantial difference in case loads between the courts of appeals. While transfers for the purpose of docket equalization occur, these transfers can create thorny questions regarding the application of legal rules of the transferor’s court. Finally, a handful of counties have been placed in more than one appellate district. Aside from the possible conflicts problem, this situation has occasionally resulted in a “race to the court of appeal,” as litigants attempt to jockey for a more favorable court.

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With so much press devoted to political candidates and state propositions, there has been little attention to the three California Supreme Court justices who are standing for election tomorrow. Associate Justice Tani Gorre Cantil-Sakauye, currently sitting on the Third District Court of Appeal, is seeking confirmation of her nomination as the new Chief Justice, while Justices Ming W. Chin and Carlos R. Moreno are seeking to retain their existing positions on the Supreme Court. While a terse profile for all three justices is provided in the Voter’s Guide supplied by the Secretary of State, more detailed profiles are available:

• Associate Justice Tani Gorre Cantil-Sakauye
  • Official Court Profile
  • Judgepedia
  • News America Media

• Justice Ming W. Chin 
  • Official Court Profile
  • Judgepedia
  • Law.com
     
• Justice Carlos R. Moreno
  • Official Court Profile
  • Judgepedia
  • Our Previous Profile (as a potential nominee for the U.S. Supreme Court)
     

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The California Supreme Court has scheduled oral argument in three civil cases for hearing in Los Angeles in December 2007.

• Cortez v. Abich, which will address the extent of the household domestic service exception to Cal-OHSA (Labor Code section 6300 et seq.) in light of the defendant home owner’s remodeling project, which added a new master bedroom, a new master bath, a new garage in place of a carport, and a new roof. For more details about Cortez, see the Employment – Other update page.

• Sonic-Calabasas A, Inc. v. Moreno, addresses two issues: (1) Can a mandatory employment arbitration agreement be enforced prior to the conclusion of an administrative proceeding conducted by the Labor Commissioner concerning an employee’s statutory wage claim? (2) Was the Labor Commissioner’s jurisdiction over employee’s statutory wage claim divested by the Federal Arbitration Act under Preston v. Ferrer (2008) __ U.S. __, 128 S.Ct. 978? For more details about Sonic-Calabasas A, Inc., see the Employment – Other update page.

• California Farm Bureau Fed. v. California State Water Resources Control Bd., which evaluates Water Code § 1525: (1) Does § 1525, which was amended by the Legislature by majority vote in 2003 to impose annual fees on the persons and entities holding permits and licenses issued by the State Water Resources Control Board, impose an invalid tax or a lawful regulatory fee? (2) If §1525 is valid, may the Water Resources Control Board permissibly collect a fee levied on an entity which has sovereign immunity from a person or entity who has a contract with the immune sovereign? (3) If the statutory scheme is valid, but the regulations implementing it are invalid, did the Court of Appeal err in limiting refunds to only those persons and entities filing petitions for reconsideration before the Water Resources Control Board? For more details about California Farm Bureau Fed., see the Taxation & Assessments update page.

 

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This afternoon, the Illinois Supreme Court published its Call of the Docket for the November term, and the Court will hear oral argument in fifteen civil cases. The cases, with the issue or issues presented in each, are:

November 10:

General Motors Corp. v. Pappas, No. 108893 – (1) Does the 2005 amendment to the Property Tax Code, 35 ILCS 200/23-20, providing for the payment of interest on property tax refunds at the lower of 5% or the percentage increase in the urban CPI for the previous year, apply prospectively only? (2) Did trial court retain jurisdiction to grant judgment interest after the notice of appeal was filed? See Taxation

Illinois Department of Healthcare and Family Servs. v. Wiszowaty, No. 109151 – Did the 1987 amendments to Section 12-109 of the Code of Civil Procedure and Section 505 of the Illinois Marriage and Dissolution of Marriage Act make simple interest mandatory on past-due child support payments? See Civil Procedure.

Cookson v. Price, No. 109321 – Where plaintiff in a health care malpractice action failed to file a complying certificate, signed by a qualifying health care professional within the statutory period, attesting to the merit of the action, may the trial court give leave to file a replacement certification by another professional outside the statutory period?  See Civil Procedure.

November 16 –

Carr v. Gateway, Inc., No. 109485 – Where a commercial arbitration provision specifies a particular forum, which is no longer available when the dispute arises, is the entire arbitration provision rendered unenforceable? See Arbitration.

Ries v. City of Chicago, No. 109541 – (1) Are the defendants entitled to immunity from liability pursuant to Section 106(b) of the Tort Immunity Act for their alleged conduct in failing to terminate pursuit of an escaped prisoner? (2) If so, does the statutory exception allowing liability for willful and wanton behavior , found in Section 202 of the Act, apply to Section 4-106(b) immunity? See Government Law.

Johnston v. Weil, No. 109693 – Whether evaluations, communications, reports and information relating to a mental health professional’s independent evaluation in connection with custody dispute are confidential pursuant to the Mental Health and Developmental Disabilities Confidentiality Act (the “Confidentiality Act”), 740 ILCS 11/1 et seq.? See Domestic Relations.

In re Application of the County Collector of DuPage County for Judgment for Taxes for the Year 1999, No. 109711 – Does the Pension Code require a Forest Preserve District to pass an appropriation ordinance setting the amount of its mandatory contribution to the Illinois Municipal Retirement Fund before the District may validly enact a tax to pay for that contribution? See Taxation.

Kaufmann v. Jersey Community Hospital, No. 109738 – Where the defendant doctor allegedly committed a "deviant act of sex" upon the plaintiff during an allegedly unnecessary examination, did the patient's injury "aris[e] out of patient care," meaning that the two-year statute of limitations found in 745 ILCS 10/8-101(b) applied, or did the one-year statute found in Section 101(a) of the statute apply? See Government Law.

Follow me below the jump for the last two days of the Court's docket.

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In Illinois, as in many states, a defendant can't include settled defendants on the verdict form, seeking an apportionment of fault.

So is there a way to make a settled defendant's conduct admissible?

Last week, the Illinois Supreme Court answered "yes."

Ready v. United/Goedecke Services arose from the death a construction worker in an accident at a power plant. The decedent's administrator sued the general contractor and the scaffolding subcontractor, and the defendants cross-claimed against the decedent's employer. The administrator settled with the general contractor and the employer, and went to trial against the subcontractor.

The subcontractor alleged as an affirmative defense that the accident was caused in whole or in part by others.

Plaintiff moved in limine to keep out all evidence of the settling defendants' conduct. The Appellate Court held that a defendant's fault should be assessed under 735 ILCS 5/2-1117 compared to all other defendants, including settled defendants, so evidence of their conduct was relevant and admissible. In 2008, the Supreme Court reversed, holding that settling defendants could not be apportioned liability under 735 ILCS 5/2-1117. The Court remanded for consideration of the defendant's sole proximate cause defense.

On remand, the Appellate Court sent the case back to the trial court, holding that the Circuit Court erred by excluding evidence of the defendants' conduct, and the Supreme Court once again allowed an appeal.

The Supreme Court reversed. The Court held that the Circuit Court should have permitted evidence of the settled defendants' conduct with respect to the defendant's sole proximate cause defense, and instructed the jury on the defense. Nevertheless, the Court declined to order a new trial, finding the error harmless.

The lesson for Illinois defense lawyers: just because your co-defendants have settled out doesn't mean that an empty chair defense is unavailable.

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The Supreme Court has granted review in two civil cases:

• Aryeh v. Canon Business Solutions, Inc., S184929, in which the Court will address the application of the continuing violation doctrine, the continuous accrual doctrine, and the delayed discovery rule to actions brought under the Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.). For more details regarding Aryeh, see the B & P 17200/Class Actions/Commercial update page.

• City of Alhambra v. County of Los Angeles, S185457, in which the Court will address whether a county is barred from taking into account money diverted to a city from the county’s Educational Revenue Augmentation Fund when determining that city’s share of costs incurred by the county in assessing and allocating property taxes. For more details about City of Alhambra, see the Taxation and Assessments update page.
   

 

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The Illinois Supreme Court announced this afternoon that on the morning of Thursday, October 21, it will file opinions in four civil cases:

• J. P. Morgan Chase Bank, N.A. v. Earth Foods, Inc., No. 107682 -- Does Section 1 of the Sureties Act, 740 ILCS 155/1, also apply to guarantors?
   
• In re Estate of Wilson, No. 108487 -- Does 735 ILCS 5/2-1001(a)(3) of the Code of Civil Procedure permit a judge to make an initial determination of whether a petition to substitute judges for cause makes a threshold showing of prejudice before transferring the matter to another judge for decision?
   
• Ready v. United/Goedecke Services, Inc., No. 108910 -- Where a defendant has denied liability, may defendant introduce evidence regarding the conduct of other defendants who have settled in good faith pre-trial for the purpose of showing that one or more of the settling defendants were the sole proximate cause of plaintiff’s injuries?  
   
• Wright Development Group, LLC v. Walsh, No. 109463 -- (1) Where the Citizens' Participation Act gives a defendant successfully moving to dismiss an action a right to an award of attorneys' fees and costs incurred in connection with the motion (735 ILCS 110/25), was defendant's appeal from denial of his motion to dismiss mooted by the subsequent dismissal of the action on other grounds?  (2) If not, was defendant entitled to dismissal of the defamation action pursuant to the Act?

For further details on these four cases, click our Illinois Supreme Court Update, and then Surety, Civil Procedure, Tort, and Civil Procedure, respectively.

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A public utility, Pacific Gas and Electric Company, owns easements across rural properties traversed by its electric transmission lines.  The easements typically, as here, authorize PG&E to trim vegetation in the vicinity of its power lines to prevent accidental contacts that can cause fires and related damages.  After such a fire caused massive and widespread destruction and power outages in the Northeast and southern Canada in 2003, PG&E and other utilities across the country began trimming more aggressively to prevent, to the extent possible, accidental contacts.  The California Public Utilities Commission had regulated the vegetation management practices of the state’s utilities, establishing minimum (but not maximum) power line clearances.

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The Court will hear oral argument on four civil cases this November, addressing a variety of issues:

• Cassel v. Superior Court. (Wasserman, Comden, Casselman & Pearson),S178914: (1) Are the private conversations of an attorney and client for the purpose of mediation entitled to confidentiality under Evid. Code §§1115 through 1128? (2) Is an attorney a "participant" in a mediation such that communications between the attorney and his or her client for purposes of mediation must remain confidential under Evid. Code §§1119(c) and 1122(a)(2)? Oral argument is scheduled for 11/2/10. For more details about Cassell, see the Attorney-Related update page

• Kwikset Corp. v. Superior Court, S171845: Does a plaintiff’s allegation that he purchased a product in reliance on the product label’s misrepresentation about a characteristic of the product satisfy the requirement for standing under the Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.) that the plaintiff allege a loss of money or property, or is such a plaintiff unable to allege the required loss of money or property because he obtained the benefit of his bargain by receiving the product in exchange for the payment? Oral argument is scheduled for 11/3/10. For more details about Kwikset, see the Torts & Products update page.

• In re Enforcement Against Dana Point Safe Harbor Collective of City of Dana Point City Council Subpoena, S180365: Is an order compelling compliance with a legislative subpoena issued under Gov. Code § 37104 appealable as a final judgment? This issue is raised in several consolidated matters after the Court of Appeal issued a series of unpublished orders that the underlying was not an appealable order and could only be challenged by petition for extraordinary writ. Oral argument is scheduled for 11/2/10. For more details about these consolidated matters, see the Appeals & Writs update page.

• International Assn. of Firefighters v. Public Employee Relations Bd., S172377: (1) Is the decision by the Public Employee Relations Board not to issue an unfair labor practices complaint under the Meyers-Milias-Brown Act (Gov. Code, § 3500 et seq.) subject to judicial review? (2) Is a decision to lay off firefighters for fiscal reasons a matter that is subject to collective bargaining under the Act? Oral argument is scheduled for 11/3/10. For more details about International Assn. of Firefighters, see the Employment -Other update page.
   

 

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Last week, the Illinois Supreme Court allowed petitions for leave to appeal in eight new civil cases. They are:

• Sheffler v. Commonwealth Edison Co., 399 Ill.App.3d 51 (1^st Dist., 2010), which involves the question of whether a complaint seeking injunctive and damages relief in connection with defendant’s alleged failure to give priority, in restoring power after storms, to customers dependent on electric life support system, fell within the exclusive jurisdiction of the Illinois Commerce Commission;
   
• Genius v. County of Cook, 398 Ill.App.3d 321 (1^st Dist 2010), which involves the question of whether the Cook County Employee Appeals Board had jurisdiction to decide disciplinary charges against officer based upon abolished rules;
   
• Italia Foods, Inc. v. Sun Tours, 399 Ill.App.3d 1038 (2^nd Dist., 2010), which involves the question of whether federal Telephone Consumer Protection Act required that Illinois legislature enact enabling legislation before private claims under the TCPA could be heard in state courts;
   
• Board of Education of Auburn Community Unit School Dist. No. 10 v. Illinois Department of Revenue, 398 Ill.App.3d 629 (4th Dist. 2010), which involves the question of whether the Property Tax Extension Limitation Law applied to all portions of a community unit school district following annexation of territory in a separate county which had not opted into PTELL;
   
• Vincent v. Alden-Park Strathmoor, Inc., 399 Ill.App.3d 1102 (2^nd Dist. 2010), which involves the question of whether a claim for common law punitive damages pursuant to the Nursing Home Care Act survives the death of the patient;
   
• Palm v. 2800 Lake Shore Drive Condominium Association, 401 Ill.App.3d 868 (1^st Dist. 2010), which involves the question of whether provisions of the Chicago Condominium Ordinance requiring production of documents were preempted by purportedly conflicting Illinois state law;
   
• A.B.A.T.E. of Illinois, Inc. v. Giannoulias, 401 Ill.App.3d 326 (4^th Dist. 2010), which involves the question of whether statute permitting the transfer of funds from the Cycle Rider Safety Training Fund to the General Revenue Fund violated the takings clause of either the federal or state constitutions; and
   
• Phoenix Insurance Co. v. Rosen, [Rule 23 Order] (1^st Dist. 2010), which involves the question of whether the provision permitting trial de novo following arbitration was void and unenforceable pursuant to public policy.

For further details on all of these cases, click the "Illinois Supreme Court Update" to the right of this page.

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The Court has recently granted review in two civil cases:

• Ralphs Grocery v. United Food & Commercial Workers Union, S185544, in which the Court of Appeal, formerly 186 Cal.App.4th 1078, held that the state cannot force the owner or possessor of real property that is not a public forum to give an uninvited group (in this case, a union) access to private property to engage in speech based on the content of the speech, in light of the First and Fourteenth Amendments of the U. S. Constitution. The Supreme Court will also address whether the parking area and walkway in front of the entrance to plaintiff’s retail store, which is part of a larger shopping center, constitute a public forum under Robins v. Pruneyard Shopping Center and its progeny. For more details, see the Civil Rights update page.

• American Nurses Ass. v. O'Connell, S184583, in which the Court of Appeal, formerly at 185 Cal.App.4th 393, held that current California law does not allow designated voluntary school personnel, who are not licensed nurses, to administer insulin to diabetic students who require the injections under a Section 504 Plan (29 U.S.C. § 794; 34 C.F.R. § 104.1 et seq.) or Individualized Education Program (IEP) (20 U.S.C. § 1414(d)), and affirmed an injunction barring the practice. The Supreme Court will also address whether state law is preempted by federal law requiring equal access to education. For more details, see the Other update page.
   

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An insurance policy required that the insured "immediately record the specifics of the claim" and "see to it that we receive written notice of the claim . . . as soon as practicable."

The insured waited 27 months before giving its insurer written notice of a defamation suit.

The Appellate Court held that the insured had breached the written notice clause, and that the presence or absence of actual notice had no bearing on the issue.

But last week, a divided Illinois Supreme Court reversed. West American Insurance Co. v. Yorkville National Bank, [pdf] No. 108285.

The plaintiff offered testimony of several casual contacts with representatives of the insurer following the filing of the lawsuit.

The president of the insured told an insurance agent "in passing" that the insured had "a defamation suit in Ottawa" -- the suit was in Joliet -- and it was a "he said/she said sort of thing." The president said nothing about when the alleged defamation took place, nor did he provide the agent with a copy of the complaint, nor did he offer to send any additional information. The agent said the suit was "probably not" covered, but the president never pursued the matter.

Later, the president met another insurance agent. He vaguely referred to a defamation suit and asked whether the policy would cover it. The agent gave "basically the same response."

Finally, the defamation suit was briefly mentioned at three meetings of the bank board of directors, although apparently no information was recounted about where the suit was filed, when the incident allegedly took place, or who the parties to the lawsuit were.

The majority held that the timeliness of an insured's notice was judged by a five factor test: (1) the specific language of the policy's notice provision; (2) the insured's sophistication in commerce and insurance matters; (3) the insured's awareness of an event that may trigger insurance coverage; (4) the insured's diligence in ascertaining whether policy coverage is available; and (5) prejudice to the insurer.

 The Court held that the first factor weighed in neither direction, and the second and third weighed against a finding of reasonable delay.

However, the Court held that the fourth factor weighed heavily in favor of a finding of reasonableness. An insurer is deemed to have "actual notice," the Court found, where it has sufficient information to locate and defend the suit. The Court held that the casual conversations between officers of the insured and various agents were sufficient for the insurer to "locate and defend" the action, and taken together, the factors weighed in favor of finding the insured's delay in notice reasonable.

Justice Charles Freeman dissented. "[I]t is apparent," Justice Freeman wrote, "that [the insured] breached each and every reporting obligation it agreed to as a condition of coverage."

Justice Freeman strongly condemned the majority's decision:  

By ignoring the settled rules of insurance policy construction . . . the majority redirects the focus of analysis away from compliance with policy provisions to an unworkable and problematic case-by-case examination, requiring swearing contests between the insurer and insured as to whether and when notice was provided . . . today's opinion . . . effectively overrules decades of precedent establishing that notice provisions are conditions precedent to coverage under a policy.

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Last week, the Illinois Supreme Court filed opinions resolving four new civil cases:

• Hubble v. Bi-State Development Agency of the Illinois-Missouri Metropolitan District, [pdf] No. 109137 -- In a personal injury action, the Court held that the Bi-State Development Agency, which was created by an interstate compact between Illinois and Missouri, is a "local public entity" within the meaning of the Local Governmental and Governmental Employees Tort Immunity Act. Therefore, a one-year statute of limitations applied, and the action was barred.
   
• Hurlbert v. Charles, [pdf] No. 109041 -- In an action for malicious prosecution, the Court held that the doctrine of collateral estoppel did not apply to the finding of probable cause in plaintiff's driver's license statutory summary suspension hearing following a DUI arrest.
   
• Irwin Industrial Tool Company v. The Illinois Department of Revenue, [pdf] No. 109300 -- In a case brought under the Use Tax Act, the Court held that there was a substantial nexus between a corporate airplane and the state of Illinois such as to permit the Department of Revenue to impose a use tax on the sale. The Court further held that the Act's provision of a credit for sales taxes paid in other states satisfied the fair apportionment requirement of the Federal Commerce Clause.
   
• K. Miller Construction Company, Inc. v. Joseph J. McGinnis, [pdf] No. 109156 -- In an action for breach of contract and quantum meruit, the Court held that where a contractor performed home remodeling work in excess of $1,000 value on an oral contract, in violation of the Home Repair and Remodeling Act, the statutory violation did not render the contract unenforceable. The Court held that recovery was also available on a quantum meruit theory.

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The members of the Illinois Supreme Court have selected Supreme Court Justice Thomas L. Kilbride as the new Chief Justice. Justice Kilbride will begin his term on October 26, 2010, following the retirement of Chief Justice Thomas Fitzgerald.

Justice Kilbride received his law degree from Antioch School of Law in Washington, D.C. in 1981. He practiced law for twenty years in Rock Island, handling matters in a variety of areas, including environmental law, labor law, employment, and appellate law. He was elected to the Supreme Court in 2000, and is a candidate for another ten year term on the Court in the November 2010 election.

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The beginning of the Illinois Supreme Court's September docket was overshadowed this week by a surprise announcement from Chief Justice Thomas R. Fitzgerald. Chief Justice Fitzgerald told his colleagues that he had been diagnosed with Parkinson's Disease, and would retire from the Court effective October 25, 2010, rather than running for a full ten-year term.

Chief Justice Fitzgerald's retirement caps a distinguished thirty-four year career in the Illinois judiciary. Chief Justice Fitzgerald was elected as a Circuit Judge in Cook County in 1976 -- at the time, the youngest elected Judge in the county. After eleven years as a trial judge in the Criminal Court, the Chief Justice was assigned as Supervising Judge of Traffic Court. He was assigned as Supervising Judge of Traffic Court in 1989. Chief Justice Fitzgerald was elected to the Supreme Court in 2000.

Acting upon Chief Justice Fitzgerald's recommendation, the Court appointed Justice Mary Jane Theis of the Appellate Court, First Appellate District, to serve the remainder of Chief Justice Fitzgerald's term. Justice Theis served as an Associate Judge and later, a Circuit Judge before being elected to the Appellate Court in 1994. Once Justice Theis takes her seat, three of seven members of the Court will be women for the first time in state history.

Chief Justice Fitzgerald "has served the people of Illinois with honor and integrity," said Governor Quinn in a statement. The retiring Chief Justice "will be greatly missed." According to the Governor, "Justice Theis has demonstrated sound legal judgment and an unwavering commitment to finding truth and upholding the law of the land."

According to Supreme Court spokesman Joe Tybor, the Court will file its order naming one of its members Chief Justice later today.

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The California Supreme Court has released its annual report describing the operations of the Court from 2009 to 2010. The Court issued 105 opinions in this period, 42 of which were in civil cases. However, this does not account for the 30 habeas corpus petitions denied by order, so the court’s workload continues to be dominated by criminal matters. While the total filings with the court increased to 9,917 (from 9,556), the court’s output was reduced from 110 opinions in the prior year, and total dispositions decreased by almost 2%. One factor might have been the mandatory furlough, which decreased total work hours by over 4%. In addition, the last conference of the court was delayed into the next fiscal year to accommodate judicial confirmation hearings. Interestingly, the number of civil petitions for review decreased to 1,219 (from 1,307). This was offset by an increase in criminal filings, particularly habeas corpus petitions in non-capital criminal matters. Depublication orders reached a record low of four, beating the previous record of ten in 2007-2008. This compares to the 1980’s and early 1990’s, in which the court regularly depublished over 100 opinions each year. The Court issued a single publication order.

This follows a report by the AOC Office of Court Research on the fiscal year 2009, which shows that filings in the California Superior Court topped 10 million for the first time, a 7% increase from 2008 and a 20% increase over the last ten years. This reflects an increase in each major category (civil, criminal, family and juvenile) although the largest increase was in civil filings –with unlimited civil filings increasing more than 17% and limited civil filings increasing almost 14%. The increase in unlimited civil filings was largely driven by nontort cases, as the number of tort cases filed only increased by 2%. While data on unlimited filings in incomplete, a similar trend is apparent.
 

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• Pineda v. Bank of America addresses the controlling statute of limitations over a claim to recover penalties for the late payment of final wages and whether such penalties can be recovered under Bus. & Prof. Code § 17203. For more details on Pineda, see the Employment – Compensation & Benefits update page.

• Conservatorship of Roy W addresses whether a prevailing party can be denied attorney fees under C.C.P. § 1021.5 because the prevailing party had a significant non-pecuniary personal interest in the outcome of the litigation. For more details on Roy W, see the Attorney-Related update page.

• Martinez v. Regents of University of California addresses a challenge by out-of-state U.S. citizens regarding the validity under federal law of Education Code § 68130.5, which provides that undocumented aliens are exempt under certain circumstances from paying the nonresident tuition at State University and California Community Colleges which out-of-state U.S. citizens are required to pay. For more details on Martinez, see the Other update page.
   

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The Supreme Court has granted review to again address preemption, this time in the timely area of consumer protection and banking. In Parks v. MBNA American Bank, the Court of Appeal reversed a judgment on the pleadings, finding that Civil Code § 1748.9, a state consumer protection law which mandates specific notice requirements regarding the use of preprinted checks (aka convenience checks) as an advance on credit card accounts, was not preempted by the National Bank Act (12 U.S.C. § 21 et seq.) on its face. For more details about Parks, see the B & P 17200/Class Actions/Commercial update page.

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This case arises out of an insured’s claim against its insurer for property damages caused by an earthquake that struck the Los Angeles area in 1984.  After a protracted dispute (during which the insurer made substantial payments) over the value of the claimed damages, and the extent to which they were earthquake-related, the parties entered into a settlement agreement.  The insurer agreed to pay an additional $1.5 million, and the insured executed a standard release by which it waived its right to recover any undiscovered damages and agreed to forbear bringing suit on any and all claims, known or unknown.

Several years later, the insured brought a lawsuit seeking to recover additional damages under the policy.  It argued that it was fraudulently induced into entering into the settlement agreement and that under general contract principles it could elect to affirm the agreement (and thus keep the money it had already received) and sue for damages caused by the alleged fraud.  The trial court, relying on decades of precedent from the Supreme Court and the Court of Appeal, as well as the statutory scheme governing settlements and releases, granted dispositive motions in favor of the insurer.  The authorities, the court said, made clear that a party seeking to undo a settlement agreement must seek rescission and return any monies obtained as consideration for the release.  The Court of Appeal reversed.  Distinguishing the prior authorities on the basis that they involved third-party personal injury claims, rather than first-party breach of contract claims, the court found that public policy supports the rule (followed in several jurisdictions) that a policyholder may affirm, keep the money, and sue, despite having executed a full release.

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The California Commission on Judicial Appointments has unanimously confirmed the nomination of Associate Justice Tani Gorre Cantil-Sakauye, of the Third Appellate District of the Court of Appeal (Sacramento), as the new Chief Justice of California.

In the same session, the Commission also confirmed by unanimous vote: 

• The appointment of Judge Louis R. Mauro, of the Superior Court of Sacramento County, as an Associate Justice of the Court of Appeal, Third Appellate District

• The nomination of Judge Carol D. Codrington, of the Superior Court of Riverside County, as an Associate Justice of the Court of Appeal, Fourth Appellate District, Division Two (Riverside).

• The nomination of Associate Justice Brad R. Hill, of the Court of Appeal, Fifth Appellate District (Fresno), as Presiding Justice of the Court of Appeal, Fifth Appellate District.

Justices Cantil-Sakauye, Codrington and Hill will stand for election in their new positions in the November 2010 election.
 

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The Illinois Supreme Court has announced its oral argument calendar [pdf] for the upcoming September term, and it contains just one civil case. On September 22, 2010, the Court will hear argument in Hossfeld v. Illinois State Board of Elections, No. 109725.  Hossfeld involves the question of whether the appellant was a qualified primary voter for the Republican Party, such that his “Statement of Candidacy” in the February 2010 Republican primary for State Senator was valid, and he was therefore entitled to be on the ballot.  For more information on Hossfeld, click “Election Law” in the Illinois Supreme Court Updates.

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In a case brought to enforce a settlement reached at mediation, a dispute arose about the final terms of the settlement reached. One of the parties offered the declaration of the mediator to confirm the accuracy of the attached agreement. In Radford v. Shehorn, the Second District Court of Appeal held this was inadmissible under Evidence Code § 703.5, which declares that a mediator is incompetent "to testify, in any subsequent civil proceeding, as to any statement, conduct, decision, or ruling, occurring at or in conjunction with the prior proceeding...." The court ruled that this extended to a statement regard the terms of any agreement reached. While the parties can waive this restriction, in Radford the dispute extended to whether the signed waiver was actually part of the agreement. With that in dispute, the mediator remained barred from testifying. Ultimately, this error was found harmless, as a declaration of counsel confirming receipt of the agreement from opposing counsel was found sufficient to identify the final agreement. Note: Radford is consistent with an earlier case, Eisendrath v. Superior Court (2003) 109 Cal.App.4th 351, which barred a party from deposing the mediator in an action to correct the written agreement signed at the mediation.

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• Murray v. Alaska Airlines, Inc. holds that collateral estoppel applies to the administrative findings of a federal agency when those findings were subject to objection and judicial review that was never pursued, resulting in a final nonappealable order based on those findings. The Court found that in a subsequent civil lawsuit, those administrative findings have an issue-preclusive effect against the claimant who failed to challenge those findings and allowed them to become a final order and also failed to take any steps to withdraw his administrative complaint. For more details about Murray, see the Civil Procedure/Evidence/Discovery update page.

• Ruiz v. Podolsky holds that an arbitration agreement between a patient and treating physician extends to compel the heirs of that patient to arbitrate a wrongful death lawsuit when the agreement so extends by its own terms. The Court found that this result was compelled by C.C.P. § 1295, which by its terms intended to extend the arbitration of medical malpractice allegations to wrongful death claims. For more details about Ruiz, see the ADR update page.
   

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Labor Code § 351 bars an employer from collecting any gratuity that is left for an employee. Previous cases have addressed whether various tip pooling systems (i.e. systems which pool gratuities for division among a set of employees) operated by the employer are permitted under Labor Code § 351. Facing a split in the Court of Appeal on the existence of a private cause of action by the employee, the Supreme Court did not address the issue of whether the tip pooling system imposed in Lu v. Hawaiian Garden Casino was permitted. Instead, the Court unanimously ruled that Labor Code § 351 does not authorize a private right of action to sue an employer for allegedly taking gratuities. Finding no statutory language or legislative intent to provide such a remedy, the Court declined to create one. For more details about Lu, see the Employment-Compensation & Benefits update page.

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This week the Supreme Court granted review in three civil cases, covering a variety of issues:

• Greb v. Diamond International, in which the Court of Appeal, formerly at 184 Cal.App.4th 15, held that Delaware Gen. Corp. Law § 278 and not California Corp. Code § 2010 controlled whether a California plaintiff alleging personal injuries from asbestos could pursue a claim against a dissolved Delaware corporation when the complaint was filed more than three years after the dissolution of the corporation, thus barring the claim. For more details, see the Civil Procedure/Evidence/Discovery update page.

• Serrano v. Stefan Merli Plastering, in which the Court of Appeal, formerly at 184 Cal.App.4th 178 affirmed the denial of attorney’s fees under C.C.P. § 1021.5, finding that the trial court was within its discretion following Adoption of Joshua S. (2008) 42 Cal.4th 945, on the grounds that plaintiffs were protecting their own interests and only inadvertently triggered a published opinion which may have benefited others. For more details, see the Attorney-Related update page.

• Retired Employees Assoc. v. County of Orange, in which the Court certified review of the following issue: Whether, as a matter of California law, a California county and its employees can form an implied contract that confers vested rights to health benefits on retired county employees. For more details, see the Employment – Compensation & Benefits update page.

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In Clark v. Superior Court, the Supreme Court considered the claims of elderly plaintiffs under California’s unfair competition law, Business & Professions Code, § 17200 et seq., which sought treble damages under Civil Code § 3345. Under Civil Code § 3345, which is part of the Consumers Legal Remedies Act, the trier of fact is authorized to impose a penalty (i.e. a remedy intended to punish or deter) three times greater than otherwise provided for by the authorizing statute, when considering specified types of conduct regarding claims brought by or on behalf of elderly or disabled persons. If the statute does not provide a specific amount, then the trier of fact is authorized to increase the penalty it would otherwise have imposed, up to triple the original amount. The Court first ruled that § 3345 is not limited to claims brought under the Consumers Legal Remedies Act, but applies as a penalty enhancement for any claim which satisfies the terms of § 3345. However, following this statutory language, only “penalties” are potentially tripled, not compensatory damages. As such, the Court also ruled that § 3345 does not apply to claims brought under Business & Professions Code §17200, et seq., since the only monetary award provided for there is for restitution, which is not a “penalty” by definition. For more details about the Clark case, see the B & P 17200/Class Actions/Commercial update page.

 

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In Reid v. Google, the California Supreme Court addressed and resolved a well-known procedural trap for California attorneys: if you file your objections to your opponent’s evidence on a summary judgment motion, but the trial court never specifically rules on them, are the objections preserved on appeal? The Supreme Court’s answer: “yes.”

In opposing a summary judgment motion, Google made numerous written objections to its opponent’s evidence (175, in fact). The trial court failed to specifically rule on the objections, merely stating that it was “relying only on competent and admissible evidence” pursuant to Biljac. After reviewing the legislative history of C.C.P. § 437c  , the Court found that once an objection is properly made, it is not waived on appeal. If the trial court fails to rule on the objection it is considered overruled and the trial court is presumed to have considered the evidence, but the objection is preserved for appeal.

In doing so, the Supreme Court disapproved: 1) bothAnn M. and Sharon P. to the extent they each hold that the failure of the trial court to rule on objections to summary judgment evidence waives those objections on appeal; 2) Biljac to the extent it permits the trial court to avoid ruling on specific evidentiary objections; and 3) numerous court of appeal decisions which were contrary to this ruling (see footnote 7 of the opinion). For more procedural history of Reid v. Google, see the Summary Judgment update page.
 

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California, like most states, has enacted a statute (Civil Code section 846) which provides that property owners have no duty to maintain their premises in a manner that makes them “safe” for recreational users of the land.  The statute was intended to encourage landowners to make their property available for recreational use without fear of exposure to liability, and California courts have, in a number of cases, read the statute expansively to promote that goal.  One decision, by an intermediate California appellate court (Shipman v. Boething Treeland Farms, Inc., 77 Cal.App.4th 1424 (2000), held that “recreational use immunity” barred a claim by a recreational user that he was injured by the landowner’s negligent operation of a motor vehicle on the property.

In Klein v. United States of America, __Cal.4th__ (July 26, 2010), plaintiff was riding a bicycle on a paved road in a National Forest when he was struck by a vehicle driven by a Park Service employee.  Under governing law, the liability of the United States was controlled by California tort principles.  A lawsuit was brought in federal district court, where summary judgment was granted in favor of the government based upon Shipman and other California authorities applying Section 846.  On appeal, the Ninth Circuit certified to the California Supreme Court the question whether Section 846 immunizes the landowner from negligent activities on the premises, or only from claims arising out of the nature and condition of the property itself.  The Ninth Circuit questioned whether Shipman was correctly decided, suggesting that the reasoning of certain Supreme Court opinions, while not directly on point, questioned its validity.

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Governor Arnold Schwarzenegger has named Associate Justice Tani Cantil-Sakauye of the California Court of Appeal as his choice to replace the retiring Hon. Ronald M. George as Chief Justice of the California Supreme Court.

Governor Schwarzenegger praised Justice Cantil-Sakauye's record in announcing the nomination:

Justice Tani Cantil-Sakauye has a distinguished history of public service and understands that the role of a justice is not to create law, but to independently and fairly interpret and administer the law.

Justice Cantil-Sakauye has served on the Third District Court of Appeal in Sacramento since 2005. Prior to joining the Court of Appeal, she was a superior court judge and earlier a municipal court judge, serving in each position for seven years. Justice Cantil-Sakauye was a deputy district attorney for Sacramento County from 1984 to 1988, before serving for two years in Governor Deukmejian’s administration.

Justice Cantil-Sakauye is a member of the California Judicial Council, where she serves as Vice Chair of the Rules and Projects Committee, chair of the Advisory Committee on Financial Accountability and Efficiency and co-chair of the Judicial Recruitment and Retention Working Group. She has served as a Special Master since 2007, appointed by the Supreme Court to conduct disciplinary proceedings before the Commission on Judicial Performance.

"It is a privilege and a tremendous honor to have the opportunity to serve as Chief Justice of the California Supreme Court," said Justice Cantil-Sakauye. “I deeply respect the inspirational and visionary work of Chief Justice Ronald George and hope to build upon it.”

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Snow and ice are a fact of life in Chicago during the winter months. So what duties of care do government agencies, individuals and businesses have in relation to dealing with winter conditions? The Illinois Supreme Court addressed this important issue late last week in Krywin v. The Chicago Transit Authority [pdf].

Illinois has long followed the "natural accumulations rule": a landowner or possessor of real property has no duty to remove natural accumulations of ice, snow or water from its property. But it's equally true that because mass transit agencies are "common carriers" under the law, they have a duty to their passengers to exercise the highest degree of care, not only to carry them safely to their destinations, but to provide them with a reasonable opportunity to leave the conveyance safely.

So does the natural accumulations rule apply to mass transit? In Krywin, a divided Supreme Court answered "yes."

Krywin arose from a 2005 accident, when plaintiff slipped on an icy subway platform owned by the Chicago Transit Authority. Plaintiff sued the CTA in a two-count complaint, alleging negligence and willful and wanton conduct. The trial court allowed a limited version of plaintiff's theory to go to the jury, and the jury returned a verdict for plaintiff. The Appellate Court reversed.

Before the Supreme Court, Krywin argued that the natural accumulations rule has always been based on the proposition that it is unfair and unrealistic to require municipalities and businesses to remove snow and ice on an ongoing basis while a storm continues. The Court disagreed, finding that the rule applies regardless of whether a storm is in progress, or how long a natural accumulation has existed. The Court concluded that the natural accumulation rule should apply to plaintiff's claim:

CTA had no duty to remove the natural accumulation of ice and snow from its platform, nor any duty to warn of the existence of such natural accumulation.

Plaintiff's fallback argument was that even if the natural accumulations rule applied to common carriers, the CTA could have met its duty to provide a safe place to alight by stopping under the canopy which covered less than half of the platform. The Court disagreed, finding that it was impractical to require the CTA to evaluate each platform each time a train pulled in to determine what portions of the platform, if any, were the most free of snow and ice.

Justice Freeman dissented, with Justice Kilbride joining. Justice Freeman argued that because the Illinois Legislature had codified the natural accumulations rule in the Local Governmental and Governmental Employees Tort Immunity Act, 745 ILCS 10/3-105, but had specifically excluded the CTA from the Act, 745 ILCS 10/2-101(b), the Legislature intended that the natural accumulations rule not apply to the CTA.

Justice Freeman also argued that the majority's holding was contrary not only to the Court's earlier authorities, but also to the weight of authority in foreign jurisdictions. Pointing to decisions of the Alaska and Michigan Supreme Courts, as well as Section 343 of the Restatement (Second) of Torts, Justice Freeman argued that the weight of authority around the country rejected the natural accumulations rule. "I would hold that a common carrier's standard of care trumps the natural accumulation rule," Justice Freeman wrote, arguing that the CTA should be required to warn passengers of icy platforms, and "a jury would have to decide whether the parties acted reasonably."

Ironically, the "take-away" from Krywin comes from Justice Freeman's dissent. "[I]n northern climates, like ours, where ice and snow are a fact of life, people are aware of the hazards posed by such conditions, and it is impractical to require property owners and carriers to remove snow and ice." The Court's decision in Krywin provides a needed dose of common sense for defense counsel to fight suits arising from the difficult winter weather that is a "fact of life" here in Chicago.

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California Chief Justice Ronald M. George has announced today that he will be retiring from the Court, effective January 2, 2011. We will have a profile of this great California jurist soon.

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The Illinois Supreme Court announced yesterday afternoon that it will release two opinions [pdf] on the morning of Thursday, July 15^th, including one civil case:

• No. 108888, Krywin v. Chicago Transit Authority, which presents the issue of whether the “natural accumulations rule,” which provides that a business owner generally has no duty to take precautions against natural accumulations of snow and ice, trumps a common carrier’s duty to furnish a passenger an opportunity to safely alight and reach a place of safety?

For full details on Krywin, check our Illinois Supreme Court Update. Krywin can be found under the link for Torts.

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Earlier this week, we discussed “advice and consent.”  Can Senators legitimately ask a Supreme Court nominee about a hot button issue and expect a direct answer? Do Senators have the right to vote up or down on a particular nominee for purely political reasons?

Now we turn from the question of what the confirmation process should be to the issue of how the process operates in practice. Is the widely held view that hearings have become a substance-free charade in the years since the Bork nomination supported by the evidence? What subjects are Senators asking about, and are white, male nominees treated differently from women and African-American nominees? Two timely studies attempt to shed some light on these questions.

Professors Dian Farganis and Justin Wedeking, of Elon University and the University of Kentucky, respectively, focus on how responsive nominees are to Senators’ questions in their study, No Hints, No Forecasts, No Previews: Analyzing Supreme Court Nominee Evasiveness, 1955-2009.  Farganis and Wedeking reviewed the transcripts of every Supreme Court confirmation hearing since 1955 (Justice John Harlan), coding the type of question asked, the responsiveness of the nominee’s answer, and the reasons given by the nominee for not answering more fully.

In general, the professors found that the popular model of nominees trying to avoid nearly all the Senators’ questions was not supported by the transcripts: they consistently ranked nominees’ answers as “very forthcoming” for between sixty and eighty percent of all questions.  They argue that the perception that hearings have become a multi-day exercise in nominees avoiding substantive responses is likely caused by two factors.

First, the professors found that the percentage of questions addressing nominees’ opinions and interpretations – especially of hot-button issues – has increased over time, and such viewpoint questions are more likely to be partially or fully evaded than factual questions.

Second, the researchers observed an increasing trend in recent years of nominees being more explicit about declining to answer a question, most often because they worry that a particular issue might come before the Court. This second trend is most famously illustrated by Justice Scalia’s reluctance to answer questions from Senators Strom Thurmond and Arlen Specter [pdf - pp. 33-34, 86]  during his 1986 confirmation hearing about whether he considered Marbury v. Madison to be settled law.

The second study, May It Please the Senate: An Empirical Analysis of the Senate Judiciary Committee Hearings of Supreme Court Nominees, 1939-2009, comes from Professors Lori Ringhand and Paul Collins, of the University of Georgia Law School and the University of North Texas, respectively. Working from a database stretching back to the 1939 hearing for Justice Felix Frankfurter, Ringhand and Collins analyzed the topics addressed in the hearings. The results suggest that over the past seventy years, the hearings have had far more to do with politics and popular perceptions of the Court than they have with the Court’s actual day-to-day workload.

The biggest single group of substantive exchanges involved civil rights issues – race, gender and sexual orientation discrimination; freedom of speech and religion, and the right to privacy. Questions about nominees’ judicial philosophy occur less than half as often, and inquiries about statutory interpretation – what the Court spends much of its time doing – account for only about one percent of all exchanges. Interestingly, the study shows that Senators’ questioning of Judge Robert Bork was no more dominated by questions about his judicial philosophy than a number of other nominees’ hearings have been.

The researchers’ analysis of the impact of nominee race and gender on Senators’ examinations has received the most attention in the days since May It Please the Senate was posted, including from the New York Times the Volokh Conspiracy and PrawfsBlawg. According to the professors, minority candidates receive more questions about civil rights, judicial philosophy and criminal justice, and fewer about issues like federalism and statutory interpretation. Female nominees, on the other hand, receive fewer questions about civil rights, but more than men regarding judicial philosophy and federalism.

Both No Hints and May It Please the Senate are interesting reads, and important contributions to the study of politics’ impact on constitutional law. Many follow-up questions – some of which are mentioned in the studies themselves – suggest themselves for further research.

• For example, Professors Ringhand and Collins break down their subject categories in the aggregate, arguing, for example that issues like abortion and the right to bear arms have not dominated the hearings; a similar breakdown along party lines might prove interesting.
   
• Professors Farganis and Wedeking show that nominees’ evasiveness tends to increase in response to viewpoint questions, but it might be useful to analyze that data further by specific issues and sub-issues.
   
• Both studies could throw additional light on the problems of twentieth and twenty-first century constitutional development by further analyzing their data with respect to the makeup of Congress at the time of each hearing, the party of the President, and the nature of the relationship between the Congress and the President.
   
• Finally, it would be interesting to tie the professors’ results with respect to specific nominees back into the nominees’ performance on the Court, and the group dynamic of the Courts on which they served.

UPDATE: Professors Farganis and Wedeking have posted an update to their paper analyzing the responses given by Solicitor General Kagan to Senators' questions during her confirmation hearings.

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Two Texas ranchers had a long-standing feud. During a drought, 13 of plaintiff’s cattle strayed from plaintiff’s ranch to defendant’s property along a dry river bed. Defendant rounded up the cattle and sold them, despite warnings from the ranch hands that the cattle were not his.

Plaintiff brought a conversion action and prevailed at trial. The jury awarded $5,327.11, the price of the cattle and $1.25 million in punitive damages. Because the jury also found that defendant had violated a felony statute, the statutory caps on punitive damages did not apply and the trial court awarded the entire amount of the verdict.

In Bennett v. Reynolds (.pdf), the Texas Supreme Court held that the facts warranted the imposition of punitive damages despite the absence of bodily injury or crushing pecuniary loss. The deliberate taking of another person’s cattle fit the statutory definition of “malice.”

The court also considered the extent to which a fact-finder could consider conduct separate from the underlying tort in determining liability for punitive damages. Defendant had allegedly attempted to bribe and threaten witnesses, tamper with the evidence, and bring meritless litigation against witnesses. The court held that the jury could consider these acts in determining the reprehensibility of the defendant’s conduct. “Obviously, a tortfeasor’s attempts to cover his tracks and escape responsibility can imply willfulness.”

Nevertheless, the court reversed the judgment. The award exceeded the permissible ratio of compensatory to actual damages established in State Farm Mut. Auto. Ins. Co. v. Campbell (.pdf). That case held that, except for particularly egregious cases, a 4:1 ratio neared the outer bounds of constitutionally permitted punishment. The case before the court was not sufficiently serious to warrant a deviation from this guideline. The court remanded the case for reassessment of punitive damages in light of the opinion.

AUTHOR’S NOTE: The great-grandfather of the author of this post was forced to leave Texas for a brief time after he and a neighbor captured a livestock thief on his ranch. They issued a “summary judgment” which led to the kind of punitive measures that cannot be corrected on appeal.

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In Tverberg v. Fillner Construction, Inc., the Supreme Court resolved a conflict in the lower courts by holding that the peculiar risk doctrine does not make a hiring party liable for workplace injuries of an independent contractor or subcontractor. In doing so, the Court departed from the rationale in Privette, holding instead that an independent contractor, unlike an employee, has the ability to determine the manner in which inherently dangerous construction work will be performed, and thus assumes legal responsibility for carrying out the contracted work, including the selection of workplace safety precautions. Having assumed responsibility for workplace safety, an independent contractor is barred from holding a hiring party vicariously liable for injuries resulting from the contractor’s own failure to effectively guard against the inherent risks of the contracted work. As such, the Court reversed, while upholding the result, if not the specific rationale, in Michael v. Denbeste Transp., Inc. (2006) 137 Cal.App.4th 1082. For more Tverberg case history, see theTorts & Products update page.

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The Sarbanes-Oxley Act of 2002 created the Public Company Accounting Oversight Board, an agency with broad authority to regulate accounting firms that perform audits of publicly-traded corporations. The Board is formally placed under the Security and Exchange Commission, but the Commission may only remove Board members pursuant to a stringent good cause requirement.

In Free Enterprise Fund v. Public Company Accounting Oversight Board (.pdf), the Supreme Court considered a challenge that the good cause removal provision violated separation of powers principles by creating a second level of employment protection for Board employees. (The majority opinion found that the SEC members themselves were removable only for good cause). The five-member majority, in an opinion authored by Chief Justice Roberts, held that the ability to remove inferior officers was an important part of the President’s power and obligation to ensure the faithful execution of the laws. The double layer of good cause protection for Board members effectively insulated them from presidential oversight, violating separation-of-powers principles.

Having won the battle, Petitioner then lost the war. The Court held that the invalid removal provisions were severable from the remaining provisions of Sarbanes-Oxley. Consequently, the Board action that Petitioner complained of was not invalid.

The dissenting opinion, authored by Justice Breyer, argued that the removal-for-good-cause provision was a valid exercise of legislative authority and that the majority’s ruling would call the authority of numerous other federal agencies into question.

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Supreme Court confirmation hearings have come in for a lot of criticism in recent years. They’ve been called a “Kabuki Dance” and a process which has “take[n] on an air of vacuity and farce.”

Amid all the discussion of whether or not nominees have become more evasive recently – a subject we’ll address later in the week – an important question has gotten somewhat less attention in our ongoing national conversation. What does the Senate’s duty to give “advice and consent” mean anyway? Is a Senator entitled to ask a nominee about a hot-button issue – abortion, guns, the death penalty – and expect an answer? Is it legitimate for a Senator to vote against a nominee because of a perception that she’s too liberal or too conservative?

The “advice and consent” language arose out of a lengthy debate in the Constitutional Convention, the result of a compromise to a long-ending battle between those who wanted the Congress – or the Senate alone – to appoint judges, and other delegates who would have assigned that power exclusively to the President. Reviewing the evidence, it seems difficult to believe that a majority of the Convention supported a pro forma Senate role in confirming Supreme Court nominees.

Anyone arguing that the Senate should play only a deferential role faces an additional barrier. There’s considerable evidence that most seventeenth and eighteenth century rejections – including at least one, John Rutledge, by a Senate which counted several Founders among its members – were for political reasons.

The story begins with Edmund Randolph’s “Virginia Plan,” which proposed a “National Judiciary . . . to be chosen by the National Legislature.” A few days later, one of America’s first great lawyers, James Wilson, criticized the proposal for Congressional appointment, arguing that judges should be appointed exclusively by the Executive Branch. Benjamin Franklin suggested that the Convention might consider other methods of selecting judges, noting that in Scotland, lawyers picked the judiciary:

[T]he Lawyers . . . always selected the ablest of the profession in order to get rid of him, and share his practice (among themselves).

James Madison didn’t like either Congressional or Presidential appointment, and successfully moved to put the question aside for a while.

The following week, the Convention returned to the question. Madison argued that if the appointment power was given to the entire Congress, members would tend to appoint one of their own. He proposed that the Senate make the selection, and the Convention agreed.

In the days that followed, William Paterson of New Jersey proposed the “New Jersey Plan,” which would have allocated the power to appoint judges exclusively to the President, and Alexander Hamilton proposed a compromise – Presidential appointment, “subject to the approbation or rejection of the Senate.” But for the time being, the Convention held fast to the idea of appointments by the Senate.

There the matter rested for a month. In mid-July, Nathaniel Gorham of Massachusetts proposed a model rooted in his own state’s constitutional practice – appointment by the President, with the advice and consent of the Senate. Gorham almost immediately picked up an important ally – James Wilson, a prime proponent of Presidential appointment. Roger Sherman of Connecticut, a supporter of Congressional appointment, indicated that he might be willing to settle for advice-and-consent as well, but other delegates weren’t convinced. Ultimately, the whole matter was handed over to the Committee on Detail, which reported a draft in early August restoring Senate appointment.

By early September, there seems to have been some sentiment in the Convention for cutting back slightly on the Senate’s power. The Committee on Compromise presented its report, once more calling for Gorham’s plan – Presidential appointment, with the advice and consent of the Senate. James Wilson, who had earlier supported Gorham, back-tracked, arguing for Presidential appointment subject to the non-binding advice of a “Privy Council,” but Wilson’s proposal received little support, and the Committee on Compromise’s “advice and consent” appointments clause was adopted.

So if the Senate wasn’t intended to defer to the President’s choice, what is a reasonable test for a Senator to apply in deciding whether or not to support confirmation? Join us below the jump for the views of three prominent players in Solicitor General Kagan’s confirmation.

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Yesterday, a divided U.S. Supreme Court affirmed the University of California, Hastings College of the Law’s right to condition official recognition of a Christian student group on the organization’s agreement to open eligibility for membership and leadership to all students – including homosexual students. In an opinion on behalf of a narrow 5-4 majority, Justice Ginsburg concluded the law school’s policy – that a registered student organization (“RSO”) allow any student to participate, become a member, or seek leadership positions in the organization, regardless of [her] status or beliefs – is a “reasonable, viewpoint-neutral condition on access to the student organization forum.” Justice Alito, who authored a vigorous dissent joined by the Chief Justice and Justices Scalia and Thomas, called the majority’s decision “a serious setback for freedom of expression in this country,” and characterized the ruling as a surrender to political correctness.

An initial and notable divide between the majority and the dissent is a disagreement over what law school policy was to be measured for constitutionality.  The law school maintains a published “non-discrimination policy” that prohibits student groups from “discriminate[ing] unlawfully on the basis of race, color, religion, national origin, ancestry, disability, age, sex or sexual orientation.” But at the district court level, both the law school and the Christian student group, the Christian Legal Society (“CLS”), had stipulated to the following characterization of the Hastings policy under which it was denied recognition: “Hastings requires that registered student organizations allow any student to participate, become a member, or seek leadership positions in the organization, regardless of [her] status.” Because of this stipulation, the constitutionality of this “all-comers policy,” as it was dubbed, was, according to the majority, the only question properly presented to the Court. The dissent rejected the assertion that the all-comers policy was merely an interpretation of the non-discrimination policy, and furthermore suggested that the law school’s all-comers policy was a pretext for discriminatory motives and litigation interests.

In its analysis, the majority first concluded that the limited-public-forum was the appropriate constitutional framework by which to measure the constitutionality of the all-comers policy.  The majority and Justice Stevens in a concurring opinion emphasized that the nature of the public forum at issue and the method by which Hastings influences it as warrants less than strict constitutional scrutiny. The majority stressed that “Hastings, through its RSO program, is dangling the carrot of subsidy, not wielding the stick of prohibition.” And Justice Stevens insists that it is appropriate for the law school to retain a measure of control over a “forum” it creates and funds: “[t]he RSO forum . . . is not an open commons that Hastings happens to maintain. It is a mechanism through which Hastings confers certain benefits and pursues certain aspects of its educational mission.”

Calling the all-comers policy “paradigmatically viewpoint neutral,” the majority distinguished the present case from precedents in Healy v. James 408 U.S. 169 (1972), Widmar v. Vincent, 454 U.S. 263(1981), and Rosenberger v. Rector and Visitors of Univ. of Va., 515 U.S. 819 (1995), by saying that in those prior cases, “we ruled that student groups had been unconstitutionally singled out because of their points of view.” In considering the reasonableness of Hastings’ policy, “taking into account the RSO forum’s function and ‘all the surrounding circumstances,’” the Court noted its considerable deference to the school administration’s judgment regarding its educational policy. The Court characterized the all-comers policy as ensuring that “leadership, educational, and social opportunities” remained available to all students, that it served as an aid to Hastings in helping to police its non-discrimination policy, that it “encourage[d] tolerance, cooperation, and learning among students” and finally that it was consistent with existing State anti-discrimination laws. The dissent was not so quick to conclude that the all-comers policy was viewpoint neutral, and was further alarmed by the deference afforded by the majority to the law school’s justifications in defense of its policy, characterizing this deference as an abdication of the Court’s “responsibility to exercise [its] own judgment.”

The reasonableness of the policy was bolstered in the eyes of the majority by the “substantial alternative channels that remain open for CLS-student communication to take place.” In light of whatever viewpoint-neutral access barrier the all-comers policy presented, alternative avenues in electronic media – social networking sites, internet message groups, and Google – lessened the burden on CLS’ First Amendment rights. The dissent flatly rejected this argument, saying “[t]his Court does not customarily brush aside a claim of unlawful discrimination with the observation that the effects of the discrimination were really not so bad.”

Finally, both the majority and Justice Kennedy in a concurring opinion rejected the proposition that an all comers policy that required student groups to accept members holding viewpoints or beliefs contrary to that of the student group could lead to “hostile takeovers” of groups such as CLS by “saboteurs” who could “infiltrate groups to subvert their mission and message.” The majority called this supposition “more hypothetical than real,” pointing to the absence of evidence of “RSO hijacking” at Hastings. To combat such intrusions, the Court emphasized that RSOs were free to condition eligibility for membership and leadership on other factors such as attendance, payment of dues, and other neutral requirements “designed to ensure that students join because of their commitment to a group’s vitality, not its demise.”

While the dissenters hoped that the Court’s decision “turn[s] out to be an aberration,” the Court’s ruling is poised to have a profound effect on a school’s right to define and control its roster of student organizations, and will certainly dictate the outcomes of identical litigation brought by CLS now pending before several lower courts across the country.

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It’s been a busy summer at the Circuits for decisions applying the antitrust state action immunity. First up, as we reported three weeks ago, was the Ninth Circuit’s affirmance of the dismissal in Shames v. California Travel and Tourism Commission, [pdf] in which the plaintiffs alleged the California Travel and Tourism Commission had colluded with the rental car industry to pass certain fees to customers. Now, hard on the heels of Shames, we have two more decisions: Danner Construction Co., Inc. v. Hillsborough County Florida [pdf] from the Eleventh Circuit, and Rectrix Aerodrome Centers, Inc. v. Barnstable Municipal Airport Commission [pdf] from the First.

In Danner, the Florida legislature had enacted a statute authorizing Hillsborough County to take “exclusive control” over solid waste disposal within its jurisdiction, and barring anyone other than the county or its franchisees from collecting or disposing of solid waste within the county. Acting under the statute, the county had passed an ordinance providing for awards of franchises for both residential and commercial waste collection. The County Commissioners set collection rates for residential service, but not for commercial service.

A disposal service and a commercial customer sued, arguing that both by restricting the commercial market and by setting below-market rates for residential service, the county’s ordinance essentially authorized price fixing in commercial service.

According to the Eleventh Circuit panel, antitrust claims against state entities are analyzed in two steps. First, the Court asks whether the statute or ordinance is preempted by the antitrust laws. If the answer is yes, the Court then applies the two part test for state action immunity set forth in Midcal to determine whether the challenged conduct is immune from antitrust liability.

The panel majority held that it was unnecessary to decide whether the statute and ordinance were preempted, because even if they were, the county’s conduct was immune under Midcal, since the county’s actions were a foreseeable result of a clearly expressed state policy.

The majority commented in dicta that state statutes can only be preempted when they purport to authorize per se violations of the antitrust laws – appearing to suggest that states can freely authorize rule of reason antitrust violations. The majority’s comment sparked a concurring opinion from Judge Beverly Martin. Judge Martin argued that when a plaintiff brought an “as applied,” rather than a facial challenge to a state action, the statute could be preempted under either per se or rule of reason analysis.

Last week, the First Circuit weighed in, affirming dismissal of antitrust claims in Rectrix. Massachusetts law requires any city or town that establishes an airport to also create an airport commission, which is empowered to lease land, acquire property, set charges and rentals, spend money, and make rules and regulations. Rectrix sued the Barnstable Municipal Airport Commission (BMAC), alleging that the BMAC had prevented it from competing with BMAC in the sale of jet fuel.

It might seem that a statute requiring cities and towns to create airport commissions with administer their airports falls far short of clearly articulating an intention to displace competition, but in fact, a number of Circuits have found state action immunity for similar airport authorities. The First Circuit followed this line of authority, as well as its own earlier decision interpreting the statute creating the Massachusetts Port Authority, Interface Group v. Mass. Port Authority, holding that the statute sufficiently authorized an exclusive dealing arrangement for sales of jet fuel at the airport. Since the plaintiff sued a government entity, rather than a private actor, the Court had no need to apply the second Midcal factor, which asks whether anticompetitive activity is actively supervised by the government.

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In Kleffman v. Vonage Holdings Corp., the Court addressed a legal question from the Ninth Circuit regarding the application of Business and Professions Code §17529.5(a)(2) to spam e-mails that were being sent from multiple domain names to avoid spam filters. While this statute bars spam which “contains or is accompanied by falsified, misrepresented, or forged header information” in an effort to curtail an explosion of spam traffic, the Court held that merely using multiple domain names did not violate this restriction, making the statute inapplicable unless the e-mail ran afoul of its restriction for some other reason. For more Kleffman case history, see the B & P 17200/Class Actions/Commercial update page.

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The Supreme Court of Florida, answering a question certified by the Eleventh Circuit Court of Appeals, recently held that posting defamatory material on a website about a Florida resident does constitute the commission of a tortious act within Florida for purposes of the State’s long-arm statute, section 48.193(1)(b), Florida Statutes, if the material on the website is accessible in Florida and is accessed by a third party in Florida.

In Internet Solutions Corporation v. Tabatha Marshall (.pdf), the defendant, Tabatha Marshall, a resident of the State of Washington, owned and operated a website on which she posted about consumer-related issues.  Plaintiff, Internet Solutions Corporation (“ISC”), was an employment and recruiting firm whose principal place of business was in Florida.  ISC filed a defamation action in federal court alleging that Marshall posted statements on her website claiming that ISC was engaged in certain ongoing criminal activity.  Marshall moved to dismiss the complaint for lack of personal jurisdiction on the basis that she had not committed a tortious act in Florida for purpose of Florida’s long-arm statute and that even if ISC could satisfy the long-arm statute, subjecting her to personal jurisdiction would violate her due process rights.  The district court ruled that Marshall was subject to personal jurisdiction under Florida’s long-arm statute, but determined that the exercise of jurisdiction under the circumstances would violate due process.  The complaint was dismissed. 

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The Eleventh Circuit, in Pretka v. Kolter City Plaza II, Inc. recently reexamined and rejected as dicta broad statements in Lowery v. Alabama Power Co., 483 F.3d 1184 (11th Cir. 2007), that limit the type of evidence used to establish the amount in controversy for removal.

The plaintiffs in Pretka, buyers of units in a new high-rise condominium in Florida, filed a class-action suit against the developer, Kolter City Plaza II, Inc., for rescission of their contracts and return of their deposits because of construction delays. The complaint did not specify the amount in controversy, stating only that the case was an action for monetary damages in excess of $15,000 (the jurisdictional requirement in Florida state courts). Kolter removed the case to the Southern District of Florida under the Class Action Fairness Act (CAFA), stating in the notice of removal that the $5 million amount-in-controversy requirement was met because the company had collected purchase deposits for units at the condominium totaling in excess of $5 million. Kolter attached to its notice a sworn declaration to this effect by the chief financial officer of Kolter’s parent company.

The plaintiffs filed a motion to remand, arguing that the Eleventh Circuit’s decision in Lowery required the district court to ignore the declaration because it was not a document received from the plaintiff.  Kolter filed an opposition to remand, submitting additional evidence, including the first three pages of every unnamed plaintiff’s contract whose deposit Kolter had not returned, and a sworn declaration from the contract and closing manager for Kolter’s parent company attesting that she had personally reviewed all of the contracts and financial records for purchase deposits and they totaled $41,183,226.08. At a hearing, the plaintiffs, relying on Lowery, argued that the district court was limited to the “four corners” of the documents the plaintiffs had provided to the defendants, and insisted that the two declarations and the contracts were “extraneous.”

The district court, relying on Lowery, remanded the case, ruling that Kolter had failed to prove by a preponderance of evidence that the amount in controversy exceeded $5 million. The court read Lowery as (1) barring consideration of the declarations and the unnamed plaintiffs’ contracts because none of them was “a document received by Defendant from Plaintiffs”; (2) requiring it to reject Kolter’s “impermissible speculation” on the “potential damage claim of putative class members, as opposed to named plaintiffs”; and (3) barring consideration of the second declaration and the unnamed plaintiffs’ contracts because Kolter did not submit them with its notice of removal.

The Eleventh Circuit reversed in a 72-page decision thoroughly examining the statements in Lowery that led to this result, and clarifying the law on evidence used to establish the amount in controversy. First the court distinguished Lowery because the record in Lowery “contained only ‘naked pleadings’—no specific factual details, no discovery, no affidavits or declarations, no testimony, no interrogatories and no exhibits other than the complaints.” Slip op. at 17. The court sought to clear up any misunderstanding of Lowery:

We stated in Lowery that “[t]he absence of factual allegations . . . is dispositive and, in such absence, the existence of jurisdiction should not be divined by looking to the stars.” But Lowery did not say . . . that the use of deduction, inference, or other extrapolation of the amount in controversy is impermissible, as some district courts have thought. . . . [W]hen a removing defendant makes specific factual allegations establishing jurisdiction and can support them . . . with evidence combined with reasonable deductions, reasonable inferences, or other reasonable extrapolations[,]   [t]hat kind of reasoning is not akin to conjecture, speculation, or star gazing.

The court also pointed out that in Lowery the defendant removed under the second paragraph of 28 U.S.C. § 1446(b), which provides that “[i]f the case stated by the initial pleading is not removable, a notice of removal may be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable . . . ,” whereas Kolter was relying on the first paragraph of § 1446(b), because Kolter filed its notice of removal within thirty days of being served with the summons and initial complaint. The court explained that while, in a “second paragraph” case the traditional rule is that only a voluntary act by the plaintiff may convert a non-removable case into a removable one, and an initially non-removable case cannot be converted into a removable one by evidence from the defendant, that rule (the “receipt from the plaintiff” rule) has no application to cases removed under the first paragraph of § 1446(b). 

The court rejected as unpersuasive dicta two statements in Lowery: that the “receipt from the plaintiff” rule is not limited to removals made under the second paragraph of § 1446(b) but also applies to first paragraph removals, and that the “receipt from the plaintiff” rule would apply to any case in which the complaint sought unliquidated damages. The court concluded that in Pretka, which arose under the first paragraph of § 1446(b), the evidence Kolter could use to establish the jurisdictional facts was not limited to what it received from the plaintiff, and that the district court erred in rejecting the declaration submitted with the notice of removal and the post-removal evidence—the contracts and the second declaration. With this evidence the defendants were able to establish the amount in controversy by a preponderance of the evidence, and the court instructed the district court to rescind the order remanding the case.

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Last week the Supreme Court granted review in six civil cases, covering a wide variety of issues:

 

• Coito v. Superior Court, which addresses when witness statements are protected from discovery as work product. See Civil Procedure/Evidence/Discovery update.

• Professional Engineers in California Government v. Schwarzenegger, which the Supreme Court transferred on its own motion before the Court of Appeal ruled on the issues raised, in order to expedite review of the Governor’s ability to mandate a furlough program on state employees. See Employment – Compensation & Benefits update.

• SeaBright Ins. Co. v. U.S. Airways, Inc., which addresses the ability of an injured employee of an independent contractor to hold the hirer of the contractor liable for the breach of statutory or regulatory non-delegable duty. See Torts & Products update.

• Oasis West Realty, LLC v. Goldman, which addresses counsel’s duty of loyalty to a former client when there is no subsequent representation and the attorney is acting on his or her own behalf. See Attorney-Related update.

• St. John’s Well Child & Family Center v. Schwarzenegger, which addresses the application of the governor’s line item veto to mid-year bills that reduce appropriations. See Other update.

• Episcopal Church Cases, in which the court returns to a case already reviewed to address whether the Court of Appeal properly implemented the court’s opinion. See Civil Procedure/Evidence/Discovery update.
   

 

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It's no secret to those of us who've been defending antitrust cases for a number of years that economic expert witnesses are a more important part of the defense team than ever before. Triers of fact often must evaluate complex economic analyses of the competitive effect of sophisticated business strategies. According to Judge Richard Posner of the Seventh Circuit -- an antitrust expert -- the task facing the average judge or juror is overwhelming:

Econometrics is such a difficult subject that it is unrealistic to expect the average judge or juror to be able to understand all the criticisms of an econometric study, no matter how skillful the econometrician is in explaining the study to a lay audience.

So what effect does economic complexity have on the likelihood that an antitrust case will be appealed? Is the judge's decision more likely not to be appealed -- or to be affirmed if it is appealed -- if the judge has at least basic training in antitrust economics? Until recently, there was no empirical evidence on these important questions.

Two antitrust scholars, Professor Joshua Wright and Professor Michael Baye, have filled that gap in an important new study, Is Antitrust Too Complicated for Generalist Judges? The Impact of Economic Complexity & Judicial Training on Appeals, which will appear in an upcoming issue of the Journal of Law & Economics. Professor Wright is an Assistant Professor of Law at George Mason University’s School of Law, and Professor Baye holds professorships in Business, and in Business Economics and Public Policy at Indiana University's Kelley School of Business. The professors' study has been discussed in Core Economics, the Antitrust and Competition Policy Blog, Legal Theory Blog, and most recently, Business Wire.  Professor Wright has been blogging the study for some time as it came together on his antitrust blog, Truth on the Market, here, here, and here.

The study is more than worth a complete read, but here's a summary. The professors collected every published decision involving the merits of an antitrust claim between 1996 and 2006 -- 714 decisions, including both district judges and administrative law judges. The researchers coded the cases by type of claim, as well as collecting data on the education and experience of the judges involved. Next, the professors searched for certain terms in the decisions in order to separate cases involving factually complex economic testimony from factually simpler cases. Finally, the study identified judges who had attended basic economic training classes at the George Mason University Law and Economics Center.

Professors Wright and Baye concluded that in cases not involving complex econometric data, the decisions of judges who had attended economic training programs were significantly less likely to be appealed, and less likely -- when they were appealed -- to be reversed. Interestingly, previous experience deciding antitrust cases was not an adequate substitute for economics training when it came to improving judicial decision-making. Responding to criticism that economics education programs for judges were biased towards politically conservative, free-market based economic theories, the researchers concluded that "trained" judges' decisions performed equally well whether the judge was a Democratic or Republican President's nominee.

Like most good research, the study suggests a number of follow-up questions – join me below the jump to see what some of those are.

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Can a government agency conspire to fix prices? When it comes to the California Travel and Tourism Commission, the Ninth Circuit says the answer is "no." Shames v. California Travel and Tourism Commission [pdf].

The CTTC consists of a dozen commissioners appointed by the Governor, and two dozen selected by the tourism industry. In 2006, the passenger rental car industry proposed a bill by which the industry agreed to pay a high assessment fee -- thereby considerably increasing the CTTC's budget -- in return for allowing the rental car industry to "unbundle" a tourism assessment fee and concession fee and itemize such fees separately from the base rental rate. According to plaintiffs' complaint, the CTTC colluded with the industry to pass these charges through to retail customers.

The district court held that "state action immunity" barred the complaint, and the Ninth Circuit affirmed.

In California Retail Liquor Dealers Association v. Midcal Aluminum, the Supreme Court held that private actors were immune from antitrust liability when two factors were satisfied: (1) the challenged restraint was clearly articulated and affirmatively expressed as state policy; and (2) the policy was "actively supervised" by the state.

On appeal in Shames, the plaintiffs argued that the first factor required that specific anticompetitive acts be expressly authorized by state legislation. The Ninth Circuit disagreed, holding that the first factor was satisfied where the anticompetitive actions were reasonably foreseeable in view of a broader statutory authorization, a standard easily satisfied by the 2006 CTTC legislation.

Citing both the Supreme Court's and its own precedent, the Court held that because there is little likelihood that a governmental agency would enter into a private price-fixing arrangement, there is no need for the state to actively supervise the agency's conduct for state action immunity to apply. The Court found that although two-thirds of the CTTC's commissioners are appointed by the tourism industry rather than by the government, the Commission was sufficiently similar to a government agency for the second factor to be inapplicable.

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On May 28, 2010, the Texas Supreme Court granted petitions for review in the following cases:

• Anglo-Dutch Petroleum Int’l v. Greenberg Peden P.C.—This case concerns the construction of a contingency fee agreement and the circumstances under which a court can conclude that an agreement is ambiguous.

• Hyde Park Baptist Church v. Turner—This case concerns the sufficiency of the evidence to support an award of future mental anguish damages and the qualifications of a clinical psychologist to render an opinion in such a case. In addition, the case will consider whether a jury may properly apportion more responsibility to a negligent tortfeasor than an intentional tortfeasor.

• American Home Assurance v. Maryland Cas. Co.—The case will consider the application of the notice and settlement-without-consent provisions of a liability policy covering an additional insured where the additional insured’s own liability insurers have paid a claim and seek subrogation.

• Molinet v. Kimbrell—This case will resolve the conflict between the absolute two-year statute of limitations applicable to healthcare claims and the 60-day window for asserting claims against persons designated as responsible third parties under the proportionate responsibility statute.

Oral argument has not been set for these cases.

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Last week, the Illinois Supreme Court allowed petitions for leave to appeal in eight new civil cases.  They are:

• Uldrych v. VHS of Illinois, Inc., Williams v. Board of Review, 2010 WL 743894 (1^st Dist., 2010), which involves the question of whether implied indemnity actions are subject to the four-year statute of repose governing actions which “aris[e] out of patient care”;
   
• Barber v. American Airlines, Inc., 2010 WL 546359 (1^st Dist., 2010), which involves the question of whether and when a defendant’s tender of the relief sought by a class representative prior to class certification moots the action;
   
• Lemmenes v. Orland Fire Protection District and Gaffney v. Board of Trustees of the Orland Fire Protection District, 2010 WL 1133028 (Lemmenes) and 397 Ill.App.3d 679 (Gaffney), 2010 (Lemmenes) and 2009 (Gaffney) decisions from the First District, consolidated by the Supreme Court, which involve the question of under what circumstances a firefighter injured while participating in a training exercise “reasonably believes” that he or she is responding to an emergency for purposes of being entitled to continued payment of health insurance premiums for the firefighter and his or her family;
   
• Howell v. Dunaway, 924 N.E.2d 1190 (5^th Dist. 2010), which involves the issue of whether various hospitals’ statutory liens for services under the Health Care Services Lien Act were properly reduced by a share of attorneys’ fees incurred by the injured parties pursuant to the common fund rule;
   
• LaSalle Bank National Association v. Cypress Creek, 398 Ill.App.3d 592 (3^rd Dist. 2010), which involves several questions relating to allocation of foreclosure proceeds where both a mortgagee and mechanics’ lien claimants are present;
   
• Thompson v. Gordon, 398 Ill.App.3d 538 (2^nd Dist. 2009), which involves the question of whether expert witness testimony created genuine issues regarding duty, breach and causation in a negligence action arising from a contract to design a replacement for a bridge deck; and
   
• Jablonski v. Ford Motor Company, 398 Ill.App.3d 222 (5^th Dist. 2010), which involves several issues respecting whether plaintiffs’ multiple theories of negligence and claim for punitive damages were properly submitted to the jury.

For further details about all eight cases, check Appellate Strategist's database of civil issues pending at the Illinois Supreme Court.

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In Martinez, the unanimous California Supreme Court affirmed the rulings of the lower courts by rejecting an attempt by agricultural workers to collect unpaid wages from food distributors who bought produce from that farm. In doing so, the court reviewed the history and jurisdiction of the Industrial Welfare Commission (IWC) and its work orders from 1916 to the present. The Court found that a civil action for unpaid wages authorized by Labor Code section 1194 was properly directed only to employers, and rejected attempts to expand the definition of "employ" as historically used by the IWC. For more Martinez case history, see the Employment-Compensation & Benefits update page.

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In March 2009, the California Supreme Court granted review in Hertz to address the issue of whether a worker’s inability to participate in vocational rehabilitation due to nonindustrial causes should be apportioned under Labor Code sections 4663 and 4664, as they were amended in 2004 by SB 899. The Court of Appeal had ruled that the statute required apportionment. (see H032438.) Briefing was complete, including several amicus briefs, and the matter was presumably waiting for oral argument. However, the Supreme Court has now dismissed this matter under Cal. Rules of Court, rule 8.528(b). As such, unless the court orders otherwise, the Court of Appeal opinion will remain unpublished

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During this morning's special session at the American Law Institute's Annual Meeting, Director Lance Liebman has announced that work is resuming on the Restatement (Third) of Torts: Economic Torts and Related Wrongs with Reporter Professor Ward Farnsworth. 

A few more details about the Institute's new project on insurance law have also become available.  Principles of Liability Insurance Law is expected to consist of three chapters: Principles of Contract Law in the Liability insurance Context, Principles of Liability Coverage, and Principles of Management of Insured Liabilities.

Finally, the Institute is in the earliest stages of "Principles of Government Ethics," which aspires to reflect the current state of this emerging area, as well as perhaps proposing a Model Statute.

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Last night, former Solicitor General Seth Waxman addressed the American Law Institute. He strongly endorsed the nomination of current Solicitor General Elena Kagan to the Supreme Court, stating that "It is and should be a foregone conclusion that she will be confirmed." Waxman told the members of having worked with Kagan in the weeks leading up to the reargument in Citizens United, the Court's decision striking down Federal limits on certain forms of corporate-financed electioneering, and being impressed with her brilliance.

Although many observers have suggested that Kagan's lack of judicial experience is a concern, Waxman noted that many of our greatest Supreme Court Justices came to the Court without appellate judging experience, including Robert Jackson, John Marshall Harlan and Earl Warren. Waxman argued that it was important for the Court to have members with the professional experience of learning from a broad cross-section of the country:

Elena Kagan's experience, although not judicial, will serve the country well.

Waxman also paid tribute to John Paul Stevens, the retiring Justice Kagan may replace. Describing Justice Stevens as a "consummate common law judge," Waxman said that arguing a case before him was both "a rare pleasure and a genuine terror." During his years on the Court, Waxman said that Justice Stevens has been an advocate of "judicial modesty," both substantive -- deference to the political branches, and reluctance to use the power to strike down statutes on constitutional grounds -- and procedural -- a cautious approach to choosing the questions the Court answers, and a strong preference for acting on the narrowest possible grounds.   According to former Solicitor General Waxman, judicial modesty "serves the structural balance that's essential to representative democracy."

On Monday, we reported on the remarks of Justice Stephen Breyer during the opening day of the ALI's meeting. Video of Justice Breyer's remarks is now available on the ALI's website, along with video from several additional speakers.

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The Florida Supreme Court recently decided, in a case of first impression, that a cause of action for third-party bad faith against an indemnity insurer cannot be maintained when the insurer’s actions were not a cause of the damages to the insured or when the insurer’s actions never resulted in exposure to liability in excess of the policy limits of the insured’s policies.  

In Perera v. United States Fidelity & Guaranty Co. (.pdf), the plaintiff’s husband, an employee of Estes Express Lines Corporation, was crushed to death by a piece of equipment, and his wife filed a wrongful death suit against Estes.  Estes had three insurance policies:  a $1 million commercial liability policy issued by Cigna, a $1 million excess worker’s compensation employer’s liability policy issued by USF&G, and a $25 million umbrella excess liability policy issued by Chubb.  USF&G denied coverage.  The parties entered into a settlement for $10 million, with Estes to pay $5 million, made up of $750,000 from Estes, $500,000 from Cigna, and $3.75 million from Chubb.  The remaining $5 million was to be sought by Estes or Perera in a lawsuit against USF&G. 

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In Simpson Strong-Tie Company, Inc., a manufacturer brought suit against an attorney who ran an advertisement regarding possible claims against the manufacturer's products and the trial court granted counsel's anti-SLAPP motion to strike. The California Supreme Court has now affirmed the judgment, holding that: 1) the plaintiff has the burden of proof in demonstrating the application of the commercial speech exception found in C.C.P. § 425.17(c) to anti-SLAPP motions and 2) the subject advertisement by counsel regarding potential claims against specified product manufacturers was not a statement by counsel “consisting of representations of fact about that person’s [i.e., counsel's] or a business competitor’s business operations, goods, or services.” As such, the advertisement did not fall within the commercial speech exception, and the manufacturer’s action was subject to an anti-SLAPP motion to strike. For more information regarding Simpson Strong-Tie Company, Inc., see the Civil Procedure/Evidence/Discovery update.

 

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Justice Stephen Breyer of the Supreme Court spoke this afternoon before a standing-room-only crowd at the Annual Meeting of the ALI. At Justice Breyer's suggestion, rather than making an address, he responded to questions from several ALI members.

ALI Director Lance Liebman asked how the Court's role as the final arbiter of so many crucial questions is compatible with democratic values. Justice Breyer responded that Alexander Hamilton's original answer from The Federalist had never been improved upon. Unless somebody enforces the Constitution, it becomes a dead letter. The power can't be given to the President, since that would be too much power. As a politically elected body, Congress can't be expected to pass judgment on their own statutes. Someone has to enforce the Constitution "when it's unpopular to do it," Justice Breyer said; anyone can do it when it's popular.

Justice Breyer was asked whether statutory and constitutional originalism, with its emphasis on text, history and precedent, was the more democratically legitimate approach for the Court to take to its work.  Justice Breyer disagreed with the view that there are no controls inherent in looking to purpose and consequence when it's appropriate which will prevent a judge from relying upon his or her subjective views.  In fact, if a judge is prepared to be honest, there are just as many checks and controls in an approach that incorporates purpose and consequence as in strict originalism.  The basic values and purposes stay the same, Justice Breyer said; it is the details as to how those values and purposes apply in a changing world that differ.

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In its weekly conference, see list of actions, the California Supreme Court granted review in:

• Jankey v. Lee, in which the Court of Appeal held that the Americans with Disabilities Act does not preempt Civil Code § 55, which entitles the prevailing defendant to attorney's fees upon defeating a claim for injunctive relief under the California Disabled Persons Act. See Attorney-Related update page.

• Diaz v. Carcamo, in which the Court of Appeal rejected an employer's argument that by conceding its liability under respondeat superior it was shielded from a claim that it was independently negligent in its hiring and retention of that same employee. See Torts & Products update page. In doing so, the Court of Appeal in Diaz distinguished two prior cases which held that an employer is protected from a claim of negligent entrustment upon such a concession. See Armenta v. Churchill (1954) 42 Cal.2d 448 and Jeld-Wen, Inc. v. Superior Court (2005) 131 Cal.App.4th 853.

 

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The California Supreme Court has scheduled oral argument in seven civil cases, five at the end of May and two in Los Angeles at the beginning of June. These hearings should address a wide variety of issues, including:

• Do employees have a private right of action against employers who take some of the tips? See the Lu case in the Employment-Compensation & Benefits update.
• Should CA recognize the "Stray Remarks" Rule in discrimination cases? See the Reid case in the Employment - Other update.
• Can an insured sue an insurer for fraudulently inducing settlement and seek to avoid the release without returning the money already paid? See the Village Northridge Homeowners Assn. case in the Insurance update.
• Does an administrative proceeding constitute a “suit” to trigger insurance coverage? See the Ameron Internat. Corp. case in the Insurance update.  
• Are non-signatory heirs bound by an arbitration agreement signed by the decedent? See the Ruiz case in the ADR update.
• Does the damages enhancement for actions brought by elderly plaintiffs apply to §17200 actions? See Clark case in the Damages update.
• Are evidentiary objections not expressly ruled on regarding an MSJ motion preserved for appeal? See the Reid case in the Appeals & Writs update.
• What is the preclusive effect of the investigatory findings of a federal agency? See the Murray case in the Civil Procedure/Evidence/Discovery update.

These cases represent about 10% of the civil cases currently under review by the Court.

Update: Oral argument in Ameron has been continued to the September 2010 calendar.

 

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This morning, President Obama announced that Solicitor General Elena Kagan is his nominee to succeed retiring Justice John Paul Stevens on the Supreme Court. The President had this to say about his nominee:

Elena is widely regarded as one of the nation’s foremost legal minds. She’s an acclaimed legal scholar with a rich understanding of constitutional law. She is a former White House aide with a lifelong commitment to public service and a firm grasp of the nexus and boundaries between our three branches of government.

The President praised Kagan’s “fair-mindedness and skill as a consensus-builder,” and noted that during her time as Solicitor General, “she has won accolades from observers across the ideological spectrum for her well-reasoned arguments and commanding presence.”

In her remarks, Kagan called the Supreme Court “an extraordinary institution in the work it does and in the work it can do for the American people by advancing the tenets of our Constitution, by upholding the rule of law, and by enabling all Americans, regardless of their background or their beliefs, to get a fair hearing and an equal chance at justice.”

She also spoke of her passion for the law:

Because law matters; because it keeps us safe; because it protects our most fundamental rights and freedoms; and because it is the foundation of our democracy.

The full text of President Obama’s and Solicitor General Kagan’s remarks are available at the White House website.

Reactions to the Kagan nomination are beginning to come in from the Senate, including three members of the Senate Judiciary Committee: Chairman Patrick Leahy, Senator Amy Klobuchar and Senator Orrin Hatch, as well as Senate Republican Leader Mitch McConnell.

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An appellate court in Florida granted certiorari and quashed a lower court’s order requiring the Plaintiff to submit to a compulsory medical examination in the presence of a videographer hired by the Defendant.

In Prince v. Mallari (.pdf), Defendant served a notice of compulsory medical examination to be performed by a defense-retained physician.  The notice stated in bold type: “If the plaintiff videotapes the examination, Defendant will also videotape the examination, at its expense.”  Over Plaintiff’s objection, the trial court ordered that if Plaintiff was going to videotape the examination, then the defense should also be allowed to have a videographer present.

Florida’s Fifth District Court of Appeal quashed the order, and in so doing reaffirmed Florida case law that although the defense can require a plaintiff to submit to a compulsory medical examination pursuant to Fla. R. Civ. P. 1.360, defense counsel does not have the right to be present at the examination.  The court reasoned that because a compulsory medical examination is an “adversarial” proceeding, a plaintiff must be afforded certain protections such as the right to privacy, the right to have counsel present, and the right to have the examination videotaped.  A plaintiff’s videotape of a compulsory medical examination would typically be protected from production under the work product doctrine unless the videotape was to be introduced as evidence at trial.

Defendant argued that because he could not obtain Plaintiff’s videotape of the examination through discovery due to the work product privilege, the only way to be on equal footing at the examination and to insure the accuracy of the videotape was to have his own videographer present.  The Fifth DCA, however, disagreed and held that just because a plaintiff has an examination videotaped, that does not permit defense counsel to simultaneously videotape the examination. Otherwise, defense counsel could do by proxy what they are not permitted to do in person.

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In Runyon, the unanimous California Supreme Court ruled that whistleblowers employed with California State University do not have to exhaust their judicial remedies (i.e., petition for a writ of mandate) to bring a suit for damages, so long as they first exhaust their administrative remedies. While this ruling is consistent with previous whistleblower rulings by the high court, it expressly overturns the Court of Appeal opinion in Ohton insofar as it is inconsistent. While not mentioned, this instruction necessarily applies equally to Ohton II , which recently reaffirmed the portion of the original opinion addressed in Runyon. For more Runyon case history, see the Employment-Other update page.

 

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CBS News is reporting that President Obama will announce his nominee to replace retiring Supreme Court Justice John Paul Stevens on Monday morning.

In the weeks since Justice Stevens announced his retirement, the Appellate Strategist has profiled each of the short list candidates:

Solicitor General Elena Kagan

Judge Diane Wood of the U.S. Circuit Court of Appeals for the Seventh Circuit

Judge Merrick Garland of the U.S. Circuit Court of Appeals for the D.C. Circuit

Judge Sidney Thomas of the U.S. Circuit Court of Appeals for the Ninth Circuit

Justice Carlos Moreno of the California Supreme Court

Secretary Janet Napolitano of the Department of Homeland Security

Judge Kim McLane Wardlaw of the U.S. Circuit Court of Appeals for the Ninth Circuit

Leah Ward Sears, former Chief Justice of the Georgia Supreme Court

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Our series of profiles of potential nominees to replace retiring Supreme Court Justice John Paul Stevens continues with Judge Merrick Garland of the U.S. Court of Appeals for the District of Columbia Circuit.

Judge Garland’s credentials are impeccable.  An honors graduate of Harvard University and Harvard Law School, he clerked for Judge Henry Friendly of the Second Circuit and U.S. Supreme Court Justice, William Brennan.  He served as Special Assistant to the Attorney General of the United States from 1979 to 1981.  He then entered private practice with Arnold & Porter in Washington D.C.  In 1989 he returned to the Justice Department as an Assistant U.S. Attorney for the District of Columbia.  After three years, he returned to Arnold & Porter but in 1993 he returned once more to public service when he was appointed Deputy Assistant Attorney General in charge of the Criminal Division.  In this role he supervised a number of high profile cases such as the Oklahoma City bombing and the Unabomber case. It has been noted that Judge Garland’s background is very similar to that of Chief Justice Roberts.

President Clinton appointed Judge Garland to the D.C. Circuit in 1995.  His appointment was held up for political reasons.  Republican senators, then in the majority, had no issues with Judge Garland’s qualifications or judicial philosophy, but argued that the D.C. Circuit did not need additional judges in light of its case load.  Judge Garland was finally confirmed in 1997.

Judge Garland is widely recognized as an expert on antitrust and, particularly, administrative law.  Interestingly, in the 1980s Garland was involved in an academic debate over Cass Sunstein, currently Administrator of the White House Office of Information and Regulatory Affairs, and a person frequently mentioned as a potential Supreme Court candidate.  The subject of the debate was the scope and purpose of judicial review of administrative agencies.  Generally, Sunstein favored a “hard look” approach to agency decisions, scrutinizing them to assure that they had considered the interests of all relevant stakeholders.  Garland, by contrast, urged that the focus of review should not be so much upon representation but upon ensuring fidelity to the language and purpose of Congress. Other writings urge that the states be free to make policy choices and that federal regulations, particularly economic ones, should not preempt them.

The case load of the D.C. Circuit is atypical, with much of its business coming from the regulatory agencies.  Join us below the jump for a review of some of Judge Garland’s notable decisions.

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In the days following Justice John Paul Stevens’ announcement in April that he would step down from the Supreme Court, the speculative “short list” of candidates to replace him steadily lengthened. But one name that was mentioned almost immediately was Judge Diane Wood of the U.S. Court of Appeals for the Seventh Circuit.

At age 59, Judge Wood presently sits on the Seventh Circuit Court of Appeals (nominated by President Clinton in 1995) and is a senior lecturer at the University of Chicago School of Law (where President Obama previously taught). She had been a top candidate for Justice Souter’s prior vacancy, and interviewed with President Obama before the position ultimately went to Judge (now Justice) Sotomayor.

Judge Wood graduated with high honors and Order of the Coif from the University of Texas School of Law in 1975. She clerked for Justice Harry Blackmun in 1976. If nominated and confirmed to the High Court, she would be the only seated Justice who did not attend Harvard or Yale law school.

Judge Wood is an expert on antitrust and trade law, and has authored several books and articles on those subjects. She has also written numerous articles on the topic of individual liberty, including a comprehensive review of Justice Blackmun’s constitutional jurisprudence on individual liberty and “the right to be let alone.”

• "Justice Blackmun and Individual Rights.” 97 Dickinson Law Review 421 (1993).
   
• “Sex Discrimination in Life and Law.” 1999 University of Chicago Legal Forum 1 (1999).
   
• “The Bedrock of Individual Rights in Times of Natural Disasters.” 51 Howard Law Journal 747 (2008).
   
• “Katrina and the Rule of Law in the Time of Crisis: Natural Disasters and the Rule of Law in the Time of Crisis: The Bedrock of Individual Rights in Times of Natural Disasters.” 51 Harvard Law Journal 747 (2008) (Wiley A. Branton/Howard Law Journal Symposium).
   
• “The Rule of Law in Times of Stress.” 70 University of Chicago Law Review 455 (2003).
   
• “Our 18th Century Constitution in the 21st Century World.” 80 New York University Law Review 1079 (2005).

Join us below the jump for some of Judge Wood's notable opinions:

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Our series of profiles of possible Supreme Court nominees to replace the retiring Justice John Paul Stevens continues with the Secretary of Homeland Security, Janet Napolitano.

After finishing at the top of her class at Santa Clara University -- earning a Truman Scholarship and graduating summa cum laude with Phi Beta Kappa honors -- Napolitano attended the University of Virginia Law School. After clerking for Ninth Circuit Judge Mary Schroeder, Napolitano began ten years in private practice in Phoenix. While in private practice, Napolitano was part of the team representing Anita Hill in connection with her testimony at Justice Clarence Thomas' confirmation hearings. She also participated in the briefing in Air Line Pilots Ass'n v. O'Neill, 499 US 65 (1991), which involved the standards applicable to determining whether a union has breached its duty of fair representation.

Napolitano's public career began in 1993, when President Clinton appointed her United States Attorney for Arizona. During her five years in that position, she prosecuted over 6,000 immigration cases and made cross-border crime a priority. Napolitano also led the investigation of Michael Fortier in connection with the Oklahoma City bombing.

She was elected state Attorney General in 1998. During her four years in that position, she focused on consumer protection. A defender of the death penalty, Napolitano argued Ring v. Arizona, 536 US 584 (2002), where the Supreme Court held that permitting judges to determine the facts necessary to qualify a defendant for the death penalty violated the Sixth Amendment.

In 2002, Napolitano was narrowly elected Governor. In her first month, Napolitano proposed a budget eliminating a $1 billion budget surplus without tax increases. During her two terms, Napolitano:

• Focused on immigration issues, ordering the National Guard to the Mexican border and significantly toughening sanctions on employers for hiring undocumented workers;
   
• Promoted a prescription drug plan and improved care in long-term living facilities for seniors;
   
• Championed education reform, including voluntary full-day kindergarten programs; and
   
• Reformed the state's Child Protective Services.

When Napolitano proposed giving a children's book to every first-grader in Arizona, rather than funding the program through the state budget, she spent three years raising nearly a half-million dollars in private funds to make the program possible.

In 2005, Time named Napolitano one of America's Five Best Governors.  A year later, Napolitano was named by the White House Project as one of the eight women most likely to become the first female President.  Napolitano served as Chair of the National Governors Association from 2006 to 2007.  She was confirmed as the first woman Secretary of Homeland Security in January 2009. Secretary Napolitano's experience as a prosecutor and government official, dealing with the practical impact of the law on everyday lives, places her among the President's potential Supreme Court nominees from outside the realms of the Federal appellate courts and academia.

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The California Supreme Court, in O'Neil v. Crane Co., No. S177401, is considering the liability of an equipment manufacturer under these circumstances:  The manufacturer sells a product pursuant to the buyer's specifications (say, a valve or pump) that is accompanied by an allegedly defective part (say, an asbestos-containing gasket) made by another, which is incorporated into a much larger and highly complex installation of machinery (say, the propulsion system for a Navy war vessel) designed by the buyer.  Over decades, the gasket is replaced many times during scheduled maintenance.  Eventually a replacement gasket, produced by an unknown third-party supplier, releases asbestos dust that causes injury.  May the original equipment manufacturer be found liable?
 
The first California Court of Appeal decision to address this question was issued by the First Appellate District (Division 1).  Taylor v. Elliott Turbomachinery Co., 171 Cal.App.4th 564 (2009). Taylor found the manufacturer was not liable because:

• it was not in the chain of distribution of the defective part, and received no profit or other economic benefit from the sale of the part;
• a manufacturer is not liable for an injury caused by a component part supplied by another unless the manufacturer's product caused or created the risk of harm, and
• a manufacturer is not liable where it simply produces a product pursuant to the specifications of a buyer who intends to incorporate it into a buyer-designed product unless the manufacturer's part itself caused the injury, which was not the case in Taylor.

The California Supreme Court declined  review.
 
Seven months after Taylor was decided, the Second District (Division 5) of the Court of Appeal handed down O'Neil v. Crane Co., 99 Cal.Rptr.3d 533 (2009).  O'Neil expressly rejected the holding and analysis of Taylor under analytically indistinguishable facts, concluding that the original product manufacturer may be liable on the theory that the pumps and valves were designed to be used in conjunction with asbestos-containing parts, and the foreseeable use of the product required maintenance which included periodic replacement and disturbance of parts containing asbestos.  If this foreseeable use caused injury, the court found, the manufacturer may be liable for that injury under established California law.  The Supreme Court granted the manufacturer's petition for review.
 
Shortly after O'Neil was decided, and before the Supreme Court granted review, another division (Division 3) of the Second District, in a published opinion, followed Taylor and ignored O'Neil in Merrill v. Leslie Controls, 101 Cal.Rptr.3d 614 (2009).  The Supreme Court issued a "grant and hold" in Merrill (that is, the court granted review and deferred briefing until O'Neil is decided).  Three months later, Division 2 of the Second District decided Hall v. Warren Pumps LLC, 2010 WL 528489 (unpublished) (2010), which also followed the reasoning and holding of Taylor.  A petition for review of Hall is pending, and undoubtedly the Supreme Court will issue a grant and hold in that matter as well.
 
Now yet another division of the Court of Appeal (Second District, Division 4) has expressed its views on the issue.  In a published opinion (Walton v. The William Powell Co., __ Cal.App.4th __, 2010 WL 1612209) the court explicitly adopted the analysis, conclusions, and holdings of Taylor while declining to address O'Neil or its reasoning in light of the Supreme Court's grant of review.  That the court decided to publish its views while breaking no ground not covered by Merrill suggests that is strongly wished its voice to be clearly heard while the Supreme Court is considering the question.  The Supreme Court will unquestionably issue a grant and hold in Walton; however, for those keeping score the number of justices voting for the Taylor view now stands at twelve, while there are three who support O'Neil.  The votes of the justices who will put the issue to rest is expected in the first half of 2011.

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An April 21 decision of the US. Supreme Court is must reading for attorneys who collect debts.  Making a legal mistake can subject the attorney and the firm to liability under the Fair Debt Collection Practices Act.

In Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA (.pdf), the law firm filed a complaint in state court.  The complaint contained a statement that the mortgage debt in question would be assumed valid unless the debtor disputed the debt in writing. When debtor’s attorney showed that the debt had been paid the original lawsuit was dropped.  Debtor then sued the firm and one of its attorneys for violating the FDCPA, alleging that the statement in the complaint that the debt must be disputed in writing was false.

The district court found that the complaint had, indeed, violated the Act but that the defendants were entitled to summary judgment on their statutory “bona fide error” defense under 15 U.S.C. 1692k(c). This provision allows a defendant to escape liability by showing that the violation was not intentional,  but resulted from a good faith error occurring despite the maintenance of reasonable procedures.

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We continue our profiles of short-listed potential nominees with Leah Ward Sears, former Chief Justice of the Georgia Supreme Court.

Justice Sears was born in 1955 in Heidelberg, Germany, where her father served as a colonel in the Army.  Her family later settled in Savannah, Georgia, and she attended high school there.  She received her bachelor’s degree from Cornell University, J.D. from Emory University School of Law, and, later, an LLM from the University of Virginia Law School in 1995.  After graduating from law school she joined the Atlanta law firm of Alston & Bird. 

Five years later Atlanta Mayor Andrew Young appointed Sears to Atlanta’s City Traffic Court, and three years after that, in 1988, she was elected to the Superior Court of Fulton County, Georgia – the first African-American woman to hold this position in Georgia.  In 1992 Georgia governor Zell Miller appointed her to Georgia’s Supreme Court.  She was the first woman and the youngest judge (36) to sit on that court.  She became Chief Justice in 2005 and retired from the court in 2009 when her term as Chief Justice ended.  She is now with the law firm of Schiff Hardin, LLP, in Atlanta. 

Justice Sears was among those considered last year to replace Justice David Souter.

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Appellate Strategist’s continuing series of profiles of “short list” candidates to replace the retiring Justice John Paul Stevens continues with Judge Sidney Thomas of the 9th Circuit Court of Appeals.  Judge Thomas is notable for his relatively conventional professional path, and his geographic and educational roots.  Where many of the current Justices arrived at the Court from the East Coast, Judge Thomas hails from Billings, Montana.  Many Justices had backgrounds in public service before assuming the bench, but Judge Thomas toiled as a private litigator representing a diverse array of commercial interests before the Montana Supreme Court and the federal appellate courts.  And, if he joins the Court, he’d be the only non-Ivy Leaguer among the justices.

Judge Thomas was born in 1953 in Bozeman, Montana, and graduated from Montana State in 1975.  He went directly to law school at the University of Montana, graduating in 1978.  In private practice, he represented mineral rights interests in cases ranging from inverse condemnation to the validity of oil and gas leases, as well as employers in wrongful discharge cases, newspapers in defamation cases, and a national broadcast network in a constitutional challenge to a Montana statute.

While in private practice, Judge Thomas supported the campaign of Senator Max Baucus, D- Mont., who later recommended him for the 9th Circuit.  President Clinton nominated Judge Thomas, who was confirmed by the Senate without controversy in January, 1996.

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In Pearson Dental Supplies, Inc. v. Sup. Ct., the court considered an arbitrator’s decision, pursuant to a mandatory arbitration agreement, that an employee’s discrimination claim was time barred. Since by failing to apply the tolling statute CCP § 1281.12, the arbitrator had committed “a clear error of law” which would deprive the employee of any review on the merits “of an unwaivable statutory employment claim,” the California Supreme Court ruled that the trial court could vacate the award. At the same time, the Court rejected an argument to strike down the arbitration agreement as a whole because it barred access to administrative remedies and set a one year limitations period. In concluding that it was “reasonably susceptible to a lawful interpretation,” the Court interpreted the restriction on administrative remedies as affecting only adjudicative agencies, such as the Labor Commissioner, while not affecting prosecutory agencies, such as the FEHA. For more case history, see the ADR update page.

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Since the days of Robert Bork, it has happened, sooner or later, to every Supreme Court nominee: the uncomfortable moment when a Senator quotes one of the nominee’s writings back to him or her, smiles across the Committee table, and says: “Explain that.”

If Solicitor General Elena Kagan is nominated to replace Justice John Paul Stevens on the Supreme Court next month, as observers like Tom Goldstein of SCOTUSBlog and Jeffrey Toobin of the New Yorker expect, here’s the quote she’ll be hearing:

When the Senate ceases to engage nominees in meaningful discussion of legal issues, the confirmation process takes on an air of vacuity and farce, and the Senate becomes incapable of either properly evaluating nominees or appropriately educating the public.

Kagan wrote that in a 1995 book review for the University of Chicago Law Review. During her 2009 confirmation hearings, she addressed the issue this way: “I am also less convinced than I was in 1995 that substantive discussions of legal issues and views, in the context of nomination hearings, provide the great public benefits I suggested. Yet that leaves the question just what these hearings should be about – what matters Senators should explore with the nominee and how the nominee should be evaluated. I confess to finding these questions very difficult.”

Kagan’s professional background is described in detail in the Background Questionnaire she completed for the Judiciary Committee in 2009. A native New Yorker, she received her undergraduate degree from Princeton and a Masters from Oxford. After graduating from Harvard Law School in 1986, she clerked for Judge Abner Mikva on the D.C. Circuit, and then for Thurgood Marshall at the U.S. Supreme Court. Between 1989 and 1991, Kagan was a junior associate at Williams & Connolly in Washington, handling a mix of commercial, First Amendment and white-collar criminal litigation.

Since that time, Kagan’s career has shuttled between academia and public service. She joined the faculty at the University of Chicago Law School in 1991, but left temporarily to serve at the request of now-Vice President Biden as Special Counsel to the Senate Judiciary Committee during the confirmation hearings for Justice Ginsburg in 1993. 

In 1995, she interrupted her academic career again to serve as Associate Counsel to the President, and later as Deputy Assistant to the President for Domestic Policy. After leaving the White House in 1999, she was a Visiting Professor at Harvard Law School, becoming a resident Professor in 2001 and Dean of the Law School in 2003. Kagan was nominated and confirmed as the first woman to serve as Solicitor General in 2009.

General Kagan’s Tenure as Solicitor General. Since Justice Stevens announced his retirement, there’s been considerable public discussion of Kagan as a potential nominee. Columnist Glenn Greenwald has expressed concerns about her substantive views, former Solicitor General Walter Dellinger and Tom Goldstein of SCOTUSBlog have defended her, and Greenwald has responded.

Although these columns have been largely concerned with policy, Kagan’s performance as Solicitor General has come in for some criticism as well. Writers in both Salon and the New York Times have been critical of Kagan’s tenure, and other columnists have quoted from, and linked to, those articles. However, these criticisms do not stand up to close analysis.

Join us below to jump to see why.

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In conference Wednesday (see list of actions), the Court granted review in Save the Plastic Bag Coalition v. City of Manhattan Beach, in which the Court of Appeal upheld vacating a city ordinance banning the use of plastic bags because an environmental impact report was not prepared. See the Environmental update page. In addition, the Court granted review in Harris v. City of Santa Monica, in which the Court of Appeal reversed a plaintiff’s judgment for discrimination because the trial court had failed to give an instruction on mixed motives for her discharge. See Employment – Other update page. In a previous action outside of the weekly conference, the Court asked for additional briefing in Reid v. Google addressing exactly how a party can preserve evidentiary objections so that they are “made at the hearing.” See the Civil Procedure/Evidence/Discovery update page.
 

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California’s Unfair Competition Act has generated an enormous amount of litigation, and has long been a target of tort reform groups. Those reform efforts met with an important success in 2004, when the voters approved Proposition 64, finding that the statute had been “misused by some private attorneys” to file “frivolous lawsuits as a means of generating attorney’s fees.” Proposition 64 significantly tightened standing requirements for private enforcement suits based on the UCL.

Earlier this week, the Fourth District of the California Court of Appeal filed an important decision strengthening the arsenal of weapons available to defense counsel defending UCL suits.

Durell v. Sharp Healthcare [pdf] was a putative class action alleging violations of the UCL, the Consumer Legal Remedies Act, and various common law claims. Plaintiff had been a patient in the defendant’s emergency room several times, and he alleged that the defendant had engaged in deceptive and unfair practices by billing uninsured patients such as plaintiff its full standard rates, while accepting sharply reduced payments for Medicare and privately insured patients.

The UCL prohibits “unlawful, unfair or fraudulent” business acts. In 2009, the state Supreme Court held in In re Tobacco II Cases that Prop 64 meant that a plaintiff must show actual reliance on any supposed misrepresentation to plead a “fraudulent” act. The first question for the Court in Durell was whether Tobacco II applied equally to the “unlawful” prong of the statute.

The court unequivocally held that it did:

A consumer’s burden of pleading causation in a UCL action should hinge on the nature of the alleged wrongdoing rather than the specific prong of the UCL the consumer invokes.

But the court went even further. In Cel-Tech Communications, the state Supreme Court held that a competitor’s claim of an “unfair” act had to be tethered to an incipient violation of an antitrust law, or a comparable statute aimed at protecting competition. Since then, the districts of the Court of Appeal have been divided as to whether Cel-Tech applied to consumer actions. Durell came down firmly on the side of applying the restrictive Cel-Tech test to plaintiff’s action, a test he came nowhere near meeting. Plaintiff’s failure to plead causation was similarly fatal to his claim under the Consumer Legal Remedies Act.

Durell is an important reaffirmation of the voters’ will in Prop 64, and the message for the defense bar is clear: when defending a UCL case based on a purported misrepresentation, always begin by carefully studying plaintiff’s allegations of reliance.

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Demonstrating the potential significance and broad implications of the California Supreme Court's deliberations in Loeffler v. Target Corporation, so far a total of nine amicus briefs have been filed on behalf of sixteen entities addressing the issue of whether a taxpayer can directly bring suit against a retailer who allegedly charged a sales tax on transactions that were not taxable. The concerned entities unwilling to wait on the sidelines range from consumer groups and taxpayer advocates to statewide and national retailers, as well as the California Attorney General and the California State Board of Equalization. Some of these had also filed briefs with the Court of Appeal, which barred the taxpayer claim.

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“What do I do with this case?” asked Justice Breyer in the final minutes of oral argument Monday morning in Christian Legal Society v. Martinez [pdf].

Justice Breyer’s question underscored the apparent confusion regarding what exactly was being challenged in the Christian Legal Society’s case against Hastings College of the Law. Despite the acknowledged importance of the constitutional question – whether and to what extent a public school may require officially recognized student groups to adhere to a non-discrimination policy even if that policy conflicts with a religious organization’s religious beliefs – this confusion may actually discourage the Court from answering the issue directly, in favor of remanding to the lower courts in order to develop a clear factual record.

When argument commenced, the Court almost immediately sought to identify just what it was being asked to decide. 

• Was it the constitutionality of the “written policy” (the school’s  non-discrimination policy) or
   
• The “all-comers policy” (the condition that a registered student organization’s bylaws must provide that its membership is open to all students”)?
   
• Justice Scalia postulated that “the all-comers policy [is] broader than the non-discrimination policy, so that if you comply with that, you automatically comply with everything in the non-discrimination clause.” CLS counsel, Stanford Law Professor Michael McConnell, argued that both are unconstitutional.

Moreover, were the policies being enforced evenly by Hastings on all student groups, or just against CLS?  Justice Kennedy noted the parties did not agree on what case was before the Court. Counsel for Hastings, Gregory Garre, agreed that if the factual record showed the policy was not evenly applied to all groups, the policy would be unconstitutional. Kennedy appeared to concur: “It’s a much different case if Hastings treats the CLS differently than it treats the Democratic and Republican Club.” But given the newly emergent disagreement regarding the facts – i.e. whether the law school’s policies and requirements for registered student organizations were in fact being applied even-handedly – Justice Kennedy stated his concern that “it’s frustrating for us not to know what kind of case we have in front of us.”

Justice Breyer expressed perhaps the strongest frustration, saying: “I have an absolute void in this record, which in turn I think would be important to fill.” He continued: “where I feel I need more facts and I don’t have them . . . what should I do?” Even Mr. Garre conceded the presence of a new dispute: “This case was litigated based on stipulations to avoid precisely these factual issues that we are now talking about for this first time before this Court.” 

Nevertheless, the Court pressed on, attempting to reach the core constitutional question. And a large part of questioning was directed at what could be labeled the “take over problem”: the CLS’s objection to “being run by non-Christians” if it were forced to allow enrollment of members and officers who do not share the group’s core beliefs.  

At one point, Justice Alito asked Hastings’ counsel: “suppose at a particular campus there is a great deal of anti-Muslim animus. And there is a small Muslim group; it has ten students. If the group is required to accept anybody who applies for membership, and 50 students who hate Muslims show up and they want to take over that group, you say: First Amendment allows that?” Mr. Garre parried, saying “this example has never happened at Hastings in 20 years.” 

Garre insisted that “[g]roups can take measures to prevent [such a ‘takeover’].” But Chief Justice Roberts and Justice Alito pressed Garre. Justice Alito demanded to know what recourse an organization would have if such a “hostile takeover” were to actually take place. Garre suggested that “the members would rejoin and form another group,” to which Justice Alito quipped: “if hostile members take over, former members of CLS can form CLS2?” drawing laughter from the gallery.

In contrast, Justice Ginsburg had earlier pointed out that “all the hypotheticals about sabotage, takeover, they haven’t happened.” Justice Kennedy expressed a similar pragmatic view: “Why doesn’t this just all work out? If the Christian Legal Society has these beliefs, I am not so sure why people that don’t agree with them want to belong to them. What . . . doesn’t this all just work out?” This viewpoint would put these two Justices at odds with Chief Justice Roberts and Justice Alito, who seemed unwilling to resolve the issue by resorting to the conclusion that the feared “take over situation” is unrealistic.

Regarding what type of membership discrimination would be permissible, each advocate tried to draw a distinction. Faced with questions about whether a student organization could exclude members because of their race or gender, counsel for CLS distinguished between discrimination based on a potential member’s “status” and discrimination based on a potential member’s “belief” in the organization’s tenets. Mr. McConnell argued that an organization may permissibly condition membership on the latter, but not on the former.

And Hastings’ counsel conceded that an organization may permissibly create “merit” requirements for membership and officer positions within the organization, such as “pass[ing] a test on the Bible” if such a test “were truly an objective knowledge test.” To which the Chief Justice countered: “I assume there are groups that think subscribing to their beliefs is evidence of merit, particularly religious groups. So how can you have a test that allows distinctions based on merit but not beliefs?” At one point the law school seemingly pled the position that by adopting its non-discrimination policies it was merely taking a position of ultimate neutrality: “Hastings isn’t in the business of second-guessing the beliefs of individual groups.” 

Reading the proverbial tea leaves is always an exercise in speculation. Justices Scalia and Alito, along with the Chief Justice, appeared more sympathetic to CLS’ position, while Justices Ginsburg, Sotomayor, and Kennedy appeared to favor the arguments of Hastings. Both Breyer and Kennedy expressed dissatisfaction with the state of the record and confusion about just what issue was before the Court.  This case may turn out to be a tempest in a teapot.

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This afternoon, the Illinois Supreme Court published its May docket for oral arguments, and the Court’s docket includes nine civil cases. The cases, with the issue or issues presented in each, are:

May 13:

• Hurlbert v. Charles, No. 109041: “Under the Supreme Court's decision in People v. Moore, 138 Ill.2d 162 (1990), does a finding of probable cause in a drivers' license summary suspension hearing arising from a DUI arrest collaterally estop the driver from relitigating the issue in a subsequent civil action?

May 18:

• In re Estate of Mary Ann Wilson, No. 108487: “Does 735 ILCS 5/2-1001(a)(3) of the Code of Civil Procedure permit a judge to make an initial determination of whether a petition to substitute judges for cause makes a threshold showing of prejudice before transferring the matter to another judge for decision?
   
• Vancura v. Peter Katris, et al., No. 108652: “(1) Was notary’s employer liable under the Notary Public Act, 5 ILCS 312/7-102, where notary authenticated forged signature on mortgage assignment, based on a theory that employer either expressly or impliedly consented to notary’s alleged misconduct? (2) Is the Notary Public Act the exclusive statement of the standard of care in an action for negligence against a notary? (3) Did notary’s employer breach any applicable duty to train and/or supervise?”
   
• State Building Venture v. O’Donnell, No. 108673: “(1) Was the action of a tenant in a state-owned office building against a state department on its lease barred by either sovereign immunity or collateral estoppel? (2) If not, did the enabling statute 20 ILCS 405/405-315(a)(s), unambiguously permit leases with automatic renewal periods?”
   
• Ready v. United/Goedecke Services, Inc., No. 108910: “Where a defendant has denied liability, may defendant introduce evidence regarding the conduct of other defendants who have settled in good faith pre-trial for the purpose of showing that one or more of the settling defendants were the sole proximate cause of plaintiff’s injuries?”

May 19:

• Millennium Park Joint Venture, LLC v. Houlihan, No. 108923: “Are the remedies set forth in the Property Tax Code, 35 ILCS 200/23-5, 23-10, 23-15, a taxpayer’s sole avenue for arguing that an assessed property tax is ‘unauthorized by law’?”
   
• Hubble v. Bi-State Development Agency, No. 109137: “Is the defendant, an agency formed pursuant to an interstate compact, a “local public entity” within the meaning of the Local Governmental and Governmental Employees Tort Immunity Act, 745 ILCS 10/8-101, and therefore subject to the one-year statute of limitations set forth in the Act.”
   
• Irwin v. Department of Revenue, No. 109300: “(1) Did corporate aircraft hangared in different state have substantial nexus to Illinois sufficient to permit Illinois to impose use tax on purchase price of plane? (2) If so, was Illinois statute's system of credits for tax paid other states sufficient to satisfy Interstate Commerce clause without further apportionment?”
   
• Wright Development Group, LLC v. Walsh, No. 109463: “(1) Where the Citizens’ Participation Act gives a defendant successfully moving to dismiss an action a right to an award of attorneys’ fees and costs incurred in connection with the motion (735 ILCS 110/25), was defendant’s appeal from denial of his motion to dismiss mooted by the subsequent dismissal of the action on other grounds? (2) If not, was defendant entitled to dismissal of the defamation action pursuant to the Act?”

Decisions in these cases will be filed later in the year.

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In an 8-1 decision (.pdf), the United States Supreme Court struck down recently enacted 18 U.S.C. 48  which forbids the distribution of images depicting cruelty to animals. 

In United States v. Stevens, the defendant had been convicted of distributing videotapes of pit bulls attacking other animals.  Chief Justice Roberts, writing for the majority, held that the statute went too far.  Its language, which among other things, bans depictions of the unlawful killing or wounding of animals, could be used to prosecute persons distributing depictions of activities such as hunting that were lawful and even encouraged where they occurred but illegal in places (like the District of Columbia) that did not permit hunting.  Although the statute contained an exception for materials with “serious” educational or religious value, the exception did not adequately save the statute as a whole from overbreadth.

Justice Alito was the lone dissenter.  He accepted the government’s argument that the statute reached only depictions of sadistic activity.

It is encouraging that, despite ideological difference, the Supreme Court can achieve consensus on a constitutional issue.  Hopefully, Congress will learn the lessons of the Stevens opinion and craft an animal-cruelty law that is more precisely focused.

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As part of Appellate Strategist's ongoing evaluation of the “short list” of potential nominees to replace retiring Justice Stevens, we turn now to one of the nominees who was also on the short list to replace Justice Souter – Judge Kim McLane Wardlaw of the 9th Circuit Court of Appeals.

Judge Wardlaw is a California native, born in 1954 in San Francisco. She earned her undergraduate and law degrees at UCLA, graduating from law school in 1979. She clerked for the Hon. William P. Gray, U.S. District Court, Central District of California for two years, then worked in private practice as a litigator in Los Angeles from 1980-1995. Wardlaw worked on the Clinton-Gore Presidential Transition Team with the U.S. Department of Justice in 1992-1993, and later on the Mayoral Transition Committee for Los Angeles Mayor-elect Richard Riordan in 1993.

Wardlaw was nominated to the U.S. District Court, Central District of California, by President Clinton in 1995, and to the U.S. Court of Appeals for the Ninth Circuit in 1998. Both her confirmations were quick and unanimous. Such a history of bipartisan support might bode well for a future nomination.

Judge Wardlaw is often described as a moderate liberal or centrist, who would give the court greater diversity as the third female justice and the second Latina. She would also be the only non-Ivy League justice and offer extensive experience as a private litigator.

Join us below the jump for a review of notable Ninth Circuit opinions authored by Judge Wardlaw:

Continue Reading...

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Appellate Strategist has posted several times in the last week about names being discussed as possible nominees to replace retiring Justice John Paul Stevens. But a list of names, however important, says little about the nominees. We therefore begin our series of short profiles of those whose names top the list. We begin with Carlos Moreno, an Associate Justice of the California Supreme Court.

The recipient of a B.A. in political science from Yale University (1970) and a 1975 J.D. from Stanford Law School, Carlos Moreno served in the Los Angeles City Attorney's Office, prosecuting criminal and civil consumer protection cases. In 1979, he joined a private firm, representing clients in general commercial litigation. He has a solid background as a trial judge, having served on the Los Angeles Superior Court and the U.S. District Court of Appeal, Central District of California. He was appointed to the California Supreme Court in 2001.

Moreno’s standing as a legal scholar is beyond dispute. He has a well-deserved reputation for integrity that cuts across ideological boundaries, and a good judicial temperament, though he has been known to politely but firmly challenge attorneys who make bald statements about legal propositions, often asking “what’s your authority for that, counsel?” (That is not a criticism, by the way.) He construes statutes as they are written, even if he disagrees with the underlying policy, subscribing to the (sometimes novel) view that that is a jurist’s job. His substantive specialties include criminal cases and arbitration.

Join us below the jump for a sampling of recent opinions he has authored.

Continue Reading...

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Justice John Paul Stevens has been tagged by many as a “liberal.” Appellate Strategist does not propose to debate that general proposition here. Rather, it’s time to begin assessing what effect his absence might have on the growing body of Supreme Court jurisprudence that has been cutting back, a little at a time, on the blockbuster punitive damages awards that so commonly make the headlines. Or at least used to make the headlines.

Here are a few thought-provoking tidbits concerning his role in the development of this important body of law: 

• Justice Stevens pioneered the recent punitive damages jurisprudence, authoring two of the Court’s first forays into the constitutionality of the award amounts. The first was the “granddaddy” of them all, BMW, which blazed the trail. (BMW of No. Amer. v. Gore (1996) 517 U.S. 559.)  After that came Cooper, which created an unprecedented de novo standard of review of punitive awards for constitutional excessiveness. Appellate courts were no longer constrained by the trial judges’ decision re the propriety/excessiveness of the amount. Cooper gave courts of appeal a free hand to bring the excessive “outlier” verdicts into line. (Cooper Industries, Inc. v. Leatherman Tool Group, Inc. (2001) 532 U.S. 424.)
   
• He joined in the Campbell majority opinion, the behemoth that expanded the defendant’s constitutional rights beyond a mere review for excessiveness of the amount. (State Farm Mut. Auto. Ins. Co. v. Campbell (2003) 538 U.S. 408.)
   
• He dissented in Williams. He still believed that due process imposes both substantive and procedural constraints on State power to impose punitive damages, but Williams presented a different issue. The majority held the State may not punish the defendant with punitive damages for harming other victims who were not plaintiffs and not before the jury. (Philip Morris USA v. Williams (2007) 549 U.S. 346.) Justice Stevens saw “no reason why an interest in punishing a wrongdoer ‛for harming persons who are not before the court,’ should not be taken into consideration when assessing the appropriate sanction for reprehensible conduct.” (Citation omitted.)
   
• We discount the Court’s most recent decision, Exxon Shipping Co. v. Baker (2008) 128 S.Ct. 2605, which presented unique issues of punitive damages under federal maritime law, and anyway, there are so many separate opinions and joinders, it would take a computer program to keep the justices’ various positions straight.

These cases have revolutionized the law of punitive damages, helped level the once-tilted playing field, and afforded them relief – in the form of reduced awards – awards that a few years ago were often rubberstamped on appeal as within the jury’s discretion. Countless billions – literally – “billions” with a “b” – have been saved thanks to these legal developments. He clearly made an important contribution.

Now the burning question is: where will the successor stand? In a series of future posts, Appellate Strategist will try to explore that question, and perhaps even offer some answers.

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As Appellate Strategist reported a week ago, when Justice John Paul Stevens announced his retirement, most Supreme Court observers believed that the "short list" contained three names: Solicitor General Elena Kagan, Judge Diane Wood and Judge Merrick Garland. But even as the White House is suggesting that a nominee will be named in early May, it appears that the "short list" is growing longer.

CNN reports that Judge Sidney Thomas of the Ninth Circuit is under consideration as a possible nominee.  Judge Thomas was in private practice in his native Montana before he was nominated to the Ninth Circuit by President Clinton. He has served on the Ninth Circuit since 1996.

According to ABC News, Leah Ward Sears, former Chief Justice of the Georgia Supreme Court,  is on the President's short list as well. Justice Sears was appointed to the Georgia Supreme Court in 1992, and was sworn in as Chief Justice in 2005.  She retired from the court in 2009, and is now in private practice.

The Boston Globe is reporting that Professor Martha Minow, the Dean of Harvard Law School, is another possible nominee. Professor Minow has written extensively on human rights law.  She has taught at Harvard Law School since 1981.

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Many states have enacted statutes automatically invalidating, under one set of circumstances or another, contracts which seem to require mandatory arbitration of disputes. In a 5-0 decision today (with two justices not participating), the Illinois Supreme Court cast such statutes in doubt, holding that two clauses of the Illinois Nursing Home Care Act were preempted by the Federal Arbitration Act. Carter v. SSC Odin Operating Company.

Plaintiff's decedent and plaintiff herself, as special administrator, executed contracts providing that disputes over decedent's care while she lived in the defendant's nursing home would be decided in arbitration. After decedent's death, plaintiff sued for wrongful death and violations of the Nursing Home Care Act. The defendant moved to compel arbitration, relying upon section 2 of the Federal Arbitration Act.

At first glance, the Illinois Nursing Home Care Act would seem to have required the Circuit Court to deny defendant's motion. The Act invalidates any waiver by a resident or his or her legal representative of the right to sue under the Act, and also invalidates any waiver of the right to trial by jury for an action under the Act. But not so fast: according to the Federal FAA, mandatory arbitration terms are valid "save upon such grounds as exist at law or in equity for the revocation of any contract."

So was the Nursing Home Care Act's language grounds equally applicable to revocation of any contract? No, according to the Illinois Supreme Court.

The sort of defense Congress had in mind, the Court wrote, was fraud or lack of consideration -- general defenses that had nothing specifically to do with arbitration. But the FAA strips the states of any power to invalidate arbitration clauses per se. According to the unanimous Court, that national policy is to be applied in broad terms: any statute requiring that a dispute be resolved in court is invalid if the underlying contract had a mandatory arbitration clause.

The lesson for defense counsel is clear. If a statute forbids waiver of a cause of action, or requires a jury trial, and the contract at issue contains an arbitration clause, the underlying statute is probably preempted. Under the Court's reasoning, a statute apparently aimed at protecting a certain class of plaintiffs -- whether nursing home residents, or seniors, or consumers -- from mandatory arbitration clauses will almost never prevail against the FAA. 

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On April 9, the Texas Supreme Court granted petitions for review in the following cases:

• Offshore Specialty Fabricators v. Wellington Underwriting Associates. The case addresses whether an all-risk insurance policy covers weather stand-by charges incurred by the insured.

• XTO Energy Inc. v. Smith Production Inc. The case will determine whether joint operating agreements for oil and gas drilling operations are construed according to their language only or whether industry custom should also be considered.  A possibly fundamental case in the oil and gas field.  

• Haygood v. de Escabedo. This case turns on whether the statute limiting recovery of medical damages to those “actually incurred” permits recovery of amounts charged but later written off by the provider.  The courts of appeals are divided on the issue, which arises in many personal injury cases.

• Reid Road Municipal Utility Dist. No. 2 v. Speedy Stop Food Stores Inc. The case will determine whether the “property owner rule” which permits property owners who are not qualified as experts to testify as to the market value of the property applies to corporate property owners.

• Andrade v. NAACP of Austin.  The underlying case is a challenge to the Secretary of State’s certification of certain paperless voting machines.  The case addresses whether voters have standing to challenge the Secretary’s certification and whether the Secretary enjoys sovereign immunity from such a suit.

• Marsh USA Inc. v. Cook. The case turns on the enforceability of non-solicitation agreements upon a former employee and whether the agreement was supported by independent consideration.

Oral argument has not yet been set for any of these cases.

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Today, the Illinois Supreme Court affirmed a punitive damage award that had been drastically reduced by the trial judge, and cut still more by the intermediate appellate court, to slightly over $80,000, or 1:1.  The State high court affirmed the punitives as reduced to 1:1.  This may sound like just another case applying the Campbell federal due process guidelines regarding excessive awards.  It isn’t. 

In Slovinski v. Elliott (pdf), plaintiff sued his former employer for defamation.  The jury awarded him $81,600 in emotional distress damages and $2 million in punitives.  The trial judge cut that number to $1 million; the appellate court chopped it down still more,  to 1:1.  The Illinois Supreme Court, with one dissenter, affirmed the reduction to $81,600.  In the process it provided some insight into Illinois procedure for “remitting” –  that’s appellate-speak for cutting –  punitive awards, and the propriety of the amount under Illinois state law.

Procedural challenges. Plaintiff argued that the reductions by the trial and appellate courts were procedurally improper for a number of reasons, e.g., that “specific findings” were required in order to cut, and the failure to make findings meant plaintiff should get his $2 million reinstated.  The answer to that one was “no.”  Courts are simply required to explain why a reduction is necessary, and why they think the trial judge or jury got it wrong, not to jump through meaningless hoops.  A refreshing, common sense approach.

Substantive challenge.   The Supreme Court began by noting that a punitive damage award never compensates the plaintiff, who has been made whole by the compensatory award.  Thus, the focus should be on whether the defendant’s conduct justifies the award.  After that, the court had no trouble concluding that $81,600 in punitives was ample punishment, noting:

• Defendant’s intent.  The jury heard no evidence that defendant had an intentional, premeditated scheme to harm the plaintiff.  At most, defendant consciously disregarded its employee’s rights. “This places defendant’s conduct on the low end of the scale for punitive damages, far below those cases involving a defendant’s deliberate attempt to harm another person.”

• No recidivism.  Defendant did not repeat the defamatory statements, but made them only once, and only those present at the meeting heard them.

• Minimal harm to plaintiff.  The jury’s compensatory damages verdict showed “limited harm to plaintiff.”  There was no damage award for loss of reputation or lost wages.  And on the emotional distress award, there was no evidence of any physical harm to plaintiff, no visits to a doctor or therapist, no evidence that plaintiff missed work, no evidence of any alteration in his daily work activities.

This is Illinois State law we’re talking about.  All of this analysis sounds reminiscent of the federal guidepost considerations used to determine when a punitive award is excessive under the due process clause.  But this court was not using a Campbell-BMW analysis.  Slovenski decided this as a matter of Illinois State law.  

This reduced verdict was affirmed because under Illinois law, “an award of punitive damages must be remitted to the extent that there is no material evidence to support it.”  Even in cases of defamation per se, the  malicious conduct necessary to support an award of punitive damages may not be presumed, but must be proved by competent evidence.”  (Emphasis added.)  The trial court thus abused its discretion is remitting the award to only $1 million because there is no basis in the record to support such an award. 

Trial judges take note: whether you cut or not, abuse of discretion won’t necessarily be a shield.

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In conference today (see list of actions), the Court granted review in Brown v. Mortensen, in which the Court of Appeal found that the Fair Credit Reporting Act preempted the restrictions imposed by the Confidentiality of Medical Information Act.  See B & P 17200/Class Actions/Commercial update page.  In addition, the Court also requested supplemental briefing in Murray v. Alaska Airlines, Inc. regarding the application, if any, its decision in McDonald v. Antelope Valley Community College Dist. (2008) 45 Cal.4th 88. See Civil Procedure/Evidence/Discovery update page.

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CAPPING AT THREE.  AB2740, a new version of an old bill pending in the California State Legislature, would cap the amount of punitive damages available in California to a flat three times the jury’s award of compensatory damages. AB2740 The previous version died in Committee.  The new iteration (tacked onto a National Guard bill, of all things) was alive and well as of late March, 2010.
 

• Should the measure pass, California would fall in step with many other States that impose some type of ceiling on punitive damages, whether flat-out monetary caps, caps keyed to a multiple of compensatory damages, caps based on defendant’s wealth or the nature of the act, the type of action (e.g., medical malpractice) or some combination, including: Alaska, Arkansas, Alabama, Colorado, Florida, Georgia, Idaho, Indiana, Kansas, Mississippi, Montana, North Carolina, North Dakota, New Jersey, Nevada, Oklahoma, and Texas.  That isn’t a comprehensive list, nor can AppellateStrategist list all the wrinkles and permutations in this post.  But the point is clear.  There’s a growing movement afoot to impose a bright line on the imposition of punitives, thereby streamlining or eliminating the current multipart constitutionality analysis mandated by State Farm Mut. Auto. Ins. Co. v. Campbell (2003) 538 U.S. 408, and BMW of North America, Inc. v. Gore (1996) 517 U.S. 559.

PRODUCT WARNING CASES.  AB2740 would also bar punitive damages in products cases if the warning accompanying the product was “either approved by, or in material compliance with,” a statute, or the standards, rules, regulations or requirements of the federal or state agency responsible for “regulating, evaluating, or approving the product.”  Should the bill pass, it would apply to every products-warning “case pending on or after the date of enactment regardless of when the case was filed.”

The sole exception is that the bar would not apply if plaintiff proves by clear and convincing evidence that defendant intentionally withheld or intentionally misrepresented information it was required to submit to the agency at any time, and the withholding or misrepresentation of that information was causally related to the injury or harm alleged.

AppellateStrategist will monitor the bill, and provide regular updates.  Stay tuned.

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Add yet another appellate opinion to the growing list of California courts that have cut punitive damage awards on constitutional excessiveness grounds. In this one, Amerigraphics, the jury awarded $3 million in punitive damages in an insurance bad faith case.  The trial court cut that number  to $1.7 million, but according to the California Court of Appeal (Second District, Division 2), that was not enough.  The constitutionally-permissible maximum was $500,000. 

At the risk of looking a gift horse in the mouth, the case is a mixed bag for insurer defendants.

One of the principal questions in deciding excessiveness is how bad – “reprehensible” -  the defendant’s conduct was.  That is determined under a scale of relative reprehensibility.  The theory is simple: relatively speaking, some acts and harms are worse, and therefore more deserving of punishment, than others.  For example:

1. Defendants who are repeat offenders – who have committed the act before – need a bigger punishment to discourage them from repetition, to get the message across.

Amerigraphics rejected the notion that an insurer which commits multiple acts in the handling of a single claim for benefits can be viewed as a “repeat offender.”  Though the insurer’s

“conduct could  be characterized as more than a single isolated incident, as the evidence showed several discrete acts of misconduct involving Amerigraphics’s claim for coverage under various policy provisions, the conduct at issue ultimately involved only one insured and one claim. There was no evidence presented that [the insurer] acted similarly toward other insureds in similar circumstances.”   (Emphasis added.)

More authority for the “one claim, one punishment rule.”  That’s as it should be.  Any act – such as the denial of a single claim for benefits – could theoretically be broken down into a series of smaller “sub-acts.” That doesn’t mean the punishment should be multiplied by the number of sub-acts.  (See also Walker v. Farmers Ins. Exch. (2007) 153 Cal.App.4th 965, 975; 63 Cal. Rptr. 3d 507)  Courts should not be in the business of finding ways to maximize a plaintiff’s punitive award.  By definition, in the constitutionality jurisprudence, the plaintiff is made whole by the compensatory award;  the punitive award punishes the defendant; it does not compensate the plaintiff for the injury.

2. Physical harm is worse than economic harm, but, relatively speaking, a defendant who causes economic injury to a financially vulnerable plaintiff deserves more punishment.  

Amerigraphics suggested that the very nature of the insurance relationship means that insureds will qualify as “financially vulnerable.”  The court relied on the “unique” nature of the relationship: insureds purchase policies “precisely to buy peace of mind and security.” Therefore, an insured is “not on equal footing . . . .” with its insurer.  That may have been true in the Amerigraphics case, which involved a small insured put out of business by the carrier’s claims handling, but it does not apply across the board, nor should it.  When, e.g., the insured is a large corporation with an insurance claim, the parties are on relatively equal footing.  The concept of financial vulnerability is not automatically satisfied merely because this is an insurance relationship.  Example in point: Slottow v. Amer. Cas. Co. of Reading, Pa. (9th Cir. 1993) 10 F.3d 1355, 1362 (applying Calif. law.)

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The Illinois Supreme Court announced this afternoon that it will release seven opinions [pdf] on the morning of Thursday, April 15th, including two civil cases:

• No. 106511, Carter v. SSC Odin Operating Company, LLC, which presents the issue of whether the clauses of the Illinois Nursing Home Care Act invalidating any contractual provision limiting a resident's cause of action under the Act, or waiving jury trial, are preempted by the Federal Arbitration Act?
   
• No. 107146, Slovinski v. Elliott, which presents the following issues: (1) Must a Circuit Court make findings of fact and conclusions of law before it may set aside a jury's award of punitive damages?  (2) What standard of review applies to an Appellate Court's power to review a punitive damages award? and (3) May a party attack a punitive damages award based on lack of evidence, when the party declined to produce that evidence in discovery? 

For full details on these cases, click our Illinois Supreme Court Update.  These cases can be found under the links for Arbitration, Punitive Damages, and Civil Procedure, respectively.

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According to the San Francisco Chronicle, two new candidates have emerged as possible Supreme Court nominees to replace retiring Justice John Paul Stevens. 

Justice Carlos Moreno of the California Supreme Court began his career as a deputy city attorney in Los Angeles.  Justice Moreno received his first two judicial nominations from Republican Governors George Deukmejian and Pete Wilson. In 1998, he was appointed to the United States District Court by President Clinton. In 2001, he was appointed to the California Supreme Court by Democratic Governor Gray Davis.

Judge Kim McLane Wardlaw of the Ninth Circuit was in private practice until 1995. She was appointed to the United States District Court by President Clinton in 1995, and elevated to the Ninth Circuit in 1998.

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President Obama made a statement this afternoon, suggesting that he would nominate a replacement for retiring Justice John Paul Stevens within "weeks." In describing his ideal nominee, the President suggested that he would be looking for someone who agreed with Stevens' spirited dissent in Citizens United v. FEC:

I will seek someone in the coming weeks with similar qualities -- an independent mind, a record of excellence and integrity, a fierce dedication to the rule of law, and a keen understanding of how the law affects the daily lives of the American people.  It will also be someone who, like Justice Stevens, knows that in a democracy, powerful interests must not be allowed to drown out the voices of ordinary citizens. 

Senator Patrick Leahy, the chair of the Senate Judiciary Committee, said today that he expected to have hearings on the President's Supreme Court nominee this summer.  Meanwhile, Newsweek is reporting that Secretary of Homeland Security Janet Napolitano is on the short list for the vacancy, along with Solicitor General Elena Kagan, Judge Diane Wood and Judge Merrick Garland.

Reaction to Stevens' announcement continues in Washington.  Vice President Joseph Biden issued a statement.  Tony Mauro at The Legal Times has the statements of the other Justices, plus retired Justices O'Connor and Souter. The Ninth Justice, the National Journal's new blog on the Supreme Court vacancy, has reactions from many more Senators.

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The New York Times and CNN are reporting that Justice John Paul Stevens will retire when the Court reaches the end of its term in June.  The Appellate Strategist will post further information on the story as President Obama's search for a successor shifts into high gear.

UPDATE: The Supreme Court has posted a copy of Justice Stevens' retirement letter [pdf].  As Douglas Berman points out over at Sentencing Law and Policy, Justice Stevens has increased pressure on the Senate to confirm a replacement quickly by making his retirement effective when the Court rises for the summer, not when his replacement is confirmed and sworn in.  Tony Mauro at The Legal Times  has reactions from members of the Senate and Chief Justice Roberts' statement.

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Within the past several weeks, Supreme Court Justice John Paul Stevens has dropped several hints that he might be about to announce his retirement.   Even though nothing’s definite yet, the news media and the legal blogs are busy speculating about possible replacements. Here’s the roundup – both the “short list” and some of the long shots:

According to The Washington Post’s blog, The Swamp, Jess Bravin of The Wall Street Journal  and Mark Sherman at The Associated Press, there are only three names on the list:

• Solicitor General Elena Kagan, the former Dean of Harvard Law School,  who has served as Solicitor General since 2009;
   
• Judge Diane Wood of the Seventh Circuit.  Before her appointment, Judge Wood was Deputy Assistant Attorney General in the Antitrust Division of the Justice Department; and
   
• Judge Merrick Garland of the D.C. Circuit. Judge Garland was Principal Associate Deputy Attorney General under President Clinton before his elevation to the Court of Appeals.

Kevin Rudin of National Public Radio lists General Kagan and Judges Wood and Garland as the front-runners, but suggests two intriguing possibilities:

• Governor Jennifer Granholm of Michigan. Governor Granholm served as state Attorney General for four years before being elected Governor; and
   
• Secretary of Homeland Security Janet Napolitano.  Before serving six years as Governor of Arizona, Secretary Napolitano served as United States Attorney and state Attorney General.

Tom Goldstein of SCOTUSBlog writes that there is only one real candidate: General Kagan. Nevertheless, he handicaps a number of additional possibilities in addition to Judges Wood and Garland and Governor Granholm:

• Secretary of State Hillary Clinton;
   
• Professor Cass R. Sunstein, who is Felix Frankfurter Professor of Law at Harvard, and currently serves as Administrator of the Office of Management and Budget Office of Information and Regulatory Affairs;
   
• Attorney General Eric Holder;
   
• Governor Deval Patrick of Massachusetts. Governor Patrick served as Assistant Attorney General for the Civil Rights Division in the Clinton Justice Department. From 2000 through 2004, he was General Counsel and Executive Vice President of Coca-Cola; and
   
• Senator Amy Klobuchar of Minnesota.  Senator Klobuchar served as a county prosecutor for several years and later was in private practice.

At the New York Times, Peter Baker lists a number of these candidates and adds four new ones:

• Professor Harold Koh, former Dean of Yale Law School, where he specialized in international law, and now the Legal Adviser to the State Department;
   
• Professor Pamela S. Karlan of Stanford, who specializes in voting rights and the political process;
   
• Senator Richard Durbin of Illinois, who was both in private practice for a number of years before his election to Congress in 1983; and
   
• Senator Claire McCaskill of Missouri, who was a long-time local prosecutor before her election as state Auditor.

Finally, Law 360 interviewed appellate specialists from leading firms around the country, asking them to complete this sentence: “If I were Obama, My Supreme Court Pick Would Be . . ."

The results were interesting and – with the exception of General Kagan’s six votes – showed little overlap with the list of candidates discussed above. Aside from Professor Kathleen Sullivan of Stanford Law School, an authority on constitutional law who was prominently mentioned last year when Justice Souter retired, the only new candidate receiving more than one nomination was the person I suggested:

"In nominating a successor to Justice John Paul Stevens, President Obama should seek not only a brilliant lawyer, but someone who would bring a breadth of real-world experience to a Court which today consists of nine former judges from the Federal Circuits.  Through most of the twentieth century, Supreme Court nominees were frequently drawn from outside the Federal appellate courts, including Congress, the Cabinet and the private bar.  President Obama should revive that tradition by nominating Senator Sheldon Whitehouse of Rhode Island.

Over the next decade, the Supreme Court will likely face a range of important issues in criminal law, including Federal sentencing, the death penalty, habeas corpus and issues arising from the Government’s anti-terrorism efforts.  Senator Whitehouse would bring an important perspective to these issues, having served as both a United States Attorney and as his state’s Attorney General before his election to the Senate, as well as serving on the Judiciary Committee and the Select Committee on Intelligence in the Senate.

In addition, the Court will certainly be asked over the next several years to define the parameters of its recent landmark cases impacting both the legislative and political process, such as Heller v. District of Columbia and Citizens United v. FEC.  Having served in both the state and Federal government, Senator Whitehouse would bring a deep understanding of those worlds, far removed from the judiciary, to the Court’s debates.

In his four years in the Senate, Senator Whitehouse has demonstrated not only that he has a keen legal mind, but has shown himself to be an incisive, aggressive investigator in Senate committee rooms.  Two of the finest twentieth-century Justices -- Hugo Black and Earl Warren -- held political office before joining the Court.  President Obama should elevate another: Senator Sheldon Whitehouse."

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Statistics show that the number of civil cases accepted for review by California’s highest court has varied dramatically in recent years, but by any count, the numbers are still small.

According to a report released by the State’s Administrative Office of the Courts, for the year 2008, the California Supreme Court granted 6% of all civil petitions for review, down from 8% the previous year (2007) but up from the mere 3% granted in 2006. 

For 2008, out of a total of 5,989 civil petitions, the court
• denied just over 5,400
• outright granted 82
• granted and held 210
• granted and transferred 51 back to the intermediate court of appeal. 

These numbers may seem exceedingly low, but consider that many litigants just don’t understand the court’s limited function in reviewing decisions of the lower courts.  Review by the California Supreme Court is discretionary.  As a judicial policy maker, the court typically accepts only those issues that may affect other litigants or when necessary to resolve a conflict in the published decisions.  But many litigants do not understand this unique function, choosing to seek review even when they cannot satisfy these special requirements.  Thus, a great many petitions are denied out of hand.

Maximizing the chances for review:  read and comply with the court’s special requirements.  Follow the rules.  List the issue presented first, followed by an explanation of why this case deserves to be one of the select few that should make the cut.  The petition for review is less a legal document, explaining why the petitioner should win under the law, than it is a persuasive plea on why the court should hear the case.

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The problem of coverage for the so-called "innocent insured" is a recurring one.  The issue arises when there is more than one insured on the policy and one commits an act that would bar coverage.  Does that act bar coverage for all, or only for the intentional actor?  In California, this problem has reared its head again, or, more accurately, two heads, in the form of two cases the state Supreme Court has agreed to hear and decide.  One presents the issue in the context of property coverage, the other as whether there is a duty to defend the non-actor insured under a liability policy.

• Century National Ins. Co. v. Garcia, S179252, rev. gr. 3/17/10.  The state Supreme Court just granted review last week.  At issue is whether an insurer may enforce an exclusion in a fire policy that denies coverage to "innocent insureds" for damages from a fire intentionally caused by a coinsured.  The gist of the insured's argument is that California Insurance Code Section 2071 mandates the language of fire policies, and it couches the intentional acts exclusion in terms of "the insured."  Century National's policy barred coverage for all when any insured acted intentionally.  Garcia asks whether insurers may deviate from the statute's prescribed language, and to what extent.
   
• Minkler v. Safeco Ins. Co., S174106, question certified 8/12/10.  Minkler, now fully briefed, asks whether the severability clause in a liability insurance policy can trump an intentional acts exclusion which prohibits coverage for all insureds when "an insured" -- i.e., any insured -- has committed an excluded intentional act.  In Minkler, one insured committed child sex abuse.  The victim sued not only the abuser but his mother, also an insured, for negligently-supervising her adult son.  The victim and insured in Minkler argue that the severability clause creates separate insurance policies, and therefore, an "innocent" insured sued for negligently-supervising the intentional actor is entitled to a defense.  Their theory is that because there supposedly are "separate" policies, the only intent that is relevant is that of the mother, who never committed an intentional act.  The insurer, by contrast, contends that the severability clause was never designed to rewrite the plain language of the exclusions.  The insurer is represented by Appellate Strategist lawyers.

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Insurance brokers in Florida can now be liable to insurance companies which suffer a loss as a result of the broker’s own fraud or negligence in providing information in an application material to the issuance of a policy.

An appellate court in Florida has issued an opinion applying section 552 of the Restatement (Second) of Torts to insurance brokers, thus allowing claims for negligence and fraudulent misrepresentation to proceed against a broker who did not fully disclose all material information relied upon by the insurance company in issuing a policy.

In Liberty Surplus Ins. Corp., Inc. v. First Indemnity Ins. Servs., Inc. (.pdf), Florida’s Fourth District Court of Appeal reversed the trial court’s dismissal of a complaint filed by an insurance company against a broker for, among other things, negligence and fraudulent misrepresentation. The broker had submitted an application for professional liability insurance on behalf of a law firm. The law firm provided full disclosure to the broker of numerous malpractice claims and disciplinary proceedings involving the firm and its members over the preceding 5-year period; however, the broker only forwarded some, but not all, of that information to the insurance company as part of the application. The insurance company issued and subsequently renewed the professional liability policy to the law firm.

After the law firm was sued in a class action for professional malpractice action, the insurance company discovered the information about the prior claims and proceedings that the broker had not disclosed. The insurance company settled the underlying lawsuit against its insured and filed a complaint against the broker to recover the amount it paid. The trial court dismissed the complaint with prejudice on the ground that any misrepresentations or altering of the application by the broker were imputed to the insured and no legal relationship existed between the insurer and broker.

Section 552 of the Restatement (Second) of Torts provides:

(1) One who, in the course, of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.

Although Florida had previously adopted section 552 and applied it to professionals such as accountants, title agents, and other types of professionals who supply information to business transactions, that provision had never been expressly applied to insurance brokers – until now. The court found the application of section 552 to an insurance broker to be appropriate when the broker submits an application for insurance that fails to disclose material facts about the applicant that the insurer justifiably relies upon in issuing a policy.

As such, insurance companies can now sue brokers in Florida for negligently or fraudulently misrepresenting or withholding material facts in an application for insurance.

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This afternoon, the Illinois Supreme Court allowed petitions for review in eight new civil cases.  They are:

• Williams v. Board of Review, 395 Ill.App.3d 337 (1st Dist., 2009), which involves review of a decision by the Board of Review of the Department of Employment Security to deny a terminated employee's application for a Federally-funded trade readjustment allowance;
   
• In re County Collector of Du Page Co., 2009 WL 3970918 (2nd Dist., 2009), a case involving the scope of the power to tax on behalf of a forest preserve district to pay for the district's contribution to the Municipal Retirement Fund;
   
• In re Torski C., 395 Ill.App.3d 1010 (4th Dist., 2009), which involves the question of whether the definition of "dangerous conduct" found in the involuntary commitment statute is void for vagueness;
   
• Ries v. City of Chicago, 396 Ill.App.3d 418 (1st Dist., 2009), a personal injury suit involving the scope of a city's immunity from liability for the conduct of a police officer during the pursuit of a stolen police vehicle;
   
• Johnston v. Weil, 336 Ill.Dec. 285 (1st Dist., 2009), which involves the question of whether the Confidentiality Act applies to communications during an evaluation made by a court-appointed independent evaluator with respect to custody and visitation issues;
   
• Kaufman v. Jersey Community Hospital, 396 Ill.App.3d 729 (4th Dist., 2009), which involves the construction of Section 8-101 of the Tort Immunity Act, 745 ILCS 10/8-101, providing limitations periods governing (a) claims against local entities or their employees; and (b) claims against such entities arising out of patient care;
   
• Goodman v. Ward, 2010 WL 184081 (3rd Dist., 2010), which involves the question of whether a candidate for a judgeship in a particular subcircuit must be a resident of that subcircuit on the date of his ballot petition; and
   
• Hossfeld v. Illinois State Board of Elections, 2010 WL 743877 (1st Dist., 2010), which involves the meaning of the requirement that a candidate for state Senate in a primary election must be a "qualified primary voter" of his or her party.

We will update Appellate Strategist's database of civil issues pending at the Illinois Supreme Court shortly with our analysis of these new cases.

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The Appellate Strategist was the first blog to offer a comprehensive, regularly-updated database of civil issues -- broken down by category and subject matter -- that the California Supreme Court has agreed to hear and decide.

We are proud to announce two new features.

1. Since this "preview of coming attractions" has been one of our most popular features, we have expanded our reach to track and report on civil issues pending before the Texas Supreme Court and the Illinois Supreme Court.
    
2. In the coming months, we will be adding Florida, New York and New Jersey to our coverage of state Supreme Courts. 

We welcome your comments.

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If a business evicts a patron on the grounds that he's intoxicated, puts him in his car and requires him to drive away, does the business have a tort duty to persons the patron injures?  According to the Illinois Supreme Court, the answer is "yes."  Simmons v. Homatas, No. 108108(.pdf).

Defendant Homatas visited a strip club.  Because the club featured nude dancing, it was barred from holding a liquor license.  However, the club encouraged patrons to bring their own liquor into the club, and defendant did so.  When Homatas was discovered vomiting in the restroom, club employees ejected him from the club, instructed the valet service to bring his car to the front door, put him in the car and required him to drive away.  Not long after, Homatas collided with another car, killing three passengers.

Because the club didn't sell Homatas liquor, the plaintiffs couldn't recover under the Dram Shop Act.  But that wasn't the end of it, according to the Court.  The Dram Shop Act only preempts claims based on the act of selling or providing alcoholic beverages; it doesn't necessarily preclude liability for conduct independent of providing alcohol which led to a plaintiff's injuries.  The club argued that it had no duty to determine whether Homatas was intoxicated, but the Court held it wasn't imposing one -- club employees had voluntarily concluded that the defendant was intoxicated and taken it upon themselves to force him to get in his car and drive away.

The Court held that plaintiffs' complaint alleged enough facts to give the club a common law duty within the meaning of Section 876 of the Restatement of Torts, which imposes liability on those who give substantial assistance or encouragement to someone's tortious conduct.  Justices Freeman and Burke dissented, concluding that plaintiffs' factual allegations weren't sufficient for liability to attach.  Their opinion is a good road map to defense counsel arguing that plaintiffs' allegations aren't "substantial" enough to satisfy Section 876.

The majority took pains to discourage anyone wanting to interpret its holding expansively.  The case presented "special circumstances," the Court wrote:

We do not hold today that restaurants, parking lot attendants or social hosts are required to monitor their patrons and guests to determine whether they are intoxicated.  We hold only that where . . . a defendant is alleged to have removed a patron for being intoxicated, places the patron into a vehicle and requires him to drive off, such facts are sufficient to state a common law negligence cause of action.

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Nacht & Lewis Architects, Inc. v. Superior Court may be the most widely cited case in California.  It seems to appear in most responses to Form Interrogatory Nos. 12.2 and 12.3 to justify refusing to produce recorded interviews of witnesses, any resulting attorney notes, or a list of interviewed witnesses.  Now those numerous discovery responses may be in question.  In Coito v. Superior Court, [pdf] California's Fifth District Court of Appeal considered and rejected Nacht, holding in a divided decision that attorney notes from witness interviews and the list of those interviewed will often be discoverable. 

These conflicting decisions leave two crucial questions unresolved. 1) Do the questions asked by counsel in an interview reveal counsel’s impressions, conclusions, opinions, or theories?  2) Does the selection of who to interview reveal the same?  Coito says not usually to both, Nacht says yes.  Given the frequency in which these issues arise, the state Supreme Court may be asked to intervene to clarify the issue and provide clear guidelines for California litigators and overworked trial courts.

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The California Court of Appeal has issued an opinion which, if allowed to stand, threatens to eat away at the once-settled body of law that prohibits third-party claimants who were injured by an insured from suing the insured's insurance company for unfair claims settlement practices under California Insurance Code § 790.03.  Over 20 years ago, the State Supreme Court held that only the State's Insurance Commissioner may pursue insurers for improper settlement practices under that statute; § 790.03 does not grant either insureds or third-party claimants the right to sue insurers for violating the statute's prohibitions.  (Moradi-Shalal v. Fireman's Fund Ins. Companies (1988) 46 Cal.3d 287.)

But the new opinion -- from the intermediate appellate court -- would create a loophole that could accommodate a whole fleet of trucks.  (Zhang v. Superior Court (2009) 178 Cal.App.4th 1081.)  According to Zhang, if plaintiff's allegations are not limited to unfair claims handling, but also include "specific" allegations that the insurer "made fraudulent misrepresentations and promulgated misleading advertising" -- i.e., it never intended to pay covered claims -- the complaint will survive the insurer's demurrer challenge.  However, to prevail, plaintiff would be required to prove the insurer made false representations to the public and that the insurer had a policy that was inconsistent with these representations.

Zhang candidly acknowledged it disagreed with a prior opinion which held squarely to the contrary.  (Textron Financial Corp. v. National Union Fire Ins. Co. (2004) 118 Cal.App.4th 1061.)  The conflict in the published opinions of the intermediate appellate courts makes Zhang a prime candidate for review by the California Supreme Court.  Indeed, the high court extended its time to rule on the insurer's Petition for Review until March 9.  (Ptn. for Review filed 12/09/09, No. S18542.)

Zhang is a troubling opinion, and Appellate Strategist urges interested parties to support the insurer's petition.  It is easy enough to allege a policy or practice.  Under this decision, that alone is sufficient to defeat the insurer's demurrer against what should have been a stillborn claim.  The value of Moradi-Shalal is that it deals an immediate fatal blow, saving defendants the time and expense of discovery and trial on allegations a plaintiff cannot possibly prove.  If Zhang survives, the insurer cannot defeat the suit short of a motion for summary judgment, and perhaps not even then.

Continue Reading...

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In 2003, Congress enacted the latest version of the Medicare Act.  It contained far broader language than previous versions on what State law claims it preempted: “The standards established under this part shall supersede any State law or regulation (other than State licensing laws or State laws relating to plan solvency) with respect to MA [Medicare Advantage] plans which are offered  by MA organizations under this part.” (42 U.S.C. § 1395w-26(b)(3).) 

The scope and meaning of this new preemption language is being litigated around the country, but as yet precious few cases have made their way through the appellate courts.  One that has comes out of California.  In Yarick v. PacifiCare of California (2009) 179 Cal. App. 4th 1158, the State’s intermediate Court of Appeal held the 2003 Act expressly preempted the enrollee’s statutorily-based state causes of action, and impliedly preempted state common law claims.  Yarick also rejected plaintiffs’ argument that the licensing exception within the Medicare Act's preemption clause could save the claims. Months before, the Ninth Circuit Court of Appeals had reached a similar conclusion, but then granted rehearing.  (Uhm v. Humana, Inc. (9th Cir. Docket No. 06-35672).  Since a grant of rehearing vacates a published opinion, the score rolled back to zero. 

Now the score is back to Plans: 1; enrollees: 0.  As of this writing, Yarick is the only published appellate case anywhere in the country to address the preemption defense on the merits. (Previously, the Eleventh Circuit Court of Appeals rejected an argument that the Medicare Act completely preempted state law claims to afford federal court's subject matter jurisdiction. (Dial v. Healthspring of Alabama, Inc. (11th Cir. 2008) 541 F.3d 1044).)    This is an important and recurring issue, and we haven’t heard the last of it.  Expect to see all manner of decisions on this hot-button question from courts around the country.  As those opinions come down, Appellate Strategist will report on them, and provide a running total  box score.

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Medical Malpractice – Wrongful Death. Is an arbitration clause in a doctor-patient financial agreement which required all disputes relating to diagnosis, treatment, or care of patient be resolved by arbitration, limited non-economic damages and required compliance with the presuit notice requirements contrary to the public policy embodied in Chapter 766? Franks v. Bowers, No. SC11-1258 (review granted Nov. 8, 2011). DCA decision: 62 So. 3d 16 (Fla. 1st DCA 2011). Status: briefing complete, Oral Argument scheduled for June 5, 2012.

Statute of Limitation. Is a wrongful death action barred by the statute of limitation because any personal injury action abated upon death of the decedent, and a separate wrongful death action was not filed prior to the expiration of the two-year statute of limitation for that cause of action? Capone v. Philip Morris USA, Inc., No. SC11-849 (review granted Oct. 17, 2011). DCA decision: 56 So. 3d 34 (Fla. 3d DCA 2010). Status: briefing; Oral Argument scheduled for June 5, 2012.

 

Nursing Homes – Arbitration Clause. Question Certified: Does the execution of a nursing home arbitration agreement by a party with the capacity to contract, bind the patient’s estate and statutory heirs in a subsequent wrongful death action arising from an alleged tort within the scope of an otherwise valid arbitration agreement? Laizure v. Avante at Leesburg, Inc., No. SC10-2132 (review granted Dec. 14, 2010). DCA decision: 44 So. 3d 1254 (Fla. 5th DCA 2010). Status: briefing complete; no Oral Argument.

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Negligence – Duty to Inspect - New Trial.   Did the trial court abuse its discretion in granting a new trial on the basis that the jury verdict in favor of defendant was contrary to the manifest weight of the evidence where review of the record reveals substantial conflicting evidence concerning reasonableness of the defendant’s inspection of a backhoe loader and its breaking system? Did trial court abuse its discretion in granting new trial based on defense counsel’s references to the exculpatory language in the consumer service agreement during closing arguments where plaintiff failed to object or move for a mistrial and where argument failed to rise to the level of fundamental error because the argument was not improper, harmful, incurable or damaging? Rosier v. Ring Power Corp., No. SC11-1641 (review granted March 23, 2012). DCA decision: 67 So. 3d 1115 (Fla. 1st DCA 2011). Status: briefing; Oral Argument to be set by separate order.

Medical Malpractice – Limitation of Actions.  Is a complaint untimely filed when the plaintiff has purchased a 90-day extension of the statute of limitations pursuant to section 766.104(2), Florida Statutes, and when negotiations are cut off with less than 60 days remaining of the statute of limitations, but the complaint is not filed until 78 days later? Patrick v. Gatien, SC11-1466 (review granted Feb. 7, 2012). DCA decision: 65 So. 3d 42 (Fla. 1st DCA 2011). Status: briefing, Oral Argument to be set by separate order.

Medical Malpractice – Wrongful Death. Is an arbitration clause in a doctor-patient financial agreement which required all disputes relating to diagnosis, treatment, or care of patient be resolved by arbitration, limited non-economic damages and required compliance with the presuit notice requirements contrary to the public policy embodied in Chapter 766? Franks v. Bowers, No. SC11-1258 (review granted Nov. 8, 2011). DCA decision: 62 So. 3d 16 (Fla. 1st DCA 2011). Status: briefing complete; Oral Argument scheduled for June 5, 2012.

Public Employees – Unfair Labor Practices: Does conduct, which included granting the employee sick leave and then accusing him of abandoning his job; unfairly charging employee with violating a regulation regarding his computer password; failing to enthusiastically endorse employee’s “Rookie Teacher-of-the-Year” award; failing to place employee’s “Rookie Teacher-of-the-Year” announcement on the forward face of the school marquee over spring break; and failing to personally announce employee’s award on the school intercom, sufficiently evidence animus to sustain allegations of unfair labor practices? Koren v. Sch. Bd. of Miami Dade Cnty., No. SC10-2366 (review granted April 18, 2011). DCA decision: 46 So. 3d 1090 (Fla. 3d DCA 2010). Status: decision pending; Oral Argument Video.

Negligence – Rear-End Collision. Whether presumption of negligence in rear-end collision applies where a passenger in the following vehicle sues the lead driver for negligence? Birge v. Charron, No. SC10-1755 (review granted May 13, 2011). DCA decision: 37 So. 3d 292 (Fla. 5th DCA 2010). Status: briefing complete; no Oral Argument.

Dental Malpractice – Physician’s Right to Confer with Attorney. Does allowing a treating physician to consult with his or her own attorney prior to being deposed violate the patient confidentiality statute? Hasan v. Garvar, No. SC10-1361 (review granted Jan. 21, 2011). DCA decision: 34 So. 3d 785 (Fla. 4th DCA 2010). Status: decision pending; Oral Argument Video

Birth Related Neurological Injury – Parental Compensation Statute. Question certified: Does the limitation in section 766.31(1)(b)1., Florida Statutes, of a single award of $100,000 to both parents violate the Equal Protection Clause of the United States and Florida Constitutions? Samples v. Fla. Birth Related Neurological Injury Comp. Ass’n, No. SC10-1295 (review granted Sept. 17, 2010). DCA decision: 40 So. 3d 18 (Fla. 5th DCA 2010). Status: decision pending; Oral Argument Video.

Economic Loss Rule – Professional Service:  Question Certified from the Eleventh Circuit Court of Appeals:  Does an insurance broker provide a “professional service” such that the insurance broker is unable to successfully assert the economic loss rule as a bar to tort claims seeking economic damages that arise from the contractual relationship between the insurance broker and the insured?  Tiara Condo. Ass’n v. Marsh & McLennan Cos., No. SC10-1022 (review granted June 4, 2010).  11th Cir. decision:  607 F.3d 742 (11th Cir. 2010).  Status:  decision pending; Oral Argument Video.

Negligence – Rear-End Collision.  In the case of a rear-end collision, does the rebuttable presumption that the negligence of the rear driver was the sole proximate cause of the accident, which requires the driver to overcome the presumption by proving that the lead driver stopped abruptly or arbitrarily, apply where the rear driver is the plaintiff? Cevallos v. Rideout, No. SC09-2238 (review granted Apr. 20, 2010).  DCA decision: 18 So. 3d 661 (Fla. 4th DCA 2009).  Status:  decision pending; Oral Argument Video

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Taxation – Ad Valorem. Question Certified: Whether section 196.199(2)(b), Florida Statutes, is inapplicable to the real property at issue because appellants are the equitable owners of that property? Accardo v. Gregory S. Brown, Property Appraiser for Santa Rosa County, No. SC11-1445 (review granted February 29, 2012). DCA decision 63 So. 3d 798. Status: briefing; Oral Argument to be set by separate order.

Taxation – Ad Valorem: Whether trial court properly determined that leasholders were equitable owners and subject to ad valorem taxes on their leasehold improvements. 108 Ariola, LLC v. Jones, No. SC11-2231 (review granted  February 29, 2012). DCA decision 71 So. 3d 892 (Fla. 1st DCA 2011). Status: briefing; no Oral Argument.

Property Taxes – Homestead Exemption for Non-U.S. Citizens: Whether two Honduran citizens who lawfully own and reside in a Miami condo with their three U.S. citizen minor children may claim the ad valorem homestead exemption on their condo because their children are U.S. citizens, reside in the condo and are dependent on their parents. De La Mora v. Andonie, No. SC11-554 (review granted June 30, 2011). DCA decision: 51 So. 3d 517 (Fla. 3d DCA 2010). Status: decision pending; Oral Argument Video.

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Insurance – Compulsory Medical Examination. Whether an insured’s refusal to comply with policy’s requirement that she submit to a compulsory medical exam constitutes her failure to satisfy a condition precedent to recovery pursuant to the underinsured/uninsured benefits in the insurance policy. The Fifth District reversed her award, reasoning that “[h]er refusal constitutes a breach of the policy that prohibits her recovery.” State Farm Mut. Auto. Ins. Co. v. Curran, No. SC12-157 (review granted February 29, 2012). DCA decision --- So. 3d ---, (Fla. 5th DCA 2011), Nos. 5D09-1488, 5D09-2091). Status: briefing; Oral Argument to be set by separate order.

Insurance – Public Adjusters. Is section 626.854(6), Florida Statutes, which bans solicitation by public adjusters for a period of 48 hours, narrowly tailored to meet its objectives, or is it a ban on all solicitation for 48 hours which is a restriction on commercial speech in violation of Article I, section 4 of the Florida Constitution? Atwater v. Kortum, No. SC11-133 (review granted May 13, 2011). DCA decision: 54 So. 3d 1012 (Fla. 1st DCA 2010). Status: decision pending; Oral Argument Video

First Party Insurance Liability - Claims Handling: Questions certified by Eleventh Circuit Court of Appeals: (1) "Does Florida law recognize a claim for breach of the implied warranty of good faith and fair dealing by an insured based on the insurer's failure to investigate and assess the insured's claim within a reasonable period of time?" (2) "If Florida law recognizes a claim for breach of the implied warranty of good faith and fair dealing based on an insurer's failure to investigate and assess its insured's claim within a reasonable period of time, is the good faith and fair dealing claim subject to the same bifurcation requirement applicable to a bad faith claim under Fla. Stat. Sec. 624.155?" (3) "May an insured bring a claim against an insurer for failure to comply with the language and type-size requirements established by Fla. Stat. Sec. 627.701(4)(a)?" (4) Does an insurer's failure to comply with the language and type-size requirements established by Fla. Stat. Sec. 627.701(4)(a) render a noncompliant hurricane deductible provision in an insurance policy void and unenforceable?" and (5) "Does language in an insurance policy mandating payment of benefits upon 'entry of a final judgment' require an insurer to pay its insured upon entry of judgment at the trial level?"  Chalfonte Condo Apt. Ass'n v. QBE Ins. Corp., No. SC09-441 (review granted Mar. 11, 2009).  11th Cir. decision: 561 F.3d 1267 (11th Cir. 2009).  Status: decision pending; Oral Argument Video.

 

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Legislation – State University System: Do the statutes and provisions of the General Appropriations Act that restrict state universities’ expenditure or tuition and fees and condition appropriation of funds to each university upon compliance with the tuition and fee policies established by the Legislature contravene the authority of the Board of Governors under article IX, section 7(d) of the Florida Constitution to establish and expend tuition and fees? Graham v. Haridopolis, No. SC11-2453 (review granted Mar.15, 2012). DCA decision: 75 So. 3d 315 (Fla. 1st DCA 2011). Status: briefing; Oral Argument to be set by separate order.

Taxation – Ad Valorem. Question Certified: Whether section 196.199(2)(b), Florida Statutes, is inapplicable to the real property at issue because appellants are the equitable owners of that property? Accardo v. Gregory S. Borown, Property Appraiser for Santa Rosa County, No. SC11-1445 (review granted Feb. 29, 2012). DCA decision 63 So. 3d 798 (Fla. 1st DCA 2011). Status: briefing; Oral Argument to be set by separate order.

 

Municipal Corporations – Code Enforcement Liens. Question Certified: Whether, under Article VIII, section 2(b) of the Florida Constitution, section 166.021, Florida Statutes and Chapter 162, Florida Statutes, a municipality has the authority to enact an ordinance stating that its code enforcement liens, created pursuant to a code enforcement board order and recorded in the public records of the applicable county, shall be superior in dignity to prior recorded mortgages? City of Palm Bay v. Wells Fargo Bank, N.A., No. SC11-830 (review granted May 18, 2011). DCA decision:  67 So. 3d 271 (Fla. 5th DCA 2011). Status: decision pending; Oral Argument Video.

 

Dismissal – Sovereign Immunity.  Conflict and Question certified:  Whether, in light of the supreme court’s ruling in State Department of Education v. Roe, 679 So. 2d 756 (Fla. 1996), review of the denial of a motion to dismiss based on a claim of sovereign immunity should await the entry of a final judgment in the trial court?  Citizens Prop. Ins. Corp. v. San Perdido Ass’n, No. SC10-2433 (review granted Feb. 17, 2011).  DCA decision: 46 So. 3d 1051 (Fla. 1st DCA 2010).  Status: Decision pending: Oral Argument Video.

 

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There are no cases to report on at this time.

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Contracts - Implied Warranty of Habitability: Can a homeowners' association bring a claim for breach of common law implied warranties of fitness and merchantability - also referred to as a warranty of habitability - against a builder/developer for defects in roadways, drainage systems, retention ponds, and underground pipes in a residential subdivision or are such claims required to be brought by individual homeowners.  Lakeview Reserve Homeowners Ass'n, Inc. v. Moranda Homes, Inc., Nos. SC10-2292 & SC10-2336 (review granted Apr. 20, 2011).  DCA decision: 48 So. 3d 902 (Fla. 5th DCA 2010).  Status:  decision pending; Oral Argument Video.

Enforcement of Contract – Unlicensed Contractor: Does Florida Statutes § 489.128, which prevents an unlicensed contractor from enforcing a contract preclude other parties to the contract from enforcing the contract against the unlicensed contractor? Earth Trades Inc. v. T&G Corp., No. SC10-1892 (review granted Oct. 21, 2011). DCA decision: 42 So. 3d 929 (Fla. 5th DCA 2010). Status: decision pending; Oral Argument Video.

Statute of Frauds – Estoppel.  Where a seller orally promises to extend a contractual due diligence period, despite the fact that the initial contract mandates that all binding modifications be in writing, can the court apply equitable estoppel to prevent the seller from relying on the statute of frauds?  DK Arena, Inc. v. EB Acquisitions I, LLC, No. SC10-897 (review granted Nov. 5, 2010).  DCA decision: 31 So. 3d 313 (Fla. 4th DCA 2010).  Status: decision pending; Oral Argument Video.

 

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Statute of Frauds – Arbitration. Question Certified: Does section 95.011, Florida Statutes apply to arbitration when the parties have not expressly included a provision in their arbitration agreement stating that it is applicable? Raymond James Fin. Servs., Inc. v. Phillips, No. SC11-2513 (review granted January 27, 2012). DCA decision: 2011 WL 5555691, 36 Fla. L. Weekly D2479a (Fla. 2d DCA Nov. 16, 2011). Status: briefing, Oral Argument to be set by separate order.

Negligence – Duty to Inspect --- New Trial. Did the trial court abuse its discretion in granting a new trial on the basis that the jury verdict in favor of defendant was contrary to the manifest weight of the evidence where review of the record reveals substantial conflicting evidence concerning reasonableness of the defendant’s inspection of a backhoe loader and its breaking system? Did trial court abuse its discretion in granting new trial based on defense counsel’s references to the exculpatory language in the consumer service agreement during closing arguments where plaintiff failed to object or move for a mistrial and where argument failed to rise to the level of fundamental error because the argument was not improper, harmful, incurable or damaging? Rosier v. Ring Power Corp., No. SC11-1641 (review granted March 23, 2012). DCA decision: 67 So. 3d 1115 (Fla. 1st DCA 2011). Status: briefing; Oral Argument to be set by separate order.

Medical Malpractice – Limitation of Actions. Is a complaint untimely filed when the plaintiff has purchased a 90-day extension of the statute of limitations pursuant to § 766.104(2), Fla. Stat., and when negotiations are cut off with less than 60 days remaining of the statute of limitations, but the complaint is not filed until 78 days later? Patrick v. Gatien, SC11-1466 (review granted Feb. 7, 2012). DCA decision: 65 So. 3d 42 (Fla. 1st DCA 2011). Status: briefing; Oral Argument to be set by separate order.

Discovery of Corporate Financial Documents: Whether a corporation seeking damages relating to the purchase of state-owned real estate and suing for negligent misrepresentation, fraud in the inducement, unjust enrichment and reformation of a purchase contract can be compelled to produce corporate financial records dating several years after the purchase date in question. Am. Educ. Enters., LLC v. Bd. of Trs. of the Int’l Improvement Trust Fund, No. SC10-2251 (review granted June 28, 2011). DCA decision: 45 So. 3d 941 (Fla. 3d DCA 2010). Status: decision pending; Oral Argument Video.

 

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There are no cases to report on at this time.

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Litigation Privilege.  Is an attorney protected by the litigation privilege against claims for defamation and tortious interference when he related to another party’s ex-spouses and former business associates that the party utilized prostitutes to entice business clients and that the party was being prosecuted for prostitution? Del Monico v. Traynor, No. SC10-1397 (review granted Nov. 12, 2010). DCA decision: 47 So. 3d 1287 (Fla. 4th DCA 2010). Status: decision pending; Oral Argument Video

Dental Malpractice – Physician’s Right to Confer with Attorney. Does allowing a treating physician to consult with his or her own attorney prior to being deposed violate the patient confidentiality statute? Hasan v. Garvar, No. SC10-1361 (review granted Jan. 21, 2011). DCA decision: 34 So. 3d 785 (Fla. 4th DCA 2010). Status: decision pending; Oral Argument Video

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Statute of Frauds – Arbitration. Question Certified: Does section 95.011, Florida Statutes apply to arbitration when the parties have not expressly included a provision in their arbitration agreement stating that it is applicable? Raymond James Fin. Servs., Inc. v. Phillips, No. SC11-2513 (review granted January 27, 2012). DCA decision:  2011 WL 5555691, 36 Fla. L. Weekly D2479a (Fla. 2d DCA Nov. 16, 2011). Status: briefing; Oral Argument to be set by separate order.

 

Medical Malpractice – Wrongful Death. Is an arbitration clause in a doctor-patient financial agreement which required all disputes relating to diagnosis, treatment, or care of patient be resolved by arbitration, limited non-economic damages and required compliance with the presuit notice requirements contrary to the public policy embodied in Chapter 766? Franks v. Bowers, No. SC11-1258 (review granted Nov. 8, 2011). DCA decision: 62 So. 3d 16 (Fla. 1st DCA 2011). Status: briefing complete; Oral Argument scheduled for June 5, 2012.

 

Fraud – Arbitration. Conflict Certified: Was an arbitration clause in a real estate contract applicable to plaintiff's action alleging that plaintiff's decision to purchase property was based on defendant's fraudulent misrepresentation in an advertisement that a "wetlands study verifies no wetlands" where the fraud claim was not significantly related to the contract.  Jackson v. Shakespear Foundation, Inc., No. SC11-1196 (review granted Nov. 8, 2011). DCA decision: 61 So. 3d 1194 (Fla. 1st DCA 2011). Status: briefing; Oral Argument scheduled for June 5, 2012.

 

Nursing Homes – Arbitration Clause. Question Certified: Does the execution of a nursing home arbitration agreement by a party with the capacity to contract, bind the patient’s estate and statutory heirs in a subsequent wrongful death action arising from an alleged tort within the scope of an otherwise valid arbitration agreement? Laizure v. Avante at Leesburg, Inc., No. SC10-2132 (review granted Dec. 14, 2010). DCA decision: 44 So. 3d 1254 (Fla. 5th DCA 2010). Status: briefing complete; no Oral Argument.

 

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Certiorari – Sovereign Immunity. Conflict Certified: The Third DCA acceptedjurisdiction over a governmental entity's claim that it is immune from suit, rather than it is not liable for lack of duty, and in so doing certified conflict with the decisions in Florida A & M University Board of Trustees v. Thomas, 19 So. 3d 445 (Fla. 5th DCA 2009), and Pinellas Suncoast Transit Authority v. Wrye, 750 So. 2d 30 (Fla. 2d DCA 1996). Rodriguez v. Miami-Dade County, No. SC11-1913 (review granted Dec. 1, 2011). DCA decision 67 So. 3d 1213 (Fla. 3d DCA 2011). Status: briefing; Oral Argument to be set by separate order.

Dismissal – Sovereign Immunity.  Conflict and Question certified:  Whether, in light of the supreme court’s ruling in State Department of Education v. Roe, 679 So. 2d 756 (Fla. 1996), review of the denial of a motion to dismiss based on a claim of sovereign immunity should await the entry of a final judgment in the trial court?  Citizens Prop. Ins. Corp. v. San Perdido Ass’n, No. SC10-2433 (review granted Feb. 17, 2011).  DCA decision: 46 So. 3d 1051 (Fla. 1st DCA 2010).  Status: Decision pending; Oral Argument Video

Certiorari – Interlocutory Review on Issue of Immunity.  Is a city bus driver sued for negligence in striking a pedestrian entitled to interlocutory review by certiorari of the denial of his summary judgment on grounds of immunity?  Keck v. Eminisor, No. SC10-2306 (review granted Dec. 30, 2010).  DCA decision: 46 So. 3d 1065 (Fla. 1st DCA 2010).  Status: Decision pending; Oral Argument Video.

*Certiorari – Administrative Order.  Question Certified: May a district court grant common law certiorari relief from a circuit court’s opinion reviewing an administrative order when the circuit court applied precedent from another district court but the reviewing district court concludes that the precedent misinterprets clearly established statutory law?  Dep't of Highway Safety & Motor Vehicles v. Nader, No. SC09-1533 (review granted May 7, 2010).  DCA decision: 4 So. 3d 705 (Fla. 2d DCA 2009).  Status:  Decision below approved.; Slip Opinion; Motion for rehearing denied on May 4, 2012).

 

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Can a California trial court reduce a personal injury plaintiff's recovery for medical expenses to reflect the amount actually paid by his health insurer?  That question matters a lot to attorneys, parties and insurers, trying to value claims and where appropriate, seek settlements in thousands of cases every day.

For twenty years, the answer under California law was "yes," as held in Hanif v. Housing Authority (1988) 200 Cal.App.3d 635 and Nishihama v. City and County of San Francisco (2001) 93 Cal.App.4th 298.  In November, California's Fourth District Court of Appeal held that the answer was "no."  Howell v. Hamilton Meats & Provisions, Inc. [pdf] (2009) 179 Cal.App.4th 686.

On March 10, 2010, the California Supreme Court agreed to review Howell and resolve the conflict.  By virtue of the Court's order, Howell is automatically depublished and non-citable, making Hanif and Nishihama the only precedent on this important question until the Supreme Court speaks in Howell.

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A party in case before the Texas Supreme Court grew so frustrated by waiting for an opinion almost three years after oral argument that it sued the justices in federal court, alleging due process violations. Coincidentally (or not) the Supreme Court issued an opinion eight days later.

The court heard oral arguments in Southwestern Bell Tel. Co. v. Marketing on Hold, Inc. in March, 2007. The case was an interlocutory appeal of a class certification order entered in litigation challenging Southwestern Bell's right to charge certain municipal fees. The issues on appeal centered on whether Marketing on Hold, a phone bill auditing firm that had an taken assignment of rights as part of its fee to its business customers had standing in the case and whether it constituted an "adequate" class representative.

The parties had heard nothing further from the case by February, 2010. Marketing on Hold took the unusual step of of suing the justices of the Texas Supreme Court in a federal district court in Austin. It argued that the lengthy delay in rendering a decision would cause documentary evidence to be lost and the memory of witnesses to fade, thereby violating its federal due process rights. The case sought only declaratory relief.

Only eight days after the suit was filed the Supreme Court issued its opinion in the case, No. 05-0748, February 19, 2010. The court held that the assignment of rights was valid and conferred standing on Marketing On Hold. Nevertheless, because Marketing On Hold had only a fractional interest in the claim by virtue of its assignment, it had an incentive to settle for less consideration and to minimize its own expenses. It was not, therefore, an adequate class representative. The certification order was reversed. The case divided the court, 5-3.

The frustration of litigants involved in seemingly interminable proceedings is understandable. The tactic of suing an appellate court to force an opinion is both extreme and likely to be ineffective. Not only is a federal district court extremely unlikely to intervene in the internal procedures of a state appellate court, the suit is apt to make a bad impression on the appellate court justices. As Marketing On Hold learned, "be careful what you wish for..."

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The California Supreme Court's website is a veritable goldmine of information. Unfortunately, it's not organized in a way that allows lawyers and clients to easily track issues the court has accepted for decision. We were the first site to regularly provide comprehensive and up to date information on all civil cases.  The Appellate Strategist has organized the pending issues according to subject matter. We will update periodically, as new reviews are granted, or opinions issue on old ones. Hope it's useful. (Updated through 5/4/12)

• Employment – Compensation & Benefits
• Employment – Other
• Insurance
• Torts & Products
• ADR
• Attorney-Related
• Damages
• B & P 17200/Class Actions/Commercial
• Appeals & Writs
• Civil Procedure/Evidence/Discovery
• Environmental
• Civil Rights
• Taxation and Assessments
• Other

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The Illinois Supreme Court has published its docket book for the March term, and the Court’s docket call will be heavy on civil matters this month in Springfield. 

On March 10, the Court will hear argument in Founders Insurance Co. v. Munoz, which involves the entitlement exclusion in personal automobile insurance policies, and Speed District 802 v. Warning, which involves an unfair labor practices charge arising out of the termination of a teacher’s contract.  The next day, the Court hears Pekin Insurance Co. v. Wilson, which presents issues of the scope of evidence relevant to an insurer’s duty to defend, Krywin v. Chicago Transit Authority, which relates a common carrier’s potential duty to clear away natural accumulations of snow and ice, and Clerk v. The Children’s Memorial Hospital, which involves the scope of Illinois’ cause of action for wrongful birth.

On March 16, the Court will hear argument in Baumgartner v. Baumgartner.  There, the principal issue is whether incarceration is an act of self-emancipation terminating the support obligation in a divorce decree.  The Court will also hear K. Miller Construction Co. v. McGinnis, which involves the construction of the Home Repair and Remodeling Act.  Finally, on March 17, the Court hears Cwik v. Giannoulias, a putative class action alleging that the state’s practice of not paying over interest or income earned by reclaimed property while in the state’s custody is an unconstitutional taking of property without compensation.

Decisions in each of these cases should come later in the year.

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[UPDATED THROUGH May 14, 2012]

Goodman v. Ward

Supreme Court Case Number: 109796

Appellate Court: Third District

Appellate Court Case Number: 3-09-1031

Issue Presented: Is a candidate for a judgeship in a particular judicial subcircuit required to be a resident of that subcircuit on the date the candidate petitions to have his or her name placed on the primary ballot?

Appellate Court Opinion Summary: Petitioner challenged the listing on the primary ballot of a candidate for Circuit Court Judge of the Twelfth Judicial Circuit, Fourth Subcircuit. Petitioner argued that the candidate’s lack of residency within the subcircuit made him ineligible as a candidate pursuant to Article VI, Section 12 of the Illinois Constitution, which requires that a candidate be a “resident of the unit which selects him.” Following Thies v. State Board of Elections, 124 Ill.2d 317 (1988) and Maddux v. Blagojevich, 233 Ill.2d 508 (2009), the court held that when a judgeship concerns a portion of a circuit, a candidate must be a resident in that portion at the time of filing his or her nomination papers. Justice Wright dissented.

Citation to Opinion: 2010 WL 184081

 

Jackson v. The Board of Election Commissions of the City of Chicago

Supreme Court Case Number: 111928

Appellate Court: First District, Division Four

Appellate Court Case Number: 1-11-0361

Issue Presented: Are property taxes a "tax or other indebtedness due to the municipality" within the meaning of 65 ILCS 5/3.1-10-5(b), which provides that certain facts disqualify a candidate for an elective municipal office?

Appellate Court Opinion Summary: Appellee filed nominating papers to run as a candidate for Chicago City alderman. An objector's petition charged that appellee was not eligible to run because she was in arrears for back property taxes, and thus owed a "tax or other indebtedness due to the municipality" within the meaning of 65 ILCS 5/3.1-10-5(b). Relying upon a letter from the city of Chicago indicating that the city did not find a record of certain outstanding debts, the hearing officer overruled the objection, and the Board of Elections agreed. The objector appealed to the Circuit Court, which affirmed the Board of Elections. The Appellate Court found that the Electoral Board's decision was clearly erroneous and reversed. On appeal, appellee argued that because the city of Chicago would have no standing to enforce a judgment for unpaid property taxes, there was no "indebtedness due" to the city of Chicago. The Appellate Court disagreed, finding that the plain language of the statute provided that although property taxes were collected by the Cook County collector, the money was due to the city. The Court held that the city would have standing to enforce payment of its property taxes. The letter received by appellee from the city was not dispositive, the Court held, because city property taxes were collected through the county collector.

Appellate Court Opinion 

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[UPDATED THROUGH May 14, 2012]

In re Marriage of Coulter

Supreme Court Number: 113474

Appellate Court: Third District

Appellate Court Case Number: 3-11-0424

Issue Presented: May a trial court deny a petitioner's request for a preliminary injunction barring removal of the couple's minor children, pending a full hearing, where the parties had previously agreed that the wife could remove the children from the state at any time after 36 months from entry of judgment?

Appellate Court Opinion Summary: Petitioner and respondent entered into a joint parenting agreement following their divorce. The parties agreed that respondent could remove the children from the state at any time after 36 months from the entry of judgment. Petitioner subsequently filed an emergency petition for a preliminary injunction barring respondent from removing the children from the state, pending a hearing on whether removal was in the best interest of the children. The trial court denied the petition. The Appellate Court reversed. Pursuant to Section 501(a)(2) of the Illinois Marriage and Dissolution of Marriage Act, 750 ILCS 5/501(a)(2), either party in a marriage case may move for a preliminary injunction to enjoin a party from removing a child from the state of Illinois. A custodial parent who wishes to remove his or her minor children from the state must first obtain leave of court. 750 ILCS 5/609(a). Court approval is required even when the parties have previously consented to removal. The Court held that petitioner had demonstrated all necessary factors to prove his entitlement to an injunction. 

Link to Opinion 

 

In re Marriage of Mathis

Supreme Court Number: 113496

Appellate Court: Fourth District

Appellate Court Case Number: 4-11-0301

Issue Presented: In a bifurcated dissolution proceeding, when a grounds judgment has been entered, and when there is a lengthy delay between the date of entry of the grounds judgment and the hearing on ancillary issues, is the appropriate date for valuation of marital property the date of dissolution or a date as close as practicable to the date of trial of the ancillary issues?

Appellate Court Opinion Summary: In 2001, the trial court awarded the parties a judgment of dissolution, reserving a ruling on ancillary issues. In April 2004, the trial court commenced the hearing on ancillary issues. The petitioner filed a motion in limine to establish the valuation date of the marital property in November 2005. The court ultimately set the valuation date as January 1, 2006. In October 2010, respondent filed a motion to change the valuation date. After a hearing, the court set a new valuation date of December 31, 2010, but later certified the order pursuant to Supreme Court Rule 308. The Appellate Court affirmed, finding that property should be valued in a dissolution proceeding as of the date of trial on the property distribution matter, or as close thereto as practicable. 750 ILCS 5/503(f). The court declined to find either a patent or latent ambiguity in the language of the statute. Justice Appleton specially concurred, agreeing with the judgment but expressing his concern that the court's ruling will promote gamesmanship.

Link to Opinion

In re Marriage of McGrath

Supreme Court Number: 112792

Appellate Court: First District, Second Division

Appellate Court Case Number: 1-10-2119

Issue Presented: Are regular withdrawals from a savings account "income" within the meaning of the Illinois Marriage and Dissolution of Marriage Act, 750 ILCS 5/505, for application of the presumptive 28% child support obligation?

Appellate Court Opinion Summary: Petitioner sought child support and other relief. Respondent testified that he was currently unemployed and lived off the assets that were awarded to him as part of the marital estate, withdrawing about $8,500 per month from his savings account. The court ordered respondent to pay $2,000 per month in child support, and he appealed. The Appellate Court affirmed, holding that respondent's withdrawals constituted "income" within the meaning of the Illinois Marriage and Dissolution of Marriage Act, 750 ILCS 5/505, and therefore were subject to the presumptive 28% child support obligation. The Appellate Court further rejected respondent's argument that his "income" was limited to the interest from his savings accounts.

Link to Opinion

Karbin v. Karbin

Supreme Court Number: 112815

Appellate Court: First District, Sixth Division

Appellate Court Case Number: 1-10-1545

Issue Presented: May a guardian file and prosecute a petition for divorce his- or herself once a spouse's counterpetition has been dismissed, as opposed to one originated by the ward before incompetency?

Appellate Court Opinion Summary: Respondent wife suffered brain damage after a car accident. Although petitioner husband was guardian for a time, he eventually was forced to relinquish guardianship due to the onset of Parkinson's disease. After the transfer of authority, wife left Illinois with her daughter and new guardian. Husband filed a petition for dissolution of the marriage, and later, wife (through her guardian) filed a counterpetition. Husband eventually filed a voluntary request to dismiss his petition, which was granted, and moved to dismiss and strike his wife's petition - which was also granted. The trial court granted husband's request to dismiss, and dismissed the wife's petition as well.  The Appellate Court affirmed, holding that under In re Marriage of Drews, 115 Ill.2d 201, 203-04 (1986), a plenary guardian of a disabled adult lacks standing to maintain an action for the dissolution of a ward's marriage. The majority rejected a line of authority holding that such decisions could be made by the guardian only following a best interest hearing. Justice Cahill dissented, arguing that the case should be remanded to the trial court with instructions to determine whether the counterpetition was in the best interest of the ward.

Link to Opinion

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[UPDATED THROUGH May 14, 2012]

Carr v. Koch

Supreme Court Number: 113414

Appellate Court: Fourth District

Appellate Court Case Number: 4-11-0117

Issue Presented: Do plaintiffs have standing to challenge the Illinois education funding system as a violation of the equal protection clause of the Illinois constitution?

Appellate Court Opinion Summary: General state financial aid to schools is intended to supplement local resources devoted to public education. The State calculates what percentage of the Foundation Level a school can achieve without state aid. This is done by calculating a district's Available Local Resources - if that is less than 93% of the Foundation Level, the state provides financial aid sufficient to raise the district to that level. If Available Local Resources are 93-175% of the Foundation Level, the state provides aid on a sliding scale. If Available Local Resources exceed 175% of the Foundation level, the state provides a fixed grant. Plaintiffs filed suit, alleging that the state's education funding system required taxpayers in school districts with low property values to pay property taxes at a higher rate than similarly situated taxpayers in higher-property-value districts. Plaintiffs argued that the unequal treatment was not rationally related to any legitimate legislative purpose. According to plaintiffs, since the Supreme Court's decision in Committee for Educational Rights v. Edgar, 174 Ill.2d 1 (1996), the General Assembly has asserted effective state control over the core education functions in Illinois public schools. The trial court dismissed, holding that local variations in assessment rates could not be firmly traceable to the defendants, and that the action was barred by the State Lawsuit Immunity Act, 745 ILCS 5/0.01 et seq.   The Appellate Court affirmed, noting that individual school districts are free to impose higher or lower tax rates than those used to calculate Available Local Resources without any impact on their state funding; tax rates imposed by the local school districts are in no way obligated by the state funding scheme. Further, the court found that the requested relief -- a declaration that the state funding scheme was unconstitutional -- would not redress the plaintiffs' claimed injury because it would likely result in higher, not lower, tax rates in order to compensate for loss of state aid.

Link to Opinion

 

Hope Clinic for Women, Inc. v. Adams

Supreme Court Number: 112673 & 112704

Appellate Court: First District, Sixth Division

Appellate Court Case Number: 1-10-1463 & 1-10-1576

Issue Presented: Did the trial court properly dismiss an action challenging the constitutionality of the Illinois Parental Notice of Abortion Act, brought solely under state law, on the grounds that the plaintiffs' equal protection and due process claims were barred by collateral estoppel, and the plaintiffs' privacy claim was barred because Federal privacy law would require dismissal, and state privacy protections were interpreted in lockstep with Federal law?

Appellate Court Opinion Summary: Plaintiffs challenged the constitutionality of the Illinois Parental Notice of Abortion Act, 750 ILCS 70/1, under state law. The Act places on physicians the responsibility of disclosing to a parent, grandparent, stepparent living in the household or legal guardian the fact that his or her minor or incompetent child is seeking an abortion. No notice is required, on the other hand, when a minor child chooses to continue her pregnancy, even when she has been adjudicated incompetent, the pregnancy endangers her life or health, she is homeless, the resulting child will be severely disabled, or the minor seeks to give the child up for adoption. The Act contains no exception for rape or incest, unless it was committed by a parent, guardian, grandparent or stepparent living in the household. Nor is any exception provided if the minor's parent or guardian sexually or physically abused someone else in the minor's household. The plaintiffs alleged that the Act violated the state privacy clause, the due process clause, the equal protection clause, and the gender equality clause. The trial court dismissed the action with prejudice, finding that although plaintiffs had provided compelling evidence that parental notification would often expose minors to increased risks and anxieties, the claims were barred by various earlier decisions. The Appellate Court reversed. The Court held that the decision on which the lower court's finding of collateral estoppel was based, Zbaraz v. Hartigan,572 F.3d 370 (7th Cir. 2009), in fact resolved only a narrow facial due process challenge to the Act's judicial bypass provisions. Since the due process issue in Zbaraz was not identical to the plaintiffs' as-applied challenge, and since the equal protection claim there had not been adjudicated at all, the Court found that no collateral estoppel was raised. The Court next reversed the trial court's dismissal of the state privacy clause claim, finding that since Illinois has an express privacy clause, Federal constitutional law on privacy did not necessarily apply to Illinois-based claims, either with respect to the constitutionally guaranteed right to choose abortion or the right against disclosure of medical information. The Court also noted that where Federal privacy claims have been subjected to a variety of judicial review standards, Illinois law has a mandated standard for such claims -- reasonableness. Finally, the Court reversed the trial court's dismissal of the plaintiffs' gender equality claim, finding that the Act arguably discriminates based on gender in two ways: (1) by permitting minor males to make decisions endangering the life of a child without parental notification, but denying that right to minor females; and (2) by permitting minor females who were, or had ever been, married, to elect abortion without parental notification, while denying that right to minor females who had never been married. Justice McBride dissented only with respect to the reversal on the gender equality claim. Presiding Justice Garcia specially concurred with the result, but found that reversal was mandated on the substantially narrower grounds that the trial court had erroneously found its result to be mandated by earlier precedent.  

Link to Opinion

 

In re Torski C.

Supreme Court Case Number: 109623

Appellate Court: Fourth District

Appellate Court Case Number: 4-08-0952

Issue Presented: Is the definition of "dangerous conduct" found in the involuntary commitment statute void for vagueness?

Appellate Court Opinion Summary: Respondent was involuntarily committed to a mental health facility pursuant to Sections 1-104.5 and 1-119 of the Mental Health and Developmental Disabilities Code.  405 ILCS 5/1-104.5, 1-119.  Section 1-119 permits the involuntary commitment of any individual who is reasonably expected to engage in "dangerous conduct" which might include either threatening behavior or conduct that places the person or another in reasonable expectation of being harmed.  Section 1-104.5 defines "dangerous conduct" as including conduct placing another individual in "reasonable expectation of being harmed," or a person's inability to guard himself or herself from serious harm because of his or her inability to provide for his or her basic physical needs.  The Appellate Court held that the "reasonable expectation" language was unconstitutionally vague because it could be interpreted to apply to conduct that does not justify the deprivation of a liberty interest.  This was so because, as written, the statute arguably applied to "the entire gamut of psychological, emotional, or financial harm, regardless of severity," and because the statute "poses a risk of arbitrary application to mentally ill individuals engaging in merely unusual or annoying behavior."  The statutory definition for involuntary commitment was also problematic because -- inasmuch as the commitment standard was looser than the one applying to involuntary administration of psychotropic medications -- the statute created the possibility of an individual who could be admitted, but not treated.

Citations to Opinion: 395 Ill.App.3d 1010, 335 Ill.Dec. 405, 918 N.E.2d 1218

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[UPDATED THROUGH May 14, 2012]

Bonhomme v. St. James

Case Number: 112393 & 112398

Appellate Court: Second District

Appellate Court Case Number: 2-10-0036

Issues Presented: (1) Should the tort of fraudulent misrepresentation be extended to a largely personal setting on the facts pleaded? (2) Did the plaintiff plead justifiable reliance sufficient to reach a jury?

Appellate Court Opinion Summary:   Plaintiff alleged that defendant had impersonated a fictional male personality, as well as more than twenty equally fictional friends of the male personality, during an online relationship. Plaintiff sued defendant for intentional and negligent infliction of emotional distress, defamation per se and per quod, negligent defamation, fraudulent misrepresentation, and false light. The trial court dismissed all counts with prejudice except fraudulent misrepresentation, which was dismissed without prejudice. Plaintiff filed an amended complaint, purporting to reallege her claim for fraudulent misrepresentation, which the trial court then dismissed.  The Appellate Court held that plaintiff had abandoned all claims which she declined to reallege in her Third Amended Complaint. On appeal, the Appellate Court concluded that the facts presented an appropriate case for extending the tort of fraudulent misrepresentation beyond the commercial context, since the plaintiff alleged that she had sustained economic losses. The Court further found that on the facts pleaded, a jury could permissibly find that the plaintiff's reliance was justified. Justice Schostok dissented in part, arguing that the tort should not be expanded to the facts pleaded, and that the plaintiff could not prove justifiable reliance as a matter of law.

Link to Opinion

 

Choate v. Indiana Harbor Belt Railroad Co.

Supreme Court Number: 112948

Appellate Court: First District, First Division

Appellate Court Case Number: 1-10-0209

Issues Presented: (1) Does a defendant landowner have a duty of due care with respect to a nearly thirteen-year old injured while trying to jump aboard a slow-moving train on the landowner's tracks? (2) Was the expert opinion presented by plaintiff sufficient to support the jury's verdict on the grounds that improvements were reasonably practicable and would have prevented the accident? 

Appellate Court Opinion Summary: The minor plaintiff was injured while attempting to jump aboard a moving freight train traveling 9 to 10 miles per hour. The jury returned a verdict in favor plaintiff for $6.5 million, and held plaintiff 40% comparatively negligent. The Appellate Court affirmed. The Court noted that the question of whether a duty was owed to a landowner only if he "knows or should know that children frequent the premises and if the cause of the child's injury was a dangerous condition on the premises." There is both an objective and subjective test for determining whether a danger is obvious to a trespassing child. Under the objective test, a danger is obvious where children of similar age and experience would appreciate it. Under the subjective test, a danger is obvious where the child has some greater understanding of the alleged danger than would a typical minor of his age. The Court held that the question of whether the danger involved in the moving train was one which would be obvious to children of similar age and experience was one of fact for the jury. The Court further held that the evidence was sufficiently conflicting with respect to the subjective test to necessitate upholding the jury verdict. Viewed in the light most favorable to the plaintiff, the Court held that plaintiff's expert was sufficient for the jury to find that fencing would have prevented plaintiff from trying to jump aboard the moving train. Further, plaintiff's expert's analysis would not have required defendant to fence its entire right-of-way, nor were the proposed improvements prohibitively expensive. Finally, the Court rejected various evidentiary rulings by the Circuit Court.

Link to Opinion

 

Doe v. White

Supreme Court Number: 112479 & 112501

Appellate Court: Fourth District

Appellate Court Case Number: 4-10-0137 & 4-10-0138

Issue Presented: Did defendant school district and its various administrators owe a tort duty of care to protect students in a different district when they allegedly failed to report sexual abuse involving a school teacher, instead allegedly creating a falsely positive letter of recommendation for the perpetrator and falsifying a verification of teaching experience form to conceal the abuse?

Appellate Court Opinion Summary: Defendant teacher -- who was subsequently convicted of molesting students in two school districts -- was accused of sexually abusing the two minor plaintiffs. Plaintiffs alleged that prior to the alleged abuse, administrators in the first school district had learned of the teacher's conduct, and sought his resignation from their district. Plaintiffs alleged that: (1) no one at the first school district had reported teacher's abuse to the Illinois Department of Children and Family Services; (2) one of the individual administrators at the first district had created a falsely positive letter of recommendation for the teacher; (3) individual administrators at the first district had entered into a severance agreement with the teacher which concealed the abuse; (4) individual administrators had falsified information on the verification of teaching experience form submitted by the second district -- where plaintiffs were students -- to the first district; and (5) individual administrators at the first district had failed to inform the second district of the teacher's misconduct when the teacher sought a job with the second district. Plaintiffs sued both school districts and various administrators. At issue are plaintiffs' allegations against the teacher's original employer, the first school district, and its administrators: (1) willful and wanton misconduct, including failure to report the teacher's conduct to the state and instead "passing" him to the district where plaintiffs were students; (2) respondeat superior; (3) fraudulent concealment; (4) conspiracy; and (5) breach of fiduciary duties of trust. The trial court dismissed, finding that pursuant to the "public duty rule," defendants owed no duty to the plaintiffs, particularly since plaintiffs had never been students in the first district's schools. The court further found that no cause of action existed for "passing" of abusive teachers, and that plaintiffs' cause of action for fraud failed for lack of any pecuniary loss. Plaintiff entered an order pursuant to Supreme Court Rule 304, permitting interlocutory appeal. The Appellate Court reversed. The Court found that the public duty rule merely applied to allegations that government officials or employees had negligently performed their ordinary duties. Here, in contrast, the defendants allegedly engaged in intentional egregious conduct. Turning to Sections 324A and 311 of the Restatement (Second) of Torts, the Court held that the defendants had created a duty of care to plaintiffs through a voluntary undertaking by allegedly creating a false letter of recommendation for the teacher, and falsifying a verification of teaching experience form. The Court further noted that the Tort Immunity Act was not available to defendants in the action. Finally, the Court commented that the "state-created danger" doctrine -- which has not been recognized by any Illinois appellate court -- might be applicable. The state-created danger doctrine creates a constitutional duty to protect a person against injuries inflicted by a third party when the government affirmatively places the person in a position of danger he or she would not otherwise have faced, and does so through conduct which shocks the conscience.

Link to Opinion

Hernandez v. Bernstein

Supreme Court Number: 113054

Appellate Court: First District, Fifth Division

Appellate Court Case Number: 1-10-2646

Issues Presented: (1) Is an action for legal malpractice based on one factual theory one claim for purposes of res judicata, or two? (2) Does a plaintiff's voluntary dismissal of the remainder of his claim render the trial court's order dismissing one of plaintiff's factual theories final for purposes of res judicata?

Appellate Court Opinion Summary: Plaintiffs sued defendants for legal malpractice in connection with their representation of Jesse in connection with injuries he sustained at work. Plaintiffs alleged that defendants should have advised Jesse to sue various others, aside from his employer. The defendants moved to dismiss, arguing that the underlying third parties claims were already barred by the statute of limitations by the time defendants' representation began, and the trial court agreed, dismissing the claims without prejudice. Plaintiffs amended, alleging that defendants should have advised Jesse to sue his previous lawyers, and reasserting their previous time-barred claims. The trial court refused to dismiss, but in April 2009, the plaintiffs voluntarily dismissed their action without prejudice. Five months later, the plaintiffs refiled, reasserting their claims relating to the previous lawyers, and their time-barred claims. The trial court dismissed the claim with prejudice as barred by res judicata. The Appellate Court reversed. The plaintiffs claimed that they had alleged two separate negligence theories -- failure to sue third parties, and failure to sue the previous lawyers -- but the Appellate Court held that the plaintiffs had alleged a single claim for legal negligence. The Court found that dismissal of certain allegations under a single theory of recovery does not terminate litigation between the parties on the merits. The Court distinguished Hudson v. City of Chicago, 228 Ill.2d 462 (2008) and Rein v. David A. Noyes & Co., 172 Ill.2d 325, 334 (1996), holding that the plaintiffs' voluntary dismissal of their suit merely rendered all otherwise final orders appealable -- it did not render any nonfinal orders appealable.

Link to Opinion

 

Howell v. Dunaway

Supreme Court Case Numbers: 110199, 110200

Appellate Court: Fifth District

Appellate Court Case Number: 5-09-0071, 5-09-0072

Issue Presented: Is a hospital’s statutory lien for services, filed pursuant to the Health Care Services Lien Act, 770 ILCS 23/1, subject to a reduction under the common fund doctrine for attorney fees incurred by the injured plaintiff?

Appellate Court Opinion Summary: Both plaintiffs were injured in motor vehicle accidents, and sued the tortfeasors. The hospitals filed liens against any recovery pursuant to the Health Care Services Lien Act, 770 ILCS 23/1. After settling the personal injury actions, the plaintiffs filed petitions to adjudicate the liens, seeking to apply a one-third reduction in the amount of the liens to account for attorney fees incurred. The Circuit Court agreed with plaintiffs, applied the common fund reduction, and entered judgment, and the hospitals appealed. On appeal, the hospitals argued that the common fund rule was inapplicable to liens under the Act pursuant to the Supreme Court’s decision in Maynard v. Parker, 75 Ill.2d 73 (1979), on the grounds that plaintiffs’ debt to the hospitals was not dependent on the creation of the fund. The Appellate Court affirmed the judgment, holding that the Supreme Court had expanded the common fund rule to lienholder hospitals in a later decision, Bishop v. Burgard, 198 Ill.2d 495 (2002).

Citations to Opinion: 924 N.E.2d 1190, 338 Ill. Dec. 664

 

Lawlor v. North American Corporation of Illinois

Supreme Court Number: 112530

Appellate Court: First District, Fourth Division

Appellate Court Case Number: 1-09-3603

Issue Presented:

Appellate Court Opinion Summary: Plaintiff and her former employer filed cross-claims against each other. Defendant sued for breach of the duty of loyalty by attempting to steer business to a prospective employer, and unauthorized disclosure of confidential corporate sales information. Plaintiff sued for the "intrusion upon seclusion" tort. Both sides prevailed; employer recovered $78,781 in compensatory and $551,467 in punitive damages in a bench trial, and plaintiff recovered $1.75 million in punitive and $65,000 in compensatory damages in a jury trial. The parties cross-appealed. Defendant, the former employer, contended that it was not liable as the principal of the private investigator who had obtained plaintiff's private phone records. Plaintiff argued that the court had erroneously found in employer's favor on the breach of duty of loyalty claim, and had abused its discretion in reducing the award of punitive damages. Plaintiff was a commission-based salesperson for defendant from 1998 to 2005. Beginning in 2001, she signed an agreement providing that she would be compensated by 30% of gross profits generated for defendant. In late 2004 and early 2005, she met several times with a consultant about a potential new contract for her defendant. When defendant first pushed her aside from a lead role with that contract, and then attempted to change her compensation agreement, plaintiff resigned. In the months that followed, plaintiff became aware that she was being shadowed by investigators. After several months, she joined a new employer; she told no former clients where she was going, and none followed her from defendant to her new job. The Appellate Court affirmed the judgment for plaintiff with respect to intrusion upon seclusion, finding that defendant's attorneys had conceded that the private investigators were defendant's agents for purposes of respondeat superior, and that the evidence supported such a finding anyway. Next, the Court rejected defendant's argument that the award of $1.75 million in punitive damages was constitutionally excessive, finding that the trial court's order remitting much of the award was an abuse of discretion. The Court also held that the trial court's finding of a breach of the duty of loyalty was contrary to the weight of evidence, given that there was no evidence that plaintiff's departure had cost defendant any business at all, and there was no evidence that the information disclosed was, in fact, confidential.   

Link to Opinion 

 

Martin v. Keely & Sons, Inc.

Supreme Court Number: 113270

Appellate Court: Fifth District

Appellate Court Case Number: 5-10-0117

Issue Presented: Where the I-beam on a bridge the plaintiffs were constructing collapsed and fell, did the plaintiffs state a triable issue of fact on (1) the "relationship" prong of duty to preserve evidence, and (2) the "foreseeability" prong of the duty, meaning that a reasonable person would have foreseen that the beam was material to a potential civil action?

Appellate Court Opinion Summary: While installing a handrail on a bridge, plaintiffs were injured when they fell from scaffolding supported by an I-beam that collapsed and fell into Maxwell Creek near Sparta. After the accident was investigated by both IDOT and OSHA, defendant broke the concrete portion of the I-beam, and retrieved the steel plates for manufacture of a replacement. Plaintiffs sued for negligent manufacture, negligent design, and negligent destruction of evidence, and the manufacturer and designed counterclaimed against the employer for breach of duty to preserve the I-beam. The president of defendant cited three reasons for destroying the beam: (1) by reusing the steel ends, a new beam would be available sooner; (2) an IDOT representative had expressed concerns that if left in the creek, the beam might cause bridge scouring; and (3) neither IDOT nor OSHA had expressed criticism of the beam, making disposal just "a matter of cleaning up the mess." The circuit court entered summary judgment in defendant's favor on the spoliation of evidence claims. Noting that a duty to preserve evidence presupposes one of the enumerated instances set forth in Boyd v. Travelers Ins. Co., 166 Ill. 2d 188 (1995), the court held that none of the instances were present, and thus no duty existed. The Appellate Court reversed. The court held that the defendant had satisfied the first prong of the Boyd test for a duty to preserve, the "relationship" prong, by voluntarily preserving the beam for IDOT and OSHA. The court further held that the "foreseeability" prong of the test for duty to preserve -- whether a reasonable person should have foreseen that the evidence was material to a potential civil action -- represented a triable issue of fact, since eyewitnesses had heard a "pop" immediately before the beam snapped. Justice Spomer dissented, arguing that the defendants had not created a duty to preserve by merely allowing government agencies to inspect the beam. To extend the duty to preserve to such circumstances, according to Justice Spomer, amounting to finding a general duty to preserve evidence in Illinois.

Link to Opinion

 

Moore v. Chicago Park District

Supreme Court Number: 112788

Appellate Court: First District, Second Division

Appellate Court Case Number: 1-10-3325

Issue Presented: Does an unnatural accumulation of snow and ice constitute the 'existence of a condition of any public property' as this expression is used in Section 3-106 of the Tort Immunity Act?

Appellate Court Opinion Summary: Defendant's employee pushed snow to the curb in order to partially clear a parking lot. Plaintiff's decedent fell on the snow, breaking her leg. After undergoing an operation to repair the leg, decedent suffered brain damage and subsequently died. Plaintiff filed a two-count complaint for negligence - one count asserting a survivor's action, the second a claim for wrongful death. The defendant's motion for summary judgment was denied, and the defendant moved to certify two questions for interlocutory appeal. On appeal, the defendant asserted an affirmative defense under Section 3-106 of the Tort Immunity Act, which bars liability based on the existence of a condition of any public property used for recreational purposes. The Appellate Court affirmed, holding that snow and ice was not a "condition" under the Act. The Court emphasized that the parking lot and sidewalk themselves were not dangerous; they only became dangerous because of a Park District employee's negligent moving of the snow. The Court also found that the inherently temporary nature of snow and ice supported a conclusion that it was not a "condition" within the meaning of the statute. The Court declined to follow Callaghan v. Village of Clarendon Hills, 401 Ill.App.3d 287, 299-300 (2010), in which the Second District held that snow and ice are a "condition" under the statute. Justice Connors dissented, arguing that snow and ice were a "condition."

Link to Opinion

 

Toftoy v. Rosenwinkel

Supreme Court Number: 113569

Appellate Court: Second District

Appellate Court Case Number: 2-10-0565

Issue Presented: Does the Farm Nuisance Act, 740 ILCS 70/1, bar a nuisance suit where defendants started a cattle operation on property across from an unoccupied farmhouse, and several years later, plaintiffs demolished the farmhouse and constructed a new family home?

Appellate Court Opinion Summary: Defendants started a cattle operation in 1992 on a large parcel of farmland. The property across the street – part of a large parcel of farmland – contained a nineteenth century farmhouse, which was occupied by a family from 1986 through 1991, and vacant from 1992 to 1997. In 1998, the owner of the property gave a parcel to plaintiffs, and in 2004, plaintiffs moved into a new family residence built where the farmhouse had once stood. In 2007, plaintiffs filed suit, seeking a declaratory judgment and injunctive relief, alleging that defendants’ cattle operation created a nuisance as a result of excessive flies. Defendants’ theory of the case was that plaintiffs’ claim was barred by the Farm Nuisance Act, 740 ILCS 70/1, which provides that a farm cannot become a nuisance because of changed conditions in the surrounding land, so long as the farm has been in operation at least one year. The trial court held that plaintiffs’ construction of the new house did not constitute “changed conditions,” and entered a declaratory judgment in plaintiffs’ favor, and later an injunction. The Appellate Court affirmed, holding that defendants’ farm had not become a nuisance within the meaning of the statute because of the changed conditions – the new house constructed by plaintiffs. The Court affirmed the trial court’s findings regarding the claim of common law nuisance as well. However, the Court reversed the injunction, finding that there was no evidence in the record that the corrective measures ordered would in fact abate the nuisance. Justice Hutchinson dissented from the holding that the Act did not bar plaintiffs’ suit.

Link to Opinion

 

Wilson v. Edward Hospital

Supreme Court Number: 112898

Appellate Court: Second District

Appellate Court Case Number: 2-11-0085

Issue Presented: Are actual agency and apparent agency separate claims for purposes of the res judicata doctrine and the prohibition against claim-splitting set forth by the Supreme Court in Hudson v. City of Chicago, 228 Ill.2d 462 (2008) and Rein v. David A. Noyes & Co., 172 Ill.2d 325 (1996), so that summary judgment entered on the actual agency claims in plaintiffs’ initial suit bars plaintiffs’ apparent agency claims in a refiled suit, even in the face of a ruling that there is a question of fact as to the apparent agency claims?

Appellate Court Opinion Summary:  The then-minor plaintiff sustained an anoxic brain injury during surgery for a broken leg. He and his mother then sued the hospital, two doctors and their employers, and a nurse. The hospital filed a motion for partial summary judgment, arguing that the doctors were neither its actual or apparent agents. The trial court granted partial summary judgment on actual agency and denied the motion on apparent agency. Plaintiffs then moved to voluntarily dismiss their remaining claims pursuant to 735 ILCS 5/2-1009. Five months later, plaintiffs refiled their action, basing their claims against the hospital on apparent agency. The hospital moved for dismiss, arguing that the new complaint was barred by res judicata and the rule against claim splitting. The trial court denied the motion, but certified the question pursuant to Supreme Court Rule 308 of whether actual and apparent agency were separate claims for purposes of those doctrines. The Appellate Court held that the refiled claim was barred: where one of several legal theories upon which to hold a defendant negligent is adjudicated, the plaintiff must proceed on the others before appealing, or risk having any attempt to relitigate them later barred by res judicata. Justice Schostok specially concurred, agreeing that the result was dictated by precedent, but urging the Supreme Court to take up the question of how res judicata and the rule against claim-splitting apply to a voluntarily dismissed complaint.

Link to Opinion

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Appellate Strategist has organized the pending issues mentioned on The Texas Supreme Court's website according to subject matter for quick reference. We will update this information periodically, as new reviews are granted or opinions are issued. Hope it's useful.

• Alternative Dispute Resolution
• Commercial Law
• Constitutional Law
• Consumer Protection
• Contracts
• Employment
• Family Law
• Government Immunity
• Healthcare
• Insurance
• Intentional Torts
• Judicial Administration
• Jurisdiction
• Juvenile Law
• Local Government
• Negligence
• Other Issues
• Products Liability
• Public Utilities
• Punitive Damages

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[UPDATED THROUGH May 14, 2012]

Brooker v. Madigan

Supreme Court Case Number: 108244

Appellate Court: First District, Division 1

Appellate Court Case Number: 1-07-1876

Issue Presented: Does language of the Illinois Estate and Generation-Skipping Transfer Tax Act, defining an estate's tax liability as the maximum credit "allowed" pursuant to an earlier version of Federal law, permit the estate to avoid state estate taxes by claiming no credit on its Federal return?

Link to Oral Argument audio

Appellate Court Opinion Summary:  As part of a 2001 statute gradually eliminating Federal estate taxes, Congress began phasing out a credit allowed on federal returns for state taxes. Illinois responded by setting the amount of estate tax due as the full credit which would have been computed and allowed under the previous version of Federal law. Decedent died not long after her parents. Decedent's Federal estate tax return claimed no credit for state taxes paid upon the death of her parents because other factors had nearly eliminated any liability. The Circuit Court held that since the estate had claimed no state tax credit on its federal return, the language of the Illinois statute meant no state tax was due. The Appellate Court reversed, holding that the tax due was the maximum credit which could have been claimed. 

Citations to Opinion:       388 Ill.App.3d 410, 327 Ill. Dec. 860, 902 N.E.2d 1246

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[UPDATED THROUGH May 14, 2012]

Rush University Medical Center v. Sessions

Supreme Court Numbers: 112906 & 112993

Appellate Court: First District, Sixth Division

Appellate Court Case Number: 1-10-1136

Issue Presented: Does the doctrine holding that self-settled spendthrift thrusts are revocable per se survive the enactment of the Fraudulent Transfer Act?

Appellate Court Opinion Summary: Defendants' decedent created a Family Trust. In 1995, he made an irrevocable pledge to plaintiff. Following his cancer diagnosis, decedent executed a Revocable Living Trust and then a new will. Before his death, he made no payments on the gift to plaintiff. Plaintiff filed a claim against the decedent's estate, but the estate was insufficient to satisfy the pledge. Therefore, plaintiff filed supplemental claims against two of decedent's trusts. Count I was brought under the Uniform Fraudulent Transfer Act. Count II was for breach of contract, and Count III alleged that decedent's transfer of assets was per se fraudulent under Crane v. Illinois Merchants Trust Co., 238 Ill.App. 257 (1925) and Barash v. McReady (In re Morris), 151 B.R. 900, 906-07 (Bankr C. D. Ill. 1993). The trusts filed motions for summary judgment on counts II and III, and plaintiff filed a cross-motion on count II. The Circuit Court granted summary judgment to plaintiff on count II, the breach of contract claim, and denied the trusts' cross-motions on counts II and III. The trusts' motion to substitute judge for cause was denied. Plaintiff then sought summary judgment on count III, the fraud per se claim. The Appellate Court affirmed with respect to the appeal on the challenge for cause, holding that opinions formed by the judge on the basis of facts introduced or events occurring during the proceeding were not grounds for a finding of bias. With respect to count III, the court held that earlier precedents holding that self-settled spendthrift trusts were fraudulent and per se void did not survive the enactment of the Fraudulent Transfer Act, 740 ILCS 160/5(a)(1), (a)(2).

Link to Opinion

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[UPDATED THROUGH May 14, 2012]

Vincent v. Alden Park Strathmoor, Inc.

Supreme Court Case Number: 110406

Appellate Court: Second District

Appellate Court Case Number: 2-09-0625

Issue Presented: Does a claim for common law punitive damages pursuant to the Nursing Home Care Act survive the death of the nursing home patient?

Appellate Court Opinion Summary: Plaintiff sued as the legal representative of the estate of a deceased nursing home patient, seeking compensatory damages under the Nursing Home Care Act. In his complaint, plaintiff expressly reserved the right to seek an award of common law punitive damages. Defendant moved to strike the reservation on the grounds that any claim for punitive damages did not survive the decedent's death. The trial court granted the motion to strike and certified the survival issue for interlocutory appeal. The Appellate Court reversed. The Court found that there was no specific statutory authority for such an award. The plaintiff also argued that equitable considerations weighed in favor of survival, but the Court held that even if such an exception existed, equitable considerations did not support permitting survival in the case before it.

Citation to Opinion: 399 Ill.App.3d 1102, 928 N.E. 2d 115, 340 Ill. Dec. 396

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[UPDATED THROUGH May 14, 2012] 

Center Partners, Ltd. v. Growth Head GP, LLC

Supreme Court Number: 113107 & 113128

Appellate Court: First District, Second Division

Appellate Court Case Number: 1-11-0381

Issues Presented: Does the doctrine of subject matter waiver for the attorney-client privilege extend from litigation to business negotiations? Can documents shared among partners in a business negotiation be protected by the work product privilege?

Appellate Court Opinion Summary: Plaintiffs were minority limited partners in a partnership acquired by defendants. Plaintiff sued defendants, alleging breach of fiduciary and contractual duties related to defendants' purchase of the ultimate parent of their partnership. Defendants acknowledged that during the negotiations leading to the purchase of the target company, they shared legal advice from their attorneys regarding the purchase. Plaintiffs moved to compel production of attorney-client communications disclosed among the defendants during the purchase negotiations; later, they moved to compel production of all communications, whether or not disclosed among the defendants. The Circuit Court granted the motion to compel, and when defendants declined to comply in order to create standing to appeal, the court held defendants in "friendly contempt." The Appellate Court held that defendants' sharing of all communications relating to the purchase of the target company affected a subject-matter waiver, extending the doctrine of subject matter waiver from litigation to a business negotiation. The Appellate Court also rejected defendants' argument that a subset of the documents was protected by the work product privilege on the grounds that the documents were not prepared in preparation for trial or litigation. 

Link to Opinion

 

 

Cooney v. Rossiter

Supreme Court Number: 113227

Appellate Court: First District, Fifth Division

Appellate Court Case Number: 1-10-2129

Issue Presented: (1) Was the plaintiffs' action barred pursuant to res judicata by the earlier Federal action, even though the earlier Federal action was a class, rather than an individual claim? (2) Did a court-appointed psychological evaluator in a custody hearing have absolute immunity from suit for alleged misconduct in connection with his opinions?

Appellate Court Opinion Summary: Defendant, a general and forensic psychiatrist, was appointed by the trial court as the evaluator pursuant to 750 ILCS 5/605 of the best custodial arrangements for the children, in response to former husband's petition for change of custody. Defendant opined that plaintiff and her parents suffered from Munchausen's by proxy syndrome, and that the minor children should be removed from the home by reason of child abuse. Plaintiffs sued defendant in Federal court, purporting to allege causes of action under Section 1983. The action was dismissed, and the dismissal was affirmed by the Seventh Circuit. Plaintiffs then sued defendant in state court for infliction of emotional distress and outrageous conduct. The trial court dismissed the action, holding that the action was barred by res judicata, and because defendant had absolute immunity from suit. The Appellate Court affirmed, finding that the previous Federal judgment was res judicata, and defendants were absolutely immune from suit.

Link to Opinion

 

 

Downtown Disposal Services, Inc. v. The City of Chicago

Supreme Court Case Number: 112040

Appellate Court: First District, Division Four

Appellate Court Case Number: 1-10-0598

Issue Presented: Must a corporation's complaint be automatically dismissed where it is signed and filed by a non-attorney, contrary to 735 ILCS 5/2-619(a)(9), or does the Circuit Court have discretion to decide whether dismissal would serve the purposes of the nullity rule?

Appellate Court Opinion Summary: Between 2007 and 2008, the city Department of Transportation issued appellant four administrative notices for violating City ordinances pertaining to dumpsters. When appellant failed to appear, the Department of Administrative Hearings issued default judgments. Subsequently, appellant's president filed motions to set aside the default judgments for lack of notice. The administrative law officer denied relief, and the appellant's president signed and filed four fill-in-the-blank pro se complaints for administrative review in the Circuit Court. The City moved to dismiss the complaints pursuant to 735 ILCS 5/2-619(a)(9), arguing that the appellant was a corporation and its complaints were impermissibly filed by the corporate president, who was not a licensed attorney. Appellant filed motions for leave to file amended complaints signed by a licensed attorney, arguing that this cured a merely technical defect in the original filings. The Circuit Court dismissed, denying the motions for leave to amend, on the grounds that dismissal was automatic under the "nullity rule" -- filings by an unlicensed person purporting to represent a corporation are null and void. The Appellate Court reversed. Based in part upon the Supreme Court's description of the nullity rule in Applebaum v. Rush University Medical Center, 231 Ill.2d 429 (2008), the court held that the application of the nullity rule was not automatic; rather "courts must consider whether under the specific facts presented, application of the rule would serve its purposes." The Court concluded that no purpose would be served by applying the nullity rule on the facts presented. 

Appellate Court Opinion

 

EMC Mortgage Corp. v. Kemp

Supreme Court Number: 113419

Appellate Court: Second District

Appellate Court Case Number: 2-10-1175

Issues Presented: (1) Is a judgment of foreclosure final and appealable, or must an appeal await a final order approving the sale and distributing the proceeds? (2) Is an order of foreclosure immediately appealable when standing is challenged on the grounds that the order is void?

Appellate Court Opinion Summary: Plaintiff filed a foreclosure complaint. Defendant answered, denying plaintiff's standing, and counterclaimed, alleging that a third party had acted as the mortgage lender. Plaintiff's motion to dismiss the counterclaim was granted. Defendant filed a further counterclaim for slander of title, and the trial court granted plaintiff's motion to dismiss. The trial court entered a judgment of foreclosure; the trial court moved for reconsideration, and the motion was denied. The court subsequently granted a motion to stay the judgment of foreclosure based on defendant's argument that plaintiff lacked standing. The court subsequently dissolved the stay and denied the motion to dismiss and/or vacate. The Appellate Court dismissed the appeal for lack of jurisdiction, holding that a judgment of foreclosure was non-final without a finding pursuant to Rule 304(a) -- which the order under appeal specifically disavowed. The Court further rejected defendant's argument that the order of foreclosure was immediately appealable on the grounds that it was void, because lack of standing did not render an order void.

Link to Opinion

 

 

Fennell v. Illinois Central Railroad Company

Supreme Court Number: 113812

Appellate Court: Fifth District

Appellate Court Case Number: 5-10-0504

Issue Presented: Did the trial court err by denying defendant's motion for dismissal pursuant to forum non conveniens of an asbestos injury claim brought by a non-resident of Illinois?

Appellate Court Opinion Summary: Plaintiff filed suit in Pike County, Mississippi, alleging that he suffered from respiratory ailments as a result of exposure to asbestos while working for defendant. The Mississippi court dismissed without prejudice. Seven years later, plaintiff filed suit in St. Clair County, Illinois under the Federal Employers' Liability Act and the Locomotive Boiler Inspection Act. The defendant moved to dismiss based on forum non conveniens, arguing that trial in the plaintiff's home county of Copiah County, Mississippi would be more convenient. The trial court denied the motion, finding that (1) substantial evidence was located near the St. Clair County venue; (2) key witnesses could be compelled in Illinois, but not in Mississippi; (3) St. Clair County was more convenient for plaintiff's expert witnesses; and (4) the citizens of St. Clair County had an interest in asbestos litigation involving railcars traveling through the county.   The Appellate Court affirmed.  Applying the multi-factor public and private interest test, the court found that plaintiff had failed to prove that the plaintiff's choice of forum was inconvenient to it. The court further found that the relative ease of access to witnesses did not favor defendant, since the principal Mississippi-based witnesses were plaintiff's, not defendant's. Further, the court found that documentary evidence relevant to the foreseeability of plaintiff's injuries was in the Belleville offices of the defendant's law firm. The court found that the first public interest factor -- the fairness of burdening residents of either locale with the expense of trial or the burden of jury duty -- weighed slightly in favor of the Mississippi forum, since plaintiff's exposure had taken place there. Finally, the court found that the Illinois forum's docket was not substantially overburdened in comparison to the Mississippi forum's docket. Balancing all the factors, the court found that the defendant had not demonstrated that trial in the Mississippi forum was substantially more convenient. Justice Welch dissented, arguing that the action had no nexus to Illinois, let alone to St. Clair County.

Link to Opinion

 

 

 

Khan v. BDO Seidman, LLP

Supreme Court Number: 112219, 112221 & 112223

Appellate Court: Fourth District

Appellate Court Case Number: 4-10-0504, 4-10-0583

Issues Presented: (1) Were the investment bank defendants the fiduciaries of their clients, as a matter of law and fact, with respect to their recommendations regarding certain "investment strategies" alleged to hold tax benefits? (2) Did the plaintiffs' claims accrue prior to the entry of IRS assessments against them with respect to the disputed investments? (3) Does the clause of 735 ILCS 5/13-214.2(b), the statute of repose relating to tax professionals, providing for the last date on which a claim for professional negligence may be brought when an IRS tax assessment has been entered lengthen the statutory period of repose? 

Appellate Court Opinion Summary: Plaintiffs sued the investment bank group of plaintiffs, alleging that they had advised plaintiffs to enter into certain "investment strategies," partially for tax purposes, which instead led to an IRS audit and substantial back taxes and penalties. Plaintiffs also sued the accountant defendants, alleging that they had negligently prepared the tax returns involved. The trial court dismissed all claims, concluding that the claims against the investment bank defendants were barred by the statute of limitations, and those against the accountant defendants were barred both by the statute of limitations and by the statute of repose. The Appellate Court reversed, finding that plaintiffs had adequately alleged breach of fiduciary duty against the investment bank defendants both as a matter of fact and as a matter of law. The Court further held that certain contractual disclaimers were voidable for lack of sufficient disclosure of material facts. The Court further found that plaintiffs' negligent misrepresentation claim against the investment bank defendants was legally sufficient, and that no claims were time barred because the claim did not accrue, as a matter of law, until the IRS assessment following the audit was entered. The Court held that the claims against the accountant defendants were timely on the same grounds, finding that the payment of the accountant's fees for preparing the subject returns were at most a contingent harm, rather than an actual harm sufficient to cause the claim to accrue, until the assessment was entered. Finally, the Court held that the malpractice claim was not barred by the statute of repose found at 735 ILCS 5/13-214.2(b) because the plaintiffs had actually been subject to an income tax assessment, lengthening the statutory period pursuant to the plain language of the statute.

Link to Opinion

 

 

 

Magnetek v. Kirkland & Ellis, LLP

Supreme Court Case Number: 112910

Appellate Court: First District, Second Division

Appellate Court Case Number: 1-10-1067

Issue Presented: Does a claim for legal malpractice in a patent infringement suit fall under exclusive Federal patent jurisdiction where the claim rests upon certain defenses which were found in a subsequent suit involving another party to render the underlying patent unenforceable?

Appellate Court Opinion Summary: Defendant represented plaintiff in a patent infringement suit. The parties agreed to arbitrate the matter, and the arbitrator awarded the suing inventor damages for infringement. Subsequently, the plaintiff moved to vacate the arbitrator's award based on fraud in obtaining the underlying patent, but the motion was denied. In a subsequent infringement case involving the inventor and an unrelated third party, the patent at issue was declared unenforceable, largely upon the grounds urged in the plaintiff's motion to vacate. Plaintiff sued defendant for malpractice, alleging that defendant was negligent in not finding the evidence of invalidity soon enough for it to be raised in the underlying infringement action. The trial court granted defendant's motion to dismiss, finding that in order to establish the proximate cause element of the malpractice claim, plaintiff would have to prove that but for defendant's alleged negligence, it would have prevailed in the infringement action -- a substantial question of Federal patent law. The Appellate Court pointed out that under Federal law, a finding of patent invalidity in one action could be used by future litigants against the patent holder pursuant to collateral estoppel. Accordingly, the Court found that because the patent at issue had been found invalid in a later suit, largely upon the grounds urged by the plaintiff here, no disputed question of Federal patent law was at issue in the malpractice claim. Since it would be unnecessary to answer any substantial and disputed question of Federal patent law in order to adjudicate the malpractice claim, the Appellate Court reversed the trial court, finding that the state courts had subject matter jurisdiction over the malpractice claim.

Link to Opinion

 

 

 

Mashal v. The City of Chicago

Supreme Court Number: 112341

Appellate Court: First District, Sixth Division

Appellate Court Case Number: 1-09-2484

Issues Presented: (1) What is a 'decision on the merits' under 735 ILCS 5/2-802 that would preclude the entry of a class decertification order? (2) Whether, in a class action case challenging defendants' practice of issuing parking or standing violations to taxicab drivers and others by mail and without any personal service on the driver or placement of the citation on the offending vehicle, a prior Judge's ruling that the defendants' 'practice of sending a second notice of a parking or standing violation prior to an initial notice being either hand delivered to the driver of the vehicle or affixed to the vehicle is violative of the plain language of the statute and the ordinances' constitutes a decision on the merits under section 2-802 of the Code such that a subsequent judge presiding in the case lacks the authority to decertify the class? (3) Whether, in a class action case challenging defendants' practice of issuing parking or standing violations to taxicab drivers and others by mail and without any personal service on the driver or placement of the citation on the offending vehicle, a prior Judge's ruling that denied the defendants' motion for partial summary judgment on the application of their affirmative defenses of failure to exhaust administrative remedies, res judicata, the collateral attack doctrine, and the voluntary payment doctrine constitutes a decision on the merits under section 2-802 such that a subsequent Judge presiding in the case lacks the authority to decertify the class? (4) Whether, in a class action case challenging defendants' practice of issuing parking or standing violations to taxicab drivers and others by mail and without any personal service on the driver or placement of the citation on the offending vehicle, a Judge's ruling that granted in part the defendants' motion for summary judgment on the application of the statute of limitations constitutes a decision on the merits under section 2-802 such that a subsequent Judge presiding in the case lacks the authority to decertify the class.

Appellate Court Opinion Summary: Plaintiff sued the city, challenging the practice of issuing "fly-by" traffic citations to taxicab drivers and others -- citations received by mail, without personal service on the driver or placement on the offending vehicle -- pursuant to the Illinois Vehicle Code and the Municipal Code. The court granted the plaintiff's motion for partial summary judgment, agreeing that the practice was unlawful. After the first judge retired, a second judge adjudicated the City's motion for partial summary judgment, holding that all claims accruing before the statute were barred. Some time later, the court granted the City's motion to decertify the class. Subsequently, the Supreme Court entered a supervisory order directing the circuit court to certify the four questions set forth above for appeal. With respect to the first question, the Court held that a complete determination of liability on a claim based on facts disclosed by the evidence was necessary to amount to a "decision on the merits." The Court found that prohibiting decertification only once liability has been completely determined serves the purposes of decertification by avoiding inefficiency and waste of resources. With respect to the second question, the Court held that the prior decision did not bar decertification because it was not a complete resolution of the merits. With respect to the third question, the Court held that the court's power to order decertification was not lost, because although the court's order on failure to exhaust remedies barred certain affirmative defenses, it did not affect the defendants' ability to defend each of the claims on the merits. Finally, with respect to the fourth question, the Court held that the trial court's decision to dismiss some parties was not a final resolution of the merits either.

Link to Opinion

 

 

Palm v. 2800 Lake Shore Drive Condominium Association

Supreme Court Case Number: 110505

Appellate Court: First District, Division 5

Appellate Court Case Number: 1-08-2436

Issue Presented: Are the provisions of the Chicago Condominium Ordinance giving the right to compel production of documents, and authorizing interim awards of attorneys' fees, preempted by purportedly conflicting state law?

Appellate Court Opinion Summary: Plaintiff requested access to certain condominium association records, alleging various improprieties and deviations from association bylaws. When the association denied plaintiff's request, plaintiff filed suit, seeking an order compelling production. The trial court entered summary judgment in plaintiff's favor and ordered production. Subsequently, the court entered an order granting plaintiff interim attorneys fees. On appeal, the association argued that the Chicago Condominium Ordinance upon which plaintiff based his demand for production was preempted by state law, which provided a different standard for compelling production of documents. The Appellate Court disagreed, holding that the legislature must expressly state its intent to preempt home rule powers in order for state law to trump ordinances in home rule jurisdictions. The Court declined to follow the Second District's decision in Oakbrook Terrace v. Suburban Bank & Trust Co., 364 Ill.App.3d 506. Similarly, the Court held that the provision in Chicago's Condominium Ordinance authorizing an award of interim attorneys' fees was valid and enforceable, since it was not expressly preempted by state law.

Citation to Opinion: 401 Ill. App.3d 868, 929 N.E.2d 641, 340 Ill. Dec. 990

 

Santiago v. E.W. Bliss Company

Supreme Court Case Number: 111792

Appellate Court: First District, Second Division

Appellate Court Case Number: 1-10-0796, 1-10-0780

Issues Presented: When an injured plaintiff intentionally files a complaint using a fictitious name, without leave of court as provided in 735 ILCS 5/2-401, and subsequent to the expiration of the statute of limitations, files an amended complaint with the correct plaintiff’s name, should the court dismiss with prejudice as a sanction, or because the limitations period has expired and the amended complaint does not relate back to the original filing?

Appellate Court Opinion Summary: Plaintiff filed a tort action alleging injuries sustained while using a punch press. The complaint identified the plaintiff by what would later prove to be a fictitious name, and did not disclose that the plaintiff had ever been known by any other name. Plaintiff filed a First Amended Complaint, and later verified interrogatory answers, under the false name. After plaintiff disclosed his real name during deposition, plaintiff was given leave to file a Second Amended Complaint substituting his real name, but defendants then moved to dismiss as a sanction for committing a fraud on the court, or because the statute of limitations had run and the new complaint did not “relate back.” The Appellate Court affirmed. The Court found that while the misconduct at issue did not warrant the use of the contempt power, sanctions could be justified either for violation of Supreme Court Rule 137 or Supreme Court Rule 213, or under the court’s inherent authority to control its docket. The Court held that although dismissal is not a mandatory sanction under the circumstances, it is a permissible one, subject to the sound discretion of the trial court. Finally, because the original complaint was a nullity, the Court held that the second complaint could not relate back to it for statute of limitations purposes, and therefore, the action could be dismissed pursuant to the statute of limitations.

Appellate Court Opinion

 

State Bank of Cherry v. CGB Enterprises, Inc.

Supreme Court Number: 113836

Appellate Court: Third District

Appellate Court Case Number: 3-10-0495

Issues Presented: (1) Does the Federal Food Security Act of 1985, 7 U.S.C. § 1631(e), preempt the state UCC for purposes of security interests on crops? (2) If so, does the Act require strict or substantial compliance in order to effectively attach a security interest when crops are sold?

Appellate Court Opinion Summary: A third party executed a note in plaintiff's favor, using certain crops as security. He later sold those crops to defendant. Plaintiff allegedly gave defendant notice of its security interest pursuant to 7 U.S.C. § 1631(e), the Food Security Act of 1985. Plaintiff filed suit, alleging that defendant had failed to protect plaintiff's security interest in the crops. Plaintiff filed a motion for summary judgment, and defendant filed a cross-motion for judgment on the pleadings, arguing that plaintiff's notices failed to strictly comply with 7 U.S.C. § 1631(e). Plaintiff responded that its notices were sufficient under sections 9-320(f) and 9-320.1 of the Uniform Commercial Code, 810 ILCS 5/9-320(f), 9-320.1, as interpreted by the court in First National Bank v. Effingham-Clay Service Co., 261 Ill.App.3d 890 (1994). The Circuit Court granted plaintiff's motion for summary judgment, and denied defendant's motion for judgment on the pleadings. The Appellate Court reversed, holding that the Food Security Act was intended to supplant state law such as the UCC on the same subject. The Court followed the decision of the Eighth Circuit in Farm Credit Midsouth, PCA v. Farm Fresh Catfish Co., 371 F.3d 450 (8th Cir. 2004), holding that Section 1631(e) of the Food Security Act required strict compliance, and defendant had therefore purchased the crops free of plaintiff's security interest. Justice Holdridge dissented, arguing that the Food Security Act requires only substantial compliance.

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[UPDATED THROUGH May 14, 2012] 

Carter v. SSC Odin Operating Co.

Supreme Court Number: 113204

Appellate Court: Fifth District

Appellate Court Case Number: 5-07-0392

Issues Presented: (1) Is an agreement mandating arbitration of all claims for more than $200,000 arising out of nursing home claims void for lack of mutuality on the grounds it is illusory? (2) Is an agreement to arbitrate applicable to a wrongful death claim where plaintiff signed the agreement only in the status of decedent's "legal representative"?

Appellate Court Opinion Summary: Plaintiff, as administrator to decedent, sued defendant, alleging that it had negligently provided nursing home services to decedent, resulting in injuries to decedent and her death. The defendant moved to compel arbitration; the circuit court denied the motion; the Appellate Court affirmed; but the Supreme Court reversed. The matter then returned to the Appellate Court for consideration of further matters not previously addressed. The complaints alleged two claims, one for statutory survival, and one for wrongful death. On remand from the Supreme Court, the Appellate Court first held that the arbitration agreements evidenced transactions involving interstate commerce. Second, the Court held that the arbitration agreements were illusory and thus unenforceable on the grounds that, since they applied only to claims for more than $200,000, they could only apply to the decedent's claims for negligent care, not to defendant's claims for unpaid bills. Finally, the Court held that the wrongful death claims were not arbitrable, since plaintiff's signature on an arbitration agreement was designated as decedent's "legal representative," while the wrongful death claim belonged to plaintiff personally. Justice Spomer dissented in part, concluding that the contracts were not void for lack of mutuality.

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[UPDATED THROUGH May 14, 2012]

Country Preferred Insurance Co. v. Whitehead

Supreme Court Number: 113365

Appellate Court: Third District

Appellate Court Case Number: 3-11-0096

Issue Presented: Is the provision of an Illinois automobile insurance policy imposing a two-year statute of limitations on uninsured motorists claims invalid as against public policy with respect to an accident which occurred in Wisconsin, where the statute of limitations for uninsured motorist claims is three years?

Appellate Court Opinion Summary: Defendant was in an automobile accident in Wisconsin with an uninsured motorist. As required by Illinois law, defendant's policy provided that the insured could make a written demand for arbitration of any claim involving an uninsured motorist, and any such suit was barred two years after the accident. Plaintiff filed a declaratory judgment action, alleging that her uninsured motorist claim was barred on the grounds that she failed to make a written demand for arbitration within two years. The trial court denied defendant's motion to compel arbitration, but the Appellate Court reversed. The public policy of Illinois is to place the injured party in an uninsured motorist accident in substantially the same position he would have occupied if the uninsured driver had been insured. Hoglund v. State Farm Mutual Automobile Ins. Co., 148 Ill.2d 272, 279 (1992). Thus, the question was whether public policy was violated when an insurance policy limited coverage to two years with respect to an accident which occurred in a state where the statute of limitations was three years. The Appellate Court held that the policy provision violated public policy because it altered the rule which would have applied if the uninsured motorist involved in the accident had been insured. Justice McDade dissented, arguing that the laws of another state could not amend or otherwise affect Illinois public policy. 

Link to Opinion

 

Steadfast Insurance Co. v. Caremark RX, Inc.

Supreme Court Case Number: 104906

Appellate Court: First District, Division 2

Appellate Court Case Number: 1-06-1221

Issues Presented: (1) Where an insurer pays its insured's defense costs solely in order to comply with a trial court order, may the insurer seek reimbursement of those payments when the order finding a duty to defend is reversed?  (2) Did the Circuit Court abuse its discretion by permitting the insurer to amend its complaint for declaratory judgment after the order on duty to defend is reversed to state a claim for unjust enrichment?

Appellate Court Opinion Summary: The insurer's insured was sued for allegedly conspiring to obtain undisclosed discounts, rebates and kickbacks for favoring certain drugs.  Insurer denied a defense and filed a declaratory judgment action.  The Circuit Court granted the insured's motion for summary judgment, ordered insurer to provide a defense, and refused to stay enforcement of its order pending review.  The Appellate Court reversed, holding that insurer had no duty to defend.  On remand, insurer filed a motion for restitution, seeking to recover defense costs expended between entry of the trial court's order and reversal.  The Circuit Court held that the insurer's declaratory judgment action was the "functional equivalent" of a defense on reservation of rights, and the insurer was therefore barred from recovering defense costs under General Agents Ins. Co. of Am. v. Midwest Sporting Goods Co., 215 Ill.2d 146 (2005).  The Appellate Court affirmed the Circuit Court's denial of the motion for restitution, finding that although the motion was not governed by General Agents, insurer had not stated any cause of action which could support a remedy of restitution.  However, the Appellate Court reversed the Circuit Court's refusal to permit the insurer to amend to state a claim for unjust enrichment.

Citations to Opinion: 373 Ill.App.3d 895, 311 Ill.Dec. 897, 869 N.E.2d 910

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[UPDATED THROUGH May 14, 2012] 

Ferguson v. Georges

Case Number: 112488

Appellate Court: First District, Sixth Division

Appellate Court Case Number: 1-10-1152

Issues Presented: (1) Does Section 2-56-040 of the Chicago Municipal Code authorize the Inspector General of the City of Chicago to hire private counsel to enforce subpoenas? (2) May the Inspector General sue the Corporation Counsel of Chicago to enforce subpoenas?

Appellate Court Opinion Summary: The Inspector General of the City of Chicago served the Corporation Counsel for the city with a subpoena for unredacted documents as part of an investigation into an employee's receipt of a sole-source contract arguably in violation of the City's ethics and contracting rules. When the Corporation Counsel refused to comply, the Inspector General retained private counsel and sued. The trial court dismissed on the grounds that the Inspector General lacked the authority to retain private counsel, and the documents were protected by the attorney-client privilege. The Appellate Court reversed, finding that Section 2-56-040 of the Chicago Municipal Code, which implies that the Inspector General may take action to enforce subpoenas, necessarily implies the power to employ private counsel to enforce the IG's subpoenas when directed against the Corporation Counsel. The Appellate Court remanded the matter to the trial court for further consideration, on a document by document basis, of the possible applicability of the attorney-client privilege. Justice Cahill dissented from the majority's ruling that the plaintiff had the power to enforce its subpoena in court, including by hiring private counsel.

Link to Opinion

 

Harris v. Thompson

Case Number: 112350

Appellate Court: Fifth District

Appellate Court Case Number: 05-09-0625

Issue Presented: Does the Local Governmental and Governmental Employees Tort Immunity Act, 625 ILCS 5/1-100, which limits the potential liability of government employees to willful and wanton behavior, or the Illinois Vehicle Code, which regulates the conduct of a driver of an ambulance, whether employed by a public or private employer, whenever using audible or visual signals, govern the conduct of a publicly employed ambulance driver?

Appellate Court Opinion Summary:  Plaintiffs filed suit against defendants to recover for injuries sustained in a collision between their vehicle and the ambulance driven by defendant Thompson. The parties disagreed about the speed at which the ambulance was traveling at the time of the collision, Thompson alleging that the ambulance was traveling at 10 miles per hour, and one of the plaintiffs claiming that the vehicle was traveling at more than 40 miles per hour. Defendant Massac County Hospital District sought dismissal on the grounds that it was immune from liability pursuant to the Local Governmental and Governmental Employees Tort Immunity Act, 745 ILCS 10/1-101, which limits liability to willful and wanton conduct. The plaintiff then added a willful-and-wanton count, on which the trial court later directed a verdict. The case went to trial on the negligence claim, and judgment was against the defendants, who appealed. The principal issue on appeal was a perceived conflict between the Local Governmental and Governmental Employees Tort Immunity Act , which limits immunity to willful and wanton conduct, and the Illinois Vehicle Code, 625 ILCS 5/1-100, which regulates the conduct of a driver of a public or privately owned emergency vehicle using audible or visual signals. The Appellate Court analyzed various decisions, some of which held that the Vehicle Code governed with respect to the conflict versus others which reached the opposite conclusion. The Appellate Court held that the Vehicle Code's standard governed on the grounds that the statute was the more recently enacted standard, and suggested that the Supreme Court should address the conflict.

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