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On December 10th, CCL filed an amicus curiae brief on behalf of the American Association for Justice (AAJ) supporting a federal district court judge’s authority to sanction lawyers for improper tactics and behavior. The brief, filed in the United States Court of Appeals for the Eighth Circuit, urged the appellate court to affirm Judge Mark W. Bennett’s opinion and order on sanctions based on Civil Rule 30(d)(2) and a judge’s inherent authority. 

Judge Bennett, who serves as a district court judge in the Northern District of Iowa, entered sanctions sua sponte against a defense attorney earlier this year for coaching witnesses in two depositions she defended, and for making excessive and unnecessary objections and interruptions during those depositions. Judge Bennett’s opinion also served as a warning to attorneys that unspecified “form” objections are improper.

The defense attorney and her law firm appealed the decision to the Eighth Circuit, but have no adversary in that court defending the judge’s actions. Because the sanctions were issued sua sponte, and not on the motion of opposing counsel, the plaintiff and its counsel did not argue for sanctions in the district court and did not file a brief in the court of appeals. The United States has not intervened to represent the real parties in interest—the United States District Court for the Northern District of Iowa and Judge Bennett—and Judge Bennett is not a party to the appeal.

Senior Litigation Counsel Valerie M. Nannery wrote AAJ’s amicus brief in support of affirmance, specifically urging the court to apply an abuse of discretion standard of review, and to disregard asserted facts that were unrelated to the sanctions in issue. AAJ’s amicus brief also argued that the lower court complied with due process requirements, and that the district court’s order was within its jurisdictional authority.

On November 12, 2014, CCL filed an amicus curiae brief for AAJ in a pair of Federal Tort Claims Act cases in the Supreme Court of the United States. AAJ’s brief, prepared by CCL Senior Counsel Jeffrey R. White, urges the Court to hold that federal courts may suspend the statutory time limits where equity requires.

The FTCA waives sovereign immunity for harm caused by the negligence of federal employees. However, the claimant must file an administrative claim with the agency involved within two years after the cause of action has accrued. Additionally, the claimant must file suit within 6 months after the agency’s denial. Claims that do not comply with these deadlines “shall be forever barred.”

In United States v. Wong, No. 13-1074, plaintiff sought damages arising out her detention by the Immigration and Naturalization Service. While awaiting denial of her administrative claim by the INS, plaintiff filed a motion for leave to amend her existing complaint to add an FTCA claim. However, the district court did not grant her motion until after the six-month deadline had passed.

In United States v. June, No. 13-1075, plaintiff’s decedent was killed in an auto accident in 2005 when a driver lost control of her vehicle on an interstate and crossed through the cable median barrier into oncoming traffic. Plaintiff sued the United States in 2009, after discovering that the Federal Highway Administration had falsely reported that the cable median barrier had passed mandatory federal crashworthiness tests.

In both cases, the Ninth Circuit held that the FTCA time limits were subject to equitable tolling in appropriate cases where plaintiff was diligent in pursuing her claim but was prevented from complying with the limitations by circumstances beyond her control, particularly where the government played a role in creating those circumstances.

AAJ argued to the Supreme Court that the Ninth Circuit’s holding comports with the text of the FTCA, which provides that the federal government “shall be liable in the same manner and to the same extent as a private individual under like circumstances.” Courts have historically exercised their equitable power to toll statutes of limitations in appropriate cases. Equitable tolling also comports with Congress’s purpose of providing redress to those injured by federal government employees. In addition, equitable tolling permits courts in cases like Wong and June to avoid depriving of injured claimants of their statutory causes of action in violation of due process and right of access to the courts. 

CCL President, Robert S. Peck, attended the November 7 Board of Directors meeting of Justice at Stake (JAS), a coalition of organizations that advocate for fair and impartial courts and whose honorary chair is U.S. Supreme Court Justice Sandra Day O’Connor (ret.). The Board meeting took place in San Francisco and was preceded by a evening reception, featuring remarks by California Chief Justice Tani Cantil-Sakauye, who spoke on the need for support of independent courts. Peck, who serves as board secretary for JAS, participated in discussions that set a short- and long-term plan for the work of the organization. 

CCL filed its reply brief in support of its petition for certiorari in Sanchez v. United  States, No. 13-1249, September 4, asking the U.S. Supreme Court to grant full review of this case, which raises the availability of equitable tolling under the Federal Tort Claims Act (FTCA).  At the end of June, the Court granted review in two cases raising the same issue.  In United States v. Wong, set for oral argument on December 10, 2014, the Court will consider whether equitable tolling is available to plaintiffs who filed their original complaint about negligence at the hands of the Immigration and Naturalization Service prematurely, before their administrative complaint had reached disposition, and then again a month after the applicable six-month statute of limitations had expired.  In United States v. June, to be argued the same day, the plaintiff had brought an action against the Federal Highway Administration after it disclosed its earlier decision that a highway barrier, which failed and caused a fatality, had met national standards was erroneous. The disclosure occurred after a two-year statute of limitations had expired.  In both cases, the U.S. Court of Appeals for the Ninth Circuit had found equitable tolling applied to permit the cases to go forward. The United States successfully sought certiorari in both cases, setting up the upcoming arguments in the Supreme Court.

In Sanchez, CCL’s client, a woman, who was a doctor herself, died giving birth because her private doctors allegedly committed malpractice. The case was filed within the three-year statute of limitations applicable in Massachusetts.  However, because the doctors worked for a private community health clinic that received a particular type of federal grant, federal law deemed them federal employees for purposes of any malpractice lawsuit.  Thus, after the case was filed in state court, the United States substituted itself as defendant, removed the case to federal court, and won its dismissal because it was not filed within the two-year statute of limitations applicable to FTCA actions.  The First Circuit affirmed, joining the view expressed by the Seventh Circuit, that medical malpractice lawyers must make efforts to determine whether private doctors can be deemed federal employees, although the opinion acknowledged that this was a “trap for the unwary” and that most efforts to determine federal cloaking of this sort are unlikely to succeed. The United States opposed review – or even the holding of the case during the pendency of Wong and June – because there was no evidence that plaintiffs’ counsel undertook any effort to discover the hidden federal status of the decedents otherwise private doctors.

In urging the Court to take the case nevertheless, CCL’s Robert S. Peck argued that the issue of deemed federal status was distinct and more prevalent than the bases for equitable tolling at issue in Wong and June, that the United States and First Circuit had asserted a requirement for maximum feasible diligence, rather than the proper reasonable diligence standard, that reasonable diligence was met by the extraordinary effort that is required to bring a medical malpractice case, as the Second and Third Circuits had recognized in similar cases, and that there should be no requirement to mount efforts that will only prove futile to claim equitable relief. To require more, the brief argued “borders on requiring extreme diligence or, more likely, clairvoyance.”

The case is scheduled for review by the Court on September 29, during what is known as the “Long Conference,” where the justices review petitions accumulated over the summer.  

On August 15, the Alabama Supreme Court reaffirmed, 6-3, its 2013 ruling in Wyeth, Inc. v. Weeks that the manufacturer of a brand-name prescription drug may be held liable for misrepresentation to a person who has been injured by the equivalent generic drug as a result of his physician’s reliance on the brand-name manufacturer’s representations. After the court had agreed to rehear the case, CCL submitted an amicus brief on behalf of the American Association for Justice in support of reaffirmance, coauthored by CCL Chief Litigation Counsel Louis Bograd and Mobile, Alabama attorney David Wirtes. Today’s opinion largely tracks the argument in the AAJ amicus brief. 

The Alabama Supreme Court began its analysis by noting that plaintiff Weeks’ claim was for misrepresentation, not a products liability action: “This is not a claim that the drug ingested by Danny was defective; instead, it is a claim that Wyeth fraudulently misrepresented or suppressed information about the manner in which (i.e., the duration) the drug was to be taken.” The Court then concluded that Weeks’ claim satisfied all of the traditional elements of fraudulent misrepresentation under Alabama law. The Court first determined that it was reasonably foreseeable that Weeks’ physician would rely on Wyeth’s representations in prescribing the generic equivalent: 

the labeling for a generic drug is required by federal regulations to be the same as the labeling for the brand-name drug. Therefore, an omission or defect in the labeling for the brand-name drug would necessarily be repeated in the generic labeling, foreseeably causing harm to a patient who ingested the generic product. A brand-name manufacturer is well aware of the expiration of its patent and well aware that a generic version of the drug will be made when that patent expires. It is recognized that generic substitutions are allowed in all 50 states. A brandname manufacturer could reasonably foresee that a physician prescribing a brand-name drug (or a generic drug) to a patient would rely on the warning drafted by the brand-name manufacturer even if the patient ultimately consumed the generic version of the drug.

The Court next rejected Wyeth’s argument that it could not be liable because it made no representations at all to the plaintiff:

Wyeth's argument completely ignores the nature of prescription medication. The Weekses cannot obtain Reglan or any other prescription medication directly from a prescription-drug manufacturer. The only way for a consumer to obtain a prescription medication is for a physician or other medical professional authorized to write prescriptions (i.e., a learned intermediary) to prescribe the medication to his or her patient. This Court has adopted the learned intermediary doctrine, which provides that a prescription-drug manufacturer fulfills its duty to warn users of the risk associated with its product by providing adequate warnings to the learned intermediaries who prescribe the drug and that, once that duty is fulfilled, the manufacturer owes no further duty to the ultimate consumer. When the warning to the prescribing health-care professional is inadequate, however, the manufacturer is directly liable to the patient for damage resulting from that failure.

Finally, the Alabama Supreme Court rejected the argument that Wyeth owed no duty to the user of a generic drug. Under Alabama law, the Court declared:

there is a duty not to make a false representation (1) to those to whom a defendant intends, for his own purposes, to reach and influence by the representation; (2) to those to whom the defendant has a public duty created by statute or pursuant to a statute; and (3) to those members of a group or class that the defendant has special reason to expect will be influenced by the representation.

Wyeth clearly owed a duty to the Plaintiff under this standard.

The issue came to the Supreme Court on a certified question from the U.S. District Court for the Middle District of Alabama. The case will now return to that court for further proceedings.

CCL has filed an amicus curiae brief August 12 on behalf of the American Association for Justice, asking the Supreme Court to reject calls for more intrusive inquiry into jury deliberations by litigants seeking to overturn a verdict.

In Warger v. Shauers, No. 13-517, the Supreme Court must decide whether a new trial is warranted when a juror reports that, during deliberations, another juror said something appearing to be inconsistent with answers to questions posed during voir dire. The district court denied a new trial motion after the verdict, holding that Federal Rule of Evidence 606(b) barred use of juror testimony or affidavits to impeach the verdict. The Eighth Circuit affirmed, though the court acknowledged that there was a split among the circuits regarding the admissibility of juror testimony to show that a juror gave false information on voir dire. The Supreme Court granted certiorari.

In an amicus brief authored by CCL Senior Counsel Jeffrey White, AAJ argued that history, the Rule’s text, and the strong policy reasons underlying the Rule counsel against expanding judicial inquiry into jury deliberations. The Supreme Court has consistently adhered to the common law rule that juror testimony is not admissible to impeach the jury’s verdict. It has permitted limited exceptions only where the testimony showed the jury was exposed to prejudicial extraneous information or improper outside influences. White further argued that, although the right to a fair and impartial jury is important, perfectly unbiased juries in every case is an impossible goal. Moreover, other important values are also at stake. The confidentiality of jury deliberations is essential to the jury’s function and to the great respect accorded their verdicts. Additionally, allowing new trials based on juror testimony would make jurors the targets of harassment by disappointed litigants, particularly those with resources to pursue such inquiries. Finally, allowing such inquiries would enmesh federal courts in a seemingly endless cycle of putting jurors on trial in an effort to unravel their work. Allowing losing litigants to probe the jurors’ mental processes would further erode the constitutional right to trial by jury.

On July 30, the California Court of Appeals handed down a major ruling on personal jurisdiction in Bristol Myers Squibb v. Superior Court. That cases involves hundreds of personal injury claims brought by both in-state and out-of-state plaintiffs in California state court against BMS and its distributor, McKesson, for injuries caused by BMS’s prescription drug Plavix. BMS moved to quash service of process of the claims brought by the out-of-state plaintiffs, contending that, under the recent Supreme Court general jurisdiction decisions in Goodyear Dunlop Tires Operations, S. A. v. Brown (2011),and DaimlerChrysler AG v. Bauman (2014), it was not subject to personal jurisdiction in California courts for those claims. The California Court of Appeals affirmed the denial of BMS’s motion to quash service. 

The Court of Appeal agreed with BMS that, under the recent Supreme Court authority, it was not subject to general personal jurisdiction in California. It nevertheless found that BMS was subject to specific personal jurisdiction over the claims brought by the non-California plaintiffs because of the substantial connection between those claims and BMS’s activities selling Plavix in California: “The crucial inquiry concerns the character of the defendant’s activity in the forum, whether the cause of action arises out of or has a substantial connection with that activity, and the balancing of the convenience of the parties and the interests of the state in assuming jurisdiction.” The court found that the claims of the non-California plaintiffs were substantially connected to the identical claims brought by California plaintiffs injured by Plavix, that BMS had not shown undue burden or unfairness in having to litigate the claims in California (indeed, it was likely to benefit from judicial economies in litigating the cases together), and California had an interest in providing a forum in which the claims of both California and non-California plaintiffs could be litigated together. 

The out-of-state plaintiffs were represented by CCL attorneys Louis Bograd and Robert Peck, and by Hunter Shkolnik and Shayna Sacks of Napoli Bern Ripka Shkolnik LLP in New York. A copy of the opinion can be found here: http://www.courts.ca.gov/opinions/documents/A140035.PDF.

At the Leadership Breakfast held during the American Association for Justice Convention in Baltimore July 27, AAJ President Burton LeBlanc honored CCL's Robert S. Peck with the David S. Shrager President’s Award for his outstanding contributions to the civil justice system and to the work of AAJ.

In presenting the award, LeBlanc talked about Peck's victories challenging different tort reforms around the country and quoted from the Florida Supreme Court's March 2014 decision in Estate of McCall v. United States, which struck down that state's 2003 law capping non-economic damages in medical malpractice cases resulting in wrongful death.  The Shrager Award is named after a revered past president of AAJ, who served in that capacity from 1983-84 and who, as a Philadelphia trial lawyer, exhibited an unrivaled passion for the law and for the trial bar, as well as making an outstanding contribution to civil justice and to the work of AAJ.

In accepting the award, Peck picked up on a theme that had been sounded by the breakfast's featured speaker, Professor Laurence Tribe of Harvard Law School, on the hostility that the Supreme Court had shown to litigation in its recent decisions, and talked about how the work in assuring access to the courts was a labor of love by each of the attorneys who constitute CCL, while also sounding a note about how special the award was because of Peck's past association with David Shrager. 

After a federal judge dismissed with prejudice three actions brought by the City of Miami against Bank of America, Wells Fargo, and Citibank, CCL, as part of the City's legal team, filed motions for reconsideration and leave to amend, along with supporting memoranda of law. The lawsuits seek damages for loss of tax base and the costs of extra fire and police protection for abandoned properties as a result of the banks' predatory lending practices on the basis of the federal Fair Housing Act (FHA) and a cause of action for unjust enrichment. 

In the order dismissing the actions, the judge, sitting in the Southern District of Florida, held that Miami lacked standing to initiate an FHA action and that other economic conditions made it impossible to demonstrate that the banks improper lending practices were a proximate cause of the city's injuries. The CCL memorandum, written by CCL President Robert S. Peck and Senior Litigation Counsel Valerie Nannery, argued that the city's original complaint met the standing requirements set by U.S. Supreme Court precedent and that Eleventh Circuit precedent did not require complaints to eliminate other possible causes to survive a motion to dismiss.  Even so, the motion asked the court to permit the filing of a first amended complaint that would supply the elements that the Court believed were missing and could not be met.

The Missouri Supreme Court held that a railroad may not withhold Railroad Retirement Taxes or other employment taxes from payment in satisfaction of an FELA on July 8, closely tracking an amicus brief filed by CCL Senior Counsel Jeffrey White on behalf of the American Association for Justice. Mickey v. BNSF Ry. Co., --- S.W.3d ----, 2014 WL 3107443 (Mo. July 08, 2014). 

A jury awarded former brakeman Lawrence Mickey nearly $400,000 against BNSF Railway under FELA for a permanently disabling back and knee injuries. BNSF tendered payment in satisfaction in the amount of the judgment less an amount it withheld for Tier 1 and Tier 2 Railroad Retirement taxes and Medicare tax. The trial court declined to credit BNSF for payment of the full judgment. On appeal, the railroad argued that a FELA judgment that includes damages for lost wages is deemed “compensation” under the Railroad Retirement Act and taxable under the Railroad Retirement Tax Act. The United States filed an amicus brief supporting BNSF; AAJ’s brief was filed in support of Mickey. The appeals court affirmed without reaching the issue of the taxability of the FELA award, Mickey v. BNSF R. Co., 2013 WL 2489832 (Mo. App. 2013), and the case was transferred to the Supreme Court of Missouri.   

The Missouri Supreme Court held that the FELA damage award was not subject to Railroad Retirement taxes and thus was not subject to withholding by BNSF, as CCL’s brief argued. Because damages paid on account of personal injury are not “income,” pursuant to Internal Revenue Code § 104, they cannot be “wages” or “compensation,” which are narrower categories, for purposes of employment taxes. The railroad’s reliance on the Railroad Retirement Act was inapposite because that statute governs the calculation of retirement benefits, not taxes.