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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 August 6, a panel of judges on California’s Fourth District Court of Appeal, Division Two, heard argument from CCL’s Senior Litigation Counsel Valerie M. Nannery that the state’s $250,000 cap on noneconomic damages in medical malpractice cases violates the right to a jury trial under the state constitution. The appeal came after a jury determined that the plaintiffs were entitled to $3.75 million in damages for noneconomic injuries including permanent paralysis, pain and suffering, and loss of consortium. Under California’s Medical Injury Compensation Reform Act of 1975 (MICRA) cap, the trial judge reduced this portion of the jury’s verdict to $500,000: $250,000 for each plaintiff.

Nannery argued that, under the California Constitution and California Supreme Court precedent, the proper analysis of the right to trial by jury is an historical one. She argued that one of the most essential features of the right to jury trial is that the jury determines the facts, and damages in civil actions at common law are a question of fact. Nannery urged the court to use the historical analysis of the right to jury trial, as the highest courts in Oregon, Washington, Georgia and Missouri have, and hold that the MICRA cap violates the state’s “inviolate” right to trial by jury in civil actions.

The plaintiffs are represented by CCL’s Valerie M. Nannery, David Bricker of Waters Kraus & Paul in Los Angeles, CA, Burt Rosenblatt of Ely, Bettini, Ulman & Rosenblatt in Phoenix, AZ, and Steven B. Stevens in Los Angeles, CA. The case was fully submitted at the end of the August 6th hearing, and the parties await the court’s decision.

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.

CCL President Robert S. Peck, made presentations to the Professionalism Committee at the Conference of Chief Justices (CCJ) annual meeting, held in White Sulphur Springs, West Virginia July 20-23.  At the meeting, chaired by Chief Justice Brent Dickson of Indiana, Peck won endorsement of a resolution he authored on judicial disqualification that will be considered at the American Bar Association Annual Meeting in Boston in August.  Peck also presented information about the status of a White Paper on professionalism authored by the American Civil Trial Roundtable.

The Conference of Chief Justices is an organization of the judicial leaders of the highest courts of all U.S. States and territories.  During the meeting, Peck also participated in the meeting of the CCJ Civil Justice Committee, which is examining rules and best practices in expediting civil trials.  As part of that effort, the CCJ has established a task force comprised of judges, lawyers, and law professors to study the issue.  Peck serves as a liaison from the ABA Tort Trial and Insurance Practice Section to the task force, which next meets in November.

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. 

 Damages on account of personal injury are not “income” for income tax purposes under Internal Revenue Code § 104, even if part of the award is for lost wages. It has long been assumed, though without express statutory authority, that such damage awards were also not “wages” or “compensation” for purposes of employment taxes, including FICA, Medicare, and Railroad Retirement taxes. Recently, however, BNSF Railway has withheld Railroad Retirement taxes from payments to injured workers in satisfaction of FELA judgments. BNSF argued, with support from the United States as amicus curiae, that such payments are “compensation” under the Railroad Retirement Tax Act. The supreme courts of Nebraska and Iowa have agreed.

A federal district court recently held that FELA damages on account of personal injury are not subject to RRTA withholding. Cowden v. BNSF Ry. Co., 4:08CV01534 ERW (E.D. Mo. July 7, 2014). The court took note of a recent article by CCL Senior Counsel Jeffrey R. White, The Taxman Cometh . . . To Your FELA Judgment, TRIAL, Apr. 2014, at 16, analyzing this issue. The court determined that FELA damages for lost income could be “compensation.” However, as detailed in the Trial article, “income” is broader than “compensation” and plaintiff’s entire award is excluded from income by section 104. The district court concluded that BNSF improperly withheld Railroad Retirement taxes from its payment in satisfaction of plaintiff’s FELA judgment.

In 2009, a severe windstorm collapsed the staging at the Indiana State Fair, killing seven people and injuring 58 more.  Jordyn Polet, then aged 10, was there with her mother, sister and a family friend.  The friend was killed, while the mother and sister suffered severe injuries.  Jordyn’s physical injuries were relatively minor, but she was diagnosed with traumatic stress syndrome from the experience. The State of Indiana decided to settle its liability with all potential claimants.  Invoking the aggregate cap in the state tort claims act, the State hired mediator Kenneth Feinberg to distribute the act’s maximum liability of $5 million among the victims.  Feinberg implemented a scale that paid 65 percent of the then-existing medical and hospital expenses to each victim, while also paying at least $300,000 in each of the wrongful death cases.  For Jordyn, the settlement offer was $1,690.65. She turned the offer down.  As a result, the State then distributed that amount among the remaining settling claimants.  Later, after legislative action, the State sweetened the settlement pot by another $6 million that would be distributed in like manner only among the settling claimants.  When Jordyn filed her complaint in court under the tort claims act, the State asserted an affirmative defense that it was immune from suit because it had paid out its maximum liability of $5 million. When Jordyn challenged that affirmative defense on constitutional grounds, the trial court denied her motion for partial summary judgment.

The case now moves to the appellate court, where CCL’s Robert S. Peck filed an opening brief that asserts that Indiana’s unaccepted settlement cannot eviscerate Jordyn’s valid, accrued cause of action to which the tort claim act constitutes consent. The brief argues that the termination of her claim by the trial court violates Indiana’s open courts guarantee.  Moreover, because the act contains both an individual cap of $700,000 and an aggregate cap of $5 million, implementation of the act violates the state constitution’s equal privileges provision by treating those who have the misfortune of being injured with many others differently from those who are injured alone and eligible for up to a $700,000 recovery.  The unequal treatment of tort claimants raises an issue similar to one resolved in March by the Florida Supreme Court in another case argued by Peck, where it held the state’s aggregate cap in medical-malpractice wrongful death cases violated the state constitution’s equal protection guarantee. 

CCL President Robert S. Peck addressed members of the National Association of Appellate Court Attorneys (NAACA) at their annual conference, held this year in Savannah, Georgia, on July 9, about issues of access to the courts.  NAACA is a nine-year-old organization that consists of attorneys employed by state and federal appellate courts across the country.  Peck was a speaker as well at NAACA’s 2012 conference on the topic of the constitutionality of tort reform, held that year in Washington, D.C.  In his remarks, Peck reviewed precedent, constitutional issues, and statutory provisions that impel courts to take specific steps to assure that parties can participate meaningfully in their cases, as well as recent U.S. Department of Justice directives implementing Title VI of the Civil Rights Act. One area of concern that NAACA members sought counsel on was obligations toward parties that do not have fluency in English, a growing concern when recent census statistics indicate that 25 million people in the United States do not speak English in their homes and are not proficient in English.