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ADMINISTRATIVE LAW Urine test methods need no administrative OK Although Florida’s implied consent law says that any person who operates a motor vehicle within the state is “deemed to have given his or her consent to submit to an approved chemical test or physical test including . . . a urine test,” those testing methods need not be adopted in accordance with the state’s Administrative Procedure Act, the Florida Supreme Court said on April 15. State v. Bodden, No. SC03-622. During a traffic stop, a police officer read Anthony Bodden the implied consent warning after noticing signs that he may have been drinking. Bodden agreed to take a breath test and a urine test. The former showed that he was driving under the influence, the latter indicated the presence of a controlled substance. The trial court granted Bodden’s motions to suppress the urine test results and certified to the state’s 2d District Court of Appeal the question of whether the implied consent law requires that urine-testing procedures be approved through formal promulgation in accordance with the act. The 2d District answered affirmatively and then certified the same question to the Supreme Court. Quashing the appellate decision, the Florida high court ruled that urine tests need not be adopted in accordance with the act because the word “approved” in the statute modifies only the phrase “chemical test” and not “urine test.”   Full text of the decision BUSINESS LAW Can’t assign noncompete without worker’s OK An employer may not assign an employee noncompetition covenant unless an arm’s-length agreement subject to separate consideration explicitly permits assignment, the Nevada Supreme Court held on April 13. Traffic Control Serv. Inc. v. United Rentals Northwest Inc., No. 40798. Philip Burkhardt sells and rents trench-shoring equipment to construction contractors. Initially, he worked for United Rentals Northwest, but in November 2000, he left to work for NES Trench Shoring. In exchange for $10,000 and as a condition of employment, he signed a noncompetition covenant which said that, if his NES employment was terminated, he was barred from dealing in trench-shoring equipment within 60 miles of NES for one year. He also signed a confidentiality agreement. Two years after Burkhardt joined NES, the company sold itself to United. Burkhardt’s noncompete clause did not contain any assignment provision and he refused United’s request that he sign a new covenant. After a month back with United, Burkhardt left to work for a competitor, Traffic Control Services. When he ignored a notice from United that his new employment allegedly breached his covenants, United and NES sued to enforce them. A trial court entered a preliminary injunction enforcing the NES covenant for one year after his departure and enjoined Burkhardt from using confidential information. Reversing, Nevada’s high court ruled that without separate consideration, the covenants are not assignable. It said, “This places the burden on the employer to seek assignability and adequately compensates the party with the lesser bargaining power for the possibility that a stranger to the covenant may ultimately assume the right to its enforcement.”   Full text of the decision CIVIL PRACTICE 10-year limitations time for Iowa benefits claim In a suit filed by Iowa’s last polio victim, the 8th U.S. Circuit Court of Appeals ruled on April 13 that under Iowa law, an employee’s suit alleging the improper denial of preauthorization for health benefits is a breach-of-insurance-contract case governed by a 10-year statute of limitations, not an action to recover lost wages, controlled by a two-year period. Shaw v. The McFarlane Clinic, nos. 02-3897 and 03-1167. Debra Shaw sought preauthorization from her employer’s health plan for surgery to augment a weak and malformed calf muscle. The plan denied the preauthorization, concluding that the surgery was cosmetic. Shaw and her doctor argued that the cosmetic effect was secondary to her medical condition. On May 21, 1998, the plan again denied the claim. Shaw paid for the surgery out of pocket, then sued the health plan under the Employee Retirement Income Security Act on May 25, 2001, alleging that the denial of preauthorization was an abuse of discretion and a breach of contract. A trial court awarded her nearly $11,000. On appeal, the plan argued Shaw’s action was barred by Iowa’s two-year limitations term for wage claims. Affirming, the 8th Circuit explained that while wage claims can be construed to cover more than mere paycheck disputes, such as benefits, the statute’s reference to a “fund for the benefit of the employee” refers to specific funds available to specific employees, like pension or retirement funds, not funds held to be generally applied to all employees. It concluded that the claim is analogous to one for breach of an insurance contract, subject to the 10-year statute.   Full text of the decision CONSTITUTIONAL LAW Limits on size of protest violate First Amendment The county ordinance invoked by the Masters Golf Tournament to prevent political protests at the entrance to the Augusta National Golf Club is unconstitutional, the 11th U.S. Circuit Court of Appeals ruled on April 15. Burk v. Augusta-Richmond County, No. 02-11756. Augusta-Richmond County passed an ordinance preventing five or more people from protesting on a public right-of-way without a permit. It also required groups securing a permit to furnish an indemnification agreement. A “public demonstration or protest” was defined as “support for, or protest of, any person, issue, political or other cause or action.” Martha Burk, representing a coalition of women’s groups that want the club to open its membership to women, challenged the law’s constitutionality. A Georgia federal court converted her request for a temporary restraining order into a motion for preliminary injunction, and denied it. Reversing, the 11th Circuit said that the ordinance is not content-neutral because it singles out political protest. It does not advance the county’s stated goal of maintaining public safety, avoiding traffic congestion, keeping the peace and providing advance notice to law enforcement. The court added that the indemnity provision lacks any guiding standards, allowing for too much discretion in choosing among viewpoints.   Full text of the decision CONTRACTS One contract’s clause applies to entire series A forum-selection clause located in one of a series of contracts spelling out the relationship between a party and a group of affiliated corporations controls the parties’ entire relationship, the 7th U.S. Circuit Court of Appeals ruled on April 16. American Patriot Ins. Agency Inc. v. Mutual Risk Management Inc., No. 03-1684. The American Patriot insurance company entered into a series of contracts with a group of affiliated corporations regarding the sale of liability insurance to roofing contractors. The parties’ principal agreement contained a forum-selection clause stating that disputes would be governed by the laws of Bermuda and resolved by the courts there. After American Patriot repeatedly sustained losses under the contracts, it sued the corporations in an Illinois federal court, alleging breach of contract and fraudulent inducement. After filing for bankruptcy in Bermuda, the defendants moved to dismiss the Illinois case for improper venue. A district court granted the motion. Affirming, the 7th Circuit said that the contracts are a package that govern an entire insurance program. Since all the defendant affiliates worked together to create and administer the program, disputes arising under any of the contracts are disputes concerning the principal agreement. Thus, its forum-selection clause applies to all of the contracts.   Full text of the decision EVIDENCE Domestic shelter records confidential in Missouri A trial court cannot order the production of records identifying residents of a domestic violence shelter even if those records might pertain to known or suspected child abuse, the Missouri Supreme Court ruled on April 13. State ex rel. Hope House Inc., No. SC85638. After Maria Martinez left her children at such a shelter in September 2002, a court eventually ordered the children to stay with their mother, but under the supervision of child protective services. Over the next several weeks, Martinez and her children moved to three more shelters, the last being Hope House. A protective services officer then moved to modify the court order, claiming that she had failed to provide a stable household and was in an abusive relationship. As part of this proceeding, a subpoena was served on Hope House, directing it to produce its records relating to Martinez and her children. The shelter moved to quash it under Mo. Rev. Stat. � 455.220.1(5), which bars the release of information that could identify a shelter resident. The trial court denied the motion, saying the privilege of confidentiality was overridden by Mo. Rev. Stat. � 210.410, which limits certain certain legal privileges when child abuse is suspected. The Missouri Supreme Court reversed. It explained that � 210.140 limits “privileged communication,” an undefined term that the court interpreted as meaning traditionally recognized evidentiary privileges. But documents controlled by � 455.220, it said, are not privileged because confidentiality in that section is mandatory, applying to every shelter worker, even ones who have not been in contact with residents. It can only be waived by the resident and then only when testimony is ordered.   Full text of the decision FAMILY LAW Natural father cannot partake in rights case A married couple’s admission, and a court’s finding, that another man fathered three of the couple’s four children did not give that man standing as the natural father to partake in the couple’s neglect proceedings, the Michigan Supreme Court held on April 14. In re KH: Family Independence Agency v. Jefferson, No. 122666. Tina Jefferson conceived and had four children while legally married to Richard Jefferson, who is in prison. Richard is the children’s only recognized father under Michigan law. A trial court authorized a petition requesting termination of the couple’s parental rights to their children. But on a social services agency motion, the petition was amended to request termination of any parental rights held by putative fathers Frederick Herron and Larry Lagrone. Tina testified that Herron is the biological father of one child and that Lagrone fathered the others. Richard confirmed that he is not the children’s father and asked to be excused from the proceedings. At trial, Lagrone sought to establish a legal relationship with three of the children. A referee found that Lagrone was their biological father and a trial judge adopted that finding and granted the motion to establish paternity. But he did not make an express finding that the children were not the issue of the marriage. Remanding, Michigan’s high court ruled that Lagrone never had standing to establish paternity. If a minor has “no father,” a court may try to determine the identity of the natural father, the high court explained. But where there is a “legal father,” only he may be identified as a respondent in a termination proceeding, unless the minors are determined to be “born out of wedlock.” When Lagrone sought to establish his paternity, there had been no such adjudication.   Full text of the decision GOVERNMENT Prior suit against official bars later individual suit Res judicata precludes suing Ohio county commissioners in a state court in their individual capacities for acts that were the subject of a prior federal suit against them in their official capacities, the Ohio Supreme Court held April 14. Kirkhart v. Keiper, No. 2003-0046. Beverly Kirkhart filed suit in federal court against Portage County commissioners, pleading federal law claims of sex discrimination, handicap discrimination and retaliation. A jury found in her favor. She was reinstated and given back pay, benefits and damages of $940,000 (capped at $300,000 by federal law). A few years later, Kirkhart filed a state court action against three of the commissioners as individuals, this time, alleging state law claims of sex discrimination, handicap discrimination and retaliation. A trial court granted summary judgment to two of the defendants, based on res judicata. But an intermediate appellate court reversed, finding that there was no privity between the parties as officials and the parties as individuals. Reversing, the Ohio Supreme Court held that, for purposes of res judicata, privity between defendants is established where a plaintiff brings lawsuits against the same public officials for acts performed in their official roles, even though the defendants are officials in one action and individuals in the other. In this case, the court said, all of the acts at issue were performed in the defendants’ official capacities.   Full text of the decision TORTS Texas law permits pass-through claims Texas recognizes pass-through claims -contractors bringing suit against property owners on behalf of a subcontractor -the Texas Supreme Court ruled on April 16. Interstate Contracting Corp. v. City of Dallas, No. 03-0152. In a federal suit, Dallas and Interstate Contracting Corp. (ICC) contracted for work related to a city-owned water treatment plant. ICC, in turn, contracted with Mine Services Inc. (MSI) to build levees and excavate a storm-water detention lake. When the material to be used could not be extracted from an existing source, MSI made its own. ICC told the city of the additional time and cost, but the city indicated it would not pay more. Pursuant to a pass-through clause in its contract with MSI, ICC sued the city for breach of contract. The city countered that Texas does not allow pass-through suits. A federal district court allowed the claim, but the 5th U.S. Circuit Court of Appeals certified the question to the Texas Supreme Court. The circuit court asked: Does the state allow such claims, and, if so, what is the burden of proof? Texas allows the claims, the state Supreme Court answered. The high court concluded that contractors should be allowed to recover costs from the owner, regardless of whether the contractor performed the work itself or whether a subcontractor did. Otherwise, the court said, the owner could receive a windfall because the subcontractor lacked privity with the owner and the contractor lacked standing to sue the owner for damages suffered by the subcontractor.   Full text of the decision

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