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ADR Self-arbitration clause not unfair, court says Under New York law, an arbitration clause that provides for a panel whose arbitrators are all directors and partners of the respondent accounting firm is enforceable, the Connecticut Supreme Court said on May 4. Hottle v. BDO Seidman LLP, No. SC 16941. Dean Hottle sued BDO Seidman, the accounting firm where he had been a partner. The firm moved to compel arbitration, relying upon an arbitration clause in the partnership agreement between Hottle and the firm. (The agreement specified that New York law would control.) Hottle opposed, arguing that because the clause authorizes the firm, not a neutral party, to arbitrate the dispute, that the provision is illusory and contrary to public policy. A trial court ruled for the firm. An intermediate appeals court affirmed. Upholding that ruling, the Connecticut Supreme Court noted that New York law favors arbitration of disputes. It also said that the firm’s partners are “neither legally equivalent to the firm nor so identified with the [firm] that the law should presume, in advance, that they are incapable of conducting a fair and impartial adjudication of the underlying dispute.” Full text of the decision CIVIL RIGHTS Failure to enforce TRO is due process rights breach In an en banc rehearing of a civil rights claim, the 10th U.S. Circuit Court of Appeals ruled on April 29 that a police department’s failure to enforce a temporary restraining order (TRO)-a failure that led to the deaths of three children-violated their mother’s procedural due process rights. Gonzales v. City of Castle Rock, No. 01-1053. Jessica Gonzales had obtained a TRO against her estranged husband who, nonetheless, was still allowed parental time with their three daughters. One evening the husband abducted the girls while they were playing outside their home. Gonzales reported it to the police, who refused to enforce the TRO or to find the children. Later that night, the husband arrived at the police station and opened fire with a semi-automatic handgun. He was shot to death. The police discovered that he had murdered the girls and left them in the cab of his truck. Gonzales filed a � 1983 claim against the city and police department, which was dismissed by a Colorado federal court. Reversing, the en banc panel held that the mother had a property interest in the enforcement of the TRO. The police failure to enforce it denied her due process. Full text of the decision EMPLOYMENT More than one way to be liable for sex harassment Adverse-employment action and hostile-environment are separate theories of vicarious liability for sexual harassment; they are not separate causes of action and need not be pleaded distinctly, the 11th U.S. Circuit Court of Appeals ruled on April 27. Hulsey v. Pride Restaurants LLC, No. 03-11960. A 17-year-old girl was allegedly subjected to verbal and physical sexual advances by her 20-year-old supervisor at a Burger King restaurant in Jasper, Ala. After weeks of this treatment, which the girl consistently rebuffed, the supervisor fired the girl when she turned down his offer to take a break to see a family member in exchange for letting him “get into [her] pants after work.” The girl filed a sexual harassment suit against the restaurant owner under Title VII of the Civil Rights Act of 1964. She alleged she had suffered an adverse employment action and had worked in a hostile environment. Without specifying its reasons, the district court granted the defendant’s motion for summary judgment. Reversing, the 11th Circuit said that adverse employment activity and hostile environment are labels for various theories of employer vicarious liability. The girl was not required to plead each theory as a separate count, and had alleged sufficient facts to merit a trial on either. Full text of the decision FAMILY LAW Parental rights can’t be denied to incest victim A Wisconsin statute that provides for the termination of parental rights based on incestuous parenthood violates the substantive due process rights of an incest victim, the Wisconsin Supreme Court held on April 28. In re the Termination of Parental Rights to Zachary B., nos. 03-0060, 03-0061, 03-0062. Kelli B. was involved in an incestuous relationship with her father beginning at age 12 and had three children by him. Fearing for her safety and that of her children, she kept the father’s identity secret until the birth of her third child. When she was arrested on unrelated charges, the county took custody of her children. After it could not get her to a point where she could take care of the children, the county petitioned for termination of her parental rights under Wis. Stat. � 48.415(7) on the ground of incestuous parenthood. A trial court terminated her rights. An intermediate appellate court reversed. Affirming, the state Supreme Court held that a mother has a fundamental liberty interest in parenting her children, and that the statute is not narrowly tailored to advance a compelling state interest. While the statute’s purpose is to protect children from unfit parents, the fact that a person is an incest victim does not, by itself, render her an unfit parent. Full text of the decision GOVERNMENT U.S. must pay DuPont for its cleanup costs A 1946 indemnity agreement between the U.S. government and E.I. du Pont de Nemours & Co. applies to claims brought under the later-enacted Comprehensive Environmental Response Compensation and Liability Act (CERCLA), the U.S. Court of Appeals for the Federal Circuit ruled on April 28. E.I. du Pont de Nemours & Co. v. U.S., No. 03-5137. DuPont contracted with the United States in 1940 to build and operate a chemical plant in Morgantown, W.Va. The contract included a reimbursement clause and an indemnification clause that stated that the government would hold DuPont harmless against any loss, expense or damage in connection with the performance of the plant. The original contract was terminated in 1946 and a new agreement was drawn up, one that preserved the indemnification clause. In the mid-1980s, the Environmental Protection Agency notified DuPont of its intention to designate the plant site for cleanup under CERCLA. After conducting remedial investigation and a feasibility study, DuPont filed suit against the government to recover the costs it expended. The district court entered judgment for the government. Reversing, the Federal Circuit found the 1946 indemnification clause was still in effect and rejected the government’s theory that the parties’ inability in 1946 to conceive of a statutory scheme like CERCLA justifies reading the indemnification clause to exclude CERCLA costs. CERCLA was based on the doctrine of common law nuisance, it said, adding that under the Contract Settlement Act of 1944, the War Department, which was the contracting agency, was allowed to grant open-ended indemnity to government contractors. Full text of the decision INTELLECTUAL PROPERTY Builder-bashing Web site not a ‘Lanham’ violation A dissatisfied customer is not liable for registering a Web site to complain about a homebuilder, the 5th U.S. Circuit Court of Appeals held on April 21. TMI Inc. v. Maxwell, No. 03-20243. After a bad experience with TrendMaker Homes, Joseph Maxwell registered an Internet domain name, www.trendmakerhome.com, for one year, during which time he used it to publish information about his experience. The site included a statement that it was not TrendMaker’s official Web site, and a section where readers could share information about good contractors. TMI Inc. sued, alleging violations of two statutes in the federal Lanham Act that prohibit “cybersquatting” and dilution of a company’s “mark,” as well as the Texas anti-dilution statute. After a bench trial, a Texas federal court ruled that Maxwell’s site violated all three laws and ordered him to pay $40,000 in damages. Reversing, the 5th Circuit noted that the federal anti-dilution statute requires the diluter to have made “commercial use” of the mark. It found no evidence of commercial use by Maxwell. Similarly, the Anti-Cybersquatting Consumer Protection Act requires a “bad faith intent to profit,” which was not evident here, the 5th Circuit said. Since the state anti-dilution law says that it is “not intended to address non-trademark uses of a name to . . . criticize” the business of the name’s owner, Maxwell did not violate it. Full text of the decision LEGAL PROFESSION Legal-form firm had no business practicing law An April 29, the Florida Supreme Court upheld the state bar’s finding that a legal-form preparation service was engaged in the unauthorized practice of law. The Florida Bar v. We The People Forms and Svc. Center of Sarasota Inc., No. SC02-1675. The Florida Bar brought a complaint alleging nine counts of unauthorized practice against We The People, concerning its business of helping people prepare legal forms. A referee found that the company had engaged in unauthorized practice by providing legal assistance, correcting customer errors, preparing the forms, holding themselves out as customers’ representatives and holding licensed attorneys out as supervising attorneys. The referee enjoined We the People from engaging in any of these activities and assessed a $9,000 fine. The Florida Supreme Court affirmed without any comment except to cite a string of cases finding similar conduct to be unauthorized practice of law. The court also upheld the fine because Rule Regulating the Florida Bar 10-7.1 allows for a $1,000 fine to be assessed for each count of unauthorized practice. Full text of the decision PRODUCTS LIABILITY D.C. law may render gun makers liable for injuries The district of Columbia cannot bring a public nuisance claim against firearm manufacturers and nine individual plaintiffs cannot bring common law negligence claims, but the individuals can bring a statutory cause of action under the city’s Assault Weapon Manufacturing Strict Liability Act of 1990, the District of Columbia Court of Appeals ruled on April 29. Dist. of Columbia v. Beretta USA Corp., nos. 03-CV-24 and 03-CV-38. The city and nine gunshot victims sued the gun makers for turning a blind eye to the distribution of firearms to unregulated “kitchen-table” purchasers. The trial court dismissed all of the claims against the defendants. The appeals court, the district’s highest, affirmed in part and reversed in part. It dismissed the negligent distribution claims due to the lack of special relationship between the defendants and the city or the individuals for the criminal acts of third parties. To do otherwise, it said, would create a limitless plaintiff class of all residents of D.C. who could, through any number of ways, become shooting victims. But, because D.C. law specifically allows a cause of action for injuries sustained as a result of assault weapons, the individuals can proceed with discovery on that claim. It also upheld the constitutionality of the strict liability statute. Full text of the decision TORTS Fear of cancer spread no basis for negligence claim Fear of metastasis of cancer may not be the basis for a claim of negligent infliction of emotional distress, the Ohio Supreme Court said on April 28. Dobran v. Franciscan Medical Center, No. 2002-1994. Malignant melanoma patient John J. Dobran decided to have a lymph node biopsy to learn if the melanoma had metastasized. Normally, one part of the node would be tested using traditional histology, involving microscopic examination. But after discussion with his doctor, Dobran agreed to have other node samples sent to California for Polymerase Chain Reaction (PCR) screening. Although the samples that were tested by traditional methods were negative for metastasis, the samples that were sent for PCR screening thawed before arriving, rendering them unusable. When Dobran sued the medical personnel involved, alleging negligent infliction of emotional distress, the trial court granted the defendants’ motion for summary judgment. But, an intermediate appellate court reversed. Overturning that ruling, Ohio’s high court said that Dobran did not develop cancer as a result of the defendants’ acts and that the defendants did not place him in any immediate risk of physical harm. It also said that although the PCR screening could not be done, it was not yet the current standard of care. The current standard, traditional histology, was met and eliminated any actual peril or need for further treatment. Full text of the decision

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