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CIVIL PRACTICE Attorney’s presence in court prevented default A trial court erred in entering a default judgment against a litigant who failed to attend trial because the litigant’s attorney was present in court, the Maine Supreme Judicial Court held on May 12. Owen v. Healy, No. 2006 ME 57. Charlotte Owen and Sean Healy were involved in an automobile collision. Owen-through her insurer-sued Healy, alleging that his negligence was the cause of the collision. Owen did not subpoena Healy, and Healy was not present in court when the case was called for trial. However, Healy’s counsel was present. When the trial court learned that Healy was not present, it entered a default judgment against him. Healy appealed, arguing that because he had not been subpoenaed and was represented by counsel, he was not required to be present at trial. Reversing, the Maine Supreme Judicial Court held that Healy was not required to be present at trial. The court said, “Evidence of a party’s unexplained failure to appear in person is ‘highly relevant and probative evidence’ at trial. But such evidence must be considered at trial. It does not justify a default that avoids trial where, as here, the missing party is represented by counsel at the trial. Default was not proper upon Healy’s failure to appear in person at trial.”   Full text of the decision CONSTITUTIONAL LAW 200 years in prison isn’t cruel & unusual penalty Two hundred years in prison for possession of child pornography does not violate the Eighth Amendment to the U.S. Constitution as excessive punishment, the Arizona Supreme Court held on May 10. State of Arizona v. Berger, No. CR-05-0101-PR. Based on his possession of 20 images of child pornography, Morton Robert Berger was convicted of 20 separate counts of sexual exploitation of a minor under the age of 15 and sentenced to 20 consecutive 10-year prison terms. Under Arizona statutory law, the possession of each image is a separate offense, consecutive sentences apply for each conviction and each sentence must be at least 10 years, to be served without possibility of probation, early release or pardon. The court rejected Berger’s argument that his sentences violated the Eighth Amendment’s prohibition on cruel and unusual punishment, and an intermediate appellate court affirmed. The Arizona Supreme Court affirmed. According to the U.S. Supreme Court decision, Ewing v. California, 538 U.S. 11 (2003), noncapital sentences are subject only to a “narrow proportionality principle” that prohibits sentences that are “grossly disproportionate” to the crime. A prison sentence is not grossly disproportionate, and a court need not proceed beyond the threshold inquiry, if it arguably furthers the state’s penological goals and thus reflects “a rational legislative judgment, entitled to deference.” The court said that criminalizing possession of child pornography is tied directly to the fight against the sexual abuse and exploitation of children. The Legislature thus had a reasonable basis for the sentencing scheme, and a 10-year sentence is not grossly disproportionate to the crime of possessing each image. CRIMINAL PRACTICE Vindictive prosecution proof can’t annul verdict A presumption of prosecutorial vindictiveness does not apply to pretrial events, the 7th U.S. Circuit Court of Appeals held on May 9 on a matter of first impression. USA v. Jarrett, No. 05-2844. Jerry Jarrett, a criminal defense attorney, was tried and convicted for money laundering and illegally structuring financial transactions. He later moved to dismiss his indictment, relying on the Constitution’s prohibition against the government undertaking a prosecution based solely on a vindictive motive. His grand jury indictment took place four years after he first testified about the activities that ultimately led to his conviction. He argued that the federal government revived its prosecution of him after all that time because he had succeeded in getting state murder charges dismissed against a client named Bek who was the target of a highly publicized, joint federal-state investigation. Jarrett claimed that the government wanted to prevent him from representing Bek. An Indiana federal court found that Jarrett had proved vindictive prosecution. Applying a presumption of vindictiveness to events that took place before trial, the court vacated the jury verdict and dismissed the charges. The 7th Circuit reversed, and reinstated the jury’s verdict. The court said that prosecutors enjoy a “presumption of regularity” that is only overcome by clear evidence to the contrary. Other than the 4th Circuit, no appellate court has recognized any circumstances where a presumption of vindictiveness could be applied to events that took place before trial, and the court concluded that the district court had committed legal error when it applied such a presumption. EMPLOYMENT Negro League retirement plan isn’t Title VII breach A major league Baseball plan giving retirement benefits to black players excluded from the major leagues did not discriminate against white players, the 9th U.S. Circuit Court of Appeals held on May 9. Colbern v. Selig, No. 04-55647. In the 1990s, Major League Baseball (MLB)-in an attempt to address past discrimination-instituted a retirement plan for black players who played in the Negro Leagues, even if they did not have enough years of service to qualify for MLB’s retirement plan. Mike Colbern, a white former player, and others sued MLB, alleging that it discriminated against them due to their race in violation of Title VII of the 1964 Civil Rights Act by allowing the Negro League players into the retirement plan while not letting white players with similar years of service participate. A California federal district court granted summary judgment to Major League Baseball. Affirming, the 9th Circuit held that MLB did not violate Title VII because it had legitimate, nondiscriminatory, nonpretextual reasons for instituting the plan. The court said, “To the extent that MLB sought to remedy in part its past discriminatory conduct, it acted honorably and decently and not out of an improper or invidious motive. MLB has thus shown a legitimate, non-discriminatory reason for its decision to provide benefits to former Negro League Players, a reason that is not pretextual in any respect.” FAMILY LAW Legal father is essential party in paternity action A legal father is an indispensable party in paternity suits against alleged birth fathers, the Florida Supreme Court held on May 11. Florida Dep’t of Revenue v. Cummings, No. SC04-1045. The Florida Department of Revenue filed six paternity suits against alleged birth fathers. Although the mothers in each of the cases were married to other men at the time of the children’s birth, the department sued only the alleged birth fathers and not the legal fathers who were married to the mothers at the time of birth. A trial court dismissed all six complaints due to the state’s failure to make the legal fathers parties to the litigation because they were indispensable parties to the litigation. An intermediate appellate court affirmed, but its decision was at odds with another Florida intermediate appellate court. Affirming, the Florida Supreme Court held that because important rights of the legal fathers were at stake, they were indispensable parties to the litigation. Noting that the suits could result in the removal of the legal fathers from the children’s birth certificates, the court said, “[A] legal father’s material interests are necessarily impacted by these paternity actions as filed by the Department; therefore, he is an indispensable party.” Child-custody law can’t decide grandparent issue Montana’s Uniform Child Custody Jurisdiction and Enforcement Act (UCCJEA) does not govern matters relating to grandparent-grandchild contact proceedings, the Montana Supreme Court held on May 9 in an issue of first impression. In re the Grandparent-Grandchild Contact of Stewart v. Evans, No. 04-663. Dave Evans had full custody of his child, J.E. On July 24, 2002, a Montana trial court granted the petition for grandparent-grandchild contact of Pamela Stewart, J.E.’s maternal grandmother, under Mont. Code Ann. � 40, ch. 9. After Evans moved with J.E. to Kentucky, in January 2003 the trial court modified its July 2002 ruling and granted Stewart contact with J.E. every summer and over the holidays. Almost a year later, Evans filed an emergency motion to set aside the January 2003 order after discovering that J.E. had made statements to therapists regarding alleged abuse by Stewart. The trial court granted the emergency motion and held a hearing, where Evans argued that the UCCJEA did not apply to Stewart’s petition because grandparent-grandchild contact proceedings did not fall under its jurisdiction. The trial court retained jurisdiction and ordered a parenting evaluation be completed in Montana. The Montana Supreme Court affirmed in part and remanded. Mont. Code Ann. � 40-7-202(1) states that the UCCJEA has continuing jurisdiction over child-custody proceedings, listing “child,” “parent,” and “person acting as a parent” as the relevant parties, with no mention of a grandparent. While the lower court had no authority to retain jurisdiction over Stewart’s petition under the UCCJEA, it could exercise jurisdiction over the petition under the general law governing subject-matter jurisdiction. HEALTH LAW State agency may look at peer-review records The Federal Protection and Advocacy for Individuals with Mental Illness Act (PAIMIA) grants state protection and advocacy agencies the right to access state hospital peer review records, the 2d U.S. Circuit Court of Appeals ruled on May 5. Protection & Advocacy for Persons with Disabilities v. Mental Health & Addiction Services, No. 05-1457. During an investigation by the Connecticut Office of Protection and Advocacy for Persons with Disabilities (OPA) into the deaths of two patients at two state-run mental hospitals, the hospitals released all records related to the patients’ cases except for the hospital staff peer-review records evaluating the quality and efficiency of the services provided by other health care professionals. The Connecticut Department of Mental Health and Addiction Services withheld the records, claiming that peer-review documents are privileged under Connecticut law. The OPA filed suit in a Connecticut federal court, seeking a declaration that it is entitled to see the peer-review records under PAIMIA. The department claimed PAIMIA was pre-empted by U.S. Department of Health and Human Services regulations, which say that a protection and advocacy agency may receive all records, including peer-review reports, unless release of such records would violate state record-protection laws. The court granted the OPA’s motion for summary judgment. The 2d Circuit affirmed. Granting access to peer-review records during the course of the OPA’s investigation, as opposed to releasing the records for use in civil litigation, does not conflict with Connecticut’s general peer-review privilege. The court noted that PAIMIA requires the OPA and other protection and advocacy agencies to keep records confidential to the same extent that a health care provider normally would. TAXATION Slot machine gambling can constitute a trade A taxpayer’s slot machine gambling constituted a trade or business, entitling him to list gambling losses as business losses, the Minnesota Supreme Court ruled on May 11. Busch v. Commissioner of Revenue, No. A05-656. Upon retiring in 1999, Estelle Busch began playing slot machines on a full-time basis. She won $79,482 in 1999, $430,280 in 2000 and $972,980 in 2001, but also claimed $79,482 in losses in 1999, $430,280 in 2000, and $1,161,824 in 2001. At first, Busch deducted her 1999 and 2000 gambling losses as itemized deductions. Then in 2001, she claimed her gambling losses as a trade or business expense and subsequently amended her 2000 tax return to claim her gambling losses that year in the same manner. The Minnesota Department of Revenue audited Busch’s tax returns for 1999, 2000 and 2001 and assessed a total of $102,245 in additional taxes, plus interest, based on the fact that her gambling losses were not a trade or business expense. The Minnesota Tax Court affirmed, holding that Busch had to have a reasonable expectation of profit from her gambling activity for the activity to qualify as a trade or business. However, Busch lost money steadily for three years. Reversing, the Minnesota Supreme Court held that slot machine gambling may constitute a trade or a business for purposes of assessing her Minnesota tax liability. The court said it is difficult to know in advance which business activities have a reasonable expectation of profit and which do not. Thus a taxpayer’s expectation of profit from a given activity need not always be reasonable for the activity to qualify as a trade or business. The court pointed to factors such as the full-time nature of Busch’s activity, her attempts to improve her skill by reading articles about the use of slot machines, her keeping of detailed, businesslike records of her winnings and losses, and her intention to make a profit through her activity.

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