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CIVIL PRACTICE No state pre-emption of local seizure ordinance Reversing a state intermediate appellate court, the Florida Supreme Court held on July 6 that Florida’s civil forfeiture law did not pre-empt a municipal ordinance providing for seizure of a vehicle used in the solicitation of prostitution. City of Hollywood v. Mulligan, No. SC04-990. Colon Mulligan was convicted of soliciting prostitution, and pursuant to a city of Hollywood ordinance his automobile was impounded because the offense occurred as he operated his vehicle. Mulligan filed suit and was named class representative in a class action. A trial court granted summary judgment to the city, but an intermediate state appellate court reversed, holding that Hollywood’s ordinance was pre-empted by the Florida Contraband Forfeiture Act (FCFA), Fla. Stat. � 932.701-.707 (2002). Reversing, the state Supreme Court cautioned against potential constitutional infirmities but held that FCFA did not pre-empt or conflict with the Hollywood ordinance. “Not only does the FCFA policy statement not express an intent to preempt the entire field of seizures and forfeitures for nonfelony offenses, it neither expressly nor impliedly preempts the field of seizures and forfeitures for vehicles,” the Supreme Court said.   Full text of the decision Censorious dunning letter deemed actionable A debt-collection letter that implied the writer of a bounced check was “dishonest” may give rise to liability under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692 et seq, the 7th Circuit U.S. Court of Appeals held by a 2-1 vote on July 7. McMillan v. Collection Professionals Inc., No. 05-2745. April McMillan received a collection letter from Collection Professionals Inc. (CPI) demanding payment for a dishonored check for $86.43 plus $145.05 in unspecified “previous debts.” The letter said, among other things, “You are either honest or dishonest you cannot be both,” and that the “injustice of permitting this account to become past due and then ignoring all requests for payment, casts a doubt of good intentions.” McMillan alleged the letter used false, deceptive or misleading representations or means; was an attempt to disgrace her; and employed unfair or unconscionable means to collect a debt, all violations of the law. CPI argued the language was true and accurate and did not state or imply that she had committed a crime or other fraud. An Illinois federal district court held that she failed to state a claim upon which relief could be granted. The 7th Circuit reversed, saying the issue was how an unsophisticated consumer would perceive such language. Such a case should not be dismissed if it is “possible to imagine evidence” that would support the allegations. The majority noted there are a variety of honest reasons why a check might bounce, but that there was no evidence in the record explaining the bounced check in this case, nor of any earlier requests for payment that McMillan had ignored. Therefore, the majority continued, the accusation of “injustice” might well be false. CRIMINAL PRACTICE Warrant citing sealed affidavit is sustained As long as a search warrant is supported by an affidavit that describes with particularity the “persons or property to be seized” at the time the warrant is issued, the affidavit need not be available for inspection when it is executed, a divided 6th U.S. Circuit Court of Appeals, sitting en banc, ruled on July 3. Baranski v. Fifteen Unknown Agents of the Bureau of Alcohol, Tobacco and Firearms, nos. 03-5582 and 03-5614. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) agents investigating weapons dealer Keith Baranski for illegal importation of machine guns sought a warrant to search the warehouse where he stored the guns. The warrant application did not describe the items sought or cite probable cause, but instead referred to an attached affidavit that did. The magistrate approved the warrant, simultaneously sealing the affidavit to protect the ATF’s confidential sources. Agents recovered numerous machine guns and accessories belonging to Baranski during the search. Baranski sued the ATF, alleging Fourth Amendment violations. A federal district court stayed the civil action pending the outcome of the criminal case, in which Baranski was convicted. A federal district judge in Kentucky then granted the agents’ claim for qualified immunity. A panel of the 6th Circuit reversed, relying on the 2004 U.S. Supreme Court decision in Groh v. Ramirez, 540 U.S. 551 (2004). The full 6th Circuit affirmed the district court, saying Groh did not apply because the warrant criticized in that case did not even cross-reference a supporting affidavit. Here, the warrant satisfied the particularity requirements because the items to be seized were properly described in the supporting affidavit. FAMILY LAW Military allowances count toward support In an issue of first impression, the Louisiana Supreme Court ruled on July 6 that military allowances for housing and other purposes must be included in gross income for the calculation of child support obligations. In the Interest of D.F., No. 05-CJ-1965. Legredis Taylor, a U.S. Navy officer, is the father of six children, including two minors, identified in court records as D.F. and J.T. Their mothers sought child support through the Louisiana Department of Social Services. A state hearing officer determined Taylor’s support obligation by including in his gross income his military allowances for housing and other subsistence support. The trial judge determined that the allowances should not be included in income in calculating child support. The state Court of Appeal affirmed. The state law at issue defines gross income as coming from any source, including expense reimbursements or in-kind payments that “include but are not limited to a company car, free housing, or reimbursed meals.” Reversing and remanding, the Louisiana Supreme Court concluded that this nonexclusive definition encompassed the military allowances. The court noted that its conclusion was in keeping with the intent of Louisiana’s child support guidelines, which is to ensure that a child receives the same proportion of parental income that he or she would have received if the parents lived together. IMMIGRATION LAW Cocaine conviction trumps wartime service A previously lawful permanent U.S. resident who was a Vietnam veteran became ineligible for naturalization upon his conviction for a drug crime that precludes proving “good moral character,” the 7th U.S. Circuit Court of Appeals held on July 6 in a matter of first impression. O’Sullivan v. U.S. Citizenship & Immigration Services, No. 05-2943. Daniel O’Sullivan, a Jamaica native, became a lawful permanent resident of the United States as a child and later served honorably in the Vietnam War. Years later, he was convicted of distributing cocaine, an aggravated felony. An immigration statute bars aggravated felons from being deemed to have “good moral character.” During O’Sullivan’s prison term, the government began removal proceedings and O’Sullivan petitioned for naturalization, relying on the Immigration and Naturalization Act, 8 U.S.C. 1440, which, in conjunction with � 1429, allows noncitizens who served in the U.S. military during designated wartimes to naturalize. The government denied his petition on the ground that his conviction precluded the good-character showing. He argued that wartime veterans need not prove good moral character to be naturalized, or at least are not barred from doing so even with such a conviction. An Illinois federal district court affirmed the denial. The 7th Circuit affirmed, agreeing with circuits that have addressed similar issues. The court rejected O’Sullivan’s argument that the “good moral character” language was a subset of the residency requirement for naturalization and can be waived for war veterans. Notwithstanding any wartime service, applicants for naturalization must establish that they remain of good moral character, the court said. INTERNATIONAL LAW Courts lack jurisdiction in factory expropriation U.S. courts lacked jurisdiction in a dispute over the expropriation of an auto plant by a Chinese provincial government because the action did not fall under the commercial-activity exception of the Foreign Sovereign Immunities Act (FSIA), the U.S. Court of Appeals for the D.C. Circuit held on July 7. Rong v. Liaoning Province Govt., No. 05-7030. Yang Rong, a Chinese national and permanent resident of the United States, owned shares in the Chinese Financial Educational Development Foundation, which owned Brilliance Holdings, an automobile manufacturer listed on the New York Stock Exchange. His business partner was the municipality of Shen Yang, a city in the Liaoning province in northeast China. The provincial government declared the foundation to be a state asset in 2002 and expropriated Rong’s shares. Rong sued in U.S. district court in Washington, citing the commercial activity exemption under FSIA. The district court judge dismissed for lack of jurisdiction. Affirming, the D.C. Circuit said that suit under FSIA was allowed only if an overseas government acted as a private actor. Here, the expropriation “constituted a quintessentially sovereign act, not a corporate takeover,” the court said. “If Rong’s interpretation of commercial activity were correct, then almost any subsequent disposition of expropriated property could allow the sovereign to be hauled into court under FSIA. Such a result is inconsistent with our precedent, the decisions of other circuits and the Act’s purpose.” SOCIAL SERVICES LAW Win on remand merits attorney fee award Social security claimants whose path to receiving benefits wends through a federal court are entitled to recover their attorney fees, the 11th U.S. Circuit Court of Appeals ruled on July 6. Bergen v. Commissioner of Social Security, No. 05-14683. Two claimants filed separate applications for disability benefits with the Social Security Administration but were refused benefits at the agency level and by an administrative law judge. An attorney agreed to represent them under a contingency fee arrangement. Each claimant prevailed before a U.S. district court judge in Florida and ultimately secured future and past-due benefits on remand, but the court refused to award attorney fees. The consolidated appeal turned on 42 U.S.C. 406(b)(1)(A), which provides that attorney fees may be awarded in such cases “[w]henever a court renders a judgment favorable to a claimant under this subchapter.” The 11th Circuit concluded that the congressional intent was to encourage effective legal representation for claimants by ensuring that their lawyers receive reasonable fees. Reading the statute literally and limiting attorney fees to situations in which the court itself awards benefits would frustrate that congressional intent, the circuit court said. TORTS Whistleblower shield doesn’t cover directors A director-shareholder of a corporation cannot bring suit under the Conscientious Employee Protection Act when her power and influence is comparable to fellow director-shareholders, the New Jersey Supreme Court ruled on July 5. Feldman v. Hunterdon Radiological Associates, No. A-71-05. In 2000, as chairwoman of medical imaging at Hunterdon Radiological Associates (HRA), Dr. Ruth Feldman tried to persuade her fellow shareholder-directors that the quality of X-ray readings by another physician at the facility was substandard. Her colleagues decided not to take action against the physician. Feldman left HRA and eventually sued the company under CEPA. HRA moved for summary judgment on the ground that Feldman could not be an “employee” entitled to the protections of CEPA. Feldman maintained that she was indeed an “employee” who had been constructively discharged for blowing the whistle on the other physician. The trial court granted HRA’s motion, but an intermediate appeals court reversed, agreeing that Feldman was an “employee” under CEPA. Reversing, the New Jersey Supreme Court said the issue was not whether a plaintiff’s status as a director-shareholder also made her an employee, but rather the nature of her relationship with the corporation. Trial courts should examine whether the plaintiff holds power and influence within the organization. In this case, Feldman possessed an equal vote and voice in all matters, and her inability to persuade her fellow director-shareholders did not somehow transform her relationship to the group to one of employee-employer. Feldman was not an employee or a member of a vulnerable class of people CEPA was designed to protect. Assumption of risk assumes free choice The assumption-of-risk defense is not available when the plaintiff had no alternative to the risky behavior, the Nebraska Supreme Court found on July 7. Pachunka v. Rogers Construction Inc., No. S-04-1470. Jerry Pachunka was a real estate agent showing model houses built by the defendant. He slipped and fell while exiting a house via a board ramp placed between the muddy ground and a stoop about 16 inches above grade. There was another entrance through the garage but he had not been given the key, and a back injury prevented him from simply climbing the stoop. He sued for negligence. The judge allowed the defense to argue that Pachunka willingly undertook the risk of climbing the ramp, and the jury returned a defense verdict. The state Supreme Court reversed and remanded. “We conclude that the trial court erred by submitting the defense of assumption of risk to the jury where the evidence did not establish that the risk was voluntarily assumed,” the court said. “We similarly conclude that the court erred by instructing the jury on the issue.” Intentionally placed clip ruled actionable A surgical clip left intentionally but negligently in a patient’s body is a “foreign object” for purposes of the Tennessee medical malpractice statute, thus triggering exceptions to the statute’s usual limitations and repose periods, the Tennessee Supreme Court ruled on July 3. Chambers v. Semmer, No. E2005-01519-SC-S09-CV. In December 1997, during surgery to remove a female patient’s suspicious pelvic mass, her surgeons applied hemostatic clips to control bleeding but believed they’d removed them all. Medical tests in January 2002 revealed that the woman’s left kidney was not functioning. According to the patient’s expert witness, the problem was caused by a clip negligently applied to her left ureter and not removed. A state trial judge denied the surgeons’ motion for summary judgment, which was based on their argument that the suit was barred either by the one-year statute of limitations or the three-year statute of repose. The Tennessee Supreme Court affirmed, citing an exception to the statutes of limitation and repose when a foreign object has been negligently left in a patient’s body. The court distinguished between objects like clips, stents, pacemakers and implants that are intended to remain within the patient’s body for therapeutic purposes. Multiple caps boost noneconomic damages Noneconomic damages caps do not apply collectively to all predeath and post-death noneconomic damages suffered by a medical malpractice victim and her survivors, a plurality of the Wisconsin Supreme Court held on July 7, overturning its own precedent to the contrary. Bartholemew v. Wisconsin Patients Compensation Fund, No. 2004AP2592. Helen Bartholemew died due to medical malpractice. Her husband, Robert, sued individually and as her estate’s administrator. A state trial jury awarded the estate $500,000 for her predeath pain and suffering; awarded Robert $350,000 in noneconomic damages for his predeath loss of his wife’s society and companionship; and awarded him $350,000 for his post-death loss of society and companionship. The trial judge limited all the noneconomic damages to $350,000, applying Maurin v. Hall, 2004 WI 100, which had held that when a medical malpractice victim dies, the cap for wrongful death actions limits all noneconomic damages. An intermediate state appellate court affirmed. In a lead opinion and a series of concurring and/or dissenting opinions, the Wisconsin Supreme Court reversed and reinstated all three jury awards. It held there are two caps: a medical malpractice cap for noneconomic damages for predeath claims, and a wrongful death cap for noneconomic damages for predeath loss of society and companionship. “Claimants can thus recover for the different damages up to the separate limits of the applicable respective cap,” the lead opinion said, overturning the inconsistent parts of Maurin. The court held that the award for Helen’s predeath pain and suffering, as well as Robert’s award for predeath loss of society and companionship, were governed by the medical malpractice statutes. The court pointed to Ferdon v. Wisconsin Patients Compensation Fund, 2005 WI 125, decided after the jury verdict, which declared Wisconsin’s medical malpractice cap unconstitutional. Robert’s award for post-death damages stands, as within the wrongful death cap.

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