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In any given year, some of the biggest victories in civil cases go to the defendants. But few of them reach the headlines. A $10 million jury award generally gets more attention than a $100 million verdict averted. Yet the lawyering involved in thwarting efforts to recover substantial judgments is often equal to the level of ability, exertion and creativity shown by the plaintiffs’ attorneys who win the big ones. At times, the obstacles to winning are even greater for the defense lawyers. “It’s a whole lot easier to throw a skunk in a room than to clean up the mess,” says William Slusser of Houston’s Slusser & Frost. For 11 years, The National Law Journalhas attempted to shine a spotlight on the usually unheralded efforts of the nation’s defense litigators by publishing a list of the top defense verdicts for the year. This year, as in the past, the lawyers who won these cases prevailed despite substantial hurdles. In Minnesota, Koch Refining Co. won a wrongful-termination case brought by a whistleblower, even though the company fired the plaintiff after he reported charges of environmental violations against Koch that resulted in nearly $14 million in fines against the company. In Oklahoma, Freightliner Corp. won complete exoneration in a products- liability action brought by a truck driver who was rendered quadriplegic in a truck rollover, even though the plaintiff’s attorney built a massive, costly device to prove how the plaintiff was hurt and the case was tried under Oklahoma law, which would have granted full damages if the defendant were assigned any portion of fault. This list of the biggest defense wins of the year 2000 is necessarily subjective. Plaintiffs’ verdicts are more easily ranked — biggest is biggest. But the best defense wins are, on the surface, identical: no liability and no damages. To assess the worth of defense wins, we have set out several criteria: � The list includes only jury verdicts. No summary dismissals or bench trials are included. (This year, however, we are including a separate report on summary judgments for defendants in 2000.) � The amount at risk must be substantial. The demand for damages has to have some measure of reality. � The win must be complete. Moral victories, such as a plaintiff seeking millions but winning only a few thousand, do not count. � The jury’s decision must still be valid, with no reversals or remands for new trials, though cases that have since been settled are acceptable. � The plaintiff should have had a reasonable chance of winning, as indicated by the settlement by a co-defendant, the defense offer of a substantial settlement before the verdict, previous plaintiffs’ wins in similar cases or the representation for the plaintiff by highly regarded counsel. The top defense win in 2000 — a victory for Peat Marwick in the professional negligence action brought by The Common Fund for Non-Profit Organizations — appears in a separate story. The rest of the top defense wins for 2000 appear here. TAPE RECORDINGS SINK A WHISTLEBLOWER CASE CASE TYPE:Wrongful termination, violation of whistleblower statute case: Chadwell v. Koch Refining Co., No. 98-761 (D. Minn) PLAINTIFF’S ATTORNEYS:Jeffrey Anderson, Joanne Mullen and Harvey Eckart of St. Paul, Minn.’s Reinhardt & Anderson DEFENSE ATTORNEYS:Jerry W. Snider, Charles F. Webber and Deborah A. Ellingboe of Minneapolis’ Faegre & Benson; Mark Holden, in-house litigation counsel, Koch Industries Inc. DATE OF VERDICT:Jan. 19, 2000 Charles Chadwell, an operator at the Koch Refining Co.’s Pinebend wastewater treatment plant in Rosemont, Minn., reported environmental violations by Koch to the Minnesota Pollution Control Agency in April 1997. Chadwell also reported to the U.S. Environmental Protection Agency his accusations that Koch was illegally discharging ammonia into the environment. Koch ultimately pleaded guilty to violations of federal pollution standards and paid a fine of more than $7 million, said defense counsel Charles F. Webber. In December 1997, Chadwell was fired from Koch. He sued the company, contending that he had been fired in retaliation for reporting the environmental violations, said plaintiff’s attorney Jeffrey Anderson. The firing looked bad, Webber conceded. Anytime a whistleblower’s employment is terminated, retaliation seems an obvious charge. “The big key to winning is that we didn’t put up a fight on the environmental issues, because we couldn’t,” said Webber. “We told the jury straight up, ‘We violated the law. We paid the price and we’re fixing it.’ Chadwell hoped to try an environmental case. We showed up to try a whistleblower case.” To that end, Koch’s attorneys detailed the company’s response to the environmental charges, using the plaintiff’s own government witnesses to testify to Koch’s cooperation with the investigation, he said. This defused the plaintiff’s charges that Koch was an environmental outlaw. Koch also neutralized the retaliation charges by meeting them directly. Koch contended, Webber said, that it was contrary to the company’s policy to fire environmental whistleblowers. “Koch had no problem with his making these allegations. That was his job, to report environmental issues. If he couldn’t get satisfaction from his superiors, he had to take it higher.” Instead, he said, Chadwell “was fired because he was a disruptive force in the workplace. He began violating company rules from the time he told Koch that he reported the company to the MPCA,” Webber said. “Chadwell did not cooperate with Koch’s investigation of his pollution allegations.” Koch also alleged that Chadwell removed documents from the company, though he returned them. “He was just someone using the whistleblower law to get a payout,” Webber said. Charging that Chadwell was trying to get fired “was a risky strategy,” he noted, “but we had the evidence.” Prior to the firing, Chadwell had begun tape-recording his conversations with Koch management as a way of keeping a record. “He was being harassed and retaliated against and was concerned that [members of Koch management] were following him,” said Anderson. Koch was unaware of the tape recordings, but during discovery, said Koch in-house counsel Mark Holden, “we asked the standard question, for diaries and notebooks concerning your claims, but expanded it to tape recordings.” Another whistleblower had brought a cassette recorder to a meeting with Koch management. “That gave us a clue that maybe there were some tapes out there.” These tapes would backfire on Chadwell, Webber said. For on the tapes, Chadwell told others that he wanted to get fired, he said. At trial, Webber noted, Chadwell “tried to explain that he wanted to be fired by that point, because his life was a living hell. But he said he wanted to be fired — on tape — before this supposed retaliation started.” Chadwell was seeking more than $2 million in compensatory damages and was expecting to ask for millions more in a punitive damages phase. On Jan. 19, a Minneapolis jury found no liability. The plaintiff’s post-trial motion for a new trial was subsequently denied; his appeal is pending. A CASE THAT BECAME A TEST OF ‘DUELING ROLLOVERS’ CASE TYPE:Products liability CASE: Hooley v. Freightliner Corp., Civ., No. 98-1039 R (W.D. Okla.) PLAINTIFF’S ATTORNEY:John M. Merritt of Oklahoma City’s Merritt & Associates DEFENSE ATTORNEYS:Dale Markland of the Dallas office of Houston’s Vinson & Elkins; and Rodney Cook of Oklahoma City’s Holloway, Dobson, Hudson, Bachman, Alden, Jennings & Holloway DATE OF VERDICT:Feb. 2, 2000 In April 1997, Ralph Hooley was driving a heavy truck manufactured by Freightliner Corp. in rural Sumner County, Kan., when he swerved to avoid an oncoming car. When he attempted to get the tractor-trailer back on the highway, he lost control and rolled over. Hooley was rendered quadriplegic. Hooley sued Freightliner, charging that the seat belt in the truck was defectively designed, causing him to slip out of the belt and hit his head. The plaintiff also charged that the roof of the truck’s cab and the pillars that support the roof were not designed to withstand the force of accidents, particularly rollovers. The Freightliner truck was equipped with an air-ride seat, which goes up and down as the truck bounces, said defense attorney Dale Markland. The plaintiff contended that as the seat bottom moved to its top position, it created slack in the upper part of the seat belt. This, in turn, through the pass-through latch plate of the belt, created slack in the lower part of the belt. During the rollover, the seat moved toward the roof, creating slack in the upper and lower parts of the belt. The plaintiff claimed that the belt did not sufficiently restrain him. At the same time, as his head came over, the cab crushed in during the rollover, according to the plaintiff. Freightliner denied any defects, contending that Hooley had not been wearing his seat belt and that the force of the accident caused his injuries. The plaintiff contended that Hooley had been wearing his seat belt and that there were scuff marks on the belt to prove this, but that the belt’s retractor was defective and didn’t lock up and hold Hooley in place. The trial would become a contest of dueling rollover tests. “The plaintiff’s [lawyer] had created a one-of-a-kind heavy truck rollover test device,” Markland said. During tests for the trial, the plaintiff’s team had expert drivers put a heavy truck cab into a rollover to show how a person would move inside the truck. The plaintiff’s team filmed the tests at different angles, Markland said. The contention was that Hooley’s head moved toward the wall of the cab and, in the tests, the drivers’ bodies moved as expected by the plaintiff’s counsel, Markland said. But, he added, “there were two basic flaws in the tests. It was a static device, it didn’t input road vibration,” or the speed of the truck during the rollover. “And the drivers were using their best efforts trying to get out of the seat belt.” The defense attacked the plaintiff’s tests directly — with its own set of tests. The defense produced tests of slow rollovers, to show how the body is jammed into the vehicle by the seat belt during an accident. Freightliner also conducted high-speed rollover tests with Indiana Mills, the truck maker’s supplier of seat belts. These tests were conducted with dummies, Markland said, and would prove crucial in confronting the plaintiff’s contention that the truck’s seat belt system failed. The witnesses who first arrived on the scene of the accident said they didn’t see a seat belt on Hooley, Markland noted. “We tried to recreate Mr. Hooley’s accident, to determine what marks should have been left on the seat belt,” he said. “This had never been done before in a side rollover.” The rollover left distinct impressions on two plastic pieces of the belt system, the d-ring on the upper left side of the door and the pass-through latch plate. “The seat belt from his accident had none of these marks.” The plaintiff, he added, “pointed to scuff marks on the belt,” as proof that the belt had “moved through the pass-through latch plate and created more slack. Our position was that these were simple wear marks, from everyday usage as the truck goes up and down the road.” The defense again turned to its tests; there were no scuff marks on the belts of the trucks used in the rollover tests. The plaintiff was seeking $160 million in compensatory and punitive damages. Under Oklahoma products liability law, Markland noted, had the jury found that a defective design was “in the slightest bit contributory to the plaintiff’s injury, then the product manufacturer is liable for all of the damages.” But, on Feb. 2, an Oklahoma jury found no defects and no liability. There was no appeal. A PIRATING CONSPIRACY THEORY IS SUNK CASE TYPE:Tortious interference, breach of fiduciary duty, conspiracy case: Avnet Inc. v. Wyle Laboratories, No. 93-4396-D (Hillsborough Co., Fla., Cir. Ct.) PLAINTIFF’S ATTORNEYS:Benjamin H. Hill III and David L. Kian of Tampa, Fla.’s Hill, Ward & Henderson; and Roger L. Longtin, Stephen L. Agin, Lawrence A. Wojcikand, Sonya D. Naar of the Chicago office of Piper Marbury Rudnick & Wolfe DEFENSE ATTORNEYS:Emmet J. Bondurant and P. Richard Game of Atlanta’s Bondurant, Mixson & Elmore; and John E. Johnson and William H. Harrell of Tampa’s Trenam, Kemker, Scharf, Barkin, Frye, O’Neill & Mullis DATE OF VERDICT:Feb. 4, 2000 In April 1993, Avnet Inc., the nation’s largest electronics distributor, purchased Dallas-based Hall-Mark Electronics Corp., then the No. 3 electronics distributor, said defense counsel Emmet J. Bondurant. Within three weeks of this acquisition, 78 Hall-Mark employees left that company and went to work for Wyle Laboratories Inc., which at the time was the No. 8 electronics distributor in the United States, he said. Avnet quickly sued eight of these former Hall-Mark employees and Wyle as well, charging, among other things, a conspiracy between these employees and Wyle to spirit off the Hall-Mark workers and, subsequently, Hall-Mark customers. At the center of Avnet’s conspiracy theory, Bondurant said, were “notes made by a Wyle human resources employee, handwritten on a typed memorandum, which Avnet characterized as the minutes of a Wyle strategy meeting, in which Wyle allegedly hatched its plan to pirate away Hall-Mark’s employees.” The typed memorandum, he added, “stated that Jim Haraway, a Hall-Mark senior vice president who joined Wyle, hope[d] to close on at least five managers within Hall-Mark and feels each can bring about 10 good people with them.” Wyle’s director of human resources placed the following handwritten notes on the memorandum to his superior, which read: “Raid. Dangerous! — I see potential problems with these notes — Can we retract?” “Avnet bolstered its conspiracy theory by pointing to thousands of telephone records reflecting repeated calls between Haraway and the managers who worked for him at Hall-Mark, and between managers and salespeople in nine of Hall-Mark’s branch offices,” Bondurant said. The defense set several basic themes: there was no conspiracy; there was no interference with the employer/employee relationships; the individual managers who came to Wyle and recruited former coworkers violated no duties of loyalty to Avnet or Hall-Mark; and the Hall-Mark employees left because they didn’t want to work for Avnet. The Wyle defense attorneys concentrated much of their time countering the effect of the memorandum and the notes, he reported. “Wyle argued that by the time of the meeting recorded in the ‘raid’ memorandum, Haraway had already accepted a job with Wyle, and therefore, owed no duties of loyalty to Hall-Mark at all and could freely solicit former Hall-Mark branch managers to join Wyle.” The memo, he said, “was simply recording Haraway’s post-resignation plans to solicit his former subordinates at Hall-Mark, all of which was perfectly legal.” The handwritten notes, while apparently damaging, Bondurant said, “were made by an employee who was simply misinformed as to the legality of Haraway’s plans after joining Wyle.” The employee, he said, didn’t realize “that recruiting from another company is not in fact a tort.” The telephone calls back and forth between Hall-Mark branch managers and their subordinates “were the natural and expected consequence of a merger announcement.” When Haraway and the other managers offered jobs to Hall-Mark employees, he added, this was not evidence of disloyalty toward Hall-Mark, but of loyalty to their subordinates, in insuring they would have work following the merger. The defense also concentrated on showing the Hall-Mark employees’ pre-acquisition opinions of the acquiring company to prove a primary point — that Wyle did not have to conspire to pirate away any Hall-Mark employees; the employees should have been expected to leave. “They thought Avnet was the Darth Vader of the industry. These people didn’t want to work for Avnet.” Avnet contended that the loss of Hall-Mark employees “essentially destroyed 25 percent of the value of Hall-Mark,” Bondurant added, and sought $154 million in compensatory damages. But on Feb. 4, 2000, a Tampa, Fla., jury rejected all the plaintiff’s claims. There was no appeal. EGG-SORTING PATENT FEUD GETS SORTED OUT BY DEFENSE CASE TYPE:Patent infringement CASE: Moba B.V. v. Diamond Automation Inc., No. 95-CV02631 (E.D. Pa.) PLAINTIFF’S ATTORNEYS:Jon Baughman, Erik Videlock and Nicole Galli of Philadelphia’s Pepper Hamilton; and Marvin Petry of Alexandria, Va.’s Larson & Taylor DEFENSE ATTORNEYS:Albert Breneisen, John Bateman and Sheila Mortazavi of New York’s Kenyon & Kenyon DATE OF VERDICT:Feb. 25, 2000 This is listed as a defense verdict even though the original plaintiffs, Moba B.V., Staalkat B.V. and FPS Inc. won the case. The defendant, Diamond Automation Inc., had sued Moba and its cohorts in Michigan, charging infringement on four Diamond patents for egg-sorting machinery. This was dismissed on jurisdictional grounds and Moba won a race to the courthouse in Pennsylvania, filing a declaratory judgment action against Diamond seeking a ruling of non-infringement. Diamond then counterclaimed, suing these companies for patent infringement. Diamond claimed that not only did the Moba and Staalkat machines infringe on the Diamond patents, but that the companies “induced customers to infringe,” said Diamond attorney Albert Breneisen. Diamond had applied for its patents covering high-speed egg-sorting machines in the early 1980s, noted Moba attorney Jon Baughman. These machines, he said, wash the eggs, check them for cracks, weigh them, sort them and put them in cartons. The machines use an overhead conveyer belt, which transports the eggs and drops them off at stations, to be cartoned by weight. Diamond had the fastest machines; each machine could sort one million eggs per day, Baughman said. Moba and Staalkat, both subsidiaries of the Dutch company FPS Food Processing Systems B.V., were the major competitors in building egg-sorting machines. In the early 1990s, he added, Moba and Staalkat came up with faster machines of their own. Diamond claimed these machines infringed on the Diamond patents. Before the trial, Baughman said, the Markman hearings had gone against the Dutch companies. Moba and Staalkat were also facing other obstacles, he said. “We were the alleged infringer. We were the foreigners. They were claiming they made a vast improvement in the technology and that we stole it. “Our counter was that if anyone was the innovator in this industry that it was these two companies,” he said. The attorneys brought in individuals from the Dutch companies who developed the Moba and Staalkat machines, “to see that these are real people … not just foreigners” trying to steal jobs. As much as possible, however, the Moba/Staalkat team tried to prove its points through the Diamond witnesses. The Moba/Staalkat attorneys, Baughman said, tried to draw distinct differences between the machines. “They developed an inner level transfer to carry the eggs down. They dropped the eggs into big brushes to carry them down. But we didn’t use this transfer. We just softened the conveyer belt by putting brushes on it.” In the cross-examination of the inventor, he said, the focus was on the dropping of eggs and brushes used to protect the eggs as they were moved and dropped. “Their inventor mentioned that they had tried to drop eggs without brushes and they bounced. This was good news for us, because they tried to do what we did.” Ultimately, he said, “their inventor had to admit that what we had done before was close to their claims.” The standard defense in a patent infringement action is complex. The alleged infringer claims that the patent was not infringed. If it was infringed, the infringement was not willful; and even if there was infringement, the infringement is unimportant, because the patent or patents are invalid. The Moba/Staalkat attorneys, however, did not push this latter point. From the very beginning, Baughman said, “we told the jury we were not trying to invalidate these patents. We asked the jury not to address invalidity, unless they found infringement.” Then, only if the jury found infringement, he said, “they should look at what we were doing before. Look at our old machines.” On Feb. 25, 2000, the Philadelphia jury found no infringement on all four patents. Because the jury found no infringement, it did not consider the validity question. Diamond Automation has appealed. Defense Verdicts of the Year, Part II

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