Utah Supreme Court Upholds Constitutionality of Products Liability Statute

The Utah Supreme Court issued Egbert v. Nissan (“Egbert II”) in which it has expressly held:

1) The rebuttable presumption of non-defectiveness in product liability cases is constitutional and has been effective in Utah for more than 20 years; and

2) Restatement (Third) Torts section 16(b-d) regarding enhanced injury claims is rejected.  An “enhanced injury occurs when an injury caused by some other event is increased or enhanced due to a defective product.”  The Court found an inherent conflict between the restatement and Utah’s long-standing abolishment of joint and several liability and adoption of apportionment of fault.

Failure to Issue “Litigation Hold” Could Result in Sanctions and Attorney’s Fees

The recent S.D.N.Y. decision in Pension Committee of the Univ. of Montreal Pension Plan v. Banc of America Securities, 05 Civ. 9016, 2010 U.S. Dist. LEXIS 1839, *1 (S.D.N.Y. Jan. 11, 2010, and amended, Jan. 15, 2010), highlights that litigation requires more than simply responding to discovery once it is initiated by a formal request.  In this case, the plaintiffs failed to anticipate and issue within its company a litigation hold to preserve and collect all reasonably relevant documents.  The plaintiffs waited nearly two years before initiating a written litigation hold.

The court was clear that “the failure to issue a written litigation hold constitutes gross negligence because that failure is likely to result in the destruction of relevant information.”  The court found that a litigation hold should “direct employees to preserve all relevant documents —both paper and electronic” and “create a mechanism for collecting the preserved records so that they can be searched by someone other than the employee . . . .”  The court also found that collection efforts do not “require hands-on supervision from an attorney. However, attorney oversight of the
process, including the ability to review, sample, or spot-check the collection efforts is important. The adequacy of each search must be evaluated on a case by case basis.”

Here are some practice pointers offered by Orrick:

*  “[O]nce a party reasonably anticipates litigation, it must suspend its routine document retention/destruction policy and put in place a ‘litigation hold’ to ensure the preservation of relevant documents.”

*  Employers should consider whether they have an obligation to preserve, search and collect information on an employee’s home computer or mobile personal device.

*  Once the duty to preserve is triggered: 1) suspend auto-deletion of ESI; 2) ensure preservation efforts account for departed employees; and 3) take steps to ensure preservation of relevant information under the litigating party’s control but in the custody of third parties.

*  Custodian self-collection can be defensible with the appropriate supervision by counsel. To ensure defensibility, it is important to understand the technology and process used for collection, document actions and decisions, and sample custodian self-collection.

*  Collection instructions should be in writing and technical support should be available to the custodian.

*  If relying on custodian self-collection, instructions to individual employees should include a broad description of “relevant documents.” As much as possible, avoid asking the employee to make relevancy determinations.

*  Any proffer of eDiscovery evidence should be specific and accurate. Whether arguing for cost shifting or presenting evidence of the reasonableness of preservation or collection, it is essential that the statements have specificity. Cursory summaries of IT infrastructure, scope of collection and preservation or cost will inevitably lead to problems. To support these detailed evidentiary offerings, it is important to document decisions and actions throughout the eDiscovery process. When identifying an appropriate witness on these issues, ensure the witness understands the company’s IT infrastructure and can explain, in detail, the preservation and collection protocol at issue. The average IT employee or paralegal is unlikely to have the knowledge and skill to be an effective witness.

*  The Pension Committee Court pointed out that all of the declarations in this case stated that “all documents” had been collected.  With today’s proliferation of information, even the most comprehensive and well-run searches cannot locate “all documents.” “Courts cannot and do not expect that any party can meet a standard of perfection.” Rather, when offering evidence or certifications regarding preservation and collection, describe these efforts in accordance with the “reasonable inquiry” standard of Fed. R. Civ. P. 26(g).

*  Where the value of the case justifies the expense, there are distinct advantages to collections performed by expert vendors. These vendors are well versed in collection and search techniques and generate detailed documentation regarding the who, what, where, and when of the collection. They can also serve as the declarant or 30(b)(6) witness on issues of eDiscovery. This can spare the party’s legal or IT department from serving as the witness.

*  Preserve backup tapes when they are the sole source of relevant information. If, on the other hand, they contain duplicate copies of information available on servers, hard drives or other accessible sources, preservation is not necessary.

Good luck.

Daniels v. Gamma: a Basketful of Medical Malpractice Rulings

In Daniels, the Utah Supreme Court addressed a number of medical malpractice issues together with general trial issues.  Here is the gist: read more

The New Pleading Standard in Federal Court Requires Greater Factual Content

The United States Supreme Court is your new friend in seeking dismissal in federal district court.  Its Iqbal v. Ashcroft has been heralded as the “most significant Supreme Court decision in a decade for day-to-day litigation in the federal courts.”  Senator Arlen Specter (D-PA) has filed legislation to force a reversal of Iqbal.  The uproar among some counsel is in full swing.

What’s the big deal, you ask?  Well, the Court reiterated and extended in Iqbal its holding from Bell Atlantic Corp. v. Twombly, the shift in the pleading standard from simple “notice pleading” to “facial plausibility,” which provides that in order to “survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’”

The Iqbal Court disclosed that a “claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”  The plausibility standard “asks for more than a sheer possibility that a defendant has acted unlawfully.”  Moreover, “[w]here a complaint pleads facts that are ‘merely consistent with’ a defendant’s liability, it ‘stops short of the line between possibility and plausibility of ‘entitlement to relief.’”

One question that remained following Twombly was whether the ruling was intended to apply beyond the antitrust arena.  The Court expressly rejected this argument.  The Court applied Twombly and identified the two “working principles” found in Twombly: 1) “that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”  And 2) only a complaint that states a plausible claim for relief survives a motion to dismiss.  To determine facial plausibility, the district court judge must “draw on its judicial experience and common sense,” however, “where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not “show[n]”—“that the pleader is entitled to relief.”

The Court rejected an assertion that under Rule 9, Federal Rules of Civil Procedure, “general allegations,” i.e., conclusory allegations, are sufficient to assert a claim of discriminatory intent.  The Court held that “the Federal Rules do not require courts to credit a complaint’s conclusory statements without reference to its factual context.”  Moreover, the Court found that “Rule 8 does not empower respondent to plead the bare elements of his cause of action,affix the label ‘general allegation,’ and expect his complaint to survive a motion to dismiss.”

There has been no Utah state court appellate decision to cite either Twombly or Iqbal, however, you should take advantage of them state court because “[i]nterpretations of the Federal Rules of Civil Procedure are persuasive where the Utah Rules of Civil Procedure are ‘substantially similar’ to the federal rules.”  Tucker v. State Farm Mut. Auto. Ins. Co., 2002 UT 54, ¶ 7 n. 2, 53 P.3d 947 (citation omitted).  Moreover, the compiler’s notes to Utah’s Rule 8 admits that the Federal and State Rule 8 are “substantially the same” and the courts, therefore, “freely refer to authorities which have interpreted the federal rule.”  Gold Standard, Inc. v. American Barrick Res. Corp., 805 P.2d 164, 168 (Utah 1990).

Let us know if you have any success applying the Iqbal “facial plausibility” standard in state court.

Utah Federal Court Is Where I Want to Be . . .

The 10th Circuit recently reviewed the differing standards and burdens applicable in motions for summary judgment in Milne v. USA Cycling.  The court reviewed both Pearce v. Utah Athletic Foundation, 179 P.3d 760, 767 (Utah 2008) and Berry v. Greater Park City Co., 171 P.3d 442, 449 (Utah 2007) related to the proper summary judgment standard.  Ultimately, however, the court found that “although we will look to Utah law to determine what elements the plaintiffs must prove at trial to prevail on their claims we will look exclusively to federal law to determine whether plaintiffs have provided enough evidence on each of those elements to withstand summary judgment.”

If you have a case for a defendant that is susceptible to a motion for summary judgment, get it out of state court and into federal court, and keep it there at all costs.  Your chances of securing summary judgment are better.  Happy hunting.

“[W]e see no harm in allowing [counsel] to use a cultural reference as shorthand [in closing argument] . . .

to make the point that, in [counsel’s] opinion, [plaintiff’s] damages methodology was likely to render this jury’s verdict excessive.”  Boyle v. Christensen, 2009 UT App 241.  The Court makes it clear you should feel free to refer to iconic events or cases to assist your argument.  Here, counsel referred to the “McDonald’s” excessive verdict to sway the jury to see this plaintiff’s claims as excessive.  Get creative.  You have “considerable latitude” in closing arguments just as long as you don’t refer to “material that the jury would not be justified in considering in reaching its verdict.”

Make a Clean Exit From Utah Federal Court

Remember that when withdrawing as counsel in Utah Federal District Court that a local rule governs the process: DUCivR 83-1.4 ATTORNEYS – WITHDRAWAL OR REMOVAL OF ATTORNEY.  Please do not file a plain motion for withdrawal like you would in state court because the federal judge will likely deny it and you will be stuck (at least for a bit longer) in a case spending more time for which you will not be compensated.  Do it right the first time.

Utah Law: Law of the Case Doctrine vs. Mandate Rule

The Utah Supreme Court recently clarified a bit of Utah law that has vexed me in a number of my cases recently: when and to what degree a district court is bound by its previous decisions in a case.

In Mid-America Pipeline Co. v. Four-Four, Inc., 2009 UT 43, __ P.3d __, the Supreme Court reiterated the long-held principle that “under the law of the case doctrine, a decision made on an issue during one stage of a case is binding in successive stages of the same litigation.”  (Citing IHC Health Servs., Inc. v. D & K Mgmt., 2008 UT 36, ¶ 26, __ P.3d __).  This rule remains effective regardless whether the judge changes or remains the same.  Id. at ¶ 11.  “Law of the case does not prohibit a district court judge from revisiting a previously decided issue during the course of a case, . . . [r]ather, “the doctrine allows a court to decline to revisit issues within the same case once the court has ruled on them.”  Id. at ¶ 26 (emphasis added by Mid-America court).

The trial court may, sua sponte, revisit any previous rulings in a case.  No motion is required and the court can refuse to reconsider its previous rulings.  There are, however, three exceptions which require a court to reconsider its previous, unappealed, rulings: “‘(1) when there has been an intervening change of authority; (2) when new evidence has become available; or (3) when the court is convinced that its prior decision was clearly erroneous and would work a manifest injustice.’”  Id. at ¶ 14 (citing IHC Health Servs., Inc., 2008 UT at ¶ 34).

Another quasi-exception to the law of the case doctrine lies in the “mandate rule.”  “[A] district court’s power to reconsider decided issues is limited when the case has been appealed and remanded.”  Mid-America, 2009 UT at ¶ 13 (citing IHC Health Servs., 2008 UT 36, ¶ 27).  “The mandate rule, unlike the law of the case before a remand, binds both the district court and the parties to honor the mandate of the appellate court.”  Id. “Thus, the decisions of an appellate court become the law of the case and cannot be reconsidered on remand.”  Id.

You are now informed.  Good luck.

Remember You Can Use an Unsworn Declaration in the Place of an Affidavit

You may recall that in 2008 the Utah Legislature made it possible under Utah Code Ann. 78B-5-705 to submit an unsworn declaration whenever the Utah Rules of Criminal Procedure, Civil Procedure, or Evidence call for an affidavit.  You should use the following magical phrase to make sure the declaration meets the statute: “I declare [or certify, verify or state (pick your poison)] under criminal penalty of the State of Utah that the foregoing is true and correct.  Executed on _____ [date]. ______ [signature].”  Be careful though; just because it is not sworn does not mean it is not binding.  A person who knowingly makes a false declaration is guilty of a class B misdemeanor.

Settlement Agreements Revisited

As an update to my post on securing your settlement agreement, there is one more point to note: if you want the court to address certain issues that may depend on the existence of an admission of liability, it must be contained in the settlement agreement.  In Iron Head Construction, Inc. v. Gurney, the Utah Supreme Court reviewed a situation in which the parties settled their contract dispute but expressly agreed that pre-judgment interest would be determined by the district court.  The Supreme Court reversed an award of pre-judgment interest and the court of appeals.  Here are the highlights:

“where the settlement does not rest on a finding or contain a stipulation of liability and damages against a party, prejudgment interest is unavailable.”

“The settlement amount cannot properly be characterized as an award of damages for which prejudgment interest should be awarded.”

Add this to your arsenal.  Be very careful what you agree to in the heat of battle or negotiations.

Secure Your Settlement by Putting it in Writing

The Utah Supreme Court has reminded the bar in McKelvey v. Hamilton, 2009 UT App 196, __ P.3d __, that confirming an understanding between parties, especially anything that resembles a settlement or agreement as to a particular issue, is likely only enforceable if it is memorialized in writing.  A little background.  You may recall from last year, in Moss v. Parr Waddoups Brown Gee & Loveless, 2008 UT App 405, 197 P.3d 659, that the Utah Court of Appeals refused to enforce a verbal settlement agreement reached during mediation.  The court also refused to allow the mediator to testify concerning the parties’ agreement because the mediator does not constitute an agent for purposes of a party-opponent admission and the existence of the contract was “premised upon the truth of the mediator’s statements.”  Id. ¶¶ 17-18.

In McKelvey, the court examined an alleged agreement among counsel to partially settle a family estate dispute.  Counsel for the McKelvey and Hamilton (Benson Hathaway and Mark Morris, respectively) verbally discussed and agreed to terms for settling the majority of the claims and establishing a procedure for agreeing on a business appraiser.  Mr. Morris followed up the conversation with a letter outlining the parties’ agreement.  Mr. Hathaway responded by letter and identified potential appraisers but did not deny the existence of the agreement, add any terms, or object to any of the stated terms.  Mr. Hathaway later withdrew as counsel and McKelvey subsequently denied that settlement of any issues had been reached.  The district court enforced the agreement that was first verbally agreed upon and later memorialized in the parties’ correspondence.  The court found that the Mr. Hathaway’s and Mr. Morris’s correspondence was sufficient to satisfy the basic requirements for a contract, i.e., offer and acceptance.  As to the assertion that Mr. Morris’ letter was hearsay, the court distinguished Moss and determined that his “letter is clearly admissible because it is proof in itself of a verbal act of contract and is not inadmissible on any other grounds.”

When you were a young attorney, you likely received counsel from seasoned attorneys that any verbal agreement should be memorialized in writing.  McKelvey illustrates this point.  You may have great respect for the honesty and integrity of the attorney on the other side, however, that attorney’s client may not have any such integrity and, in litigation, you can count on it.  Also, counsel who you respect and trust and who may be your best friend may not always be counsel on the other side.  Also, legitimate disagreements as to what was said can arise, especially with the passage of time.  Take the time to put your agreement or understanding in writing and avoid any dispute or at least ensure (hopefully) that the court will see it your way.  Good luck.

Utah Supreme Court Apportions Medical Expenses in Worker’s Compensation Cases

Reversing a long-held position of the Labor Commission, the Utah Supreme Court held in Smith v. Labor Commission, 2009 UT 19, __ P.3d __, that when an industrial injury is compensable at less than 100% and the petitioner’s injury is apportioned among work-related and non-work-related causes, the compensation—including medical expenses—is apportioned as well.  The Labor Commission previously apportioned “compensation” but awarded 100% of medical expenses.  The Supreme Court clarified that medical expenses are “compensation” under the Utah Labor Code.  This is a significant departure since a worker whose injury was only 10% related to his employment previously could obtain an award of 100% of his medical expenses.

New Court Filing Fees Take Effect May 12, 2009

The Legislature increased nearly all court filing fees. (Current fees can be found here).  Here are the ones you will feel the most:

Civil complaint or petition: $155 $360

Counterclaim/cross-claim/3rd Party claim >$2&<$10k: $75 $150 or >$10k $105 $155

Divorce: $155 $310 or to modify divorce decree: $40 $100.

Trial de novo from small claims: $75 $225

The other fee increases are relatively minor dime and quarter increases ($10 and $25, respectively).  Maybe the increase will go back into hiring enough personnel to efficiently run the courts.  Or, maybe not.

Utah Legislature Modifies Medical Malpractice Claims Part 2

As reported here previously, the Utah Legislature was considering modifying medical malpractice claims in Utah in two ways: increasing the standard of proof required in medical malpractice cases against health care providers, i.e., doctors and hospitals, to a clear and convincing evidence standard for all care provided in the emergent situations and requiring medical experts submit to the jurisdiction of the Utah Physician’s Licensing Board.  The Legislature ultimately axed the second (and potentially problematic) part of the amendments concerning experts.  What the Utah Legislature passed is a heightened standard of care applicable to all health care providers in emergent situations.  The Legislature also included a limitation for physicians in which the heightened standard does not apply to a physician if the patient was already a patient of the physician before the emergency room encounter, the physician had treated the complained-of malady within the last three months, and the physician can consult the patient’s medical records while providing the emergency care.  This limitation is very limited and will unlikely apply in most or many circumstances.

As discussed previously, the change from a preponderance of the evidence standard as to fault to the clear and convincing evidence standard is a matter of degree that is imprecise.  Whether this new law has any affect on medical malpractice claims remains to be seen.

Pleasant Grove Prevails in Summum “Seven Aphorisms” Monument Dispute

The United States Supreme Court, via Justice Samuel Alito in a unanimous decision, found that “it is clear that the monuments in Pleasant Grove’s Pioneer Park represent government speech.”  Summum’s lawsuit was an attempt to force Pleasant Grove City, Utah, to erect a monument containing its “seven aphorisms” and be given equal space with other monuments in the park, including a monument of the ten commandments, monument to the Sept. 11 terror attacks, a stone from the first LDS temple in Nauvoo, a historic granary, and a wishing well.

I agree, the Supreme Court got this one right:

“In sum, we hold that the City’s decision to accept certain privately donated monuments while rejecting respondent’s is best viewed as a form of government speech. As a result, the City’s decision is not subject to the Free Speech Clause, and the Court of Appeals erred in holding other-wise.”

In other analysis, “the arguments embraced by Summum were not really the right way to look at the case. The core issue is not private speech in a public forum but, rather, the power of government to express itself, in this case by selecting which monuments to have in a public park . . . .”

Utah Legislature May Materially Alter Medical Malpractice Claims

The Utah Legislature currently has a bill before it, SB 79, that would increase the standard of proof required in medical malpractice cases against health care providers, i.e., doctors and hospitals, to a clear and convincing evidence standard for all care provided in the emergency department.  The heightened standard would apply until the patient is stabilized and either admitted to another department or is discharged.  The heightened standard would also continue with the patient if transported to another facility.  If passed, emergency room physicians and hospitals would receive a broad protection from lawsuits since the prevailing “preponderance of the evidence” standard is the evidentiary equivalent of “more likely than not,” i.e., at least 51%.  See MUJI 2d CV117.  “For evidence to be clear and convincing, it must at least have reached the point where there remains no substantial doubt as to the truth or correctness of the conclusion” but proof beyond a reasonable doubt is not required.  MUJI 2d CV118.

Although the heightened standard above is the lightning rod issue part in the bill, the remaining changes could likewise be as monumental.  The bill also proposes changes to the status of medical experts by granting experts a temporary license to practice in Utah for the purpose of testifying “against a physician” (no mention of hospitals or other healthcare providers here) at the price of being subject to “the authority and disciplinary actions of the [Physicians Licensing Board].”  The bill could arguably be read to only apply to experts retained by plaintiffs but not to experts retained by physicians in their defense.  This is more likely a defect of the language and not the intent of the legislature, but it should be clarified to be sure.  The bill appears to respond to a recent case in which the Utah Supreme Court overturned a trial court in which the trial court had excluded a medical expert who was not licensed to practice in Utah (then again, maybe not).  In that case, an out of state expert was alleged to have provided medical care to asbestos plaintiffs in a hotel room and later expert opinion based on that encounter.  In any event it is the last part of the bill that makes a difference because the bill goes on to amend the physician’s “Unprofessional Conduct” section to include the following within the definition of unprofessional conduct:

(3) providing expert medical testimony:
(a) on a contingency fee basis in any action for injury or death arising out of the
provisions of or failure to provide health care services; or
(b) that is false or completely without medical foundation, including:
(i) without a thorough review of the medical records of the claimant;
(ii) without a physical examination of the claimant where appropriate or convenient;
(iii) without foundation in accepted science-based medical research; or
(iv) not based on current standards of care for Utah.

An out of state expert who is retained to provide expert testimony in a medical malpractice case against a physician in Utah will be subjecting him or herself to the jurisdiction of Physicians Licensing Board.  If an expert is found to be involved in “unprofessional conduct,” the expert may be charged with a third degree felony and/or fined up to $10,000.  The bill rightly aims to decrease the retention of experts who say whatever the attorney hiring them pays them to say.  Does it do more?  It could have a chilling effect on the ability of both doctors and patients to find out of state physicians willing to testify in a Utah case if there is a possibility of being dragged into Utah to answer an unprofessional conduct charge.  It is arguable that under the bill’s language an out of state expert’s opinion could be “completely without medical foundation” if it is “not based on current standards of care for Utah.”  What are the “current standards of care for Utah”?  Are the standards higher or lower than other states?  What about rural versus urban healthcare?  Does rural or urban Utah differ from rural or urban in some other state?  Do we want an expert whose medical opinion is not based on experience with “current standards of care in Utah” testifying about what the standards should be?  It seems both doctors and patients would lose a great source of expert testimony if experts had to either have experience with the “current standards of care for Utah” or educate themselves about Utah’s standards before testifying.  I like the idea behind the bill, but it needs some tweaking to get it right.

Proposed Federal Civil Rule Changes: Rules 26 (experts) and 56 (summary judgment)

The Federal Civil Rules Advisory Committee has issued a report and has begun conducting hearings concerning two proposed rule changes related to the ever-important Rule 26 regarding the disclosure of experts and related testimony and Rule 56 regarding briefing motions for and oppositions to summary judgment.  The Civil Rules Advisory Committee report can be found here.

Some highlights in the proposed changes include:

Rule 26:

The work-product protection is extended to an expert’s draft reports and to attorney communications with the expert except as to 1) expert compensation, 2) facts or data provided by the attorney that the expert considered in forming his or her opinions, and 3) any assumptions provided by the attorney on which the expert has relied.  Experts would be required to disclose all “facts and data” considered by the witness in forming his or her opinion and not all “data or other information”.

Disclosure of expert witnesses who are not required to file an expert report (such as treating physicians who may provide both fact and expert testimony) would include the subject matter of the witness’ expected expert testimony and a “summary of the facts and opinions to which the expert is expected to testify.”  Apparently some courts have taken to requiring the extensive expert reports from all witnesses from whom the court might be expected to hear expert opinion at trial.

Rule 56:

It is proposed that a memorandum opposing summary judgment under Rule 56(c) set forth all of the disputed facts found in the movant’s memorandum—which appears to be an adoption by the federal courts of the same procedure found in the Utah Rule of Civil Procedure Rule 7(c)(3)(B).  I.e., nothing new here.

The remaining changes appear to be stylistic or attempts to reconcile the various federal rules for consistency.  Note, however, that the committee took nearly two pages of its commentary to address the dispute raised in the 2007 Amendments to Rule 56(a)’s change to whether a court “shall” or “should” grant summary judgment in the absence of genuine issues of material fact and entitlement as a matter of law.  Others have also voiced their opinion on the 2007 Amendment.

Utah U.S. District Court Tests “E-Summons”

The United States District Court for the District of Utah is testing a procedure in which a summons can be issued electronically.  Currently the procedure is to either file everything (complaint, cover sheet, check, and summons) in person and have the clerk issue the summons or file nearly everything (complaint, cover sheet, and check) electronically and visit the court clerk for the issuance of the summons.  According to U.S. Magistrate Judge David Nuffer, the court has been testing an “e-summons” procedure and form that looks like it may be implemented in 2009.

Your Utah Legal Community

The beginning of an era.  The start of something new for the Utah’s unique legal community.  This site is meant to be a combination of legal information, news, and opinion—both yours and ours.  Without your input the story is only half-told and information only slightly accurate.  We expect you to be active participants.  You may remain anonymous or you can identify yourself; it’s your choice.  Your comments will be lightly monitored (primarily for spam and patently offensive content), however, you are expected to be professional and courteous.  That said, let’s get started.