Party Must Do More than Indirectly Mention an Issue to Preserve It for Appeal

(info) — Thu, 02 Sep 2010 13:31:33 -0400

September 2, 2010

Today, the 7th Circuit issued a decision that highlights the importance of the arguments that are made to a trial court. In Weber v. Universities Research Assn., Inc., Case No. 08-1957, the plaintiff sued her former employer for sex discrimination and retaliation in violation of Title VII. A plaintiff asserting a claim of discrimination or retaliation under Title VII may choose to prove her case under either the direct or indirect method and the district court granted summary judgment to the employer, finding that the plaintiff did not attempt to present any direct evidence of discrimination or retaliation.

On appeal, the plaintiff argued that she did produce evidence sufficient to survive summary judgment under both the direct and indirect methods. However, the Court found that she had waived any argument regarding the direct evidence.

After reviewing Weber's submissions to the district court opposing URA's motion for summary judgment, we find that Weber indeed failed to sufficiently raise the direct method of proof to preserve the issue for appeal. A single sentence that mentions a theory of direct proof—suspicious timing1—is not enough to preserve the issue for appeal, especially where Weber apparently did nothing more to indicate to the district court that she was pursuing the direct method of establishing her retaliation claim.

This case is a reminder that you must present some argument on all issues that you would like to raise on appeal. A single sentence that infers that you are raising an issue is not enough.

Brad A. Catlin
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Insurer Is Not Required to Pay Unreasonable Attorney's Fees if It Does Not Handle Its Insured's Defense

(info) — Tue, 31 Aug 2010 22:05:56 -0400

September 1, 2010

Full Disclosure -- our firm represents the insured in both the case discussed below and the malpractice action discussed within that case

On August 31, 2010, the 7th Circuit held that a liability insurer that does not control the defense of the suit against its insured is not obliged to pay for attorney's fees associated with bad advice offered by the insured's counsel, even if the insurer could have have told the insured that its law firm was making a dumb legal argument in Hayes Lemmerz Intern'l, Inc. v. ACE Am. Ins. Co., Case No. 10-1073.

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In this case, an insurance company had issued a workers' compensation and employer liability policy to Hayes Lemmerz International ("HLI") and to its subsidiaries. Workers were injured at a plant owned by HLI's subsidiary and a tort suit was brought against both the parent and subsidiary corporations. The complaint did not identify either company as the employer of the injured workers. The plaintiffs had already filed a workers' compensation claim, naming both parent and subsidiary as the employers of the accident victims, and had received workers' compensation benefits. The Court described what happened next as follows:

HLI and Huntington knew of course that Huntington was the employer of the accident victims and that HLI, the parent corporation, was not. But the lawyer handling the tort suit for the two companies seems not to have known (maybe the plaintiffs didn’t know either) that in 2001 Indiana, reacting negatively to a decision by the Indiana Supreme Court confirming the understanding of affiliate liability set forth above, McQuade v. Draw Tite, Inc., 659 N.E.2d 1016, 1020 (Ind. 1995), had amended its workers’ compensation law to provide that "a parent corporation and its subsidiaries shall each be considered [for purposes of workers' compensation law] joint employers of the corporation's, the parent's, or the subsidiaries' employees." Ind. Code § 22-3-6-1(a). Hence HLI was insulated from tort liability to the victims of the explosion: by virtue of being deemed a joint employer, its liability to them was governed exclusively by workers' compensation law even if in other states it could have been sued as a tortfeasor had it contributed to the injuries to its affiliate’s employees.

HLI notified its carrier of the lawsuit, but ACE elected not to take control of HLI's defense and only agreed to pay for half of the defense.

HLI filed a dec action against the insurer and the district court granted the insurer's motion to dismiss under Rule 12(b)(6). HLI appealed that judgment.

On appeal, HLI argued that because it was an employer, ACE was obliged by the terms of the insurance policy to defend it either directly or by reimbursing its defense costs. The Court agreed, holding that it was readily ascertainable fact to ACE that HLI was an employer by virtue of the 2001 amendment to Indiana's workers' compensation law, given ACE's knowledge of the underlying facts. Nevertheless, the Court held that ACE should not be forced to bear the costs of any mistaken legal advice offered by HLI's counsel.

HLI admits it made a dreadful mistake in denying in the tort suit that it was an employer. It blames its law firm for the mistake, and has sued the firm for malpractice. We cannot understand why any part of the costs of that mistake should be shifted to ACE. HLI did not ask ACE to handle its defense against the tort suit, but only for reimbursement of its legal expenses. The duty of reimbursement is limited to reasonable expenses, as otherwise the insured
would have no incentive to economize; and HLI's expenses were unreasonable — that indeed is the premise of its malpractice suit. ... [A] liability insurer that does not control the defense of the suit against its insured is not obliged to give advice to the insured on legal strategy. ... ACE had no duty to provide its insured's lawyers with legal advice.

Thus, in this case the Court squarely placed the risk of receiving bad legal advice on the entity controlling the defense. If that entity is the insurer, then the insurer may have to bear those costs. However, if that entity is the insured, then the insurer will not have to bear those costs. Therefore, counsel will want to take this into account when advising their clients on the wisdom of controlling their own defense, rather than encouraging the insurer to do so.

Lessons:

Insurers will not need to pay the costs of defense associated with malpractice committed by defense counsel if the insurer does not control the defense.

Brad A. Catlin
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7th Circuit Propounds Test for when a Treating Physician Must File a Formal Report under Rule 26(a)(2)(B)

(info) — Tue, 31 Aug 2010 20:58:23 -0400

September 1, 2010

On August 30, 2010, the Seventh Circuit determined, for the first time, when a treating physician who provides an expert opinion as to causation is required to file a formal report under Rule 26(a)(2)(B) in Meyers v. Nat'l RR. Passenger Corp. (Amtrak), Case No. 09-3323. To put the matter simply, "a treating physician who is offered to provide expert testimony as to the cause of the plaintiff's injury, but who did not make that determination in the course of providing treatment" must file such a report.

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In Meyers, the plaintiff brought an occupational injury lawsuit against his employer, Amtrak, under the Federal Employers’ Liability Act (“FELA”). In response to a motion for summary judgment filed by Amtrak, the plaintiff offered, inter alia, expert testimony from his treating physicians to prove causation between Amtrak’s actions, or lack thereof, and his injuries. Amtrak moved to strike the reports of these experts as non-compliant with Fed. R. Civ. P. 26(a)(2). The district court granted that motion and awarded summary judgment in its entirety to Amtrak. The plaintiff appealed.

On appeal, the Court recognized that it had not yet spoken on whether a treating physician is "is one retained or specially employed to provide expert testimony in the case or one whose duties as the party’s employee regularly involve giving expert testimony" and, therefore, subject to the disclosure requirements of Rule 26(a)(2).

We resolve this outstanding issue today by concluding that a treating physician who is offered to provide expert testimony as to the cause of the plaintiff's injury, but who did not make that determination in the course of providing treatment, should be deemed to be one "retained or specially employed to provide expert testimony in the case," and thus is required to submit an expert report in accordance with Rule 26(a)(2).

The plaintiff "present[ed] no evidence ... suggesting that either doctor previously considered or determined the cause of Meyers’s injuries during the course of treatment." Therefore, the Court held that the opinions were properly stricken.

The lesson from this case is clear -- a plaintiff who does not wish to make the Rule 26(a)(2) disclosures regarding the opinions of a treating physician must demonstrate that the doctor's opinion was formed "in the course of providing treatment." However, the details about how this will actually play out in litigation are less clear. Those who choose to take advantage of the safe harbor offered by the Court's decision should ideally have the expert's report describe why the causation determination was made in the course of providing treatment. If this cannot be done, then the proponent of that expert must make some other sort of showing on this issue, lest the expert be stricken.

Lessons:

A treating physician's opinion on causation must have been made in the course of providing treatment if it is not disclosed in accordance with Rule 26(a)(2).

Brad A. Catlin
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Court Splits the Baby on Whether Woman Is a "Child" for Purposes of Intestate Succession

(info) — Fri, 27 Aug 2010 13:35:48 -0400

August 27, 2010

Today, the Indiana Court of Appeals decided that a trial court erred when granting summary judgment to a woman on the issue of whether she was entitled to a share of an intestate decedent's estate in Regalado v. Estate of Regalado, Case No. 64A05-0911-CV-672. This case addresses a number of issues in which our readers should be interested.

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Lessons:

When presenting evidence that is only admissible as newly discovered evidence, you must provide a factual basis demonstrating why it should be considered as newly discovered evidence.
A child is born out of wedlock for the purposes of intestate succession if the parents of the child are not married to each other.
A person who is trying to establish paternity for the purposes of the intestate succession statutes should plan on meeting the requirements of I.C. § 31-14-7-1.
Language in a trial court's order that is not germane to the issue that it is resolving has no preclusive effect.

Brad A. Catlin
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Those who Live in Glass Houses ...

(info) — Fri, 27 Aug 2010 10:43:33 -0400

August 27, 2010

Today, the Seventh Circuit issued a decision in Gross v. Town of Cicero>, Case No. 06-4042. Our focus on the lessons to be learned from this case deal with well-worn proverbs and idioms, not from the substantive issues involved.

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Lessons:

Do not seek sanctions against your opponent for failing to follow the Rules while making that same mistake.

Brad A. Catlin
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Court of Appeals Finds Excusable Neglect for Pro Se Appellant

(info) — Wed, 25 Aug 2010 11:21:54 -0400

August 25, 2010

Today, the Indiana Court of Appeals issued a memorandum decision, uncitable as authority under App. R. 65(D), in Chaluvadi v. City of Indianapolis, Case No. 49A02-1003-OV-230, a pro se appellant. The appellant was given a speeding ticket, but crossed out the "amount owed" portion of the ticket. The appellant assumed that it was a warning, until the trial court entered a default judgment on the traffic ticket and ordered that Chaluvadi’s driver’s license be suspended. The appellant used a form provided by the Court to challenge the judgment under Trial Rule 60(B) and the trial court denied that motion.

The appellate court reversed the trial court's order, finding that the appellant's confusion over whether she received a warning or ticket was "entirely understandable and excusable." The Court then went on "to glean from the materials available to us what Chaluvadi’s defense would be," because the court's form for challenging the judgment was vague and the City did not file an appellate brief, and found that one existed.

The Court's generosity in this case appears to largely be caused by the particular circumstances of the case. But this is precisely what litigators should remember -- the circumstances and procedural posture of a case matter, especially when litigating against a pro se opponent.

UPDATE: On August 27, 2010, the Indiana Court of Appeals issued a similar decision, which it has designated for publication, reaching a similar result in Butler v. State of Indiana, Case No. 49A02-0904-CV-343.

Brad A. Catlin
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Appellate Practice Tip - Make Sure to File a Motion for Oral Argument

(info) — Tue, 24 Aug 2010 17:00:10 -0400

August 24, 2010

If you want to orally argue a case before the Indiana Court of Appeals, make sure to file a motion for an oral argument pursuant to Indiana Appellate Rule 52. Merely placing "Oral Argument Requested" on the cover of your appellate brief is insufficient. See footnote 2.

Brad A. Catlin
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Attorney's Statements at Hearing Is Binding on Client Against All Defendants

(info) — Thu, 19 Aug 2010 12:45:35 -0400

August 19, 2010

Today, the Indiana Court of Appeals issued a decision which held that an attorney's statements during a hearing were binding on the client and entitled the opposing party to judgment on some of the claims against it in Heyser v. Noble Roman's, Inc., Case No. 29A04-1002-PL-71.

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In this case, the plaintiffs filed suit, asserting fraud and other claims. Two of the defendants moved to dismiss under Rule 12(b)(6) and that motion was granted. At a hearing on that motion, plaintiffs' counsel stated:

So I would submit to the Court that we have certainly alleged sufficient facts to fall within that case to hold the banks liable or at least pass a motion to dismiss on a claim that [the Banks] conspired and acted in concert with Noble Roman's under these alleged facts. We've cited some other cases on constructive fraud and basically under those kind of cases the claim that you were making a representation about future promises and opinions and not facts was not upheld. We haven't pleaded constructive fraud so I would submit to the Court that we state the cause of action for fraud, Gable v. Curtis, supports that.

The remaining defendant then moved for partial summary judgment, asserting that the plaintiffs were alleging actual fraud, not constructive fraud. The plaintiffs responded, asserting that their complaint and subsequent amendments alleged both actual and constructive fraud. The Court granted the defendant's motion because the plaintiffs' counsel, at a hearing on the other defendants' motion to dismiss, had told the court that the plaintiffs had not pleaded constructive fraud. The plaintiffs then appealed.

On appeal, the plaintiffs argued that their attorney's statement did not constitute a binding admission. The Court disagreed.

[T]he Franchisees' then counsel admitted that the Franchisees were only pleading actual fraud against Noble Roman's, who was the only defendant that allegedly made fraudulent statements. That admission was binding upon the Franchisees throughout the lawsuit. Under these circumstances, Noble Roman's was entitled to judgment as a matter of law on the Franchisees' subsequent attempt to plead constructive fraud, and the trial court did not err by granting partial summary judgment to Noble Roman's on that claim.

This decision clarifies that statements made by counsel at a hearing are binding for all purposes in the lawsuit. Therefore, counsel should be aware of all possible consequences of any particular statement, rather than solely focusing on the statement in relation to a particular opponent.

Lessons:

Any unambiguous statement that an attorney makes during the course of litigation will be binding on that attorney's clients against all parties to that litigation.

Brad A. Catlin
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Court of Appeals Disagrees over Availability Attorney Fees under Adult Wrongful Death Statute

(info) — Wed, 18 Aug 2010 13:19:00 -0400

August 18, 2010

Less than a month ago, we brought you this report about McCabe v. Commissioner, Ind. Dept. of Insurance, a split-decision by the Indiana Court of Appeals, which held that attorney's fees were not authorized under the Adult Wrongful Death Statute ("AWDS"), Indiana Code § 34-23-1-2. As we described in our prior post, McCabe recognized that it expressly disagreed on this issue with the decision in Hillebrand v. Supervised Estate of Large, 914 N.E.2d 846, 848 (Ind. Ct. App. 2009), a decision penned by the dissenting judge in McCabe. Today, a separate panel of the Indiana Court of Appeals reached precisely the opposite conclusion in Hematology-Oncology of Indiana, P.C. v. Fruits, Case No. 49A05-0910-CV-556.

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Lessons:

There is no clear appellate authority on the issue of whether attorney's fees should be awarded under the Adult Wrongful Death Statute. Expect the Indiana Supreme Court to grant transfer to address this issue soon.

Brad A. Catlin
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Attorney Has No Duty to Represent Client Beyond Scope of Contract

(info) — Tue, 17 Aug 2010 10:14:20 -0400

August 17, 2010

On August 16, 2010, the Indiana Court of Appeals held that an attorney did not commit malpractice because she had no duty to represent her client beyond that described in the representation agreement in Flatow v. Ingalls, Case No. 49A02-0910-CV-994.

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In this case, Ingalls filed a four-count lawsuit against his former employer, alleging, inter alia, defamation. After one claim was dismissed, Ingalls hired Flatow to represent him as to the defamation claim only. Flatow proceeded to move for partial summary judgment on the defamation claim. The former employer filed a brief in opposition and a cross-motion for summary judgment on all three remaining counts of Ingalls’s complaint, including the defamation count. Ingalls did not file a reply to the response to his motion for partial summary judgment, nor did he file a response to the cross-motion for summary judgment. The trial court granted judgment to the former employer. Ingalls then sued Flatow for legal malpractice. Flatow's motion for summary judgment was denied and she was granted permission to pursue an interlocutory appeal.

On appeal, the Court turned to Indiana Professional Conduct Rule 1.2(c) to inform it of the scope of the duty that Flatow owed to Ingalls and narrowly construed the duty. The contract provided that Flatow would "draft a motion for summary judgment and a reply brief in the above matter" and that the "representation in this matter includes inception of the matter through the end of trial." The Court held as follows:

[W]e view the contract provision stating the Flatow Defendants will represent Ingalls from "inception of the matter through the end of trial" in light of the more specific provisions and conclude the "matter" is Ingalls’s summary judgment motion, and that although the Flatow Defendants may be alongside Ingalls through the entire proceedings, they will be active only on this one limited matter.

Because the representation was so limited, Flatow had no duty to respond to the former employer's motion for summary judgment, even though it addressed the defamation claim.

Judge Kirsch disagreed with this conclusion, finding that the Flatow's agreement to represent Ingalls in "the matter through the end of trial" was an express agreement to represent Ingalls on his defamation claim and to take all steps required by the applicable standard of care regarding the summary judgment proceedings and, thereafter, through to the end of trial. However, he concurred in the judgment because Ingalls failed to point to any legal argument that should have been made or evidence that should have been designated in reply in support of his own motion or in response to his former employer's motion that would have resulted in a more favorable outcome.

All attorneys should take note of the decision in this case. The Court's decision sends a clear signal that a lawyer's legal duty to represent a client in any particular matter will be narrowly construed to the definition of that matter. Courts should not find that a legal duty to represent a client in exists simply because of the existence of an attorney-client relationship in a very closely related matter. However, attorneys should be cautioned that this decision, while citing Indiana Professional Conduct Rule 1.2(c), does not claim that it is determining the scope of the ethical duties posed by that Rule.

Lessons:

Courts will construe the legal duty that an attorney owes to her client narrowly.

Brad A. Catlin
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