17Sep

Fourth Circuit Narrowly Construes FRSA’s Election of Remedies Provision

Categories: 4th Cir. Blog

By Elissa Hachmeister

Today, in a published opinion in the civil case of Lee v. Norfolk Southern Railway Co., the Fourth Circuit established that the “Election of Remedies” provision of the Federal Railroad Safety Act (FRSA) is to be narrowly applied to bar duplicative claims brought under statutes aimed at preventing retaliation for workplace health and safety whistleblowing.

Lee’s Suspension and Subsequent Lawsuits

Charles Lee works as a carman for Northern Southern Railway Company (NS), where his responsibilities include inspecting railcars to identify potential defects. According to Lee, NS’s management capped the number of railcars that Lee could tag for repair. Lee refused to comply with the quotas because he believed federal law required him to identify and tag all defective railcars.

Lee, an African-American, further alleged that NS denied African-American carmen the training and advancement opportunities provided to white carmen. Lee described racial harassment by co-workers, who allegedly threatened his children, called him racial slurs, and hung a noose in his locker.

In July 2011, Lee was suspended for six months without pay. NS claimed it suspended Lee for drinking on the job in violation of company policy. Lee claimed that the suspension was really motivated by racial and retaliatory animus. He alleged that his white supervisor drank beer on duty and was never disciplined.

Lee filed two lawsuits against NS. In the first, Lee claimed racial discrimination in violation of 42 U.S.C. § 1981. The district court granted summary judgment for NS.

In the second lawsuit, Lee claimed retaliation in violation of the whistleblower protection provision of FRSA. Lee did not bring this claim in his first lawsuit because he was required to exhaust his administrative remedies first. The district court held that the second lawsuit was barred by FRSA’s Election of Remedies provision, which forbids an employee from “seek[ing] protection under both this section and another provision of law for the same allegedly unlawful act of the railroad carrier.” 49 U.S.C. § 20109(f).

FRSA’s Election of Remedies Provision Does Not Require a Choice Between FRSA and Federal Antidiscrimination Laws

While the district court had focused on whether Lee’s first lawsuit under § 1981 was an attempt to seek protection under “another provision of law,” the Fourth Circuit clarified that the issue was whether the two lawsuits, which both challenge the same suspension, concerned “the same allegedly unlawful act.” A question of statutory interpretation is reviewed de novo.

The court first looked at the plain language of the Election of Remedies provision and concluded that that the phrase “the same unlawful act” ordinarily means that the act is unlawful for the same reasons. The court explained that the “same act” may be implicated in more than one claim yet is “allegedly unlawful” for fundamentally different reasons depending on the claim. The provision is not triggered by merely the “same act” but by “the same allegedly unlawful act.”

Looking beyond the meaning of the words, the court reasoned that accepted grammatical rules also support its interpretation of the phrase. There is no comma between “same” and “allegedly unlawful act,” suggesting that “same” modifies the entire phrase and “unlawful act” should be read as a unit. If “same” and “allegedly unlawful” both independently modify “act,” then the adjectives should be separated by a comma per several widely respected style guides.

While the court found the provision unambiguous—that is, capable of only one reasonable interpretation—it noted that the result would have been the same even if it had found the provision ambiguous: the legislative history and context of the statute showed that the Election of Remedies provision was “only intended to bar railroad employees from seeking duplicative relief under overlapping anti-retaliation or whistleblower statutes that provide protections similar to the protections in FRSA.” Thus, the Election of Remedies provision would apply to potential claims under the Occupational Health and Safety Act (OSH Act) and various state versions of the OSH Act since those statutes, like FRSA, are aimed at preventing retaliation for engaging in protected whistleblowing activities regarding safety and health in the workplace.

The court also pointed to a 2007 amendment to FRSA that states that nothing in the FRSA’s retaliation provision is to “diminish” other rights of employees under “any” law. 49 U.S.C. § 20109(h). Quoting approvingly from a Sixth Circuit opinion, the Fourth Circuit explained that the Election of Remedies provision, if construed as NS suggested, would dilute an employee’s rights since“[r]estricting an employee to only one of the numerous arrows in his quiver obviously reduces the number of options available to him.” Norfolk S. Ry. Co. v. Perez (6th Cir. 2015).

FRSA’s Election of Remedies Provision Does Not Bar Lee’s Suit

Although both of Lee’s lawsuits challenge the same “act”— his suspension by NS—the Fourth Circuit agreed with Lee that a suspension on the basis of race is not “the same allegedly unlawful act” as a suspension in retaliation for railway safety whistleblowing. The court explained that a suspension in itself is not unlawful. An “unlawful act” must have a basis in the law. Since Lee’s claims were based in different laws they did not concern the “same allegedly unlawful act.”

The court emphasized that the laws implicated here, § 1981 and FRSA, have different aims and give rise to distinct causes of action with different elements and burdens of proof. FRSA seeks to prevent retaliation for engaging in protected whistleblowing activities regarding railway safety while § 1981 aims to halt racial discrimination. FRSA’s Election of Remedies provision therefore does not apply to bar Lee’s second lawsuit.

The Fourth Circuit Vacated and Remanded for Further Proceedings

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16Sep

Fourth Circuit Affirms Summary Judgment on the Basis of Qualified Immunity

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By Malorie Letcavage

Overview

In a published opinion of a civil case issued on April 28, 2015, the Fourth Circuit affirmed the lower court’s decision to grant summary judgment on the basis of qualified immunity in the case of Raub v. Campbell. The appellant, Brandon Raub, argued that his Fourth Amendment right to be free from unreasonable seizures, and his First Amendment right to free speech were violated by the appellee, Michael Campbell. Raub also sought injunctive relief even if his constitutional claims failed. In reviewing the district court’s grant of summary judgment, the Fourth Circuit used a de novo standard. The Fourth Circuit upheld the district court’s grant of summary judgment on the basis of qualified immunity because it found that Raub’s Fourth Amendment rights were not violated, he had not pled sufficient facts for a First Amendment claim and there was no abuse of discretion in the district court’s dismissal of his injunctive claim for relief.

Factual Background

In the summer of 2012, two Marine veterans that had served with Brandon Raub contacted the FBI about Raub’s Facebook posts. Raub posted threatening messages and employed extremist language in numerous posts. The FBI and local law enforcement visited Raub to question him about his Facebook activity. The agents reported that Raub’s behavior was unusual because during the interview he was preoccupied, could not maintain eye contact and displayed extreme mood swings.

The agents contacted Michael Campbell, a certified mental health “prescreener” affiliated with the local emergency services. Campbell recommended Raub be detained for evaluation, at which point the officers took Raub to the local jail. Campbell interviewed Raub and noted the same behavior the officers had described; Raub was distracted, and had trouble answering questions. Campbell concluded Raub might be paranoid and delusional.

Campbell petitioned and was granted a temporary detention from the magistrate because Raub was displaying signs of psychosis. Four days into the temporary detention, the court ordered that Raub be admitted to the hospital for thirty days. However, a few days later Raub was released because the court found that the petition had insufficient factual allegations. Raub then filed suit under 42 U.S.C. §1983 against Campbell. The district court granted Campbell’s motion for summary judgment due to qualified immunity and denied Raub’s request for injunctive relief.

42 U.S.C. 1983

This statute provides an avenue to pursue a civil action for a deprivation of constitutional rights. It lays out that any person acting under the color of state law (which, as in this case, can include a mental health professional associated with emergency services) who subjects anyone to a “deprivation of any rights, privileges, or immunities secured by the Constitution and laws” will be liable to the party injured.

Appellant’s Fourth Amendment Rights Were Not Violated

The court explained that qualified immunity analysis has two prongs: 1. Whether the plaintiff has established the violation of a constitutional right and 2. Whether that right was clearly established at the time of the alleged violation.

The court decided to start its evaluation with the second prong and held that Campbell’s conduct was not proscribed by clearly established law. The court noted that a seizure requires probable cause but there is a lack of clarity in the law concerning seizures for psychological evaluations. The court then went on to cite the major cases in the Fourth Circuit which all held that that seizures for psychological evaluation were upheld when the person was a threat to himself or others. The court held that due to the totality of the factors, including the content of Raub’s Facebook posts, the initial observations by the officers and Campbell’s observations of Raub, Campbell did not violate Raub’s Fourth Amendment rights because his petition to detain was reasonable based on existing precedent.

Appellant Failed to Allege Sufficient Facts for a First Amendment Claim

Though Raub contended that Campbell only recommended detention based on Raub’s “unorthodox political statements,” the court found that Campbell had numerous other reasons for recommending detention. The court cited the content of the Facebook posts, Raub’s behavior during the interview, and the increasingly threatening nature of his posts. Even if the political statements were part of the decision, the court found Campbell had plenty of other reasons for Raub to be detained. Thus the court held that Raub did not sufficiently allege facts for a First Amendment violation and Campbell was entitled to qualified immunity.

Appellant’s Claim for Injunctive Relief Was Properly Rejected

The court reviewed the denial of injunctive relief for abuse of discretion, and it found none. Under §1983 when a plaintiff is seeking injunctive relief, he needs to demonstrate a real or immediate threat that he will be wronged again in a similar way. However, Raub only alleged that his political beliefs would subject him to seizures and retaliation in the future. The court found that this claim was too speculative and did not reach the level needed to grant equitable relief.

Conclusion

The court did not find that Raub’s Fourth Amendment rights were violated nor did it find that he had alleged sufficient facts for a First Amendment claim. It also found no abuse of discretion in the dismissal of the claim for injunctive relief. Therefore, the court affirmed the lower court’s grant of summary judgment.

Tags: Civil Litigation First Amendment Fourth Amendment Free Speech injunctive relief Summary Judgment

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10Sep

What Is the Appropriate Procedure for Seeking Judicial Review of an Arbitration Award Entered Under the Multiemployer Pension Plan Amendments Act?

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By George Kennedy

On April 21, 2015, the Fourth Circuit issued a published opinion in the civil case of Freight Drivers and Helpers Local Union No. 557 Pension Fund v. Penske Logistics LLC in which it held that commencing an action by filing a complaint is the proper procedure for seeking judicial review of an arbitration award under the Multiemployer Pension Plan Amendments Act (“MPPAA”), reversing the judgment of the District of Maryland. Additionally, the Court held that the amended complaint filed by Freight Drivers and Helpers Local Union No. 557 Pension Fund (“Pension Fund”) was timely because it related back to the original complaint.

Facts Leading up to the Dispute and Arbitration Proceedings

In 2004, Penske Logistics LLC (“Penske”) transferred ownership of its subsidiary, Leaseway Motorcar Transport Company, to a third party. After transferring control, Penske ceased making contributions to the Pension Fund. The Pension Fund responded by assessing withdrawal liability against Penske. Penske refused to pay the withdrawal liability, and soon thereafter, Penske and the Pension Fund submitted their dispute for arbitration.

The parties entered into arbitration proceedings and in July 13, 2012, the arbitrator dismissed the Pension Fund’s claims. The arbitrator decided that Penske was not liable for the withdrawal liability assessed against it because Penske was exempt as “‘a trucking industry fund as that term is described in [29 U.S.C. § 1383(d)].”

The Pension Fund Seeks Judicial Review

Following the arbitrator’s order against it, the Pension Fund sought judicial review of the order by filing a complaint in the District of Maryland on August 9, 2012. Subsequently, Penske filed a motion to dismiss the Pension Fund’s complaint. The District Court granted Penske’s motion, but granted leave for the Pension Fund to amend the complaint within 21 days of the filing of its original complaint.

The Pension Fund filed an amended complaint within 21 days. Again, Penske filed a motion to dismiss the complaint, and again, the District of Maryland granted the motion. In so holding, the District of Maryland argued that the proper mechanism for reviewing an arbitration award under the MPPAA is the filing of a motion under the provisions of the Federal Arbitration Act. As such, the District of Maryland treated the Pension Fund’s amended complaint as a motion, and held that it was deficient for two reasons. First, the Court held that it was untimely because motions cannot relate back pursuant to Federal Rule of Civil Procedure 15. Second, the Court held that it was lacking an attached memorandum stating the authority and reasoning in support as required for motions under Local Rule 105.

The Filing of a Complaint is the Appropriate Procedure

The Fourth Circuit first took up the issue of which procedure is correct for seeking review of an arbitration award under the MPPAA. It held, contrary to the District of Maryland, that the proper procedure is the filing of a complaint, and not the filing of a motion. In so holding, the Fourth Circuit appealed to: (1) the plain meaning of Sections 1401 and 1451 of the MPPAA, (2) the language of related provisions of the MPPAA, (3) the Rules of Civil Procedure, and (4) the legislative intent surrounding the enactment of the MPPAA.

The Fourth Circuit considered, and ultimately dismissed, Penske’s counterargument that Section 1401(b)(3) of the MPPAA is controlling in this case and mandates that judicial review be sought by filing a motion and not by filing a complaint. The Fourth Circuit explained that Section 1401(b)(3) applies only to arbitration proceedings and not to the process of seeking judicial review. Instead, the Fourth Circuit argued that Section 1401(b)(2) of the MPPAA controls judicial review of arbitration awards, and that it states that judicial review is to be sought by filing a complaint, and not a motion.

The Pension Fund’s Amended Complaint is Timely Because it Relates Back

After establishing that the filing of a complaint is the appropriate method for seeking review of an arbitration order under the MPPAA, the Fourth Circuit then ruled on whether the Pension Fund’s amended complaint was timely. The Fourth Circuit held that the amended complaint was timely because it related back to the original complaint pursuant to Federal Rule of Civil Procedure 15. The Court reasoned that since the amended complaint asserted claims arising out of the same conduct underlying the claims of the original complaint, the requirements for relation back under Rule 15 were satisfied. The Court quickly dismissed Penske’s argument to the contrary, holding that it was “hyper-technical, carrying no equitable or pragmatic weight.”

Judgment Reversed and Remanded

Accordingly, the Fourth Circuit reversed the judgment of the District of Maryland, remanding the case for further proceedings.

Tags: Civil Litigation Civil Procedure

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20Mar

No Qualified Immunity for Officers in Their Use of Excessive Force

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By Joshua P. Bussen

On March 18, 2015, in a published opinion of the civil case Smith v. Ray, the Fourth Circuit affirmed the district court’s denial of summary judgement to two police officers who were accused of using of excessive force. The circuit court found no error in the Eastern District of Virginia’s decision to deny the police officers qualified immunity.

The Use of Excessive Force

On September 21, 2006, a uniformed Virginia police officer was looking for a missing juvenile. The officer heard that the juvenile might be at a house in Virginia Beach, VA. When the officer arrived at the house and knocked on the door, the plaintiff Amanda Smith answered. The officer and Amanda spoke for a little while before she turned to go back inside. As she opened the door the officer slammed it shut and grabbed Amanda by her arm. The officer then slammed her to the ground and pressed his knee into her back—resting his full weight on her. The officer also punched her several times in the ribs and yanked on her ponytail. Throughout the entire incident, Amanda never resisted. She did, however, receive multiple visible bruises, a broken rib, shoulder pains, as well as other emotional injuries.

Assault, Battery, and Qualified Immunity

Amanda, the plaintiff, sued the officers for state law assault and battery. The officers asserted that they were immune from the suit under the qualified immunity doctrine. Qualified immunity bars suits against officers unless (1) the facts, taken in the light most favorable to the plaintiff, show that the officer violated a federal right, and (2) the right was clearly established at the time the violation occurred, such that a reasonable person would have known his conduct was unconstitutional.

Was the Force Required?

The Fourth Circuit stated that “when a plaintiff has alleged that an officer employed excessive force in making an arrest, the federal right is the Fourth Amendment right against unreasonable seizures.” In determining if the right was “clearly established,” it articulated that evaluating the reasonableness of an officer’s actions under Fourth Circuit precedent requires a balancing of the individual’s rights against the countervailing governmental interest—a “totality of the circumstances” evaluation. In this case, the Fourth Circuit found that the officer grabbed Amanda with no provocation and threw her to the ground despite the fact that he only, at the most, suspected her of aiding in the delinquency of a minor—a misdemeanor. The circuit judges also found that nothing in the record suggested that Amanda resisted arrest or presented any threat to the officers.

The District Court’s Decision Is Affirmed

The Fourth Circuit found that the officer had acted in a completely unreasonable manner in his use of force against Amanda Smith on September 21, 2006. He threw her to the ground with no provocation or present risk of harm, and continued to treat her violently despite her passive reaction. Therefore, the circuit court held that the district court was correct to deny the officers’ motion for summary judgement under the qualified immunity doctrine.

Tags: Civil Litigation Constitutional Law

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5Mar

Prospective Request for Attorneys’ Fees Did Not Violate Fair Debt Collection Practices Act

Categories: 4th Cir. Blog Uncategorized

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By Rolf Garcia-Gallont

In an opinion published today, the Fourth Circuit affirmed the district court’s decision in the civil case of Elyazidi v. SunTrust Bank, dismissing all claims brought by the appellant and original plaintiff, Mounia Elyazidi.

Facts and Procedural Posture

Elyazidi overdrew her SunTrust checking account when, despite having only a few hundred dollars in the account, she cut herself a check for nearly $10,000 and cashed it at a SunTrust branch.

When Elyazidi had opened her account with SunTrust, she had signed an agreement that included a provision addressing the account holder’s overdraft liability as follows:

You are liable for all amounts charged to your Account, whether by offset, overdraft, lien or fees. If we take court action or commence an arbitration proceeding against you to collect such amounts, . . . you will also be liable for court or arbitration costs, other charges or fees, and attorney’s fees up to 25 percent, or an amount as permitted by law, of the amount owed to us.

After its own attempts to collect the money proved unsuccessful, SunTrust hired a Maryland law firm, Mitchell Rubenstein & Associates (“MR&A”), to bring a debt collection suit. Because Elyazidi is a Virginia resident, MR&A filed suit on SunTrust’s behalf in Virginia state court. MR&A used a “warrant in debt,” a standardized pleading form that the Virginia courts make available to creditors. The attorneys filled in the blanks to indicate that Elyazidi owed $9,490.82, plus 6 percent interest; $58 in costs; and $2,372.71 in attorneys’ fees. The $2,372.71 in attorneys’ fees represented exactly 25% of the amount Elyazidi owed. MR&A and SunTrust both submitted affidavits along with the pleading, estimating the legal work that would be required to justify this amount. The Virginia state court entered judgment for the full amount demanded by the plaintiff.

After losing her collection suit in Virginia, Elyazidi filed a complaint against SunTrust and MR&A in Maryland state court. Four of her claims — two under Maryland state law, and two under the federal Fair Debt Collection Practices Act (FDCPA) — challenged SunTrust’s and MR&A’s efforts to recover attorneys’s fees in the Virginia suit. Another claim was brought under the FDCPA to recover for MR&A’s disclosure of Elyazidi’s social security number in an unredacted exhibit produced during the Virginia proceedings.

SunTrust and MR&A removed the case to the United States District Court for the District of Maryland, where they were granted a motion to dismiss all claims for failure to state a claim. Elyazidi appealed.

FDCPA CLAIMS

Appellees’ Prayer for Attorneys’ Fees Cannot, as a Matter of Law, Be a False, Deceptive, or Misleading Representation Under the FDCPA

Pursuant to 15 U.S.C. § 1692e, a debt collector may not “use any false, deceptive, or misleading representation or means in connection with the collection of any debt.” It is unlawful to make a “false representation of (A) the character, amount, or legal status of any debt; or (B) any services rendered or compensation which may be lawfully received by any debt collector for the collection of a debt.” To violate the statute, a representation must be material, in the sense that it would affect a naive, unsophisticated consumer’s decisionmaking.

The Fourth Circuit found that MR&A’s representations in the Virginia pleading form were not misleading, because the attorneys sought no more than was allowed in the agreement between Elyazidi and SunTrust, indicated via affidavit that the figure was an estimate, and provided an explanation for the amount of work that would generate that amount of fees. Under these circumstances, not even the most unsophisticated consumer would have misunderstood the nature of MR&A’s request.

The Agreement between Elyazidi and SunTrust Expressly Authorized SunTrust to Seek Attorney’s Fees

Section 1692f(1) of the FDCPA condemns the use of “unfair or unconscionable means to collect or attempt to collect any debt,” and provides a non-exhaustive list of proscribed conduct, including “[t]he collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.”

Again, because SunTrust sought nothing more than to enforce their valid contractual rights, the Fourth Circuit affirmed dismissal of this claim for failure to state a claim for relief.

Accidental Disclosure of Elyazidi’s Social Security Number During Litigation Was Not an Unfair or Unconscionable Means of Debt Collection Under FDCPA

Section 1692f lists several examples of unfair or unconscionable debt collection practices. The common denominator of these prohibited practices is that they involve harassing or pressuring the debtor to pay her debt. Elyazidi argued that MR&A had intentionally disclosed her social security number as a means to “extort payment” from her.

The Fourth Circuit again affirmed dismissal of her claim, considering that there was no evidence of a scheme to extort payment, and the fact that the failure to redact the documents that contained the social security number had been quickly remedied.

MARYLAND STATE CLAIMS

The Maryland Consumer Debt Collection Act (“MCDCA”) and Maryland Consumer Protection Act (“MCPA”) Did Not Apply to Appelles’ Conduct, Which Took Place Outside of Maryland

The federal district court exercised supplemental jurisdiction over Elyazidi’s Maryland state claims, and dismissed them on the grounds that neither the MCDCA nor the MCPA applies to conduct occurring “entirely” in Virginia.

In Maryland, regulatory statutes are “generally construed as not having extra-territorial effect unless a contrary legislative intent is expressly stated.” Regardless of the fact that MR&A was a Maryland firm, the entirety of the conduct that gave rise to Elyazidi’s claims took place in Virginia. For this reason, the Fourth Circuit affirmed the district court’s dismissal of both Maryland state claims.

The District Court’s Decision to Dismiss All Counts for Failure to State a Claim is Affirmed

Tags: Civil Litigation Debt Collection

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2Mar

How Many Experts to Prove Causation? Five Fail in Medical Device Products Liability Case

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By Elissa Hachmeister

Today, March 2, 2015, in the civil case Lewis v. Johnson & Johnson, the Fourth Circuit affirmed in an unpublished opinion the District Court for the Southern District of West Virginia’s decisions granting summary judgment for the defendant on Lewis’ failure-to-warn claim and directing a verdict for the defendant on Lewis’ design defect claim.

Lewis’ Products Liability Suit

Carolyn Lewis, a Texas resident, alleged injuries resulting from tension-free vaginal tape (TVT) manufactured by a subsidiary of Johnson & Johnson. The defendant moved for summary judgment, and the district court granted summary judgment as to Lewis’ failure-to-warn claim. At trial, Lewis presented testimony from five expert witnesses as well as current and former employees of the TVT manufacturer. Nonetheless, the district court directed a verdict for the defendant on the remaining design defect claim at the conclusion of Lewis’ case.

Summary Judgment on Failure-to-Warn Claim

A district court’s grant of summary judgment is reviewed de novo. The grant will be affirmed if there is no genuine dispute as to a material fact and the moving party is entitled to judgment as a matter of law. The evidence is viewed in the light most favorable to the non-moving party.

Under Texas law, the applicable law in this diversity case, a failure-to-warn claim requires proof of two elements: (1) that the product warning was inadequate, and (2) that the inadequate warning “was a producing cause of the plaintiff’s condition or injury.” Porterfield v. Ethicon, Inc., 183 F.3d 464, 468 (5th Cir. 1999).

In order to establish the “producing cause” element, the plaintiff must show that a different warning would have changed her physician’s decision to prescribe the device. (A device manufacturer’s duty to warn of risks extends only to physicians prescribing the device and does not reach patients who ultimately receive the device.) Absent such proof, the inadequate warning cannot be said to have caused the patient’s injuries.

Prescribing Doctor’s Failure to Rely on Inadequate Warning Defeats Causation

The doctor who recommended and implanted Lewis’ TVT did not rely on the warning or instructions for use in making her decision to prescribe the device. The doctor could not recall whether or not she even possessed the patient brochure containing the warning at the time of Lewis’ surgery. She had last read the TVT’s instructions for use during her surgery fellowship in 2002, seven years before prescribing the device to Lewis. When asked whether she had relied on these documents in prescribing the TVT, the doctor admitted she did not. Instead, she relied on her own experience and her examination of the patient. Because the doctor did not rely on the allegedly inadequate warning in prescribing the device, the warning cannot be the cause of Lewis’ injuries. The Fourth Circuit affirmed the district court’s grant of summary judgment, agreeing that Lewis did not offer sufficient evidence to create a dispute as to material fact regarding whether a different warning would have changed her doctor’s decision to prescribe the TVT.

Judgment as a Matter of Law on the Design Defect Claim

The grant of a motion for a directed verdict is reviewed de novo. A directed verdict is appropriate where, without weighing the evidence or considering the credibility of the witnesses, there is just one verdict that reasonable jurors could reach. Plaintiff can avoid a directed verdict by presenting sufficient evidence to establish a prima facie case.

Under Texas law, a design defect claim requires the plaintiff to show “that (1) the product was defectively designed so as to render it unreasonably dangerous; (2) a safer alternative design existed; and (3) the defect was a producing cause of the injury for which the plaintiff seeks recovery.” Timpte Indus., Inc. v. Gish, 286 S.W.3d 306, 311 (Tex. 2009). The district court directed a verdict for the defendant based on the final element.

Expert Testimony Needed to Prove Causation in Cases Involving Complex Medical Issues

Expert testimony is necessary to establish causation when an issue involves matters beyond a lay juror’s general experience and common understanding. Cases involving medical diagnoses and complex medical devices will normally require expert testimony. Indeed, the Fourth Circuit characterizes the issues in this case as “complex and technical medical issues beyond common knowledge and experience,” and therefore agrees with the district court’s assessment that Texas law required Lewis to present expert testimony on the causation element.

Experts Failed to Establish Causal Connection Between TVT Defect and Lewis’ Injuries

Although Lewis presented five expert witnesses, the Fourth Circuit concluded that no testimony was sufficient to show causation. One expert testified that the TVT caused Lewis’s pain, but did not testify that a particular defect caused her pain. Another expert did point to a specific property of the TVT, explaining how it might cause pain, but the testimony established only that the device could cause injuries, not that it did in this specific case. (The expert had not examined or treated Lewis.) A third expert’s testimony failed for the same reason: identifying a characteristic of the TVT and connecting it to chronic pain generally does not suffice to establish a causal link between a defect in Lewis’ TVT and Lewis’ pain. And a fourth expert testified to degradation of the TVT in Lewis, but failed to connect it to her pain.

Finally, the fifth expert did offer the right opinion—but the district court excluded it because the expert was unqualified. Rulings on the admissibility of expert testimony are reviewed under a deferential abuse of discretion standard, and the Fourth Circuit concluded that the district court did not abuse its discretion in excluding the opinion. Absent expert testimony that a defect in the TVT caused Lewis’ injuries, the district court properly directed a verdict for the defendant.

Court of Appeals for the Fourth Circuit Affirmed

Tags: Causation Civil Litigation Products Liability

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4Feb

Tort Claim Against Spam E-Mail Senders Barred By Consent Doctrine

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By Patrick Southern

Today, in Beyond Systems, Inc. v. Kraft Foods, Inc., the Fourth Circuit held in a published decision that the established tort doctrine of volenti non fit injuria (“to a willing person it is not a wrong”) applies to internet service providers (an “ISP”) who set “spam traps” solely for the purpose of raising claims against those who send certain types of spam e-mails. The appellate court affirmed the decision of the District of Maryland in this civil case.

Defendants Argue The Claim Is Barred

Defendant Kraft Foods argued successfully at the District Court level that the claims of plaintiff Beyond Systems and third-party plaintiff Hypertouch were barred because the plaintiffs’ actions before the filing of the action constituted consent. The plaintiffs appealed this issue in the hopes of receiving a new trial, since the District of Maryland never so much as reached the question of damages in this tort action.

Plaintiffs Have a History of Claims Under Anti-Spam Statutes

Spam e-mail became an issue in the 1990s and 2000s, and 35 states responded by 2004 in passing legislation providing for a private right of action for ISPs for violations of provisions related to the sending of spam.

The plaintiff in this case, Beyond Systems, is a Maryland-based corporation which used certain tactics referred to as “spam traps.” In the code of various web sites, it hid e-mail addresses in a way that could not be seen by the typical end user, but instead were only visible to “spam crawlers” (programs which are used by spammers to look for e-mail addresses and subscribe them to e-mail lists). Beyond Systems did nothing to filter or block spam e-mails on the accounts in question, and actually increased its storage capacity to archive these e-mails and retain them for use in litigation.

The third-party plaintiff, Hypertouch, is a California-based corporation owned by the brother of the owner of Beyond Systems. It had engaged in similar tactics and sued Kraft Foods in 2005 over certain e-mails. The claim resulted in a settlement, which provided in part that Hypertouch agreed to cooperate with Kraft in identifying future e-mails that may violate California law. Such lawsuits were big business for both companies, accounting for 90 percent of Beyond Systems’ income in recent years.

In 2008, Beyond Systems sued Kraft and another company, Connexus, in the District of Maryland, bringing both Maryland and California state law claims. Many of the e-mails in question were the same ones that formed the basis for the Hypertouch suit in 2005. Partial summary judgment was granted on e-mails that had been part of the Hypertouch suit, e-mails in which Hypertouch did not notify Kraft of the violations in accordance with the settlement agreement, and (because of the applicable statute of limitations) e-mails which were sent more than one year before the suit.

The District Court bifurcated the trial into a “liability” proceeding and a “damages” proceeding. There were two phases to the liability proceeding: in the first, the court had to determine if Beyond Systems met the Maryland state law standard for being classified as an ISP; in the second, it then had to determine if it was a “bona fide” ISP. The jury found that Beyond Systems met the state law standard, but said because of its litigation activities and relationship to Hypertouch, it was not a “bona fide” ISP. It held that Beyond Systems had invited its own injury and was thus barred from recovery.

The Tactics Utilized by Plaintiffs Constituted Consent

While the cause of action in this case is derived from state statutes, it is rooted deeply in the tort law tradition. Thus, common law rules are applicable in such cases. The Fourth Circuit held, accordingly, that the common law principle that one cannot recover damages flowing from conduct he consents to barred Beyond Systems from any recovery in this case. The appellate court agreed with the trial court that the actions of Beyond Systems constituted consent.

Claims Based on State Statutes Viewed Through The Lens of Tort Law

The Maryland and California laws at issue in this case exist only as a result of an exception to the federal law which precluded many such statutes, the CAN-SPAM Act (15 U.S.C. § 7701(a(11) et seq.). The federal law allowed certain state laws to continue in operation so long as they were aimed at prohibiting “falsity or deception” in such spam e-mails. Both the Maryland and California laws fall into that category, but since they are primarily concerned with falsity and deception, the Fourth Circuit indicated they fall “into the vein of tort.”

It is a general maxim of tort law that “no wrong is done to one who consents.” In other words, one who consents to conduct of another cannot recover in an action of tort for the conduct or for harm resulting from it. Maryland and California courts have recognized that “[t]hose who, with full knowledge, assent to the invasion of their interests may not complain.”

The Fourth Circuit held that in this case, there was “overwhelming” evidence that Beyond Systems consented to the harm it claims it suffered. It created fake e-mail addresses solely to gather spam, embedded those e-mail addresses in web sites in a way in which they could only be discovered by “spam crawler” programs, and even increased storage capacity to hold more spam e-mails.

But the distinction here is admittedly a thin one. In a footnote, the court made clear it is not barring all claims from a plaintiff ISP whose legitimate business is impacted by deceptive spam and gathers e-mails to have evidence for a suit. The case here turned on the nature of Beyond Systems as a company (its substantial revenue stream from claims related to spam e-mail), and the court said that this plaintiff “gratuitously created circumstances which would support a legal claim and acted with the chief aim of collecting a damage award.”

The Judgment of the District of Maryland Is Affirmed

The Fourth Circuit agreed with the District Court that Beyond Systems had consented to receive the spam e-mails in question in this case, and thus it was barred from any potential recovery.

Tags: Civil Litigation Tort

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18Jan