Business Dispute

February 19, 2012

The Third Part of Our Discussion Regarding the Anatomy of a Class Action Certification

Following the prior discussion of numerosity and commonality, we will now examine the court’s analysis of typicality under Louisiana Code of Civil Procedure Article 591(A)(3). This prerequisite obligates the court to examine whether the claims or defenses of the representative parties are typical of the entire class. The requirement is met if the claims of the class representatives arise out of the same “event, practice, or course of conduct that gives rise to the claims of other class members and those claims are based on the same legal theory.” See Gudo v. Admins. of Tulane Educ. Fund.

The court reviewed the three putative class members presented by Plaintiffs. Ramona Alexander lived in Hahnville on the day of the chemical release. She testified that she smelled a strong odor in her home on the morning of July 7, 2009 which caused her to become sick and vomit. The odor also caused burning in her eyes, throat irritation, and shortness of breath. Vanessa Wilson lived in Waggaman on the day of the chemical release. She awoke to an odor that caused eye irritation, nausea, coughing, and a sore throat. Wilson testified that she traveled to Avondale that morning where the odor persisted; her symptoms worsened. She also received a panicked phone call from her mother who was being ordered to evacuate her home in St. Charles Parish. Upon arriving at her mother’s house, Wilson observed her mother vomiting and suffering from burning in her eyes. Melissa Berniard, who is a licensed attorney in Louisiana, testified that she was in her home in Orleans Parish on the morning of July 7. She awoke to a foul odor that suggested to her that something may have been burning; she soon experienced eye irritation, headache, nausea, and feelings of anxiety. Berniard traveled to Jefferson Parish later in the day and spoke with others who experienced similar symptoms. The court found that Wilson, Alexander, and Berniard all offered “typical complaints of the constituency of the class” that were corroborated by Dr. Williams’s analysis of numerous class members’ intake forms which captured their symptoms. Accordingly, the court concluded that the “issue of whether or not a release of ethyl acrylate can cause the damage alleged by the class representatives is common to all class members and is adequately represented.”

The court next considered whether the proposed class representatives are adequate under the Louisiana Code by referencing a definition adopted by the Fourth Circuit Court of Appeal. In essence, the Fourth Circuit’s analysis of adequacy concerns whether the proposed representatives’ claims are “typical of” the claims of all class members and whether the damages asserted by the representatives are of the same type as the class as a whole. See Dupree v. Lafayette Ins. Co. The court noted that Wilson, Alexander, and Berniard all testified to being present in the defined geographical area on July 7, 2009, suffering from the type of symptoms that were common to the class, and being willing to serve as class representatives. Thus, the court held that the adequacy requirement was met with respect to the plaintiff representatives. The court also made a finding on a related matter that Plaintiffs’ counsel are “highly skilled attorneys with experience in class action litigation” and well qualified to serve as class counsel. The court expressed that it was “particularly impressed” with the attorneys’ presentation at the certification hearing, and felt that “there is no dispute as to the competency and the zealousness of class counsel.”

February 17, 2012

Second Part in Understanding the Anatomy of a Class Action Certification

by Berniard Law Firm

In our previous post, we began a discussion of the Union Carbide/Dow Chemical Taft plant chemical leak litigation filed by the Berniard Law Firm. This post continues with a review of the court’s analysis of numerosity in certifying a class. Under this requirement, the class must be so large that joinder of all members is impracticable. La. Code Civ. P. Art. 591(A)(1). Generally, a class action is favored when there are so many plaintiffs that individual suits would unduly burden the court, and so the class action would be more judicially expedient than other available procedures. See Cotton v. Gaylord Container. There is no distinct number of plaintiffs needed to fulfill the numerosity requirement. In this case, the proposed class included all the residents of St. Charles Parish as well as certain residents of Jefferson and Orleans Parishes–clearly a large number. The court found persuasive the fact that “the size of the individual claims of class members is small enough that individual lawsuits are impracticable,” but that that “separate suits would unduly burden the courts.” In the court’s view, a class action would “be more useful and judicially expedient.” Thus, the court concluded that “numerosity exists,” but that “the class is not too numerous to manage effectively.”

The court next examined the issue of commonality, or whether there were questions of law or fact common to the class. To satisfy the commonality requirement, there must exist “as to the totality of the issues a common nucleus of operative facts.” McCastle v. Rollins Environmental Services. of La., Inc. A common question is one that, when resolved for one class member, is resolved for all members. This issue is closely related to the predominance requirement, where the common questions predominate over any individual issues not shared among the class members. The Louisiana Supreme Court has indicated that predominance “entails identifying the substantive issues that will control the outcome, assessing which issues will predominate, and then determining whether the issues are common to the class.” The goal is to “prevent[] the class from degenerating into a series of individual trials. Brooks v. Union Pacific R. Co. The same court has also held that a mass tort can only be brought as class action if it arose from one single cause or disaster; however, this requirement does not mean that the amount or extent of damages must be identical for all class members. “[V]arying degrees of damages … does not preclude class certification.” In order to meet the common cause requirement, each member of the class must be able to show individual causation based on the same set of facts and law that any other class member would use. See Bartlett v. Browning-Ferris Indus. Chem. Services, Inc.

With these considerations in mind, the court analyzed the common threads identified by the Plaintiffs as to their claims. First, all class members were physically located in the identified parishes on the date and time of the chemical release. They all suffered various (but similar) physical injuries and financial losses as a result of the release. Also, common questions of law and fact surrounded the Defendants’ negligence in failing to maintain its plant and prevent the chemical release. The court concluded that it was “satisfied … from the evidence presented that common factual issues predominate with regard to whether Defendants took reasonable steps to prevent the release of [ethyl acrylate] that occurred on July 7, 2009 and whether or not the release could cause the harm as alleged by the Plaintiffs to the members of the class.” The court’s reasoning was based in part on the testimony offered at the hearing by Dr. Patricia Williams, a toxicology expert. Dr. Williams concluded that the symptoms described by the class were consistent with the type of exposure to ethyl acrylate that resulted from the release at the Taft plant. Although the Defendants offered its own expert witness to rebut Dr. Williams’s testimony, the court nevertheless found that “a method of assessing general causation for the whole of the class exist[ed].” This permitted the court to reach the conclusion that common factual issues were present. The court thus identified a “common nucleus of operative facts” that permitted a finding that “uniform allegations of complaints of harm amongst the large number of class members that stem from one central release event” involved common legal issues among all members that superseded any individual concerns.

January 19, 2012

Third Circuit Rejects Trial Court’s Apportionment of Fault in Lafayette Auto Accident

by Berniard Law Firm

It is well settled in Louisiana jurisprudence that an appellate court’s review of a trial court’s apportionment of fault in a negligence action is subject to the manifest error standard. In other words, in order for an appellate court to overturn a trial court’s assessment of fault, it must conclude that no reasonable factual basis exists to support the trial court’s finding and that it is clearly wrong. The Third Circuit reached this conclusion in Thibodeaux v. Trahan, a recent case that was marked by witness testimony that was “externally conflicting and often internally inconsistent.”

On the afternoon of October 18, 2006, Melinda Trahan was driving a school bus owned by the Lafayette Parish School Board on Richfield Road in Duson. Harold Thibodeaux, driving an RV, pulled out from a side road in front of Trahan’s bus and made a quick left turn into the parking lot of Thib’s Corner, a grocery store. Trahan, who approached Thibodeaux’s RV from the rear, also turned her bus into Thib’s Corner, at which point the two vehicles collided. Thibodeaux suffered a knee injury in the collision and sued Trahan and the school board for damages. The trial court heard testimony from the parties as well as several witnesses and ultimately found both Trahan and Thibodeaux at fault for the accident. It awarded Thibodeaux damages for pain and suffering and medical expenses, but reduced the amount by 40 percent, the amount of his fault. Thibodeaux appealed, arguing that the trial court erred in finding him partially at fault for the accident. On appeal, the Third Circuit noted that “the trial court was left with numerous conflicting versions of how the accident occurred.” It did, however, make specific findings of fact. Specifically, the trial court found Thibodeaux at fault “for having pulled out in front of Ms. Trahan while driving an RV in the rain while she was driving a school bus.” It concluded Trahan was at fault because she should have maintained better control of her bus when she saw Thibodeaux’s RV pull out into her path. The Third Circuit reviewed the testimony from the record and arrived at a different explanation of how the collision occurred: it concluded that Thibodeaux did nothing wrong when he pulled onto Richfield Road from the side street, but that he “failed to ascertain that the left turn could be made with reasonable safety” and therefore breached his statutory duty to execute the turn properly. Still, the court concluded that “the majority of the fault in this instance should be allocated to Ms. Trahan,” as she “was in a better position, as the following vehicle, to prevent the accident from happening.” The court concluded that the accident would have been avoided if Trahan had stopped her bus “within the adequate stopping distance existing between her and the RV,” rather than being forced to take an evasive turn into the Thib’s Corner parking lot. Accordingly, the court reversed the trial court’s apportionment and assessed 80 percent of the fault to Trahan and 20 percent to Thibodeaux.

January 17, 2012

Third Circuit Reverses Trial Court in Rare Finding of Abuse of Discretion in Med Mal Action

by Berniard Law Firm

In a medical malpractice lawsuit, the plaintiff faces a three-part evidentiary burden. First, she must present evidence to establish the applicable standard of care. Next, she must show that a breach of that standard of care occurred. Finally, she must demonstrate a link between that breach and the injury that resulted. In nearly all cases, the opinion of a medical expert is an essential element of the required evidence. Without a qualified medical expert’s opinion, the plaintiff risks losing at summary judgment due to a lack of material issues of fact to be determined at trial. The availability of an expert’s opinion was at the center of the recent case in the Third Circuit, Dupree v. Louisiana Medical Mutual Insurance Co.

Katie Dupree became a patient of Dr. Jose Dorta, an OB/GYN specialist, in 2008 when she was pregnant. On January 9, 2009, Dupree went to the ER at Opelousas General Hospital with facial swelling, vomiting, and a severe headache. She was told to stop working and rest at home due to elevated blood pressure. Two weeks later, Dupree again went to the ER with elevated blood pressure and other symptoms that suggested pregnancy complications. Dr. Dorta did nothing to treat these issues and did not suggest an early delivery of Dupree’s baby. In fact, Dr. Dorta merely sent Dupree home with the suggestion of bed rest. Two days later, Dupree was found face down and unconscious. Tragically, her baby was stillborn the following day, at which point Dupree was then taken off life support and died. Dupree’s parents requested review by a Medical Review Panel in June 25, 2009. The panel rendered its finding of no malpractice on Dr. Dorta’s part on May 12, 2010. Sixteen days later, Dupree’s parents filed suit against Dr. Dorta and his medical malpractice insurance carrier, Louisiana Medical Mutual Insurance Co. After overcoming a series of exceptions filed by the defendants, the plaintiffs requested a status conference to schedule a trial date. Immediately thereafter, the defendants filed a motion for summary judgment. The trial judge granted the defendants’ motion based on the plaintiffs’ “failure to submit an affidavit from an expert showing a genuine issue of material fact sufficient to defeat summary judgment.” At the hearing, plaintiffs’ counsel argued that he had obtained an expert but did not submit an affidavit because the trial scheduling order called for expert reports to be exchanged several months later. The trial court disregarded this argument. It then denied the plaintiffs’ request for a new trial after they produced an affidavit from Dr. James Tappan, a board certified physician specializing in obstetrics and gynecology.

The Third Circuit Court of Appeal, mindful that a “trial court is imbued with great discretion in both pre-trial and post-trial matters,” ultimately concluded the this denial of a new trial was an abuse of that discretion. “[T]he Louisiana Code of Civil Procedure provides that a ‘new trial may be granted in any case if there is good ground therefor, except as otherwise provided by law,’” the court reasoned, and “after reviewing the record before us, we find good and valid reasons for a new trial.” Namely, Dr. Tappan’s affidavit included “three specific acts of medical negligence … : failure to diagnose, failure to warn, and failure to timely deliver the baby.” The court noted that Dr. Tappan reported that “Dr. Dorta failed to warn Ms. Dupree and/or her family of her condition and what to look for with respect to further symptoms,” which was at odds with the Medical Review Panel’s finding that “we are sure a lengthy discussion ensued” when Dupree sought treatment. These conflicting views presented a genuine issue of material fact. Yet, the trial court “ruled on the motion for new trial without reference to the affidavit, choosing to rely instead on the fact that plaintiffs failed to take advantage of their one opportunity to present evidence.” Being careful not to “condone or legitimize the actions of plaintiffs’ counsel in failing to timely file an expert affidavit,” the court concluded that “the facts, the law, and plaintiffs’ prudence and initiative in prosecuting this case compel a finding of an abuse of discretion by the trial court,” and reversed the denial of a new trial.

January 7, 2012

Dishonest Attorney Helps Illustrate Need to Hire Representation Carefully

by Berniard Law Firm

Paul Breaux, an employee injured on the job, hired an attorney to represent him in a personal injury suit against his employer, Jade Marine. Unbeknownst to Breaux, the company settled the matter out of court. A check in the amount of $60,000 was sent to the attorney, which was immediately forged and deposited into the attorney’s IOLTA account at Gulf Coast Bank. After about fourteen months, Breaux finally learns of this despicable action by the attorney and files a claim against the bank for conversion. Specifically, the action was for check conversion or conversion of a negotiable instrument.

However, Breaux hit a wall when the defendant raised the exception that the statute of limitations for such a claim under La.R.S. 10:3-420 is strictly one year. Accordingly, Breaux appealed, arguing that the defendant’s exception was ineffective based on the doctrine of contra non valentem, specifically that “a prescription does not run against one who is unable to act.” Breaux emphasized that he was not equipped to discover what his attorney did, as he was under the impression that his case was ongoing. The court was not convinced.

Breaux sought the support from the case of Marin v. Exxon Mobil Corp., 09-2368, 09-2371(La. 10/19/10), 48 So.3d 234, which outlined four situations when contra non valentem (doctrine outlining prescription and when an individual knows the clock of liability begins) applies to defeat prescription. The fourth and most difficult category, known as the “discovery rule,” is where Breaux saw an opportunity. Under this exception, a plaintiff’s claim is not barred when the statute of limitations has run if the defendant has acted in fraudulent concealment.

January 5, 2012

Family Business Suit in Beauregard Parish Illustrates Dismissal Principles

by Berniard Law Firm

Alan Kite had many disagreements with his father as the two separated from their business relationship. Alan said that his father had harmed his reputation, that his father had discharged Alan to retaliate against him, and that Alan had relied on his father’s promises to his detriment. Alan had other disputes, but the 36th Judicial District Court, Beauregard Parish, saw disputed facts that required more consideration than dismissal by a motion for summary judgment. The Louisiana Court of Appeal agreed with the district court’s decision to dismiss some of Alan’s claims in Kite v. Kite Bros., No. 11-334 c/w 11-335 (La. Ct. App. 3 Cir. 10/5/11).

Alan Kite had worked in the Kite Brothers recreational vehicle dealership since the 1980s. He did well, earning more than $200,000 a year, as set by his father, Robert Kite. Alan wanted more. He agreed with his brother, Jeff, to raise their salaries, as much as triple the salary for Alan, and to take 10% of the business revenues. The chaos from Hurricane Rita hid this action temporarily, but the father learned about it a few months later in January 2006. The sons quit, or were fired, from the dealership. Alan took business papers with him. The sons sued their father and the business and set up their own competing RV dealership. The brothers fought over control of their own dealership, and Jeff reconciled with his father. Jeff dismissed his claims against his father.

Robert Kite tried to have dismissed more of the claims against the business. The trial court agreed in part. The trial court’s decision does not affect other claims that Alan still has against his father’s business. Alan claimed that his father had damaged his reputation by calling him a “thief” and a “liar.” The district court dismissed the claim. It concluded that “the fact that Alan did what any reasonable person would see was stealing would be a complete defense to the action for defamation.”

January 3, 2012

Family Feud Demonstrates Appealable Judgements in Court Case

by Berniard Law Firm

As sons of an owner of a successful recreational vehicle business, Alan and Jeff Kite worked in the family business of Kite Brothers. The relationship went sour between father and son. The children gave themselves raises and later left — taking some business records with them. But, Alan Kite’s claims, such as defamation, retaliatory discharge, and detrimental reliance, against Kite Brothers didn’t hold up at trial court or the court of appeal. In Kite v. Kite Bros., No. 11-334 c/w 11-335 (La. Ct. App. 3 Cir. 10/5/11) the court of appeal affirmed the 36th Judicial District Court, Beauregard Parish after it determined that the trial court had rendered a final judgment on those claims.

Family businesses create unique disputes of a personal nature. Robert Kite co-founded the dealership with his brother in 1961. It began as a corporation but was changed to a limited liability company in 1998. During the 1980s, Robert Kite hired his sons Alan and Jeff. Although he never signed an employment contract, Alan had broad powers in the business to write checks on the company account. The father believed that he was being generous to son Alan, who earned more than $200,000 a year. But, the father set the salaries. Hurricane Rita in September 2005 provided a diversion for the sons to decide, on their own, to raise their salaries. Alan agreed with his brother to take more than triple his previous weekly salary, which had been set at $1,500 a week. They also agreed to take a 10% cut of all revenues. They agreed that this arrangement would end when “everything settled down after the storm.”

They didn’t stop. The father noticed the increased unauthorized compensation to Jeff in January 2006. He demanded that Jeff return his salary to its authorized level. The father also revoked both sons’ authority to write checks and canceled their credit cards. Alan continued to give himself a weekly salary of $5,000 instead of $1,500. Later that month, the sons left the business. Father and sons disagree whether Alan and Jeff quit or were fired. Alan took with him, also without permission, business papers owned by the business. The father sought them back by filing a criminal complaint. Alan assured an investigating police officer that he would return the records, but he never did. Alan’s lawyer later returned some of them.