LawyersUSAlawyersusaonline.com

SATURDAY, DECEMBER 29, 2012 | ISSUE 55

WEEKLY UPDATE

BY CORREY E. STEPHENSON | STAFF WRITER

Sharron Juno died because of a typo. A lifelong diabetic, Juno had her insulin

dosage dictated by her doctor in Alabama but transcribed by an outsourced sub-con-tractor in India, who wrote “80” instead of “8.”

Juno passed away after receiving a dose ten times what it should be.

The jury’s anger at the defendants – Thomas Hospital in Fairhope, Ala. and the outsourcing companies it contracted with – drove the $140 million verdict, said Skip Finkbohner, who represented the plain-tiff ’s family.

“In any trial, the plaintiff has peaks and valleys but in this case, there didn’t ever seem to be a valley,” said Finkbohner, a partner at Cunningham Bounds in Mobile, Ala. “Sharron Juno died a needless death.”

Joseph A. Farchione of Wheeler Trigg in

Denver, who represented Thomas Hospi-tal, said the jury’s anger at the Indian tran-scription companies left the hospital too close to the fire – and it got burned.

“The verdict is so out of proportion with the hospital’s actions, it will be reduced without question,” he said.

Ten times the correct dosageA lifelong insulin-dependent diabetic,

Juno was admitted to Thomas Hospital to have her dialysis port cleared of a blood clot in March 2008. She was discharged on March 17 and went home. But Juno and her family realized she needed skilled nurs-ing care and she decided to go to an inter-im rehabilitation facility as her doctor had initially recommended, Finkbohner said.

A nurse at the hospital was asked to transfer Juno’s information to Mercy

BY DAVID E. FRANK | CONTRIBUTING WRITER

A Massachusetts judge’s refusal to issue an injunction in a suit involving a car deal-ership allegedly defamed by the relatives of an ex-employee demonstrates the struggle for courts that are asked to strike a balance between the First Amendment and social media sites like Facebook and Twitter.

In Clay Corporation v. Colter, the em-ployee’s brothers, who claim she was fired because she suffered from brain cancer, launched an aggressive social media cam-paign that generated more than 50,000 followers and caused plaintiff Clay Nissan to suffer substantial financial harm.

A lawyer has been suspended for two years for charging a client hourly legal fees for both legal and non-legal services, including driving the ailing client and helping him move to a new home.

Katherine M. Guste, a Louisiana at-torney, was given a two-year suspension and ordered to pay restitution for billing her normal $125 per hour billable rate for tasks like taking her 63-year-old client to the bank, running errands for him and packing up his belongings to move him from one nursing home to another.

Guste originally represented the client in legal matters that included drafting a power of attorney and criminal defense, but continued to charge the same fees for

as much as 200 hours of non-legal work. “[Her client] paid a total of $29,000, and

according to [Guste]’s accounting, she performed 215.9 hours of service (both legal and non-legal) for him at $125 per hour, for a total of $26,987.50. However, [Guste] could not ethically charge her cli-ent for her time as a lawyer when she was providing nonlegal services. Therefore, her fee is excessive,” the Louisiana Su-preme Court said in a written opinion.

A dissenting judge argued that the punishment was too harsh given that the disciplinary board found insufficient evi-dence that the client suffered from dimin-ished mental capacity.

– SYLVIA HSIEH

Lawyers suspended for charging billable rate for non-legal work

Continued on page 2

Continued on page 3

Anger over outsourced medical transcription errors yields $140M

Sharon Juno’s family won a $140 million verdict after she died due a medication overdose.

Defamation case exposes social media controversy

Page 2News LAWYERS USA WEEKLY UPDATE | SATURDAY, DECEMBER 29, 2012

Medical, the rehab facility. The nurse was supposed to get Juno’s medication recon-ciliation document, which contained her dosage information, as well as her patient transfer order, both documents that her doctor had reviewed and signed.

But when the nurse couldn’t get her hands on the documents because Juno’s chart was being scanned, she decided not to wait and printed out a copy of the doc-tor’s dictated discharge summary instead.

The summary was different than the other two documents, Finkbohner said. It had been dictated by Juno’s doctor, then routed to India to be transcribed and re-turned to the hospital within 24 hours. But the transcribed document had not been reviewed by the doctor and it “contained multiple critical errors,” Finkbohner said.

Most importantly, instead of stating that Juno’s dosage of Levemir insulin was 8 units, the dosage was written as 80 units.

Juno received the incorrect dosage at Mercy Medical on March 19, 2008. The overdose caused an irreparable brain injury and cardiopulmonary arrest.

Juno never regained consciousness and died on March 27, 2008.

Contractors and sub-contractorsTo figure out what went wrong, Fink-

bohner spent four years following the trail of the transcribed documents, which led him around the country – for depositions in Arizona, Florida, Louisiana, Pennsylva-nia and Texas – and beyond, with a visit to India.

He learned Thomas Hospital had origi-nally outsourced its transcription work

to Precyse Solutions, a United States-based company.

But in 2007, the hospital agreed to the company’s use of its international arm to perform some work. That international arm is a shell company with no employ-ees that in turn sub-con t r ac t ed with two Indian companies, Me-dusind Solutions in Mumbai and Sam Tech Datasys in New Delhi.

The deal “saved the hospital 2 cents per line,” on its transcripts, Finkbohner said.

Finkbohner traveled to India to depose the individuals who transcribed Juno’s in-formation, but Sam Tech refused to make its employees available, in violation of court orders from both the United States and India.

The company did not appear at trial in its defense.

More than 30 witnesses appeared during the two-week trial, mostly on the plaintiff ’s side. Six former Precyse Solutions employ-ees told jurors about the “awful quality” of the Indian transcription companies, Fink-bohner said.

Precyse said it required all of its sub-contractors to follow the quality standards of the American Association of Medical Transcriptionists. But Medusind argued they were not told to follow the standards and never received them, Finkbohner said.

Instead, he said, they followed a different set of standards that a plaintiff ’s expert tes-tified was “one-half to one-twelfth of the U.S. standards, while still delivering tran-scripts to hospitals in the United States for United States patients.”

The plaintiff also presented testi-mony from a former FBI special agent who testified about his efforts to track down the various employees of the Indi-an subcontractors.

Angry jurorsThe defendants engaged in a “we didn’t

do it, somebody else did” game of finger-pointing, Finkbohner said. “The transcrip-tion defendant said it wasn’t their fault because the document was just a draft and should have been reviewed before it was used. The hospital defendant said it wasn’t their fault because they had hired a profes-sional company and their work was sup-posed to be accurate.”

Farchione said that Thomas Hospital was unaware that Precyse Solutions’ inter-national arm had no employees and that it sub-contracted transcription work to other companies, which violated the contract be-tween the parties.

In addition, because Juno had been dis-charged and was no longer a patient at the hospital, there were no protocols in place to get her paperwork to Mercy Medical, he said. The hospital staff was conscien-tiously doing what they could to get Juno into the rehab facility, he said. “This wasn’t just carelessness.”

In speaking with the jurors after the trial, Farchione said they were “very an-gry” at the Indian transcription companies. The Indian companies “didn’t follow the U.S. standards [for transcription.] One of the companies refused to appear and de-fend itself or allow the plaintiff to depose its employees and filed a false affidavit with the court,” Farchione said. “You start

Continued from page 1

Anger over outsourced medical transcription errors yields $140MPlaintiff’s attorney: Skip Finkbohner, Toby Brown, Brian Duncan and David Wirtes of Cunningham Bounds LLC in Mobile, Ala.

Defense attorney: Joseph A. Farchione of Wheeler Trigg in Denver for Thomas Hospital; Rodney Cate and Michael C. Niemeyer of Hand Arendall in Mobile, Ala. and Russell C. Buffkin of Helmsing, Leach, Herlong, Newman & Rouse in Mobile, Ala. for Medusind; Regina Ford Cash and Danny Collier of Luther, Collier, Hodges & Cash in Mobile, Ala. and Julian B. “Buddy” Brackin of Brackin, McGriff and Johnson in Mobile, Ala. for Precyse Solutions.

The case: Juno v. Amare; Dec. 13, 2012; Circuit Court of Baldwin County, Ala.; Judge Robert E. Wilters.

SKIP FINKBOHNER

Continued on page 8

Go to books.lawyersweekly.com or call 1-800-451-9998 today!

Lawyers Weekly Books

Page 3News LAWYERS USA WEEKLY UPDATE | SATURDAY, DECEMBER 29, 2012

Even though Judge Renee P. Dupuis took the unusual step of attaching $1.5 million of the brothers’ real estate hold-ings and bank accounts after finding the dealership had a substantial likelihood of success on the merits, she declined to is-sue a preliminary injunction curbing their speech based on the First Amendment’s prior restraint doctrine.

Scott Silverman of Newton, Mass., who represents the dealership, said the judge’s decision to attach the assets vindicates his client.

But Dupuis’ failure to quickly end the harm with an injunction exposed a major problem with the law, he said.

“The prior restraint doctrine is simply too broad and does not accommodate the ease with which people can disseminate messages on the Internet,” he said. “The law needs to be adjusted because under the right circumstances, where we can make the kind of showing we made here, an in-junction is the only way to stop this kind of thing from occurring.”

Silverman said it is insufficient to tell a defamed business that its sole recourse is to seek a post-trial monetary award.

“I don’t know what the solution is to this problem,” he said. “But it can’t be that you have to wait for a money award after trial, particularly where some of the people who post this stuff don’t have the kind of assets to cover the damages caused by communi-cations that reach hundreds of thousands of people with the click of a smart phone.”

Pre-InternetSilverman said the brothers’ social me-

dia campaign produced its desired result: Several dealership employees received threatening and disturbing emails from their followers.

The brothers asserted in numerous post-ings that their sister was fired because she had cancer, that the dealership had a policy of discriminating against cancer pa-tients, and that it engaged in other unethi-cal practices.

At least one picketing protest occurred at the dealership, he said. Many followers also pledged online to stop doing business

with Clay Nissan and to encourage others to do the same.

“That makes it different from a typical libel case where a plaintiff ’s arguments on damages are more speculative,” Silver-man said. “In this case, we produced direct evidence at the hearing about the damage caused by the lies they were telling, and because of that we believed it was a case where an injunction was warranted.”

But Leonard E. Milligan III of Bos-ton, who represents the brothers, said the postings were made in good faith. Mil-ligan said his clients lawfully created the sites to promote free-speech rights under the Constitution.

The underlying facts are the subject of a pending state discrimination proceeding brought by the sister, he said. A finding in her favor would undercut claims that the brothers defamed the dealership, he added.

“In the meantime, these are working-class people who’ve now had the bank ac-count they use to pay their bills attached,” Milligan said. “It’s an incredibly chilling outcome, because what you have are peo-ple with no economic interest in a case being punished for expressing what were their honest beliefs about why their sister was fired.”

Jonathan M. Albano of Boston’s Bing-ham McCutchen, a First Amendment lawyer who is not involved in the suit, said the policy reasons in support of upholding the prior restraint doctrine are not impact-ed by the Internet.

“The system works in a way that the plaintiff has to first win a case on the mer-its before the speech can be punished,” he said. “I hear what [the plaintiff ] is saying in the sense that it’s easier today to dissem-inate this kind of information than it was pre-Internet. But when the concept of pri-or restraint was created, the town crier, the handbill and the leaflet were devastatingly effective means of communication, and all of the reasons that existed back then for not chilling speech exist today.”

Robert A. Bertsche of Prince, Lobel, Tye in Boston, who teaches communications law at Boston College, said there is no question that judges across the country are struggling with this issue. A federal judge

in Michigan entered an order in May per-manently enjoining a defendant from pub-lishing allegedly defamatory statements on a website, he said, and the parties to a libel suit in California agreed to an injunction. Courts in Connecticut and Ohio have also recently addressed the question.

“If you look at decisions from around the U.S., you’d find the courts of appeal, who are the ultimate decision-makers here, are upholding the doctrine that you can’t get a prior restraint against libel,” Bertsche said. “But the fact that there are lower court de-cisions going the other way is evidence of the sympathy judges have for the apparent ease with which a defamatory comment might be taken down.”

Facebook followingAt the end of a two-day evidentiary

hearing on the preliminary injunction mo-tion, Dupuis found the defendants’ sister, Jill Colter, had interviewed for a job with Clay Nissan in 2011.

Although she informed the dealership she had cancer and would need to take time off for medical appointments, the in-formation was not an impediment to her hiring, the judge said.

Dupuis noted that within a few months, Colter’s supervisor spoke to her about her interactions with customers, which the dealership did not believe were acceptable at work.

When Colter’s illness recurred 10 months after she was hired, the company allowed her to take paid leave. She re-turned in May, and the judge concluded that several other incidents involving her behavior took place, which formed the ba-sis of the dealership’s decision to fire her.

The judge said two other employees in Colter’s department had cancer, both of whom had been fully supported by the company.

Soon after learning of the firing, the de-fendants engaged in what Dupuis described as a far-reaching, “extremely aggressive” so-cial media campaign that harshly criticized the dealership for terminating their sister “because she had cancer.” A “Boycott Clay Nissan” Facebook page generated 50,000

Continued from page 1

Defamation case exposes social media controversy

Continued on page 8

You can link to the full text of the opinions digested on this page by going to www.lawyersusaonline.com and searching the Lawyers USA website.

Page 4Top opiNioNs LAWYERS USA WEEKLY UPDATE | SATURDAY, DECEMBER 29, 2012

ATTORNEYSLawyer may be barred from avoiding fee split

A class action lawyer may be equitably estopped from claiming that a fee-sharing contract is unenforceable due to non-compliance with state rules, the Califor-nia Court of Appeal has ruled in revers-ing judgment.

The plaintiff is a law firm that referred a potential class action to the defendant, a class action specialist. The parties executed a written fee agreement guaranteeing the plaintiff one third of any legal fees recov-ered in the case. The defendant ultimately obtained a settlement in the case that yielded a $13.5 million award of attor-ney fees.

When the plaintiff sued to enforce its fee-sharing agreement, the defendant argued that the contract was unenforce-able because it failed to comply with state rules governing such agreements. The trial judge found the agreement unenforceable because it failed to comply with a profes-sional rule of conduct requiring the client’s informed, written consent to fee-sharing,

and another rule requiring an applicant seeking court approval of a class action settlement to inform the court of any fee-sharing agreement.

But the appellate court held that “an attorney may be equitably estopped from claiming that a fee-sharing contract is un-enforceable due to noncompliance with [the rules], where that attorney is respon-sible for such noncompliance and has un-fairly prevented another lawyer from com-plying with the rules.”

The court found that equitable estoppel may apply in this case based on evidence that the defendant wrongfully prevented the plaintiff from complying.

“Here, plaintiff offered to prove that it tried to comply with [the rules], but that [the defendant] prevented it from doing so. Plaintiff obtained [the original class rep-resentative’s] written consent to the refer-ral fee. But [the defendant] subsequently replaced [him] with new class representa-tives. [The defendant] then threatened to bring a tort lawsuit if plaintiff contacted the new representatives,” the court said.

California Court of Appeal, 4th District. Barnes, Crosby, Fitzgerald & Zeman v. Ringler, No. G045872. Dec. 19, 2012. Law-yers USA No. 993-3692.

Lawyer may be negligent despite unsettled law

A lawyer could be liable for malpractice even though his alleged error in judgment related to an unsettled area of the law, the Alaska Supreme Court has ruled in revers-ing a dismissal.

The defendant represented a bar sued under the state’s dram shop law for serving a visibly intoxicated man alcohol before he went out and murdered a woman. After a $950,000 judgment was entered against it, the bar sued the defendant for malpractice. According to the bar, the defendant was negligent for failing to join the murderer in the dram shop case for allocation of fault.

The defendant argued it could not be

said that he breached the standard of care because the state’s dram shop case law was unsettled as to whether alcohol sellers could apportion fault to consumers.

But the court held that an attorney can be held liable for an error in judgment re-garding an unsettled area of the law.

“[W]here the law is unsettled – as it was here – there is at least a viable claim that the standard of care requires the attorney to advise a client to follow the reasonably prudent course of action in light of the un-certainty,” the court said.

Alaska Supreme Court. L.D.G., Inc. v. Robinson, No. S-14427. Dec. 14, 2012. Lawyers USA No. 993-3690.

BUSINESSProperty manager not covered by Fair Debt Act

A property management company which collected unpaid assessments on behalf of a homeowners association was not subject to the requirements of the Fair Debt Collec-tions Practices Act, the 11th Circuit has ruled in affirming judgment.

The plaintiffs are homeowners in a Geor-gia townhouse community. The defendant is a property management company that contracted with the plaintiffs’ homeowners association to provide various services, in-cluding the collection of the homeowners’ monthly assessments.

The plaintiffs sued, alleging that the de-fendant violated the FDCPA by suspend-ing their water service when they failed to pay their overdue assessments.

But the court held that the defendant fell within the scope of an exemption in the FDCPA for entities “collecting or at-tempting to collect any debt owed … an-other to the extent such activity is inciden-tal to a bona fide fiduciary obligation.”

In explaining why the exemption ap-plied, the court said that, under Georgia law, the defendant owed a fiduciary duty

Continued on page 5

VISIT US ONLINE.

lawyersusaonline.com

You can link to the full text of the opinions digested on this page by going to www.lawyersusaonline.com and searching the Lawyers USA website.

Page 5Top opiNioNs LAWYERS USA WEEKLY UPDATE | SATURDAY, DECEMBER 29, 2012

as the association’s agent, and the collec-tion of unpaid assessments was incidental to that duty.

“Everything that [the defendant] did pursuant to the management agree-ment – including the collection of unpaid assessments and the enforcement of the amendment to the Association’s governing declarations – was as the agent of the as-sociation,” the court said.

U.S Court of Appeals, 11th Circuit. Har-ris v. Liberty Community Management, Inc., No. 11-14362. Dec. 19, 2012. Lawyers USA No. 993-3693.

CIVIL RIGHTSADA doesn’t preempt award of attorney fees

The Americans with Disabilities Act does not preempt a state law mandating an award of attorney fees to a storeowner who prevailed in a disability access action, the California Supreme Court has ruled an $118,000 award.

The defendant is the owner of a small grocery store. The plaintiff is a wheelchair user who sued the defendant under both the ADA and state disability discrimi-nation law. According to the plaintiff, a four-inch step located at the entry of the store was an architectural barrier that vio-lated the disability access provisions of those statutes.

The defendant prevailed in the case by showing that removal of the barrier was not readily achievable. In addition, the trial court awarded the defendant his at-torney fees under §55 of the California Civil Code, which provides for prevailing party fees in actions to enjoin disability ac-cess violations.

Addressing a threshold issue, the state supreme court ruled that §55 mandates at-torney fees for every prevailing party.

Moreover, the court rejected the plain-tiff ’s argument that the state law was

preempted given that the ADA makes fee awards discretionary and restricts recovery to those defending frivolous claims.

“Nothing in the prospect of owing at-torney fees under §55 could have deterred [the plaintiff ] from invoking his federal ADA rights here. He asserted them, and the trial court concluded they had not been impaired, a conclusion [the plaintiff ] has not challenged. Nor will the fee award chill [the plaintiff ] or others from asserting ADA rights in the future. It may inspire reluctance to invoke §55 rights, but that is a matter for the [California] Legislature to consider; it is no concern of Congress’s, and it is no basis for finding preemption,” the court said.

It noted a contrary decision from the 9th Circuit.

California Supreme Court. Jankey v. Lee, No. S180890. Dec. 17, 2012. Lawyers USA No. 993-3688.

CRIMINALOfficers couldn’t ask about guns during traffic stop

New York police officers conducting a lawful traffic stop needed a “founded sus-picion of criminality” before asking the ve-hicle’s occupants whether they were armed, New York’s highest court has ruled.

Three police officers on patrol stopped the defendant’s car when they observed that he had a broken brake light. In ad-dition to the defendant, there were four other males in the vehicle. Sensing that the men were nervous, the police asked if any-one had a weapon. A passenger admitted that he had a knife. When police ordered the men out of the vehicle to conduct a pat down for other weapons, an officer ob-served what appeared to be a gun wedged against a seat. Police recovered an air pistol and air rifle when they searched the ve-hicle. This discovery led to misdemeanor weapons charges against the defendant.

The defendant moved to suppress under

a state rule that police must have a “found-ed suspicion of criminality” before con-ducting pointed questioning during the course of an investigative stop. The court here decided that the general rule applied to police questioning concerning weapons.

“Whether the individual questioned is a pedestrian or an occupant of a vehicle, a police officer who asks a private citizen if he or she is in possession of a weapon must have

founded suspicion that criminality is afoot,” the court said.

In this case, the court determined there was no founded suspicion to justify the of-ficers’ weapons inquiry.

However, it remanded the case for the lower courts to consider the state’s alter-native argument that the air guns were admissible under the inevitable discov-ery doctrine.

New York Court of Appeals. State v. Gar-cia, No. 205. Dec. 18, 2012. Lawyers USA No. 993-3699.

Student didn’t have right to ‘Miranda’ warning

A high school student’s Miranda rights were not violated when a vice principal in-terrogated him in the presence of a police officer, the New Mexico Court of Appeals has ruled in affirming a conviction.

The defendant’s teachers brought him to be questioned by the school’s vice principal when they suspected him of being intoxi-cated. The vice principal called for a police officer to be present, both to administer a breath test and to protect her in the event the defendant became violent. In answer-ing the vice principal’s questions, the de-fendant said he drank two shots of pep-permint schnapps in a school bathroom. After a breath test indicated that the de-fendant had a blood alcohol content of .11 percent, he was placed under arrest and charged with being a minor in possession of alcohol.

Continued from page 4

Continued on page 6

You can link to the full text of the opinions digested on this page by going to www.lawyersusaonline.com and searching the Lawyers USA website.

Page 6Top opiNioNs LAWYERS USA WEEKLY UPDATE | SATURDAY, DECEMBER 29, 2012

Continued from page 6

Continued on page 6

The defendant moved to suppress evi-dence that he had admitted to drinking alcohol, arguing that his interrogation by a school official in the presence of police triggered his right to Miranda warnings.

But the court concluded that the passive presence of the police officer did not trans-form the vice principal’s encounter with the defendant into a custodial interroga-tion that necessitated Miranda warnings.

Moreover, the court concluded that the defendant’s rights were not violated under a state law requiring Miranda warnings when a juvenile is subjected to an “investi-gatory detention.” The court explained that a school administrator has a “legitimate interest in preserving the safety and har-mony of a school zone and its occupants. It is important to a school administrator to know if a child is intoxicated and whether drugs or alcohol were accessible to other students. We cannot say that [the vice principal in this case] acted in some capac-ity beyond the scope of her employment to specifically aid law enforcement efforts. [State law] does not require that [the de-fendant] be given Miranda warnings in this case,” the court said.

New Mexico Court of Appeals. State v. An-tonio T., No. 30-827. Dec. 13, 2012. Law-yers USA No. 993-3698.

Search of arrestee’s cell phone constitutional

Police didn’t violate the Fourth Amend-ment when they briefly scanned the con-tents of a drug suspect’s cell phone follow-ing his arrest, Massachusetts’ highest court has ruled in affirming the denial of a mo-tion to suppress.

Police observed the defendant engaged in apparent street drug transactions. Rec-ognizing that the defendant had outstand-ing warrants, they placed him under arrest. At the police station, an officer briefly checked the call log of the defendant’s cell phone and discovered that he had received

several calls from a woman who appeared to buy cocaine from the defendant just be-fore his arrest.

The defendant argued that the warrant-less search of the contents of his cell phone violated the Fourth Amendment.

The court disagreed, concluding that “where the defendant agrees his arrest was lawful and does not appear to challenge the seizure of his cellular telephone incident to that arrest, and where the officer per-formed only a limited search of the cellular telephone’s recent call history for evidence directly relating to the crime for which the defendant was arrested, the defendant’s motion to suppress properly was denied.”

The court reached a similar conclusion in a companion decision issued the same day.

Massachusetts Supreme Judicial Court. State v. Phifer, No. SJC11242. Dec. 5, 2012. Lawyers USA No. 993-3694.

EMPLOYMENTBoss’s contradictory statements show pretext

A supervisor’s admission that an em-ployee never should have been fired was sufficient to show pretext in an age dis-crimination suit, the 11th Circuit has ruled in reversing a summary judgment.

The plaintiff worked for Takeda Phar-maceuticals. The company fired her when she was 49 years old. According to Takeda, the plaintiff lost her job because she violat-ed strict company policies against provid-ing gifts to doctors to induce sales of the company’s products.

The plaintiff sued under the Age Dis-crimination in Employment Act, claiming she was a victim of age discrimination.

Takeda argued that it was entitled to judgment because the plaintiff could not show that the company’s proffered nondiscriminatory reason for her firing was pretextual.

The 11th Circuit disagreed, explain-ing that under the Act, “a contradiction

of the employer’s proffered reason for the termination of an employee is sometimes enough, when combined with other evi-dence, to allow a jury to find that the fir-ing was the result of unlawful discrimina-tion. …

“In this case, the corporate executive who terminated the plaintiff for alleged misconduct later said that the plaintiff was an exceptional employee who had done nothing wrong, had done everything right, and should not have been fired. We hold … that such evidence, when combined with a prima facie case, lets the plaintiff get to a jury on her age discrimination claim.”

U.S. Court of Appeals, 11th Circuit. Kragor v. Takeda Pharmaceuticals, No. 11-16052. Dec. 20, 2012. Lawyers USA No. 993-3697.

State workers can sue for retaliation

State workers did not need to be actu-ally affiliated with a particular party or candidate in order to pursue First Amend-ment claims for political-affiliation retali-ation, the 6th Circuit has ruled in revers-ing judgment.

The plaintiffs worked as racing stew-ards for the state of Michigan. They sued the state, alleging that they experienced political-affiliation retaliation in violation of their First Amendment rights. Accord-ing to the plaintiffs, they suffered various forms of retaliation, including termination, because their Democratic bosses were un-happy with their support for the Republi-can party and the Republican candidate for governor in the 2006 election.

The state argued that the plaintiffs could not pursue such a claim because they had no actual affiliation with the Republican party or the party’s candidates.

But the 6th Circuit held that retaliation based on perceived political affiliation is actionable under the political-affiliation retaliation doctrine.

“There is ample evidence to support the

You can link to the full text of the opinions digested on this page by going to www.lawyersusaonline.com and searching the Lawyers USA website.

Page 7Top opiNioNs LAWYERS USA WEEKLY UPDATE | SATURDAY, DECEMBER 29, 2012

Continued from page 7

Continued on page 7

stewards’ contention that [their bosses] at-tributed a political affiliation to the stew-ards, especially at the prima facie stage. An employer that acts upon such assumptions regarding the affiliation of her employees should not escape liability because her assumptions happened to be faulty,” the court said.

U.S. Court of Appeals, 6th Circuit. Dye v. Racing Commission, No. 11-1828. Dec. 18, 2012. Lawyers USA No. 993-3691.

REAL PROPERTY & ZONINGCondo purchase contract cannot be revoked

The buyers of a luxury condominium unit in New York City could not revoke their purchase agreement on the ground that their developer failed to comply with the disclosure requirements of federal law, the 2nd Circuit has ruled in revers-ing judgment.

Section 1703(d) of the Interstate Land Sales Full Disclosure Act generally per-mits buyers who purchase lots in large, uncompleted housing developments, in-cluding condominiums, to revoke their contracts if the developer fails to provide certain disclosures.

The plaintiffs in this case purchased a luxury condominium unit from the defen-dant. The plaintiffs later sued, alleging that their purchase agreement was revocable because it did not contain “a description of the lot which makes such lot clearly identi-fiable and which is in a form acceptable for recording,” as required under §1703(d)(1). Specifically, the plaintiffs contended their purchase agreement did not comply with §1703(d)(1) because it was not recordable under state law.

But the 2nd Circuit held that §1703(d)(1) only requires the lot description and not the agreement itself to be “in a form acceptable for recording.”

Moreover, the court decided that the lot description at issue satisfied the Act’s requirements.

“[The plaintiffs] altogether fail to iden-tify any material information omitted from the description provided … in the agreement that, by their account, would have made the description otherwise un-acceptable for recording. In this respect, therefore, we emphasize again that the agreement contained a copy of the Draft Declaration. And while that document was not yet recorded at the time the agreement was executed, because construction … was ongoing, the Draft Declaration contained all of the descriptive information required under state law to create the condomini-um,” the court said.

U.S. Court of Appeals, 2nd Circuit. Baco-litsas v. 86th & 3rd Owner, LLC, No. 10-4229-cv. Dec. 19, 2012. Lawyers USA No. 993-3696.

TAXATION & ESTATE PLANNINGTrust beneficiaries have standing to sue trustee

The beneficiaries of a revocable trust had standing to sue the trustee for breach of fi-duciary duty allegedly committed while the settlor was alive, the California Supreme Court has ruled in reversing judgment.

The defendant’s father created a revoca-ble trust, naming the defendant as trustee. The father was the sole beneficiary during his lifetime.

The remainder beneficiaries were the de-fendant’s mother – who was entitled to the benefits of the trust during her lifetime – and the couple’s nine children, who would share equally in what remained after both parents were deceased.

Before his father’s death, the defendant allegedly assisted his father in investing $4 million – approximately two-thirds of the father’s fortune – in a technology company started by the defendant’s twin brother.

The stock from the investment was trans-ferred to the trust. However, by the time of the father’s death several years later, the stock was worth very little due to a down-turn in business.

Four of the defendant’s siblings sued for breach of fiduciary duty, alleging that the defendant in his capacity as trustee had squandered their father’s fortune, both by facilitating the investment in the technol-ogy company, and in making loans from trust assets both to himself and to his twin.

The defendant argued that the siblings lacked standing to sue for conduct that oc-curred while their father was alive and the trust remained revocable.

The court disagreed, holding that “[b]ecause a trustee’s breach of the fiduciary duty owed to the settlor can substantially harm the beneficiaries by reducing the trust’s value against the settlor’s wishes, we conclude the beneficiaries do have stand-ing to sue for a breach of that duty after the settlor has died.”

California Supreme Court. Giraldin v. Giraldin, No. S197694. Dec. 20, 2012. Lawyers USA No. 993-3695.

Slayer’s children can’t inherit under victim’s will

Stepchildren could not inherit under their stepmother’s will after their father was deemed a “slayer” of the woman under state law, the Rhode Island Supreme Court has ruled in affirming judgment.

The two plaintiffs are the stepchildren of a woman who died while scuba diving in the British Virgin Islands. The plaintiff ’s father was charged with murder. During the criminal proceedings in the British Virgin Islands, the victim’s parents sued the plaintiffs’ father for wrongful death in Rhode Island court. A state jury found that he had intentionally killed his wife and therefore met the definition of a “slayer” under state law.

Because the Rhode Island Slayer’s Act

Page 8Top opiNioNs LAWYERS USA WEEKLY UPDATE | SATURDAY, DECEMBER 29, 2012

Continued from page 8

disqualified their father from inheriting as the beneficiary of their stepmother’s estate, the plaintiffs sought to inherit as the only named contingent beneficiaries in her will.

But the state supreme court concluded that the slayer statute cut off the plaintiffs’ inheritance rights as well.

“Here, the clear intent of the Slayer’s

Act is to ensure that a slayer does not benefit from his or her wrongdoing. Thus, although the Slayer’s Act does not specifi-cally include language barring the slayer’s issue from inheriting as contingent benefi-ciaries, the clear and unequivocal direction of the Act requires this Court, based on the facts before us, to interpret it so as to pre-vent the slayer from benefitting. …

“Here, it is undisputed that [the father]

will benefit from murdering [the step-mother] if [the plaintiffs] are allowed to inherit under her will. The plaintiffs have put on the record that they would use any money from their share of the estate to fi-nance their father’s defense, if necessary,” the court said.

Rhode Island Supreme Court. Swain v. Estate of Tyre, No. 2009-297. Dec. 13, 2012. Lawyers USA No. 993-3689.

adding those things together and all of a sudden you can see where a jury would be-come angry.”

With “all the makings of a bonfire, the flames went up and [Thomas Hospital] ended up getting burned,” he said.

$140 million in punitive damagesThe original complaint named seven de-

fendants, including Mercy Medical, one of its nurses and Juno’s doctor.

Although these defendants were dis-missed voluntarily by the plaintiff at the close of evidence, Finkbohner included them when he suggested a verdict amount to the jury.

“Given how bad and aggravating the facts were, we felt like $10 million per de-fendant seemed reasonable, so I asked the

jury to return a $70 million verdict,” he said. “They doubled it.”

The 12-person jury deliberated just over an hour before returning the unanimous $140 million verdict.

Alabama law only allows punitive dam-ages in a wrongful death suit, not com-pensatory damages. Jurors were not even permitted to see a picture of the plaintiff, Finkbohner said, which stripped the case of any sympathy factor.

Instead, the trial focused on the “egre-giousness of the defendant’s wrongs,” he said. For jurors to award $140 million, “the conduct of the defendant must be as bad as you can imagine – or worse.”

Just minutes prior to the jury’s verdict, Finkbohner reached a confidential settle-ment with Precyse and Medusind. And the possibility of an agreement between

the plaintiff and the hospital remains, both parties acknowledged.

Regina Cash, a partner at Luther, Col-lier, Hodges & Cash in Mobile, Ala. who represented Precyse Solutions, declined to comment on the case because her client settled prior to the verdict.

Counsel for Medusind, Rodney Cate of Hand Arendall in Mobile, Ala., did not re-spond to a call requesting comment.

followers and urged readers not to do busi-ness with any Clay dealerships.

A separate site encouraged readers to “fight the company that fired the wom-an without cause who is fighting stage four melanoma.”

‘Right to express’Dupuis wrote that the statements were

clearly defamatory, and the plaintiffs had established a reasonable likelihood of suc-cess on each element of their defamation and intentional interference claims.

“Although the Colters claimed on their

website that there were others fired for the same reasons, they have not produced a single shred of documentation to sup-port that claim,” she wrote. “They have de-leted from the websites posts from other Clay employees who reported that Clay was extremely supportive of them in simi-lar circumstances.”

The judge said the posts put the defen-dants on notice that there was a substantial likelihood that their assertions were false. However, the right to express views should not subject people to any prior restraint by the court, she said. “The harm created by restraining speech is a far greater one than

that which can be cured by a monetary award,” she said. “Although plaintiff asserts irreparable injury to its business reputa-tion and economic interests, on balance, at this juncture, defendants present the more compelling argument.”

In a Dec. 7, 2012, order, an appeals court judge concluded that Dupuis had commit-ted no errors of law in attaching the defen-dants’ assets.

However, she reduced the attachment to $700,000.

A version of this article originally appeared in Lawyers USA’s sister publication, Massa-chusetts Lawyers Weekly.

Anger over outsourced medical transcription errors yields $140M

Defamation case exposes social media controversyContinued from page 3

Continued from page 2

LawyersUSARead more news stories

and case digests at lawyersusaonline.com