1. Supreme Court
1. Civil Procedure
2. Court of Appeals
1. Civil Procedure
2. Contracts
3. Employment
4. Improvement To Real Property
5. Insurance
6. Medical Malpractice
7. Products Liability
3. Federal Court
1. Contracts
2. Employment
3. Insurance

4. Minnesota Workers' Compensation
1. Intoxication And Prohibited Act Defenses
2. Medical Treatment
3. Temporary Total Disability
4. Vacation Of Stipulations For Settlement
5. Wisconsin Workers' Compensation
1. There were no updated cases for review as of the printing of this Newsletter.
6. Michigan Workers' Compensation
1. There were no updated cases for review as of the printing of this Newsletter.

7. U.S. District Court

The Supreme Court held that a District Court shall treat a motion to enforce a settlement agreement as it would a motion for summary judgment and explicitly grant or deny each claim. Appellant RPC Properties, Inc. brought a motion seeking enforcement of the settlement agreement with VoiceStream Minneapolis, Inc. There was a five month delay in performance under the settlement agreement which the District Court found was not reasonable. The District Court granted the movant's request for enforcement and for attorney's fees but remained silent as to the movant's request for damages allegedly arising out of the opposing party's delay in performing under the settlement agreement. The Court of Appeals concluded that the District Court's silence on the issue of damages was equivalent to a denial of the request. The Supreme Court concluded that the District Court must explicitly grant or deny the claim for damages.

In this property and conveyances dispute, the Minnesota Court of Appeals held that the statute of limitations on a breach of a right-of-first-refusal agreement begins to run at the time of the alleged breach, even if the holder of the right has no notice of an offer to buy that activates that right. The Court declined to adopt a "discovery rule," recognized in other jurisdictions, to toll the limitations period until the right-holder knew or reasonably should have known that the subject property had been sold. Instead, the Court held that the statute of limitations begins to run when a claim accrues and would survive a motion to dismiss. If the legislature intended to write a discovery requirement into the statute of limitations period, it would have so provided.

In this case applying the law-of-the-case doctrine, the Court of Appeals affirmed the District Court's application of their instructions upon remand. Luedeman hired Metro Paving to construct a driveway between his workshop and home. Luedeman was unsatisfied with Metro Paving's performance and refused to pay for the work. Metro Paving thereafter filed an action to recover the contract price, and Luedeman counterclaimed for the cost of removing the asphalt. Following a bench trial, the District Court concluded that Metro Paving had substantially performed the work agreed to and awarded it the contract price reduced by the cost of curing deficiencies in the work. The Court of Appeals reversed, including the District Court's finding of substantial performance. Luedeman was entitled to damages rather than an offset. The Court of Appeals remanded for an entry of judgment in Luedeman's favor. The Minnesota Supreme Court denied Metro Paving's Petition for Review and Luedeman moved the District Court to enter judgment in accordance with the decision of the Court of Appeals. The District Court granted Luedeman's motion and ordered the entry of judgment. Metro Paving appealed arguing the District Court abused its discretion by following the Court of Appeals' instructions upon remand because that decision was clearly wrong and worked a manifest injustice. The Court of Appeals affirmed the District Court's decision noting that Metro Paving was attempting to relitigate a matter that had already been decided on the merits. While the Court noted that the law of the case is a rule of practice, not a limitation on the power of the court to re-review and overrule a prior decision, it is a rule that the Court adheres to absent compelling reasons to do otherwise. The Court also noted that Minnesota has not expressly adopted the manifest-injustice exception to the law-of-the-case doctrine.

In this default judgment case, the Court of Appeals affirmed the decision of the District Court denying Hunter's motion to vacate the judgment and motion to reconsider. The Court noted that Hunter moved for relief from a forfeiture default judgment upon the grounds of mistake, inadvertence, or excusable neglect, and had a hearing. Plaintiff failed to present any evidence as to the merits of his forfeiture case and did not address the issue of prejudice to the State as a result of the property disbursement. The Court found that Hunter failed to meet his burden for relief under Minn. R. Civ. P. 60.02 and the District Court's decision to deny his motion to vacate the default judgment was legally sound.

In this case the Court of Appeals reversed and remanded a trial court's decision to grant default judgment in a case involving child support payments and custody.

The primary reason for the default judgment was that the defendant failed to appear at a hearing. However, it became clear that the defendant was never informed of the hearing date by his attorney and his attorney did not appear on his behalf. Under the four-factor test, defendant was deemed to have met all four factors sufficiently enough to determine that the District Court had abused its discretion in granting the default judgment. The four-factor test includes: 1) a reasonable claim on the merits, 2) a reasonable excuse for the failure to act, 3) due diligence after notice of judgment, and 4) absence of substantial prejudice to the opponent. The Court of Appeals also reversed the District Court's grant of attorney's fees in this case.

Optometrist Petersen's local ad stating, "Not retired . . . just relocated!" was held to violate the terms of his noncompete agreement with optometrist Sealock, who had purchased Petersen's practice with offices in Mound, Delano, and Watertown, Minnesota. Though noncompetes are "generally looked upon with disfavor," the Court observed that noncompetes require more than the just a restriction against the physical establishment of a practice within the restricted geographic area. The Court prohibited Petersen's local advertisements to protect the goodwill purchased by Sealock.

The Minnesota Court of Appeals affirmed that a one-month lifting restriction after an employee's heart surgery was not a "material limit on a major life activity" and did not meet the definition of "disabled" for purposes of the ADA. The Court observed that simply being hospitalized does not establish a history of impairment under the ADA, nor does the fact of the employee's heart surgery establish that he had a record of impairment. Since employer had offered reasonable accommodations which would have allowed the employee to continue as a supervisor, the employee failed to meet his burden in establishing that he was disabled within the meaning of the MHRA and failed to establish a prima facie case of discrimination.

A subcontractor's employee was injured when he fell through an opening of an air-handling unit (AHU) during construction of a school. Cousineau McGuire's Andrea Reisbord represented the employee's employer in this matter. The Appellate Court concluded that the AHU had been partially installed and was an improvement to real property under Minn. Stat. § 541.051, subd. 1(a) since it had been set into place on a specially constructed concrete pad at its permanent location, even though the connecting work had not been completed. Thus, because the employee failed to bring his action within two years of sustaining injury, his claims against the subcontractors who installed the AHU were barred by the statute of limitations. The Appellate Court further held that the manufacturer of the AHU had no duty to warn of an open and obvious duct opening.

The Court of Appeals held that drop-down automobile insurance policy provisions that reduce bodily injury coverage for resident family members to the minimum statutory amount are valid and enforceable. However, the Court found in this specific matter that the drop-down limit did not apply because the injured family member was a college student who lived with her fianc‚, thus not residing with the covered party under the policy.

The automobile insurance policy in this case provides for reduced liability (drop-down) limits of bodily injury coverage for resident family members. The issue before the Court was whether the insurance policy exclusion is valid and enforceable. The Court found that the policy does not omit coverage required by Minnesota's automobile insurance laws. The drop-down exclusion provides the required minimum coverage of $30,000 of bodily injury coverage for one person in an accident. The policy was also found to not otherwise contravene applicable statutes. The Court also found that the phrase "resident of your household" is not ambiguous and that the drop-down provision does not violate the reasonable expectations of the insured. However, ultimately the Court held that because Aven Frey was not a family member residing with the driver of the vehicle, she was not subject to the drop-down coverage in the policy. Aven was a junior in college in Iowa and only returned to her parent's household for holidays and school breaks. The Court also found that Aven was not living in a close relationship with her family at the time of the accident because she was engaged and living with her fianc‚. Additionally, she was not listed as a part of the household on the policy and, in fact, had a separate Iowa automobile insurance policy listing her as the sole operator on an Iowa vehicle.

In these consolidated appeals, three auto glass shops brought separate arbitration proceedings as purported assignees of the insured policyholders, but the Minnesota Court of Appeals affirmed that a "non-assignment" clause in an insurance policy protects insurers from such claims of assignment of post-loss property insurance proceeds. In each case, the repair companies initiated arbitration after the insurer paid the glass repair company less than the amount billed. Over the insurers' objections, the arbitrators awarded amounts exceeding the sums paid by the insurers. The Court rejected the glass repair companies' argument that public policy dictates the free assignment of post-loss proceeds, held that the purported assignments were void, and affirmed the District Court decisions which vacated the arbitration awards. The District Court, which had confirmed the excess award, was reversed.

The Court of Appeals in this case upheld the District Court's grant of summary judgment to Travelers Indemnity Company on the issue of whether it provided insurance for the acts of Mr. Reiners, an employee of and the sole shareholder, officer and director of Bloomington Steel and Supply Company. During the course of Mr. Reiners' employment, he got into an altercation with Jose Padilla. During the altercation Mr. Reiners hit Mr. Padilla with a 2 x 4 in the head causing a skull fracture and multiple hematomas. The defendants argued that the grant of summary judgment to Travelers was in error because the District Court applied an improper standard. Specifically, the District Court determined, based on statements made by Padilla, that Bloomington Steel and Supply Company was in fact aware of Mr. Reiners' violent propensities in the workplace. The Court of Appeals found this to be outcome determinative because this admission by Reiners created a situation in which there was no genuine issue of material fact to go to the jury. Also pursuant to this admission of Mr. Reiners' violent propensity and it being known by Bloomington Steel and Supply Company, the Court of Appeals agreed that the District Court was correct in finding that the expected acts exclusion of the Travelers Insurance policy precluded coverage for the acts of Mr. Reiners acting as an employee of Bloomington Steel and Supply Company. The Court of Appeals stated that Travelers did not have to prove that Bloomington Steel knew that Mr. Reiners intended to strike Mr. Padilla only that it had actual knowledge of Reiners' propensity for workplace violence.

In this unpublished decision, the Court of Appeals affirmed the District Court's order that the UIM insurer was not entitled to a reduction of the damages award for the workers' compensation benefits that the plaintiff received before his settlement with the workers' compensation carrier because the benefits were an exception for a collateral source "for which a subrogation right has been asserted."

Plaintiff was injured in a motor vehicle accident and received workers' compensation benefits. Plaintiff settled with the other driver and also settled with the workers' compensation carrier for additional benefits for which he claimed he was entitled and the carrier assigned its subrogation rights to the Plaintiff against the other driver in exchange for reduced benefits. Plaintiff brought a lawsuit against the UIM carrier. Allstate argued that it was entitled to a reduction of the damages award for workers' compensation benefits that the plaintiff received before his settlement with the workers' compensation carrier. The Court held that the plaintiff gave valuable consideration for the subrogation rights and giving effect to the assignment under the collateral-source statute did not result in a double recovery or windfall to the plaintiff.

The Court of Appeals upheld the District Court's grant of summary judgment to the insurer in a claim for proceeds under a crime insurance policy. Plaintiff made numerous loans to a person who dealt with houses in foreclosure by renovating them and selling them for a profit. Plaintiff loaned money to the person and most of the loans were repaid with interest except for three that were not satisfied. The purported security on the loans was illusory. The Court held that there was no coverage under the robbery provision of the policy because the policy covered robbery through "obviously unlawful" acts. The Court concluded that there was no "robbery" as that term is defined in the insurance policy because the underlying acts were not "obviously unlawful" at the time they occurred.

The Court of Appeals affirmed the District Court's decision to grant summary judgment in favor of the emergency room doctor in this medical malpractice action which alleged that respondents' hospital and physician failed to evaluate decedent adequately and admit her under a 72-hour hold. On March 18, 2003, a St. Cloud police officer was dispatched after the decedent reported a suspicious vehicle in the store parking lot that appeared to be "casing" other cars. The officer did not locate this car but again received a similar call from decedent at 11:45 p.m. on the same day from a different parking lot. The decedent appeared "very emotional," and believed that her husband had hired someone to kill her. The police contacted decedent's 17 year old daughter who informed them that decedent had been diagnosed with bipolar disorder and was allergic to prescribed medication. The officers transported decedent to St. Cloud Medical Hospital for further mental-health evaluations. The police were told by a friend of decedent's that the decedent believed that her ex-husband was trying to kill her, had previously received treatment at a mental hospital, and was possibly bipolar. One of the officers applied for a 72-hour hold under Minn. Stat. § 253B.05, subd. 2(a) (2002). A nurse then interviewed decedent who told the nurse that she had fibromyalgia and a mental-health reaction to prednisone, but no other health history. The nurse initially noted on decedent's chart a history of bipolar disease, but crossed out the notation and wrote "error" when decedent denied it. The nurse reported her observations to the emergency room physician, Dr. Windschitl, who then met with the patient. The doctor recalled a small part of his visit with decedent including that she was "very pleasant" and "made very good eye contact." After his visit with decedent, he did not believe that decedent was psychotic or required to be kept on a hold. He directed the hospital to call a cab and take decedent to her hotel and to follow up with her physician.

A few days later, decedent was killed while driving her vehicle in an erratic manner, pulling out into oncoming traffic, and finally colliding head-on with another vehicle. Appellant filed a complaint alleging that the emergency room doctor negligently failed to evaluate decedent under Minn. Stat. § 253B.05, subd. 3(b) (2002); failed to admit her; failed to have her further evaluated; and St. Cloud Hospital negligently failed to communicate decedent's mental-health status to the doctor and failed to accurately report the necessary facts presented by the officers. The District Court granted respondents' motion for summary judgment. The Court held that plaintiff's expert opinions that decedent was in a manic state at the time of her accident were unsupported plaintiff's expert opinions were speculative because decedent was alone at the time of the accident and the experts never examined decedent. The appellant attempted to argue that the Frye-Mack evidentiary test was improperly used to determine causation. However, the Court of Appeals found that the District Court did not improperly use the Frye-Mack test to determine causation and that the appellant failed to establish any real link between the emergency room doctors' conduct and decedent's accident.

The Appellate Court affirmed the District Court's decision to dismiss an action against an assisted living facility for medical malpractice as a result of the trustee for the heirs failing to provide an expert-disclosure affidavit. The claim in the case was that an elderly woman who suffered from dementia living in the assisted living facility which required that the facility "assist with bath/shower," was found unconscious on the floor of her shower under hot running water at 2:30 a.m. and later died. The Court concluded that a claim for medical malpractice is not exempt from the expert-affidavit requirement because to prove negligent supervision, the trustee would have been required to establish that the facility violated the appropriate standard of care.

A student at St. Olaf College suffered serious burns when attempting to quench a flask under a fume hood containing an unknown chemical compound, the flask exploded, spraying chemical debris and igniting the student's clothes. The student sued the companies that manufactured, distributed and installed the fume hood. The Appellate Court concluded the District Court did not err in granting summary judgment for the companies, as the student failed to show material facts showing a casual link between any defect in the fume hood and the exploding flask.

The above facts were also considered separately in a workers' compensation context. St. Olaf and the student's professor argued that the Minnesota Workers' Compensation Act provided the student's sole remedy because he was "employed" with the school at the time, as the student was paid a $3,500 stipend and allowed to reside in a campus dorm. However, the Appellate Court upheld the District Court's ruling that there were genuine issues of material fact regarding whether the student was an "employee" because it was unclear whether the work performed by the student was in fact benefitting the school or the student.

In this case, Blackwater Technologies sought injunctive relief against individual officers of another corporation alleging fraud, breach of contract, promissory estoppel, unfair competition, negligent misrepresentation, and violation of the Minnesota Deceptive Trade Practices Act (MDTPA). The Federal Court dismissed Blackwater's claims for unfair competition and violation of the MDTPA because the officers' company no longer operated as a business, and was not likely to inflict harm upon Blackwater in the future. It also dismissed Blackwater' s claim for negligent misrepresentation because a document attached to the Complaint affirmatively rebutted Blackwater's allegation.

The District Court found that ERISA preempted plaintiff's state law claims of intentional and wrongful denial of benefits, breach of contract, negligent advice, as well as claims under the doctrines of reasonable expectations, illusory coverage, and promissory estoppel. Accordingly, the plan administrator has discretionary authority under ERISA to determine eligibility for benefits or to construe the terms of the plan. The District Court found no abuse of discretion in Hartford's denial of life insurance benefits because the decedent had not been on the payroll for six months and there was no record before the plan administrator of present work for Atrix, therefore the decedent was not an eligible employee according to plan criteria.

The Eighth Circuit Court of Appeals affirmed that plaintiffs/claimants must itemize damages when settling with an insured on a judgment for an amount collectible from the insurance policy. The District Court granted summary judgment to defendants/insurers Continental Casualty Company and Lumbermens Mutual Casualty, determining that the insurance policies did not cover all of the claims and concluding that the Miller-Shugart settlement was unreasonable because claimant Corn Plus and insured Wanzek Contruction had failed to allocate between covered and noncovered damages. For public policy reasons, the Court also refused to enforce an addendum to the settlement agreement, which purported to empower a court to determine a reasonable settlement amount if it found the agreement unenforceable. The Eighth Circuit affirmed these decisions and declined to reinstate the litigation underlying the settlement between Corn Plus and Wanzek.

The Workers' Compensation Court of Appeals affirmed the Compensation Judge's finding that the employee was not intoxicated or engaged in a prohibited act at the time of his injury. In this matter, the employee was 27 years old and had worked as a roofer since 19. According to the record, he drank alcohol, smoked marijuana and used cocaine since the age of 17, with the exception of a two year absence. He admitted to smoking marijuana about once or twice a week during the aforementioned time period on a regular basis and also snorting cocaine about once or twice a year. On the date of injury, his foreman gathered his crew, including the employee, together and reminded all employees to stay away from the edge of the roof in which they were working on. While working on the edge of the roof, the employee fell and sustained injuries. While in the hospital, his urine tested positive for cocaine and marijuana metabolites. Pursuant to Minnesota statute, if an employee's intoxication at the time of injury was the proximate cause of his injury, the employer is not liable for compensation. The compensation judge found, and the Workers' Compensation Court of Appeals affirmed, that the employee was an experienced roofer, with a good work record and no history of prior injury. He slipped due to weather conditions and hurrying on the job as opposed to chronic marijuana use. The compensation judge accepted the employee's testimony that he slipped due to weather conditions, not due to any alleged or even real intoxication.

The WCCA also affirmed the compensation judge's finding that the employee's injury did not result from the performance of a prohibited act. Under the prohibited act doctrine, an intentional violation of a simple order or prohibition by the employer may take the employee outside the scope of his employment. More specifically, where an employer expressly prohibits the doing of a certain specific act, the disregard of which is not reasonably foreseeable to the employer, a violation thereof takes the employee outside the scope of his employment and injuries resulting therefrom are not compensable. In order for the exclusion to be found, there must be an unequivocal and specific prohibition which is clearly communicated to the employee and which has been enforced by the employer. In this matter, the compensation judge found, and the WCCA affirmed, that not all of the employer's safety practices or devices were used all of the time in situations that might require them. The compensation judge noted that working near the edge of a roof was part of the employee's regular work duties. He performed this type of activity hundreds if not thousands of times previously. The compensation judge did not view the foreman's instruction that crew members were to avoid working near the edge of the roof on the day of the injury to be something permanently applicable to performance of the roof but more like a temporary directive. The compensation judge implicitly concluded that he viewed the employee's transgression of the employer's safety rule and his foreman's instruction on the day of injury as not the type of violation that would preclude benefits under the prohibited act doctrine.

In this matter the employer and insurer appealed from the compensation judge's finding that surgery in the nature of a one-level fusion at the L5-S1 level would constitute reasonable and necessary medical treatment that is causally related to the employee's work-related back injury of September 6, 2005.

The employee sustained a personal injury to her low back on September 6, 2005, arising out of and in the course of her employment with the employer. Following this incident, she testified that she developed severe stabbing pain above her tailbone that extended into her right side but not into her legs. After conservative treatment methods failed, she was referred to Dr. Richard Salib, an orthopedic surgeon, who diagnosed a degeneration of the L5-S1 disc. Dr. Salib initially treated the employee with Celebrex and administered an intra-articular injection to the facet joint for diagnostic and therapeutic purposes. The employee underwent the injection and was provided approximately one week's relief. Dr. Salib then recommended the employee undergo a bilateral radial frequency neurotomy at the L5-S1 level. Following the procedure the employee reported 50% reduction in her low back pain, but her symptoms eventually returned.

On October 5, 2006, the employee underwent a lumbar discogram at three levels as well as a lumbar CT scan. The CT scan showed bilateral subarticular tears at the L4-5 and L5-S1 levels, anterior and lateral tears at the L5-S1 level and mild bilateral foraminal narrowing at the L5-S1 level. Dr. Salib interpreted the lumbar discogram and CT scan as showing a painful and degenerative disc at the L5-S1 level. He acknowledged that the L4-5 disc level showed an annular tear although it was not painful, and that the L4-5 disc had appeared normal on an earlier MRI scan.

Based upon these findings, Dr. Salib in a chart note dated October 12, 2006, proposed the employee undergo either an anterior spinal fusion at the L5-S1 level, or an anterior total disc replacement at the L5-S1 level with ProDisc. Dr. Salib indicated he preferred the second alternative rather than the proposed anterior spinal fusion at the L5-S1 level because there could be a slightly higher risk of transferring stress to the L4-5 disc if he performed such a fusion.

During his deposition, Dr. Salib explained that the employee's pain originated at her L5-S1 level, but that she also had an injury to the L4-5 level, which he could not definitely identify as being related to her work injury. He further testified that his October 12, 2006, surgical recommendations contained a typographical error and that he had intended to recommend the employee undergo either an anterior fusion at the L5-S1 level and an anterior total disc replacement with ProDisc at the L4-5 level, or an anterior/posterior fusion surgery of the L5-S1 and L4-5 levels.

The matter came on for hearing on May 16, 2007, before a compensation judge to address the employee's Medical Request for low back surgery. In his Findings and Order served and filed on July 17, 2007, the compensation judge found that the employee's work-related injury of September 6, 2005, remains a substantial contributing factor to her low back condition. The compensation judge further discussed three alternative surgical procedures, and concluded that the two types as alternatively proposed by Dr. Salib in his deposition testimony, would not constitute reasonable, necessary and causally related treatment. He, therefore, in an unappealed finding, denied the employee's claims for authorization for either one of those surgeries.

The compensation judge, however, found that a third type of surgery, a single-level fusion at the L5-S1 level, would represent reasonable and necessary treatment for the cure or relief of the employee's September 5, 2006, work injury. The employer and insurer appealed from the compensation judge's authorization for the surgery in the nature of a one level fusion at the L5-S1 vertebral level. They argued that this particular type of surgery was not at issue at the hearing, and that the compensation judge cannot award treatment that was not at issue at the hearing and is prospective in nature. They further argued that it was error for the judge to address a type of surgery neither requested by the employee nor recommended by the employee's treating surgeon, and that was an improper expansion of the agreed-upon issues.

The Workers' Compensation Court of Appeals (WCCA) noted that the issues to be addressed at the hearing were not specifically delineated by the parties prior to the Hearing. However, during opening statements, the WCCA noted the employee's attorney advised the compensation judge that the "issue before the Court is whether or not Diane Crockett is a low back surgical candidate," and that "the only thing we're here on is to decide whether or not Diane Crockett is entitled to surgery, reasonableness and necessity of the surgery and whether she can have it as outlined in the deposition of Dr. Salib." They further noted that Counsel for the employer and insurer also addressed only the reasonableness and necessity of the two types of surgery as proposed by Dr. Salib during his deposition.

The WCCA did not find an improper expansion of the issues by the compensation judge and found that he did not err by addressing various types of surgery recommended by Dr. Salib other than the one listed in his October 12, 2006, chart note.

The WCCA then went on to examine the issue of whether the compensation judge erred by awarding a surgery that neither Dr. Salib nor any other physician had recommended, and which the compensation judge described as "the mentioned but not yet recommended surgery, in the nature of a fusion of the L5-S1 alone." In his Memorandum, the compensation judge provided that if Dr. Salib recommended the employee proceed with fusion surgery solely at the L5-S1 level, then the employer and insurer shall pay the surgery as and for medical treatment that is reasonable and necessary due to, and causally related to, the employee's work-related back injury of September 6, 2005. The WCCA found this finding to be in error. They indicated that "absent a medical opinion recommending a single-level fusion, the compensation judge's contingent award for that type of surgery is premature and unsupported by the medical evidence, and must be vacated." Thus, they vacated Finding No. 7 and Order No. 3.

In this matter, the employer and insurer appealed from the compensation judge's award of temporary total disability benefits, arguing in part that the judge erred in concluding that the employee was not discharged for misconduct within the meaning of Minn. Stat. § 176.101, subd. 1(e)(1).

Pursuant to Minn. Stat. § 176.101, subd. 1(e)(1), an employee is not entitled to recommencement of temporary total disability benefits if the employee is terminated from employment for misconduct. In defining misconduct, the Workers' Compensation Court of Appeals (WCCA) adopted in Langworthy v. Signature Flight Support, slip op. (W.C.C.A. July 8, 1998), the definition of misconduct as provided in the Minnesota Supreme Court's unemployment decision Tilseth v. Midwest Lumber Co., 295 Minn. 372, 204 N.W.2d 644 (1973).

In his Findings and Order, the compensation judge in the present case determined that the employer terminated the employee for "unsatisfactory work performance and poor attendance" which did not rise to the level of misconduct as defined in Tilseth. The employer and insurer appealed arguing that the Tilseth standard for misconduct had been superseded by a change in the unemployment law. They argued that Minn. Stat. § 268.095, subd. 6, had been revised and now defined misconduct as follows:

Subd. 6. Employment misconduct defined. (a) Employment misconduct means any intentional, negligent, or indifferent conduct, on the job or off the job (1) that displays clearly a serious violation of the standards of behavior the employer has the right to reasonably expect of the employee, or (2) that displays clearly a substantial lack of concern for the employment.

Inefficiency, inadvertence, simple unsatisfactory conduct, a single incident that does not have a significant adverse impact on the employer, conduct an average reasonable employee would have engaged in under the circumstances, poor performance because of inability or incapacity, good faith errors in judgment if judgment was required, or absence because of illness or injury with proper notice to the employer, are not employment misconduct.

The employer and insurer contended that the employee's behavior in the present case should be evaluated under the new definition of misconduct as defined by Minn. Stat. § 268.095, subd. 6.

The WCCA noted that this issue had not been raised at the hearing level and thus was not properly before this Court and will not be addressed. However, the WCCA went on to note that, unlike in the unemployment case law, there had been no pertinent changes in the Workers' Compensation Act that would prompt them to reconsider their adoption of the Tilseth standard. The compensation judges Findings were affirmed.

The Workers' Compensation Court of Appeals denied the employee's Petition to Vacate the Award on Stipulation served and filed on June 22, 1987. The employee argued that the Award on Stipulation should be vacated based on grounds of fraud and newly discovered evidence. Shortly after the employee was injured on July 3, 1986, his brother sent a letter to the employer stating he did not injure himself at work but rather was injured while goofing around. The employee's brother further stated that the employee made matters worse by getting into three car accidents and having "me punch him in the small of his back." In support of his Petition to Vacate, the employee submitted an affidavit from his brother which stated that his brother had been angry with him and had falsely reported to the employer that the employee had not been injured on the job, but rather had injured himself in a waterskiing accident. In the employee's affidavit, also attached to the Petition, he asserted that his brother's fraudulent statements concerning the work-relatedness of his injuries devastated his workers' compensation case and hindered his ability to make a fair monetary recovery for his injuries. He further asserted that he had settled his workers' compensation claim for much less than it would have been worth had his brother not made false and fraudulent statements about his injuries. The WCCA noted that the employee did not allege he was defrauded by the employer and insurer, nor did he allege the employer and insurer were aware of or a party to his brother's fraudulent conduct. As such, the WCCA denied the employee's Petition to Vacate on grounds of fraud.

The employee also argued alternatively that good cause existed for vacating the Award on Stipulation on grounds of newly discovered evidence. Specifically, he argued his brother's affidavit was newly discovered evidence. The WCCA held that the new evidence the employee alleged was self-contradictory and had no bearing on the nature or severity of his alleged injury. As such, the employee's Petition was denied.

There were no updated cases for review as of the printing of this Newsletter.

There were no updated cases for review as of the printing of this Newsletter.

In this suit alleging violation of the Truth in Lending Act and various state laws, the Court held that (1) litigation hold notices were protected by the work-product doctrine because they were communications of legal advice from corporate counsel to corporate employees regarding document preservation; (2) with regard to privilege logs, parties are not required to separately itemize each individual email quoted in an email string; and (3) a single email in an email string may be protected by attorney-client privilege. The plaintiff had received an unsolicited credit card in the mail from Target. She found this so upsetting that, rather than simply cutting the card in two and discarding it, she filed suit against Target.

The Court in this case, involving breach of contract, unjust enrichment, and alter ego claims, conducted an analysis and concluded that requested discovery was relevant and that the benefit outweighed the burden. The plaintiffs requested copies of (1) electronic data used to answer discovery; (2) information systems organizational charts; and (3) polices and records regarding electronic data, electronic back-up, electronic data retention and destruction. The Court first determined that the requests could lead to relevant evidence regarding what efforts were made to preserve electronically-stored data because the plaintiffs alleged that the defendants failed to produce relevant electronically-stored information in its initial disclosures. In determining that the burden of discovery outweighed the benefit, the court considered (1) the needs of the case; (2) the amount in controversy; (3) the parties' resources; (4) the importance of the issue at stake; and (5) the importance of the proposed discovery. The Court reasoned that the amount in controversy exceeded $728,000; that the defendant was attempting to evade its duty by using nominally separate corporate forms; that the defendant never asserted that it did not have adequate resources to comply with discovery; and that if the plaintiffs could not prove their alter ego claim, they risked obtaining an unenforceable judgment against a dissolved corporation.

The Court sustained the plaintiff's objection to producing an electronic database in this breach of contract, breach of fiduciary duty, declaratory judgment, and fraud case. Best Buy filed suit against sixteen of its landlords and the landlords' property manager concerning seventeen lease agreements, which required the defendants to procure insurance for the common areas of the leased properties. A Magistrate Judge held that Best Buy must restore an electronic database from a separate litigation to permit discovery by the defendants. Upon review of the Magistrate's decision, the District Court determined that the $124,000 cost of restoring the database, which had been downgraded to back-up tapes, made the database "not reasonably accessible." Although the defendants argued that Best Buy had a duty to preserve the database in anticipation of litigation, the Court held that the database would have been relevant in any potential litigation and that the discovery in this case did not warrant preserving the database in useable form. After performing a "good cause" analysis, the Court concluded that the defendants' arguments failed to connect general concerns about Best Buy's electronic discovery efforts with the specific discovery ordered by the Magistrate Judge. In the absence of particularized arguments, the Court stated that the defendants failed to establish the good cause required to restore the database.

In this case involving alleged violations of the Fair Debt Collection Practices Act and the Ohio Consumer Sales Practices Act, the Court granted the plaintiff's motion to compel discovery and denied the plaintiff's motion for an order to deem requests admitted. The plaintiff served Interrogatories and Requests for Admissions on the defendant in an effort to obtain class certification. The defendant claimed that the requests were unduly burdensome and would require manually searching through hundreds of thousands of records. The defendant also argued that it made a reasonable inquiry and that its electronic filing system was only searchable by consumer name. The Court found that the defendant failed to produce any evidence or description of its attempt to engage in a "reasonable inquiry" and therefore failed to carry its burden of showing it made a reasonable inquiry to obtain answers to the plaintiff's discovery request. In the interests of justice, the Court declined to deem requests for admissions on the issue of numerosity admitted because numerosity was critical to the case.

The Court, in this civil rights and state claims action, declined to impose sanctions on the defendant County of Suffolk for failing to preserve electronic documents, but ordered the defendant to pay the cost of the motion. The plaintiff requested that the Court enter a default judgment or issue an adverse inference instruction to the jury because the defendant failed to implement a litigation hold. The defendant had also failed to conduct a system-wide search for responsive emails and had failed to comply with a court order directing the defendant to supplement its discovery. The defendant alleged that it lacked resources to comply with the order. The Court ordered that the tapes be restored and searched, and Kroll On Track (an electronic discovery vendor) was used. Kroll estimated that it would take 14 days to restore the tapes and 60 days for the entire retrieval process, at a cost of $418,000 to $963,500. The Court found that the defendant had a duty to preserve evidence, that the failure to preserve all potentially relevant backup tapes was "merely negligent," and that the plaintiff could not show that the destroyed/lost emails were favorable or relevant to the motion for default judgment or an adverse inference instruction.

The District Court granted the defendant's motion to end pre-certification discovery in this case involving claims by five deaf employees of the United States Postal Service. The plaintiffs claimed that the Postmaster General's failure to provide a sign language interpreter at safety meetings and work meetings prevented them from performing their duties safely. The defendant argued that the plaintiffs had the evidence they needed for class certification. The plaintiffs argued that the defendant's discovery production was grossly insufficient and manifestly incomplete. The plaintiffs specifically argued that numerous documents produced by the defendant were labeled "non-responsive" and that certain facilities failed to provide electronic documents. The Court declined to infer from the paucity of documents that more must exist. Rather, the Court held that the documents already produced must permit a reasonable deduction that other documents may exist or did exist and have been destroyed.

In this patent infringement case, the Court granted in part Broadcom's motion for sanctions against Qualcomm. In a lengthy opinion, the Court set forth the facts by which Qualcomm and its attorneys produced 1.2 million pages of marginally relevant documents while failing to produce over 46,000 critical documents. The Court found that this was not possible without "some type of assistance or deliberate ignorance" from Qualcomm's attorneys. The Court stated that Qualcomm could not present any evidence to justify its failure to produce the 46,000 documents. Because Qualcomm had agreed to produce the documents and answered discovery (though falsely), Broadcom had not filed a motion to compel. The absence of a motion to compel limited the sanctions Broadcom could request. The Court ultimately ordered Qualcomm to pay $8,568,633.24 to Broadcom (less any amount paid under a previous order), ordered Qualcomm and its attorneys to create a detailed Case Review and Enforcement of Discovery Obligations program to prevent future discovery issues, and referred six of Qualcomm's retained attorneys to the State Bar of California.