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IN TESLA AUTOPILOT CASE, DELAY AMENDING NOT BAD FAITH DENIAL.

Delay in bringing a motion for leave to amend a complaint does not necessarily mean bad faith.  Without bad faith delaying the motion for leave to amend, there is no denial, a Magistrate Judge in the Eastern District of New York reminded practitioners in Wang v. Tesla, Inc., 20-CV-3040-NGG-SJB, 2021 WL 3160795 (E.D.N.Y. July 26, 2021) (Bulsara, USMJ).

          The plaintiffs sued Tesla in that case over an accident involving their Tesla automobile.  Specifically, they alleged that they were using the Autopilot feature on their Tesla at the time of their accident.

          They wanted to add a specific allegation that their insurance carrier assigned all its subrogation rights to them.  The amendment was allowed with this concise conclusion:  "But Plaintiffs may add one factual paragraph regarding the assignment of their insurer's subrogation rights. Plaintiffs shall file a Second Amended Complaint that complies with this Order by August 2, 2021."  Wang, 2021 WL 3160795, at *12.

          The Court in that case denied another request to amend the complaint, this one to allow the matter to proceed as a class action.  The amendment was denied, but because it would be futile in the eyes of the Magistrate Judge, and not because it was brought in bad faith.   Wang, 2021 WL 3160795, at *12.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

MEDICAID EXPANSION IN MISSOURI: EQUAL PROTECTION FROM & OF THE VOTERS.

In Doyle v. Tidball, ___ S.W.3d ___, No. SC 99185, 2021 WL 3119116 (Mo. July 22, 2012), the Missouri Supreme Court unanimously held that the effect of the plain language of the voters' State Constitutional Amendment requires equal protection if the Missouri Legislature appropriates any money for Medicaid (as it must under other requirements of law).

          The Missouri State Constitution Medicaid Expansion Amendment extends the eligibility of Medicaid in Missouri.  It does not affect the appropriation of funds, the Court ruled.

          However, the funds that have been appropriated (so far) by the Missouri Legislature are intended to be applied equally -- even if the funds appropriated are inadequate to the task.

          The Court ruled that "the plain language of the purposes stated [in the appropriations bills is] to fund MO HealthNet without distinguishing between benefits provided to individuals who are eligible as part of the pre-expansion population and those eligible only under article IV, section 36(c) [the Missouri State Constitution Medicaid Expansion Amendment]."  Doyle v. Tidball, 2021 WL 3119116, at *6.

          That's how Medicaid Expansion was upheld in Missouri:  The Missouri Supreme Court rejected any notion that the Missouri Legislature attempt to impose inequality in health care in a pandemic.

          That's the rest of the -- real -- story here.  Much has been written about the Missouri Supreme Court's decision in the popular press, but I have not seen this published anywhere else as yet.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

BARR's department 'ISN'T OVER, IT ISN'T EVEN PAST.'

MARK R. FREEMAN, Esquire has been a busy lawyer since 2014 when we started paying his salary with our federal taxes.  He joined the justice department that year.

          There are reports that in January 2020 he argued against the former guy's White House Counsel testifying under a subpoena from the U.S. House of Representatives.

          He definitely argued in January 2020 against unsealing the Mueller Grand Jury testimony and documents so that the House could see it all.

          It is unclear when he became the Director of the Appellate Section of the Civil Division at the
department of justice, but he holds that position now when MERRICK GARLAND is the Attorney General.

          In June 2021, MARK FREEMAN argued in a Reply Brief with his name on it, that the United States should be substituted for the former guy in E. Jean Carroll's lawsuit.  The doj did not have to appeal at all.  It will be remembered that Ms. Carroll sued the former guy for defamation when he called her a liar among other things after she said that the former guy raped her.

          A federal judge denied Bill Barr's motion and that's why there is an appeal.  If the motion had been granted, the United States would become the defendant and Ms. Carroll's lawsuit would be barred because you cannot sue the United States for defamation.

          FREEMAN's brief on the appeal continues to argue that the former guy was performing his official duties when he allegedly defamed Ms. Carroll.

          If the appeal is successful, then Ms. Carroll's lawsuit will be barred.  That is the reason for MARK FREEMAN's brief.  Ms. Carroll's lawsuit will be barred if it is successful.

          Despite media reports, there really is no reason to think that there is a new Attorney General in town.  The same policies are being advanced in -- and rejected in -- the Federal Courts.  See previous articles here, here, here, and here.

          There are many stories in the doj.  This has only been one of them.

This article is reprinted with permission from Claims and Issues Blog.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

   

COVID COVERAGE, MAJORITY VIEWS, PRESENTING AND DEFENDING COVERAGE CLAIMS.

The current majority view of most Covid coverage claims is concisely expressed in a recent decision in the U.S. District Court for the District of Connecticut:

    To the extent something more than the presence of COVID-19 alone can be alleged as a loss and a basis for insurance coverage, Farmington may file an Amended Complaint by August 20, 2021. If they cannot do so by this date, the dismissal of this Complaint will be with prejudice.

Farmington Vill. Dental Assoc's, LLC v. Cincinnati Ins. Co., No. 3:20-cv-01647 (VAB), 2021 WL 3036902, at *1 (D. Conn. July 19, 2021) (emphasis in original).

          This is a typical case of Covid insurance coverage claims by businesses since the pandemic began.  Farmington Village Dental Associates presented its claims for income losses under fairly standard policy provisions in this case:

    This dispute stems from the parties’ interpretations of the “Business Income, Extra Expense, Civil Authority, Ingress and Egress and Sue and Labor provisions” of the Policy.

Farmington, 2021 WL 3036902, at *2.  Farmington presented many arguments in favor of coverage for its losses, including arguments that are presented across the nation in other, similar cases.  The federal court in Connecticut, however, looked to Connecticut law as the deciding factor and denied Farmington's coverage claims accordingly:

    Under Connecticut law, however, losses due to a property's inoperability without any physical loss or damage to the property itself are not recoverable with this type of property insurance coverage. 

Farmington, 2021 WL 3036902, at *10.  This holding defeated all of Farmington's coverage arguments in the eyes of the federal judge who decided this case, which would include Farmington's arguments that the policy provisions were ambiguous and that they should in this case be defeated by the doctrine of an insured's reasonable expectations.

          The approach taken by the court in this case may actually be hopeful.  It may signal that courts, some of them, are no longer deciding Covid coverage questions by invoking so-called majority views to decide Covid coverage issues.  To the extent that courts turn to established rules of State insurance coverage law, as in this case, then there may be room for different results in different cases with different facts in different jurisdictions.  There is a saying that "one size does not fit all."

          After this decision, it is perhaps a little clearer that the "majority view on Covid coverage" does not fit all.

See forthcoming § 7:20, "Virus Exclusions and the Coronavirus Pandemic of Covid-- 19," in CATASTROPHE CLAIMS:  INSURANCE COVERAGE FOR NATURAL AND MAN-MADE DISASTERS (coming in Fall 2021), and the forthcoming article on Remedies in TORTS, TRIAL AND INSURANCE PRACTICE JOURNAL Survey Edition (American Bar Association 2021).

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

WHERE BREACH OF CONTRACT MEETS IMPLIED COVENANT OF GOOD FAITH.

In Colwell v. MCNA Ins. Co., 960 N.W.2d 675 (Iowa 2021) (emphasis in original), the unlabeled synopsis at the outset of the published decision, printed even above the identification of the Justice who wrote the opinion for the Court, states:

The defendants appeal the district court's ruling in favor of the plaintiff finding breach of contract and breach of implied covenant of good faith and fair dealing. AFFIRMED.

         The Iowa Supreme Court's opinion refers only to the breach of contract conduct, so far as I can find from reading the opinion.  When the Supreme Court unanimously affirmed the trial court's bench-trial judgment for the plaintiff on the plaintiff's breach of contract claim, necessarily they also unanimously affirmed the trial court's judgment for the plaintiff on the plaintiff's claim for breach of the implied covenant of good faith and fair dealing.

          Judgment was entered by the trial court on both claims, it appears.  Therefore, an appeal from that judgment was an appeal from judgment for the plaintiff on both claims, and so the Supreme Court's affirmance of the trial court's judgment was an affirmance of judgment for the plaintiff on both claims.

          Apparently in some cases at least, breach of the implied covenant and breach of contract can result in a judgment on both claims, such that appealing the judgment decides the appellate fate of not one but both of the claims.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

BOTH THE SUBSTANCE AND THE PROCEDURE OF THE THING.

In Obertman v. Electrolux Home Care Prod's, Inc., No. 2:19-cv-02487-KJM-AC, 2021 WL 2823072 (E.D. Cal. July 7, 2021), the Court outlined both the substance and the procedure of sealing court records from public view.

            The Court concisely summarized the current law undergirding the strong, constitutional presumption of public access to court records at the beginning of its opinion.  First, the Court repeated the basic point that only judges, and not the parties or their lawyers, decide what the public can and cannot see in the records of courts.  Obertman, 2021 WL 2823072, at *1.

            Then the Court listed the substantive reasons that are currently recognized as justification for denying the public access to court records despite the default presumption that access is ordinarily required:

• Protect against promoting either private spite or public scandal;
• Protect courts from being repositories of libel; and
• Protect “'sources of business information that might harm a litigant’s competitive standing.'”

Obertman, 2021 WL 2823072, at *1.

            After repeating the substance of the presumption of public access and outlining the exceptions to that default presumption, the Court addressed the procedures widely employed for parties and their lawyers to request an exception and deny public access to court records.

            In this case, the Court summarized the procedures extant in the Ninth Circuit in which this Court sits:

• First, the judge must put the underlying motion or other document or record, into a frame whereby the judge determines whether or not the record is “'more than tangentially related to the merits of a case.'”
• If for example a motion is involved, and if the underlying motion is not tangential, then the inquiry stops because the presumption does not apply. The judge's analysis continues, however, if she finds that the underlying motion is "more than tangentially related to the merits of the case[.]"   When that determination is made, i.e., when the judge decides that the underlying motion is more than tangentially related to the merits of the case, then the party requesting to keep the record secret must provide evidence of "compelling reasons" for the secrecy.
• "Applying this standard, 'a court may seal records only when it finds 'a compelling reason and articulate[s] the factual basis for its ruling, without relying on hypothesis or conjecture,' and finds this reason outweighs the public’s interest and the presumption of public access."
• The requirement of a "compelling reasons" showing is not satisfied simply by citing to an earlier stipulated protective order, or by citing to any other previously entered "generalized protective order, including a discovery phase protective order." The requirement is satisfied instead by a showing related to the specific document or other court records as to which the party seeks to have the judge order the secrecy.

Obertman, 2021 WL 2823072, at *1.

            In the Obertman case, the request to seal judicial records concerned the plaintiff's motion to certify a class.  This motion was obviously more than tangentially related to the substance of the claim and so the "compelling reasons" requirement applied.

            The party requesting secrecy showed only that the parties in the case had all previously stipulated to a protective order.  This was hardly enough to overcome the presumption of public access to particular court records in that case.

            Among other things, the lawyers do not control the outcome of the secrecy question, the court controls that outcome.  Further, a mere stipulated protective order does not satisfy the required showing of compelling reasons to deny the public access to a specific court record.  Obertman, 2021 WL 2823072, at *2.

            Substance and procedure stated, and applied.  The Obertman decision does all of that in denying a request to bar public access to specific court records.  The presumption of public access to court records prevailed on this record.  The party seeking secrecy did not satisfy the prevailing requirement at this time, but it could try again.  "Accordingly, the request is denied, but with the possibility of renewal."  Obertman, 2021 WL 2823072, at *2 (emphasis by the Court).

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

WISCONSIN NEXT: BUCKING THE TRENDS, OR DOES IT?

This follows an article featuring North Carolina law published here on Wednesday, July 7, 2021, NORTH CAROLINA BUCKS THE TRENDS, OR DOES IT?

"In Wisconsin, bad faith is a tort 'separate and apart from a breach of contract.'"  Greystone Condo. at Blackhawk Owners Ass'n v. Amguard Ins. Co., No. 19-cv-768-slc, 2021 WL 168971, at *5 (W.D. Wis. Jan. 19, 2021) (Crocker, USMJ).

    Insurance bad faith under Wisconsin law is a separate wrong from a breach of contract.  It is an intentional tort, which is founded on a breach of duty rather than simply a breach of contract.  The duty is that of good faith and fair dealing because of the relationship that exists between insurance carrier and policyholder, between insurer and insured, under their insurance contract.  "[A]s such, separate damages may be recovered for bad faith and for breach of contract."  Greystone Condominium, 2021 WL 168971, at *5.

    Not being dependent on a breach of contract, bad faith is actionable under Wisconsin law regardless of whether the carrier has breached the insurance contract, or not.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

 

ASK FOR RIGHT RELIEF, YOU MIGHT GET RIGHT ANSWER.

This article was previously published under the title, JUDGES WILL OFTEN TELL THEM TO STOP,  SO ASK!, on Claims and Issues Blog on Tuesday, July 6, 2021.  Reprinted here with permission.

(Gridview_imagefull/Florida Department of Agriculture and Consumer Services)

Recently some courts have ruled against equal laws.  It seems to me that these rulings depend more on the fact that the people who sued (to get taxpayer money paid to them instead of that money being paid to other people) asked the judges to tell the defendants to stop, instead of asking for damages.  I have said this before.

             In these cases, judges have issued TROs or Temporary Restraining Orders and Preliminary Injunctions stopping the Secretary of Agriculture from applying ARPA or American Recovery Plan Act eligibility requirements that gave preference to Black farmers over White farmers, at least at first, in Faust v. Vilsack, ___ F. Supp. 3d ___, No. 21-C-548, 2021 WL 2409729, at *5 (E.D. Wis. June 10, 2021), or stopping the Small Business Administration from considering applications for federal monies for 21 days from a restaurant revitilization fund provided under ARPA unless during those 21 days the applications were processed without regard to whether the applicants were White males, in Greer's Ranch Cafe v. Guzman, ___ F. Supp. 3d ___, No. 4:21-cv-00651-O, 2021 WL 2092995 (N.D. Tex. May 18, 2021). 

            More judges are ruling like this and so I say it again:  These rulings depend less on the lawyers involved in them and more on the fact that the plaintiffs in these cases, meaning the people who filed the lawsuits, asked the judges to tell the defendants to stop instead of asking for damages.

            A federal judge in Florida told the State to stop when the judge issued a preliminary injunction stopping the State from imposing fines and limits on people who petition to put proposed State constitutional amendments on the ballot.

            This ruling came right after another federal judge in Florida stopped the State from imposing penalties under a new Florida law that would require social media companies to let politicians say whatever they want to say on their websites.  The new Florida law would have allowed Florida to impose penalties up to a Quarter of a Million Dollars.  A day.

            Courts in Maryland are telling the State to stop withholding unemployment benefits from unemployed people during a pandemic.  These lawsuits have been heard at all three levels of courts in Maryland, from the trial court to the intermediate appellate court to the State's highest Court.

            Comfortable people did not file these lawsuits.  The people who filed them include individuals, and they include groups that did not exist before such as "the Unemployed Workers Union" and "the Baltimore-based Peoples Power Assembly."  Significantly, the plaintiffs apparently did not include political parties or established civil rights organizations or other entrenched interests.  These lawsuits were brought by people in Maryland who are affected by the Maryland Governor's  attempted order to force them to take jobs, any jobs.

            The Maryland trial judge was the first judge in these Maryland cases to hold that the State must stop what they were trying to do.  The trial judge issued a "temporary restraining order," effectively another name for a preliminary injunction.  One of the trial judge's reasons is instructive.  It should be followed in other States where governors are trying to block unemployment benefits and so force unemployed workers to take any job that the governors' campaign contributors condescend to give them.

            The Maryland trial judge ruled in part because the State governor "appeared to lack the authority to end the federal program early.  He added that the plaintiffs' stories of economic hardship reminded him that 'the impact of the pandemic has been cruelly uneven.'"  Katherine Shaver, Court Rejects Hogan Request to Block Order Preventing End of Enhanced Federal Unemployment Benefits, WASHINGTON POST, online Monday, July 5, 2021 (emphasis added).

            State governors may lack the authority to end the federal program early.

            Ending the federal program early may violate equal protection of the laws.

            These concepts are not limited to the pen of a trial judge in Maryland.  They apply in every State.  State Constitutions are based on them.  The Federal Constitution guarantees equal protection of the laws in all the States.

            Judges will tell them to stop.  So ask judges to tell them to stop.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

NORTH CAROLINA BUCKS THE TRENDS, OR DOES IT?

Under North Carolina law, "a bad faith claim may proceed even where it is determined that the underlying contract was not breached."  Duke Univ. v. Endurance Risk Sol's Assur. Co., No. 5:20-CV-672-BO, 2021 WL 2345014, at *4 (E.D.N.C. June 8, 2021).

          Under the North Carolina Unfair Trade Practices Act, a "mere breach of contract" does not state a claim, but if "a breach of contract claim is 'surrounded by substantial aggravating circumstances,'" there might be an unfair and deceptive trade practice claim under the North Carolina statute.  Duke University v. Endurance Risk Solutions Assurance Co., 2021 WL 2345014, at *4.

          The federal court denied the insurance carrier's motion to dismiss a bad faith claim and a UTPA claim in this case accordingly.

          In this ruling, North Carolina law is bucking the apparent trend to anchor bad faith claims to coverage.  But -- buttressed by this ruling (pun intended) -- why would bad faith be anchored to coverage if, for example, the complaint is divorced from coverage considerations, such as when the parties instead dispute the carrier's conduct in failing to settle a covered claim?

          This case apparently concerned something different from settling an underlying liability claim.  This case apparently concerned instead an insured's claim to be reimbursed for covered defense expenses.  But even in this case, the insured's complaint stated a claim for bad faith.  How much stronger should the case be for stating a claim for bad faith divorced from a coverage claim, in a case where there is no coverage dispute but there is a dispute about failure to settle covered claims?

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

HAPPY FOURTH OF JULY observed! PHYSICAL LOSS, PHYSICAL DAMAGE unseen.

"This appeal presents only the question of whether the COVID-19 pandemic and the related government-imposed restrictions constitute direct 'accidental physical loss or accidental physical damage' under the policy."  So said the appellate panel in Oral Surgeons, P.C. v. Cincinnati Ins. Co., ___ F.4th ___, No. 20-3211, 2021 WL 2753874, at *3 n.2 (8th Cir. July 2, 2021) (case involved Iowa substantive law).

          Oral Surgeons made a claim for insurance coverage after it "suspended non-emergency procedures due to the COVID-19 pandemic and the related government-imposed restrictions" thus causing Oral Surgeons to lose business income and incur extra expense.  "Oral Surgeons did not allege any physical alteration of property."  Oral Surgeons, 2021 WL 2753874, at *3.

          The trial judge ruled that the policy required direct, accidental physical loss to or accidental physical damage.  Since in the eyes of the trial judge, Oral Surgeons did not allege any physical loss or physical damage, the trial judge granted the insurance carrier's motion to dismiss.  The appellate panel affirmed.  Oral Surgeons, 2021 WL 2753874, at *3.

          It is well worth noting that the only insurer conduct at issue in the Oral Surgeons cases was the insurer's denial of coverage.  In other cases in which an insurer's denial of coverage for COVID was the only carrier conduct at issue, it has been held that there cannot be a viable claim for bad faith, either.  See, e.g., 10E, LLC v. Travelers Indem. Co., 483 F. Supp. 3d 828, 837 (C.D. Cal. 2020).

          Hot off the press for a Hot July Day!

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

HAPPY FOURTH OF JULY!

AT DEPARTMENT OF JUSTICE, EVERYTHING IS CHANGING, NOTHING IS NEW.

This article was first published on Claims and Issues Blog on Thursday, July 1, 2021.  Reprinted here with permission.

Download Brief of the United States in Trump v. Carroll 2d Cir Appeal Case No. 20.3977 filed June 7 2021

Brief of the United States of America in the case of E. Jean Carroll, Case No. 20-3977, Doc. 102, filed June 7, 2021.

One lesson of the last four+ years is clear:  People matter.  The people that make the decisions in our government matter.   Who the prosecutors are, matters.

            Whether we have a Department of Justice or a department of career young attorneys intent on CYA, depends on who is in the department.

            It also very much depends on who really runs the department.

            "Structural checks can be overrated.  The survival of our Republic depends as much, if not more, on the virtue of those in government, particularly the upholding of norms by civil servants, prosecutors and military officials.  We have grown too jaded about things like professionalism and institutions, and the idea of men and women who take their duties seriously.  But as every major moral tradition teaches, no external constraint can fully substitute for the personal compulsion to do what is right."  Tim Wu, What Really Saved the Republic From Trump?, NEW YORK TIMES, online Dec. 10, 2020.

             The personal compulsion to do what is right, the virtue of those in government, particularly the upholding of norms by civil servants:  Were these the characteristics on display of the people that we are looking at in the department of justice?

            Were these characteristics on display from them during the last four+ years?

            Are they on display now?

            Let's look for these characteristics, starting with the individuals featured in the first article in this series, IN MERRICK GARLAND'S DEPARTMENT, PROTECTING 'CAREER YOUNG ATTORNEYS' MEANS "CYA."

            JOSHUA M. SALZMAN.  This is the person who submitted the reply brief to continue Barr's appeal attempting to substitute the United States for the former guy in the lawsuit E. Jean Carroll filed.  She filed a defamation lawsuit after the F.G. allegedly defamed her by calling her a liar after she alleged he raped her.  The United States Department of Justice argued in SALZMAN's reply brief that the defamation was a part of the former guy's official duties.

            During the time of the F.G. and A.G. Barr, JOSHUA SALZMAN worked at Barr's law firm, the department of justice.  He did not always work there; MR. SALZMAN, like some of the others, used to be employed at MERRICK GARLAND'S law firm, WilmerHale. 

            During the time of the F.G. and A.G. Barr, MARK STERN also worked at Barr's law firm.  MARK B. STERN's name is also on the reply brief that MR. SALZMAN filed, appealing for the substitution of the United States in the F.G.'s role as defendant in E. Jean Carroll's lawsuit.

            If their appeal is successful, the United States will become the defendant in that lawsuit; the United States cannot be sued in that lawsuit.  If their appeal is successful, then, it will gut E. Jean Carroll's lawsuit against the former guy. 

            A third lawyer who takes credit for the reply brief in E. Jean Carroll's case is MARK R. FREEMAN.  He is the current Director of the Appellate Staff, Civil Division, in the justice department.  He, too, worked in A.G. Barr's department during the time of the F.G.  He, too, worked in MERRICK GARLAND's law firm before that.

            As we shall see in this series, among other things, MR. FREEMAN reportedly was instrumental in arguing that the F.G.'s General Counsel, Don McGahn, should not testify under subpoena from the U.S. House of Representatives.

            Last but not least, there is Acting Attorney General and MERRICK GARLAND's deputy, BRIAN M. BOYNTON.  He alone among the crew did not also work for the former guy or for A.G. Barr during the time that the F.G. was in office.  His background is in defending large corporations and other things and people -- including one Betsy DeVos, the F.G.'s Secretary of Education, as we shall also see in this series.

            MERRICK GARLAND is responsible for the decisions of these people.  Beyond and to the exclusion of every reasonable doubt, as they say, these are MERRICK GARLAND's decisions.

            There is no better way to conclude this article than by once again quoting from Professor Tim Wu's piece in The New York Times:

          It may sound naïve in our untrusting age to hope that people will care about ethics and professional duties. But Madison, too, saw the need for this trust. “There is a degree of depravity in mankind,” he wrote, but also “qualities in human nature which justify a certain portion of esteem and confidence.” A working republican government, he argued, “presupposes the existence of these qualities in a higher degree than any other form.”

           It is called civic virtue, and at the end of the day, there is no real alternative.

Please read the disclaimer.  This blog article ©2021 Dennis J. Wall.  All rights reserved.

BAD FAITH IN THE JUSTICE DEPARTMENT?

This article was originally published with the title, IN MERRICK GARLAND'S DEPARTMENT, PROTECTING 'CAREER YOUNG ATTORNEYS' MEANS "CYA," on Claims and Issues Blog, on Tuesday, June 29, 2021.

Part One, the first part.

Merrick Garland has been portrayed by the incoming administration as something he is not.  Demonstrably not.  To paraphrase the Acts of the Apostles, "you shall know them by their actions." 

          Not by what they say, or what others say about them.

          This is the first in a series.  In it, we will take a look together at the actual things being done by the current department of justice.  In the end, it is a puzzle why they continue to try to protect the things that were done by the previous regime.

    

 

   (Alexander Drago / Reuters)

           Our first example is the decision to continue the appeal to substitute the United States in the place of the former guy sued for defamation by E. Jean Carroll.  The former guy's regime, Bill Barr acting as Attorney General then, tried to substitute the United States for the F.G.  Federal Judge Lewis Kaplan thought about it, before he wrote a 61-page decision listing many, many reasons for denying the motion to substitute the United States to defend Ms. Carroll's defamation action.  It should not be forgotten that Ms. Carroll filed her defamation lawsuit in response to the F.G.'s vehement denial that he raped her.  (The F.G.'s vehemence included the charge that Ms. Carroll was lying, thus she filed the defamation lawsuit.)

           The F.G.'s Attorney General, Mr. Barr, filed an appeal from that ruling.  Then the F.G. and the A.G. left (kind of).  In came President Joe Biden and Merrick Garland to take their places.

 

 
   (Reuters)

           Merrick Garland decided to continue the appeal to substitute the United States for the former guy at taxpayer expense.  It is eye-opening to look at the lawyers who signed the reply brief attempting to substitute the U.S. for the F.G.  This is especially revealing after Mr. Garland's statements that he wants to protect 'career young attorneys' from thinking that what they did when they worked for Barr carries any consequences now.  Surely they must be protected, Mr. Garland said he believes.  Well, let's look at who is being protected now that we have looked at who is doing the protecting.

          The decision to continue the Barr justice department's appeal was taken by:

• BRIAN M. BOYNTON, Acting Assistant Attorney General;
• MARK R. FREEMAN;
• MARK B. STERN, and
• JOSHUA M. SALZMAN.

Three of these lawyers were at the Barr department of justice, following orders.

Three of these lawyers have worked at a law firm called WilmerHale.  So did MERRICK GARLAND. 

Three of these lawyers went to Harvard Law.  So did MERRICK GARLAND.

The three lawyers who went to Harvard Law all agreed to substitute the United States, at taxpayer expense, for the former guy in E. Jean Carroll's defamation lawsuit.  You might have expected something different from their conduct, considering that they each and all went to Harvard Law where they presumably took an Ethics course or two, but you would be wrong if you expected them to behave any differently than they actually did.

Parenthetically, Harvard Law comes up again here.  Judge Lewis Kaplan, who rejected the former guy's/Barr's motion to substitute, also went to Harvard Law.

           So here's the point.  It's not that WilmerHale or Harvard Law are either of them bad, per se.  The point instead is that neither Merrick Garland nor these lawyers are what they are portrayed to be.  "I was only following orders" was a defense that was rejected at Nuremberg circa 1945.  These men -- and they are all of them men, aren't they -- certainly do not need that defense for their actions.  It is equally certain that CYA is also a bad policy for the United States Department of Justice now.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

MORE ON BAD FAITH LAW REACHING OUT: EXCUSING REMOVAL DELAYS?

The law of bad faith reaches out to many areas of life and law.  See the article on other areas touched by bad faith law posted here on Monday, June 28, 2021.

              In CMR Constr. & Roofing, LLC v. Hartford Ins. Co. of Midw., No: 2:20-cv-695-JLB-NPM, 2021 WL 2632374 (M.D. Fla. June 25, 2021), a federal judge in Florida confronted another area where bad faith comes into play.  Hartford untimely removed a case from Florida State Court to U.S. District Court.  Hartford contended that the untimeliness of its removal should be excused because of the plaintiff's bad-faith conduct.  Accepting that argument in any case will make untimely removal an exception to the statute of limitations and so, in effect, make removal timely.

            Specifically in this case, Hartford contended that the plaintiff's delay in responding to certain discovery was in bad faith.  It was not until Hartford got the plaintiff's discovery responses, Hartford said, that it became clear to Hartford that there was a ground for removal.

            The District Judge disagreed on the evidence.  While the plaintiff's conduct was not commendable, the federal judge did not find that it sunk to the level of bad faith.  The Court accordingly granted the plaintiff's motion to remand the plaintiff's case to Florida State Court.  CMR, 2021 WL 2632374, at *3-*4.

Removal and remand cases are discussed in the context of insurance bad faith claims in third-party cases in 1 DENNIS J. WALL, LITIGATION AND PREVENTION OF INSURER BAD FAITH § 5:57 (3d ed. West Publishing Co., 2021 Supps.) & in first-party cases in 2 ID. § 11:23.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

THE LONG ARM OF BAD FAITH LAW.

In a Per Curiam Memorandum decision, a panel of Florida's Third District Court of Appeal spoke volumes by saying little.

    In Strems Law Firm, P.A. v. Citizens Prop. Ins. Corp., Nos. 3D20-919 & 3D20-920, 2021 WL 2559098 (Fla. 3d DCA June 23, 2021) (stated "NOT FINAL"), the panel PCA or "Per Curiam Affirmed" opinion cited to cases that tell a tale of the long reach of bad faith law.

    The panel opinion cited three Florida Supreme Court cases approvingly and gave a parenthetical for each one.  In particular, for one Supreme Court decision the Third District panel observed that “[A] trial court possesses the inherent authority to impose attorneys’ fees against an attorney for bad faith conduct.”  2021 WL 2559098, at *1 (emphasis added).

    The other Florida Supreme Court decisions cited in the PCA opinion involved Fla. R. Civ. P. 1.540, which concerns relief from judgments, and the inherent discretion of trial judges to dismiss actions and default parties for failure to comply with "discovery requirements."  2021 WL 2559098, at *1.

    It is worth remarking that of the three Supreme Court decisions cited in this opinion, the Supreme Court spoke of bad faith in two of them and that not one of the cited cases involved insurance.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

IMPLIED GOOD-FAITH DUTY, BUT STATUTORY ALLEGED, DISCOVERY NOT ALLOWED.

A U.S. Magistrate Judge in Colorado was not impressed enough with an alleged breach of good-faith duties to allow discovery into the supervision and incentives for the adjusters involved in investigating the claim.

          In American Ins. Co. v. Pine Terrace Homeowners Ass'n, No. 20-cv-00654-DDD-KMT, 2021 WL  2188707 (D. Colo.  2021) (Tafoya, USMJ) the Court first held that every insurance contract in Colorado has an implied duty of good faith.  Pine Terrace, 2021 WL 2188707, at *2 .  This may be dicta, however.

          The defendant homeowner's association alleged two counterclaims:  Breach of Contract and Statutory Bad Faith.  The homeowner's association in this case did not allege common law bad faith.

          The standard for statutory bad faith in Colorado precluded the discovery requested.  The Court ruled that where the standard for measuring extracontractual liability for statutory bad faith, as in Colorado, is whether the carrier's conduct is "reasonable" and not "why" did they  breach their good-faith duty, discovery was not allowed into the supervision and incentives given to the adjusters who handled the claim at bar.  See Pine Terrace, 2021 WL 2188707, at *3-*4 .

          The implied duty of good faith and fair dealing is recognized in virtually every court that has considered the question, including but not limited in most cases to insurance contracts.  See 1 DENNIS J. WALL, LITIGATION AND PREVENTION OF INSURER BAD FAITH § 1.01 (West Publishing Co. 3d ed. & 2021 Supplements).

          The question of discovery into alleged bad-faith claims handling is the subject of two Chapters in 1 id., Ch. 8, titled "Discovery From Insurers Concerning Their Handling of Third-Party Claims" addressing discovery from, by, and between insurance carriers in third-party bad faith cases, & 2 id., Ch. 12, titled "Discovery From and By Insurers," discussing the same issues addressed by the courts in first-party insurance bad faith cases.

Please see the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

WORK PRODUCT IMMUNITY IN FIRST-PARTY BAD FAITH (ARSON) CASES.

    "There are two divergent bodies of case law governing the application of the work product doctrine to documents prepared by insurers in investigating claims of fire loss thought to be caused by arson. One line of cases holds that litigation becomes reasonably anticipated—and, thus, documents are covered by the work product doctrine—when the insurer has an indication that the loss was caused by the insured committing arson.  [Citations omitted.]  The other line of case law creates a presumption that documents prepared prior to an insurer issuing a formal notice of intent to deny coverage are not covered by the work product doctrine, while documents prepared after such notice are covered by the work product doctrine.  [Citations omitted.]  Though the facts of each case vary, both lines of case law tend to establish that the work product doctrine kicks in when 'the probability of litigating the claim is substantial and imminent.'”  So said a Federal Judge in the Southern District of West Virginia in the case of Javins v. Westfield Ins. Co.,  No. 2:20-cv-00698, 2021 WL 2188751, at *3 (S.D. W. Va. May 28, 2021).

    It has not been said better very often, so I quote this passage here in its entirety.  When it's good, leave it alone to be good, whatever "it" may be.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

IT'S NOT THE LAWYERS SO MUCH AS RELIEF THEY REQUEST.

I was wondering how the plaintiffs got rulings so promptly in two cases recently, one in the Sixth Circuit Court of Appeals and the other in the Northern District of Texas.  In both cases, the plaintiffs were challenging federal laws that benefitted other groups of people to which they did not belong; the plaintiffs wanted federal money to go to them.

          They got quick rulings on their requests.  I was wondering about that, as I say.  I do not think it was necessarily because they had better lawyers, as much as it was about the kind of relief they requested.

          The plaintiffs requested preliminary injunctions.  Requesting that kind of relief ordinarily galvanizes a judge into action.  This is in contrast to, say, trying to get a court to enforce a Congressional subpoena, which as we have seen can take years, and it is in contrast to attempting to have a judge apply either of the emoluments clauses of the United States Constitution, which as we have seen may never happen at all.

          These two cases are not the end of plaintiffs challenging federal laws and policies in Courts; they are the beginning.  If the current administration including the current justice department is going to stop losing, they are going to have to be strategic.

          First, they must consider going on the offensive and file suit, whenever the opportunity arises, to enforce the laws instead of waiting for laws to be challenged.

          They should also consider the relief they request, and how long it will take to achieve their purpose in filing suit.  Let the plaintiffs in these cases be guides if not mentors, exactly; is there an opening to file suits to request preliminary injunctive relief?

          Say requesting a preliminary injunction to stop a fraudit from using actual ballots cast in federal elections, which as I understand it is against the law during this short timeframe since the November 2020 election?

          If someone wants to be more successful in litigation, be more strategic.  Your probable adversaries will be more strategic in filing lawsuits.  To that end, expect more lawsuits to be filed in the Northern District of Texas.  Be ready, by filing first in a forum which you, not they, select.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

WITHHOLDING EQUALITY WHILE DEFENDING MAJORITY RULE. OF ECONOMICS, THAT IS.

The American Rescue Plan Act provides a limited amount of money for restaurants to recover from losses they suffered from COVID-19.  The money that the Act provides to get restaurants back on their feet has been called a restaurant revitalization fund.

          Yes, I know, the 'company line' is that the American Rescue Plan Act involves a lot of money, and it does.  In the case of aid to recovering restaurants, however, the funds provided  in the Act are limited and, some say, too small to meet the needs.

          In May, five federal judges considered complaints from a couple of businesses that claimed they were discriminated against.  They claimed that they suffered from discrimination under the American Rescue Plan Act because the Small Business Administration (SBA) paid out the available revitalization funds first to so-called "priority" restaurants whereas they themselves were "non-priority" for the money that the Act makes available.

          "Priority" restaurants under the Act are owned by women, by veterans, or by "socially and economically disadvantaged" people.  The plaintiffs claimed that they were discriminated against because they are not women and not socially or economically disadvantaged, i.e., because they are White males who are socially or economically advantaged, in other words.  It is unclear, frankly, whether any of the plaintiffs are or have ever been veterans.

          The problem at the center of both of their two cases was the same:  Under the American Rescue Plan Act, the restaurant revitalization funds were supposed to be released for the first 21 days only to restaurants owned by women, by veterans, or by people who are socially or economically disadvantaged.  After that, the Act provided that all the applicants could receive the money whether they were prioritized for the first 21 days or not.  This was the problem at the center of the plaintiffs' arguments in both cases to all five judges:  The plaintiffs were afraid that they would not get money.

          Whatever you may end up thinking about the merits of these decisions, one way or the other, remember what the cases were about:  The plaintiffs were afraid that they would not get their money.  All the idealistic-sounding pronouncements that will certainly come from the winning parties cannot obscure that central fact:  They sued because they wanted to get their money.

          That shouldn't obscure how close a thing it was, either.  The same people who want to pose as nothing but idealists did not win by much at all.  Five federal judges considered these complaints.  Three liked the complaints, and thought that they were good.  Two did not.

          Three to two.  That's how the judges lined up their votes on the matter in two separate cases.

          What's more, you will almost certainly hear that these decisions should be seen as a triumph for even-handed justice.  Except it seems that the thing was not handled very evenly in either case.  In both of these cases, the opinion blocking the SBA from carrying out the restaurant revitalization fund written in the Act, was in turn written by a person who was either on or, in at least one case, led a central committee for the political party that opposed the American Rescue Plan Act in the first place. 

          It is also important to put the rulings in their proper context to know more about at least one of the judges.  The judge in the Texas case is named Reed O'Connor.  You may remember his name from his opinion that has received heavy criticism for its logic, or absence of it some say, in ruling that the Affordable Care Act is unconstitutional because it imposes no penalties.

          In addition, it is worth noting that the plaintiffs in both cases challenging the SBA are represented by, among others, an interesting cast of characters.  The plaintiff in one case is from Tennessee and is represented in part by an organization from Wisconsin which exists for the purpose of pushing litigation against the interests of people like women and in general against people who are socially or economically disadvantaged -- the very people involved here.

          In the other lawsuit, the one filed in Texas, the plaintiffs are represented by among others, America First Legal Foundation.  The founders of the foundation in this case are one Stephen Miller and several other departed -- or so we thought -- former officials of the prior regime.

          In short, maintaining power by claiming the idealism of disinterested equality in an overwhelming victory, that's how the story will be sold.  How in character for these men (and they are all men, did you notice?).

          Now you and I both know the real story of these two lawsuits.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

STOPPING LOW-INCOME ACCESS TO BROADBAND: THIS CANNOT WAIT.

In New York St. Telecomm's Ass'n v. James, No. 2:21-cv-2389 (DRH) (AKT), 2021 WL 2401338 (E.D.N.Y. June 11, 2021), a Senior District Judge brought minorities' broadband access to an abrupt halt.  He ruled before the merits and entered a preliminary injunction blocking enforcement of a New York State law.

          The New York Affordable Broadband Act would have required the plaintiffs on "June 15, 2021 to offer qualifying low-income costumers [sic] high-speed broadband service at or below certain price ceilings."  Telecomm's Ass'ns, 2021 WL 2401338, at *1.  The Judge's preliminary injunction on June 11, 2021 came just in time for the plaintiffs.

          The plaintiffs could not tolerate offering qualifying low-income customers high-speed broadband service at or below certain price ceilings.  Even during a plague.  Perhaps especially during the COVID plague.

          The plaintiffs are "a group of trade associations whose members provide broadband internet service to New Yorkers[.]"  Telecomm's Ass'ns, 2021 WL 2401338, at *1. 

          The Court ruled that the New York State law is preempted by federal law which regulates the rates the plaintiffs charge.  This is the filed rate doctrine in new clothes.  This ruling means that, having regulated the rates of broadband internet service, only the federal government can act to require that any low-income customers be offered broadband service at any other rate.

          From the perspective of the telecommunications industry, this preliminary injunction could not wait.  From the perspective of this author, this article could not wait and that is why it is posted on an unusual day for publication on this blog, a Tuesday.  Reasonable accommodations are often a requirement of living.

          And of the law. 

The filed rate doctrine is discussed in 2 DENNIS J. WALL, LITIGATION AND PREVENTION OF INSURER BAD FAITH § 11:26 (3d ed. West Publishing Co., 2021 Supps.).

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

WHO, EXACTLY, DOES JUSTICE REPRESENT? PART TWO

A POSTSCRIPT:  The rest of the story.  Part of the rest, anyway.

Rights and Responsibilities.  (Florida Dep't of Agriculture & Consumer Services /  Gridview_imagefull)

The Federal Judge presiding over the Sweet v. DeVos case in the Northern District of California has held that Ms. DeVos has to sit for a deposition. 

          The Judge based his ruling at least in part on the bad faith of the government in disrupting the processing of claims to student debt relief:    "U.S. District Judge William Alsup found evidence of bad faith in the agency’s stated reasons for an 18-month halt in processing debt relief claims [which], among other factors, creates an extraordinary circumstance that warrants making DeVos sit down for a three-hour deposition."  Nicholas Iovino, Betsy DeVos Ordered to Testify in Student Borrower Class Action, COURTHOUSE NEWS, online May 20, 2021.

          Updating my article that posted this morning, "[o]n February 8, 2021 -- 19 days after the Inauguration of President Joe Biden -- Brian M. Boynton filed a motion to quash a subpoena for the deposition of Betsy DeVos."  Mr. Boynton is a new hire helping to run the Biden Justice Department under Merrick Garland.

          And, to say again, Mr. Boynton filed a motion to quash the deposition of the former regime's Betsy DeVos.

          He lost.  The motion was denied.  Absent Mr. Boynton's anticipated appeal on behalf of Ms. DeVos, she will have to sit for her deposition, under oath.  So far, Justice has prevailed in this case, but the department of justice has not.

Thanks to Margaret O'Grady, Esquire at Harvard who is a counsel of record in the Sweet v. DeVos case, and to Ms. Katie Ward of CTPBoston, for the linked Courthouse News Service reporting.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

WHO, EXACTLY, DOES JUSTICE REPRESENT?

Rights and Responsibilities.  (Florida Dep't of Agriculture & Consumer Services /  Gridview_imagefull)

On February 8, 2021 -- 19 days after the Inauguration of President Joe Biden -- Brian M. Boynton filed a motion to quash a subpoena for the deposition of Betsy DeVos.

           Mr. Boynton filed his motion in the Southern District of Florida, where DeVos was then "a part-time resident."  That was one of the places where, arguably, venue was proper for Boynton's motion to quash.  The case in which Betsy DeVos was subpoenaed for deposition is pending in the Northern District of California.

           Parenthetically, I cannot find an order granting or denying the motion, and I cannot find any evidence that Ms. DeVos has  been deposed.  I have today emailed the lead attorney who requested this deposition, Margaret E. O'Grady, Esquire and if and when I receive her Reply, I will write about it here.

          Back to Mr. Boynton.  More recently, on June 7, 2021 Brian Boynton filed a reply brief for the United States to intervene for the former guy in his appeal from an order allowing E. Jean Carroll's defamation lawsuit to go forward in New York State Court.  Her defamation lawsuit had been pending in state court before the former guy's Barr removed the case to federal court.

          Mr. Boynton was reportedly hired away from a large law firm with experience in representing corporate clients, in order to assist Merrick Garland in running the Justice Department.

          The actions discussed here, and other actions known and unknown, raise urgent questions.  First:  Who, exactly, does Justice represent?

          Next, why is it in the interest of the United States not to have the testimony of Betsy DeVos under oath?

          How is it that any lawyer can argue, without consequence, that denying a rape and demeaning the victim is a part of the official duties of a President of the United States?

          I did not expect to be asking any of these questions with Merrick Garland replacing Bill Barr and Joe Biden replacing the former guy. 

          Did you?

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

COURTS WRITE LAW, OVERRIDE CONSTITUTION, FOR "SENSITIVE BUSINESS INFORMATION."

(NASA)

Courts are tending to keep documents and testimony a secret just so long as the parties claim it is "sensitive business information."  See, e.g., M3 USA Corp. v. Summer Qamoum, No. 20-2903 (RDM), 2021 WL 2324753, at *7 (D.C.D.C. June 7, 2021) ("The Court also entered a stipulated protective order, permitting the parties to safeguard their sensitive business information. Dkt. 20.").

          When entering a secrecy order, i.e., a protective order such as under Federal Rule of Civil Procedure 26(c), Courts have wide discretion.  However they do not have discretion to override the presumption of public access to Court records at will.

          Courts have to accommodate that presumption, to recognize it and to apply certain safeguards when the interests are balanced in favor of secrecy, including to limit disclosure rather than to bar disclosure entirely unless the case is so unique that no disclosure is required.  The presumption of public access to Court records is a presumption which comes from both the United States Constitution and common law (even though, in the federal system, there is not supposed to be such a thing as common law).

          Keeping "sensitive business information" confidential is really a creation of the lawyers for large corporations which want to keep such information a secret from the public.  Large corporations would face a risk of losing business otherwise.  Needless to say, "sensitive business information" is not protected from disclosure either by the Constitution or by Rules of Procedure; rather, it is protected from disclosure by a swiftly growing number of Courts and stipulations, as in this case. 

          For recent restrictions on secrecy orders, see for example the articles posted here on May 24 and on May 26, 2021.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

"A MULTITUDE OF CASES" DETERMINES COVID COVERAGE IN CASE.

In HT-Seattle Owner LLC v. Am. Guar. & Liab. Ins. Co., NO. 2:21-cv-00048-BJR, 2021 WL 2206480 (W.D. Wash. June 1, 2021), policyholders argued that coverages aside from those that had been litigated in Washington State potentially provided insurance coverage to COVID-related losses.   The District Judge handling all these cases disagreed:

These provisions, however, all require direct physical loss or damage to covered property to trigger coverage. See Compl., Ex. A, Dkt. No. 1-1 at 41 (Insurance Agreement), 47 (Property Damage), 51(Time Element), 53 (Extra Expenses), 85 (Covered Cause of Loss). Therefore, given the Court's conclusion that COVID-19 does not cause physical loss or damage, these provisions fail to provide coverage.

HT-Seattle, 2021 WL 2206480, at *1 (citations omitted).

          The Court pointed out that this case "is one amongst a multitude of cases across the United States in which a business seeks coverage for income lost due to the COVID-19 pandemic from their insurance company."  HT-Seattle, 2021 WL 2206480, at *1.  The Western District of Washington assigned all such insurance coverage cases to the District Judge who decided this case.  She, in turn, "consolidated the earliest of these actions into ten cases."  She reached the same ruling in all those cases because they all had the same policy language in their Insuring Agreements, i.e., in their coverage grants:

This Court recently published an Order in those cases holding there was no coverage for losses due to COVID-19. See Nguyen, et al. v. Travelers Cas. Ins. Co., et al., No. 20-cv-00597, 2021 WL 2184878 (W.D. Wash. May 28, 2021). The Court held that in all of the relevant policies “direct physical loss of or damage to” covered property was required to trigger coverage and COVID-19 did not cause physical loss or damage. Id. at *9–*13. Additionally, the Court held that the plaintiffs’ Extra-Contractual Claims should be dismissed along with their Contractual Claims where they failed to identify independent grounds apart from unreasonable denial of coverage. Id. at *13–*14.

HT-Seattle, 2021 WL 2206480, at *1 (footnote omitted).   

          Once again, the Court also ruled that because there was no viable coverage claim, there was no cognizable claim for insurer bad faith, either.  HT-Seattle, 2021 WL 2206480, at *2.

Cases involving the dismissal of bad faith claims in COVID coverage cases after a holding that there is no coverage for COVID-related losses, are reviewed in Volume 2 of Dennis J. Wall, Litigation and Prevention of Insurer Bad Faith § 9:14 (3d ed. Thomson Reuters West, 2021 Supplements forthcoming).  See in addition 2 id. §  9:31 (discussing basic coverage issues common to Chinese Drywall, COVID, and other property insurance cases).

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

NO DISPUTE, CASE OR CONTROVERSY? NO BLANKET PROTECTIVE ORDER, EITHER.

In an article on May 24, a seminal decision on blanket protective orders was discussed here in terms of the Court's rulings on secrecy and the presumption of public access.  The case is AgJunction LLC v. Ag Leader Tech., Inc., No. CV-20-02204-PHX-SPL, 2021 WL 1969523 (D. Ariz. March 9, 2021).

    The Court in this case also raised the possibility of an argument that Federal Courts lack the jurisdiction to enter blanket protective orders in the absence of a case or controversy.  Here's why it did.

    The lawyers of record wrote a proposed order in that case that was so comprehensive it would have rewritten the Federal Rules of Civil Procedure, in effect.  The proposed order contained provisions keeping a litany of things secret:

Here, the Proposed Protective Order defines “confidential” material as “any information, document, or thing, or portion of any document or thing that contains: (1) trade secrets; (2) confidential business information, including contracts or license agreements with a third party where disclosure would violate a contractual obligation of confidentiality; (3) personal identifying information, such as a Social Security number; or (4) personal health information protected by the Health Insurance Portability and Accountability Act, of the Party or a Non-Party to whom the Party or Non-Party reasonably believes it owes an obligation of confidentiality with respect to such documents, information, or material.” (Doc. 15-2 at 2). This does not meet Rule 26(c)’s threshold.

AgJunction, 2021 WL 1969523, at *1.

    The parties agreed to this multi-faceted definition of "confidential;" the lawyers stipulated to it and proposed it to a Federal District Judge.  Their problem, however, was not in their language but two-fold, first in their lack of good cause for protection, as was discussed in the previous article here and mentioned in the above quotation.

    Their problem continued with their lack of a dispute, the lack of a case or controversy that cried out for the protection of a Federal Court.  Nothing in that case had yet reached the point of a request for production, a deposition question, an interrogatory, or any objections.  There was, to say again, no case or controversy to activate the Federal Court's Article III jurisdiction.  There was only the lawyers' proposed protective order in case there would be a case or controversy over discovery or evidence later in the case, but there was not a case or controversy at the time of this decision.  Their attempt to manage the possibilities in the case was no substitute for the reality that there was no present, actual, tangible case or controversy:

    Further, no party has shown that there is an actual dispute that commands Court intervention and protection. See Fed. R. Civ. P. 26(c)(1); LRCiv 7.2. The parties remain free to mutually enter into a written agreement to facilitate the exchange of confidential disclosures without court approval or supervision. And, in the event discovery mandates disclosure of specific, harmful, confidential material, the parties will not be precluded from presenting a request to the Court at that time in a manner tailored to protect the particular interests at hand. [Citation omitted.]      Accordingly,

    IT IS ORDERED that the parties’ Joint Motion to Stay (Doc. 15) is granted in part and denied in part. The Motion to Stay is granted and the Motion for Protective Order is denied.

 

AgJunction, 2021 WL 1969523, at*2 (emphasis by the Court).

    The Court in this case did not use the words, but there was no case or controversy over the stipulated proposal for a protective order.  There was no basis for a Federal Court to act.  Federal Courts are prohibited from giving advisory opinions, there is no doubt about that.  Blanket protective orders in the absence of a dispute over discovery or the production of evidence are nothing short of mere advisory opinions, there ought to be no doubt now about that.

 

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

 

 

BLANKET PROTECTIVE ORDERS vs. BLANKET SECRECY CONTRACTS.

The difference to the parties may be compelling someone else to keep a secret (stipulated blanket protective orders entered by a Court) versus entering into written agreements enforceable as contracts to keep the same secrets (contracts).

          But to a Federal Court sitting within the boundaries of the Ninth Circuit, blanket protective orders are not particularized in that they are not directed to a particular document or to particular information for which a party pleads protection from disclosure.  They do not show any specific harm that would result if the material in question were to be disclosed.

          Since they are not particularized, i.e., not directed to particular material, they fail to show good cause for Court-ordered protection of that particular material and so they fail to meet the requirements for a protective order signed by a Court within the Ninth Circuit.   AgJunction LLC v. Ag Leader Tech., Inc., No. CV-20-02204-PHX-SPL, 2021 WL 1969523, at *1-*2 (D. Ariz. March 9, 2021).

            The Court in this case also raised the possibility of an argument that Federal Courts lack the jurisdiction to enter blanket protective orders in the absence of a case or controversy ....

To be continued ....  Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

WHO SIGNED THAT SECRET ORDER? SHH! IT'S A SECRET? WHY?

Who signed the secret order?  Is that a secret too?  Well, it is a secret, so far.  Why?  It was the official act of a person holding a judicial office in the United States District Court for the District of Columbia, and we pay that person's salary.  Comments are open.  Let's identify the official so that the public will know better who and what we are dealing with.

Image on the United States Magistrate Judge Consent Program portal on the website of the U.S. District Court for the Central District of California.

The following article is reprinted from Claims and Issues Blog, where it was originally published on Thursday, May 20, 2021.

The former justice department reportedly used a grand jury subpoena to Twitter to try to identify who was criticizing Devin Nunes on Twitter.  See Charlie Savage, Trump Justice Dept. Tried to Use Grand Jury to Identify Nunes Critic on Twitter, New York Times, online Monday, May 17, 2021.

    In response to this revelation, Washington informants tell the newspapers that the former justice department really tried to use a grand jury subpoena instead to go after critics of Mitch McConnell.

    Regardless of who they were going after in the former regime -- and we can expect many, many more stories of subpoenas and other things to come out as time goes by -- I want to take a look at the secrecy Order that a United States Magistrate Judge apparently signed giving her or his "okay" to using a grand jury subpoena without telling anyone about it.

    A little background for people who may not be familiar with the Courts.   A U.S. Magistrate Judge is not a judge.  She or he is chosen by actual Judges to help them.  Think of a U.S. Magistrate Judge as a kind of Assistant Judge.  Among other things, they review subpoenas.

    Back to the secrecy Order in this case.   I wrote that the U.S. Magistrate Judge "apparently signed" it.  The only copy we have so far is not signed.  Her or his identity is a secret.  Perhaps they are ashamed.  But in any event, their identity is a secret, so far.  Ironic, when you think that the reason for the Order itself is secrecy.

    When this unknown, unidentified Magistrate was presented with a request from the former regime to keep the subpoena a secret, the Magistrate not only granted their request but ordered Twitter "not to notify any other person of the existence" of the subpoena.

    That is why we only recently found out about the existence of the subpoena, and about the existence of the secrecy Order as well.  Not even people trying to take over the justice department for their own interests could have hidden that better.

    Oh, wait ....  Here is the Order:  Download UNSIGNED SECRET TW O.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

BAD FAITH IN PANDEMIC: CRUELTY IS NEVER GOOD, ESPECIALLY NOW.

The Federal Reserve's annual report on the Economic Well-Being of U.S. households has been released.  It is no surprise that the report documents the inequality of economic experiences during the pandemic shutdown for the past year.  See Jeanna Smialek, "Survey Finds Federal Aid Blunted Financial Fallout," New York Times, Tuesday, May 18, 2021, at B4.

          The response of a handful of states, 16 so far, has been to agitate for cutting pandemic-related unemployment benefits.  Those are federally funded benefits that the states will not pay a dime for.  Of course, the state legislators that are against providing pandemic-related unemployment benefits come from a class which knows no-one who needs those benefits.

  Food Pantry.  (Desiree Rios / New York Times)  The people who would be cut from pandemic-related unemployment benefits are of course the ones who need those benefits.  They are unknown to the state legislators who do not need them.  It is easier to be cruel when you do not even know the people who are affected by your behavior.

          It bears repeating here that their cruelty is not our policy.  THE 21% SOLUTION DOES NOT MAKE POLICY FOR US.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

SOCIAL SECURITY DISABILITY INSURANCE, SUPPLEMENTAL SECURITY INCOME, AND MENTAL HEALTH.

In Pelkey v. Comm'r of Soc. Sec. Admin., No. 1:19-cv-11479-IT, 2021 WL 1940621 (D. Mass. May 14, 2021), the District Judge adopted and affirmed a Magistrate Judge's Report and Recommendations regarding Scott Pelkey's claims.  Pelkey claimed Social Security Disability Insurance benefits and Supplement Security Income.  Both claims were denied by the Social Security Administration for lack of evidence in the administrative record.

          Pelkey asked for permission to put recent reports of his treating physicians in the record that supported his claims of mental impairments and mental health conditions that qualified him for SSDI and SSI.  The Magistrate Judge reported that Mr. Pelkey showed "good cause" for his request and recommended that Pelkey's motion to supplement the record be granted.

          The District Judge agreed, based on what was already in the administrative record in this case.  The Court pointed out that while the Commissioner of the Social Security Administration speculated that Mr. Pelkey could have easily obtained the reports of his treating physicians earlier than he did, and put them in the record below, it was just as easy -- and just as irrelevant, ultimately -- to speculate that Pelkey did not obtain the reports confirming his mental impairments earlier than he did, for the very reason that he suffered from the mental impairments he claimed:

Speculation either way is of little import, however, where the Reports were obtained from Plaintiff's treating physicians, without any suggestion of gamesmanship, following further medical examination of an individual with ongoing mental health issues.

Pelkey, 2021 WL 1940621, at *4.

          Sometimes giving people the benefit of the doubt is good law as well as a good practice for living.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

GOT AN INSURABLE INTEREST? DOESN'T MEAN YOU HAVE POLICY RIGHTS.

 

Flying on the Fourth.  (Photo ©Dennis J. Wall)

Florida has an insurable interest statute.  Fla. Stat. § 627.405.  It provides that you have an insurable interest in property whenever you have "any actual, lawful, and substantial economic interest in the safety or preservation of the subject of the insurance free from loss, destruction, or pecuniary damage or impairment." 

          Seems clear, doesn't it?  Seems strong, too, right?

          In fact, it used to be the law that the statute provided the holder of an insurable interest the right to sue under her homeowner's policy.  Not any more.

          In Reconco v. Integon Nat'l Ins. Co., 312 So. 3d 914 (Fla. 4th DCA 2021), an intermediate appellate court in Florida held that the only thing that counts any more to claim rights under the policy -- in that case, a homeowner with an insurable interest in her home was claiming the right to arbitration under the force-placed insurance policy -- is the policy itself.  Force-placed insurance policies often provide that the homeowner is not insured, just like the policy at issue in this case.

          Since the homeowner is not an insured under the force-placed insurance policy, the homeowner may have an insurable interest in her home but the homeowner has no rights under the force-placed insurance policy.  Only the money lender has rights under the force-placed insurance policy.  Reconco, 312 So. 3d at 917-18.

          Think that force-placed insurance issues are a thing of the past, a relic of the 2008-2009 Great Recession?  Think again.  The opinion does not give us a date of when the premiums and the policy were placed by force on the homeowner who legally could never complain, but that does not obscure the fact that the issues are recent and not a thing of the past at all.  The premiums and the policy in this case were force-placed after the homeowner bought the property in 2013, and before 2017 when Hurricane Irma struck her house.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.