Quarterly Review Volume 2 Issue No. 2 Summer 2009 OHIO ASSOCIATION of CIVIL TRIAL ATTORNEYS A Quarterly Review of Contents Emerging Trends President’s Letter ............................................................................... 1 Gretchen Koehler Mote In Ohio Case Law Introduction: Personal Injury Defense Committee ..................... 2 and Legislative Brian D. Kerns Jamey T. Pregon Activity... What Tort Reform Has and Has Not Done to the Statute of Limitations ............................................................ 3 Dennis R. Fogarty Colby Bryson What’s Happening So Far in 2009: Appellate Courts Across Ohio Weigh in on Settlements, Experts and Discovery Disputes ..................................................... 6 Jamey T. Pregon What is Admissible under Robinson v. Bates: The Footnote that Divided the State .............................................. 9 Mark Engling Christopher Leapley In Lang, The Open and Obvious Doctrine Withstood Yet Another Challenge in the Supreme Court. What’s Next? ..................................................................................... 13 Timothy J. Fitzgerald Online Social Networking Sites – A New Tool for Litigators? ............................................................... 16 Mary S. Peterson Are Tort Claimants Necessary Parties to Insurance Coverage Dec Actions? ........................................... 20 Shawn M. Blatt Ohio Association Medical Lien Subrogation Update ................................................ 25 of Civil Trial OACTA Attorneys Patrick S. Corrigan Ohio Supreme Court: Tort Claims and a New Comity ................ 33 The Source for Defense Success Bruce P. Mandel James N. Kline Ohio Board of Trustees Association Kurt D. Anderson (2005) Michael W. Krumholtz (2006) Janik, Dorman & Winter, L.L.P. Bieser, Greer & Landis of Civil Trial OACTA Attorneys 9200 South Hills Boulevard, Suite 300 Cleveland, OH 44147-3521 400 National City Center, 6 N. Main Dayton, OH 45402 (440) 838-7600 • Fax: (440) 838-7601 (937) 223-3277 • Fax: (937) 223-6339 The Source for Defense Success E-mail: email@example.com E-mail: firstname.lastname@example.org Thomas J. Antonini (2007) James L. Mann (2009) Robison, Curphey & O’Connell Mann & Preston LLP Four SeaGate, 9th Floor 18 E. 2nd Street Toledo, OH 43604-1520 Chillicothe, OH 45601-2523 Officers (419) 249-7900 • Fax: (419) 249-7911 (740) 775-2222 • Fax: (740) 775-2627 E-mail: email@example.com E-mail: firstname.lastname@example.org President Gretchen Koehler Mote Kevin Bacon (2008) Amy Mass (2007) Ohio Bar Liability Insurance Co. Farmers Insurance The Hanover Insurance Group 100 E. Campus View Blvd. 500 South Front Street 1650 Lake Shore Drive., P.O. Box 2708 Columbus, Ohio 43235 Suite 870 Columbus, OH 43216-2708 (614) 438-2647 Columbus, OH 43215 (614) 488-7924 • Fax: (614) 488-7936 E-mail: email@example.com (614) 222-3061 • Fax: (614) 222-3079 E-mail: firstname.lastname@example.org E-mail: email@example.com John G. Farnan (2006) Vice President Weston Hurd LLP Mark F. McCarthy (2002) John M. Hands The Tower at Erieview Tucker Ellis & West LLP Ulmer & Berne, LLP 1301 East Ninth Street 1150 Huntington Building 600 Vine Street Suite 1900 925 Euclid Avenue Suite 2800 Cleveland, OH 44114-1862 Cleveland, OH 44115 (216) 241-6602 • Fax: (216) 621-8369 (216) 592-5000 • Fax: (216) 592-5009 Cincinnati, OH 45202 E-mail: JFarnan@westonhurd.com E-mail: firstname.lastname@example.org (513) 698-5122 • Fax: (513) 698-5123 E-mail: email@example.com Richard M. Garner (2008) David W. Peck (2006) Davis & Young, LPA Rendigs, Fry, Kiely & Dennis Secretary 1200 Fifth Third Center One West Fourth Street Gary L. Grubler 600 Superior Avenue, E. Suite 900 Grange Insurance Cleveland, OH 44114 Cincinnati, OH 45202-3688 605 South Front Street (216) 348-1700 • Fax: (216) 621-0602 (513) 381-9226 • Fax: (513) 381-9206 Suite 210 E-mail: firstname.lastname@example.org E-mail: email@example.com Columbus, OH 43215 John J. Garvey, III (2007) Crystal Richie (2006) (614) 449-5900 • Fax: (614) 449-5980 Freund, Freeze & Arnold Gallagher Gams Pryor Tallan & Littrell E-mail: firstname.lastname@example.org 105 E. Fourth Street 471 E. Broad Street, 19th Floor Suite 1400 Columbus, OH 43215 Treasurer Cincinnati, OH 45202 (614) 228-5151 • Fax: (614) 228-0032 Kevin C. Connell (513) 587-3907 • Fax: (513) 665-3503 E-mail: email@example.com Freund, Freeze & Arnold E-mail: firstname.lastname@example.org One Dayton Centre Anne Marie Sferra (2008) One South Main Street, Ste. 1800 Peter J. Hersha (DRI State Representative) Bricker & Eckler LLP Dayton, OH 45402-2017 Vice President – Trial Division 100 South Third Street Nationwide Columbus, OH 43215 (937) 222-2424 • Fax: (937) 222-5369 One Nationwide Plaza, 1-24-10 (614) 227-2394 • Fax: (614) 227-2390 E-mail: email@example.com Columbus, OH 43215 E-mail: firstname.lastname@example.org (614) 249-6851 • Fax: (614) 249-2515 Immediate Past President E-mail: email@example.com (Year indicates first year on board) Gregory E. O’Brien Cavitch, Familo, Durkin & Frutkin, Co., LPA Brian D. Kerns (2008) 1717 East Nineth Street, Fourteenth Floor State Automobile Mutual Insurance Company Executive Director Cleveland, OH 44114-2876 7123 Pearl Road Debbie Nunner, CAE (216) 621-7860 • Fax: (216) 621-3415 Suite 304 OACTA E-mail: firstname.lastname@example.org Middleburg Heights, OH 44130 17 South High Street, Suite 200 (440) 843-5320 • Fax: (440) 843-5324 Columbus, OH 43215-3458 E-mail: Brian.Kerns@SA-trial.com (614) 221-1900 • Fax: (614) 221-1989 E-mail: Debbie@AssnOffices.com James N. Kline (2009) Ulmer & Berne LLP Executive Assistant Skylight Office Tower Cami Collingwood 1660 West 2nd Street OACTA Suite 1100 17 South High Street, Suite 200 Cleveland, OH 44113-1448 Columbus, OH 43215-3458 (216) 583-7000 • Fax: (216) 583-7161 (614) 228-4715 • Fax: (614) 221-1989 E-mail: email@example.com E-mail: Cami@AssnOffices.com President’s Letter Gretchen Koehler Mote Ohio Bar Liability Insurance Co. July 2009 Some of us may remember the days when summer meant things geared down a bit. We certainly haven’t had any “Lazy Days of Summer” at OACTA! This issue of the Quarterly written by members of OACTA’s Personal Injury Defense Committee, chaired by Brian D. Kerns and Jamey T. Pregon, is jam-packed with important articles you’ll want to read to stay current for your pracitce. Medical Lien Subrogation Update by Patrick S. Corrigan is a “must read” article on this topic, complete with checklists of what to do and whom to contact. Timothy J. Fitzgerald’s article titled In Lang, The Open and Obvious Doctrine Withstood Yet Another Challenge in the Supreme Court. What’s Next? discusses some of the more recent Ohio Supreme Court decisions addressing the open and obvious defense, focusing on its most recent opinion in Lang v. Holly Hill Motel, and looks at what may be ahead. Shawn M. Blatt addresses Are Tort Claimants Necessary Parties to Insurance Coverage Dec Actions? in his article informing that the Ohio Supreme Court is now considering the issue in Estate of Heintzelman v. Air Experts, Inc. While Mark Engling and Christopher Leapley note in What is Admissible under Robinson v. Bates: the Footnote that Divided the State that the split in Ohio courts will continue until the Ohio Supreme Court issues a decision reaffirming the admissibility of “write offs” to help a jury determine the amount of reasonable medical expenses to award a personal injury plaintiff. Bruce P. Mandel and James N. Kline discuss recent Ohio legislative enactments and corresponding Ohio Supreme Court rulings, noting DiCenzo v. A-Best Products Company, Inc. (in which the Ohio Supreme Court ruled that its seminal decision in Temple v. Wean United, Inc. could not be applied retroactively and effectively undermined the ability of plaintiffs, particularly in asbestos litigation, to sue non- manufacturer defendants) in Ohio Supreme Court: Tort Claims and a New Comity. What’s Happening So Far in 2009: Appellate Courts Across Ohio Weigh in on Setttlements, Experts, and Discovery Disputes by Jamey T. Pregon highlights that while 2009 is half over, appellate courts throughout Ohio have issued more than a few decisions that deserve our attention. Dennis R. Fogarty and Colby Bryson inform us What Tort Reform Has and Has Not Done to the Statute of Limitations. Keeping us all up-to-date with the latest, Mary S. Peterson poses the question Online Social Networking Sites – A New Tool for Litigators? and discusses how identifying and reviewing a clients, an adversary’s or even a juror’s SNS page may quickly become a matter of due diligence for all litigators. Many thanks to all our authors, to our Editor David Peck, and to Molly May for layout and production of the Summer issue of the Quarterly. I know you’ll find it informative and interesting. . Don’t forget to mark your calendar for the OACTA Personal Injury Defense Committee’s seminar The Art of Personal Injury Defense on Friday, August 28th at State Auto Mutual headquarters in Columbus and the OACTA Golf Outing to benefit NFJE on Tuesday, September 8th at The Pinnacle Golf Club in Grove City (greater Columbus area.) I hope to see you at these OACTA events! 1 Introduction Personal Injury Defense Committee Brian D. Kerns, Committe Chair Kerns and Proe and Jamey T. Pregon, Committee Vice Chair Dinkler Pregon LLC The only real constant in the practice of personal injury defense is change. We’ve seen Tort Reform come and go, come and go and come back again. Decisions like Robinson v Bates, Arbino v Johnson & Johnson, Scott-Ponzer and more recently, Lang v Holly Hill, have had far-reaching implications for how we engage in personal injury defense practice in Ohio. With that in mind, OACTA is constantly striving to keep its members current and when possible, one step ahead of new developments in our practice areas. Last year, in an effort to revitalize our association, Past President Greg O’Brien and the Brian D. Kerns Board of Trustees implemented significant changes to OACTA committee functions and structure. The publication of this issue of the Quarterly is one product of those changes. Many of the articles here were authored by members of the Personal Injury Defense Committee. Vice-chair, Jamey Pregon and I would like to thank each for their helpful, insightful and entertaining contributions. We invite you to become an active member of this committee. Jamey T. Pregon The Personal Injury Defense committee mission statement provides we are: To gather information relevant and important to the attorneys of the Ohio Association of Civil Trial Attorneys, specifically, the attorneys involved in personal injury defense litigation and communicate that information through seminars, scholarly articles and/or transmissions on the world wide web. In an effort to fulfill our association’s goal of serving as a resource for personal injury defense practitioners around Ohio, we also encourage you to attend the first-ever Personal Injury Defense Committee seminar on August 28, 2009. Titled “The Art (and Science) of Personal Injury Defense,” the CLE program will be held at the home office of State Automobile Insurance Companies on East Broad Street in Columbus, Ohio. The presentations will encompass a wide array of topics; from investigations, to medical examinations, to a presentation entitled “How NOT To Lose Your Insurance Company Client.” Included in this program will be views from the trial bench, the plaintiff’s bar, experienced defense lawyers, claims professionals and a luncheon at the Columbus Museum of Art featuring Justice Maureen O’Connor. An agenda for this CLE program is included in this booklet. I encourage you to pre- register as our capacity for the seminar will be limited. CONTINUED ON PAGE 40... Summer 2009 OACTA Quarterly Review 2 What Tort Reform Has and Has Not Done to the Statute of Limitations Dennis R. Fogarty and Colby Bryson Davis & Young Tort reform has always been a highly 2305.10 (LexisNexis 2005). The addition of “accrues” contested and controversial issue in the provides a much clearer definition than the vague “after the state of Ohio. The state legislature cause of action occurs” language contained in the previous recently amended numerous pieces of statutes. tort legislation when it passed Senate Bill 80 (“SB 80”), commonly referred to However, Ohio law provides exceptions for products liability Dennis R. Fogarty as the Tort Reform Act. S.B. 180, 125th suits in the form of a discovery rule for: 1) plaintiffs exposed Gen. Assem. (2005). In an effort to to ethical drugs, medical devices, non-specified hazardous prevent juries from awarding excessive punitive damages chemicals, chromium, asbestos, diethylstilbestrol, other and to promote fairness, the legislature enacted numerous nonsteroidal synthetic estrogens; and 2) veterans exposed damage caps. Although these damage caps garner most of to herbicides, defoliants, agent orange, and other causative the public’s attention, the legislature’s recent reform has agents. The causes of actions that fall under each of these been highlighted by several amendments to the statutes of exceptions accrue when either: a) a competent medical limitations and repose for various torts. The sweeping authority informs the plaintiff that his injury is related to effects of these amended statutes cannot be overlooked, as exposure or hazardous or toxic chemicals; or b) the date some have already been challenged in the Ohio Supreme that the plaintiff should have known that the injury is related Court. See Groch v. General Motors Corp (2008), 117 Ohio to his/her exposure. R.C. 2305.10. Thus, a plethora of St. 3d 192; 883 N.E.2d 377 (upholding the 10-year statute plaintiffs now have the ability to file products liability suits of repose for products liability). These statutory changes after the two-year limitation that is applied in normal cases. have considerably restricted plaintiffs in their ability to file claims and collect damages for certain causes of actions, The legislature also included a 10-year statute of repose for while providing additional time and opportunities to file products liability claims under this recent reform. Pursuant claims for other causes of actions that they could not have to this reform, a plaintiff is prohibited from filing a products pursued previously. Despite the significant changes in liability action against a manufacturer or supplier later than several areas of tort law, the statutes of limitations and 10 years from the date that the product was first placed into repose for several other tort claims have gone unchanged. the stream of commerce. If the cause of action accrues less Given the recent history and current sentiment of the Ohio than two years prior to the expiration of the 10-year period legislature, however, the tort landscape may change of repose, however, a plaintiff has two additional years from dramatically once again in the near future. when the cause of action accrued to file his/her claim. R.C. 2305.10. This statute of repose was challenged in Groch Products liability cases have arguably been the most supra, but the Ohio Supreme Court upheld its significantly affected by the altered statutes of limitations. constitutionality; explaining that, “Unlike a true statute of Although the previous two-year limitation remains, several limitations, which limits the time in which a plaintiff may restrictions and specifications have been added to bring suit after the cause of action accrues, a statute of definitively determine when plaintiffs are permitted to repose potentially bars a plaintiff’s suit before the cause of institute a products liability claim. Generally, a plaintiff must action accrues.” Id. at 211. Therefore, “the constitutionality file his/her claim within two years after the cause of action of any specific statute of repose should turn on the accrues (date of injury or loss). Ohio Rev. Code Ann. § CONTINUED... 3 particular features of the statute at issue, and such a statute Although intentional torts committed by employers clearly should be evaluated narrowly within its specific context.” overlap and may include bodily injuries, personal property Id. at 216. When analyzing the statute in the narrow context injuries, and wrongful death, Ohio law previously imposed a of products liability, the court thus found the statute of one-year limitation on employer-related intentional tort repose constitutional. Thus, the ten-year repose statute claims. However, the legislature recently repealed this restricts the discovery rule exception by prohibiting plaintiffs statute of limitations in an effort to provide consistency and from filing products liability claims more than ten years after logic in its tort legislation. Prior to the official repeal, the the product was first introduced into the stream of Ohio Supreme Court rendered the one-year limitation commerce. Still, the repose statute has “certain ineffective. Funk v. Rent-All Mart, Inc. (2001), 91 Ohio St. 3d exceptions,” which leaves the door open for special cases 78; 2001 Ohio 270; 742 N.E.2d 127, citing Johnson v. BP that involve unique circumstances. R.C. 2305.10. Chemicals, Inc. (1999), 85 Ohio St. 3d 298, 707 N.E.2d 1107 (the enabling statute which permitted the one-year Wrongful death suits have also been affected by SB 80, as a statute of limitations (R.C. 2745.01) was unconstitutional). two-year statute of limitations after the cause of action As a result of the recent reform, causes of action regarding accrues (date of injury) now restricts a plaintiff’s suit. R.C. an employer’s intentional torts now fall under the same two- 2125.02. If the wrongful death suit involves some sort of year statute of limitations imposed for bodily injury and product liability, however, the applicable product liability wrongful death, a significant change that grants plaintiffs an limitations apply (exceptions in the form of a discovery rule additional year to file their claims against employers. R.C. for plaintiffs exposed to aforementioned drugs, statute of 2125.02; R.C. 2305.10. repose for claims against manufacturer or supplier later than 10 years from the date the product was first placed SB 80 restricted claims regarding defective and unsafe into the stream of commerce). Thus, plaintiffs may now conditions in improvements to new property. Unlike the pursue wrongful death suits related to products liability that previous legislation which did not include a statute of were barred by Ohio’s previous statute of limitations. limitations governing these claims and thus allowed a plaintiff to file a claim at any time, the recently enacted Similarly, the slightly-altered statute of limitations for actions reform imposes a 10-year statute of repose for concerning damages for bodily injury or injury to personal improvements to real property, relative to designer property has provided plaintiffs a larger window of professions, construction contractors, and subcontractors, opportunity to pursue claims. Although the two-year time unless fraud is involved. R.C. 2305.131. Still, it should be limit remains, the duration is now measured from the date noted that a claimant who discovers a defective and unsafe that the cause of action accrues (date of injury), R.C. condition of an improvement to real property during the ten- 2305.10, unlike the previous limitation that measured the year period but less than two years prior to the expiration of two years from the time that the cause of action arose, that period may commence a civil action to recover which may or may not have been the date of the injury damages as described in that division within two years from occurrence. Additionally, the two-year window may be the date of the discovery of that defective and unsafe extended if the claim involves product liability and/or condition. R.C. 2305.10. eventual wrongful death. In each of those cases, the statute of limitations for products liability (exceptions in the form of Despite the significant changes in several types of tort a discovery rule for plaintiffs exposed to aforementioned claims, the statutes of limitations for other causes of action drugs, statute of repose for claims against manufacturer or remain the same. Breaches of oral and written contracts, supplier later than 10 years from the date the product was for example, continue to contain a 15-year and six-year first placed into the stream of commerce) or wrongful death statute of limitations, respectively. In the commercial (two years after the cause of actions accrues (date of sector, claims arising under the Consumer Sales Practices death)) will subsequently apply. Act continue to be restricted by a two-year statute of limitations. R.C. 1345.10. Summer 2009 OACTA Quarterly Review 4 Intentional tort claims have largely gone unchanged as well. The limitation for assault and battery claims remains one Dennis Fogarty has been with Davis and Young in year, while the limitation for assault and battery by a mental Cleveland since 1991. His practice areas include health professional; sexual contact or conduct continues to medical malpractice and insurance casualty be two years. R.C. 2305.111; R.C. 2305.115. Further, defense. He also has experience in complex intentional acts of sexual abuse or other acts continue to commercial coverage disputes in the areas of carry the same one-year statute of limitations for adult construction, employment and intellectual property. victims. R.C. 2305.11. The legislature has also maintained He counsels clients in complex litigation matters the statute of limitations established in Doe v. First United including UM/UIM, products liability and commercial Methodist Church (1994), 68 Ohio St.3d 531, when the cases. He defends both hospitals and doctors in victim of intentional sexual abuse or other acts is a minor. malpractice litigation. Pursuant to Doe, a minor has one year from the age of the majority where the victim knows the identity of the perpetrator and is fully aware a battery has occurred to file a Colby Bryson in a second-year law student at Case claim. Additionally, the four-year statute of limitations for Western Reserve University and a Summer trespass, recovery of personal property, conversion, fraud Associate at Davis & Young. and other torts not covered by R.C. 2305.10 to R.C. 2305.12 remains unchanged. And rounding outing the unchanged statutes of limitations for intentional torts is the one-year window to file libel, slander, malicious prosecution, false imprisonment, and abuse of process claims. R.C. 2305.11. Although the legislature has instituted several somewhat complicated damage caps regarding malpractice claims, the statute of limitations for these causes of action have also gone unchanged. Pursuant to R.C. 2305.11, plaintiffs are given one year to file malpractice claims against lawyers, psychologists, social workers, or clinical counselors. A similar one-year statute of limitations exists for medical malpractice claims; but this limitation is subject to a 180- day extension. The passing of Senate Bill 80 marked the state’s first Visit the significant tort reform legislation in several years. The OACTA website amended statutes of limitations and repose have vastly altered the tort claims landscape, restricting numerous for information on claims while expanding the opportunity to file several others. Still, several statutes of limitations and repose for several OACTA seminars other tort actions have gone unchanged. Given the current sentiment of the legislature, however, these statutes may and activities: change in the near future if the circumstances call for such reform. www.OACTA.com 5 What’s Happening So Far in 2009: Appellate Courts Across Ohio Weigh in on Settlements, Experts and Discovery Disputes Jamey T. Pregon Dinkler Pregon LLC The year is half over, and appellate attorney did not have apparent authority to settle the case. courts across Ohio have issued more While attorneys have apparent authority to negotiate on than a few decisions that should get behalf of their clients, the Court held that attorneys do not the attention of personal injury have apparent authority to enter into settlements on behalf defense attorneys. Several of these of their clients. The defendant in Adkins unsuccessfully decisions have come in three key sought review with the Ohio Supreme Court. areas: (1) settlement of cases, (2) expert testimony, and (3) discovery of medical records and 2. What if the Plaintiff stiffs you on a related materials. As the age old warning goes, “be careful subrogation lien? In the Fifth District, you cannot go to out there.” the trial court and ask for the settlement to be enforced. In McDougal v. Ditmore, 2009-Ohio-2019, Start App. No. 2008 I. Settlement Issues CA 00043, the Fifth District held that a trial court no longer 1. When is a settlement not a settlement? In has jurisdiction to decide a motion to enforce a settlement Adkins v. Estate of Place, 2009-Ohio-526, Clark App. No. once a dismissal entry with prejudice is filed. The plaintiff, 08-CA-73, the Second Appellate District framed the issue by the terms of a settlement agreement with the tortfeasor, presented in that case as follows: “One might think that an agreed to pay a subrogation lien out of the settlement attorney retained to represent a client in connection with a proceeds. When the plaintiff failed to do so, the tortfeasor matter in litigation would have apparent authority to settle moved to enforce the settlement, and the trial court granted that matter on behalf of the client, but the rule in Ohio is the motion. clearly otherwise.” In Adkins, the plaintiff’s attorney communicated a settlement offer to his client, and then The Fifth District reversed, holding that unless the dismissal received a message from the client stating to “go ahead entry indicates the trial court reserves limited jurisdiction to with it.” Following the message, the plaintiff’s attorney decide matters related to a voluntary settlement agreement. advised defense counsel the settlement offer was This may signal that state courts are following the trend in accepted, and the trial court was contacted and advised Federal courts. See, e.g., Kokkonen v. Guardian Life Ins. Co. the case was settled. Later that day, the plaintiff’s attorney of America, 511 U.S. 375, 381, 114 S. Ct. 1673, 128 L. Ed. was told by his client that he did not mean to take the 2d 391 (1994); Chao v. Am. Nat’l Fleet Servs., 2008 U.S. settlement offer, but instead, to “go ahead with” the trial Dist. LEXIS 51244 (N.D. Ohio 2008). In any event, the deposition of plaintiff’s treating chiropractor. safest course of action is to include language in your dismissal entry that permits the trial court to retain The trial court refused to reactivate the case, and ordered jurisdiction over the enforcement of the parties’ settlement that the settlement be enforced. The Second District agreement. reversed the trial court, and remanded the case for an evidentiary hearing on whether the plaintiff’s attorney had II. Expert Witnesses actual authority from his client to settle the case. 1. Can you ask the plaintiff’s medical expert However, the Second District held that the plaintiff’s “possibility” questions on cross-examination? The Summer 2009 OACTA Quarterly Review 6 answer to this question is that it depends on why you are While the doctor’s suspension was fair game on cross- asking the question. The Tenth District, in Bruce v. Junghun, examination to attack the doctor’s credibility, the 2009-Ohio-2151, Franklin App. No. 08AP-837, recognized suspension did not disqualify the doctor as an expert that cross-examination may use “possibility” evidence to witness for the plaintiff. “chip away” the plaintiff’s case, but defense counsel cannot use the plaintiff’s expert to express an opinion on an 3. What if you have no expert to contradict the alternative cause theory based solely upon “possibility” plaintiff’s expert on causation? In Decapua v. Rychlik, evidence. 2009-Ohio-2029, Cuyahoga App. No. 91189, the Eighth District was presented with a case where the defense In Junghun, defense counsel asked plaintiff’s treating doctor presented no expert testimony to challenge the plaintiff’s if he could rule out defense counsel’s alternative cause expert testimony regarding the relatedness of the plaintiff’s theory, which was the plaintiff’s age and level of activity medical treatment and bills. The jury still awarded the caused degeneration in the plaintiff’s shoulder, rather than plaintiff less than his medical specials, and the plaintiff the automobile accident, and the doctor stated he could not appealed, arguing the award was against the manifest rule those theories out. The trial court excluded this weight of the evidence in that the plaintiff presented testimony, holding that this was an opinion that must be uncontroverted expert testimony as to the proximate cause stated in terms of a reasonable degree of medical of the plaintiff’s injury and treatment. probability. The Tenth District agreed, and affirmed the exclusion of the doctor’s testimony. The Eighth District rejected the plaintiff’s argument, holding that “‘simply because plaintiff’s expert testified that the 2. Does the plaintiff’s doctor still qualify as an billings were necessitated by the accident, they are not expert at trial if the doctor’s license has been automatically entitled to prevail on the question of suspended? The Second District said that a plaintiff’s necessity, even where their expert’s testimony on that point doctor may still give expert testimony at trial so long as the is not directly controverted by defendant’s evidence, so long doctor was licensed at the time the doctor treated the as there appear in the record objectively discernible reasons Plaintiff. In Ray v. Ramada Inn North, 2009-Ohio-1278, upon which the jury could rely to reject the expert’s opinion Montgomery App. No. 22808, the plaintiff’s treating doctor testimony.” The Court noted that two other appellate was convicted of False Statements Relating to Health Care districts—the Tenth and the Second—have reached the same Matters, in violation of 18 U.S.C. §1035, and his medical conclusion. See Walker v. Holland, 117 Ohio App.3d 775 license was suspended for two years. Defendant argued (1997); McBride v. Quebe, 2006-Ohio-5128, 2d Dist. No. that the doctor was not qualified to testify as an expert at 21310. trial, relying upon O.R.C. §2743.43, which applies to medical malpractice claims. The trial court agreed, and III. Medical Discovery precluded the plaintiff’s doctor from giving expert testimony 1. Can you get all of the plaintiff’s prior medical at trial. records in discovery? The answer to this question lies in the discretion of the presiding trial court. In Cargile v. The Second District reversed the trial court, holding that Barrow, 2009-Ohio-371, Hamilton App. C-080423, the First Evidence Rule 702 governed the admissibility of expert District reversed a trial court’s order compelling a plaintiff to testimony, rather than O.R.C. §2743.43. The Court noted sign authorizations for all medical providers prior to the that a witness need not have a special certification or plaintiff’s automobile accident. The plaintiff had objected license in order to qualify as an expert so long as the based upon the physician-patient privilege, and argued that knowledge the witness imparts will aid the trier-of-fact in the requested records had nothing to do with the plaintiff’s understanding the evidence or determining a fact in issue. personal injury claim. CONTINUED 7 The First District followed the Ohio Supreme Court’s decision against the defendant, “the blood test results…would not fit in Peyko v. Frederick, 25 Ohio St.3d 164 (1986), and the exception to the privilege in the instant case, since this ordered that the challenged medical records are subject to is a civil matter.” The plaintiff presented the trial court with an in camera inspection by the trial court to determine evidence that the blood test was not ordered by law whether the records are discoverable. The Court noted that enforcement. Citing this evidence, the Eleventh District “although Peyko was about attorney-client privilege in a case reasoned that “Since the instant matter is a civil case and involving insurance claims, it is instructive here.” the evidence the Sullivans are seeking appears to have been obtained for the purpose of medical treatment or The Eighth District reached the same conclusion in Wooten diagnosis, both the records and the results of the blood test v. Westfield Ins. Co., 2009-Ohio-494, Cuyahoga App. No. are protected as a privileged communication pursuant to 91447. The Eighth District reversed a trial court’s decision R.C. 2317.02 and thus not subject to discovery under the denying the plaintiff’s motion for a protective order regarding civil rules.” the defendant’s request to obtain all of the plaintiff’s prior medical and pharmaceutical records. Although the Court The Eleventh District declined to announce a bright line rule noted that “the physician-patient privilege does not apply on this issue, and ordered the case back to the trial court on when the patient files a civil action putting her physical or remand to conduct an evidentiary hearing, accept mental condition at issue,” the Court further noted that this stipulations from the parties, or conduct an in-camera exception to the privilege only applies to prior treatment that review of the requested information to determine whether is “related causally or historically to physical or mental the totality of the circumstances surrounding the injuries that are relevant to issues in the medical claim.” administration of Smith’s blood-alcohol test warrants the The Court remanded the case to the trial court with the application of the privilege. instruction to conduct an in camera inspection of the requested records. 2. Is your client’s blood alcohol test discoverable? In most cases, the answer will be no, Jamey T. Pregon is a partner in the Dayton law firm according to the Eleventh District in Sullivan v. Smith, 2009- of Dinkler Pregon LLC, and the vice chair of the Ohio-289, Lake App. No. 2008-L-107. The plaintiff claimed Personal Injury Defense Committee. His practice personal injuries from an automobile accident, and the focuses on litigation at all stages, including trial and defendant had been charged with a DUI following the appellate work, and focuses on personal injury accident. The Eleventh District noted that the physician- defense, insurance coverage and bad faith, premises patient privilege is not applicable in any criminal action liability, governmental liability, employment law, and concerning any test or the results of any test that determines civil rights defense. He is a member of the Ohio the presence or concentration of alcohol or any other Association of Civil Trial Attorneys, Defense Research controlled substance. The defendant refused to provide an Institute, the Ohio State Bar Association, and the authorization for the blood alcohol test conducted at the Dayton Bar Association. emergency room following the automobile accident, and the plaintiff moved to compel the defendant to sign an authorization. The trial court ordered the defendant to sign the authorization. The Eleventh District reversed the trial court’s order. The Court noted that if the blood test was taken at the direction of law enforcement for the purposes of criminal proceedings Summer 2009 OACTA Quarterly Review 8 What is Admissible under Robinson v. Bates: The Footnote that Divided the State Mark Engling and Christopher Leapley Freund, Freeze & Arnold In Ohio, a handful of Supreme Court In Robinson, the Supreme Court ruled that the reasonable decisions invoke immediate recognition value of medical services rendered may be “the amount amongst personal injury defense originally billed, the amount the medical provider accepted attorneys regarding the legal debates as payment, or some amount in between.”8 The court they commenced or resolved – Sheward, further held that “any difference between the original Scott-Pontzer, Galatis, Armstrong v. Best amount of a medical bill and the amount accepted as the Mark Engling Buy, Fidelholtz. Another decision from bill’s full payment is not a ‘benefit’ under the collateral- Ohio’s highest court can now be added to source rule because it is not a payment, but both the original that list, not for its holding (which is fairly bill and the amount accepted are evidence relevant to the clear), but for the seemingly unintended reasonable value of medical expenses.’”9 debate now playing out in Ohio’s trial and appellate courts over one of its On its face, the Robinson decision does not appear to leave footnotes. Indeed, footnote 1 of the room for argument. The Court expressly found that write- Robinson v. Bates decision is the 1 offs are not benefits, and are not excluded by the collateral hairline scratch that has ultimately split source rule. Thus, an amended collateral source statute Christopher Leapley Ohio courts into two profoundly different would seemingly be irrelevant to the “reasonable medical camps. This divide will continue until the expenses” analysis. Supreme Court issues another immediately recognizable decision reaffirming the admissibility of “write offs” to help a A single footnote, used by the Supreme Court to explain why jury determine the amount of reasonable medical expenses the Court did not address a recently-enacted statute in its to award a personal injury plaintiff. decision, led to plaintiffs lawyers all over the state questioning the admissibility of write-offs at trial. Footnote 1 In Ohio a plaintiff who suffers injuries caused by a tortfeasor of the Robinson decision states in pertinent part: may recover the reasonable value of his medical treatment. 2 “We note that, effective April 7, 2005, the Until recently, just how this reasonable value was to be General Assembly passed R.C. 2315.20, a determined was not in question. Injured parties were statute titled ‘Introduction of collateral permitted to admit evidence of their medical bills, which benefits in tort actions.’ The purpose of was presumed to be prima facie evidence of this statute was to set forth Ohio’s reasonableness.3 Defendants would then offer evidence statement of law on the collateral-source intending to refute this presumption and establish that the rule. The new collateral-benefits statute medical costs billed were neither reasonable nor does not apply in this case, however, necessary. Evidence of reduced amounts accepted as 4 because it became effective after the payment would be one such example of this evidence. 5 cause of action accrued and after the Robinson v. Bates addressed the issue of whether evidence complaint was filed.”10 of medical “write-offs” is admissible to establish the reasonable value of medical treatments rendered,6 and It should be noted that nowhere in the Robinson decision whether such evidence runs contrary to the “collateral does the Court state their ruling would be any different if the source rule.”7 statute were in effect at the time the cause of action CONTINUED 9 accrued. Despite this, many plaintiffs have latched onto As mentioned above, the majority of jurisdictions this footnote arguing that the Court, by implication, found considering this issue have ruled that “write-offs” constitute that after the effective date for R.C. 2315.20, evidence of valid and admissible evidence to establish the reasonable write-offs became inadmissible with respect to the value of medical services rendered. These counties, in reasonable value of an injured plaintiff’s medical expenses. alphabetic order, are13: Ashland14, Athens15, Erie16, Although many Ohio courts have still not addressed the Fairfield17*, Franklin18*, Hamilton19, Licking20*, Lucas21*, issue, those that have are split on the question of whether Mahoning22, Montgomery23, Stark24, Summit25, Williams26 the write-off amount is admissible. As discussed below, and Wood27. In addition to these counties, Ohio’s Tenth however, the majority of decisions on the issue line up on District, as well as the Northern and Southern District Courts the fault line in favor of “write off” admissibility. have ruled that evidence of write-offs are admissible. Perhaps the most cited case on this subject is the Northern Plaintiffs primarily focus on the footnote’s language. They District of Ohio’s recent decision of Schlegel v. Li Chen argue the Court’s ruling would have been different had the Song.28 In Schlegel¸ the plaintiff argued that Robinson had statute been in effect. The argument evolves into a claim been superseded “because [R.C. 2315.20] became that R.C. 2315.20 supersedes the Robinson decision on the effective after the cause of action accrued [in admissibility of write-offs. Plaintiffs largely ignore the Court’s Robinson]…”.29 The Federal Court rejected this argument, holding that write-offs are not benefits, and instead focus on stating that “even if Robinson did not apply to the case at the fact the insurers who have paid these benefits are bar, [R.C. 2315.20] certainly applies, and the Robinson afforded subrogation rights. Therefore, as the argument Court acknowledged that once the statute became effective goes, R.C. 2315.20 precludes evidence of write-offs. the rule would be become even more limited than as applied by that court.”3031 Defendants on the other hand, argue that R.C. 2315.20 only applies to those benefits payable to the plaintiff, and that The Court of Appeals for Ohio’s Tenth District recently ruled write-offs, according to the express holding in Robinson, are in line with Schlegel.32 . The court based its ruling on the not paid. Defendants also give the footnote its due rationale contained in Shlegel and Robinson that there is a consideration, arguing it was included by the Supreme Court lack of “benefit received by the plaintiff” as a result of the as an explanation as to why it did not address the newly- write-off amounts.33 enacted statute. Defendants usually point out the undeniable fact that there is no statement in Robinson that As noted above, many of Ohio’s common pleas courts have the Supreme Court would have decided the issue differently also ruled that evidence of write-offs are admissible at trial. had the statute been applied to the case. Two such courts are Erie County and Hamilton County. The Erie County Common Pleas Court stated: “the Supreme To date, no fewer than twenty Ohio common pleas courts Court held [in Robinson] that the ‘write-off’ is not a collateral have considered this issue. In addition, two state appellate source ‘benefit’ [therefore] R.C. 2315.20 is still inapplicable courts, and the Federal Court for the Northern District of because the ‘write off is not a collateral source benefit.’”34 Ohio have also weighed in. Of these courts, at least fourteen Likewise, Hamilton County’s Common Pleas Court ruled: trial courts ruled that evidence of write-offs is admissible, 11 “amounts written off by medical care providers are not along with the 10th District Court of Appeals and the subject to the collateral source rule.”35 Northern District of Ohio. On the other hand, eleven trial courts12 and the Sixth District Court of Appeals ruled that The Williams County Common Pleas Court also considered such evidence was inadmissible. At the time of this writing, the application of R.C. 2315.20 to the admissibility of write- the authors were not aware of any cases pending before the offs at trial. The Court ruled: “R.C. 2315.20 does not repeal Ohio Supreme Court or any other state appellate courts Ohio’s common law collateral source rule; it simply limits [its regarding this issue. application] where the Plaintiff’s insurer is subrogated.”36 The court ultimately ruled that the rationale found in Summer 2009 OACTA Quarterly Review 10 Robinson as to why the collateral source rule does not apply source rule is controlled by RC. 2315.20, and not by the rule to write offs applies to all forms of the collateral source set forth in [Robinson].”52 rule.37 As a result, the court reasoned that RC. 2315.20 does not apply to the writen-off portion of bills because the A Lucas County court also ruled that R.C. 2315.20 write offs are expenses that were never paid, and hence not supersedes the Robinson decision.53 The court stated: “the a benefit. cause of action…accrued after the effective date of R.C. 2315.20. Therefore, it is the statute, rather than the Court’s Montgomery County also recently weighed in on the issue. decision in Robinson, that applies.”54 Judge Michael Tucker ruled that the plaintiff is “entitled to recover from the tortfeasor the reasonable and necessary Although most of the other decisions excluding the medical expenses incurred.”38 Judge Tucker reasoned that admission of evidence of write-offs follow the same the amount written off does not constitute a collateral rationale, there are a couple decisions that adopted differing benefit and therefore is not affected whatsoever by RC. views that are worth noting. 2315.20. Another decision from Lucas County found that write-offs are in fact “paid.”55. The court stated: “[a]fter careful These cases emphasize the majority law in Ohio that consideration, this Court finds that the difference in the because a write-off is a portion of the bill which is never amount billed and the amount accepted, the ‘write-off,’ is paid, it does not constitute a benefit. As such, it is not paid by insurance companies through negations with governed by the collateral source rule, and R.C. 2315.20 medical providers…”56 This appears to be the beginning of a has no effect on its admissibility. Under the majority of new line of authority questioning the Supreme Court’s jurisdictions in Ohio, a plaintiff is entitled to receive that holding that write-offs do not constitute the payment of a amount of money representing the reasonable value of his benefit. medical treatment. What a plaintiff is not entitled to receive is a windfall simply because his insurance company chooses The Lorain County Common Pleas Court offered another line to negotiate a lower final payment. Defense attorneys of reasoning when it ruled that evidence of write-offs should should, nonetheless, be careful out there since the not be admitted in the interest of judicial efficiency.57 The “majority” position would hold little to no persuasive effect court stated: “[s]ince Robinson v. Bates, the courts and in the “minority” jurisdictions and only provide guidance in litigants have seen the practical effects of the ruling. those jurisdictions that have not addressed the issue. Additional time and resources are spent on gathering the The split in authority on this topic is demonstrated by the records, trying to decipher payments [etc.]…This extra paper more than eleven trial courts that have come down on the work for the litigants, the providers, and the courts seems to opposite side of this debate. These jurisdictions are located create a potential for confusion in the courtroom with an primarily in the northern half of the state, and include the inordinate amount of time spent on these issues…”.58 This common pleas courts in the counties of: Cuyahoga39; decision only permit the jury to see the plaintiff’s original Fairfield *, Franklin *, Fulton , Lake , Licking *, 40 41 42 43 44 medical bills if it would simplify discovery and the issues Lorain , Lucas *, Seneca , Stark *, Summit *. 45 46 47 48 49 at trial. Additionally, the Court of Appeals for Ohio’s Sixth District has The cases cited above are intended to serve as examples of also lined up on the opposite side of the fault line. 50 some arguments and the resulting rulings that arose from a debate spawned by one footnote. Until the Supreme Court The Sixth District reasoned that R.C. 2315.20 supersedes decides to clarify the relationship between the Robinson the Robinson decision.51 The court stated: “[i]t is decision and R.C. 2315.20, the debate will continue and the undisputed that this case arose after the enactment of R.C. split may widen.59 2315.20 … Accordingly, the application of the collateral CONTINUED 11 Endnotes 35 Hatfield v. Berry, (July 16, 2008), Hamilton County Case No 1 Robinson v. Bates, 112 Ohio St.3d 17. A-0802688. 2 Id. at 19. 36 Thomas v. Singer (June 31, 2007) Williams County Case No. 06 3 Id.; RC. 2317.421. – CI – 21 4 Id. 20 37 Id. 5 Id. 22 38 Hudson v. State Farm (August 7, 2008) Montgomery County Case 6 The difference between the amount originally billed by the No. 2007-CV-9278. medical provider and the amount ultimately accepted as “payment 39 Multiple rulings, including Gati v. Moore (September 3, 2008), in full” is known as the “write-off” amount. Id. at 22. Case No: 07-CV-652662; Samano v. Suleiman (September 4, 7 The collateral source rule was established in Ohio in Pryor v. 2008), CI-07-644144. Webber and prevents a jury from learning of payments made to a 40 Caudill v. Lemaster (October 8, 2008), Case No: 07-CV-847 plaintiff from a source other than the tortfeasor in determining 41 Attard v. Williamson (June 18, 2008), Case No: 07-CV-257 plaintiff’s recovery. 42 Clausen v. Lester (November 11, 2007), Case No: 06-CV-268 8 Robinson v. Bates, at 23. 43 Unreported case decided by Judge Collins (copy available upon 9 Id. request) 10 R.C. 2315.20 reads: “(A)In any tort action, the defendant may 44 Decision by Judge Spahr in Hudnall case (Case Number unknown) introduce evidence of any amount payable as a benefit to the 45 Rivera v. Urbansky (June 26, 2008), Case No: 08-CV-154436 plaintiff as a result of the damages that result from any injury, 46 Chang v. Uzunel (March 13, 2008), CI-07-03625 death or loss of person or property that is the subject of the claim 47 Rivers v. Miller (April 29, 2009) Case No: 08 CV 0396 upon which the action is based, except if the source of collateral 48 Stewart v. Fitness Quest (June 27, 2007), Case No: 07-CV-223 benefits has a mandatory self-effectuating federal right of 49 Bender v. Waste Management of Ohio (April 30, 2008), CV-07-09- subrogation, a contractual right of subrogation or if the source 6769 pays the plaintiff a benefit that is in the form of a life insurance 50 Jacques v. Manton (March 20, 2009), Case No: L-08-1096. payment or disability payment…” 51 Id. 11 In addition to the jurisdictions cited, the authors are aware of 52 Id. at 3. several additional jurisdictions which have ruled orally or with an 53 Palm v. Beirmeister (July 31, 2007) Lucas County Case No. CI unpublished opinion on this issue. For the sake of accuracy, the – 06 – 3579. authors have not listed any courts that were not verified by first- 54 Id. hand evidence. As a result, some jurisdictions which have to date 55 Goney v. Hill Lucas County Case No: CI-06-5002 only issued oral decisions or unwritten entries are not included in 56 Id. this list. 57 Rivera v. Urbansky Lorain County Case No: 08-CV-154436. 12 See n.11 58 Id. 13 An * by a county’s name indicates that the county in question has 59 At the time of the writing of this article, the authors were not aware had rulings go both directions regarding this issue since the of any cases related to this issue pending before the Ohio effective date of R.C. 2315.20. Further note that while every Supreme Court. attempt has been made to identify unreported cases, it was at times necessary to provide only as much information as could be located in a reasonable effort. 14 Unreported decision issued by Judge Woodward. (copy available upon request) 15 Bauder v. Porter (May 2, 2008), Athens County Case No: 07 CI 0219. Mark Engling is a civil litigation associate in the 16 Hockenberry v. Platt (2006) Erie County Case No: 2006 CV 0386 17 Unreported decision issued by Judge Martin. (copy available upon Dayton office of Freund Freeze & Arnold. His request) 18 Kalinoski v. Strapp (2007) Franklin County Case No: 2007 CV practice involves construction law; real estate broker 005259. malpractice; insurance bad faith and coverage; 19 Hatfield v. Berry: July 16, 2008, Hamilton County Case No A- 0802688. premises liability; and state and federal consumer 20 Unreported decision in Morris case by Judge Marcelain. (copy available upon request) protection laws. He has represented clients in state 21 Multiple cases, including: Brisbane v. Gattett, Case No: CI -07- and federal courts, and the Ohio Civil Rights 3455; Vogelsang v. Pope, Case No: CI-06-4195. 22 Unreported decisions from both judges Kirchbaum and Durkin. Commission. Mark is a member of the Ohio State (copies available upon request) 23 Hudson v. State Farm, (August 7, 2008) Montgomery County Case and Dayton Bar Associations. No. 2007-CV-9278. 24 Multiple decisions, including: Knight v. Hunt (December 6, 2007) Case No: 2007 – CV – 03059. 25 Diblasi v. Mitchell (July 16, 2008) Case No: CV 07 06 4183 26 Thomas v. Singer (January 31, 2007) Case No: 06 – CI – 21. Christopher Leapley is an associate in the Dayton 27 Sondergeld decision, by Judge Pollex. (copy available upon office of Freund Freeze & Arnold where he practices request) 28 (2008) 547 F.Supp.2d 792 various forms of insurance defense. Mr. Leapley is a 29 Id. at 799 30 Id. (first emphasis added, second in original). 2008 graduate of the University of Dayton School of 31 See also Bransteter v. Moore (2009), 2009 WL 152317 (N.D. Ohio). Law where he was a member of the Law Review, 32 See Salvatore v. Findlay (2008), 2008 WL 2588547 33 Id. at 4. and a 2004 graduate of Wright State University. 34 Hockenberry v. Piatt, (2006) 2006 – CV –386 (unreported) (emphases added). Summer 2009 OACTA Quarterly Review 12 In Lang, The Open and Obvious Doctrine Withstood Yet Another Challenge in the Supreme Court. What’s Next? Timothy J. Fitzgerald Gallagher Sharp The open and obvious doctrine is one of When hazardous conditions are open and obvious, property the long-standing and most effective owners owe no duty to protect invitees from the dangers legal principles in a defense attorney’s because they are “known to such invitee or are so obvious arsenal to secure a quick dismissal of a and apparent to such invitee that he may reasonably be premises liability lawsuit. Challenges to expected to discover them and protect himself against the open and obvious doctrine have met them.”9 The open and obvious doctrine “obviates the duty to with some limited success over the warn and acts as a complete bar to any negligence claims” years as courts have recognized certain exceptions to the because “‘the owner or occupier may reasonably expect that doctrine that oftentimes are used to defeat a premises persons entering the premises will discover those dangers owner or occupier’s summary judgment motion. Despite 1 and take appropriate measures to protect themselves.’”10 repeated and ongoing efforts by the plaintiff’s bar to bring Whether a hazard is an open and obvious condition is a about the abolition of the open and obvious doctrine, the matter of law to be determined by the court making it Supreme Court of Ohio has been steadfast in holding that perfectly suited as a proper basis for summary judgment.11 the open and obvious doctrine remains viable as the law in Ohio.2 Yet, there are chinks in the doctrine’s armor. This An early challenge to the doctrine followed on the heels of article takes a look at some of the more recent Ohio Ohio’s adoption of the comparative negligence statute. In Supreme Court decisions addressing the open and obvious the wake of that change in Ohio law, some courts found the defense, focusing on its most recent opinion in Lang v. Holly open and obvious doctrine had been abrogated by the Hill Motel, and takes a brief look at what may be coming in 3 comparative negligence analysis, but the Supreme Court has the near future. made it abundantly clear that the doctrine is not concerned with evaluating the plaintiff’s own negligence or looking at A common law premises liability action can be maintained what was the proximate cause for the fall.12 However, the only if a plaintiff establishes the existence of a legal duty, a open and obvious doctrine is a defense available only to breach of that duty, and that the plaintiff’s injuries were owners and occupiers of premises. It does not afford a proximately caused by the breach of that duty. The legal 4 defense to contractors or property managers who create a status of a person injured on real property determines the dangerous condition or fail to remedy a hazard on the scope and extent of the owner’s duty to the injured person. 5 property.13 The open and obvious doctrine does not Generally, a property owner owes an invitee a duty of abrogate a landlord’s statutory duty to keep leased premises ordinary care to maintain the premises in a reasonably safe in a fit and habitable condition.14 condition and to warn of hidden defects and dangers.6 But, the open and obvious doctrine obviates the duty to warn and In the past couple of years, the Supreme Court has been acts as a complete bar to any negligence claims. When 7 asked to abolish the open and obvious doctrine when the applicable, the open and obvious doctrine provides that the hazardous condition amounts to a violation of an owner of a premises owes no duty to persons entering the administrative rule or regulation. The first couple of cases to premises regarding those dangers that are open and reach the Supreme Court on this issue were never decided obvious. 8 CONTINUED 13 being dismissed as having been improvidently allowed dangerous and that the landowner breached its duty of care, because of deficiencies in the record. 15 Which brings us to “the violation is mere evidence of negligence, and does not Lang v. Holly Hill Motel. raise an irrebuttable presumption of it. As is the case with all other methods of proving negligence, the defendant may In Lang, the Supreme Court held that when an invitee on a challenge the plaintiff’s case with applicable defenses, such defendant’s property is injured by a hazardous condition that as the open-and-obvious doctrine. The plaintiff can avoid constitutes a violation of the Ohio Basic Building Code, the such defenses only with a per se finding of negligence, which property owner may assert that the hazardous condition was we declined to extend to this context in Chambers.”18 The open and obvious, and that the owner therefore had no legal Court left open the possibility that there could be duty to warn or protect the invitee against it. Albert Lang, circumstances in which a dangerous condition created by a who suffered from emphysema and carried a portable Building Code violation is not open and obvious.19 The oxygen tank, fell while his wife was helping him ascend a Court noted that property owners who violate the building two-step stairway in front of the couple’s motel room. As a code still face statutory penalties, including injunctions, result of his fall, Mr. Lang suffered a broken hip that required fines, and criminal sanctions, that serve as disincentives for his hospitalization. He died three months later from failing to maintain their property in compliance with the complications that doctors attributed to his fall. The building codes.20 complaint and supporting expert testimony asserted that Mr. Lang’s fall was caused by the risers of the two steps being Another case is pending and active before the Supreme several inches higher than the maximum permitted by the Court which will address issues also relating to the open and Ohio Basic Building Code, and the absence of a handrail, obvious defense: Stewart v. Lake Cty. Historical Soc.,21 Case also required by the building code. There was no dispute No. 2006-2029. In Stewart, the Supreme Court of Ohio will that the steps and lack of a handrail were open and obvious be deciding whether guidelines adopted in accordance with to the Langs. the Americans with Disabilities Act trumps the open and obvious doctrine and, if so, whether a non-disabled person The trial court granted summary judgment to the defendant has standing to argue that a ramp on the property that is not motel on the grounds that the height of the steps and ADA compliant is an unreasonably hazardous condition that absence of a handrail were open and obvious conditions, caused her to slip and fall. The plaintiff in Stewart presented and thus the motel had no duty to protect or warn its guests an opinion from a consultant establishing that the about those conditions. The court of appeals agreed and wheelchair ramp exceeded the maximum slope allowed by affirmed the trial court’s summary judgment. But, ADA regulations. In reversing the trial court’s summary recognizing that its decision was in conflict with two other judgment in favor of the Historical Society, the appellate appellate courts in Ohio, it certified the case to the Supreme court found that even though the plaintiff did not qualify as Court to resolve the inter-district conflict. disabled under the ADA, the ramp’s failure to comply with ADA standards could be considered as evidence of Affirming the courts below and upholding the continued negligence. Briefing in Stewart, which had been stayed viability of the open and obvious defense, the Supreme pending a decision on Lang, has now resumed and oral Court distinguished between its prior case law that held argument should take place later this year.22 violations of statutory duties amounts to negligence per se (precluding the open and obvious defense)16 and With the aging population of baby-boomers, slip/trip and fall administrative rules, like the Ohio Basic Building Code, that claims are predicted to increase in volume in the coming do not amount to negligence per se. 17 In making this years. Maintaining the continued viability and consistent distinction, the Supreme Court declared that while a building application by courts of the open and obvious doctrine is of code violation may provide evidence that a condition was great importance to the successful defense of many premises liability cases. The Supreme Court of Ohio’s recent Summer 2009 OACTA Quarterly Review 14 decision in Lang may have closed one loophole in the open and obvious doctrine, but the plaintiff’s bar still has the open Tim Fitzgerald is a partner with the law firm of and obvious doctrine in the cross-hairs and efforts to avoid Gallagher Sharp where he is in charge of the firm’s or minimize its definitive result can be expected. Stay Appellate Practice Group. His practice is devoted to tuned. appellate advocacy, commercial litigation and the defense of professional liability and personal injury actions and litigation involving insurance carriers. Mr. Fitzgerald is certified as an Appellate Law Specialist Endnotes by the Ohio State Bar Association with substantial 1 The most commonly invoked exception to the open and obvious doctrine arises when there are “attendant circumstances” that may experience handling appellate cases at all levels of distract the plaintiff’s attention or interfere with the plaintiff’s Ohio’s state and federal courts. Mr. Fitzgerald has ability to detect and appreciate the danger of the condition. Herbst v. Kroger Co., 6th Dist. No. L-08-1413, 2009-Ohio-2767, at ¶9; Frano successfully argued several cases before the Ohio v. Red Robin Internatl., Inc., 11th Dist. No. 2008-L-124, 2009-Ohio- 685, at ¶22. Supreme Court and he has authored a number of 2 Armstrong v. Best Buy Co., Inc., 99 Ohio St.3d 79, 2003-Ohio-2573, amicus briefs on behalf of OACTA in the Ohio syllabus. 3 Slip Opinion No. 2009-Ohio-2495. Supreme Court, including Lang v. Holly Hill Motel. He 4 Chambers v. St. Mary’s School, 82 Ohio St.3d 563, 565, 1998-Ohio- 184; Texler v. D.O. Summers Cleaners & Shirt Laundry Co., 81 is also counsel of record for the Lake County Ohio St.3d 677, 680, 1998-Ohio-602. Historical Society in the Supreme Court case of 5 Gladon v. Greater Cleveland Regional Transit Auth., 75 Ohio St.3d 312, 315, 1996-Ohio-137. Stewart v. Lake Cty. Historical Soc. which is discussed 6 Paschal v. Rite Aid Pharmacy, Inc. (1985), 18 Ohio St.3d 203. 7 Armstrong, at ¶5. in this article. 8 Armstrong, at ¶13. 9 Sidle v. Humphrey (1968), 13 Ohio St.2d 45, paragraph one of the syllabus. In addition to being a member of OACTA, Mr. 10 Armstrong, at ¶ 5, quoting Simmers v. Bentley Constr. Co., 64 Ohio St.3d 642, 644, 1992-Ohio-42. Fitzgerald is a member of a number of other 11 Armstrong. professional associations including the American, 12 Simmers, 64 Ohio St.3d at 644, footnote 2; Armstrong, at ¶ 12-13. 13 Simmers; see also, Nageotte v. Cafaro Co., 160 Ohio App.3d 702, Ohio State, and Cleveland Metropolitan Bar 2005-Ohio-2098 (applying Simmers to company responsible for managing property and maintaining parking lot). Associations, and DRI. He is a member of the Ohio 14 Robinson v. Bates, 112 Ohio St.3d 17, 2006-Ohio-6362, ¶20-25. State Bar Association’s Appellate Law Specialty 15 Ahmad v. AK Steel Corp., 12th Dist. No. CA2006-04-089, 2006-Ohio- 7031, discr. appeal dismissed as improvidently allowed, 119 Ohio Board, a Fellow in the Litigation Counsel of America, St.3d 1210, 2008-Ohio-4082; Uddin v. Embassy Suites Hotel, 165 Ohio App.3d, 2005-Ohio-6613, discr. appeal dismissed as a Life Member of the Judicial Conference of the improvidently allowed, 113 Ohio St.3d 1249, 2007-Ohio-1791. Eighth Judicial District, and a Barrister in the William 16 Robinson, ¶24-25. 17 Chambers v. St. Mary’s School, 82 Ohio St.3d 563, 1998-Ohio-184. K. Thomas American Inns of Court. Mr. Fitzgerald 18 Lang, at ¶21. 19 Id., at ¶22 (“This decision applies only to those cases in which an received his undergraduate B.S. degree from alleged Building Code violation creates an alleged danger that is Marquette University and his J.D. degree from allegedly open and obvious to the plaintiff.”) 20 Id., at ¶23. Cleveland-Marshall College of Law. 21 169 Ohio App.3d 1, 2006-Ohio-4822, discr. appeal allowed, 112 Ohio St.3d 1469, 2007-Ohio-388. 22 Another case, Kirchner v. Shooters on the Water, Inc., 167 Ohio App.3d 708, 2006-Ohio-3583, discr. appeal allowed and stayed, 113 Ohio St.3d 1487, 2007-Ohio-1986, appeal stayed, 119 Ohio St.3d 1425, 2008-Ohio-4170, remains pending before the Supreme Court too but the stay on briefing pending a decision in Lang has not been lifted by the Court in Kirchner. 15 Online Social Networking Sites – A New Tool for Litigators? Mary S. Peterson Associate Counsel of the Cincinnati Insurance Company Will you be my friend? Can I follow you? background, employment, marriage and dating status, Saying “yes” to these simple questions hobbies, and interests.7 Additionally, most sites often allow could have dramatic ramifications on users to post multimedia such as pictures, videos, and links your litigation. Social Networking Sites to favorite websites. Many social networking sites allow the [hereinafter SNS] MySpace.com, user to post a string of messages to and from other users. Facebook.com, Cyworld.com, Bebo.com Other SNS applications, such as Twitter.com allows users to and Twitter.com are easy sources of post their current moods or daily plans for their “followers” to valuable information for litigators. For better or for worse, read. Each SNS has a differing degree of visibility, which can opponents, clients and witnesses may post information, be further limited by the user.8 sometimes on a minute-by-minute basis (as with Twitter), that is material and probative to lawsuits. Discovery through Common Lingo SNS is cheap and quick, and may yield huge dividends. Upon opening an account the SNS asks users to identify Therefore, identifying and reviewing a clients, an adversary’s acquaintances who share profiles on the website. The term or even a juror’s SNS page may quickly become a matter of “friend” means someone who the user grants access to due diligence for all litigators. 1 his/her SNS.9 “Friends” can include anyone: your college roommate, next-door neighbor, boss, a childhood friend or What are Online Social Networking Sites? even a stranger.10 A “friend request” is notification that someone wants access to your page.11 The creator of the Online SNS generally consist of three elements: (1) an page can grant or deny this request (“friend individual creates an online profile within a system, (2) each confirmation”) and has the option to remove the “friend” at user has a list of other online users with whom they share a later time.12 Once given “friend” status, the “friends” can some connection, and (3) online user views their list of access each other’s profile to observe and post messages on connections and those made by other users. By and large, 2 the page. most social networking sites are used to communicate to known acquaintances instead of meeting strangers.3 Some Each SNS user will have a list of “friends” that is publicly sites, however, cater toward meeting new people with like displayed. By searching a user’s “friend” list, other users can interests. An aspect peculiar to social networking is the 4 locate mutual acquaintances and become their “friend”, as degree of personal expression that many users post on their well. Seeing a user’s “friend” list provides a valuable insight profile. Posted titillating tales, provocative photos, and 5 into the user’s personality. Many sites allow “friends” to post vagarious videos can provide a treasure trove of information public messages on the profile. The “wall” is the space on for any litigator. the user’s profile page where “friends” can post messages for the user and everyone else who has access to the page.13 When creating a user profile, the social networking website The level of visibility of a user’s profile varies by design, and will give the user a series of questions for personal the user’s choice of display settings. If the page is public, the information to make available on his or her profile. These 6 information contained therein is available for anyone to view questions ask for information such as the user’s age, and download. location, religious and political affiliations, educational Summer 2009 OACTA Quarterly Review 16 Facebook users, up an amazing 752%.35 Twitter is a free SNS and The most popular SNS is currently Facebook with nearly 1.2 micro-blogging service that enables its users to send and billion visits as of January 2009. 14 The general public can read other “tweeters” (Twitter.com users) updates known as see a glimpse of a user’s home page but will not be tweets. 36 “Tweets” are limited to 140 text characters permitted to post anything on the site. While Facebook displayed on the user’s profile page.37 The “tweets” are then initially started as a SNS for a few Ivy League schools, it has delivered to Twitter “followers,” or other Twitter users who expanded to anyone with a valid email address. 15 Facebook have subscribed to receive the “tweets.”38 Senders have the is especially popular among college students.16 Yet, in 2009, option to choose who receives their “tweets” or can, by membership by users 35-54 grew at 276.4%, 55 years and default, allow anybody to access them.39 older grew by 194%.17 The 25-34 year old demographic doubles every six months.18 Ethical Considerations Facebook has very similar features to My Space but is more Ohio Rules for Professional Conduct prohibits the use of real- restrictive and it allows users to view other profiles within the time electronic contact with a prospective client.40 same networks.19 Facebook networks are comprised by Additionally, the Model Rules of Professional Conduct region, city, school, and company. 20 Users have the option to prohibit a lawyer from communicating with an adverse party’s further restrict their profile’s display to “friends” only. To 21 client without the consent of the opposing counsel.41 In most become a Facebook “friend,” one user must request the cases, a litigator browsing an opposing client’s SNS can do so other to add him as a “friend.” 22 Once “friends”, the users without violating Model Rule 4.2, as long as the information have mutual access to each other’s profile. 23 is in the public domain. But, does a “friend request” by a lawyer constitute a “communication” under the Model MySpace Rules? While there have not been any Ohio cases that dealt My Space is the second most popular SNS in the United specifically with this question, there are a few cases to States. 24 As of March 2009, My Space had over 124 million suggest that a “friend request” is most likely an improper unique active users. 25 It was started in 2003 to compete communication. 42 with the then-popular social networking site, Friendster.26 My Space initially attracted independent rock bands and Uses of SNS their fans for its self-promotion capabilities. Eventually, 27 teenagers and young adults became avid users.28 The practical use of information from SNS in the litigation is My Space has all the features of a popular SNS. However, relatively new, and supporting case law has yet to catch up My Space offered its users a broader ability to design their although certainly, basic evidentiary rules apply. A Maryland pages. 29 Each My Space profile is a blank canvas for its user federal court recently determined electronically stored to create any way they desire. 30 The user profile contains a information could be used in trial if the data is: (1) relevant, list of the user’s friends and a search tool to find other (2) authentic, (3) not hearsay or admissible under an users.31 My Space does not limit viewing profiles by exception to rules barring hearsay evidence, (4) original or networks; rather, it is the user’s decision to restrict his/her duplicate, or admissible as secondary evidence to prove its profile from public display. 32 If the profile is limited from contents, and (5) probative value must outweigh its public view, another My Space user must request permission prejudicial effect. 43 As the use of SNS information to view the profile. 33 increases, expect to see more case law and perhaps a modification of evidence rules clarifying the practical Twitter considerations in admitting electronic information. Twitter is the third most popular and quickest rising SNS. 34 As of December 2008, Twitter reported 4.43 million unique CONTINUED 17 SNS can be use to obtain a wide variety of information about Conclusion potential witnesses, opposing parties or even jurors. The contents of a person’s SNS page, blog or tweet give a unique If you have not used SNS as part of your regular litigation insight into a person’s life, thoughts, prejudices and opinions. investigation, I highly recommend you start. There is a Information contained on a person’s site has been used in tremendous amount of personally published, public multiple ways in litigation. In California, at the sentencing information on the web waiting for discovery. Google your hearing for a 22-year-old defendant convicted of driving Plaintiff. Search Facebook for a witness. Check to see if your under the influence and vehicular manslaughter, My Space jurors Twitter. Surf the web. You will be very surprised and photos of the defendant partying and drinking with friends pleased with the information you discover. were used by the prosecution to show the defendant’s lack of remorse.44 Despite pleas for leniency from the victim’s I would like to thank recent Akron University Law School Graduate family and the Probation Department, the Judge sentenced Earle Noel for his invaluable assistance in providing the research the Defendant to five years and four months in prison. 45 for this article. In Pennsylvania, during a recent Federal corruption trial, the Judge threatened a mistrial after it was discovered a juror posted updates on the case on Twitter and Facebook. 46 Endnotes During the trial, the juror made multiple posts including one 1 Due Diligence with Social Networks, Thompson, Tamara, December 12, 2008, Law.com, http://www.law.com/jsp/legaltechnology/ that declared “Stay tuned for a big announcement on pubArticleLT.jsp?id=1202426678705 2 Social Network Sites: Definition, History, And Scholarship, Boyd, D. Monday everyone!”47 The Judge permitted deliberations to M., and Ellison, N. B. (2007), Journal of Computer-Mediated go forward convicting the defendant, however the defense Communication, 13 (1), article 11, http://jcmc.indiana.edu/vol13/issue1/boyd.ellison.html plans an appeal using the juror’s posts as grounds for 3 Id. 4 Id. reversal.48 Additionally, in Pennsylvania a potential seven- 5 Id. figure settlement was drastically effected after SNS photos of 6 Id. 7 Id. the plaintiff were used to contradict her sworn testimony 8 Id. 9 Can Facebook Be Your Friend? Real Simple, April 2009, 160. about her quality of life after the accident. 49 Photos of the 10 Id. Plaintiff looking toned and tanned, partying with her 11 Id. 12 Id. girlfriends and drinking in her halo brace effectively reduced 13 Id. 14 Top Twenty Five Social Networking Sites - Feb 2009, February 17, plaintiff’s settlement demand. 50 2009, http://social-media-optimization.com/2009/02/top-twenty-five- social-networking-sites-feb-2009/ 15 Id. In New Jersey, a Judge ordered plaintiffs to provide the 16 Id. 17 2009 Facebook Demographics And Stastics Report 276% Growth In defense with the contents of their e-mails and SNS postings 35-54 Users, Peter Corbett, January 5, 2009 as the court determined the requested electronic information http://www.istrategylabs.com/2009-facebook-demographics-and- statistics-report-276-growth-in-35-54-year-old-users/ would have a significant impact on understanding the 18 Id. 19 http://en.wikipedia.org/wiki/Facebook plaintiffs’ anorexia and bulimia and help determine the 20 Id. defendant insurance company’s responsibility for payment of 21 Id. 22 Id. the plaintiffs’ medical expenses.51 Finally, in Cincinnati, a 23 Id. 24 Top Twenty Five Social Networking Sites - Feb 2009, February 17, juror was removed from a panel after plaintiff’s counsel 2009, http://social-media-optimization.com/2009/02/top-twenty-five- discovered the following Facebook post: “Barry Price is social-networking-sites-feb-2009/ 25 My Space Shrinks As Facebook, Twitter And Bebo Grab Its Users, sitting in hell. . . aka jury duty.”52 These are just a few David Smith, March 29, 2009, http://www.guardian.co.uk/technology/ 2009/mar/29/myspace-facebook-bebo-twitter examples of the unlimited potential uses for information 26 My Space, Your Space, or Our Space? New Frontiers in Electronic contained on SNS. Evidence, John S. Wilson, Oregon Law Review, Vol. 86, 1201, 1222 (2008). 27 Id. 28 Id. Summer 2009 OACTA Quarterly Review 18 29 History of My Space, A. Cottrell, http://music.lovetoknow.com/ History_of_Myspace 30 “A Place for Friends” A History of My Space, August 14, 2008, Mary S. Peterson is Associate Counsel of the http://www.randomhistory.com/2008/08/14_myspace.html 31 How My Space Works, Julia and Patrick Brothers, Cincinnati Insurance Company. Mrs. Peterson has http: computer.howstuffworks.com/myspace.htm 32 Id. worked in the Legal Department, Trial Division since 33 How to Block My Space Users, http://www.dummies.com/how-to/ 1991, serving as Staff Counsel and Managing content/how-to-block-myspace-users.html 34 Id. Attorney of the Columbus Law Office. She is 35 Twitter’s Massive 2008: 752 Percent Growth, Adam Ostrow, January , currently the Managing Attorney of the Akron, Ohio 9, 2009 http://blog.compete.com/2009/02/09/facebook-myspace- twitter-social-network/ Law Office and serves as Chairman of the Law 36 Twitter, http://en.wikipedia.org/wiki/Twitter 37 Id. Offices Technology Committee. Prior to working for 38 Id. The Cincinnati Insurance Company, Mrs. Peterson 39 Id. 40 Ohio Rules of Professional Conductm, Rule 7.3. was an Assistant Attorney General for the Court of 41 Ohio Rules of Professional Conduct, Rule 4.2 “In representing a client, a lawyer shall not communicate about the subject of the Claim Defense Section of the Ohio Attorney representation with a person the lawyer knows to be represented by General’s Office and worked for a private defense another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized to do so by law or a court order.” law firm. She devotes her practice to general civil 42 See People v. Fernino (2008), 19 Misc.3d 290, 851 N.Y.S.2d 339. 43 Lorraine v. Markel American Ins. Co., 241 F.R.D. 534, (D.Md. litigation with an emphasis on complex torts. May 04, 2007) (NO. CIV.A.PWG 06 1893) 44 Court Case decision reveals Dangers of Networking Sites, Evan Wagstaff, Daily Nexus, February 28, 2007 http//www.dailynexus.com/ Mrs. Peterson is a 1983 graduate of Bowling Green article.php?a=13440 45 Id. State University receiving a Bachelor of Science 46 As Jurors Turn to Web, Mistrials Are Popping Up, John Schwartz, degree in History and English Education. She is a March 17, 2009 http://www.nytimes.com/2009/03/18/us/ 18juries.html?_r=1 1987 graduate of the University Of Toledo College Of 47 Id. 48 Id. Law where she served as Vice Chairman of the Moot 49 The Danger of Self-Inflicted Damage on the Web, Court Board. Mrs. Peterson is a member of the Ohio Don P. Palermo, Pennsylvania Lawyer, November-December 2008. 50 Id. State Bar Association, The Akron Bar Association 51 Is Facebook Your “Permanent Record?, Sarah Perez February 4, and the Ohio Association of Civil Trial Attorneys. 2008, http://www.readwriteweb.com/archives/ is_facebook_your_permanent_rec.php 52 Juror Booted for ‘Sitting in Hell’ Facebook Post, Cincinnati Enquirer, January 31, 2009, http://www.newser.com/story/49554/juror-booted- Mrs. Peterson currently lives in northeastern Ohio for-sitting-in-hell-facebook-post.html with her husband John and their two teenage daughters. When not working, Mrs. Peterson enjoys the outdoors, gardening, biking and spending time with her family. 19 Are Tort Claimants Necessary Parties to Insurance Coverage Dec Actions? Shawn M. Blatt Freund, Freeze & Arnold Whenever an insurer decides to litigate persons who have or claim any interest that would be coverage through a declaratory judgment affected by the declaration. The Broz court noted that it had action, it must decide whom to include previously ruled that tort “claimants” had standing to assert as a party to the lawsuit. Certainly, the declaratory judgment actions against the tortfeasor’s insurer policyholder, and any other insured before obtaining a judgment against the insured. Because should be included. It is not so clear as the tort claimant had an interest in the action and was not to whether a tort claimant, i.e., included in the original coverage case, it could have no “potential” judgment creditor, should be included. The Ohio effect on the tort claimant’s rights to seek coverage under Supreme Court is now considering the issue in Estate of the policy. Heintzelman v. Air Experts, Inc., Case No. 08-2173 (120 Ohio St.3d 1524 901 NE2d 244, (appealed from Estate of 1999 Amendments in H.B. 58 Heintzelman v. Air Experts, Inc., (Ohio App.5th Dist 2008), In 1999, the Ohio General Assembly passed H.B. 58, which 2008 – Ohio – 4883. amended several statutes in an attempt to supersede the Tort Claimants Were Necessary Parties Broz decision as well as other decisions giving the tort claimant rights to challenge coverage before judgment. The Originally, tort claimants had to be included as parties, or the new section of Ohio Revised Code § 2721.02(B) was decision in the dec action would have no preclusive effect enacted to prohibit direct actions by claimants against the on any later claim for coverage by a judgment creditor. See tortfeasor’s insurer until the claimant obtains the final Broz v. Winland (1994), 68 Ohio St.3d 521, 629 N.E.2d judgment against the tortfeasor: 395. In Broz, the insurer obtained a judgment declaring it had no duty to defend or indemnify its insureds for the A plaintiff who is not insured under a particular claims of the tort claimant. The insurer did not include the policy of liability insurance may not commence tort claimants as parties. Later, after judgment was against the insurer that issued the policy an action obtained, the judgment creditor sued to recover on the or proceeding under this chapter that seeks a policy. The Supreme Court held that the tort claimant (now declaratory judgment or decree as to whether the judgment creditor) was not bound by the previous decision policy coverage provisions extend to an injury, death on coverage: or loss to a person or property that a particular insured under the policy allegedly tortiously caused A determination made in a declaratory judgment the plaintiff to sustain . . . until a court of record action between an insurance company and its enters, in a distinct civil action for damages insured does not bind persons injured by the between the plaintiff and that insured . . . a final insured’s negligence who are not parties to the judgment awarding the plaintiff damages. declaratory judgment action. Ohio Revised Code § 2721.02(B). Broz, 68 Ohio St.3d, 521, syllabus. Division (B) of R.C. 2721.12 was enacted to make dec The Supreme Court in Broz relied upon then existing actions between an insurer and insured binding on third language in R.C. 2721.02 that required the joinder of parties: Summer 2009 OACTA Quarterly Review 20 (B) A declaratory judgment or decree that a omitted); Broz v. Winland (citations omitted); and court enters in an action or proceeding Mezerkor v. Mezerkor (citations omitted). under this chapter between an insurer and a holder of a policy of liability insurance issued by the insurer and that 1999 H.B. 58 § 4, eff. 9-24-99. resolves an issue as to whether the policy’s coverage The Legislature also declared its intent that the provisions extend to an injury, death or loss to person or amendments to 2721.02 were to supersede Broz v. property that an insured under the policy allegedly tortiously Winland to make any judgment in a dec action binding on caused shall be deemed to have the binding legal third parties, even those who are not parties: effect described in division (C)(2) of section 3929.06 of the Revised Code and to also have binding legal The General Assembly declares that in enacting new effect upon any person who seeks coverage as an division (C) of 2721.02, new division (B) of section assignee of the insured’s rights under the policy in 2721.12, and division (C) of the new section relation to the injury, death or loss involved. 3929.06 of the Revised Code . . . it is the intent of the General Assembly to supersede the effect of the Ohio Revised Code § 3929.06(C)(2), relating to holding of the Ohio Supreme Court in Broz v. supplemental complaints arising on behalf of judgment Winland (1994), 68 Ohio St.3d 521, and its creditors, was passed with the following language: progeny relative to the lack of binding legal effect of (2) If prior to the judgment creditor’s a judgment or decree upon certain persons who commencement of the civil action against were not parties to a declaratory judgment action or the insurer, the holder of the policy proceeding between the holder of a policy of liability commences a declaratory judgment under insurance and the insurer who issued the policy. Chapter 2721 of the Revised Code against 1999 H.B. 58 § 5, eff. 9-24-99. the insurer for a determination as to whether the policy’s coverage provisions The intent of the Legislature appeared clear: tort claimants extend to the injury, death or loss to who had not obtained a final judgment could not initiate a persons or property underlying the dec action disputing coverage and would be subject to a judgment creditor’s judgment and if the declaratory judgment between an insurer and the holder of a court involved in that action or proceeding policy, regardless of whether the claimant was a party to the enters final judgment with respect to the case. Despite these changes, courts are still refusing to policy’s coverage or non-coverage of that apply the preclusive effects of a dec action if the tort injury, death or loss, that final judgment claimant was not a party. shall be deemed to have binding legal effect upon the judgment creditor . . . Development of Law after 1999 Amendments Finally, the General Assembly stated its intent to supersede One of the earliest cases interpreting the amended statute Broz with the passing of H.B. 58, as follows: was Cincinnati Ins. Co. v. Consolidated Equip. Co. (C.A. Montgomery Cty., 2nd Dist. 2003), 2003-Ohio-47. In The General Assembly declares that in enacting Consolidated, damages occurred when a Consolidated divisions (A) and (B) of new section 3929.06 and employee was servicing an oil burner on an oven located at new division (B) of Section 2721.02 . . ., it is the Nickles Bakery. Nickles was insured by USF&G, who paid intent of the General Assembly to supersede the significant money for damage to the oven. Nickles also effect of the holding of the Ohio Supreme Court in incurred additional uninsured losses. Krejci v. Prudential Prop. & Cas. Ins. Co. (citations CONTINUED 21 The insurer filed a declaratory judgment against its insured, action. Indiana Ins. Co. v. Murphy (2006), 165 Ohio App.3d Consolidated and did not include any claimants (Nickles or 812, 848 N.E.2d 889. In Murphy, a tort claimant sought to USF&G). Consolidated then filed a third-party complaint intervene in a declaratory judgment action between an including Nickles and USF&G in the complaint as third-party insurer and its insured that was set to decide coverage defendants in the dec action. The insurer filed a motion to issues for the underlying litigation. The Court of Appeals for dismiss Nickles and USF&G as improper parties on the the Third District held that the tort claimant’s interests were grounds that, as tort “claimants,” they had no interest in the sufficient to mandate intervention and that the preclusive coverage. The trial court granted the motion to dismiss, effects of the 1999 amendments would impair the tort finding that USF&G and Nickles did not have any interest in claimant’s rights in its absence, thereby necessitating the proceeding based on the ’99 amendments. intervention. The court followed the decision in Consolidated Equipment, noting that although the 1999 In reviewing the statutes and the changes made, the Second amendments were intended to supersede the effects of District Court of Appeals held that Ohio Revised Code § Broz and Krejci and thereby prohibited a tort claimant from 2721.02(B) clearly bars a direct action on behalf of a tort commencing a declaratory judgment action, nothing in the claimant against an insurer but does not prevent a tort amendments barred the tort claimant from participating or claimant from being included as a party in the proceeding. intervening in a pending action. Id. at 823. It read the term The court was reluctant to bar parties who clearly had an “commenced” very narrowly, finding that intervention by the interest in the outcome of the case, thereby binding them to tort claimant was allowed. the results of the dec action without ever being heard. The court expressed its reservations with the 1999 The United States District Court for the Northern District of amendments to the Declaratory Judgment Act and R.C. § Ohio, in Medical Assurance Co., Inc. v. Martinez, 2008 W.L. 3929.06: 2227345 (N.D. Ohio 2008), also adopted the analysis that the 1999 amendments, while prohibiting tort claimants In our opinion, it is logically inconsistent to say on from “commencing” actions, did not prohibit tort claimants one hand that a party does not have an interest in a from “intervening” in pending actions. proceeding such that he is a proper and necessary party and to claim on the other that he is bound by a Recently, the Federal District Court for the Northern District judgment in the same proceeding because his of Ohio and the Fifth District Court of Appeals have held that interest is sufficiently strong. Yet this is the tort claimants are again necessary parties to any tort action conundrum created by the 1999 amendments to filed by an insurer. In Polyone Corp. v. National Union Fire the Declaratory Judgment Act and to R.C. 3929.06. Ins. Co. of Pittsburgh (2008 N.D. Ohio), 2008 W.L. 4592927, Polyone, the insured, filed a dec action seeking Id. at 52. coverage under an insurance policy and naming several parties, including the tort claimant, as defendants. The At least one federal court reviewing the 1999 amendments insurer sought to remove the case to federal court, claiming to the declaratory judgment statutes has also questioned that the tort claimant’s consent was not necessary because the constitutionality of the language and the application of the tort claimant was an improper party to the dec action. res judicata to a tort claimant who never had an opportunity The district court held that, in fact, the tort claimant was a to defend its interests in court. See Harnish v. Safe Auto Ins. necessary party and that its inclusion in the case was Co. (E.D. Ky. 2005), 2005 W.L. 1868785. actually required by statute and case law. A number of courts have noted that the preclusive effect of The court noted that the 1999 amendments to the the 1999 amendments’ actually implicates the tort declaratory judgment statute and 3929.06 must be read in claimant’s interests, thereby mandating that a tort claimant pari materiae and held that, while a tort claimant cannot be allowed to intervene in a pending declaratory judgment Summer 2009 OACTA Quarterly Review 22 “commence” an action for declaratory judgment until it policy. Any determination between an insurer and insured obtains a judgment against the tortfeasor, an action would have no preclusive effect on a tort claimant who later commenced by the policyholder must add the tort claimant obtained a judgment and filed a supplemental complaint to to the action as a necessary party. Id. at 5. be paid under the policy. In 1999, the intent of the General Assembly was to supersede Broz by making any In so holding, the court relied upon the decision in determination between an insurer and an insured relating to Heintzelman v. Air Experts, Inc. (Ohio App. Delaware Cty., 5th coverage for a particular claim binding on all parties, App. Dist. 2008), 2008-Ohio-4883, a decision that has now including tort claimants. While the intent appeared clear, been accepted for review by the Ohio Supreme Court. In the effect of that intent was perhaps never fully considered. Heintzelman, the 5th district held that the ’99 amendments When courts were confronted with the prospect of denying only made a previous judgment in a dec action between an coverage to a tort claimant without any notice or opportunity insurer and its insured binding if the policyholder was the to be heard the result was predictable: the statute was one who commenced the suit against the insurer. narrowly interpreted to preserve the tort claimant’s rights. The changes apparently did not supersede Broz, because Going Full Circle that case would still be decided the same way, under the The intent behind the ’99 amendments seemed clear: to approach that has developed since the ’99 amendments. supersede the effect of Broz by ensuring that tort claimants Ohio Supreme Court Accepts Heintzelman who had not litigated a case to final judgment had no standing to challenge coverage under any applicable The Ohio Supreme Court has now accepted the question of insurance policy and binding those tort claimants to any whether a tort claimant is bound by a dec action between an judgment in a dec action between an insurer and its insured. insured and the insurer. In the case Estate of Heintzelman v. The 1999 amendments attempted to instill finality to dec Air Experts, Inc., Case No. 08-2173, the insurer undertook actions between insureds and their insurers so that later the defense of its insured but reserved the right to deny judgments rendered against the insured could not reopen coverage. Later, the insurer filed a declaratory judgment the issue of coverage. action seeking a declaration of no coverage or duty to defend and named its insured as the sole defendant. The The attempt to ensure finality on coverage disputes between insured failed to answer the dec action, and the trial court insureds and their insurers conflicts with the concerns that a granted default judgment against the insured, finding that tort claimant (especially those tort claimants who have the insurer had no duty to defend or indemnify its insured for strong valid claims that will likely result in a judgment) will the underlying lawsuit. Eventually, the underlying lawsuit lose coverage under a policy without having the opportunity was taken to verdict, and a verdict was awarded in the to be heard on the coverage issue. This conflict has resulted amount of $2,650,000. in a very narrow reading of the amendments, such that tort claimants are now being allowed to intervene into pending Thereafter, the judgment creditor filed a supplemental declaratory judgment actions between insurers and their complaint against the insurer, seeking payment under the insureds and claimants are not subject to judgments in insurer’s policy. The insurer defended on the grounds of res previous dec actions unless the original dec action was judicata and collateral estoppel because of its judgment commenced by the policyholder. against the insured finding it had no duty to defend or indemnify the insured for the claims. It appears that we have now come full circle since the decision in Broz v. Winland. Originally, the Ohio Supreme The trial court held the original declaratory judgment Court held that tort claimants were, in fact, necessary prohibited the claims by the judgment creditor, but the court parties to dec actions filed by insurers against insureds of appeals rejected that argument and held that the relating to determinations of coverage under any applicable CONTINUED 23 judgment between the insurer and its insured was not interest of finality of judgments and judicial economy should binding on the judgment creditor. The Court of Appeals for be paramount. the 5 district stated: th Under the current state of the law, insurers should always In a declaratory judgment action involving a include any tort claimants as party defendants in any dec determination of coverage between an insurer and action seeking a declaration under a contract of insurance its insured, a final judgment in the declaratory that may provide coverage for some or all of the claims. judgment action will have binding legal effect on the While it appears that tort claimants were intended to be judgment creditor if the holder of the excluded, the development of the law since the 1999 insurance policy commences the action amendment indicates that any dec action commenced by an against its insurer before the judgment insurer will not prevent a judgment creditor from reopening creditor commences its action against the the issue of coverage. The only time a previous dec action insurer. may have preclusive effects against a tort claimant would be one initiated by the policyholder. Until the Ohio Supreme Id. at 9 (emphasis added). Because the insurer, and not the Court finally determines the issue, the safest approach for policy holder commenced the dec action, the judgment had any insurer when seeking to have coverage decided is to no preclusive effect on the supplemental complaint of the include all potential tort claimants and all interested parties judgment creditor. so that any judgment rendered will not subject to challenge. The Ohio Supreme Court has accepted the case for review and the matter is now being briefed. OACTA has submitted a brief on behalf of the appellant insurer, American Family Insurance Company. Shawn Blatt is a shareholder with the law firm of The Ohio Supreme Court is confronted with the question of Freund, Freeze & Arnold. He focuses his practice in whether the changes to the declaratory judgment statute civil litigation, and more specifically in the areas of altered the requirement that potential judgment creditors be insurance coverage, commercial litigation, included in the lawsuit. The Court will decide the competing construction law, lender liability, and professional interests at issue: the interests of the insurance company in liability of architects and engineers. He is a member finality and ensuring that a judgment between the insurer of the Ohio Association of Civil Trial Attorneys and and its insured controls all coverage disputes (as well as the has recently authored an amicus brief for OACTA on difficulty in identifying and serving all possible and potential the changes to the declaratory judgment statute in judgment creditors). These concerns of finality compete Ohio He is a member of the Defense Research with the idea that all parties should have a fair and full Institute, and is a member of the insurance law opportunity to litigate the claims or their insurance issues. committees of both organizations. He is the former chairman of the Judiciary Committee for the Dayton Some courts have held that no party should be denied Bar Association and is active in the Greene County coverage under a contract of insurance without having an Bar Association. opportunity to be heard in a court of law. However, that concern is less significant before a judgment ever exists. The law is clear that a judgment creditor has no right under a policy unless and until a judgment is obtained, thereby allowing a supplemental lawsuit. If a coverage decision is rendered before judgment is taken, the potential judgment creditor’s interest in coverage is merely a possibility, and the Summer 2009 OACTA Quarterly Review 24 Medical Lien Subrogation Update Patrick S. Corrigan Staff Counsel of the Cincinnati Insurance Company • Definition: Subrogation literally name rather than that of the policyholder in order to recover means “to stand in the shoes of amounts paid on behalf of its policyholder. When a another.” Subrogation as it applies to tortfeasor’s insurer receives notice of another insurer’s the right of a governmental entity to subrogation claim, it is required to recognize that claim. recover from an insurer or its insured is Notice requirements require a specific indication of governed by federal and state statutes. subrogation rights. See, Motorist Mut. Ins. Co. v. Yates The right of recovery, however, is an (1988) 44 Ohio Misc.2d 5 (Dayton Muni. Ct.). independent cause of action, irrespective of liability, which looks to the parties involved for recovery. • Statutory Subrogation Rights • Political Subdivision Immunity • Ohio’s Made Whole Doctrine: The made whole – Revised Code §2743.02(D) doctrine requires that when an insured does not prejudice The statutory language governing immunity of political an insurer’s rights to subrogation, the insurer is not entitled subdivisions allows that any recovery of the state shall be to seek reimbursement or a setoff from coverage limits until reduced by the aggregated insurance proceeds, disability full compensation has been provided to the insured. awards and other insured recovery obtained by the claimant. Likewise, the subrogation interest of the insurance company The principle precluding recovery against the state is set will not have priority where the policyholder receives less forth in the decision of Community Ins. Co. v. Ohio than a full recovery. A voluntary settlement by the insured Department of Transportation (2001), 92 Ohio St.3d 76. for less than the tortfeasor’s policy limits suggests full ODOT’s negligence allegedly caused injury to the claimant, compensation to the injured party. and the health insurer pursued the recovery of medical expenses because the claimant was barred from recovering In Northern Buckeye Education Counsel Group Health against the state under Revised Code Section 2743.02(d). Benefits Plan v. Lawson, 103 Ohio St.3d 188, 2004-Ohio- The recovery was barred, since the claimant received 4886 held that a policyholder’s right to recovery is no longer compensation from the insurance company for her medical given priority over the insurers right to reimbursements when expenses. A distinction arose in Heritage Ins. Co. v. Ohio the policy language clearly an unambiguously protects the Department of Transportation, 104 Ohio State 3d 513, insurer’s right of reimbursement. Likewise, under Revised 2004 Ohio-6766, where the court determined that Section Code §2744.05(b)(1), when a claimant receives benefits 2743.02(d) does not apply to a joint tortfeasor seeking for injuries under a policy of insurance, they are deducted indemnification and/or contribution from the state because from a judgment against a political subdivision. The amount the joint tortfeasor is not deemed a claimant within the of benefits are deducted irrespective of the claimant’s meaning of the statute. obligation to reimburse any other subrogated carrier. However, a claimant whose benefits have been deducted Political subdivisions are immune to subrogation claims from an award will not be fully compensated, and therefore pursuant to Revised Code §2744.05(b)(1). No insurance is not required to reimburse a subrogated claim for benefits company or other guarantor is entitled to subrogate against deducted from an award against a political subdivision. a political subdivision to satisfy amounts paid under its contract. Likewise, state universities and colleges are • The Insurer as the Real Party in Interest: A protected under Ohio Revised Code §3345.40(b)(2). subrogated insurance carrier is entitled to file suit in its own CONTINUED 25 – UM/UIM Claims – Revised Code §3937.18(e) respective County Departments of Human Services. Where there is payment under UM/UIM provisions of the Medicaid is a service offered to those deemed in need of policy, the insurer is entitled to the proceeds of a settlement state assistance. for judgment resulting from the exercise of the insured’s rights against the liable party. – Aid to Dependent Children: Same criteria as Medicaid. – Subrogation – Revised Code §3937.21 – Worker’s Compensation: Worker’s Compensation, also Where an insurer pays a claim to its insured and the known as Industrial Commission, has an automatic lien on payment is later determined to be the obligation of another any settlement. Ohio law requires that anyone who submits insurer, the claimant’s insurer shall be subrogated to the a Worker’s Compensation claim to advise the Ohio Bureau rights of its insured against the other insurer. of Worker’s Compensation or a self-insured employer of the identities of all third parties against whom the employee has In Brezovar v. Am. Family Ins. Co., 2009-Ohio-1710, The 9 th a right of recovery. The Worker’s Compensation “right of District Court of Appeals evaluated recovery language under subrogation” is automatic. The Administrator of the Bureau the American Family policy for medical expenses. In of Worker’s Compensation, a self-insuring employer, or an Brezovar, both parties involved were insured by American employee that contracts for the direct payment of medical Family. The tortfeasor’s policy paid the claim, but withheld services, is a “statutory subrogee” with the enforceable $2,000.00 of a $15,000.00 settlement for satisfaction of rights. In other words, use caution when determining who, is medical payments provided by American Family under its in fact, the subrogee in the settlement. insured’s policy. The claimant accepted the check in the amount of $15,000.00 and represented and agreed in the – U.S. Department of Labor: Under the federal labor laws, release that a lien of $2,000.00 was due and owing to including the various railroad and maritime laws, a right of American Family to satisfy a medical expense payment recovery exists as an independent cause of action. This will under the claimant’s own policy. The claimant then sought most frequently be seen when a U.S. Postal Service to avoid satisfaction of the $2000.00 lien. The court ruled employee asserts a claim against an insured, i.e. dog bites, that since the claim was settled within the limits of the slip & fall. When the employee makes a job related claim, policy owned by the tortfeasor, and no UIM coverage of the the federal government has the right to assert its lien. claimant applied, the claimant had no right to deny reimbursing the $2,000.00. – Social Security: The Federal Government, through the Department of Health and Human Services, Health Care • What government programs give rise to a right of Financing Administration, administers the Social Security recovery? Program. – Medicare: Under federal law, Medicare has a lien over • What is the duty of the parties in cases involving personal injury settlements and judgments for medical the above benefits? payments to claimant. This “super lien” does not have to be put in writing, and applies despite your lack of knowledge As a potentially liable party, an insurer is required to make a that Medicare has made payments. settlement which protects the superseding lien. In other words, all of the above programs now have a lien which – Medicaid: The State of Ohio, and its County circumvents a hold harmless agreement. Releases and Commissioners, administers the Medicaid program in Ohio indemnification agreements contain language designed to through the Ohio Department of Human Services, and the protect the interests of the insurer and insured. However, no signature guarantees that the plaintiff will protect an insured Summer 2009 OACTA Quarterly Review 26 or carrier from a subsequent claim by the lien holder. While Medicaid and Medicare entitlement status of all claimants. Medicare has a “super lien”, Medicaid’s rights are based on The penalty for noncompliance is $1,000.00 per day per notice. According to Revised Code Section, 5101.58, “the beneficiary. This applies to all settlements after July 1st of third party becomes liable to the Department of Job and 2009. Family Services as soon as the third party is notified in writing of the valid claims for recovery under this section.” – Triggering Event for Reporting Results • Medicare Recovery under MMSEA Section III. • Includes two steps for the responsible entity. – Step 1 requires the insurer or Under the law, no settlement, compromise, judgment or responsible entity to determine whether a other recovery in any action shall be final unless reasonable claimant is entitled to Medicare benefits. notice and opportunity to collect is provided to the – Step 2 stipulates that if the claimant is governmental entity responsible for recovery. The Centers entitled to benefits the information must for Medicare and Medicaid Services (CMS) collects data be submitted to the Secretary of Health from reporting entities to fulfill the reporting requirements and Human Services through the under Section III of the MMSEA. MMSEA is the Medicare, Coordination of Benefits Secure Website Medicaid and SCHIP Extension Act of 2007 (P.L. 110-173). (COBSW). This Act, authorized under 42 U.S.C. 1395 y(b)(7) & (8) governs all settlements. The extensive details and • A report must be made where there has been a requirements under the Act are found at www.cms.hhs.gov/ settlement or judgment award or other MandatoryInsRep/01_O.asp. The website provides payment where ongoing medical payments instructions on the implementation of the Act and warnings have been made. Two events are to be on what not to do. The details of the Act are summarized reported; (1) the initial records to reflect the below. RREs acknowledgement of responsibility and (2) a final report showing the termination of the – Responsible Reporting Entities (RREs) under the responsibility. Such a situation evolves where MMSEA a claim has been made, but no suit has been filed and the insurer agrees to pay for the The reporting entities under the revised Medicare guidelines medical bills of the claimant. The RRE is only are known as ‘responsible reporting entities.’ These entities required to report the obligation and does not include employer healthcare plans, self-insured entities, have to allocate indemnity in medical liability insurers and any other entity who assumes payments. If there is no settlement, judgment responsibility for medical payments for Medicare entitled or award, and the RRE intends to close the file, beneficiaries. There are mandatory reporting obligations there is no obligation to report. However, when the claimant is entitled to Medicare benefits. See, 42 where it is clear that payment responsibility U.S.C. §1395 y(b)8 (CMS-10265). may arise in the future, the RRE must report the claimant to CMS. Liability insurers and no-fault insurers have responsibility for reporting claims. “No-fault insurance” is insurance that pays – Reporting Thresholds under CMS for medical expenses for injuries sustained on the property or premises of the insured. Workers’ compensation plans For liability insurance, there is no minimum threshold for also have an obligation to report. Under the new guidelines, establishment ongoing responsibility for medical payments the insurer and self-insurers are required to determine the (ORM). For workers’ compensation, ongoing medical CONTINUED 27 responsibility, where the payment is for medical expenses physicians, insurers and individuals involved in a case, only, lost time of less than seven days where payment has , including state agencies entitled to payment by a third party been made directly to the medical provider or the payment provider. See, 42 C.F.R. §411.26 and U.S. v. Sosnowski does not exceed $600.00, there will be no requirement to 822 F.Supp. 570 (W.D. Wis. 1993). In Sosnowski, Medicare report through December 31 of 2010. st obtained a judgment against a plaintiff and his attorney who had neglected to reimburse Medicare from the settlement. – Practicalities of Identifying Medicare Eligibility Recovery may also be had against monies owed by the government, such as social security benefits. See, 20 C.F.R. Centers of Medicare Services has developed a Query Access §404.502 and 31 U.S.C. §3716. The entire Medicare System. This is found under the MMSEA website for statute is found at 42 U.S.C. §1395. Y(b) and the Responsible Reporting Entities. In order to determine regulations are located at 42 C.F.R. 411.20 at et seq. whether an individual is a beneficiary of Medicare, one is required to have the Social Security Number or health pair Counsel historically have relied on an apportionment of identification number, the first initial of the first name, the recovery proceeds. Now the Medicare lien will attach to the first six characters of the last name, the date of birth and entire recovery unless the Court “or other adjudicator of the gender. merits specifically designates amounts that are for payment of pain and suffering or other amounts not related to To determine Medicare eligibility, the insurer should Medicare services, Medicare will accept the Court’s ask the claimant to sign a Social Security form designation. Medicare does not seek recovery from portions identified as SSA-3288, which is a consent to of Court awards that are designated as payment for losses release information. This form may be submitted to other than medical services” See, Medicare Intermediary the local Social Security Office to request a Manual §3418.7 and Denekas v. Shalala, 943 F.Supp. complete benefit eligibility record. 1073 (S. D. Iowa 1996), citing Zinman v. Shalala 835 F.Supp. 1163, 1167 (N.D. California 1993), aff’d, 67 F.3d • Medicare has specific super lien status. 841 (9th Cir. 1995). The government is entitled to collect from the claimant and The Centers for Medicare and Medicaid Services maintains his attorney, the third party who caused the injury and all an operation known as “Medicare Coordination of Benefits”, heath care or prescription providers who benefited from the or COB. The COB office toll-free number from 8:00 a.m. to occurrence. However, the claimant is frequently not 8:00 p.m., Eastern Standard Time, is 1-800-999-1118. . collectable. The Medicare regulations state that “in the case Additional information may be found online at http:// of liability insurance settlements and disputed claims under www.cms.gov/medicare/cob. The COB that undertakes an employer group health plan or no-fault insurance, the insurance coverage archeology “to prevent mistaken following rule applies: If Medicare is not reimbursed as payment of Medicare benefits” can be accessed at http:// required by paragraph (h) of this section, the third party www.coms.hhs.gov/medicare/cob/factsheets. payer must reimburse Medicare even though it has already reimbursed the beneficiary or other party. So, the proper • As a practical matter, what should counsel do? governmental entity must either be a payee on the check or have provided written consent to the settlement. See, 42 – (1) Identify the Source of all Medical Payments. U.S.C. §1395. y(b)(2)(B). The penalty languages allows for Exercise caution in identifying self-insured doubling the amount owed to the agency. employers. Obtain policy information, with group numbers and claims processing addresses. In your The federal government requires all parties to protect discovery, determine whether the injured party is a Medicare, since Medicare is subrogated to all providers, recipient of any governmental aid. Explain to the Summer 2009 OACTA Quarterly Review 28 claimant that his or her privacy will be protected, – (4) Ask the Agency to Accept the Settlement and but that you are bound by law to notify the proper Proceed Directly with Claimant’s Counsel by agency of any possible liability and payment. Initial Obtaining a Written Waiver or Placing the correspondence with claimant’s counsel should Agency on the Check as a Payee. As a rule, make seek to clarify the identity of the lienholder. Most all arrangements in writing. The agencies are competent plaintiffs counsel are extremely usually willing to fax their assent and their demands frustrated with the lien issues, and will be happy to for settlement. ODHS will typically demand that they work with defense counsel and claims be placed on the check as a nominee. A smart professionals in resolving liens. plaintiff’s attorney will usually have negotiated a settlement with ODHS before negotiating with the – (2) Request a Release for Medical Records/ adjuster or defense counsel, but verification is Expenses. With Medicaid, a specific release for necessary. medical records is controlled and provided by the state, and it must be signed by the claimant, and • Steps to take and who to contact for Medicare: then forwarded to the health care provider which – For claims being settled due to liability insurance then produces a statement of medical expenses. coverage: The state should provide a “final bill”. o (1) Prepare a letter containing the following information: – The non-Medicaid release should specifically • (a) Name of Medicare recipient identify the governmental unit to whom authority is • (b) Medicare Number given. Informing the agency that there is a pending • (c) Date of Injury settlement should be deemed as a notice of intent • (d) Description of Injury to satisfy the lien. Although there is no statute of • (e) Medical Release Form limitations for the claim to be asserted by the (Statement signed by claimant government, reasonable notice of settlement is a allowing release of medical defense that can be asserted if it fails to identify its information to the insurance lien amount and later seeks reimbursement from company) the potentially collectible parties of insurers. o (2) Send to: – (3) Inform the Agency or Bureau of the Pending • Medicare Coordinator of Benefits Settlement and Request a Final and Full Contractor Itemization of Medical Expenses for Purposes of P.O. Box 5041 Settlement. The agencies tend to respond to these New York, NY 10274-5044 requests. It takes four to six weeks or so to receive • Phone: (800) 999-1118 a response. It is wise to follow-up with a phone call • Fax: (646) 458-6772 after four weeks. The statute requires that “No settlement, compromise, judgment, or award or any o (3) Medicare then creates a computer file recovery shall be made final without first giving the on the claim, assigns it to a third party appropriate departments notice and reasonable contractor who will contact you. opportunity to perfect their rights of recovery.” One benefit of going directly to ODHS is that it provides an itemization showing that the medical bills were significantly reduced due to their payment regulations. CONTINUED 29 o (4) The contractor to whom they assign the • Steps to take and who to contact for Worker’s claim to is: Compensation: • MSPRC – (1) Call Linda Wycuff at 1-614-644-7410 P.O. Box 33828 o She is in the Legal Subrogation Department Detroit, MI 48232-3828 – (2) Be prepared with the following information • Phone: (866) 677-7294 o (1) Claim Number (Most important piece • Fax: (734) 957-0998 of information!!!) o (2) Social Security Number (Important if – For Medicare claims being settled where workers’ you don’t have the claim number) compensation coverage exists: o (3) Date of Injury o This applies to medical bills that have been o (4) Employer paid by Medicare in which Workers o (5) Date of Birth Compensation is primary (Doesn’t apply to o (6) Type of Accident most claims in Ohio) – (3) Linda will tell you what needs to be done from o Follow the same process as above for here… liability claims, but they get sent to a – Contact information for the Bureau of Worker’s Compensation: different coordinator and contractor. o BWC o Send to: 30 W. Spring Street • P.O. Box 660 Columbus, OH 43215-2233 New York, NY 10274-0660 o Telephone: 1-800-644-6292 Note that where an out-of-state employer o Fax: 1-877-520-6446 is involved, the Worker’s Compensation o Website: https://www.ohiobwc.com/ coordinator might be different! default.asp – Subrogation claims arising from worker’s If you get stuck, there is a helpful website: compensation payments are governed by the laws http://www.cms.hhs.gov/MSPRGenInfo/ of the state in which compensation was paid. American Interstate Ins. Co. v. G & H Service Center, • Steps to take and who to contact for Medicaid: Inc. 11 Ohio St. 3d 521, 2007-Ohio-608. In Bush v. – Medicaid uses an outside service for their “Tort Senter, 141 Ohio Misc. 2d1, 2006-Ohio-7155 an Recovery”, called PCG analysis of the subrogation obligations fails to – Contact Information for PCG: clarify the attorney’s obligation, but discusses o Capital Square settlements and trials. 65 E State St, Ste 1530 Columbus, OH 43215 • Steps to take and who to contact for Federal o Telephone: (614) 242-1045 Claims: o Website: https://cmts.pcgus.com/ – Contact the U.S. Department of Labor at: casemgt/Leads/Default.asp o 1-866-487-9243 – Commence the process online by entering the claim – Ask for the number of the person who handles information, or you may call PCG Federal Worker’s Compensation claims in your area o Be sure to have the claim/case number – The numbers for Cleveland area are: when calling! o Customer Service: 1-216-357-5100 o Automated System (if you have the claim number): 1-866-335-8319 – Website: www.dol.gov Summer 2009 OACTA Quarterly Review 30 • Alternative contacts with the State of Ohio where This places the burden on the third party payee to one cannot identify the proper agency. resolve the question of how to collect from the – Serve notice to one of the following addresses: plaintiff. o Attorney General of Ohio c/o Collections Enforcement Section – Why the Right of Recovery? The law was drafted 150 E. Gay Street, 21 Floor st as a response to losses in which the courts had Columbus, OH 43215 ruled that ODHS merely enjoyed the rights of the insured party. The Attorney General’s Office argued o Director, Ohio Department of Job and for years that the right is an independent cause of Family Services action for reimbursement, not a subrogation right. c/o Office of Legal Services The Attorney General had been hampered by 30 E. Broad Street, 31 Floor st statutes deemed by the Courts to be unambiguous Columbus, OH 43215 in allowing subrogation rather than an independent cause of action. The state finally listened to its • What if I do not have any success with the above? lawyers and rewrote the law to devise an – Settle with an indemnification agreement which independent cause of action. binds plaintiff’s counsel. Although this is a fairly decent device, it is limited to the ability and – Loss of Defenses: A more startling and sneaky willingness of plaintiff’s counsel to assume the aspect of this statute was that comparative obligation. negligence and all other defenses against the state’s right of recovery are waived if not – Set up a trust in which the proceeds are payable to established in the underlying case. Defense the agency. It is preferable to avoid this device, counsel will need to establish defenses in the since it would entail separate legal expense and course of a trial involving the original claimant. The may require the engagement of trust counsel. only alternative will be settlement with the consent of ODHS, or possibly, some judicial determination of – Do nothing, and let the Claims Department figure it the defenses that might be used in subsequent out when the claim surfaces in the distant future. litigation. Remember, securing a standard release is doing nothing. – Profiting from Managed Care: Revised Code §5101.58 also provides that the state shall be • What does the Future Hold for State Subrogation reimbursed for the amount the managed care Claims? organization pays for medical services rendered, – Right of Recovery: In an attempt to simplify the even if that amount is more than the amount the life of an insurance adjuster, the state legislature departments pay to the managed care organization passed a bill known as House Bill 215. Effective 9/ for the recipient’s medical care. In other words, the 29/97, Revised Code Section 5101.58, no longer state can lay claim to an amount in excess of that is discusses a right of subrogation, but provides a right paid to the managed care organization. Since Ohio of recovery. The right of recovery is designed to retains no legislative history setting forth the mirror the federal independent right of recovery reasoning behind the law, no explanation for this which is not deemed to be subrogation. In other revenue enhancement protocol exists. words, the government will no longer be limited to the rights and claims of the claimant, but has an independent right to collect the medical expenses. CONTINUED 31 – Exposure to Additional Expenses: “The departments shall be permitted to enforce their Patrick S. Corrigan serves as Managing Attorney recovery rights against the third party even though for the Cleveland Office for the Staff Counsel of the they accepted prior payments on discharge of their Cincinnati Insurance Company. His practice rights under this section, if at the time their includes insurance coverage, construction, and departments received such payments, they were professional tort defense. Mr. Corrigan has not aware that additional medical expenses had presented on insurance law, brain injury defense been incurred but had not yet been paid by the and nursing home malpractice. He earned his B.A. departments.” This statutory language has not degree from John Carroll University and his J.D. been challenged. degree from the Cleveland-Marshall College of Law, where he was Chairman of the Moot Court Program. – Authority to Adopt New Rules: Additional Mr. Corrigan is a member of the Cleveland language in the law allows the ODHS to adopt rules Metropolitan, Ohio State and Federal Bar necessary to implement the revised statute. Thus, associations, Defense Research Institute, and the we can anticipate new regulations governing Ohio Academy of Civil Trial Attorneys. settlements and liens. – Loss of Sovereign Immunity: Another section of H.B. 215, §2744.05(B)(2)(b), effective 9/29/97 states that nothing shall “prohibit the Department of Human Services from recovering from the political subdivision pursuant to Section 5101.58 of the Revised Code, the cost of medical assistance benefits provided under Chapter 5107.5111, or 5115 of the Revised Code.” The practical effect of this revision is to eliminate the defense of immunity which could be asserted by a government employee. Previously, a subrogation claim by ODHS was barred when it was made against another State of Ohio employee or department. This change has the potential interesting effect of employing private attorneys to defend the various state departments once the Attorney General files suit against his/her own clients. – Acknowledgement: The author gratefully acknowledges the assistance of Angela Drook, Esq. in preparing this treatise. Summer 2009 OACTA Quarterly Review 32 Ohio Supreme Court: Tort Claims and a New Comity1 Bruce P. Mandel and James N. Kline Ulmer & Berne LLP On October 22, 2008 the Ohio Supreme unconstitutional or otherwise invalidated by the Ohio Court held in DiCenzo v. A-Best Products Supreme Court. See e.g. Morris v. Savoy, 61 Ohio St.3d 684 Company, Inc., et al, Slip Op. No. 2008- (1991); State ex. rel. Ohio Academy of Trial Lawyers v. Ohio-5327, that its seminal decision in Sheward, 86 Ohio St. 3d 451 (1999).4 However, since Temple v. Wean United, Inc., (1977) 50 Sheward, the Ohio legislature has undertaken a host of new Ohio St.2d 317, which for the first time tort reform measures which have, thus far, withstood any Bruce P. Mandel found suppliers (non-manufacturers) constitutional scrutiny. liable in common law strict tort liability, could not be applied retroactively to Apportioned Liability conduct which occurred prior to the Temple decision. The DiCenzo decision The newest tort reform measures largely began with Senate effectively undermined the ability of Bill 120 (“S.B. 120”),5 which became effective April 9, plaintiffs, particularly in asbestos 2003. S.B. 120 largely eliminated “joint and several litigation, to sue non-manufacturer liability” in Ohio, which had previously rendered even the James N. Kline (supplier/installer/distributor) most remote defendant potentially responsible for the defendants, whose underlying sale or entirety of a judgment. In its stead, S.B. 120 introduced installation of products predated the 1977 decision in apportioned liability. Similar to other States which had done Temple. so beforehand, these statutes provide that if a defendant’s liability is 50% or less of the tortious conduct, that defendant DiCenzo was the most recent in a string of Ohio Supreme is essentially liable only for its proportionate share of Court decisions since 2002, which have demonstrated a damages.6 Moreover, O.R.C. §2307.011 defines broadly change from an aggressive Court, deemed a “super- the persons or entities against whom apportioned shares legislature on several major public policy issues in Ohio”, to 2 may be attributable, thus allowing a jury to view the whole a Court which appears to have restored a reasonable picture of causative agents, and in the context of toxic torts, balance of power between itself and the Ohio Legislature. occupational exposures and apportion any judgment No longer in the business of expanding tort liability and accordingly.7 striking down tort reform efforts, the Court has now shown deference to tort reform legislation, intended to reign in Then in May, 2003, an even more comprehensive tort further expansion of tort liability. 3 reform act, Amended Substitute Senate Bill 80 (“S.B. 80”), was adopted, and became effective on April 7, 2005. S.B. The following discussion of recent Ohio legislative 80 imposed caps on damages, and reintroduced a Statute enactments and corresponding Ohio Supreme Court rulings of Repose, after prior Statutes of Respose had been found illustrates this judicial restraint and cessation of tort liability unconstitutional. expansion. Damage Caps I. Tort Reform S.B. 80 capped non-economic (pain and suffering) loss in Between 1975 and 2002, the Ohio Legislature enacted non-catastrophic injury cases to the greater of $250,000 or numerous tort reform measures, all of which were found CONTINUED 33 three times the amount of economic damages up to a cap directly controlling”. Groch at ¶147. The Court, therefore, of $350,000 per plaintiff and $500,000 per occurrence. 8 upheld the constitutionality of this Statute of Repose for Similarly, S.B. 80 capped punitive damages to two times the products and presumably would do so for the new Statute of amount of compensatory damages awarded, or even less if Repose for improvements to real property. the defendant is deemed a “small employer” as defined in the statute.9 The Supreme Court, therefore, isolated Brennaman, indicating it would no longer apply the case or its holding. As expected, S.B. 80 and its limitations on damages were The apparent basis for this isolation also relates to constitutionally attacked. However, the Ohio Supreme Court “changes” in the new Statute of Repose, that differentiate it in Arbino v. Johnson & Johnson, (2007), 116 Ohio St.3d from the statute that had been stricken in Brennaman — 468, 2007-Ohio-6948, upheld the statutory limitations including new provisions in the uncodified section discussed above. While recognizing that “. . . State establishing the propriety and constitutionality of the legislatures and judiciaries have differed widely in their application of the Statute of Repose for improvements to responses to this issue, and a definite split in authority is real property. clear. . .” (Arbino, ¶20). After years of the Ohio Supreme Court undermining such legislation, it was finally deemed The Supreme Court in Groch invoked with approval its constitutional in Arbino. 10 previous reasoning in Sedar (“Although Sedar was a thorough and concise opinion that fully sustained each of its Statutes of Repose specific conclusions with extensive reasoning, Brennaman is the classic example of the “arbitrary administration of S.B. 80 also included ten year Statutes of Repose for justice” that Galatis [Westfield Insurance Co. v. Galatis products (O.R.C. §2305.10(C)) and for improvements to 11 (2003), 100 Ohio St.3d 216, regarding stare decisis] real property (O.R.C. §2305.131). These new Statutes of cautions against. Brennaman cavalierly overruled Sedar with Repose expressly provide that they are superior to any virtually no analysis.” Groch, ¶136-137). Other Courts have applicable Statute of Limitations. As part of similar tort 12 recognized that in Groch, the Ohio Supreme Court has reform efforts over the years, the Ohio Legislature had resurrected Sedar’s analysis with respect to statutes of enacted prior Statutes of Repose, but they were summarily repose. See Nickell v. Leggett & Platt, Inc. (12th Dist. 2008), rejected and found unconstitutional by the Ohio Supreme 2008 Ohio 5545; Metz v. Unizan Bank (N.D. Ohio 2008), Court. See e.g. Brennaman v R.M.I. Co. (1994) 70 Ohio St. 2008 U.S. Dist. LEXIS 37270; Lopardo v. Lehman Bros., Inc. 3d 460. However, a constitutional challenge to the new (N.D. Ohio 2008), 548 F. Supp. 2d 450, 2008 U.S. Dist. Statute of Repose for products was recently rejected and the LEXIS 17377. Statute upheld in Groch v. General Motors Corp. (2008), 2008 Ohio 546. These cases that have followed in the wake of Groch have applied its reasoning. More recently, the Court of Appeals in In Groch, the Ohio Supreme Court discussed its earlier McClure v. Alexander (2nd Dist. 2008), 2008 Ohio 1313 decision in Brennaman v. R.M.I. Co. (1994) 70 Ohio St.3d concluded that Ohio’s new Statute of Repose for 460, which had overruled an earlier case, Sedar v. Knowlton improvements to real property is constitutionally viable and Construction Co. (1990), 49 Ohio St.3d 193. Sedar had applicable so as to bars claims. In McClure, the Court held: upheld a prior Statute of Repose dealing with improvements to real property, but Brennaman reexamined the same issue Finally, we examine the particular features of and struck it down. In Groch, the Ohio Supreme Court R.C. 2305.131 to resolve the issue before us, recognized the deficiency in its reasoning in Brennaman, namely whether, as McClure argues, the and while not expressly overruling Brennanman, declined “to doctrine of stare decisis requires us to strike follow its unreasoned rule in contexts in which it is not down the current version of the statute of Summer 2009 OACTA Quarterly Review 34 repose. In other words, we must determine Groch, at P 106, quoting Arbino. In other whether or not the current version of R.C. words, Brennaman is not directly controlling. 2305.131 is “substantially the same” as the previous version overruled in Brennaman, the McClure, supra. (Emphasis added). As a result, the McClure “unreasoned rule” of which remains in Court applied and ebforced the latest statute of repose for constricted effect[based on Groch]. improvements to real property. The previous version of the statute provided in Based upon the application of similar statutes in other part, “no action * * * shall be brought,” while jurisdictions, this new Statute of Repose for improvements the current version, like the constitutional to real property may provide significant assistance to many statute of repose in Groch, provides in part, types of defendants. See generally, Adair v. Koppers Co. “no cause of action * * * shall accrue.” We (N.D. Ohio, E.D. 1982), 541 F.Supp. 1120, aff’d by (6th Cir. agree with Alexander, the “current 1984), 741 F.2d 111 (conveyor belt held to be version of R.C. 2305.131 recognizes that improvement to property); Pacific Indemnity Co. v. a true statute of repose actually Thompson-Yaeger, Inc. (Minn. 1977), 260 N.W.2d 548 prevents a cause of action from (furnace installed in a store deemed an “improvement to accruing rather than preventing a real property”, but statute ruled unconstitutional); Herriott v. plaintiff from bringing an action after Allied Signal, Inc. (7th Cir. 1993), 998 F. 2d 487 (coke accrual,” like a statute of limitation. As processing plant’s “larry-car” was an improvement to real noted by the Groch Court, the legislature property for purposes of a 10-year Statute of Repose); Krull is free to modify or abolish common law v. Thermogas Co. of Northwood, Iowa, Div. of Mapco Gas actions in which no one has a vested Products, Inc. (Iowa 1994), 522 N.W.2d 607 (small control right; by its language, the current valve on a liquid propane furnace held to be an version of R.C. 2305.131 “can prevent improvement to real property); Harder v. ACandS (8th Cir. claims from ever vesting [if the 1999), 179 F.3d 609 (Statute of Repose barred claim for improvement was substantially asbestos exposure from thermal blankets which were completed] more than ten years before attached but not permanently affixed to turbines); Tallman v. the injury occurred.” Id., at P 149. In W.R. Grace Co. (Iowa 1997) 558 N.W.2d 208 (once other words, McClure’s cause of action asbestos containing spray was affixed to structure, it was an against Alexander never accrued, and it improvement to real property subject to Statute of Repose); accordingly never became a vested Abbott v. John E. Green Co. (Mich. App. 1998), 592 N.W.2d right. As in Groch, “this feature of the 96 (Statute of Repose applied to installers of asbestos statute triggers the portion of Sedar’s containing products); Pendzsu v. Beazer East, Inc. (Mich. fundamental analysis concerning App. 1996), 557 N.W.2d 127 (design, manufacture, Section 16, Article I that is dispositive of installation and relining of coke ovens and the engineering our inquiry.” and relining of blast furnaces considered improvements to real property); Trust Co. Bank v. U.S. Gypsum Co. (5th Cir. *** 1992), 950 F.2d 1144 (fireproofing materials used in bank construction subject to Statute of Repose); But see Buttz v. Having carefully reviewed the particular Owens-Corning Fiberglas Corp. (Iowa 1996), 557 N.W.2d 90 features of R.C. 2305.131, we conclude that (exposure to insulation during installation process was not it is sufficiently different from the previous subject to Statute of Repose). version considered in Brennaman “to avoid the blanket application of stare decisis.” CONTINUED 35 II. Asbestos Medical Impairment Legislation/ procedure to prioritize the administration Court Challenges and resolution of a cause of action that already exists”. (Id. at ¶16) In June, 2004, the Ohio Legislature passed a medical impairment asbestos statute (Amended Substitute House Bogle was a precursor to the October, 2008 Ohio Supreme Bill 292 [“H.B. 292”]) which became effective on Court decision in Ackison which upheld the constitutionality September 2, 2004. 13 It essentially placed, in of the retroactivity provisions in H.B. 292, rendering the administrative dismissal purgatory, virtually all non- statute applicable to the tens of thousands of claims malignant cases until and only if those claimants meet the pending in Ohio on the effective date of the statute. Relying medical criteria establishing legitimate disease. H.B. 292 upon Bogle, the Court in Ackison held that: also created legislative hurdles for any asbestos lung cancer claimant who had been a significant cigarette smoker. “The requirements in R.C. 2307.91, 2307.92, and 2307.93 are remedial and In short, the purpose of H.B. 292 was to limit the glut of procedural and may be applied without medically questionable asbestos cases clogging the dockets offending the Retroactivity Clause of the in Ohio, particularly in the Cleveland (Cuyahoga County) Ohio constitution to cases pending on area. Plaintiffs attacked the new asbestos legislation September 2, 2004.” Ackison at the largely on the basis of its retroactive effect, but the Ohio syllabus. Supreme Court upheld H.B. 292’s constitutionality in two cases: Norfolk v. Bogle (2007) 115 Ohio St.3d 455; The plaintiff in Ackison argued that the legislation had an Ackison v. Anchor Packing Company, 2008 Ohio 5243. unconstitutionally retroactive impact because it barred claims like those of her decedent for pleural thickening In Bogle, the Ohio Supreme Court held, in the context of an which had previously been classified as a compensable asbestos claim brought under the Federal Employer’s injury under common law. The Court rejected this argument, Liability Act and the Locomotive Boiler Inspection Act, that finding instead that there was no common law definition of the Ohio asbestos tort reforms in H.B. 292 did not violate injury. Since there had been no fixed definition of injury the Supremacy Clause of the United States Constitution adopted by the courts of Ohio, the legislature was free to since the filing requirements were procedural in nature, and establish that definition by means of H.B. 292. Thus, the thus could be imposed on the plaintiffs. As they were Court found that plaintiff had no vested right in earlier court procedural, they did not impair the Federal rights upon which definitions of asbestos-related injury. Moreover, the Ohio plaintiffs’ claims were based. The Court stated: Supreme Court held that the legislation did not extinguish the right to recovery, but merely “caused a hold to be placed “[S]ubstantive laws or rules are those that on the claim….” Ackison, ¶27. “relate to rights and duties which give rise to a cause of action.” By contrast, The Court in Ackison also rejected plaintiff’s argument that procedural rules concern “the machinery the statute, by defining the term “competent medical for carrying on the suit.” Id. A review of the authority” and mandating that such medical authority be statutes reveals that they do not grant a used to prove medical impairment, impermissibly altered right or impose a duty that “give[s] rise to a the burden of proof placed upon a claimant. Again, the cause of action.” Id. Instead, the impact of Court found that there was no prior established definition of these statutes is to establish a procedural this term either by statute or common law. The legislature prioritization of the asbestos-related cases was, therefore, free to establish this definition in the same on the court’s docket. Nothing more. manner that it could establish a rule of competency Simply put, these statutes create a governing any expert witness testifying in court. This again Summer 2009 OACTA Quarterly Review 36 fell into the realm of procedural, rather than substantive non-manufacturer defendant suppliers, installers and issues, and thus was a permissible exercise of legislative distributors of asbestos-containing products prior to 1977 power. Ackison, ¶29. could not be sued under common law principles of strict liability. Since most asbestos products were sold or installed The plaintiff also asserted that H.B. 292 altered the prior to 1973, this effectively undermined the ability of most requirements of causation by defining “substantial asbestos plaintiffs to sue non-manufacturers in Ohio in contributing factor,” and including a requirement that common law strict tort liability, relegating them to claims of “[E]xposure to asbestos is the predominate cause of the negligence. physical impairment alleged in the asbestos claim.” O.R.C. §2307.91(FF) (1). Plaintiff argued that this contravened Previously, in Potts v. 3M Company, et al.,16 the Ohio 8th the Court’s earlier decision in Horton v. Harwick Chem. Corp. District Court of Appeals affirmed the Trial Court ruling and (1995), 73 Ohio St.3d 679, which established the rejected a plaintiff’s attempt, under Ohio’s Product Liability “substantial factor” test for causation. The Court wrestled Act17, to utilize statutory strict liability claims against with the term “predominate cause,” but ultimately suppliers. The Ohio Court of Appeals held that statutory interpreted it as a “but for” test of causation — which was strict liability was not available against a supplier under the consistent with previous court decisions — so as to uphold two commonly proffered elements of the statute in asbestos the constitutionality of the legislation. Ackison, ¶49. The litigation.18 First was “insolvency” of the manufacturer. The Court in Ackison explained that Horton merely addressed Court rejected plaintiff’s claim that bankruptcy was the the applicable burden of proof in a multiple defendant case, equivalent of insolvency and held that if any Bankruptcy but at their core, both Horton and the statute involved a “but Trust from the numerous asbestos manufacturer for” test. Ackison, ¶51. bankruptcies paid monies to claimants, that manufacturer could not be deemed “insolvent” for purposes of the Ohio Finally, the court rejected plaintiff’s view that the definition statute. of “substantial occupational exposure” in O.R.C. §2307.91(GG) was an impermissible attempt to introduce Second, the Court held that claimed “lack of judicial the so-called Lohrmann criteria and apply them 14 process” as to the manufacturer, did not apply to currently retroactively in contravention of the Court’s previous bankrupt entities which had previously been subject to long decision in Horton, supra which had expressly rejected these arm jurisdiction in Ohio.19 criteria. The Court in Ackison again held that the new statutory criteria were simply a means of “procedural The plaintiff in Potts attempted a discretionary appeal to the prioritization,” and did not alter the burden of proof for Ohio Supreme Court but the Court rejected the appeal, and existing claims. According to the Court, the express let stand the favorable rulings by the Trial Court and Court of inclusion of the Lohrmann criteria in a different portion of Appeals severely limiting statutory strict liability claims in the new law underscored this differentiation between an 15 Ohio against non-manufacturers. The plaintiffs’ Bar then effort at prioritizing claims and actually altering the went to “Plan B” and attempted to assert common law substantive elements for establishing causation. As for this strict liability claims which resulted in the recent DiCenzo latter issue, the Court noted that the adoption and Opinion. application of the Lohrmann criteria in the statute was explicitly prospective, and thus constitutional. Ackison, ¶61. DiCenzo stemmed from the supplier defendants being sued for having sold or installed asbestos-containing products III. Rejection of Strict Liability Against Suppliers from the 1950s to the early 1970s. By the 1990s, most of the major manufacturers of those products had filed for During the same week Ackison was decided, the bankruptcy due to the onslaught of the asbestos litigation Ohio Supreme Court decided the DiCenzo case, holding that CONTINUED 37 and thus could not be sued by plaintiffs, whose disease took “Imposing such a potential financial burden decades to manifest. Accordingly, the plaintiffs’ Bar pointed on these nonmanufacturing suppliers years their guns at mere suppliers/installers of asbestos products. after the fact for an obligation that was not They sued suppliers based upon the 1977 Temple v. Wean foreseeable at the time would result in a decision, which first adopted common law strict liability great inequity.” DiCenzo, at ¶47. against non-manufacturers. These claims of common law strict tort liability would, in effect, force the suppliers to Importantly, the ramifications of the Ohio Supreme Court defend a product manufactured by another. However, by decision should not be limited only to suppliers of asbestos disallowing strict tort liability against the suppliers, the Court products. Common law strict liability claims will now also be would relegate plaintiffs to negligence claims against the obviated against pre-1977 sellers of other products (such as suppliers. As these negligence claims would be based upon benzene, silica and lead paint) that may have contributed to the suppliers’ knowledge of the alleged product hazards, a disease that also did not manifest itself until years later. they would be more defensible than claims for strict tort Similarly, suppliers of materials and components that liability, which are based upon the allegedly defective became parts of commercial buildings more than 30 years product. ago may also be protected from common law strict tort liability claims, should those materials eventually be The inquiry in DiCenzo was whether Temple v. Wean was to deemed defective. be applied retroactively to impose common law strict liability upon suppliers. To decide the retroactivity issue, the Ohio Conclusion Supreme Court in DiCenzo dealt with the applicability of the elements set forth in the United States Supreme Court The foregoing decisions by the Ohio Supreme Court have decision in Chevron Oil Co. v. Huson (1971), 404 U.S. 97, demonstrated the substantial change in what had been an 92 S. Ct. 349, 30 L. Ed. 2d 296. The first issue in this regard “activist” Court — constantly striking down legislative was whether Chevron Oil, dealing with the prospective or attempts at tort reform and expanding tort liability — to a retroactive nature of Court rulings, had been overruled by Court with a more reasoned, fair, and legislatively respectful Harper v. Virginia Dept. of Taxation (1993), 509 U.S. 86, approach.20 As a result of recent Ohio legislation and the 113 S. Ct. 2510, 125 L. Ed. 2d 74. The Ohio Supreme Court Ohio Supreme Court’s change in attitude, the landscape in ultimately decided that Harper did overrule Chevron Oil but Ohio for businesses and product liability defendants has only when applying Federal law. According to the DiCenzo been improved considerably. Court, Chevron Oil remains viable for purposes of analyzing State law in Ohio. The Ohio Supreme Court then adopted Chevron’s analytical framework for purposes of determining the retroactive or prospective application of a Court decision Endnotes 1 The following article is an expanded version by the same authors and, specifically in DiCenzo, dealt with the issue of whether that was originally published in The Legal Backgrounder, Washington Legal Foundation, Volume 24, No. 3, January 2009, or not the 1977 decision in Temple v. Wean — in which “Ohio Supreme Court Upholds Limits On Product Liability Suits.” strict liability against suppliers (non-manufacturers) was 2 See David J. Owsiany, The Ohio Supreme Court: A Court at the Crossroads (Federalist Society for Law & Public Policy, October “born” in Ohio — should be applied retroactively, as plaintiffs 2004 at p. 1-2), available at http://www.fed-soc.org/doclib/ 20070325_ ohio.pdf. claimed. 3 For a detailed discussion of the changes in the Ohio Supreme Court’s personnel and philosophy, See Jonathan H. Adler and Christina M. Adler, “A More Modest Court: The Ohio Supreme Ultimately, the Ohio Supreme Court determined that it would Court’s New Found Judicial Restraint”, (Federalist Society for Law & Public Policy Studies, October, 2008 at p. 3). be inequitable to impose the Temple decision on non- 4 For a more complete discussion of this tort reform history, see manufacturing suppliers of asbestos products that sold or Tunnel, Sferra, and Motter, “Ohio High Court Upholds Law Limiting Tort Damages,” The Legal Backgrounder, Washington Legal installed those products prior to the Temple decision, Foundation, Volume 23, No. 6, February, 2008. 5 Enacted as O.R.C. §§2307.22, 2307.23 and related §2307.11. holding: Summer 2009 OACTA Quarterly Review 38 6 Where it is determined that more than 50% of tortious conduct is attributable to a defendant, then that defendant is jointly and severally liable for the entire economic loss. See O.R.C. As a partner with Ulmer & Berne LLP with over 20 §2307.22(A)(1) and §2307.011. 7 As defined by the Trial Judges who administer the special asbestos years of experience, Jim Kline focuses his practice docket in Cleveland, this includes non-parties such as the on negligence, product liability defense, toxic tort, approximately 85 former manufacturers of asbestos products who have filed for bankruptcy protection. first-party insurance defense litigation, employer 8 O.R.C. §2315.18. 9 O.R.C. §2315.21. intentional tort, commercial and construction related 10 For a more comprehensive discussion of the Arbino decision and claims. He litigates in federal and state trial courts, the legal arguments therein, see the article cited in Footnote 3 above. as well as state appellate court. His clients include 11 The Statute of Repose for products expressly exempts claims based upon exposure to asbestos. insurers, manufacturers, major national retailers, 12 Ohio has a two year statute of limitation for general tort actions major national restaurants, premises owners, (O.R.C. §2305.10(A)). A “discovery rule” applies to claims based on asbestos exposures (O.R.C. §2305.10(B)(5)), as well as other contractors, not-for-profit organizations and toxic exposures (O.R.C. §2305.10(B)(1-4)). Under the“discovery rule” set forth in each of these provisions, the cause of action municipalities. “accrues upon the date on which the plaintiff is informed by competent medical authority that the plaintiff has an injury that is related to the exposure, or upon the date on which by the exercise of reasonable diligence the plaintiff should have known that the plaintiff has an injury that is related to the exposure, whichever A partner with Ulmer & Berne LLP and Chair of the date occurs first.“ Firm’s Toxic Tort Defense Group, Bruce Mandel 13 The Legislature contemporaneously promulgated a similar medical impairment statute for silica cases (H.B. 342), but without defends all types of industrial exposure cases. He a provision explicitly deeming it retroactive, unlike the asbestos statute. administers and defends asbestos and silica claims 14 These criteria were adopted in the case of Lohrmann v. Pittsburgh for numerous clients in both federal and state courts. Corning Corp. (4th Cir.1986), 782 F.2d 1156, in which the Court required a plaintiff to establish “exposure to a specific product on He has more than 30 years of experience in a regular basis over some extended period of time in proximity to where the plaintiff actually worked.” Id. at 1162-1163. defending product liability claims, handling bodily 15 O.R.C. §2307.96. injury claims for both plaintiffs and defendants, and 16 2007 Ohio 1144; 2007 Ohio App. Lexis 1057. 17 O.R.C. §2307.78(B) set forth the limited bases upon which representing owners, architects, and contractors in suppliers could be subject to strict liability as if a manufacturer. 18 See O.R.C. §2307.78(B)(1) and (2). construction litigation cases. He also has extensive 19 Plaintiff claimed that “lack of judicial process” was the equivalent experience in major business litigation as well as of “lack of service” but the Court disagreed, siding with the supplier defendant in defining “lack of judicial process” as “lack of successfully mediating business and real estate jurisdiction”. Since the bankrupt manufacturers had done business in Ohio, they had been subject to long arm jurisdiction, disputes. and thus there was no “lack of judicial process”. 20 This new deference to legislative intent may even be demonstrated in Eppley v. Tri-Valley Local School Dist. Bd. Of Ed. (2009), 2009-Ohio-1970, where that legislative intent is unexpressed. In Eppley the Ohio Supreme Court held that differences between Ohio’s so-called “Saving Statute” for wrongful death claims, O.R.C 2125.04, and for general claims, O.R.C. 2305.19 (A) — the latter of which was amended in 2004 to expand the savings period for refiling previously dismissed claims — did not violate the right to equal protection of the law under the Fourteenth Amendment to the United States Constitution and Section 2, Article I of the Ohio Constitution. 39 Introduction Personal Injury Defense Committee ...CONTINUED FROM PAGE 2 This year also saw the birth of our committee web page Ohio Revised Code section 2317.421, to include “anti- located at the OACTA website (www.OACTA.org). Currently, Robinson” language.) you can find there a catalogue of the various decisions of the trial courts on the issues we have all come to know as So as always, tort law in Ohio keeps evolving and changing. the “Robinson v Bates,” conundrum. The decisions are listed Our effort at OACTA is to share information with and among by county and judge, with an indication of whether the the membership that keeps all of us current, and if we’re opinion was “for” or “against setoff” and whether it was lucky, perhaps one step ahead of that change. “pre” or “post” enactment of the new collateral source statute, 2315.20. In this Quarterly, Mark Engling has Finally, I would like to thank Jamey Pregon for his provided a fine review of the issues and arguments at the outstanding contribution to this committee. Jamey has center of the “Robinson Debate.” In the interest of staying up served as coordinator/editor for this edition of the Quarterly to date on this topic, it should be noted that the decision of and authored an informative article himself, on top of the Lucas County Court of Appeals cited in Mark’s piece opening his own law office in Dayton — Dinkler Pregon, LLC. (Jacques v Manton, March 20, 2009; Case No: L-08-1096) I know our committee will be in good hands when he has recently been appealed to the Ohio Supreme Court. It is assumes the chair at our Annual Meeting in November. I possible the Ohio Supreme Court will settle the issues once hope you will find the information we provide here, and and for all. (However, it should also be noted that certain through the seminars and the web page to be useful in your prominent members of the Plaintiffs’ bar have recently practice, and I hope to see many of you at State Auto in introduced proposed legislation in the Ohio House to amend August. Summer 2009 OACTA Quarterly Review 40 A G E N D A and S P E A K E R S 8:00 – 8:25 am Registration / Continental Breakfast / Exhibits Open 8:25 – 8:30 am Welcome Gretchen Koehler Mote, Esq., OACTA President 8:30 – 9:00 am “The Presence of Third Parties and Videotaping of Independent Medical Examinations” Matthew J. Smith, Esq., Smith, Rolfes & Skavdahl Co., LPA 9:00 – 9:30 am “Tips and Traditions in Personal Injury Defense” Terrence J. Kenneally, Esq., Terrence J. Kenneally & Associates 9:30 – 10:00 am “Tort Reform in Ohio – an Update” Victoria D. Barto, Esq., Sutter, O’Connell, Mannion & Farchione 10:00 – 10:15 am Break with Exhibitors 10:15 – 10:45 am “Investigating the Personal Injury Claim” Robert Friedrick, Friedrick & Associates, Inc. 10:45 – 11:15 am “Personal Injury Litigation Ethics” Lawrence A. Sutter, III, Esq., Sutter, O’Connell & Farchione 11:15 – 11:45 am “Civility in Personal Injury Practice – A View from the Other Side” Donald C. Moore Jr., Esq., The Moore Law Firm Noon – 1:00 pm LUNCH – Derby Court, Columbus Museum of Art LUNCHEON ADDRESS: Justice Maureen O’Connor, Supreme Court of Ohio 1:15 – 2:00 pm “The Art and Science of Civil Litigation – A View from the Bench” Honorable Christopher Collier, Medina County Court of Common Pleas 2:00 – 2:30 pm “Personal Injury Litigation Strategy and Tactics” Richard Kerger, Esq., Kerger & Hartman, LLC August 28, 2009 2:30 – 3:00 pm “Personal Injury News from the Statehouse” Brian P. Riley, Esq., Weston Hurd, LLP State Auto Jon Allison, State Auto Insurance Companies Insurance Companies 3:00 – 3:15 pm Break with Exhibitors Columbus 3:15 – 3:45 pm “The View from Claims –What We Want From Defense Counsel” PANEL DISCUSSION: Steve Miller, State Auto Insurance Companies Register Online at www.OACTA.org Steve Popelsky, Esq., Motorists Mutual Insurance Companies Barbara Brown, Motorists Mutual Insurance Companies Ohio Randy Anderson, State Farm Mutual Auto Association Insurance Company of Civil Trial OACTA Attorneys 3:45 – 4:15 pm “Independent Medical Examination – Its Uses and Limits” Manuel A. Martinez, M.D., The Source for Defense Success Orthopedic Associates 4:15 pm Adjourn Ohio Association of Civil Trial OACTA Attorneys The Source for Defense Success 17 South High Street, Suite 200 Columbus, Ohio 43215 Ohio Association of Civil Trial Attorneys 2009 Second Annual Meeting November 12 & 13, 2009 The Westin Columbus Columbus Situated in the heart of downtown Columbus, the newly-renovated Westin Columbus is a hospitality landmark. Experience the grandeur and elegance of their stunning Grand Ballroom, the city’s premier event site.
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