Seventh Circuit Court of Appeals Commentary : In Their Opinion : Lawyer & Attorney Michael E. Rigney : Kelley Drye & Warren Law Firm

ARROYO v. UNITED STATES OF AMERICA (September 1, 2011)

Maria Arroyo received medical care at the federally-funded Erie Family Health Center during her pregnancy. Her doctors there detected no problems with her pregnancy. She gave birth to a son in May of 2003, more than a month premature. Her doctors never gave her a series of tests that are typically administered in the last month of pregnancy to detect the risk of the baby contracting a disease from his mother's blood. In those situations where the tests are not administered, medical professionals involved in the birth are more vigilant in identifying risk factors and treating the baby. Although Arroyo's baby did exhibit several risk factors, the treating doctors failed to detect or treat an infection. The baby suffered permanent brain damage. The hospital told Arroyo that her son suffered brain damage because of exposure to blood but did not tell her that it could have been prevented. A year later, Arroyo gave birth to a second son. In connection with that birth, she learned about the risk of infection and what could be done about it. A few months later, she saw a lawyer’s ad on television that prompted her to consult her own lawyer. In December of 2005, the Arroyos filed a medical malpractice claim against the two treating physicians in state court. Because the Erie Center doctors are treated as federal employees, the United States assumed the liability and the case proceeded in federal court under the Federal Tort Claims Act. Judge St. Eve (N.D. Ill.) found in favor of the Arroyos after a bench trial, concluded that the claim was brought within the two year statute of limitations, and awarded over $29 million in damages. The United States appeals.

In their opinion, Seventh Circuit Chief Judge Easterbrook and Judges Cudahy and Posner (concurring) affirmed. An FTCA claim is timely if it is filed within two years of its accrual. A claim accrues when the plaintiff discovers or should have discovered that he has been injured by an act attributable to the government. The Court emphasized that knowledge of government control is necessary. Here, the Court concluded that the district court did not err in finding that the claim did not accrue until 2004 (either at the time of Arroyo’s second birth or the time of the television commercial). The only information the hospital provided in 2003 was the biological cause of the injury. There is no evidence that the Arroyos knew that there was potential malpractice. The Court also concluded the district court did not err in concluding that a reasonably diligent person would also not have known to pursue a deeper inquiry in 2003. The Court rejected the government's position that any individual injured while under the care of a medical professional should assume some fault on the part of that professional.

Judge Posner wrote a separate concurrence. He agreed with the panel opinion in its entirety. In his concurrence, he addressed two questions that were not, and did not have to be, decided by the panel -- the characteristics of the objective "reasonable person" in deciding whether a plaintiff should have discovered his injury and the duty of a medical provider to be more candid with its patients.

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BODUM USA v. LA CAFETIERE, INC. (September 2, 2010)

In 1991, Bodum Holding purchased the stock of a French company whose principal product was a french-press coffeemaker sold under the name “Chambord.” One of the principal investors in the French company also owned Household, a British company that sold a very similar looking French-press coffeemaker under the “La Cafetiere” name. The parties negotiated over Household's ability to continue selling its coffeemaker after the sale. An early draft of the sales agreement allowed it to sell the La Cafetiere only in England. The later, signed version allowed it to sell the La Cafetiere anywhere in the world except France. In 2006, Household began distributing the La Cafetiere in the United States. Bodum filed suit under state and federal law. Judge Kennelly (N.D. Ill.) granted summary judgment to Household. Bodum appeals.

In their opinion, Chief Judge Easterbrook and Judges Posner (concurring) and Wood (concurring) affirmed. The only issue the Court addressed was the meaning of the contract, which was governed by French law. Although FRCP 44.1 allows the use of expert testimony as an aid to the interpretation of foreign law, the Court criticized the practice. Instead, it noted its preference for treatises. Here, the Court relied on the plain language of the contract and its "straightforward" negotiation history in concluding that Household was within its rights to sell its product in the United States. It rejected Bodum's argument that a provision in the French Civil Code required a trial to determine the actual intent of the parties.

Judge Posner agreed with the disposition on the merits but wrote a separate concurrence even more critical than Chief Judge Easterbrook of the practice of using experts to aid the court in foreign law interpretation. In his judgment, courts should rarely rely on expert testimony for the meaning of foreign law. Judge Posner has expressed this view in the past, as well (see his opinion in Sunstar, Inc. v. Alberto-Culver Co. - and my post).

Judge Wood also agreed with the disposition of the case on the merits and also wrote separately on the subject of Rule 44.1. Judge Wood, however, disagreed with the harsh criticism from her colleagues. In her judgment, experts are frequently necessary to ensure that a district court judge completely understands the nuances of foreign law.

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INDIANA PROTECTION AND ADVOCACY SERVICES v. INDIANA FAMILY AND SOCIAL SERVICES ADMINISTRATION (April 22, 2010)

In 1986, Congress enacted the Protection and Advocacy for Individuals with Mental Illness Act (the "Act"). The general purpose of the Act was to protect the rights of individuals with mental illnesses and specifically to assist states in operating protection and advocacy systems for those individuals. States are entitled to federal funds if they create such a protection and advocacy system. The system can be either a private entity or an independent state agency. Indiana created Indiana Protection and Advocacy Services ("Services"), an independent agency. The Act gives Services the authority to investigate instances of abuse and requires that Services have access to patient records. In 2006, Services opened investigations into two instances of possible abuse or neglect at the LaRue Carter Memorial Hospital. LaRue Carter is a psychiatric hospital operated by the Indiana Family and Social Services Administration ("FSSA"). In both investigations, Carter withheld patient records requested by Services. Services brought an action against the State of Indiana, FSSA, and three state officials in their official capacities. The complaint sought only injunctive and declaratory relief. The district court granted the relief. A panel of the Seventh Circuit reversed. The panel concluded that Services did not have a private right of action under the Act, could not sue under § 1983 because it was not a "person" under that section, and that the Eleventh Amendment barred the suit. Services sought rehearing en banc.

In their opinion, Chief Judge Easterbrook (dissenting) and Judges Posner (concurring), Flaum, Kanne, Rovner, Wood, Williams, Sykes, and Hamilton affirmed the judgment of the district court as modified to provide relief only against the named state officials. The Court first held that the Eleventh Amendment did not bar the suit. Although that amendment typically prevents a state or its agencies and officials from being sued in federal court by its own citizens, there are exceptions. Under the Ex parte Young exception, a state official who violates a federal law is considered to be acting outside his or her authority and not immune from suit. The required inquiry is whether the complaint seeks prospective relief for an ongoing violation of federal law. The Court found that inquiry satisfied with respect to the individually named state officials, although not with respect to the state and FSSA. Next, the Court concluded that the Act authorized Services’ suit. The Court undertook an analysis of whether Congress intended to create a private right and private remedy in the Act. Citing several provisions of the Act and interpreting the language, structure and purpose of the Act, the Court concluded that Congress did create a private right of action for access to patient records for protection and advocacy systems such as Services. In doing so, it rejected the defendants' arguments that the Act is simply an exercise of Congress's spending power, that the obligation to provide access to patient records is simply a condition inherent in accepting federal funding, and that the only remedy for the violation is to cut off the funding. Finally, on the merits, the Court had little difficulty in rejecting defendants' argument that the peer review records sought by Services were not "records" under the Act. It simply adopted the unanimous treatment given the question by the four circuits that have addressed the issue.

Judge Posner joined the Court's opinion "without reservation" but wrote separately on whether the Act provided a private cause of action. He wrote of several practical considerations that he believed supported the conclusion that the Act contained a private right of action.

Chief Judge Easterbrook dissented. Although he agreed with the conclusion that the Ex parte Young exception to Eleventh Amendment immunity applied, he disagreed with the conclusion that Services had a private cause of action. With respect to § 1983, Services is not a "person" and therefore cannot sue under that section. With respect to the Act itself, Chief Judge Easterbrook concluded that the Supreme Court's cases do not support the conclusion that a right of action can be implied in the Act.

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