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

WILLIAMS v. ADAMS (September 23, 2011,)

Bruce Williams brought a § 1983 lawsuit against several police officers, claiming he was arrested without probable cause and assaulted. Williams brought the suit pro se and proceeded in forma pauperis. After he received a draft pretrial order from the defendants, Williams hired an attorney. For months, however, the attorney failed to respond to the defendants’ draft order. The defendants moved for dismissal and sanctions. After Williams' attorney responded to the order, the defendants withdrew their dismissal request but continued to press for sanctions. A magistrate judge, after two hearings, concluded that Williams and his attorney (who, by that time, had withdrawn from the case) were jointly liable for sanctions in excess of $9,000. Defendants rejected Williams' proposed payment plan and, after five months had passed, moved for dismissal. Judge Andersen (N.D. Ill.) granted the motion and dismissed the case. Williams appeals.

In their opinion, Seventh Circuit Judges Posner, Rovner, and Wood reversed and remanded. Sanctions imposed by a district court must be proportionate to the wrong. Here, Williams had little ability to pay but did have a lawsuit with enough merit that he was about to proceed to trial against the police officer defendants. He also complained to the Illinois Attorney Registration and Disciplinary Commission about his attorney's conduct. As a result, his attorney was suspended from practicing law for a short time and ordered to pay the sanctions, which he did. Under these circumstances, the dismissal of the complaint was an unreasonable sanction.

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LINDQUIST FORD v. MIDDLETON MOTORS (September 13, 2011)

Middleton Motors, a Ford dealership near Madison, Wisconsin, was experiencing financial difficulties in 2002. It began discussing arrangements with Lindquist Ford, an Iowa dealership. Middleton wanted both daily management help and an infusion of cash. Discussions continued into 2003, when the dealerships signed a confidentiality agreement and also agreed not to hold the other liable in the absence of a written agreement. The parties never consummated a written agreement and Lindquist never invested any funds. Nevertheless, Craig Miller, Lindquist's general manager, took over Middleton's management in April of 2003. He remained in that capacity until Middleton terminated the relationship in March of 2004. When Middleton refused to compensate Lindquist, Lindquist brought suit for breach of contract, promissory estoppel, quantum meruit, and unjust enrichment. The district court granted summary judgment to Middleton on the contract and promissory estoppel claims but, after a bench trial, awarded $160,000 to Lindquist on the unjust enrichment and quantum meruit claims. The Seventh Circuit reversed and remanded (opinion here and intheiropinion here) for a new trial. On remand, Judge Crabb (W.D. Wis.) again found for Lindquist and awarded approximately the same amount. Middleton appeals.

In their opinion, Chief Judge Easterbrook and Judges Sykes and Tinder remanded with instructions to enter judgment for Middleton. The Court noted that both unjust enrichment and quantum meruit under Wisconsin law contain an equitable element. When it remanded the first appeal, it identified as the only remaining issue whether Lindquist's compensation expectation was equitably reasonable, considering the parties' course of conduct. If Lindquist expected to be paid only if Miller was successful and he was not, but was given a chance to be, then Lindquist should not be compensated. The negotiation record between the parties clearly establishes that Lindquist did not expect to be paid unless the Middleton dealership became profitable. Although the district court found that Lindquist did make the dealership profitable, the Court concluded that it erred in doing so. That conclusion is simply unsupported by the evidence. Therefore, Lindquist can only recover if Miller was not given a chance to make the dealership profitable. The district court concluded that he was not. Again, however, the Court concluded that the district court's findings were clearly erroneous and that Middleton did not prevent Miller from making the dealership profitable. Judgment should have been entered for Middleton.

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ORTIZ v. CITY OF CHICAGO (August 25, 2011)

Acting pursuant to a confidential tip, the Chicago Police raided May Molina's apartment. They placed Molina under arrest. Molina happens to be a local civil rights activist and a harsh critic of police practices. Molina also suffers from diabetes, hypertension, and a thyroid condition. She takes medications for those conditions. Pursuant to department policy, she was not allowed to take her medication into the lockup. Molina died after approximately 27 hours of confinement. Her estate brought suit against a number of police officers involved in her detention pursuant to § 1983, alleging constitutionally inadequate medical care and an unreasonable delay in providing her a probable cause hearing. Judge Grady (N.D. Ill.) excluded the estate's expert witness and granted summary judgment to the defendants on both claims. The estate appeals.

In their opinion, Seventh Circuit Judges Rovner, Wood, and Evans (who, as a result of his death, took no part in the decision) affirmed in part and reversed and remanded in part. The Court first addressed the inadequate medical care count. It pointed out that, since Molina had not yet had a probable cause hearing, her estate’s claim was governed by the Fourth Amendment reasonableness standard and not the Eight Amendment deliberate indifference standard. Since the defendants did not argue burdensomeness or police interest, the only reasonableness factors at issue are whether each individual defendant was on notice of a serious medical condition and causation. With respect to notice, the Court identified the allegations with respect to each individual defendant and concluded, in each case, that the allegations created genuine issues of fact. Considering the evidence in the light most favorable to Molina, each individual defendants either heard her ask for medical attention, heard her cry for help, were told by her lawyer that she needed to be hospitalized, or received numerous telephone calls from friends and relatives advising that she needed her medication. Therefore, the Court concluded that each was on notice of her serious medical condition. With respect to causation, the question is whether, had the defendants responded and taken her to the hospital, she would not have died or suffered pain and suffering. The district court applied too narrow a test when it required the estate to prove that it was the failure to provide her medication that caused her death. Because the defendants' expert testified that she died from an overdose of drugs she ingested at the time of the police raid, and because the district court excluded the estate’s expert testimony that she died because she was not giving her medication, the district court concluded that the estate failed to prove causation. But the estate did not need to prove that it was the lack of medication -- it only needed to prove that it was the failure to take her to the hospital. The Court therefore concluded that the expert testimony was not even required on that point. There was enough lay testimony in the record to establish causation. The Court also found the district court improperly excluded the expert testimony because of its misunderstanding of the factual record. With respect to the defendants' qualified immunity claim, the Court had no difficulty concluding that failing to provide medical care to a prisoner with a serious health risk satisfied the estate’s burden (without deciding whether it should apply the deliberate indifference or objectively unreasonable standard). On the unreasonable delay count, the Court agreed with the district court. The Supreme Court adopted a 48-hour burden shifting rule in Gerstein. Therefore, this 27-hour detention is presumptively reasonable. The estate failed to overcome the presumption.

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SILIVEN v. INDIANA DEPARTMENT OF CHILD SERVICES (March 16, 2011)

Teresa and Mark Siliven’s two-year-old son had been in daycare with Ashley Woods for almost a year. When Teresa picked him up one day in January 2008, Woods told her that the boy had been acting up. Later that evening, Teresa noticed bruises on her son's arm. Mark said he knew nothing about them, so they filed a child-abuse report with the Richmond, Indiana Police Department. The report was forwarded to the Indiana Department of Child Services(DCS). DCS caseworker Amber Luedike investigated. She interviewed Mark and Teresa, as well as Woods. Luedike also asked the Siliven’s to take their son to the emergency room for an examination. Although the emergency room report reached no conclusion as to the cause of the bruises, another doctor to whom Luedike showed the bruises opined that they were consistent with an adult grabbing the boy's arm. Six days into her investigation, Luedike learned that the DCS had substantiated an incident of child abuse involving Mark and his 15-year-old stepdaughter five years earlier. Luedike met with her supervisor, a staff attorney, and a DCS director. She recommended that DCS remove the boy from his home. She based her recommendation on the likelihood that he had been injured by an adult, the fact that the parents had not been eliminated as the cause, and Mark’s earlier incident. The others agreed, and also agreed that they should remove him on an emergency basis because they would be unable to obtain a court order before the upcoming weekend. Luedike and several sheriff’s deputies went to the Siliven's home, intending to take the boy into protective custody. The DCS director eventually agreed, however, to allow Teresa to take the boy to his grandmother's home in Ohio. The following Monday, a judge concluded that probable cause to believe that the boy’s physical health was seriously endangered did not exist. DCS closed its investigation. The Silivens filed suit against Luedike and the DCS director, alleging federal Constitutional and state law violations. Judge Lawrence (S.D. Ind.) granted summary judgment to the defendants based on qualified immunity. He did not address whether there was a constitutional violation but, under the second prong of the qualified immunity test, held that the constitutional rights allegedly violated were not clearly established at the time of the conduct. The Silivens appeal.

In their opinion, Judges Flaum, Manion, and Evans affirmed. The Court’s two-part test is familiar: whether the complaint alleges a constitutional violation and whether the rights allegedly violated were clearly established at the time of the conduct. Unlike the district court, which ignored the first prong and found the second prong dispositive, the Court started with the first prong and found it dispositive. With respect to the Fourth Amendment unreasonable seizure claim, the Court assumed without deciding that there was a seizure (remember that the boy never left his mother's side) but concluded that the defendants' acts were reasonable under an objective test. There was physical evidence of abuse, Mark had access to the boy, and the DCS had substantiated an earlier abuse claim against Mark. Those facts, particularly combined with the fact that the boy remained with his mother at all times, were enough for the Court to find reasonableness. With respect to the substantive due process claim, the Court noted that the constitutional right to familial integrity has to be balanced against the public interest in child safety. A caseworker need only have reasonable suspicion of past or threatened abuse to take a child into custody. Since that threshold is less demanding than the Fourth Amendment threshold the Court already discussed, the Court had no difficulty in concluding that there was no substantive due process violation. Finally, the Siliven's also alleged a procedural due process violation. Due process does require a pre-deprivation hearing before a child is removed from his home, unless there are exigent circumstances. This also requires an objective test, whether a reasonable caseworker would have believed the child was in immediate danger. Again, that test is less stringent than the Fourth Amendment test. The Court concluded that the defendants met the test.

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JOHNSON v. MANITOWOC COUNTY (March 10, 2011)

Steven Avery was convicted of rape in Wisconsin state court in 1986. After serving 18 years in jail, he was released in 2003 after DNA evidence suggested that he did not commit the crime. He filed a multi-million dollar lawsuit against Manitowoc County authorities. Avery lived in a trailer and garage rented  from Roland Johnson. A few years after his release, a magazine photographer disappeared after meeting with Avery on Johnson's property. An investigation ensued, with Avery a prime suspect. Several search warrants were executed at the trailer and garage. During the searches, the investigators broke up a portion of the concrete garage floor with a jackhammer, damaged the garage door, and damaged the trailer. They also seized a number of personal items. Johnson brought suit against County officials under § 1983, alleging violations of the Fourth, Fifth, and Fourteenth amendments. Judge Randa (E.D. Wis.) granted summary judgment to the defendants. Johnson appeals.

In their opinion, Judges Flaum, Rovner, and Evans affirmed. The Court first considered Johnson's argument that the use of the jackhammers violated the Fourth Amendment. The Fourth Amendment requires reasonableness, and measures it under the totality of the circumstances. The Court rejected Johnson' argument that the availability of a less invasive tool made the use of the jackhammers unreasonable. The Fourth Amendment does not require the least destructive approach to the execution of a search warrant. The Court concluded that the use of the jackhammers was reasonable under the circumstances. The Court turned to Johnson's claim that the Fifth Amendment Takings Clause entitles him to compensation. But the Takings Clause does not apply when the "taking" results from a government power other than the power of eminent domain. Here, any property seized or destroyed by government authorities was done so under its police power. The Court did note that Johnson may have some state remedies, both for compensation for damages and the return of his property – but he does not have a federal constitutional claim.

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JACKSON v. PARKER (December 3, 2010)

On a spring afternoon in 2006, Wayne Jackson was southbound on Chicago’s Lake Shore Drive ("Urban America's Most Beautiful Roadway") in his pickup truck. Unfortunately, his truck was licensed as a commercial vehicle and therefore prohibited on the Drive. Chicago police officer Joe Parker noticed the plates and also observed Jackson making two illegal lane changes. Parker stopped Jackson's car and then observed a windshield crack, another ordinance violation. He also administered field sobriety tests and a breathalyzer, which he claims Jackson failed. Jackson was released after approximately 12 hours at the police station. Although his arrest report lists DUI, the prosecutor later amended the charge to negligent driving. At trial, Jackson was found guilty of improper lane usage and failing to notify the state of an address change and was found not guilty of negligent driving and driving an unsafe vehicle charges. Jackson brought a § 1983 charge against Parker, claiming a Fourth Amendment false arrest violation. Jackson claimed that Parker falsified the DUI test results. He also presented evidence that Parker regularly reported such false information as part of a scheme to increase his compensation and that he was being internally investigated for his conduct. Judge Conlon (N.D. Ill.) granted summary judgment to Parker, concluding that the unlawful lane change provided sufficient probable cause for the arrest. In the face of that probable cause, Jackson could not prevail whether or not there was probable cause for a DUI arrest. Jackson appeals.

In their opinion, Seventh Circuit Chief Judge Easterbrook and Judges Posner and Tinder affirmed. The Court agreed with the district court and noted that Jackson implicitly agreed as well. Parker had reason to believe that Jackson was violating the law by even being on the roadway in a commercial vehicle. Even though he was never charged with that offense, and even if he had an illicit motivation, the arrest is reasonable. Apparently recognizing that his false arrest claim was not going to survive the appeal, Jackson's counsel reconstituted his argument as a unreasonable detention rather than a false arrest. Unfortunately for Jackson, arguments that are not presented to the district court are normally forfeited on appeal unless the interests of justice require otherwise. The Court concluded that this was not such a case.

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HAYES LEMMERZ INTERNATIONAL v. ACE AMERICAN INSURANCE CO. (August 31, 2010)

An explosion at a plant owned by Hayes Lemmerz International-Huntington (LMIH) , a subsidiary of Hayes Lemmerz International (HLI), injured one employee and killed another. The injured employee and the widow of the deceased employee filed workers' compensation claims against both HLI and HLIH as employers and recovered. They then brought a tort suit against the same two companies. The suit did not identify either defendant as an employer. Rather, it alleged that the defendants owned and operated the plant and failed to exercise reasonable care. Apparently, they did not identify the defendants as employers because the exclusive remedy against an employer for a workplace injury is a workers’ compensation claim. HLI notified ACE American Insurance Co., its employer liability policy carrier. ACE declined to take over the defense and offered to pay only half the combined litigation expenses. HLI incurred over $250,000 in defense costs attempting to convince the state court that it was not the employer -- and therefore not liable. Ironically, it eventually discovered that Indiana, by statute, treats a parent and its subsidiaries as joint employers, for workers' compensation purposes, of each other's employees. The suit against HLI was therefore dismissed with prejudice because of the workers' compensation bar. HLI brought an action against ACE for recovery of its attorneys' fees. Chief Judge Simon (N.D. Ind.) dismissed the complaint. HLI appeals.

In their opinion, Judges Bauer, Posner, and Flaum affirmed. Under Indiana law, the duty to defend is determined by the nature of the complaint. The "nature of the complaint" includes not only the specific allegations contained therein but also facts readily ascertainable by the insurer. Here, although neither HLI nor HLIH were identified as employers in the complaint, the Indiana statute made their status as such readily ascertainable. The fact that the complaint lacked merit is irrelevant -- an insured deserves a defense to meritless complaints as well as meritorious ones. A duty to defend (or reimburse) therefore existed. However, that duty requires reimbursement only of reasonable costs of defense. HLI's failure to appreciate the existence and significance of the Indiana statute (HLI has filed a malpractice action against its lawyers) led the Court to conclude that the defense costs were unreasonable and unrecoverable. The Court also rejected HLI's argument that ACE's duty to defend included a duty to advise it about the existence of the statute. ACE had no duty to provide legal advice.

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PORTIS v. CITY OF CHICAGO (July 23, 2010)

The City of Chicago arrests thousands of individuals each year for crimes punishable only by monetary fines. These crimes include disorderly conduct, peddling, and minor traffic offenses, among others. The police procedure after such arrests is to confirm the identity of the individual, the existence of probable cause, and that the individual is not wanted for a more serious offense. At that point in the process, an individual is entitled to be released on a personal-recognizance bond. All that remains is the bond’s processing and approval and the return of any personal belongings that were taken upon the arrest. The individual is then released. A number of persons who were subjected to this process brought a class action against the City. They allege that if the period of time between the entitlement to release and the actual release exceeds two hours, the confinement is unreasonable and in violation of the Fourth Amendment. Judge Gettleman (N.D. Ill.) agreed and certified the question for appeal. The City appeals.

In their opinion, Chief Judge Easterbrook and Judges Bauer and Evans accepted the appeal -- and reversed and remanded. The Court compared the district court's ruling with the Supreme Court's decision in McLaughlin. In that case, the Supreme Court adopted a 48-hour test for the reasonableness of the period between arrest and presentation to a magistrate. That test differed in two ways from the district court's test: first, it looked at the entire process between arrest and presentation rather than one phase of the process -- and second, the 48-hour test was a presumption rather than a bright line rule. McLaughlin specifically rejected the adoption of arbitrary bright lines by courts -- only a legislature should venture there. The reasonableness of a detention should be decided as a whole -- not with relation to its component parts -- and should be decided individually -- not as a class. So not only did the Court find error in the lower court's decision on the merits, it also directed the district court to decertify the class. The named plaintiffs may still proceed individually with their claims that their detention was unreasonable.

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MAJESKI v. METROPOLITAN LIFE INSURANCE CO. (December 29, 2009)

Kirsten Majeski was a nurse consultant for Metropolitan Life Insurance Co. ("MetLife"). Her typical workday involved sitting at a desk, using a phone and computer. In 2006, she was diagnosed with cervical radiculitis, a compression in the upper spinal. MetLife originally approved short-term disability benefits. It later determined that Majeski was not entitled to benefits, concluding that her impairment did not prevent her from performing her job. Majeski appealed and submitted medical evidence from her doctor and physical therapist. The conclusion of the medical evidence was that she had difficulty sitting and using her hands -- and was thus unable to perform her job. MetLife had a physician review the records. He concluded that there were "minimal objective findings" to support the suggested limitations. MetLife rejected the appeal. Majeski brought suit under ERISA. The district court granted summary judgment to MetLife. Majeski appeals.

In their opinion, Judges Wood, Evans and Tinder vacated and remanded. The Court first rejected Majeski's argument that the Supreme Court's decision in Glenn required a heightened standard of review. The Court admitted that it was still undecided on how to weigh a Plan administrator's conflict of interest. In Marrs, the Court concluded that the circumstances of the case should determine the impact of the conflict. The Court also rejected Majeski's argument that the district court should have considered evidence outside of the administrative record. On the merits, however, the Court agreed with Majeski. The physician's report on which MetLife solely relies did not address key findings presented by Majeski's medical evidence. Although the report concludes that there were "minimal objective findings," the Court cited several objective findings contained in Majeski's material that MetLife physician failed to mention or rebut. The failure to address this significant medical evidence amounts to an absence of reasoning and lack of fair review. The Court declined to rule directly in Majeski's favor, concluding that the typical and proper course is to remand to the plan administrator.

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ANDERSON v. AB PAINTING AND SANDBLASTING (August 20, 2009)

Under its collective bargaining agreement, AB Painting and Sandblasting was required to make contributions to several union benefit plans. The trustee of the plans brought an action under ERISA to collect overdue contributions. The court granted summary judgment to the fund for the entire amount claimed ($6,500). The court awarded attorneys’ fees of only $10,000, however, on a request in excess of $50,000. The amount claimed, stated the district court, was “disproportionate” to the amount at stake. The trustee appealed.

In their opinion, Judges Bauer, Manion and Sykes reversed and remanded. The Court noted that ERISA requires an award of “reasonable” attorneys’ fees in a successful action to recover overdue contributions. The district court should begin with the “lodestar” (hours times a reasonable rate)and adjust it upon consideration of a number of factors, including the amount at stake and the results obtained. The Court cited its own jurisprudence, however, where it has rejected any requirement of proportionality between the result and the fee award. In fact, one of the policy reasons behind fee-shifting statutes is the promotion of meritorious claims that would not be brought otherwise. In a situation where Congress has spoken by including a fee-shifting provision in a statute, a court should only look at whether the time expended was a reasonable approach to the desired end. Here, the lower court did not opine on the reasonableness of the hours spent achieving the outcome. The Court remanded for such a recalculation.

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