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The e-Journal provides summaries of all opinions as they are released from the Michigan Supreme Court, Michigan Court of Appeals (published and unpublished), and the U.S. Sixth Circuit Court of Appeals (published).

Case Summaries           e-Mail to a Friend Printer Friendly Version

Cases appear under the following practice areas:


Civil Rights

 

This summary also appears under Employment & Labor Law

 

Issues: Civil rights claims; 42 USC § 1983; Middlesex Cnty. Sewerage Auth. v. National Sea Clammers Ass'n; Rancho Palos Verdes v. Abrams; The Clammers/Rancho Palos Verdes doctrine; Family Medical Leave Act (FMLA) family-care provision; 29 USC § 2612(a)(1)(C); Nevada Dep't of Human Res. v. Hibbs; Self-care provision; Touvell v. Ohio Dep't of Mental Retardation & Developmental Disabilities; Steers v. Michigan; "Sovereign immunity"; Coleman v. Court of Appeals of MD; Whether public employers can be held individually liable under the FMLA; Mitchell v. Chapman; Wascura v. Carver (11th Cir.); Darby v. Bratch (8th Cir.); Modica v. Taylor; Alternative redress; Ex parte Young exception to sovereign immunity; MacDonald v. Village of Northport, MI; Pennhurst State Sch. & Hosp. v. Halderman; Carten v. Kent State Univ.; Turker v. Ohio Dep't of Rehab. & Corrs.; Verizon MD, Inc. v. Public Serv. Comm'n of MD; Seminole Tribe of FL v. Florida; Green v. Mansour

Court: U.S. Court of Appeals Sixth Circuit

Case Name: Diaz v. Michigan Dep't of Corrs.

e-Journal Number: 53643

Judge(s): Marbley, Rogers, and Kethledge

 

The court held that the district court properly dismissed plaintiffs' FMLA claims brought under § 1983, but found that the district court erred in dismissing plaintiff-Diaz's claim for reinstatement. Plaintiffs-Ricardo Diaz and Connie Boden sued their employers, defendants-Michigan Department of Corrections and Michigan Department of Human Services and others, under § 1983, alleging, inter alia, that they were retaliated against for exercising their rights under the FMLA. The district court dismissed all claims. On appeal, the court rejected plaintiffs' argument that they have a right to self-care leave under the FMLA, but that Touvell left them a "right without a remedy." The court held that plaintiffs did not have the right to bring suit for monetary damages against their state officials under the self-care provision of the FMLA, noting that they cannot circumvent sovereign immunity by bringing § 1983 "and laws" suits. However, the court agreed with Diaz's argument that he may be able to seek prospective relief against state officials, in their official capacity, in the form of reinstatement to his position, through Ex parte Young. The court held that the district court erred when it dismissed Diaz's claim for equitable, prospective relief in the form of reinstatement. It noted that the appropriate inquiry on remand is whether Diaz sufficiently alleged an ongoing violation of federal law to maintain his equitable claim. Affirmed in part, reversed in part, and remanded.

 


Criminal Law

 

Issues: Confidentiality of medical records; People v. Fink; People v. Babcock; MCL 330.1750(1); "Patient's privilege"; People v. Stanaway; Whether the records were "necessary" to the defense

Court: Michigan Court of Appeals (Unpublished)

Case Name: People v. Clark

e-Journal Number: 53694

Judge(s): Per Curiam – Whitbeck, Saad, and Shapiro

 

In this case where the defendant was convicted of 10 counts of CSC, because the victims' medical records did not contain significant new information and the defendant was able to elicit the information he sought on cross-examination, the court was not convinced that access to the records would have made a different result reasonably probable. The court held that the trial court did not abuse its discretion because its ruling that defendant did not make the necessary showing to warrant an in camera review was not an outcome outside of the range of reasonable and principled outcomes. The prosecution charged defendant with sexually assaulting his adopted granddaughter when she was between the ages of 13 and 21, and sexually assaulting the adopted daughter of one on his former foster children when she was between the ages of 12 and 18. Both victims were placed in foster care after relatives sexually abused them. Defendant indicated that he wanted to introduce evidence of their childhood medical diagnoses and treatments, and moved the trial court for an in camera review of their medical and counseling records. He attached affidavits of the victims' mothers to his materials in which they indicated that they were aware that the victims were diagnosed with PTSD as children and that their symptoms improved during the time in which defendant was allegedly sexually abusing them. He argued that the information was relevant to show the abuse did not happen, inter alia. The trial court denied his motion. Defendant argued that he could not call the mothers because they were the subject of ongoing neglect proceedings. After the trial court denied his motion, and the parties could not reach an agreement to limit the scope of the mothers' testimony, he did not call the mothers or his expert witness. The trial court refused to conduct the in camera review of the medical records because it ruled that he did not make the necessary showing to warrant review of the records. The court concluded that defendant did not show that information in the records was material information necessary to the defense. Affirmed.

 


Issues: Whether the evidence was sufficient to convict defendant of armed robbery; People v. Ericksen; People v. Riley (After Remand); People v. Harverson; People v. Bennett; People v. Kissner; Evidence of aiding and abetting; People v. Smith; People v. Bulls; People v. Robinson; Prosecutorial misconduct; People v. Brown; People v. Callon; People v. Buckey; People v. Ackerman

Court: Michigan Court of Appeals (Unpublished)

Case Name: People v. McCoy

e-Journal Number: 53724

Judge(s): Per Curaim - Donofrio, Fort Hood, and Servitto

 

The court held that the evidence was sufficient to support the defendant's conviction of armed robbery, the prosecutor did not commit misconduct, and defense counsel was not ineffective. Thus, the court affirmed his conviction. His conviction arose from the armed robbery of a pet store. Defendant argued, inter alia, that the prosecutor failed to present sufficient evidence that he aided and abetted S in committing the armed robbery. He and S arrived at the pet store together both times and left together. Before the robbery, they were together at all times in the store. Surveillance cameras from the store confirmed this. The owner of the store testified that defendant and S appeared to have been in each other's company and seemed to be casing the store and seeing where employees were located in the store. After defendant brought a bag of dog food to the cash register, defendant and S argued who was going to pay for the dog food before S pointed a gun at the cashier and demanded that she hand over the money. Defendant also lied to the police and denied he had been in the store. Thus, the evidence was sufficient for a rational jury to reject defendant's argument that he was a mere uninvolved bystander and conclude that he aided and abetted S in the plan to rob the pet store. The court also held that the other issues he raised on appeal had no merit and affirmed his conviction and sentence.

 


Issues: Motion to suppress the defendant's police statement and a video reenactment in which he participated; Whether defendant was "in custody"; Miranda v. Arizona; People v. Roberts; People v. Herndon; People v. Mendez; People v. Zahn; Stansbury v. California; Howes v. Fields; An individual's prior experience with law enforcement; Yarborough v. Alvarado; Consideration of defendant's age; JDB v. North Carolina; Whether defendant's statements were "involuntary"; People v. Cipriano; People v. Conte; Department of Human Services (DHS)

Court: Michigan Court of Appeals (Unpublished)

Case Name: People v. McCullough

e-Journal Number: 53737

Judge(s): Per Curiam – Hoekstra, K.F. Kelly, and Beckering

 

Holding that the defendant could not have reasonably believed that he was in custody when he made his police statement or when he participated in a videotaped reenactment of the incident, the court concluded that the trial court erred in granting his motion to suppress on the basis that the police failed to read him his Miranda warnings. He was charged with felony murder, three counts of first-degree child abuse, and one count of second-degree child abuse related to the death of his live-in girlfriend's (SB) 16-month old son (D). The case involved two separate statements - the first made in the police department's Child Abuse Unit's offices and the second in a videotaped reenactment taken at the home of SB's mother (G), where defendant lived with SB and D. In determining that defendant was in custody, the trial court considered his age, education, and experience with law enforcement. The trial court also focused on the purpose of the questioning. The court held that the fact defendant was suspected of wrongdoing was not a proper consideration. Further, "while an individual's prior experience with law enforcement may be relevant in determining whether a statement was voluntary, it is an improper consideration for ascertaining whether an individual reasonably believed he was in custody." Also, since defendant was 18 years old when he made the statements, he clearly was not a child and the trial court improperly considered his age. The court concluded that considering the proper factors, the facts did "not show that defendant's movement was so restrained that it was comparable to a formal arrest" or that his "freedom was deprived in any significant manner." He had his own ride to the Unit offices, which were located in a DHS building. "The building is not a police station and does not have a detention center." The officers there wear plain clothes and other workers were in the area. Defendant was interviewed by officer B in B's cubicle. The interview lasted only 50 minutes and when it ended, defendant was free to leave. B asked him general questions and gave him the chance to read over his responses and correct any mistakes. While defendant was emotional, he was also responsive. He never asked to leave or said that he did not want to talk. At the end of the interview, defendant, SB, and G left. The court also concluded that the facts did not "show that defendant's movement during the videotaped reenactment was so restrained that it was comparable to a formal arrest." An interrogation in a suspect's home is usually viewed as noncustodial, several other people were in the home, and the reenactment was planned. The court also held that defendant's statements were voluntary. Reversed and remanded.

 


Employment & Labor Law

 

This summary also appears under Civil Rights

 

Issues: Civil rights claims; 42 USC § 1983; Middlesex Cnty. Sewerage Auth. v. National Sea Clammers Ass'n; Rancho Palos Verdes v. Abrams; The Clammers/Rancho Palos Verdes doctrine; Family Medical Leave Act (FMLA) family-care provision; 29 USC § 2612(a)(1)(C); Nevada Dep't of Human Res. v. Hibbs; Self-care provision; Touvell v. Ohio Dep't of Mental Retardation & Developmental Disabilities; Steers v. Michigan; "Sovereign immunity"; Coleman v. Court of Appeals of MD; Whether public employers can be held individually liable under the FMLA; Mitchell v. Chapman; Wascura v. Carver (11th Cir.); Darby v. Bratch (8th Cir.); Modica v. Taylor; Alternative redress; Ex parte Young exception to sovereign immunity; MacDonald v. Village of Northport, MI; Pennhurst State Sch. & Hosp. v. Halderman; Carten v. Kent State Univ.; Turker v. Ohio Dep't of Rehab. & Corrs.; Verizon MD, Inc. v. Public Serv. Comm'n of MD; Seminole Tribe of FL v. Florida; Green v. Mansour

Court: U.S. Court of Appeals Sixth Circuit

Case Name: Diaz v. Michigan Dep't of Corrs.

e-Journal Number: 53643

Judge(s): Marbley, Rogers, and Kethledge

 

The court held that the district court properly dismissed plaintiffs' FMLA claims brought under § 1983, but found that the district court erred in dismissing plaintiff-Diaz's claim for reinstatement. Plaintiffs-Ricardo Diaz and Connie Boden sued their employers, defendants-Michigan Department of Corrections and Michigan Department of Human Services and others, under § 1983, alleging, inter alia, that they were retaliated against for exercising their rights under the FMLA. The district court dismissed all claims. On appeal, the court rejected plaintiffs' argument that they have a right to self-care leave under the FMLA, but that Touvell left them a "right without a remedy." The court held that plaintiffs did not have the right to bring suit for monetary damages against their state officials under the self-care provision of the FMLA, noting that they cannot circumvent sovereign immunity by bringing § 1983 "and laws" suits. However, the court agreed with Diaz's argument that he may be able to seek prospective relief against state officials, in their official capacity, in the form of reinstatement to his position, through Ex parte Young. The court held that the district court erred when it dismissed Diaz's claim for equitable, prospective relief in the form of reinstatement. It noted that the appropriate inquiry on remand is whether Diaz sufficiently alleged an ongoing violation of federal law to maintain his equitable claim. Affirmed in part, reversed in part, and remanded.

 


Insurance

 

Issues: The No-Fault Act (MCL 500.3101 et seq.); Claim that the defendant-insurer (Allstate) was higher in priority than the plaintiff-insurer (Farm Bureau) under MCL 500.3114 and 500.3115 to pay PIP benefits to an injured pedestrian; Meaning of the term "the claimant" in MCL 500.3175(3); Lakeland Neurocare Ctrs. v. State Farm Mut. Auto. Ins. Co.; Effect of the use of "the" instead of "a"; Robinson v. Detroit; Applicability of the "one-year-back rule" in MCL 500.3145(1); Allen v. Farm Bureau Ins. Co.; Statutory interpretation; Driver v. Naini; Department of Envtl. Quality v. Worth Twp.; Assigned Claims Facility (ACF)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Farm Bureau Ins. Co. v. Chukwueke

e-Journal Number: 53723

Judge(s): Per Curiam – Donofrio, Fort Hood, and Servitto

 

The court held that the term "the claimant" in MCL 500.3175(3) includes a medical provider that provides services to an insured, and that the one "one-year-back rule" did not apply in this case, a reimbursement action. Defendant-Chukwueke owned a car that her father was driving when he struck a pedestrian, H. H filed an application for PIP benefits with the ACF, which assigned his claim to plaintiff. Plaintiff administered the claim and paid $448,693 in medical expenses on H's behalf. Plaintiff filed this action against defendant-Allstate for reimbursement of its loss adjustment costs and benefits paid. Plaintiff alleged that Allstate insured the car through a no-fault policy at the time of the accident and it was higher in priority than plaintiff to pay H's PIP benefits. The trial court granted plaintiff summary disposition and entered a judgment for plaintiff in the amount of $480,684.82. Allstate argued on appeal that the term "the claimant" in MCL 500.3175(3) refers to the injured party and that a medical provider is not included within the term. The court concluded that Allstate's argument that the term "the claimant" is synonymous with "the injured party" lacked merit. "MCL 500.3109(2) defines 'injured person' as 'a natural person suffering accidental bodily injury.' Interpreting the term 'the claimant' in MCL 500.3175(3) identical to the phrase 'injured person' would not give effect to every word in the statute and would render the term 'the claimant' mere surplusage." Noting that it has previously recognized that the terms "claimant" and "injured person" have two different meanings, the court concluded that "the claimant" refers to a party that files a claim for PIP benefits. However, "MCL 500.3175(3) states that '[a]n action to enforce rights to indemnity or reimbursement against a third party shall not be commenced after . . . 1 year after the date of the last payment to the claimant.'" Thus, "an action seeking indemnity or reimbursement may not be commenced more than one year after the date of the last payment to the particular claimant regarding which indemnity or reimbursement is sought." Since it was unclear from the record whether plaintiff filed suit within one year after the date of the last payment made to each individual claimant, the court remanded the case to the trial court for a determination on that issue. The court also held that MCL 500.3145(1), which by its terms relates to "[a]n action for recovery of [PIP] benefits," does not apply to a claim for reimbursement, which is not an action for recovery of PIP benefits. "Rather, a claim seeking reimbursement is '[a]n action to enforce rights to indemnity or reimbursement against a third party' as stated in MCL 500.3175(3)." Affirmed in part, reversed in part, and remanded.

 


This summary also appears under Litigation

 

Issues: Sanctions for failure to comply with court orders; Fed.R.Civ.P. 37(b)(2)(A); Bass v. Jostens, Inc.; United States v. Reyes; R.C. Olmstead, Inc. v. CU Interface, LLC

Court: U.S. Court of Appeals Sixth Circuit

Case Name: Universal Health Group v. Allstate Ins. Co.

e-Journal Number: 53633

Judge(s): Kethledge, Batchelder, and Merritt

 

The court held that the district court's dismissal of plaintiff's complaint as a sanction for its "willful and repeated violations" of the district court's discovery orders was appropriate. Plaintiff demanded payment from defendant for medical services plaintiff allegedly rendered to 36 persons claiming coverage under insurance policies issued by defendant. Defendant denied payment, contending plaintiff had never rendered such services. Plaintiff sued defendant for payment, defamation, and tortious interference with its business relationships. During discovery, plaintiff repeatedly missed deadlines and violated the district court's discovery orders, eventually leading to the district court's dismissal of the complaint as a sanction. On appeal, the court held that all four of the factors it considers when reviewing a district court's dismissal under Rule 37(b) were present in this case. It found that plaintiff's violations were willful, and prejudicial to defendant in its preparation of its defense. It also found that, notwithstanding plaintiff's argument that "there was no explicit warning of dismissal," plaintiff was on "clear notice" that continued abuses could cause this result. Finally, it found that "the magistrate judge's measured response to the first motion to dismiss" met the fourth factor. The court noted that even defendant's repeated motions, and the district court's orders, were not enough to compel plaintiff to do what the Rules required. The court concluded that plaintiff's "conduct violated the rules of civil procedure and common courtesy alike." As such, it concluded that dismissal was not only permissible, but salutary. Affirmed.

 


Litigation

 

This summary also appears under Qui Tam

 

Issues: Alleged violation of MCL 333.17755(2) (part of the Public Health Code (PHC) (MCL 333.17701 et seq.)); Docket No. 299997 - Whether plaintiff-Gurganus met the requirements of a proper qui tam relator under MCL 400.610a(13); MCL 400.610a(1); Statutory interpretation; Ward v. Michigan State Univ. (On Remand); "Alleging" and "transactions" defined; Whether there was a "public disclosure"; The Medicaid False Claim Act (MFCA)(MCL 400.601 et seq.); Whether the class action plaintiffs had a private cause of action pursuant to § 17755(2) or the Health Care False Claim Act (HCFCA) (MCL 752.1001 et seq.) (specifically MCL 752.1009); Chrisdiana v. Department of Cmty. Health; Brackett v. Focus Hope, Inc.; United States Fid. & Guar. Co. v. Michigan Catastrophic Claims Ass'n (On Rehearing); Robinson v. Lansing; Robinson v. Detroit; South Haven v. Van Buren Cnty. Bd. of Comm'rs; "Shall"; Isidore Steiner, DPM, PC v. Bonanni; Remedy; Pompey v. General Motors Corp.; Grand Traverse Cnty. v. Michigan; Purpose of the HCFCA; People v. Motor City Hosp. & Surgical Supply, Inc.; "Liable"; Bailey v. Oakwood Hosp. & Med Ctr.; Summary disposition under MCR 2.116(C)(8); Feyz v. Mercy Mem'l Hosp.; Dalley v. Dykema Gossett PLLC; Spelman v. Addison; Pleading fraud with particularity; Cooper v. Auto Club Ins. Ass'n; Kassab v. Michigan Basic Prop. Ins. Assoc.; Whether the heightened pleading standard in MCR 2.112(B)(1) applied; Zine v. Chrysler Corp.; Fed.R.Civ.P. 9(b); The Federal False Claims Act; Sanderson v. HCA-The Healthcare Co. (6th Cir.); United States ex rel Clausen v. Laboratory Corp. of Am., Inc. (11th Cir.); Whether the alleged violation of § 17755(2) is a "false claim" within the meaning of the HCFCA or the MFCA; Whether the complaints needed to plead facts demonstrating that a substitution transaction occurred; Securities Exchange Commission (SEC)

Court: Michigan Court of Appeals (Unpublished)

Case Name: State of Michigan ex rel Maricia Gurganus v. CVS Caremark Corp.

e-Journal Number: 53743

Judge(s): Per Curiam – M.J. Kelly, Hoekstra, and Stephens

 

Holding that the qui tam complaint was not based upon a public disclosure, the court reversed the trial court's conclusion in the qui tam action that plaintiff-Gurganus was not a proper relator. In the class action lawsuits, the court affirmed the trial court's conclusion that plaintiffs did not have a private cause of action pursuant to § 17755(2). However, because the court held MCL 752.1009 provides for a private cause of action, it reversed the trial court as to whether plaintiffs have a private cause of action pursuant to the HCFCA. Finally, because the court held that the qui tam complaint and both class action complaints satisfied the applicable pleading standards, it reversed the trial court's grant of summary disposition in favor of defendants in all three cases. The defendants in these consolidated cases operate pharmacies in Michigan. In each case, a qui tam action and two class action lawsuits, the defendants were alleged to have violated § 17755(2), which is part of the PHC and states, in pertinent part, that "[i]f a pharmacist dispenses a generically equivalent drug product, the pharmacist shall pass on the savings in cost to the purchaser or to the third party payment source if the prescription purchase is covered by a third party pay contract." Gurganus brought a qui tam action on behalf of the state alleging that defendants failed to comply with § 17755(2) when they submitted prescription drug claims for drugs dispensed to Medicaid beneficiaries to the state and failed to pass on the savings in cost obtained by the pharmacies in dispensing a generically equivalent drug. She claimed that, by doing so, defendants violated the MFCA, which specifically authorizes a qui tam action. On appeal, Gurganus argued that the trial court erred by granting summary disposition in favor of defendants on the basis that she was not a proper qui tam relator under the MFCA.The issue was whether Gurganus could meet the requirements of a proper qui tam relator under MCL 400.610a(13). She filed the qui tam complaint based upon the authorization set forth in the MFCA, which provides - "Any person may bring a civil action in the name of this state under this section to recover losses that this state suffers from a violation of [the MFCA]." However, the phrase "any person" is limited by MCL 400.610a(13). The parties' arguments revolved around whether, within the meaning of MCL 400.610a(13), a Wall Street Journal article, corporate annual reports from defendants-CVS Caremark Corporation and Walgreens, and SEC filings by defendant-Rite Aid constituted public disclosure of the allegations and transactions contained in the qui tam complaint. Thus, the court addressed whether there was a "public disclosure." The article merely discussed the fact that large corporations, such as defendants, find ways to maximize profits. It did "not even suggest that the larger profits that representatives of Walgreens and CVS claimed were made on generic drugs were realized as the result of unethical or unlawful conduct." The court held that the public disclosures upon which defendants relied did not rise to the level of disclosing any transaction on which the qui tam complaint was based.

 


This summary also appears under Insurance

 

Issues: Sanctions for failure to comply with court orders; Fed.R.Civ.P. 37(b)(2)(A); Bass v. Jostens, Inc.; United States v. Reyes; R.C. Olmstead, Inc. v. CU Interface, LLC

Court: U.S. Court of Appeals Sixth Circuit

Case Name: Universal Health Group v. Allstate Ins. Co.

e-Journal Number: 53633

Judge(s): Kethledge, Batchelder, and Merritt

 

The court held that the district court's dismissal of plaintiff's complaint as a sanction for its "willful and repeated violations" of the district court's discovery orders was appropriate. Plaintiff demanded payment from defendant for medical services plaintiff allegedly rendered to 36 persons claiming coverage under insurance policies issued by defendant. Defendant denied payment, contending plaintiff had never rendered such services. Plaintiff sued defendant for payment, defamation, and tortious interference with its business relationships. During discovery, plaintiff repeatedly missed deadlines and violated the district court's discovery orders, eventually leading to the district court's dismissal of the complaint as a sanction. On appeal, the court held that all four of the factors it considers when reviewing a district court's dismissal under Rule 37(b) were present in this case. It found that plaintiff's violations were willful, and prejudicial to defendant in its preparation of its defense. It also found that, notwithstanding plaintiff's argument that "there was no explicit warning of dismissal," plaintiff was on "clear notice" that continued abuses could cause this result. Finally, it found that "the magistrate judge's measured response to the first motion to dismiss" met the fourth factor. The court noted that even defendant's repeated motions, and the district court's orders, were not enough to compel plaintiff to do what the Rules required. The court concluded that plaintiff's "conduct violated the rules of civil procedure and common courtesy alike." As such, it concluded that dismissal was not only permissible, but salutary. Affirmed.

 


Negligence & Intentional Tort

 

Issues: Premises liability; Kennedy v. Great Atl. & Pac. Tea Co.; Duty owed to an "invitee"; Hoffner v. Lanctoe; "Actual or constructive notice" of the condition; Bertrand v. Alan Ford, Inc.; Whether the defendant breached its duty to inspect the premises; Price v. Kroger Co. of MI; Whether the ramp was unreasonably dangerous; "Open and obvious" danger; Novotney v. Burger King Corp. (On Remand); Properly preserving an issue; Hines v. Volkwagen of Am., Inc.

Court: Michigan Court of Appeals (Unpublished)

Case Name: Allen v. CDM Enter., Inc.

e-Journal Number: 53735

Judge(s): Per Curiam – Hoekstra, K.F. Kelly, and Beckering

 

The court held that the plaintiffs failed to present evidence raising a genuine issue of material fact as to the adequacy of defendant's inspection of the ramp and as to defendant's actual or constructive notice of the defect in the ramp. Further, the alleged design flaws in the ramp were open and obvious, and nothing in the record supported a finding that the condition was unreasonably dangerous or effectively unavoidable. Thus, the court affirmed the trial court's order granting defendant summary disposition. Plaintiffs were injured when they fell while exiting defendant's bar. They were walking one behind the other on a wooden ramp outside one of the exit doors when part of the ramp collapsed. The ramp did not have handrails. In plaintiffs' deposition testimony, they admitted that there were no visible signs of defects - the ramp "looked safe" and "perfect." They had also observed other patrons entering and exiting using the same doorway. Plaintiffs returned to the bar after their fall to take photos of the area in which they fell. They argued that the photos showed "weathered" wood and thus, defendant had constructive notice of a potential hazard. Defendant's owner testified that he regularly inspected the premises when looking for empty beer containers around the property. He testified that the only time there had ever been an issue with the ramp was in 2006 when it had to be repaired after a snowplow hit it. Plaintiffs argued that defendant's failure to adequately inspect the ramp was a breach of duty. However, the court concluded that there was "no evidence that defendant had actual or constructive knowledge of the 'defect' in the ramp." It was clear from the testimony of plaintiff-Allen, plaintiff-Cordts, and S, Allen's daughter, that the exit with the wooden ramp was being used by bar patrons on the night of the accident. Allen testified that the ramp "was perfect" as she stepped onto it. S testified that she had used the wooden ramp on occasions before the night of the accident and had never noticed damage to the ramp. The court held that the trial court "properly concluded that because (1) other patrons used the wooden ramp throughout the night, (2) there were no known complaints about the ramp's condition prior to the accident, and (3) Allen testified the ramp looked perfect before she walked on it, there was no evidence showing there was a defect in the ramp for a sufficient amount of time that the defendant had actual or constructive notice of the defect." The court also noted that the exit with the wooden ramp was not the main entrance/exit. Plaintiffs entered the bar via the main entrance that evening and thus, knew that the wooden ramp exit was not the only means of exiting the bar.

 


Qui Tam

 

This summary also appears under Litigation

 

Issues: Alleged violation of MCL 333.17755(2) (part of the Public Health Code (PHC) (MCL 333.17701 et seq.)); Docket No. 299997 - Whether plaintiff-Gurganus met the requirements of a proper qui tam relator under MCL 400.610a(13); MCL 400.610a(1); Statutory interpretation; Ward v. Michigan State Univ. (On Remand); "Alleging" and "transactions" defined; Whether there was a "public disclosure"; The Medicaid False Claim Act (MFCA)(MCL 400.601 et seq.); Whether the class action plaintiffs had a private cause of action pursuant to § 17755(2) or the Health Care False Claim Act (HCFCA) (MCL 752.1001 et seq.) (specifically MCL 752.1009); Chrisdiana v. Department of Cmty. Health; Brackett v. Focus Hope, Inc.; United States Fid. & Guar. Co. v. Michigan Catastrophic Claims Ass'n (On Rehearing); Robinson v. Lansing; Robinson v. Detroit; South Haven v. Van Buren Cnty. Bd. of Comm'rs; "Shall"; Isidore Steiner, DPM, PC v. Bonanni; Remedy; Pompey v. General Motors Corp.; Grand Traverse Cnty. v. Michigan; Purpose of the HCFCA; People v. Motor City Hosp. & Surgical Supply, Inc.; "Liable"; Bailey v. Oakwood Hosp. & Med Ctr.; Summary disposition under MCR 2.116(C)(8); Feyz v. Mercy Mem'l Hosp.; Dalley v. Dykema Gossett PLLC; Spelman v. Addison; Pleading fraud with particularity; Cooper v. Auto Club Ins. Ass'n; Kassab v. Michigan Basic Prop. Ins. Assoc.; Whether the heightened pleading standard in MCR 2.112(B)(1) applied; Zine v. Chrysler Corp.; Fed.R.Civ.P. 9(b); The Federal False Claims Act; Sanderson v. HCA-The Healthcare Co. (6th Cir.); United States ex rel Clausen v. Laboratory Corp. of Am., Inc. (11th Cir.); Whether the alleged violation of § 17755(2) is a "false claim" within the meaning of the HCFCA or the MFCA; Whether the complaints needed to plead facts demonstrating that a substitution transaction occurred; Securities Exchange Commission (SEC)

Court: Michigan Court of Appeals (Unpublished)

Case Name: State of Michigan ex rel Maricia Gurganus v. CVS Caremark Corp.

e-Journal Number: 53743

Judge(s): Per Curiam – M.J. Kelly, Hoekstra, and Stephens

 

Holding that the qui tam complaint was not based upon a public disclosure, the court reversed the trial court's conclusion in the qui tam action that plaintiff-Gurganus was not a proper relator. In the class action lawsuits, the court affirmed the trial court's conclusion that plaintiffs did not have a private cause of action pursuant to § 17755(2). However, because the court held MCL 752.1009 provides for a private cause of action, it reversed the trial court as to whether plaintiffs have a private cause of action pursuant to the HCFCA. Finally, because the court held that the qui tam complaint and both class action complaints satisfied the applicable pleading standards, it reversed the trial court's grant of summary disposition in favor of defendants in all three cases. The defendants in these consolidated cases operate pharmacies in Michigan. In each case, a qui tam action and two class action lawsuits, the defendants were alleged to have violated § 17755(2), which is part of the PHC and states, in pertinent part, that "[i]f a pharmacist dispenses a generically equivalent drug product, the pharmacist shall pass on the savings in cost to the purchaser or to the third party payment source if the prescription purchase is covered by a third party pay contract." Gurganus brought a qui tam action on behalf of the state alleging that defendants failed to comply with § 17755(2) when they submitted prescription drug claims for drugs dispensed to Medicaid beneficiaries to the state and failed to pass on the savings in cost obtained by the pharmacies in dispensing a generically equivalent drug. She claimed that, by doing so, defendants violated the MFCA, which specifically authorizes a qui tam action. On appeal, Gurganus argued that the trial court erred by granting summary disposition in favor of defendants on the basis that she was not a proper qui tam relator under the MFCA.The issue was whether Gurganus could meet the requirements of a proper qui tam relator under MCL 400.610a(13). She filed the qui tam complaint based upon the authorization set forth in the MFCA, which provides - "Any person may bring a civil action in the name of this state under this section to recover losses that this state suffers from a violation of [the MFCA]." However, the phrase "any person" is limited by MCL 400.610a(13). The parties' arguments revolved around whether, within the meaning of MCL 400.610a(13), a Wall Street Journal article, corporate annual reports from defendants-CVS Caremark Corporation and Walgreens, and SEC filings by defendant-Rite Aid constituted public disclosure of the allegations and transactions contained in the qui tam complaint. Thus, the court addressed whether there was a "public disclosure." The article merely discussed the fact that large corporations, such as defendants, find ways to maximize profits. It did "not even suggest that the larger profits that representatives of Walgreens and CVS claimed were made on generic drugs were realized as the result of unethical or unlawful conduct." The court held that the public disclosures upon which defendants relied did not rise to the level of disclosing any transaction on which the qui tam complaint was based.

 


Tax

 

Issues: The Single Business Tax (SBT) Act (SBTA)(MCL 208.1 et seq.) (repealed); Whether the plaintiff's "check-the-box" for "disagrees with determination" response to the defendant's preliminary audit determination provided adequate notice of a claim for refund; Michigan's Revenue Act (MCL 205.1 et seq.); MCL 205.30; MCL 205.3(b); MCL 205.21; "Petition . . . for refund"; "Claim for refund"; Statutory interpretation; Michigan Educ. Ass'n v. Secretary of State (On Rehearing); Niles Twp. v. Berrien Cnty. Bd. of Comm'rs; Marquis v. Hartford Accident & Indem.; Herald Co. v. Eastern MI Univ. Bd. of Regents; Whether the statutory terms were "ambiguous"; Lindsay Anderson Sagar Trust. v. Department of Treasury; When "adequate notice" of a claim for refund was given; The amount of deficiency interest due; MCL 205.23(2); "Deposits"; Abandoned issue; Woods v. SLB Prop. Mgmt., LLC; Award of attorney fees; Windemere Commons I Ass'n v. O'Brien; Contributions made to plaintiff's voluntary employee benefit association (VEBA) trust (29 USC § 501(c)(9))

Court: Michigan Court of Appeals (Unpublished)

Case Name: Ford Motor Co. v. Michigan Dep't of Treasury

e-Journal Number: 53652

Judge(s): Per Curiam – Whitbeck, Fitzgerald, and Beckering

 

The court held that overpayment interest began to accrue against the defendant 45 days after the date when the plaintiff filed its complaint, because that was "the first time that plaintiff truly provided defendant with adequate notice of a claim for refund." The court also held that the trial court correctly determined that "the date the funds were made available to defendant was the date on which the accrual of deficiency interest should cease, without regard to whether the funds were deposited with specific instructions regarding which particular tax liability to which the funds should be applied." The court vacated the trial court's award of attorney fees and remanded the case to the trial court for further consideration of this issue. The parties' initial dispute arose from defendant's audit of plaintiff to determine the SBT due for the years 1997-2001. Defendant sent plaintiff an audit determination letter on 8/3/05 stating that contributions plaintiff made to its VEBA trust were compensation taxable to employees under the SBTA. Plaintiff responded by checking the box on the letter marked "disagrees with this determination" and returning the letter to defendant the same day. Defendant assessed plaintiff a tax liability of approximately $20 million above the SBT already paid by plaintiff. Defendant also indicated that plaintiff owed approximately $2 million in tax deficiency interest resulting from the unpaid tax. Plaintiff paid the additional tax liability under protest and sued. The court previously held that the contributions plaintiff made to the VEBA trust in the tax years at issue did not constitute compensation under the SBTA and were not subject to the SBT. Plaintiff filed a motion in the trial court to enforce the court's judgment. While plaintiff argued on appeal that it provided defendant with adequate notice of a claim for refund when it checked the box marked "disagrees with this determination" on the audit determination letter and returned it to defendant, this contention did not comport with MCL 205.21(5), which provides the procedure for converting a "contest of the assessment" into a "claim for a refund." The court concluded that plaintiff's 8/3/05 response fit "more clearly within the plain meaning of the term 'contest of the assessment' than it does 'claim for a refund.'" The trial court clearly erred in concluding that overpayment interest began to accrue against defendant 45 days after plaintiff's "check-the-box" response to the 8/3/05 audit determination letter. Reversed in part, affirmed in part, vacated in part, and remanded.

 


Termination of Parental Rights

 

Issues: Whether the trial court properly terminated the respondent-father's parental rights to his minor daughter pursuant to §§ 19b(3)(c)(i), (g), and (j); In re Powers Minors; In re SD; In re Trejo Minors; In re Hudson; Best interests of the child; Whether the trial court considered the fact that the child was placed with a relative; In re Mason

Court: Michigan Court of Appeals (Unpublished)

Case Name: In re Terhaar

e-Journal Number: 53766

Judge(s): Per Curiam - Donofrio, Fort Hood, and Servitto

 

The court held that the trial court properly terminated the respondent-father's parental rights to his minor daughter where the statutory grounds were established by clear and convincing evidence and termination was in her best interests. The child was placed with her maternal grandmother, who was the primary caregiver for the child's 11 years of life. It was the child's desire to be adopted by the grandmother, it was in the child's best interests to be adopted by her relatives, and the trial court considered the placement with relatives in finding that terminating respondent's rights was in the child's best interests. Respondent's parental rights were previously terminated on 3/29/10, but the court granted his motion for peremptory reversal because he was denied the right to counsel and meaningful participation in the child protection proceedings. After remand, respondent was offered services, including therapy, combined with supervised visits. His parental rights were again terminated on 5/25/12. He argued that the trial court erred in terminating his parental rights under §§(3)(g) and (j), but did not challenge termination under § (c)(i). Only one statutory ground needs to be established to warrant termination. The court held that the trial court did not clearly err in finding that the statutory grounds for termination were established by clear and convincing evidence. Testimony established by that the child had been in the care of her maternal grandmother for most of her life. The child had never lived with respondent, although he had visitation when she was very young. Respondent went to prison in 2005 and prior to these proceedings, had not seen or communicated with child since she was 3 or 4 years old. In 5/11, respondent was released from prison and moved to a halfway house. He was released from there in 9/11, but returned to the halfway house because of a supervised release violation in 4/12. At the time the initial petition related to the child was filed, he was incarcerated. At the time of the termination hearing, the evidence established that his criminal behavior and incarceration or residency in a halfway house continued. Thus, the conditions at the time of termination and adjudication continued and there was no reasonable likelihood that they would be rectified within a reasonable time considering the child's age. Affirmed.