Request For Refund From CID

The Missouri Community Improvement District Act authorized the governing body of any municipality to establish community improvement districts (CID).  Under the Act a CID is authorized to levy a special assessment tax on real property within the district boundaries.  In 2011, the City of St. Louis, adopted Ordinance 68935 which created a CID District in downtown St. Louis.  In 2019, the plaintiffs, 1123 Washington (1123), filed a petition against the CID District, in downtown St. Louis, seeking to invalidate expenditures and enjoin the CID District from expending personnel and resources in connection with the challenged expenditures and argued the lawfulness and constitutionality of the special assessment.  The trial court found in favor of the City of St. Louis and the CID District because 1123 could not show the challenged expenditures were improper as a matter of law and that 1123 had failed to challenge the tax assessment within the time prescribed by state law in 67.1561 RSMo.  The trial court’s decision in the 2019 action was not appealed.  In 2021, while the trial court’s motion was pending in the 2019 lawsuit, 1123 commenced a new action with identical counts asserted in the 2019 case and also requested a refund of the special assessment.  After the 2019 judgment was entered the City of St. Louis and the Downtown CID moved for summary judgment in the 2021 case, arguing that the 2021 case was barred by res judicata and the request for a refund was barred by collateral estoppel.

The Eastern District found that 2021 lawsuit substantially raised the same claims raised in 2019 lawsuit which would be barred by res judicata and collateral estoppel.  The only difference was the relief sought and the assertion that the 2020 special assessment was paid under protest which 1123 claims permitted 1123 to seek relief under the Refund statute.  The Eastern District held that while the Refund statute in 139.031 RSMo. is the generally applicable statute the Missouri legislature provided under 67.1561 RSMo. a specific statute of limitations for challenging the validity of a CID tax and therefore 1123 is prohibited from bringing a claim under 139.031 RSMo.  Any claim to set aside the special assessment should have been brought within ninety days from the time the CID was approved.  1123 Washington Avenue Retail Condo vs. The Downtown St. Louis Community Improvement District, (ED112215, 7/16/24)

Court Cost Special Surcharges

The Missouri legislature has a long history of attaching by statute certain mandatory surcharges to court cost which when collected are then paid to various state funds.  The surcharges attached to court costs include a charge for DNA profiling analysis, brain injury, independent living, motorcycle safety, Missouri Office of Prosecution Services, the Spinal Cord Injury Fund.  The funds that are collected from the surcharges are managed by the Seven State Funds as directed by statute.

Ramirez had several criminal charges that were resolved in 2019 when he pled guilty.  As part of his plea agreement Ramirez was required to pay the court costs, which included the legislatively approved mandatory surcharges.  Ramirez filed a subsequent claim asserting that the surcharges constituted unjust enrichment and violated Article 1, Section 14 of the Missouri Constitution.  The state moved for summary judgment because the suit was barred by sovereign immunity and the statutes authorizing the surcharges do not violate Article I, Section 14 of the Missouri Constitution.  The trial court sustained the state’s motion concluding that the statutes do not violate the Missouri Constitution.

In this matter the defendant filed suit against the parties in their official capacity.  Sovereign immunity is a common law judicial doctrine baring suit against a government entity unless there exists an express statutory exception, common law exception, or it is waived.  The court found there did not exist in this matter a statutory exception, common law exception, and sovereign immunity was not waived therefore the suit is barred by sovereign immunity.  The court distinguished this matter from Fowler v. Missouri Sheriffs Retirement System because the issue of sovereign immunity was not raised in Fowler and a significant issue in Fowler was that court costs were being used to enhance the compensation paid to executive officials are not reasonably related to the expense of the administration of justice.  Ramirez v. Missouri Prosecuting Attorneys, (SC100376, 7/9/2024)

Retaliation For Making Reasonable Request For An Accommodation

Ms. Spagnolia started working for Charter Communications in 2016 as a Regional Operations Center Specialist in Denver, Colorado.  After giving birth to her second child Ms. Spagnolia used FMLA leave.  When she returned to working in the office, she had difficulty finding a location in the building suitable for pumping breast milk.  She was initially advised that she could use the Wellness Room to pump her breast milk.  However, due to construction the Wellness Room was not available, and Ms. Spagnolia had to pump in the bathroom.  Ms. Spagnolia objected and raised concerns about using the restroom for pumping.  She was then advised she could also use the women’s locker room, but she felt that was problematic because she would be accessing the room using her male supervisor’s key card. Ms. Spagnolia emailed another supervisor about the issue which included a link to state and federal laws that require employers to accommodate breast feeding mothers in the workplace.  The supervisor then provided Ms. Spagnolia with a vacant office but Ms. Spagnolia felt uncomfortable using that office because her silhouette was visible through the frosted glass. 

Two months after Ms. Spagnolia returned to work, Charter changed its pumping policy, and would no longer permit breaks used for pumping breast milk to be considered paid time.  Charter would require employees to clock out for these breaks.  This policy change would have a significant impact because Ms. Spagnolia pumping breaks during the day averaged 2-3 hours per day.

Ms. Spagnolia met with her supervisor to discuss the change in policy and she recorded the meeting without the supervisor’s knowledge or consent.  Charter learned that Ms. Spagnolia had recorded the meeting and subsequently fired Ms. Spagnolia.  Ms. Spagnolia sued alleging (1) pregnancy discrimination, (2) gender discrimination, (3) failure to accommodate, (4) retaliation, and (5) termination in violation of public policy.  The district court granted summary judgment on all five claims.

To establish a prima facie case of retaliation under that framework, Ms. Spagnolia must show (1) engagement in protected activity; (2) a “materially adverse” employment action; and (3) a causal connection between the protected activity and the adverse action.  If she establishes a prima facie case, the burden then shifts to Charter to produce a legitimate, non-discriminatory reason for the adverse employment action. If Charter does so, the burden shifts back to Ms. Spagnolia to establish that its proffered reason was pretextual.

The court of appeals affirmed the district court’s decision.  In this matter Charter was able to show that Ms. Spagnolia had previously been advised to not secretly record other employees, Charter was able to show that there did in fact exist a policy that prohibited employees from secretly recording other employees without consent, and other employees had been fired in the past for the same conduct.  Charter established there was a legitimate, non-discriminatory reason for firing Ms. Spagnolia and she could not show the adverse action was pretexual.  Spagnolia v. Charter Communications, (10^th Circuit 23-1190 D.C. No. 1:21-CV-01787-KLM, 7/2/24)

Prosecutorial Immunity

Carbajal and Leal (Appellants) were subpoenaed to testify in a state criminal trial.  Before the trial occurred, the state court vacated the scheduled trial date and would later reschedule the trial date.  Watada, who was a Deputy District Attorney for the Second Judicial District in Colorado, appeared before a different judge and allegedly testified ex-parte to the non-appearance of Carbajal and Leal, which resulted in the court issuing a warrant for the arrest of Carbajal and Leal for contempt of court.  Leal and Carbajal were arrested that same day and were released on bond.  A few weeks after the court issued the contempt charge and the arrest warrant the contempt charges were dismissed.

Appellants Leal and Carbajal filed a 1983 complaint against Watada alleging that their constitutional rights were violated.  The district court dismissed the Appellants claims.  On appeal, the 10^th Circuit affirmed the district court’s judgment on all counts except for the application of prosecutorial immunity to dismiss Appellants’ malicious prosecution claim against Watada.  Watada was not entitled to absolute immunity because prosecutors are not entitled to absolute immunity when they act as witnesses.  Appellants’ complaint had alleged that Watada provided false testimony to the state court.  The district court upon further hearings determined that Watada was not entitled to absolute immunity because she failed to present definitive evidence contradicting allegations that she did testify as a witness in the contempt hearing.  The court did find that Watada was entitled to qualified immunity because Appellants’ allegations did not support a claim for a constitutional violation.  Additionally, the Appellants failed to demonstrate that the prior proceedings terminated in their favor, explaining that the prosecution’s decision not to pursue contempt charges was insufficient to establish favorable termination. 

On appeal the 10^th Circuit reviewed whether Watada was entitled to qualified immunity in light of recent changes in the law.    To establish a 1983 malicious prosecution, claim the party must show that: “(1) the defendant caused the plaintiff’s continued confinement or prosecution; (2) the original action terminated in favor of the plaintiff; (3) there was no probable cause to support the original arrest, continued confinement, or prosecution; (4) the defendant acted with malice; and (5) the plaintiff sustained damages.”

The district court granted qualified immunity based on its finding that Appellants could not satisfy the favorable-termination element of their malicious prosecution claim.  The 10^th Circuit had previously held that it is “the plaintiff’s burden to show that the termination was favorable” and to be favorable “a plaintiff must allege facts which, if true, would allow a reasonable jury to find the proceedings terminated “for reasons indicative of innocence.  However, the United States Supreme Court in Thompson v. Clark, 596 U.S. 36 (2022) redefined this element and determined that “a plaintiff need only show that the criminal prosecution ended without a conviction” to satisfy the favorable-termination element.  The 10^th Circuit held that the decision of the prosecutor to not pursue charges constitutes a termination in the plaintiff’s favor.  The 10^th Circuit reversed the district court and remanded the case.  Carbajal v. Watada, (10^th Circuit 21-1370, 8/21/24)

Sexually Transmitted Disease Contracted In Automobile

Does this case raise an issue that you need to consider to prevent prolonged litigation?  Should your insurance policies expressly limit or prohibit any monetary recovery for a sexually transmitted disease contracted during consensual sex in the course of employment when that sexual activity took place on employer property or within an employer owned vehicle?  Obviously, there are numerous legal arguments that can be raised as a defense to that type of claim, and I would hope no one would need to worry about this issue after this case, but GEICO did not anticipate it would have to litigate this issue.  Perhaps you should consider additional language in anticipation of questionable claims being raised.

M.O. was in a sexual relationship with Martin Brauner.  M.O. alleged that she contracted HPV from Brauner when they had sex in his automobile.  M.O. threatened to sue Brauner and sent a demand letter to GEICO requesting payment of the $1,000,000 policy limit.  GEICO denied the demand and filed a declaratory judgment against Brauner and M.O. in federal district court in Kansas.  While the motion for declaratory judgment was pending, Bauner and M.O. reached a settlement through arbitration where M.O. may collect the settlement only against the insurer and the arbitrator awarded M.O. $5.2 million dollars under 537.065 RSMo.  M.O. then sought and obtained confirmation of the award in a Missouri state court.  GEICO appealed and the Missouri Supreme Court vacated the arbitration award and remanded to allow GEICO to intervene.  It was then determined that the federal district court in Kansas did not have jurisdiction and the case was transferred to a Missouri federal district court.  The district court found that the policy unambiguously required that “covered bodily injury” would need to arise out of the use of the automobile and that sexual activity in an automobile is not “using” an automobile under Kansas insurance law.      

In reviewing the insurance policy, the 8^th Circuit Court of Appeals found that the use was so remote from the negligent act that there was no causal relationship between the use of the car and the injuries sustained.  The negligent act in this matter was that Brauner failed to tell MO that he had HPV and he failed to take steps to prevent its transmission to M.O. and the injuries did not arise out of the use of Brauner’s automobile.  GEICO v. M.O., (8^th Circuit, 8/2/24)

First Amendment Violation Arising From Motor Vehicle Stop

Susselman was traveling down a roadway in Superior Township, Michigan, when he observed a Washtenaw Sheriff Patrol vehicle with flashing lights parked horizontally across one of the lanes in the roadway.  Susselman did not observe any barricades, traffic cones, or any officers directing traffic.  Susselman was not able to observe any activity further down the roadway from his location.  Susselman drove past the patrol vehicle.  After Susselman proceeded down the roadway Deputy King ran after Susselman’s vehicle and stopped Susselman for entering the scene of a fatal accident and he advised Sussleman he was going to issue a citation for the observed violation.  Susselman, in response proceeded to yell at the deputy after the deputy walked away from Susselman’s car and was as Deputy King wrote a citation for the violation.  After the ticket was issued to Susselman the charge for the violation was changed to a different charge, which Susselman discovered when he appeared before the court on the charge.  After Susselman appeared in court and learned of the change, Susselman contacted the prosecuting attorney and argued that he was being punished for arguing with the deputy.  The prosecutor dismissed the charge.  The prosecuting attorney then spoke to Deputy King about the case and the prosecutor filed or refiled the original charge, which was the same charge that had originally been issued on scene.  The subsequent charge was dismissed by the circuit court when the prosecuting attorney failed to respond to a motion to dismiss the charge.  Susselman then sued Washtenaw County Sheriff’s Office, Washtenaw County, Deputy King, and Superior Township under 42 USC 1983 and Michigan state law.  Susselman made numerous claims which included a claim of First Amendment retaliation and a violation of substantive due process rights.

The defendants moved to dismiss the claims and the district court granted their motions.  Susselman appealed the trial court’s decision.

Substantive Due Process Claim: Susselman failed to identify “a violation of an explicit constitutional guarantee or a behavior that shocks the conscience.  Susselman does not assert a violation of any constitutional guarantee so he must show that Deputy King’s conduct shocks the conscience which he has failed to show.  Susselman argued that issuing the second ticket was arbitrary and capricious.  The court stated that issuing a second citation when there does not exist probable cause does not shock the conscience. 

First Amendment Claim: A First Amendment claim must show that the party (1) “was engaged in protected conduct” (2) the defendant took adverse action against him that would deter a person of ordinary firmness from continuing to engage in that conduct, and (3) that the protected conduct caused the adverse action, at least in part.  Susselman failed to show a but for cause because the officer had already decided to issue a ticket at the time the alleged violation took place and prior to the conduct Susselman claims is protected by the First Amendment. Susselman can only offer speculation to support that the second ticket was issued in retaliation which is not sufficient to establish causation.   Susselman v Washtenaw, (6^th Circuit 23-1486, 7/29/2024)