VERDICT - OADC · Nicholas Baldwin-Sayre, Chair Cosgrave Vergeer Kester LLP 805 SW Broadway, #800 Portland, OR 97205 503/323-9000 503/323-9019 (fax) [email protected] Anne Cohen, Vice

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Portland, ORPermit No. 2175

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Trial Lawyers Defending You in the Courts of Oregon


Oregon Association of Defense Counsel Quarterly Magazine Winter 2011

Federal Rule Changes

• OADC 2011 Board of Directors

• Litigation Ethics North and South

of the Columbia

• Intentional Infliction of Emotional

Distress: Does Intentional Include

Reckless?

THE

VERDICT

2011 OADC Practice Group Leaders

TRANSPORTATION

Paul Conable, ChairTonkon Torp LLP888 SW 5th Ave., #1600Portland, OR 97204503/802-2188503/972-3888 (fax)[email protected]

Daniel Larsen, Vice ChairAter Wynne LLP1331 NW Lovejoy St., #900Portland, OR 97209503/226-1191503/226-0079 (fax)[email protected]

Heidee Stoller, PublicationsAter Wynne LLP1331 NW Lovejoy St., #900Portland, OR 97209503/226-8616503/226-0079 (fax)[email protected]

Heidi Mandt, Board LiaisonLaw Offices of Kenneth R. ScearceBuilding One4000 Kruse Way Pl., #135Lake Oswego, OR 97035503/534-4401503/534-4409 (fax)[email protected]

COVERAGE EMPLOYMENT NEW LAWYERS

PRODUCT LIABILITY PROFESSIONAL LIABILITY

Scott O’Donnell, ChairKeating Jones Hughes PC1 SW Columbia, #800Portland, OR 97258503/222-9955503/796-0699 (fax)[email protected]

Jonathan Bauer, Vice ChairParks Bauer570 Liberty St. SE #200Salem, OR 97301503/371-3502503/371-0429 (fax)[email protected]

Clark Horner, PublicationsHoffman Hart & Wagner1000 SW Broadway, 20th FloorPortland, OR 97205503/222-4499503/222-2301 (fax)[email protected]

Gordon L. Welborn, Board LiaisonHoffman Hart & Wagner439 SW Umatilla Ave.Redmond, OR 97756541/548-6044541/548-6034 (fax)[email protected]

TRIAL PRACTICE

CONSTRUCTION

Nicholas Baldwin-Sayre, ChairCosgrave Vergeer Kester LLP805 SW Broadway, #800Portland, OR 97205503/323-9000503/323-9019 (fax)[email protected]

Anne Cohen, Vice ChairSmith Freed & Eberhard PC111 SW 5th Ave., #4300Portland, OR 97204503/227-2424503/227-2535 (fax)[email protected]

Brian Church, PublicationsDavis Rothwell Earle & Xóchihua111 SW 5th Ave., #2700Portland, OR 97204503/222.4422503/222.4428 (fax)[email protected]

Dan Schanz, Board LiaisonSpooner & Much PC530 Center St., NE, #722Salem, OR 97301503/378-7777503/588-5899 (fax)[email protected]

COMMERCIAL

Wendy Paris, ChairLaw Offices of Kenneth R. ScearceBuilding One4000 Kruse Way Pl., #135Lake Oswego, OR 97035503/534-4401503/534-4409 (fax)[email protected]

Eric Meyer, Vice ChairZipse Elkins & Mitchell10200 SW Greenburg Rd., #700Portland, OR 97223503/245-3211503/245-3191 (fax)[email protected]

Matthew Ukishima, PublicationsSmith Freed & Eberhard PC111 SW 5th Ave., #4300Portland, OR 97204503/227-2424503/227-2535 (fax)[email protected]

David Auxier, Board LiaisonYturri Rose LLPPO Box SOntario, OR 97914541/889-5368541/889-2432 (fax)[email protected]

Robert Sabido, ChairCosgrave Vergeer Kester LLP805 SW Broadway, #800Portland, OR 97205503/323-9000503/323-9019 (fax)[email protected]

Lloyd Bernstein, Vice ChairGordon & Polscer9755 SW Barnes Rd., #650Portland, OR 97225503/802-9153503/242-1264 (fax)[email protected]

Elizabeth Knight, PublicationsDunn Carney851 SW 6th Ave., #1500Portland, OR 97204503/224-6440503/224-7324 (fax)[email protected]

Jay Beattie, Board LiaisonLindsay Hart1300 SW 5th Ave., #3400Portland, OR 97201503/226.7677503/226-7697 (fax)[email protected]

Amy Joseph Pedersen, ChairStoel Rives LLP900 SW 5th Ave., #2600Portland, OR 97204503/224.3380503/220.2480 (fax)[email protected]

Todd Hanchett, Vice ChairBarran Liebman LLP601 SW 2nd Ave, 23rd Fl.Portland, OR 97204503/228.0500503/274.1212 (fax)[email protected]

Allyson Krueger, PublicationsHitt Hiller Monfils Williams LLP411 SW 2nd Ave., #400Portland, OR 97204503/595.5382503/228.4250 (fax)[email protected]

Jeffrey Eberhard, Board LiaisonSmith Freed & Eberhard PC111 SW 5th Ave., #4300Portland, OR 97204503/227-2424503/227-2535 (fax)[email protected]

Vicki Smith, ChairBodyfelt Mount707 SW Washington St., #1100Portland, OR 97205503/243-1022503/243-2019 (fax)[email protected]

Ryan Boyle, Vice ChairBullivant Houser Bailey PC888 SW 5th Ave., #300Portland, OR 97204-2089503/228-6351503/295-0915 (fax)[email protected]

Jamie Valentine, PublicationsKeating Jones Hughes PC1 SW Columbia, Ste. 800Portland, OR 97258503/222-9955503/796-0699 (fax)[email protected]

David Campbell, Legislative RepWilliams Kastner & Gibbs PLLC888 SW 5th Ave., #600Portland, OR 97204503/228-7967503/222-7261 (fax)[email protected]

Molly Jo Mullen, Board LiaisonBodyfelt Mount707 SW Washington St., #1100Portland, OR 97205503/243-1022503/243-2019 (fax)[email protected]

Mary-Anne Rayburn, ChairMartin Bischoff LLP888 SW 5th Ave., #900Portland, OR 97204503/224-3113503/224-9471 (fax)[email protected]

Joshua DeCristo, Vice ChairSchwabe Williamson1211 SW 5th Ave., #1500-2000Portland, OR 97204503/796-2451503/796-2900 (fax)[email protected]

Jennifer Durham, PublicationsHiefield Foster & Glascock LLP6915 SW Macadam Ave., #300Portland, OR 97219503/501-5430503/501-5626 (fax)[email protected]

Michael “Sam” Sandmire, Board LiaisonAter Wynne LLP1331 NW Lovejoy St., #900Portland, OR 97209-3280503/226-1191503/226-0079 (fax)[email protected]

Jon Stride, ChairTonkon Torp LLP888 SW 5th Ave., #1600Portland, OR 97204503/802-2034503/972-3734 (fax)[email protected]

Eric DeFreest, Vice ChairLuvass Cobb777 High St.Eugene, OR 97401541/484-9292541/343-1206 (fax)[email protected]

Kelly Giampa, PublicationsHoffman Hart & Wagner1000 SW Broadway, 20th FloorPortland, OR 97205503/222-4499503/222-2301 (fax)[email protected]

Michael Lehner, Board LiaisonLehner & Rodriques, PC1500 SW 1st Ave., #1150Portland, OR 97201503/226-2225503/226-2418 (fax)[email protected]

OADC NewsletterEditors 2011

EDITOR IN CHIEFJeanne Loftis Bullivant Houser Bailey PC888 SW 5th Ave., #300 Portland, OR 97204 503/499-4601 [email protected]

ASSOCIATE EDITOR Stephen DeatherageBullivant Houser Bailey PC888 SW 5th Ave., #300Portland, OR 97204503/[email protected]

FEATURE ARTICLES EDITORBruce HamlinMartin Bischoff888 SW 5th Ave., #900Portland, OR 97204503/[email protected]

CASE NOTES EDITORDan LindahlLindahl Law Firm PC 121 SW Morrison St., #1100 Portland, OR 97204 503/241-4099 [email protected]

PRACTICE TIPS EDITOR Eric Meyer Zipse Elkins & Mitchell10200 SW Greenburg Rd.,#700 Portland, OR 97223503/[email protected]

EDITORIAL ASSISTANT Stephanie WilkenBullivant Houser Bailey PC 888 SW 5th Ave., #300 Portland, OR 97204503/499-4490 [email protected]

The Oregon Association of Defense Counsel State Political Action Committee (PAC)The Voice of the Civil Defense LawyerThe Oregon Association of Defense Counsel works to protect the interests of its members before the Oregon legislature, with a focus on:

• Changes in civil practice and the court system

• The judiciary and trial court funding

• Tort reform

• Access to justice

The Oregon Association of Defense Counsel has a compre hensive government affairs pro gram, which includes providing effective legislative advocacy in Salem.

We need your help and support to continue this important work. All donations to the OADC State PAC go to directly support our efforts to protect the inter ests of the Civil Defense Lawyer.

Your contribution to the Oregon Association of Defense Counsel State PAC will support OADC’s efforts in legislative activities and government affairs.

To make a contribution please contact the OADC office to receive a donation form at 503.253.0527 or

800.461.6687 or [email protected]

OADC BOARD OF DIRECTORS

OFFICERS

JEANNE LOFTISPresidentBullivant Houser Bailey PC888 SW 5th Ave., #300 Portland, OR 97204503.499.4601 • 503.295.0915 (fax)[email protected]

GREG LUSBYPresident ElectArnold GallagherPO Box 1758 Eugene, OR 97440541.484.0188 • 541.484.0536 (fax)

MICHAEL (SAM) SANDMIRESecretary/TreasurerAter Wynne LLP1331 NW Lovejoy St., #900Portland, OR 97209503.226.1191 • 503.226.0079 (fax)[email protected]

DIRECTORS

DAVID AUXIERYturri Rose LLPPO Box “S”Ontario, OR 97914541.889.5368 • 541.889.2432 (fax)[email protected]

JAY BEATTIELindsay Hart1300 SW 5th Ave., #3400Portland, OR 97201503.226.7677 • 503.226.7697 (fax)[email protected]

JEFFREY EBERHARDSmith Freed & Eberhard PC111 SW 5th Avenue, #4300Portland, OR 97204503.227.2424 • 503.227.2535 (fax)[email protected]

MICHAEL LEHNERLehner & Rodrigues PC1500 SW 1st Ave., #1150Portland, OR 97201503.226.2225 • 503.226.2418 (fax)[email protected]

HEIDI MANDTLaw Offices of Kenneth R. Scearce4000 Kruse Way PlaceBldg 1, Ste. 135Lake Oswego, OR 97035503.534.4401 • 503.534.4409 (fax)[email protected]

MOLLY JO MULLENBodyfelt Mount707 SW Washington St., #1100Portland, OR 97205503.243.1022 • 503.243.2019 (fax)[email protected]

DAN SCHANZSpooner & Much PC530 Center St., NE, #722Salem, OR 97301503.378.7777 • 503.588.5899 (fax)[email protected]

GORDON WELBORNHoffman Hart & Wagner LLP439 SW Umatilla Ave. Redmond, OR 97756541.548.6044 • 541.548.6034 (fax)[email protected]

ADMINISTRATIVE OFFICE

SANDRA FISHER, CAE147 SE 102nd

Portland, OR 97216503.253.0527 • 503.253.9172 (fax)[email protected]

D E P A R T M E N T S

ASSOCIATION NEWS 14

PENDING PETITIONS FOR REVIEW 20

RECENT CASE NOTES 15

FROM THE PRESIDENT 2

The VerdictA quarterly publication of OADC

PRACTICE TIPS 26✔✔

F E A T U R E S

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8

12

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LEGISLATIVE UPDATE 28

FEDERAL RULE CHANGES MAy STREAMLINE ExPERT DISCLOSURE AND SUMMARy JUDGMENT PRACTICEKari Furnanz

LITIGATION ETHICS NORTH AND SOUTH OF THE COLUMbIAMark J. Fucile

INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS: DOES INTENTIONAL INCLUDE RECkLESS?John Bauer & Michael Walker

APPLyING bELL TO CONSTRUCTION DEFECT CASESRobert E. Sinnott

LITIGATING THE “FAIR VALUE” OF A bUSINESS ORGANIzATIONC. Robert Steringer

OADC 2011 Board of Directors (Proceeding from lower left up: Heidi Mandt, Jeff Eberhard, Sam Sandmire, Jay Beattie; Proceeding from lower right: Jeanne Loftis, Michael Lehner, David Auxier, Greg Lusby, Gordon Welborn)

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The VerdicT ■ WinTer 20112

hen opportunity knocks, there are sometimes sound reasons to ignore the call for action. There are many solid excuses: the undertaking may cost too much, or we

do not have enough time, or it might involve too much risk. This is not to

mention the concern associated with wheth-er the investment of time and money will “pay off.” As we con-tinue to tighten our firm’s purse strings to brace for what is sure to be another couple of years of challenging

economic times, and as we continue to do more with less both at home and at work, we should consider the opportunities available to us. What opportunities do we have right now at home and at work that may provide us the platform to soar in 2011? Over the past three years we have watched the unraveling of the plastic economy and witnessed many around us fall victim to it. If you are like me, you are fed up with worrying and are ready to just buckle down and work hard. We can take comfort in the fact that there is a certain amount of certainty in a situa-tion that has remained this uncertain for so long. As such, there is no better time to challenge ourselves and make 2011 a year of doing rather than watching, a year of leading rather than following,

and a year of creating rather than copy-ing. 2011 is a year to wholeheartedly say “YES” with respect to the opportunities that life, work, and family offer to us.

It was just about seven years ago now that a friend and I were watching our kids play a basketball game for the YMCA when she casually mentioned that she thought it would be a good

idea if Blair and I had another child. At the time, we were already outnumbered with two boys ages 5 and 8 and a little girl age 3. The boys were busy with school, scouts, music, and sports and our little girl, having found her voice, was quickly becoming the leader of the pack with her directives and demands. My husband and I were climbing the

p r e s i d e n t ’ s m e s s a g e

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Jeanne Loftis

b y j e a n n e l o f t i s

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Just Say “Yes”

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The VerdicT ■ WinTer 2011 3

PRESIDENT’S MESSAGEcontinued from page 2

upward slope towards the peak of our careers. The thought of adding to this controlled chaos seemed to border on the ridiculous.

Nevertheless, during this particu-larly peaceful and harmonious period in the Loftis family, we decided to take a leap forward and to add to our fam-ily. Then, early in my pregnancy, we received the news that our baby had down syndrome. As we processed this news and how it might impact our fam-ily, we held our family and friends close and braced ourselves for the unknown. We knew very little about down syn-drome, and most of what we knew was outdated and incorrect. Joey Loftis has presented us with an entrée into a world we previously didn’t know existed and a perspective we are only beginning to understand. I hope to achieve the love, faith, and zeal for life with which he approaches each day. We are fortunate to have acted on the suggestion of our friend and just said “yes” to expanding our family.

So, what opportunities do you have for growth in your life, family, or work? Is it possible that more of your cases will go to trial if you seize the op-portunity that trials afford for you and your clients? Trial lawyers are in the best position to encourage their clients to seize the opportunity offered by taking a case to verdict. There are few things less satisfying in our profession than settling on the courthouse steps, especially if the settlement is connected in any way to last-minute changes in the assessment of risk — either due to unanticipated developments or oppos-ing counsel who is overly anxious about the stress of trial. My good friend and trusted mentor Ron Bailey cautioned strongly against “eve of trial” changes in evaluations of cases. With his good

advice in mind, I believe I have gained the trust and respect of my clients by rarely changing my evaluation of the risks involved in a case in those final days leading up to trial. Ask yourself whether you are seizing the opportunities trial affords you and your clients.

Twenty-five years ago, I was an un-dergraduate struggling to keep up with the engineering and science students at UC Davis. My major was physiology and included many science courses, such as organic and inorganic chemistry. I was not particularly gifted in the fine art of memorization and, as such, had a fair amount of difficulty in courses such as zoology. Nevertheless, I seized on the ancillary opportunities a university system has to offer its students, such as the opportunities to listen to visiting lecturers like Stephen Hawking, Galen Rowell, Henry Kissinger, and Jody Pow-ell. While I have no particular recall of the names of the various parts of an American Shrew Mole, I do recall the stories and anecdotes shared by these interesting lecturers. Saying “yes” to the extracurricular activities at college holds many of my finest memories, and what I gained through these activities is tangible 25 years later.

What are you doing today that you will recall in 25 years? I’m fairly certain I will recall my dinner at Maro’s Shrimp House in Cabo San Lucas with my hus-band Blair and OADC President-Elect Greg Lusby and his wife Kelliss during the state leader regional meeting in January. The evening included an en-tire restaurant of diners spontaneously swaying their arms in the air and sing-ing along with a guitarist as he played a soulful “Sweet Caroline” followed by a spirited “La Bamba.” The friend-ships I have developed through my involvement in OADC already comprise

many of my most cherished profes-sional moments. Aside from family and work, consider whether there are opportunities available for you to get involved with meaningful professional associations, like OADC. I’m certain that your involvement in associations such as these will help you create fond and lasting memories with your defense comrades.

So, as we embark on 2011, I encour-age you to consider what opportunities you might be passing by in terms of your family life, your approach to trial, and your approach to extracurricular activities. By way of professional extra-curricular activities, consider including in your new year’s resolutions active involvement in those professional as-sociations you find meaningful. I trust you will find that saying “yes” to these opportunities may provide an additional source of depth and enjoyment to your professional life. Seizing opportunities creates opportunities, and in times like these every opportunity counts. J

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oth the Federal Rules of Civil Procedure and the District of Oregon Local Rules were amended in recent months. Changes to the federal rules took effect on December 1,

2010; amendments to the local rules took effect on January 1, 2011. Although several rules were revised, the two with the most significant impact on civil defense practice are likely to be changes to the expert witness disclosure re-quirements and to sum-mary judgment practice.

Following is a summary of the amendments that apply to these two procedures in fed-eral court, and a brief analysis of how the changes may impact civil defense practice.Expert Witness Disclosures

The recent changes in the Federal Rules of Procedure include amendments to FRCP 26 simplifying the expert disclosure process, reducing the amount of information to be included in reports, and clarifying and extending the work product doctrine.

Full Disclosure Not Necessary for Some Witnesses. First, the rule contains a new section 26(a)(2)(C) titled “Witnesses Who Do Not Provide a Written Report.” Previously, the assumption was that any witness called to testify and render an ex-pert opinion was required to prepare a re-port. The amended rule, however, specifies that reports authored by experts are only necessary “if the witness is one retained or specially employed to provide expert

testimony in the case or one whose duties as the party’s employee regularly involve giving expert testimony.” FRCP 26(a)(2)(B). The rule goes on to say that witnesses who do not meet this standard may instead be required to prepare a more condensed disclosure statement (described below).

This change may primarily impact treating physicians; in other words, plain-tiff’s counsel would no longer need to have the treating physician prepare the complete expert disclosure. However, it is important to note that the revision can also apply to potential defense experts. For example, an engineer employed by the defendant would not be required to submit the full disclosure report prior to providing expert testimony.

Importantly, even though such wit-nesses need not prepare a complete FRCP 26 report, a disclosure is still required, albeit in a more concise format, which includes the following information:

(i) the subject matter on which the witness is expected to present evidence under Fed-eral Rule of Evidence 702, 703, or 705; and

(ii) a summary of the facts and opinions to which the witness is expected to testify.

FRCP 26 (a)(2)(C). Accordingly, in the early stages of a case, it will be important to identify the type of person who may be providing expert opinion at trial to ensure that the appropriate report or disclosure is prepared.

Drafts Are Considered “Work Prod-uct.” Second, drafts of expert reports are no longer subject to review by opposing

counsel. Previously, when an expert was disclosed, counsel was permitted to review the expert’s file, which included his or her draft report disclosure statements. Such drafts are now explicitly protected from disclosure under the work product doctrine: “Rules 26(b)(3)(A) and (B) protect drafts of any report or disclosure required under Rule 26(a)(2), regardless of the form in which the draft is recorded.” FRCP 26(b)(4)(B).

Work Product Protection Applies to Most Expert Communications with Counsel. Third, the amended rule clari-fies that work product protection extends to communications between counsel and their experts. Such communications are protected from disclosure unless they:

(i) relate to compensation for the expert’s study or testi-mony;

(ii) identify facts or data that the party’s attorney provided and that the expert considered in forming the opinions to be expressed; or

(iii) identify assumptions that the party’s attorney provided and that the expert relied on in forming the opinions to be expressed.

FRCP 26(b)(4)(C). Notably, this work prod-uct protection applies only to experts who prepare the “full” report as outlined in FRCP 26(a)(2)(B), as opposed to the ab-breviated disclosures prepared pursuant to (a)(2)(C). Thus, a plaintiff attorney’s communications with treating physicians are not protected. As well, there is the potential that a plaintiff’s attorney could

Federal Rule Changes May Streamline Expert Disclosure and Summary Judgment PracticeKari FurnanzHoffman, Hart & Wagner, LLP

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argue that some communications with defense counsel’s employee “experts” are not protected. However, one could argue that this rule was intended to extend work product protection, not to eliminate pro-tection that previously existed.

Finally, the rule has been changed to state that an expert must provide only the “facts or data considered.” FRCP 26(a)(2)(B)(ii). The previous version of the rule also required the disclosure of “other informa-tion,” which was often broadly interpreted to also include information not actually pertinent to the expert’s conclusions. The revision was meant to clarify the type of information to be disclosed.Summary Judgment Motions

The summary judgment rules at both the federal and local level were also amended.

Elimination of the Concise State-ment of Facts. First, the most welcome change will likely be the elimination of the Concise Statement of Material Facts. As of January 1, 2011, Local Rule 56 for the U.S. District of Court for the District of Oregon no longer requires that a concise state-ment be filed concurrently with a motion for summary judgment, stating instead: “A party’s factual positions must be supported by citations, by page and line as appropri-ate, to the particular parts of materials in the record. Unless otherwise ordered by the court, a party is not required to file a separate Concise Statement of Material Facts.” Local Rule 56-1(a).

The preparation of the concise state-ment was often viewed as an overly time-consuming and exacting process. Thus, the hope is that this change may reduce the time and expense involved in preparing motions for summary judgment in federal court. Indeed, the commentary to the rule indicates that the goal of the change is to attempt to ascertain the undisputed facts “as efficiently and economically as possible.” Commentary 1 to Local Rule 56-1. The commentary states also that this change is not necessarily permanent and, instead, “is subject to a period of study and evaluation.” Id.

Bearing in mind the goals stated in the commentary to Local Rule 56-1, it is important to note that even if the concise statement need not be submitted, one should not abandon the more helpful aspects of this procedure. For example, when prepared well, the statement could serve as a useful tool for illustrating the issues that are not in dispute. Even if a statement of facts is contained in the legal memorandum, counsel should consider how to present facts in a similarly organized and efficient way.

Moreover, the concise statement also provided a clear way to review the facts submitted by the opposing side and, if nec-essary, raise objections. Under the former version of Local Rule 56-1(g), a party could easily identify in its reply memorandum which of the opposing party’s statements, if any, contained inadmissible evidence by reference to the paragraph numbers in the opposing party’s statement. Without the numbering of the opposing party’s factual statements, identifying the inadmissible evidence for the court may be more chal-lenging. Therefore, each exhibit, deposi-tion reference, or declaration statement should be specifically identified.

Evidentiary Objections. The refer-ence to evidentiary objections is now found in Local Rule 56-1(b). The rule continues to encourage parties to raise such objections in the response or reply briefing, rather than by filing motions to strike. When raising objections, counsel should be mind-ful of the Ninth Circuit Court of Appeals decisions that require that such evidentiary objections be sufficiently obvious and clear to allow the court to issue a ruling on the matter. See, e.g., Pfingston v. Ronan En-gineering Co., 284 F3d 999, 1003 (9th Cir 2002)(“In order to preserve a hearsay objec-tion, a party must either move to strike the affidavit or otherwise lodge an objection with the district court”).

FRCP 56. Several changes were also made to the federal rule governing sum-mary judgment motions. Many of these changes do not necessarily impact practice in the District of Oregon because they re-

flect practice that was already occurring in this district. However, the recent amend-ments to the rule contain two components that may be useful when filing summary judgment motions.

First, the rules now state that a party moving for summary judgment must cite “to particular parts of materials in the re-cord” to demonstrate that a fact is not dis-puted. FRCP 56(c)(1)(A) (emphasis added). In Oregon, this practice was essentially already in place due to the requirement to cite to the page and line numbers of depositions. However, it is important to review motions carefully when citing to other types of exhibits to make sure that it will be very clear to the court where the fact is contained in the record. For example, when citing to an affidavit or declaration, the paragraph number should be included. Without doing so, there is the potential that the court may not consider the fact “undisputed.” A party opposing summary judgment is also subject to this standard.

Second, the rule now clarifies that the court may make other rulings short of granting summary judgment. Many of these options were previously implied but are now explicitly codified in the rule. For example, the court may grant partial summary judgment or provide a nonmov-ing party with additional time to respond. Significantly, if the court does not grant summary judgment, the rule states that a judge “may enter an order stating any ma-terial fact — including an item of damages or other relief — that is not genuinely in dispute and treating the fact as established in the case.” FRCP 56(g). This option can be helpful in a subsequent trial and may also be useful in settlement negotiations.Other Amendments

Summaries of additional amend-ments to the rules can be found at the following links: http://www.uscourts.gov/RulesAndPolicies/FederalRulemaking/CompletedRules/Aug08Dec10Complete-dAmendments.aspx and http://www.ord.uscourts.gov/announcements/changes-to-local-rules-effective-january-1-2011. J

FEDERAL RULE CHANGEScontinued from page 4

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ince Oregon and Washington adopted reciprocal admission in 2002, defense lawyers increasingly practice in both states. Defense counsel handling cases on both sides

of the Columbia know that Oregon and Washington each use variants of civil rules based on the Federal Rules of Civil Procedure. They are also acutely aware, however, that significant differences

remain, ranging from the absence of expert discovery in Oregon t o E R 9 0 4 n o t i c e s in Washington. So, too, with l it igation ethics. Although the professional rules in Oregon and Washington

each use versions of the ABA Model Rules of Professional Conduct, important differences remain north and south of the Columbia.

In this article, we’ll begin with a note on choice of law in cross-border practice and then examine three key areas of litigation ethics where important distinctions remain: (1) applying the “no contact” rule in the corporate setting; (2) handling inadvertent production; and (3) determining whether insurance defense counsel have one client or two. With each, we’ll focus on state court practice. It is important to remember, however, that local rules in our Northwest federal courts adopt, respectively, the Oregon (Oregon District LR 83-7(a)) and Washington (Western District GR 2(e)(2) and Eastern District LR 83.3(a)) Rules of Professional Conduct.

Choice of LawLitigators seldom need to look beyond

the courthouse to determine which state’s professional rules apply. Oregon and Washington have both adopted choice of law rules patterned on ABA Model Rule 8.5(b). Their respective versions of RPCs 8.5(b) are identical and provide that the professional rules of the forum state apply in litigation matters. There are, however, subtle differences in two important respects.

First, the methods of enforcing the professional rules differ on a practical level. The ABA’s annual Survey on Lawyer Discipline Systems (available at www.abanet.org/cpr/discipline/sold/home.html) suggests that on a per capita basis, Oregon-based lawyers are much more likely to have a bar complaint filed against them and to be formally prosecuted by their state bar than their counterparts in Washington. In fact, for 2009 (the last year for which the ABA comparative statistics are available), an Oregon lawyer was roughly four times as likely to be the target of a formal disciplinary prosecution as a Washington lawyer. By contrast, reported decisional law suggests that Washington’s courts often play a more direct role in supervising the professional conduct of lawyers appearing before them than their Oregon counterparts. In Magaña v. Hyundai Motor America, 167 Wn2d 570, 220 P3d 191 (2009), for example, the Washington Supreme Court affirmed an $8 million default judgment entered as a discovery sanction for withholding material documents in a product liability case, chastising both the defendant automaker’s legal department

and its outside national counsel in the process. By contrast, a few months before Magaña, the Oregon Court of Appeals in G.B. v. Morey, 229 Or App 605, 215 P3d 879 (2009), observed that asserted attorney ethics violations are the province of the disciplinary system rather than the trial courts.

Second, Oregon’s professional rules contain more unlabelled “traps” than the Washington rules. When Oregon last comprehensively updated its professional rules, in 2005, it retained some of the verbiage of its former Disciplinary Rules without calling out those distinctions from ABA Model Rule terminology in accompanying comments (and, indeed, Oregon, unlike most jurisdictions, has not adopted any comments at all). By contrast, when Washington last systematically amended its professional rules in 2006, it plainly labeled key distinctions from the ABA Model Rules with “Washington comments” that explain the differences and are largely rooted in longstanding Washington case law. As a result, even a well-intentioned lawyer is at greater risk of running afoul of unsuspecting traps in the Oregon rules than in the Washington RPCs.The “No Contact” Rule in the Corporate Context

Oregon and Washington have both adopted variants of the “no contact” rule (RPC 4.2 in each) that are comparatively similar in overall concept. But they differ in a key respect when applied in the corporate (or other entity) context. Both protect corporate officers and senior managers from direct contact by opposing counsel by including them within the scope of corporate counsel’s

Litigation Ethics North and South of the ColumbiaMark J. FucileFucile & Reising LLP

Mark J. Fucile

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representation. Oregon and Washington take differing approaches, however, to line-level corporate employees whose conduct is at issue.

In Oregon, a line-level corporate employee whose conduct is at issue is considered within corporate counsel’s representation and, therefore, is “off limits” from direct contact by opposing counsel. Oregon State Bar Formal Ethics Opinion 2005-80 (2005) notes that this approach is based on the fact that the opposing party is attempting to hold the corporation vicariously liable for the acts of its employee.

In Washington, by contrast, a line- level corporate employee is construed to fall within corporate counsel’s representation only if the employee is a “speaking agent” under Washington Evidence Rule 801(d)(2)(iv). Comment 10 to Washington RPC 4.2 notes that this approach is based on the Washington Supreme Court’s decision in Wright v. Group Health Hospital, 103 Wn2d 192, 691 P2d 564 (1984). Professor Robert Aronson of the University of Washington School of Law in his Law of Evidence in Washington (at § 801.04[3][b][v] (2007 rev ed)) observes that this standard potentially draws a much smaller circle of employees within corporate counsel’s representation for purposes of the rule than most other states (or the federal rules). In Wright, for example, the Washington Supreme Court found that corporate defense counsel’s representation did not automatically extend to nurses who were involved in the care of the claimant in a medical malpractice case.Inadvertent Production

Oregon and Washington generally reach the same result in handling i n a d v e r t e n t p r o d u c t i o n i s s u e s . Washington, however, has moved to a rule-based system that makes the analysis much more straightforward than in Oregon at a time when electronically stored information plays an increasingly prominent role in both discovery generally and inadvertent production in particular.

In Oregon, the duty to notify opposing counsel of the receipt of what appears to be inadvertently produced privileged information is found in RPC 4.4(b). Oregon State Bar Formal Ethics Opinion 2005-150 (2005) notes that the associated questions of how to litigate potential privilege waiver and the criteria for determining whether privilege has been waived are governed by, respectively, procedural and evidence law. Although Oregon’s Council on Court Procedures (see http://legacy.lclark.edu/~ccp/index.htm) has proposed amendments that address some electronic discovery issues, Oregon’s procedural rules have not (at least yet) been amended to parallel Federal Rule of Civil Procedure 26 in this regard. In short, the specific method—and accompanying interim duties—for litigating waiver through inadvertent production in Oregon state court are presently open questions. As for waiver itself, although Oregon case law (see, e.g., Goldsborough v. Eagle Crest Partners, Ltd., 314 Or 336, 838 P2d 1069 (1992)) uses a set of criteria that is functionally similar to new Federal Rule of Evidence 502, Oregon does not have a black-letter rule on this point either.

In Washington, by contrast, guidance is both clearer and rule-based. Washington RPC 4.4(b), like its Oregon counterpart, requires lawyers receiving what appears to be an opponent’s inadvertently produced privileged material to notify opposing counsel. In 2010, Washington approved amendments to, respectively, its Civil and Evidence Rules that mirror the corresponding federal rules in this area. Under CR 26(b)(6), a party receiving inadvertently produced material must now return or destroy the material or sequester it pending resolution by the court of whether privilege has been waived (and, in doing so, generally reflects the precepts articulated in existing Washington case law under In re Firestorm 1991, 129 Wn2d 130, 916 P2d 411 (1996), and Richards v. Jain, 168 F Supp2d 1195 (WD Wash 2001)). New Washington ER 502, in turn,

focuses the question of privilege waiver

on the reasonable steps the holder took

to prevent disclosure, and in doing so,

generally reflects existing Washington case

law under Sitterson v. Evergreen School

Dist. No. 114, 147 Wn App 576, 196 P3d

735 (2008).

The Client in Insurance Defense

Oregon and Washington take

opposite positions on whether insurance

defense counsel have one client or two.

Under a series of ethics opinions (OSB

Formal Ethics Ops 2005-30 (2005), 2005-77

(2005), 2005-121 (2005)), Oregon views

insurance defense counsel (absent specific

agreement to the contrary) as having

two clients: the insured and the insurer.

Washington, in turn, under both case law

(Tank v. State Farm Fire & Cas. Co., 105

Wn2d 381, 715 P2d 1133 (1986)) and a state

bar ethics opinion (WSBA Formal Ethics

Op 195 (1999; amended 2009)), finds that

insurance defense counsel represent only

the insured, with the carrier considered a

third party payor—albeit one generally

covered by a “common interest” privilege.

The distinction is not merely academic, as

Oregon’s “two-client” approach has on

occasion been the basis for carriers to seek

disqualification of counsel. In Sabrix, Inc.

v. Carolina Cas. Ins. Co., No. CV-02-1470-

HU, 2003 WL 23538035 (D Or July 23,

2003) (unpublished), for example, a carrier

sought disqualification of a firm handling

a coverage matter against it that was also

defending one of its insureds in unrelated

litigation in another state. Although the

court denied the motion, it underscores

the need to carefully assess and address

the conflict implications of Oregon’s “two-

client” model.

Summing Up

Since civil practice and litigation ethics

in Oregon and Washington differ, defense

counsel practicing on both sides of the

Columbia need to be vigilant in keeping

these distinctions in mind. J

LITIGATION ETHICScontinued from page 6

8

FEATURES


he tort of intentional inflic-tion of emotional distress (IIED) has been recognized in Oregon courts in one form or another since 1969. As we all know, plaintiffs’ law-

yers have made it a habit in many civil cases to throw in a claim for intentional

infliction of emotional distress. But to state a claim for IIED, the plaintiff must plead and prove that the de-fendant intended to inflict severe emotional distress on the plain-tiff, the defendant’s acts were the cause of plaintiff’s severe emo-tional distress, and the defendant’s acts consti-tuted “an extraordinary transgression of the bounds of socially toler-able conduct.” McGanty

v. Staudenraus, 321 Or 532, 544 (1995). Many times we, as defense

lawyers, are able to dismiss IIED claims based on the argument that the conduct alleged does not meet the high threshold set by the “extraordinary transgression” standard. This article will discuss another

arrow for your quiver when moving to

dismiss a claim for IIED.

Oregon courts have recognized the

tort of “outrageous conduct” since the

case of Pakos v. Clark in 1969. 253 Or

113 (1969). The Oregon Supreme Court,

in Pakos, acknowledged the elements

of IIED as outlined in Section 46 of the

Restatement of Torts without expressly

adopting those elements. In subsequent

cases, the Oregon Supreme Court then

suggested and adopted the basic ele-

ments of the tort as outlined in Section

46, but did not adopt Section 46 in toto

as Oregon law. Since Pakos, Oregon

courts have also begun to lessen the req-

uisite level of intent based on the nature

of the relationship between the parties.

In McGanty, the court set out to

correct a series of cases that improperly

looked to the relationship between the

parties to determine the level of intent

required to impose liability. McGanty

reconsidered and clarified the common

law rule regarding the level of intent

required to establish IIED by specifically

adopting language from the Restate-

ment Second of Torts, Section 46 stating:

“The rule stated in this section applies

where the actor desires to inflict severe

emotional distress, and also where he

knows that such distress is certain, or

substantially certain to result from his

conduct.” McGanty, 321 Or at 550 (1995)

(emphasis in original). The subsequent

sentence in the Restatement, which the

court did not adopt, states: “It applies

also where he acts recklessly, as that term

is defined in Section 500, in deliberate

disregard of a high degree of probability

that the emotional distress will follow.”

Restatement Second of Torts, Section

46(i) (1946). Thus, McGanty makes it

clear that allegations of intentional con-

duct are necessary to plead a claim for

IIED, but that recklessness, on the other

hand, does not establish such a claim.

One must always be cognizant,

when moving against a claim that at-

tempts to allege reckless infliction of

emotional distress, that in certain circum-

stances such a claim may exist outside the

confines of the tort of IIED. For example,

Oregon law allows recovery for negligent

infliction of emotional distress where

there is an infringement on a legally

protected interest, physical impact or,

in certain limited circumstances, a claim

for malpractice when a specific duty to

avoid psychological harm is breached.

But be careful – do not win the day on

dismissing a claim for IIED if the conduct

alleged does not meet the required level

of intent and lose the war by educating

the plaintiff about negligent infliction

of emotional distress.

Intentional Infliction of Emotional Distress:Does Intentional Include Reckless?

John Bauer & Michael WalkerParks Bauer Sime Winkler & Fernety LLP

John Bauer

T

Michael Walker


9

FEATURES


Since McGanty there has been no Oregon decision specifically stating that the element of intent in IIED does not include reckless conduct. However, per-suasive federal court decisions have di-rectly addressed this question, including a decision by Judge Frye in Snead v. Met-

ropolitan Prop. Ins. Co., 909 F Supp 775 (1996), decided one year after McGanty. There, she held that “there is no cogni-zable claim for the reckless infliction of emotional distress under” Oregon law. More recently, Judge Ashmanskas pro-vided a lengthy discussion in Navarette v.

Nike concerning intentional infliction of emotional distress and its relationship to recognizable claims for reckless infliction of emotional distress. Navarette v. Nike, 2007 U.S.Dist Lexis 6323.

Snead involved an employment claim that alleged the defendant caused plaintiff emotional distress by failing to act upon her request for assistance at work. The court held that the acts of defendant were not intentional but rather reckless. From that conclusion, the court further held that the IIED claim failed due to insufficient intent and that the plaintiff was precluded from bring-ing her action by the exclusive remedy provisions of the Workers’ Compensation Act. Therefore, if you are faced with an employment claim for IIED and you suc-cessfully move to dismiss the claim on the basis that the acts are simply reckless, you may win the war on the basis that workers’ compensation statutes preclude the claim.

In conclusion, counsel defending against IIED claims should look for op-portunities to argue that the conduct alleged was merely reckless and that therefore the claim should be dismissed while bearing in mind that, in certain fact situations, a claim for reckless infliction of emotional distress may exist outside

the confines of the tort of IIED. In ad-dition, when moving against an IIED claim in the context of an employment lawsuit, you may buttress your position

with the argument that, if the court finds the conduct is merely reckless, the claim is barred by the workers’ compensation statutes. J

INTENTIONAL INFLICTION OF EMOTIONAL DISTRESScontinued from page 8

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FEATURES


he Oregon Court of Appeals’ recent decision in Bell v. Public Employees Retirement Board (decided December 1, 2010, available at 2010 WL 4867554) may help defense

attorneys defend against negligence claims for pure economic loss. This article will discuss the application of the Bell decision to construction defect cases; in

that context, Bell may help developers defend against homeowner as-sociations’ claims for negligent misrepresen-tation and breach of fiduciary duties.

Oregon courts de-fine pure economic loss-

es as “financial losses to intangibles,” as opposed to “damages for injury to person or property.” Harris v. Suniga, 209 Or App 410, 149 P3d 224 (2006). A negligence claim for pure economic loss typically requires the plaintiff to prove that a stat-ute, rule, or a special relationship created a heightened duty of care (Hale v. Groce, 304 Or 281, 284, 744 P2d 1289 (1987)); Abraham v. T. Henry Construction, Inc., 230 Or App 564, 217 P3d 212 (2009)). In Bell, plaintiff was a member of the Public Employees Retirement System (PERS). She alleged that the Public Employees Retire-ment Board (PERB) negligently misrepre-sented her retirement benefits, and that she relied on PERB’s estimates, retired from her job, and ultimately received PERS benefits that were lower than anticipated. Plaintiff argued that the legislature cre-ated tort liability when it created PERB, and further, that the requisite special relationship existed between herself and

PERB in that PERB managed her retire-ment benefits and essentially oversaw her financial well-being.

The Bell court needed to determine two issues: 1) whether the legislature intended to create tort liability when it created PERB, and 2) whether a special relationship with heightened duties of care existed between plaintiff and PERB. The first issue required an analysis of the legislature’s intent. Wild Rose Ranch Enterprises v. Benton County, 210 Or App 166, 171, 149 P3d 1281 (2006). In Bell, the court held—citing language in the statute that essentially notified PERS members not to rely on PERB’s estimates—that the legislature did not intend to create tort liability when it created PERB. Then, regarding the special relationship as-serted by plaintiff, the court examined the statutory duties and responsibilities PERB assumed when it managed PERS in light of the elements required for such a relationship, as established by case law: (1) the plaintiff relinquishes control over matters; (2) the plaintiff entrusts the mat-ters to the defendant; (3) the defendant is authorized to exercise independent judg-ment to further the plaintiff’s interests; and (4) the relationship resembles other relationships “in which the law imposes a duty on parties to conduct themselves rea-sonably, so as to protect the other parties to the relationship.” Onita Pacific Corp. v. Trustees of Bronson, 315 Or 149, 159, 843 P2d 890 (1992). The court also noted that when a relationship is created and defined by statute, common law special relation-ships do not trump the legislature’s intent. As with the issue of tort liability, the Bell court’s analysis of the statutory framework led to a finding that the legislature effec-

tively disclaimed any PERB duty to provide binding retirement estimates, and there-fore, there was no special relationship as plaintiff alleged.

Bell focused on two additional impor-tant points. First, the court emphasized that the pertinent statutes required PERB to act in the best interest of all members, not individual members, and that there-fore a special relationship did not exist between PERB and individual members. Second, the court noted that pure econom-ic loss damages must flow from the specific special relationship duties. Since plaintiff’s allegation involved negligent estimates of her retirement funds, the statutory duty did not flow from the special relationship that plaintiff alleged. The special relation-ship alleged in Bell merely required PERB to prudently manage retirement funds, and the Court held that “it does not follow that the relationship is special with respect to other duties.”

The Bell case thus offers an impor-tant guide to the economic loss doctrine. Specifically, defense attorneys should ask the following questions: 1) does the statute create tort liability; 2) if not, did the legislature nonetheless create a spe-cial relationship with heightened duties of care; 3) who are the parties to the alleged special relationship; and 4) does the alleged breach directly relate to the heightened duties of care. Economic Loss Claims in the Construc-tion Defect Context

In construct ion defect cases , homeowner associations often allege pure economic loss damages against developers through claims of negligent misrepresentation and breach of fiduciary duty. They allege that statutory duties

Applying Bell to Construction Defect CasesRobert E. SinnottSmith Freed & Eberhard PC

Robert Sinnott

T


11

FEATURES


create tort liability and also form a special relationship between the developer and homeowners . For example, a typical developer will control the homeowner association for a period of time before turning over control to the initial homeowners. See, e.g., Oregon Condominium Act, ORS 100.175 and ORS 100.200. This period of control—during which the developer must budget reserves, assess homeowners, and generally ensure the upkeep of the property—frequently forms the basis for homeowner associations’ negligence claims for pure economic loss damages.

Courts must therefore determine two issues: 1) whether the pertinent statutes themselves (e.g., the Oregon Condominium Act) create tort liability, and 2) whether the developer’s control over the homeowner association creates a special relationship with heightened

duties of care. Defense attorneys regularly argue that the Oregon Condominium Act and similar statutes do not create independent tort liability, and the Bell decision bolsters those arguments. On the issue of the special relationship, the responsibility of developers to act for the entire homeowner association (not just individual homeowners) before turnover is arguably similar to PERB’s duty, highlighted by the Bell court, to act for all PERS members, not individual members. Homeowner associations typically sue derivatively for negligent misrepresentations that occurred when individual homeowners purchased their units from the developer. But, even if a special relationship exists between the homeowner association and the developer, there is no corresponding special relationship between the developer and individual homeowners.

The Bell court’s emphasis on the requirement that pure economic loss damages flow from the specific special relationship duties is also useful in the construction defect context. Although the heightened duty of care typically arises out of the developer’s control of the homeowner association before turnover, the alleged misrepresentation typically occurs when the developer sells the home to the individual homeowner. Depending on how the homeowner association words its complaint, there is usually no relation between the duty breached and the spe-cial relationship.

Since insurance policies frequently do not cover pure economic loss claims, the Bell decision may be important for defense at-torneys. In the construction defect context, Bell may help developers defend against homeowner associations’ negligence claims for pure economic loss damages. J

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FEATURES


n many intra-business legal disputes, statutory remedies require or permit courts to order the purchase of a party’s ownership in the business organization for

its “fair value.” This article provides a brief summary of the circumstances in which that remedy arises, an explanation of the “fair value” determination, and suggestions for lawyers litigating a fair value case.

When payment of fair value is re-quired

A number of Oregon statutes require or permit a court to order the purchase of a party’s ownership interest in a busi-ness organization for its fair value. For example:

• Dissenters’ Rights. A shareholder exercising the right to dissent from certain corporate actions pursuant to ORS 60.551 through 60.594 or 60.813 is entitled to have his or her shares purchased by the corporation for their fair value.

• Close Corporation Disputes. Un-der ORS 60.952, certain disputes between shareholders in a close corporation may result in a court order that a party purchase the ag-

grieved shareholder’s shares for their

fair value, or in an election by the

corporation or one or more share-

holders to terminate the aggrieved

shareholder’s action preemptively by

purchasing his or her shares for their

fair value.

• Judicial Dissolution Actions. Oregon

courts have exercised the inherent

authority to order a buyout for fair

value as a less drastic remedy when

a shareholder sues for judicial dis-

solution of a corporation under ORS

60.661.

• Separation from LPs and LLPs. A

limited partnership must purchase

the interest of a withdrawing lim-

ited partner for its fair value unless

the partnership agreement provides

otherwise, and a limited liability

partnership must purchase the inter-

est of a disassociated partner for its

fair value, if the withdrawal does not

result in the dissolution of the part-

nership. ORS 70.255(2); ORS 67.250.

What is “fair value”?“Fair value” is defined only once in

Oregon’s business organization statutes,

and that definition is limited to dissent-

ers’ rights cases. With some exclusions,

“fair value” in the context of dissenters’

rights means “the value of the shares im-

mediately before the effectuation of the

corporate action to which the dissenter

objects.” ORS 60.552(4). As one court

observed, that definition of fair value

“is hardly self-executing in its clarity.”

Columbia Mgmt. Co. v. Wyss, 94 Or App

195, 199, 765 P2d 207 (1988), rev den 307

Or 571 (1989), quoting O’Connor Appeal,

452 Pa 287 291, 304 A2d 694 (1973). How-

ever, the lack of statutory clarity is appar-

ently by design: the official comments to

the Model Business Corporation Act, the

source of Oregon’s statute, states that

the definition “leaves to the parties (and

ultimately the courts) the details by which

‘fair value’ is to be determined within

the broad outlines of the definition.” It

follows that “[w]hat is fair value necessar-

ily depends on the circumstances of the

particular case.” Columbia Management

Co., 94 Or App at 202.

Despite the malleable nature of

the “fair value” determination, some

guidance is found in Oregon appellate

decisions. The first point might be the

most obvious, but should be acknowl-

edged: “fair value” does not mean “fair

market value.” Columbia Mgmt. Co., 94

Or App at 202. Principles applied in the

determination of fair market value often

form the foundation of a fair value de-

termination, but they are neither binding

nor exclusive. Id.

Most courts start their fair value

determination by considering the tra-

ditional approaches to determining the

fair market value of a business – market

Litigating the “Fair Value” of a Business OrganizationC. Robert SteringerHarrang Long Gary Rudnick PC

C. Robert Steringer

I


13

FEATURES


value, net asset value and earnings or

investment value – with the relative

weight of each depending on the cir-

cumstances of the case. An explanation

of those methods is beyond the scope of

this article, but it is important to know

when working with a valuation expert

that courts view investment or enterprise

value as “the most important factor in

most cases . . . because that value reflects

the business’ worth as a going concern.”

Id. at 201.

Most courts, including those in Or-

egon, depart from fair market value prin-

ciples when it comes to discounts. In cases

determining the fair value of the stock of

an oppressed shareholder, Oregon courts

decline to apply a minority discount (re-

flecting the diminished value of shares

not constituting a controlling interest in

a corporation) or marketability discount

(reflecting the diminished value associ-

ated with the lack of a public market for

the shares of a particular corporation).

See Hayes v. Olmsted & Assoc., Inc., 173

Or App 259, 280, 21 P3d 178, rev den, 333

Or 73 (2001).

Tips for litigating a “fair value” caseCases involving determination of

the fair value of a business organization

involve unique challenges and the oppor-

tunity to exercise creativity in an area of

the law that is still developing. Following

are five tips to consider when litigating a

fair value case.

First, determine early in the litigation

which procedure the court intends to use

to determine the fair value of ownership

interests should it become necessary to

do so, and whether you should advocate

for a particular process. In most cases,

the parties litigate fair value in a trial set-

ting, presenting competing evidence and

valuation expert opinions. In some cases,

however, a trial court hires an appraiser

and makes the value determination on

its own without further input from the

parties. See Marker v. Marker, 238 Or

App 65, 242 P3d 638 (2010) (affirming

trial court’s denial of one party’s request

to offer evidence and cross-examine the

appraiser used by the court). Obviously,

those two processes require very different

approaches to the litigation.

Second, engage a valuation expert

early on—before starting discovery.

Otherwise, you risk misdirecting your

discovery and other trial preparation

efforts toward information you do not

need while missing information that you

do need.

Third, recognize that your valuation

expert likely will have more experience

with fair market value appraisals than

with fair value determinations. Serena

Morones, an Accredited Senior Appraiser

in business valuation through the Ameri-

can Society of Appraisers, recommends

that counsel “obtain a preliminary valu-

ation opinion early on to identify value

indicators or assumptions in a particular

case that could cause a difference in the

value conclusion between fair market

value and fair value, other than discounts

for lack of control and lack of market-

ability.”

Fourth, consider whether to chal-

lenge the conventional wisdom that no

discounts are appropriate when deter-

mining the fair value of shares. Oregon

courts typically deny minority or market-

ability discounts when determining fair

value in oppressive conduct cases, but

different types of cases and even some

oppressive conduct cases may provide

an opportunity for a purchasing party to

argue for application of discounts – espe-

cially a marketability discount.

Finally, take advantage of the flex-

ibility afforded by the concept of “fair

value.” Counsel should look for facts that

are not typically included in an appraisal

of business interests, but which in fairness

should be considered to adjust the fair

value in one direction or another accord-

ing to the client’s interests.

Breaking up is hard to do, as the song

says. That old trope holds for business

relationships too, providing lawyers an

opportunity to deliver significant value

to clients embroiled in the litigation of

fair value. J

LITIGATING “FAIR VALUE”continued from page 12

14

ASSOCIATION NEWS


OCTO

Contributions for The Verdict are al-ways welcome. For our Spring 2011 edition, please send your articles no later than:

April 1, 2011

Submissions may be sent to:Jeanne Loftis, Editor in ChiefBullivant Houser Bailey PC888 SW 5th Ave., #300Portland, OR 97204503/[email protected]

Please email your articles in either WordPerfect or Microsoft Word for-mat (preferred). J

Calendar

Association NewsDeadline

New Members

Ned Arenberg Frohnmayer, Deatherage

Angela Bennett Bodyfelt, Mount

Stuart FordThe Ford Law Firm, LLC

Ryan LeeScheer & Zehnder LLP

Jason PossLachenmeier Enloe Rall & Heinson

OADC welcomes the

following new members to

the association:

WorkshopApril 20, 2011Attracting & Retaining Diverse Talent at Defense FirmsPortland, OR

2011 OADC Convention*June 23-26, 2011Sunriver, OR

Defense Practice AcademyDepositions

September 2011Portland, OR

Fall SeminarOctober 28, 2011Portland, OR

Ethics SeminarDecember 9, 2011Portland, OR

2012 OADC Convention*June 21-24, 2012Sunriver, OR

*All programs are subject to change

*The 2011 and 2012 OADC Convention

dates are an exceptionally busy time at

Sunriver and we encourage all conven-

tion attendees to book their lodging

early. You can make reservations with

Sunriver Resort at our discounted group

rates by contacting them at 800.547.3922

and asking for OADC’s Annual Conven-

tion room block. For more information

on what Sunriver Resort has to offer, visit

their website at www.sunriver-resort.com.

The OADC website, www.oadc.com, has many enhanced

features including: our passcode protected on-line member-

ship directory, enhanced calendar of events that allow on-line registration for

CLE events, enhanced OADC leadership listings, ability to update your mem-

bership data with OADC on-line, on-line membership application, on-line

dues renewal, amicus briefs that OADC has filed, expert witness information,

legal updates and tips, newsletters (for members only), and more!

To be a part of our active, members only, listserve please send an email

to [email protected] with a request to be added to the email listserve along

with your name. Once your membership is verified by OADC staff, you will

be added to the listserve and a welcome letter will be emailed to you with

instructions on how to use the listserve.

We hope you enjoy the site and find it a useful tool and benefit. Please

email us at [email protected] or call OADC at 503.253.0527 or 800.461.6687 with

questions. J

OADC Website

Calendar

15

RECENT CASE NOTES


Recent Case Notes


Plaintiff in training to be-come a minister may not invoke the protections of state wage laws

In Alcazar v. Corporation of the Cath-

olic Archbishop of Seattle, 627 F3d 1288

(9th Cir (WA) 2010) (en banc), the Ninth

Circuit Court of Appeals addressed the

intersection of First Amendment rights

and state employment laws, and held

a seminarian is exempt from minimum

wage and overtime rules when employed

in the scope of ministry training.

Plaintiff attended a seminary to

become a Catholic priest. As part of his

preparation for ordination, plaintiff

was assigned to work at St. Mary Parish,

where he performed maintenance and

assisted with Mass. Plaintiff eventually

sued for overtime pay under Washington

state’s Minimum Wage Act. The district

court granted judgment on the pleadings

against that claim, and denied plaintiff’s

motion to amend to allege a minimum

wage claim, because it found plaintiff’s

employment fell within the ministerial

exception. The Ninth Circuit affirmed.

State and federal employment laws

generally apply to churches, but the

federal courts have acknowledged a

ministerial exception to this general rule.

The ministerial exception arises from the

First Amendment’s prohibition against

any laws “respecting an establishment of

religion, or prohibiting the free exercise

thereof.” A church’s employment of an

ordained minister or priest clearly falls

within the exception. In Alcazar, the

Ninth Circuit held that the ministerial

exception also applies to a person who,

although not yet a minister, performs

work as part of the training to become

a minister through a church-recognized

seminary program.

In affirming the district court’s judg-

ment, a three-judge panel of the Ninth

Circuit defined a new test for determin-

ing whether a person is a “minister” with-

in the ministerial exception. On en banc

review, the full Ninth Circuit affirmed,

but did not adopt the test outlined by

the panel. Unlike other circuits, the Ninth

Circuit has not yet defined a general test

for the ministerial exception. It declined

to do so again here because such a test

was unnecessary to determine if the

exception applied to plaintiff. Plaintiff’s

complaint alleged that he had performed

his work at St. Mary Parish as part of his

seminary program to become a priest.

The Ninth Circuit held that these affirma-

tive allegations established plaintiff was

subject to the ministerial exception under

any reasonable interpretation. J

—Submitted by Rebecca Watkins

of Sather, Byerly & Holloway, LLP

In a medical malpractice case, a comparative fault defense must be based on conduct that relates and contributes to the negligent treatment, and cannot be based on conduct that pre-ceded and created the need for treatment

In Son v. Ashland Community Health-

care Services, Oregon Court of Appeals

No. A137065 (December 15, 2010), the

court held that, in a medical malpractice

case, a comparative fault affirmative de-

fense may not be based on conduct that

originally created the need for medical

treatment.

The decedent was a 16-year-old girl

who had ingested cocaine and alcohol at

a party. Upon arriving home, she quar-

reled with her father. The decedent later

consumed an unknown quantity of pills,

including some leftover pills belonging to

her father. The next morning decedent

was incoherent and vomiting. Decedent

was taken to a hospital emergency room

and later died from a drug overdose.

The decedent’s estate brought a

wrongful death action against, among

others, two doctors who treated dece-

dent. The doctors alleged comparative

fault defenses against both the decedent

and the father. The comparative fault de-

fense against the decedent alleged that

the decedent had caused or contributed

employment medical malpractice

16

RECENT CASE NOTES


Recent Case Notes


to her death by consuming a variety of

substances that eventually led to her

death. The comparative fault defense

against decedent’s father alleged that

he had negligently left pills unsupervised

in the home, and that he had failed to

supervise the decedent at the party.

Before trial, the court struck the

comparative fault defense against the

decedent, but allowed the comparative

fault defense against the father to be

submitted to the jury. The jury’s verdict

included an assignment of fault to the

father. Among the issues on appeal was

whether the comparative fault defenses

against the decedent and the father,

based on conduct that preceded and led

to the decedent’s need for medical treat-

ment, alleged cognizable comparative

fault affirmative defenses.

In professional malpractice cases, a

plaintiff must prove (1) a duty that runs

from the defendant to the plaintiff;

(2) a breach of that duty; (3) a result-

ing harm to the plaintiff measurable in

damages; and (4) a causal link between

the breach and the harm. With respect

to the element of harm, the focus in a

medical malpractice case is on the injury

caused by the negligent treatment, not

the original injury that created the need

for treatment.

The court of appeals held that the

affirmative defenses alleged against the

decedent and the father were both im-

proper because both related to conduct

that originally created the need to seek

medical treatment. Those defenses were

improper because “a valid defense of

comparative fault in medical malprac-

tice cases requires that the . . . negligent

conduct relate and contribute to the

negligent treatment, because it is the

negligent treatment that causes the in-

jury that is at issue.” Conversely, conduct

that leads to seeking medical treatment

is not a proper basis for a comparative

fault defense. J

—Submitted by Bryana Sack

of Bodyfelt Mount, LLP

Summary judgment was im-proper where there was evi-dence that decedent had been exposed to raw asbestos fibers supplied by defendant

In Griffin v. Allis-Chalmers Corpo-

ration Product Liability Trust, 240 Or

App 137 (2010), a products liability and

negligence case involving asbestos, the

Oregon Court of Appeals reversed a

summary judgment, finding that there

was evidence from which a jury could

find that decedent had been exposed

to and inhaled asbestos fibers supplied

by defendant Union Carbide. The court

also rejected defendant’s argument that

it was insulated from liability under the

“raw material supplier” doctrine.

This case involved claims that plain-

tiff’s decedent developed mesothelioma

due to exposure to raw asbestos supplied

by defendant Union Carbide. Plaintiff

presented evidence that decedent, a

long-haul truck driver, visited a U.S.

Gypsum manufacturing plant two to four

times per year, for a total of 15 to 20 trips.

Plaintiff also presented evidence that

during the time that decedent visited the

plant, Union Carbide had supplied large

amounts of raw asbestos for use in U.S.

Gypsum’s manufacturing processes; that

decedent stood inside U.S. Gypsum’s plant

and was exposed to dusty air; that an un-

named expert testified that decedent’s

exposure to others working in the plant

caused respirable asbestos fibers supplied

by Union Carbide to be released into the

air that decedent was breathing; and that

decedent’s exposure to those fibers was

a substantial factor in causing decedent’s

mesothelioma.

Union Carbide argued there was

insufficient evidence to establish that its

raw asbestos caused decedent’s illness.

But the court of appeals held that estab-

lishing the presence of Union Carbide’s

asbestos in decedent’s workplace was

sufficient to create a triable issue as to

whether decedent’s injuries resulted from

exposure to defendant’s asbestos.

Union Carbide also argued that it

was insulated from liability under the

“raw material supplier” doctrine. The

court rejected this argument because

decedent’s claim involved exposure to

raw asbestos fibers supplied by Union

Carbide rather than a finished product

containing the raw asbestos fibers as a

component part. J

—Submitted by Jennifer Durham

of Hiefield Foster & Glascock LLP

products liability

17

RECENT CASE NOTES


Recent Case Notes

Parties can settle after a verdict but before a judgment to prevent the state from recovering 60 percent of a punitive-damage award

In Patton v. Target Corp., 349 Or 230, 242 P3d 611 (2010), the Oregon Supreme Court held that Oregon’s “split recovery” statute (ORS 31.735) does not prevent parties to a punitive-damages verdict from settling before entry of judgment on terms that have the effect of reduc-ing or eliminating the share of punitive damages that the state would otherwise be entitled to recover.

Since 1987, Oregon has had a “split recovery” statute that requires part of any punitive damages award to be paid to the state’s crime victim compensation fund. Currently, ORS 31.735 provides that the state is a “judgment creditor” as to 60 percent of a punitive damages “verdict.”

In Patton, plaintiff brought wrongful discharge claims under both federal and state law against his employer. Plaintiff received a verdict on his state-law claim that included $900,000 in punitive dam-ages. After the verdict but before entry of a judgment, plaintiff and defendant entered into a confidential settlement that did not include any payment of pu-nitive damages. At the parties’ request, the trial judge then entered a judgment of dismissal.

The state intervened, seeking to undo the settlement and dismissal, argu-ing that the split recovery statute pre-

vented the parties from settling on terms

that thwarted the state’s interest in the

punitive damages award. The trial judge

denied the state’s motion for relief from

the judgment. The state appealed to the

Ninth Circuit, which in turn certified this

question of law to the Oregon Supreme

Court: Is the state’s consent necessary

before the court enters a judgment of

dismissal following a settlement that

reduced or eliminated the share of puni-

tive damages to which the state would

otherwise be entitled under ORS 31.735?

Patton v. Target Corp., 580 F3d 942 (2009).

The Oregon Supreme Court an-

swered the certified question “no.” The

court acknowledged that the legislature

amended ORS 31.735 in 1995 with the

intent to avoid the very situation that

arose in Patton – a settlement, made after

verdict and before judgment, that elimi-

nated the state’s share of the punitive

damages award. But the court held that

the legislature’s words failed to achieve

that goal, and that the statute’s wording

compelled the court to conclude that

the state had no power to prevent the

settlement. ORS 31.735(1) states in rel-

evant part: “Upon the entry of a verdict

including an award of punitive damages,

the Department of Justice shall become

a judgment creditor as to the punitive

damages portion of the award.” The

supreme court held that the state as a

“judgment creditor” has no enforceable

interest before entry of a judgment, and

in particular no enforceable interest in

a verdict, even if that verdict includes

punitive damages. Notwithstanding the

intention of the legislature, the state thus

had no ability to undo the settlement and

judgment of dismissal.

Patton means that parties subject

to a punitive damages verdict can settle

in advance of judgment to prevent the

state from recovering 60 percent of the

punitive damages award. J

—Submitted by Lori Irish Bauman

of Ater Wynne LLP

The ratio between punitive damages and compensatory damages may exceed single digits where the compensa-tory damages are low

In Hamlin v. Hampton Lumber Mills,

Inc., Oregon Supreme Court No. S056700

(January 6, 2011), the Oregon Supreme

Court held that a punitive damages

award of $175,000 in a case in which

compensatory damages were only $6,000

did not violate the Due Process Clause of

the United States Constitution.

The plaintiff was a temporary em-

ployee who injured his hand while work-

ing at the defendant’s mill. Plaintiff was

unable to work for several months and

filed a safety complaint with the Oregon

Occupational Safety and Health Admin-

istration (OSHA). When plaintiff later

sought reinstatement at the mill through

his temporary agency, as required under

ORS 659A.043, defendant refused to re-

instate him and falsely asserted that he

was a safety risk.

The jury awarded plaintiff $6,000

in lost wages and $175,000 in punitive

damages. The trial court declined to

reduce the punitive damages award, but

the court of appeals held that the award

was unconstitutionally excessive because

the ratio of nearly 30:1 between punitive

and compensatory damages was much

greater than the limit of 4:1 set by the

United States Supreme Court for cases

involving only economic harm.

punative damages


18

RECENT CASE NOTES


Recent Case NotesThe Oregon Supreme Court consid-

ered three guideposts: the degree to

which the defendant’s conduct was rep-

rehensible, the ratio between punitive

damages and compensatory damages,

and statutory penalties for comparable

misconduct.

The court’s opinion primarily in-

volved the ratio guidepost. On that

issue, the court said the U.S. Supreme

Court had not prescribed any rigid

formula, and had acknowledged that

higher ratios may be acceptable in

certain cases. In particular, the court

cited Exxon Shipping Co. v Baker, 554

US 71, 494, 128 S Ct 2605, 171 L Ed 2d

570 (2008), for the principle that higher

ratios may be appropriate when the

compensatory award is small. The court

declined to draw a bright line between

“small” and “substantial” compensatory

damage awards. The court did note,

however, that it generally characterized

awards of less than $25,000 as “rela-

tively small.” It also observed that other

courts had generally held in cases with

compensatory awards of $12,000 or less

that punitive damage awards in excess

of single-digit ratios were not grossly

excessive. Finally, the court reasoned

that the actual ratio of punitive to com-

pensatory damages was approximately

22:1, taking into account prejudgment

interest. The court concluded that in this

case, where the compensatory damage

award was “small,” a 22:1 ratio did not

offend constitutional due process.

With respect to the first guidepost

– whether defendant’s conduct was rep-

rehensible – the court held that defen-

dant’s conduct was more than minimally

reprehensible. The court relied on three

subfactors: that plaintiff was financially

vulnerable, that defendant committed

deceit, and that the Oregon legislature

had indicated its interest in protecting vulnerable workers through the enact-ment of ORS 659A.043.

The court found that the third guidepost – comparable statutory penalties – was not significant because Oregon law does not provide any statu-tory penalties for a violation of ORS 659A.043.

Finding that the punitive damages award was not constitutionally exces-sive, the court reversed the decision of the court of appeals and reinstated the judgment for the full amount of the pu-nitive damages awarded by the jury. J

—Submitted by Caroline Harris

Crowne of Tonkon Torp LLP

Recreational immunity statute bars plaintiff ’s claim for personal injuries suffered while driving on private road owned by Bureau of Land Management

In Kelly v. Hochberg, 349 Or 267, 243 P3d 62 (2010), the Oregon Supreme Court held that the recreational immu-nity statute barred plaintiff’s claim for personal injuries suffered while driving a motorcycle on a private road owned by the Bureau of Land Management.

Plaintiff attended a motorcycle rally that included a Poker Run, an event in which riders traveled a predetermined course while collecting playing cards at intermediate stops before returning to the starting point to compare hands.

While riding his motorcycle on a road owned by the Bureau of Land Manage-ment, plaintiff was injured in a collision with an automobile.

The issue on appeal was whether plaintiff’s actions were subject to Ore-gon’s recreational use statute. That stat-ute grants a landowner immunity from tort liability for personal injuries when the landowner “permits any person to use the land for recreational purposes” without charge. ORS 105.682(1). Plain-tiff argued that the statute did not apply because he was engaged in “travel,” and not a “recreational purpose,” at the time of the accident.

The court held that recreational purposes can include travel, and that the Poker Run was a recreational pur-pose within the meaning of the statute because plaintiff was traveling as part of participating in a card game.

Plaintiff also argued that the recre-ational use statute did not apply because the accident occurred on a public road and that it would be absurd to apply the recreational use statute to recreational activities occurring on a public road. The court rejected that argument on the grounds that the accident occurred on a private governmental road and not a public road. The court noted that, although the BLM opened the road for public use, it also had the right to close its roads to meet BLM management objectives, which is a characteristic not found with public roads. Consequently, plaintiff’s arguments based on the prem-ise that the accident occurred on a public road were unavailing. J

—Submitted by R. Daniel Lindahl

of the Lindahl Law Firm, PC

recreational use immunity


19

RECENT CASE NOTES


Recent Case Notes

Trial court erred by allow-ing counsel to explain dur-ing closing argument why a witness had not been called to testify, where counsel’s remarks were not based on evidence in the record

In Cler v. Providence Health System-

Oregon, Oregon Supreme Court No. S056715 (December 30, 2010), a divided Oregon Supreme Court held that the trial court abused its discretion by allow-ing defense counsel to explain, during closing argument, why a witness had not testified at trial, where the reasons the witness had not testified were not facts within the record. The court also held that counsel’s improper argument substantially affected plaintiffs’ rights, warranting reversal for a new trial.

This case involved claims that de-fendant Oregon Hematology Oncology Associates was liable for injuries resulting from the negligence of one of its nurses. In her opening statement, defense coun-sel told the jury that she would be calling an oncology nurse to testify as an expert, and that this nurse would testify that defendant’s nurse had met the standard of care. During trial, however, defense counsel did not call this expert to testify because the witness became unavailable before defendant was able to put her on the stand.

Despite knowing the true reasons why the nurse had not testified, during closing argument, plaintiffs’ counsel pointed out that the nurse had not testi-

fied, and argued that the nurse’s failure to testify was because she could not sup-port the care provided by defendant’s nurse. In closing argument defense counsel responded, over plaintiffs’ objec-tion, by telling the jury that she had an oncology nurse manager who had been waiting in the courtroom to testify, but that the nurse had become unavailable to testify before defendant was able to put the nurse expert on the stand. Counsel further stated that the nurse would have supported defendant’s case. The trial judge allowed these statements and did not give a special jury instruction, but did instruct the jury that the case must be decided based on the evidence, and that the attorneys’ arguments are not evidence.

The jury returned a defense verdict. The Oregon Court of Appeals held that the trial court had erred by allowing de-fense counsel’s statements, but that the error did not warrant reversal.

In a 4-3 opinion, the Oregon Su-preme Court agreed with the court of ap-peals that the defendant’s closing argu-

ment was improper because it referred to evidence not in the record, including the gist of what the expert nurse would have testified. Unlike the court of appeals, however, the supreme court also held that the improper argument so substan-tially prejudiced the plaintiff that a new trial was warranted. In finding reversible error, the court focused on three factors. First, it noted that the fact the defense counsel was allowed to make the argu-ment over plaintiff’s objections created the impression for the jury that defense counsel’s arguments had “received the trial court’s imprimatur.” Second, the improper statements included testimony that had never been presented. Third, the improper statements were material to the central issue in the case: whether the defendant’s nurse had complied with the applicable standard of care. Accord-ingly, the supreme court reversed the judgment and remanded the case for a new trial. J

—Submitted by Jennifer Durham

of Hiefield Foster & Glascock LLP

trial practice

20 The VerdicT ■ WinTer 2011

PETITIONS FOR REVIEW

Pending Petitions For ReviewThe following is a brief summary of cases for which petitions for review have been filed with the Oregon

Supreme Court. These cases have been selected for their possible significance to OADC members;

however, this summary is not intended to be an exhaustive listing of the matters that are currently

pending before the court. For a complete itemization of the petitions and other cases, the reader is

directed to the court’s Advance Sheet publication.

Petitions for Review That Have Been Allowed

Advance Payment Statute■ Snyder v. Espino-Brown, 235 Or App 82, rev allowed, 349

Or 171 (2010) (argued before the Oregon Supreme Court

on January 14, 2010).

This case involves the statute of limitations for personal

injury claims under the advance-payment statute (ORS 12.155)

when an insurer makes an advance payment to one of multiple

co-owners of damaged property.

Plaintiff was injured in an automobile accident with defen-

dant. At the time of the accident, plaintiff was in a car jointly

owned by herself and her husband. The car was damaged in

the accident.

A few months after the accident, defendant’s insurer sent

plaintiff’s husband an advance payment for repairs to the car.

At the time of the payment, the insurer did not provide notice

of the date that any claims related to the accident would expire

under the statute of limitations. The insurer later sent a letter

to plaintiff’s husband stating that, due to its failure to provide

the husband with notice of the limitations period on his claims,

he had an extended period of time to commence an action be-

fore the limitations period expired. Plaintiff was not included

on either the advance payment or the subsequent letter giving

notice of the extended limitations period.

Plaintiff filed an action for personal injuries suffered in the

accident. The action was commenced after the two-year limita-

tions period had expired, but before expiration of the extended

period referenced in the insurer’s letter to plaintiff’s husband.

The circuit court dismissed plaintiff’s action on the grounds

that it was time-barred. But the court of appeals reversed,

holding that plaintiff’s action was timely because the advance-

payment statute extended the statute of limitations. The

advance-payment statute says that the limitations period is

not extended “If the person who makes an advance payment

… gives to each person entitled to recover damages for death,

injury or destruction, not later than 30 days after the date of

the first of such advance payments was made, written notice

of the date of expiration of the period of limitation for the

commencement of an action for damages set by the applicable

statute of limitations[.]” The court of appeals held that the

advance payment to plaintiff’s husband was also for plaintiff’s

benefit because she was a joint owner of the car. Consequently,

because the advance payment was not accompanied by notice

of the limitations period, the advance payment tolled the limi-

tations period for plaintiff’s claim.

The supreme court granted review, and the issue on review

is whether an advance payment to a person on his or her claim

for property damage tolls the statute of limitations for personal

injury claims brought by co-owners of the property, if the in-

surer did not provide notification of when those claims would

become time-barred?


21The VerdicT ■ WinTer 2011


Agency■ Eads v. Borman and Willamette Spine Center, LLC, 234 Or

App 324, rev allowed, 349 Or 173 (2010) (scheduled for oral

argument before the Oregon Supreme Court on March 1,

2011).

Relying upon theories of actual agency and apparent

agency, plaintiff alleged that the defendant, a commercial

landlord, was vicariously liable for medical malpractice allegedly

committed by a doctor who was an occupant in the defendant’s

building. The court of appeals affirmed summary judgment for

the defendant, finding no facts from which a reasonable finder

of fact could conclude that the doctor was the landlord’s actual

or apparent agent. On review, the issue is whether an entity

that allegedly promotes itself as a group medical practice is li-

able for the negligence of one of the medical practitioners who

purportedly appears to be part of the group practice, under

principles of apparent agency law.

Attorney Fees■ Menasha Forest Products Corp. v. Curry County Title, Inc.,

234 Or App 115, 227 P2d 770, rev allowed, 348 Or 669 (2010)

(argued before the Oregon Supreme Court on November

10, 2010).

This case involves the extent to which a party is entitled to

recover attorney fees where the party’s fees have been paid by

a third-party.

Plaintiff sold land to Golden Gate Trust, but some of the

land had previously been sold to another buyer. Golden Gate’s

title insurer, Transnation Title Insurance Company, informed

plaintiff that it would seek reimbursement from plaintiff if

Transnation had to pay a claim arising from plaintiff’s failure

to convey good title.

Plaintiff then brought a declaratory judgment action against

both Transnation and the escrow company, Curry County Title.

Plaintiff sought a declaration that it would have no obligation

to reimburse Transnation if Transnation followed through on

its demand. The trial court granted summary judgment against

plaintiff’s claim on the grounds it was not justiciable. The court

also awarded defendants almost $31,500 in attorney fees.

The court of appeals held that plaintiff was responsible for

only $2,500 in attorney fees. The contract between plaintiff and

Curry County Title provided for attorney fees to the prevailing

party in any action between parties to the escrow. But Curry

County Title’s agreement with Transnation made Transnation

responsible for paying Curry County Title’s attorney fees in excess

of $2,500. The court of appeals held that since Curry County Title

was responsible for only $2,500 in attorney fees, that was all it

had incurred, and that was all plaintiff could be made liable for.

On review, the issue is whether a party is entitled to recover

attorney fees actually expended in the defense of the claims

against that party, if the attorney fees were paid by a third party

pursuant to that third party’s contractual indemnity agreement

with the party.

Construction■ Abraham v. T. Henry Corp., 230 Or App 564, 217 P3d 212

(2009), rev allowed, 348 Or 523 (2010) (argued before the

Oregon Supreme Court on November 8, 2010).

This case involves issues concerning whether a construction

contractor may be held liable for negligence based on violations

of applicable building codes.

Plaintiffs own a home built for them by several contractors

and subcontractors. After plaintiffs discovered damage alleg-

edly caused by water leakage, they sued defendants for breach

of contract, negligence, and negligence per se.

The trial court dismissed the breach of contract action based

on the statute of limitations. The court dismissed the negligence

claims because plaintiffs lacked a “special relationship” with

defendants, which prevented them from recovering on their

negligence claims because a party to a contract generally can-

not bring a tort claim against the other party unless the claim

arises from the breach of some standard of care independent

from the terms of the contract.

The court of appeals affirmed the dismissal of the breach

of contract claim. The court of appeals also agreed that there

was no special relationship between plaintiffs and defendants.

But the court held that the Oregon Residential Building Code

provided a standard of care independent of the contract and

could be the basis for a negligence claim based on negligence

per se. Accordingly, the court of appeals reversed and remanded

the negligence claim.

The Oregon Supreme Court has granted review and identi-

fied these issues on review:

(1) Whether an allegation of negligence per se gives rise to a

claim for negligent performance of a contract when the

parties are not in a special relationship.

(2) If a property owner alleges that a contractor violated

the “building code,” whether the property owner has a

negligence claim when the contract between the parties

expressly required the contractor to follow all building

codes.

(3) If a property owner may bring a claim for negligence per se

against a contractor in the absence of a special relationship,

whether the property owner, in response to a motion for

summary judgment, is required to specify the legal obliga-

tion that the contractor allegedly violated, or instead may




rely on an undisclosed opinion from an unnamed expert

under ORCP 47 E.

(4) Whether the Oregon Residential Building Code sets forth a

standard of care independent from the contract between

a property owner and a contractor or subcontractor, and

thus permits imposition of negligence liability, when the

parties’ contract expressly requires compliance with all

building codes.

Insurance■ Bresee Homes, Inc. v. Farmers Insurance Exchange, 227 Or

App 587, rev allowed, 347 Or 533 (2010) (argued before

the Oregon Supreme Court on May 13, 2010).

Plaintiff Bresee Homes, Inc., seeks review of a court of

appeals decision that affirmed a trial court decision granting

summary judgment to defendant Farmers Insurance Exchange

on plaintiff’s complaint against defendant for failure to defend

and denial of coverage.

Plaintiff is engaged in the business of constructing homes.

Some of the homes that plaintiff built developed problems

related to the use of synthetic stucco siding, which gave rise

to claims by the homeowners. Plaintiff sought coverage under

its policy with defendant, which defendant denied. Plaintiff

subsequently filed a complaint alleging that defendant had

breached the insurance contract by failing to defend plaintiff

and by denying coverage.

The circuit court granted defendant’s motion for summary

judgment, holding that coverage was excluded by the policy’s

exclusion for “products – completed operations.” That exclu-

sion was defined as including all property damage “occurring

away from premises you own or rent and arising out of ‘your

product’ or ‘your work’” except for “[p]roducts that are still

in your physical possession” or “[w]ork that has not yet been

completed or abandoned.”

On appeal, the court of appeals affirmed. The court held:

(1) the term “your work” in the contract included the work per-

formed by plaintiff’s subcontractor because the term included

work done on behalf of plaintiff; (2) the “products – completed

operations” exclusion excluded coverage unless an exception

to the exclusion applied; (3) plaintiff had the burden to show

that an exception to the exclusion applied, and failed to meet

that burden because it produced no evidence that the damage

alleged in the complaint occurred before completion of the

work; (4) extrinsic evidence of the parties’ intent is not part of

the interpretation of an insurance policy under Oregon law,

either to create or explain ambiguities under the policy; and (5)

the doctrine of waiver does not apply in circumstances where

a plaintiff seeks to expand the coverage of an insurance policy,

because such an expansion would not be a relinquishment of

an insurer’s rights.

On review, the issues are as follows:

(1) Whether an insured, in trying to establish a duty to defend

under an insurance policy, has the burden of producing

evidence beyond that contained in the pleadings and the

policy of insurance?

(2) Whether there is a difference between coverage for dam-

age “to an insured’s work” and “arising from an insured’s

work”?

(3) Whether endorsements, exclusions, or any other provisions

in an insurance policy should be construed independently,

or instead construed within the text and context of the

policy as a whole?

(4) Whether extrinsic evidence, particularly that which can be

characterized as an admission, may be introduced to create

an ambiguity, or submitted to the factfinder under proper

instruction?

(5) Whether an insurance company can waive the application

of an exclusion to its policy?

■ Stuart v. Pittman and Country Mutual Insurance Company,

235 Or App 196, rev allowed, 349 Or 173 (2010) (scheduled

for oral argument before the Oregon Supreme Court on

March 3, 2011)

This case involves issues arising from plaintiff’s claim for

coverage under an oral binder.

Defendant Country Mutual Insurance Company orally

bound course-of-construction coverage on plaintiff’s new resi-

dence while it was under construction. Country Mutual did not

deliver a written policy to plaintiff before the new residence

was damaged in an ice and snow storm. Relying on the usual

terms of its policy, Country Mutual denied plaintiff’s claim for

coverage. Plaintiff then sued for breach of contract, arguing

that the oral binder provided coverage different from and

broader than what was provided by Country Mutual’s usual

terms. Plaintiff also alleged that Country Mutual breached the

implied covenant of good faith and fair dealing by failing to

deliver a written policy within a reasonable time, and that if

Country Mutual had delivered a written policy within a reason-

able time, plaintiff would have seen that the written policy did

not provide the coverage he wanted, and plaintiff would have

acquired different insurance elsewhere.

A jury returned a verdict for plaintiff, but the court of

appeals reversed. The court held that there was insufficient

evidence that plaintiff and Country Mutual had come to an

agreement on clear and express terms of a binder that super-

seded the usual terms of Country Mutual’s policy. And the




court held there was no evidence that plaintiff was damaged

by Country Mutual’s failure to deliver a written policy because

plaintiff did not present evidence that he could have procured

alternative insurance providing the coverage he thought he

had under the oral binder.

The issues on appeal include:

(1) Does ORS 742.043(1) require proof that the usual terms of

the policy were explicitly superseded by clear and express

terms of the binder, or is it sufficient that the clear and

express terms of a binder implicitly superseded the usual

policy terms?

(2) Did the trial court err in submitting to the jury plaintiff’s

alternative theory, i.e., that the oral agreement to provide

coverage included an implied duty to supply the written

policy within a reasonable time and the breach of that duty

kept plaintiff from getting coverage from an alternative

source?

Medical Malpractice■ Mead v. Legacy Health System, 231 Or App 451, 220 P3d

118 (2009), rev allowed, 348 Or 669 (2010) (argued before

the Oregon Supreme Court on February 9, 2011).

This medical malpractice case presents issues concerning

whether a physician-patient privilege exists.

Plaintiff went to the emergency room complaining of

severe low back pain and weakness in her legs. The ER physi-

cian contacted defendant, who was the neurosurgeon on call

that day. Defendant conferred with the ER physician about

plaintiff’s treatment.

Plaintiff’s condition deteriorated and she eventually had

emergency surgery and was left with permanent injuries. Plain-

tiff sued defendant, alleging that his advice rendered over the

phone was negligent. Defendant contended that he could not

be liable because he did not have a physician-patient relation-

ship with the plaintiff at the time of the phone call.

At trial, the court decided that whether a physician-patient

relationship existed was a disputed issue of fact to be decided

by the jury. The jury found there was no physician-patient privi-

lege. Accordingly, the court entered judgment for defendant.

The court of appeals reversed, holding as a matter of law

that plaintiff and defendant had a physician-patient relation-

ship, and that the jury should have been given a peremptory

instruction to that effect.

The Oregon Supreme Court has granted review, and identi-

fied two issues on review:

(1) When does a physician-patient relationship arise between

an emergency room patient and an on-call neurosurgeon,

when that neurosurgeon is consulted over the telephone

by the emergency room physician?

(2) Did the court of appeals reexamine a fact determined by

the jury, in violation of Article VII (Amended), Section 3, of

the Oregon Constitution?

Negligence■ Lasley v. Combined Transport, Inc., 234 Or App 11, adh’d to

as modified on recons, 236 Or App 1 (2010), rev allowed,

Oregon Supreme Court No. S058762 (January 14, 2011)

(scheduled for oral argument before the Oregon Supreme

Court on May 2, 2011).

Trucking company spilled a load of glass on the freeway,

causing a major traffic jam. While approaching the site of the

spill, decedent was hit from behind and killed by a speeding

drunk driver. Decedent’s estate sued both the trucking company

and the drunk driver for negligence. The trucking company

moved for a directed verdict on the grounds that decedent’s ac-

cident and death were not foreseeable results of its negligence

in spilling material onto the freeway and causing a traffic jam.

The court of appeals held that the trucking company was not

entitled to a directed verdict because a reasonable juror could

find that it is foreseeable that a traffic jam will cause collisions

among cars affected by the slowed traffic. In addition, the trial

court refused to permit the trucking company to present any

evidence of the drunk driver’s intoxication. The court of appeals

reversed, holding that the intoxication evidence was relevant to

the jury’s apportionment of fault between the trucking company

and the drunk driver.

On review, the issues are:

(1) Is causation an after-the-fact determination of whether a

defendant’s conduct in fact contributed to the harm of the

plaintiff, or is it part of the “totality of potentially causative

circumstances”?

(2) Is evidence of intoxication permissible in a civil tort action,

where the operative pleadings allege only simple negli-

gence?

(3) If simple negligence (i.e., failure to maintain speed, lookout,

and control) has been admitted by a defendant, is evidence

of intoxication by that defendant permissible to compare

negligence between defendants?

(4) Does comparison of fault under ORS 31.600 allow all evi-

dence of blameworthiness, including intoxication, without

an operative pleading setting forth a theory other than

simple negligence?




Punitive Damages■ Strawn v. Farmers Insurance Company of Oregon, 228 Or

App 454, rev allowed, 347 Or 258 (2009) (argued before the Oregon Supreme Court on March 2, 2010).This case involves a class action brought by plaintiff against

defendants with respect to the payment of personal injury protection (PIP) benefits. In summary, plaintiff challenged de-fendants’ use of cost-containment software to evaluate their insureds’ medical expenses in relation to other bills for the same procedure in a given region. If defendants determined that the charge submitted by an insured’s provider exceeded a certain percentage of the range of the charges in those other bills, defendants refused to pay the excess on the ground that it was “unreasonable.” Plaintiff alleged that defendants’ review process resulted in the denial of claims for reasonable medical expenses, thereby increasing defendants’ profits at the expense of PIP claimants and medical providers.

A jury returned a verdict in plaintiff’s favor, including an award of punitive damages. The trial court ultimately entered a general judgment for plaintiff and the class he represented in the amount of $898,323.80 for compensatory damages and prejudgment interest, $8,000,000 for punitive damages, and $2,670,000 for attorney fees, plus litigation expenses and costs. Subsequently, the trial court entered a supplemental money judgment that awarded statutory attorney fees, an attorney fee sanction, and unpaid fees and costs of the claims administrator.

Defendants appealed, and the court of appeals concluded that the jury’s punitive damage award must be reduced, but otherwise affirmed on the other issues raised on appeal. The court agreed with defendants that the $8 million dollar punitive damage award violated defendants’ rights under the Due Pro-cess Clause of the Fourteenth Amendment to the United States Constitution. The court determined that, because the harm was uniquely economic and because the conduct of defendants was only moderately reprehensible, punitive damages could not exceed a multiple of four times the compensatory damages plus prejudgment interest. Consequently, the court ordered a new trial on punitive damages unless plaintiffs agreed to remittitur of punitive damages to four times their compensatory damages and interest. On review, the issues, as framed by the parties, are as follows:

Issues raised by plaintiff:(1) Where defendants did not assign error to the trial court’s

alternative grounds for rejecting their challenge to the punitive damages award — grounds that allegedly included defendants’ failure to preserve a right to claim that the jury’s award was unconstitutionally excessive — did the Court of Appeals err in addressing the due process question and reversing the trial court?

(2) Did the court of appeals err when it concluded that the jury’s punitive damage award violated due process?Issues raised by the defendants:

(1) Did the trial court err, in a class action suit involving PIP coverage, by excluding evidence of the reasonableness of defendants’ investigation of PIP claims and evidence of the reasonableness of individual charges?

(2) Did the trial court err in denying a directed verdict in de-fendants’ favor on a fraud claim, where the plaintiff in a class action matter provided no evidence of individual class members’ reasonable reliance and no evidence of damages traceable to reliance?

(3) Did the court of appeals err by adopting a 4:1 ratio as a presumptive norm for all punitive damages cases without physical injury, in light of the trend to limit punitive damage awards, as reflected in the Oregon Supreme Court’s decision in Goddard v. Farmers Insurance Co., 344 Or 232, 179 P3d 645 (2008) and the decision of the United States Supreme Court in Exxon Shipping Co. v. Baker, 544 US __, 128 S Ct 2605, 171 L Ed 2d 570 (2008)?

Representing clients in Oregon and Washington

503.227.1515 360.823.0410

GevurtzMenashe.com The firm you want on your side




Pending Petitions for Review—Not Yet Granted or Denied

■ Fred Shearer & Sons, Inc. v. Gemini Ins. Co., 237 Or App 468 (2010) (involving what evidence a court may consider in determining whether a party qualifies as an “insured” under an insurance policy).

■ Strawn v. Farmers Ins. Co. of Oregon, 233 Or App 401 (2010) (involving multiple issues concerning attorney fee awards).

Pending Petitions for Review—Denied

■ Belinsky v. Clooten, 237 Or App 106, 239 P3d 251 (2010), rev den, Oregon Supreme Court No. S058903 (January 14, 2011) (involving ORS 12.220, which permits a new action to be filed within 180 days after entry of a judgment dismissing an action on any ground not adjudicating the merits of the

action).J

Reckless Driving■ Morehouse v. Haynes, 235 Or App 482, rev allowed, 349 Or

370 (2010) (scheduled for oral argument before the Oregon Supreme Court on March 3, 2011).This case involves ORS 31.715. That statute provides that

a plaintiff may not recover noneconomic damages in any ac-tion for injury or death arising out of the operation of a motor vehicle if the plaintiff was in violation of the law prohibiting driving uninsured. But that provision is subject to an exception in ORS 31.715(5)(c), which provides that the prohibition on re-covering noneconomic damages does not apply if the defendant was engaged in conduct that would constitute reckless driving under ORS 811.140.

Plaintiff and defendant were involved in a collision. Because plaintiff was driving uninsured, defendant moved for summary judgment against plaintiff’s claim for noneconomic damages. Plaintiff responded that defendant was driving recklessly at the time of the accident, putting plaintiff within the exception in ORS 31.715(5)(c).

Sitting en banc, the court of appeals held that no reasonable juror could find that defendant’s conduct constituted reckless driving. The issue on review is whether there is evidence from which a finder of fact could find that defendant was driving recklessly at the time of the accident.

Oregon Association of Defense CounselAnnual Convention

June 23–26, 2011Sunriver Resort • Sunriver, Oregon

Mark your calendars to attend the 2011 convention in Sunriver. The conven-tion is going to be a weekend full of exciting activities and education at Sunriver Resort! The convention will feature approximately 6 hours of outstanding CLE credit, a scramble golf tournament, two evening social activities and more. Mark your calendars now and plan to attend!

Convention Registration: Information will be mailed in late March and will also be available on the website, www.oadc.com, at that time.

Lodging: These dates are an exceptionally busy time at Sunriver and we encourage all convention attendees to book their lodging early. You can make reservations with Sunriver Resort at our discounted group rates by contacting them at 800-547-3922 and asking for OADC’s Annual Convention room block. For more information on what Sunriver Resort has to offer, visit their website at

www. sunriver-resort.com. J

OADC Annual ConventionJune 23–26, 2011Sunriver Resort

Sunriver, Oregon


PRACTICE TIPS✔✔

s anyone who tries cases before juries can attest, there is virtually no greater disaster that can befall you than to have your client lie while testifying, and no greater

gift you can receive than to have the opposing party do so – assuming, of

course, you can prove that she or he is lying.

I ’ m g o i n g t o presume that we all absorbed in childhood the moral imperative against lying, through the lectures of our parents and the times

we were sent to bed without supper, and that there is no need for me to make a case for that. I’m further going to presume that all of us are mindful of our ethical duty never to intentionally mislead the court, jury or opposing counsel or knowingly allow our clients or supporting witnesses to do so. Anyone who does not understand, or will not accept, the moral and ethical reasons for conducting oneself honestly at all times, both in and out of court, is in need of greater and more fundamental help than I am capable of providing in this article.

Instead, my intention here is to illustrate how false testimony from the other side can be used strategically to one’s advantage – and why it is critical for us to instruct our clients and witnesses to always, always, always tell the truth.

The bulk of my practice is devoted to

defending personal injury cases. Because

no one else can ever truly know what an

allegedly injured plaintiff is subjectively

experiencing, the key evidence is usually

not the testimony of the respective

sides’ medical experts (although that

is obviously important) but that of the

plaintiff herself or himself. It has been my

consistent experience that juries reward

plaintiffs they believe and punish those

they don’t.

A few years ago, I had a case in which

the plaintiff was an attractive young

woman who claimed that the automobile

accident in which she and my client had

been involved had left her in constant

pain, rendering her unable to work or

go to school. Throughout the trial, she

walked into and out of the courtroom

with the carriage of a 95-year-old wom-

an, holding herself rigid and moving very

slowly, wincing audibly as she lowered

herself into her chair. Her best friend tes-

tified with tears streaming down her face

that ever since the accident, the plaintiff

had been not the happy and bubbly per-

son she had always known but someone

withdrawn and depressed, too overcome

by her physical pain to derive any joy

whatsoever from her life. Needless to say,

all of this was adding up to a sizable ver-

dict against my client – until I presented

my final witness, a private investigator

who had videotaped the plaintiff in the

weeks prior to trial walking and running

briskly and fluidly through stores and a

shopping mall, carrying boxes and bags

with no apparent discomfort. (It also

didn’t hurt that the plaintiff, to empha-

size her virtuous nature, had told the jury

that she had given up cigarettes several

months earlier, whereas the surveillance

tape showed her chain-smoking less than

a week before trial.) After showing the

jury the tape, we took a recess, during

which plaintiff’s counsel eagerly accepted

our small settlement offer (after which I

suppose he cancelled his first-class tickets

to Hawaii). Although I will never know

for sure what the jury would have done

with that case, one of them, a middle-

aged woman, approached me after the

trial and said with a roll of her eyes, “I

can’t move as well as she was in that

video! She’s more flexible than I am!”

In another trial, the plaintiff’s

attorney told the jury during his opening

statement that his client had never

suffered from low back pain prior to the

accident with my client. I was startled

by this, as I had a copy of a worker’s

compensation claim his client had made

for a previous low back injury. I presumed

that my opponent had simply misspoken

in the heat of the moment and that he

would correct his mistake during his

case in chief. Instead, however, when

he put his client on the stand, he asked

if she had ever experienced prior low

back pain and she insisted that she had

not. I believed then, and still do today,

that my opponent had not deliberately

suborned perjury – rather, I think he had

not reviewed his file carefully and did not

know his case. But there was no question

that his client had lied under oath. It was

Practice TipsOh, What A Tangled Web We Weave . . .

Eric MeyerZipse, Elkins & Mitchell

A

Eric Meyer



PRACTICE TIPS

27

✔✔

a simple thing on cross-examination to shove the worker’s compensation claim in her face and ask her to explain it. All she could do in response, of course, was to squirm uncomfortably and mutter that she must have forgotten about that. When the jury left to deliberate, I had not even finished my cup of coffee from the court’s snack bar before they returned less than 15 minutes later with a verdict of zero for both economic and noneconomic damages. And this was in an admitted-liability case, the kind in which one generally assumes there will be a monetary award and defense counsel’s aim is to keep it as low as possible.

When you have clear evidence such as this that the plaintiff has lied to the jury, it is important to ask the court for Uniform Civil Jury Instruction 10.04 (“Witness False In Part”), which provides that “[i]f you find that any person has intentionally given false testimony in some part, you may distrust the rest of that person’s testimony.” When the court has granted my request for this instruction, I will read it out loud to the jury during my closing argument and emphasize that it is appropriate under the law for them to assume that if the plaintiff was willing to lie about one thing, she or he may have been willing to lie about all things to which she or he testified.

Even without UCJI 10.04, dubious testimony can be fatally offensive to a jury. I recently had another admitted-liability auto accident trial in which the plaintiff, for whom English was her second language, testified that she had fully recovered from an earlier accident at the time of the one with my client. Because her medical records established that she had had treatment for ongoing complaints from the prior accident earlier in the very same day as the one

with my client, I asked that 10.04 be given. The judge denied my request, however, in part because he regarded it as a “disfavored instruction” and in part because he believed it was possible the plaintiff’s testimony had been due to her limited comprehension of English. But even without the benefit of UCJI 10.04, the jury returned an award of economic damages but no noneconomic damages.

One of the best phone calls I have ever received came a couple of days before a personal injury trial in Washington County involving a plaintiff

who had hurt himself while engaging in horseplay on my client’s property. During his deposition, the plaintiff had insisted that he had not been under the influence of alcohol at the time he was injured. Two days before trial, an acquaintance whom the plaintiff had not identified as a witness to the subject incident at deposition called me in a rage to inform me that the plaintiff had asked her to perjure herself by telling the jury that he had not been drinking at the time he was hurt. She assured me that she had seen the whole thing, had a clear recollection of the plaintiff being drunk, and was so offended at being asked to lie that, as she told me, “I’m your

witness now.” Needless to say, this young woman immediately became my star witness. And while I have always been superstitious about predicting victory, that was the closest I have ever come to feeling certain that I would receive a defense verdict – which I did.

Incidents of self-immolation by plaintiffs are of course not limited to personal injury trials. I once defended a painting business against a man who claimed that my client had done such shoddy work on his house that he needed not only to have it repainted but to have all of the siding removed and replaced. He ended up tying himself in knots during his testimony by attempting to explain away a statement he had signed approving my client’s work by insisting that he had never been happy with the work but had signed the statement as a friendly gesture in exchange for a private agreement that my client would pay for the siding to be replaced. When I asked him for documentation of this “private agreement,” he conceded that he had none and insisted that the agreement had been oral. I then asked him, “So you’re asking this jury to take your word for it?” He replied indignantly, “YES. I AM.” During closing, I asked the jury if his word could be trusted, given that, by

his own admission, he had lied in signing a statement that he now claimed to have known to be false when he signed it. In the end, the only net monetary award was to my client for its counterclaim against the plaintiff.

I have long subscribed to the observation of attorney Gerry Spence that, quite often, “Lawyers don’t win cases. Their opponents lose them.” When you can show that the opposing party has testified falsely, she or he has virtually handed you a gift-wrapped victory. J

PRACTICE TIPScontinued from page 26

28

COURT NEWS


The 76th Legislative Assembly con-vened on January 10 for a three-day or-ganizational session, then recessed until February 1, when it reconvened to begin its work in earnest.

During the three-day organizational session, 1,600 pre-session filed bills were introduced. We have been working with the OADC Government Affairs Commit-tee and practice group leaders to review and prioritize bills that may have an

impact on OADC members and on the civil practice of law. We are currently tracking 41 bills for OADC and anticipate that this number will grow as more bills are introduced.

Over the course of the last year, we followed the work of the Joint Interim Committee on Justice System Revenues. The committee introduced legislation to simplify the civil and criminal filing fee structures and create a new funding

distribution formula. We will continue to closely monitor the legislation and represent OADC’s interests as this new structure develops.

As part of its commitment to pre-serving access to justice and the judicial system, OADC supports adequate fund-ing for the Judicial Department. We will engage in the Ways and Means process on OADC’s behalf to support a fully func-tioning judicial system. J

Legislative UpdateThe 2011 Legislative Session is Underway

By Inga Deckert and John Isselmann, Jr.

2011 OADC Practice Group Leaders

TRANSPORTATION

Paul Conable, ChairTonkon Torp LLP888 SW 5th Ave., #1600Portland, OR 97204503/802-2188503/972-3888 (fax)[email protected]

Daniel Larsen, Vice ChairAter Wynne LLP1331 NW Lovejoy St., #900Portland, OR 97209503/226-1191503/226-0079 (fax)[email protected]

Heidee Stoller, PublicationsAter Wynne LLP1331 NW Lovejoy St., #900Portland, OR 97209503/226-8616503/226-0079 (fax)[email protected]

Heidi Mandt, Board LiaisonLaw Offices of Kenneth R. ScearceBuilding One4000 Kruse Way Pl., #135Lake Oswego, OR 97035503/534-4401503/534-4409 (fax)[email protected]

COVERAGE EMPLOYMENT NEW LAWYERS

PRODUCT LIABILITY PROFESSIONAL LIABILITY

Scott O’Donnell, ChairKeating Jones Hughes PC1 SW Columbia, #800Portland, OR 97258503/222-9955503/796-0699 (fax)[email protected]

Jonathan Bauer, Vice ChairParks Bauer570 Liberty St. SE #200Salem, OR 97301503/371-3502503/371-0429 (fax)[email protected]

Clark Horner, PublicationsHoffman Hart & Wagner1000 SW Broadway, 20th FloorPortland, OR 97205503/222-4499503/222-2301 (fax)[email protected]

Gordon L. Welborn, Board LiaisonHoffman Hart & Wagner439 SW Umatilla Ave.Redmond, OR 97756541/548-6044541/548-6034 (fax)[email protected]

TRIAL PRACTICE

CONSTRUCTION

Nicholas Baldwin-Sayre, ChairCosgrave Vergeer Kester LLP805 SW Broadway, #800Portland, OR 97205503/323-9000503/323-9019 (fax)[email protected]

Anne Cohen, Vice ChairSmith Freed & Eberhard PC111 SW 5th Ave., #4300Portland, OR 97204503/227-2424503/227-2535 (fax)[email protected]

Brian Church, PublicationsDavis Rothwell Earle & Xóchihua111 SW 5th Ave., #2700Portland, OR 97204503/222.4422503/222.4428 (fax)[email protected]

Dan Schanz, Board LiaisonSpooner & Much PC530 Center St., NE, #722Salem, OR 97301503/378-7777503/588-5899 (fax)[email protected]

COMMERCIAL

Wendy Paris, ChairLaw Offices of Kenneth R. ScearceBuilding One4000 Kruse Way Pl., #135Lake Oswego, OR 97035503/534-4401503/534-4409 (fax)[email protected]

Eric Meyer, Vice ChairZipse Elkins & Mitchell10200 SW Greenburg Rd., #700Portland, OR 97223503/245-3211503/245-3191 (fax)[email protected]

Matthew Ukishima, PublicationsSmith Freed & Eberhard PC111 SW 5th Ave., #4300Portland, OR 97204503/227-2424503/227-2535 (fax)[email protected]

David Auxier, Board LiaisonYturri Rose LLPPO Box SOntario, OR 97914541/889-5368541/889-2432 (fax)[email protected]

Robert Sabido, ChairCosgrave Vergeer Kester LLP805 SW Broadway, #800Portland, OR 97205503/323-9000503/323-9019 (fax)[email protected]

Lloyd Bernstein, Vice ChairGordon & Polscer9755 SW Barnes Rd., #650Portland, OR 97225503/802-9153503/242-1264 (fax)[email protected]

Elizabeth Knight, PublicationsDunn Carney851 SW 6th Ave., #1500Portland, OR 97204503/224-6440503/224-7324 (fax)[email protected]

Jay Beattie, Board LiaisonLindsay Hart1300 SW 5th Ave., #3400Portland, OR 97201503/226.7677503/226-7697 (fax)[email protected]

Amy Joseph Pedersen, ChairStoel Rives LLP900 SW 5th Ave., #2600Portland, OR 97204503/224.3380503/220.2480 (fax)[email protected]

Todd Hanchett, Vice ChairBarran Liebman LLP601 SW 2nd Ave, 23rd Fl.Portland, OR 97204503/228.0500503/274.1212 (fax)[email protected]

Allyson Krueger, PublicationsHitt Hiller Monfils Williams LLP411 SW 2nd Ave., #400Portland, OR 97204503/595.5382503/228.4250 (fax)[email protected]

Jeffrey Eberhard, Board LiaisonSmith Freed & Eberhard PC111 SW 5th Ave., #4300Portland, OR 97204503/227-2424503/227-2535 (fax)[email protected]

Vicki Smith, ChairBodyfelt Mount707 SW Washington St., #1100Portland, OR 97205503/243-1022503/243-2019 (fax)[email protected]

Ryan Boyle, Vice ChairBullivant Houser Bailey PC888 SW 5th Ave., #300Portland, OR 97204-2089503/228-6351503/295-0915 (fax)[email protected]

Jamie Valentine, PublicationsKeating Jones Hughes PC1 SW Columbia, Ste. 800Portland, OR 97258503/222-9955503/796-0699 (fax)[email protected]

David Campbell, Legislative RepWilliams Kastner & Gibbs PLLC888 SW 5th Ave., #600Portland, OR 97204503/228-7967503/222-7261 (fax)[email protected]

Molly Jo Mullen, Board LiaisonBodyfelt Mount707 SW Washington St., #1100Portland, OR 97205503/243-1022503/243-2019 (fax)[email protected]

Mary-Anne Rayburn, ChairMartin Bischoff LLP888 SW 5th Ave., #900Portland, OR 97204503/224-3113503/224-9471 (fax)[email protected]

Joshua DeCristo, Vice ChairSchwabe Williamson1211 SW 5th Ave., #1500-2000Portland, OR 97204503/796-2451503/796-2900 (fax)[email protected]

Jennifer Durham, PublicationsHiefield Foster & Glascock LLP6915 SW Macadam Ave., #300Portland, OR 97219503/501-5430503/501-5626 (fax)[email protected]

Michael “Sam” Sandmire, Board LiaisonAter Wynne LLP1331 NW Lovejoy St., #900Portland, OR 97209-3280503/226-1191503/226-0079 (fax)[email protected]

Jon Stride, ChairTonkon Torp LLP888 SW 5th Ave., #1600Portland, OR 97204503/802-2034503/972-3734 (fax)[email protected]

Eric DeFreest, Vice ChairLuvass Cobb777 High St.Eugene, OR 97401541/484-9292541/343-1206 (fax)[email protected]

Kelly Giampa, PublicationsHoffman Hart & Wagner1000 SW Broadway, 20th FloorPortland, OR 97205503/222-4499503/222-2301 (fax)[email protected]

Michael Lehner, Board LiaisonLehner & Rodriques, PC1500 SW 1st Ave., #1150Portland, OR 97201503/226-2225503/226-2418 (fax)[email protected]

OADC NewsletterEditors 2011

EDITOR IN CHIEFJeanne Loftis Bullivant Houser Bailey PC888 SW 5th Ave., #300 Portland, OR 97204 503/499-4601 [email protected]

ASSOCIATE EDITOR Stephen DeatherageBullivant Houser Bailey PC888 SW 5th Ave., #300Portland, OR 97204503/[email protected]

FEATURE ARTICLES EDITORBruce HamlinMartin Bischoff888 SW 5th Ave., #900Portland, OR 97204503/[email protected]

CASE NOTES EDITORDan LindahlLindahl Law Firm PC 121 SW Morrison St., #1100 Portland, OR 97204 503/241-4099 [email protected]

PRACTICE TIPS EDITOR Eric Meyer Zipse Elkins & Mitchell10200 SW Greenburg Rd.,#700 Portland, OR 97223503/[email protected]

EDITORIAL ASSISTANT Stephanie WilkenBullivant Houser Bailey PC 888 SW 5th Ave., #300 Portland, OR 97204503/499-4490 [email protected]

The Oregon Association of Defense Counsel State Political Action Committee (PAC)The Voice of the Civil Defense LawyerThe Oregon Association of Defense Counsel works to protect the interests of its members before the Oregon legislature, with a focus on:

• Changes in civil practice and the court system

• The judiciary and trial court funding

• Tort reform

• Access to justice

The Oregon Association of Defense Counsel has a compre hensive government affairs pro gram, which includes providing effective legislative advocacy in Salem.

We need your help and support to continue this important work. All donations to the OADC State PAC go to directly support our efforts to protect the inter ests of the Civil Defense Lawyer.

Your contribution to the Oregon Association of Defense Counsel State PAC will support OADC’s efforts in legislative activities and government affairs.

To make a contribution please contact the OADC office to receive a donation form at 503.253.0527 or

800.461.6687 or [email protected]

FIRST CLASSMAIL

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Oregon Association of Defense Counsel Quarterly Magazine Winter 2011

Federal Rule Changes

• OADC 2011 Board of Directors

• Litigation Ethics North and South

of the Columbia

• Intentional Infliction of Emotional

Distress: Does Intentional Include

Reckless?

THE

VERDICT

Documents

VERDICT - OADC · Nicholas Baldwin-Sayre, Chair Cosgrave Vergeer Kester LLP 805 SW Broadway, #800 Portland, OR 97205 503/323-9000 503/323-9019 (fax) [email protected] Anne Cohen, Vice