Utah Federal Court Explains The Nature Of Facebook

Leave it to the courts to explain to us the nature of social media. Let’s take a look at the very, very recent Larada Scis., Inc. v. Skinner, No. 2:15-CV-0399-JNP, 2015 WL 7768836 (D. Utah Dec. 2, 2015), a patent case. The court was called upon to undertake a personal jurisdiction analysis and analyze the website of one of the defendants. The question was whether the Picky Pam website evidence purposeful availment of the forum, and the court analyze the purported interactive nature of the website at issue in its analysis. It’s an interesting – and brand new – opinion on this issue, but we just wanted to point to the paragraph in which the court explains to the reader the nature of Facebook:

 . . . [M]aintaining an interactive website is no longer the sole purview of corporations. In fact, with the invention of social media, many individuals, to say nothing of organizations, maintain an interactive website. In a matter of minutes, an individual can create a Facebook account and upload content to his or her own “Facebook page.” That page may allow all other Facebook users to interact with it. The level of interactivity on even the most basic Facebook page arguably exceeds that of even the most interactive website in 1997 . . . . It is difficult to envision a website that is more interactive than the average Facebook page. Indeed, a principal purpose of social media is to facilitate interactions between users.

See id. at *4 (footnotes omitted).

It’s always fun when federal courts attempt to explain the phenomena of social media. Of course, some explanation is required in a jurisdictional opinion (and the court was analyzing a framework established by a 1997 Pennsylvania opinion). But, in this day in age, we all know of Facebook, and by its very nature, it is interactive, as the court does note.

Oh, well.

The Rolling Stones Are Losing Their Insurance Battle

There really is no other way to begin this blog post than with the expected and obvious: the Rolling Stones have recently learned that “You Can’t Always Get What You Want.”  Or perhaps noting that they “(Can’t Get No) Satisfaction” would be apropos, as well.  But we digress. . . .  According to various media outlets, including the Chicago Sun Times, the iconic band’s recent insurance claim—a $12.7 million claim—was denied by insurance underwriters.  The Stones submitted the claim for reimbursement for concerts they were forced to cancel in Australia and New Zealand after lead singer’s Mick Jagger’s girlfriend L’Wren Scott committed suicide in March of this year.

Last month, the underwriters petitioned the federal court in Utah, Scott’s native state, to permit them to gather testimony and documents from Scott’s brother.  A federal judge granted the request a week later.  After the underwriters’ denied the claim, the Stones filed suit in the friendly confines of London.   Here is the crux of the issue: The $23.9 million insurance policy issued to the band purported to provide coverage for the possibility of concerts being canceled due to the death of the band’s family members.  Jagger and Scott’s lack of a legal union was not the reason for the insurance underwriters’ denial—indeed, Scott was apparently covered under the policy as Jagger’s longtime girlfriend.  Rather, the insurance underwriters denied coverage based on their contention that Scott suffered from a pre-existing medical and/or mental condition that voided coverage for her death under the policy.  The insurance company is also questioning Jagger’s claim that because of his depression following her death, he was advised by doctors not to perform for at least a month thereafter.

We here at Abnormal Use are somewhat surprised that it was the pre-existing condition issue which was the underwriters’ basis for denial and are curious as to whether the policy failed to include a suicide exclusion or intentional act exclusion.  In any event, it seems clear the band will not give up its fight easily—in fact, we can envision the Stones’ singing “Start Me Up” upon receiving news of the underwriters’ decision and subsequent lawsuit.  We will certainly follow up on the claim, the policy language and the underwriters’ legal reasoning as the case progresses.  In the meantime, we invite our readers to “Shine A Light” on the underwriters’ denial and insight or predictions regarding the case as it moves forward.

McDonald’s Hot Coffee Case: Improper Subject of Closing Argument

For better or worse, the infamous Stella Liebeck McDonald’s hot coffee case filtered through our legal system and staked its claim in the mainstream media. Despite the fanfare surrounding that case, few know all the in’s and out’s of the case from either the plaintiff’s or the defendant’s perspective. Perhaps playing on the ignorance of the general populace, supporters of both tort reform and social justice movements have used the case as propaganda to support their causes. We suppose there is no harm done in using the case as a means of persuading the public. But what would happen if the case was used to sway a jury? Looking deep into the legal vault, the Utah Supreme Court gives us its answer to the question.

In Boyle v. Christensen, 251 P.3d 810 (Utah 2011), the plaintiff was injured when struck by a truck while walking in a crosswalk.  After the defendant truck driver admitted liability, the case proceeded to trial on the issue of damages.  During closing arguments, counsel for the defendant responded to the plaintiff’s request for damages as a result of pain and suffering with the following:

Ladies and gentlemen, they want a lot of money for this. A lot of money. What’s been written on the board is called a per diem analysis…. How many days has it been since the accident? How many days for the rest of his life. And how much per day is that worth? That’s what’s been done here. That’s how we get verdicts like in the McDonald’s case with a cup of coffee.

Whoa!  Did that come out of nowhere?  Plaintiff’s counsel sure thought so, immediately objecting to the reference as prejudicial and not in evidence.  The objection was overruled, and the jury returned a verdict of $62,500, about one-seventh of that sought by the plaintiff.  Not satisfied with the result and the reference to the infamous hot coffee case, the plaintiff appealed.

After the Court of Appeals affirmed the judgment, the Utah Supreme Court reversed and remanded the case to the trial court.  In finding that the reference to the McDonald’s hot coffee case was improper, the Court discussed at-length the general public ignorance of the facts of the McDonald’s case and recited the standard pro-Liebeck talking points (i.e. coffee measured 180-190 degrees, McDonald’s received 700 previous complaints, etc.).  Given this perceived ignorance, the Court stated:

Given the uniquely iconic nature of this case, the passion it has produced in the media, and the general misunderstanding of the totality of its facts and reasoning among the public, we find it hard to imagine a scenario where it would be proper for a party’s counsel to refer to it before a jury. Generally, as here, such a reference would seem to have the sole purpose of recalling the public outrage over isolated elements of the case—thus improperly appealing to a jury’s passions. It is not the jury’s job to make legal determinations, so no legal arguments from the case are relevant. The facts in the McDonald’s coffee case were not in evidence before this jury and were also utterly irrelevant. Indeed, the one attempt counsel made to make her reference seem relevant was a misrepresentation because the high punitive damages award in the McDonald’s coffee case had nothing to do with a per diem analysis. It is certainly unfair to require the other party to clarify all the misconceptions about this irrelevant case in the limited time allotted for closing argument. The great latitude provided in closing arguments regards reasonable inferences about evidence properly before the jury and does not extend to misrepresentations or efforts to appeal to a jury’s passions. Thus the reference to the McDonald’s coffee case in closing argument was improper.

While we may disagree with some of the Court’s talking points, we have to agree that the reference to the McDonald’s case was improper in this context.  The jury should be deciding the case based on the facts at hand and not based on whatever misconceptions they may have about another case tried in another jurisdiction years before.  Interestingly, it appears that defense counsel may have been equally ignorant of the facts of the McDonald’s case as those sitting in the jury box.  As the Court correctly noted, the high punitive damages awarded in the McDonald’s case were based on two days of coffee sales and not the per diem analysis used to calculate pain and suffering to which he was arguing.

There is nothing wrong with continuing to discuss the McDonald’s case.  We do it a lot here at Abnormal Use.  However, we should keep it in its proper context and out of the courtroom.

And, for good measure, let’s try to know the facts before bringing the case up in public.

(Hat Tip: Eric Nordstrom).

Park City Ski Resort Battle Rages On

Last year, we here at Abnormal Use reported on the legal battle between ski resort operators in Park City, Utah.  It all started when Park City Mountain Resort (PCMR) inadvertently failed to renew a 50 year lease for the land upon which its resort is located.  Unfortunately for PMCR, that land is owned by Talisker, a competitor who has since leased the land to Vail Resorts.  Tailsker and Vail recently scored what could prove to be a knockout blow against PMCR.

In May, a Utah court ruled that PMCR officials had indeed failed to renew their sweetheart lease for a majority of their ski terrain.  Apparently, the court was not too impressed with PMCR’s “honest mistake” defense as a justification for being a few days late in renewing the fateful lease agreement.  As result of PMCR’s failure to properly renew, the court held that Talisker had the right to lease the upper mountain to a new operator – which is exactly what it did in refusing to lease the land to PMCR and instead leasing it to Vail.  Of course, PMCR has publicly stated that it will appeal the ruling. We’ll see what happens there.

Regardless of the ultimate results of the proceeding, the real losers may be the residents of Park City and the multitudes of skiers who enjoy the mountain each year.  Even if Talisker and Vail prevail, it won’t be enough to ensure the mountain stays open.  Although Talisker owns the majority of the land at issue, PMCR actually owns the property at the base of the mountain, and without that land, it will be virtually impossible for Vail to run a resort there.  The CEO of PMCR’s parent company has repeatedly stated that the land at the base of the mountain is not for sale.

Trouble In (Ski) Paradise: Lease Dispute in Park City

Yours truly just returned from a nice, albeit short, ski vacation in Park City, Utah.  Of course, I couldn’t make it through the whole trip without coming across some blog material.  Anyone who has ever been skiing out west knows that it’s big business (both literally and figuratively). The ski resorts invest millions upon millions of dollars in chair lifts, grooming equipment, dinning facilities, et cetera, all in an effort to attract thousands of skiers at daily prices of around $100 per person.  As such, it was a little surprising to learn that Park City Mountain Resort (PCMR), one of most popular ski resorts in the United States, doesn’t even own the land that its uber expensive equipment sits upon.  It was even more surprising to discover who actually owns the land.  The land is owned by Talisker Land Holdings (Talisker).  Talisker is the company that runs The Canyons, which is PCMR’s next door neighbor and one of its biggest competitors.  So, it was not surprising to then find out that they two were in a battle royal lease dispute.

This fight has been ongoing for some time.  PCMR’s 40 year lease of the 3,000 plus acres of land that its resort sits upon expired in 2011.  PCMR had pretty sweet lease deal which gave them rights to the surface land for just $155,000 per year.  How sweet of a deal was it?  Well, ironically, Talisker actually leases the land that The Canyons sits upon and it pays approximately $3 million per year for that lease.  Even with the lease set to expire, PMCR still had an option to extend the lease for another 40 years.  All it had to do was confirm the extension in writing by April 30, 2011, but PCMR allegedly failed to give timely notice.  Whoops!  In December of 2011, Talisker informed PCMR that the lease agreement had expired and claimed that it had the right to refuse to extend the lease until PCMR agreed to its terms.

In March of 2012, PCMR filed a lawsuit alleging that although PMCR did not enter into a formal lease extension, the parties actions demonstrated that PCMR exercised its right to extend the leases through 2051. Namely, that Talisker allowed PMCR to undertake $7 million in equipment upgrades on the land in the summer of 2011 without raising any objections.  PMCR also argued that even if it failed to properly extend the lease, Talisker failed to disclose its intentions and was not negotiating a lease extension in good faith.

The battle continues.  For a while, it wasn’t even clear whether PCMR would open for the 2012-2013 ski season, but a deal was reached to allow PCMR to continue operations while a resolution is sought.  Regardless of the outcome of this legal battle, let’s just say Park City Mountain Resort finds itself in an unenviable position.  It’s one thing to lease the land that is a vital part of your business.  It’s a whole different animal to lease that land from your biggest competitor.  It would be like Universal Studios from Disney.

Utah Court of Appeals Affirms Summary Judgment in Case of Postal Worker vs. Mailbox Manufacturer

In Niemela v. Imperial Manufacturing, Inc., — P.3d —, No. 20100682, 2011 WL 4485978 (Utah Ct. App. Sept. 29, 2011), the Utah Court of Appeals reconsidered a trial court’s grant of summary judgment against a postal worker who sued the manufacturer of mailboxes.  Patricia Niemela delivered mail for the United States Postal Service in a neighborhood in which mailboxes installed by Imperial Manufacturing had been installed.  According to Niemela, the mailboxes were defectively designed and manufactured, allowing them to take on water and freeze when the temperature dropped.  She was forced to use tools to break up the ice, which allegedly caused her to sustain hand injuries.  As noted by the court, Niemela brought claims for strict liability, negligence, and breach of implied warranty against the manufacturer:

In her products liability claim, Niemela alleges that the Imperial mailboxes contained design and manufacturing defects rendering them unreasonably dangerous. She seeks to demonstrate these defects by showing that the mailboxes did not conform to the 2001 USPS regulations, notwithstanding the fact that the mailboxes were designed and manufactured in 1995. Imperial responds that (1) the mailboxes must be presumed nondefective because they complied with federal regulations in effect when they were designed and manufactured, and (2) Niemela has not presented sufficient evidence to overcome this presumption.

The Court of Appeals affirmed the entry of summary judgment against Niemela and reiterated the trial court’s reasoning.  At the time the mailboxes were manufactured, they complied with the USPS regulations.   Citing a statutory presumption from the Utah Code, the appellate court observed:

There is a rebuttable presumption that a product is free from any defect or defective condition where the alleged defect in the plans or designs for the product or the methods and techniques of manufacturing, inspecting and testing the product were in conformity with government standards established for that industry which were in existence at the time the plans or designs for the product or the methods and techniques of manufacturing, inspecting and testing the product were adopted.

In order to overcome the presumption, the plaintiff must prove by a preponderance of the evidence that the product is unreasonably dangerous.  Niemela could not do so, because her bald accusations about certain aspects of the mailbox were not supported.  In the end, all she had was an allegation that she was injured, and therefore there must have been something wrong with the mailboxes.  It was not enough.

Products Liability Case Dismissed for No Injury

It’s been a tough year for Toyota. The automaker has built a strong reputation based on quality craftsmanship, but plaintiffs’ lawyers keep piling on, filing suits like the one described here, accusing Toyota of ignoring acceleration problems for years. So far, however, the allegations regard economic loss: “The revised lawsuit was filed in U.S. District Court in Southern California on behalf of nearly 40 consumers and businesses for claims of economic losses, including diminished vehicle values, stemming from complaints of Toyota cars racing out of control.”

Plaintiffs may be better off in California, because the District of Utah granted Toyota’s Motion to Dismiss in a similar case, Winzler v. Toyota Motor Sales USA, Inc., No. 1:10-CV-00003, 2010 WL 3064364 (D. Utah Aug. 3, 2010). In Utah at least, a plaintiff must suffer some kind of injury before recovering money from a defendant. Winzler brought an action based on her 2006 Toyota Corolla. Incredibly, “Ms. Winzler does not claim that she has suffered any problems with the engine in her car.” She alleged that she has been injured because she did operate the car, and such operation exposed her to increased risk of personal injury. Or, I could have been injured, thankfully I was not, please pay me some money anyway. One of the quotes attributed to Winston Churchill is “The greatest thrill a man can experience is to be shot at and missed.” For some reason, plaintiffs do not agree and instead ruminate on the misfortune of not having been injured. It’s a shame really. All of these uninjured people walking around thinking about what they’re life had been like had they been injured.

You might guess that the District of Utah dispensed with the case quickly. To the court’s credit, it reasons through the law, rather then simply saying something like, “Every first year law student knows that you need an injury to recover.” Instead the court reasons why the cases cited by the plaintiff in support for her argument, alleging constitutional violations, have a different analytical framework than your average products liability action. Neither may Winzler recover for her supposed economic damages. In short, the Court noted that a plaintiff must suffer an injury to recover under a products liability, negligence, or breach of warranty theory. Because Winzler did not allege that her car has shown any defect, her suit was dismissed.

Coming back to the California case, it should be interesting to see what the different sovereigns allow in the forms of product liability claims. I imagine the plaintiffs’ lawyers have this figured out, and a great deal of forum shopping has already or will take place. Hopefully Toyota can dispatch with these types of cases quickly and move to the cases where there may actually have been an injury.