EN BANC CALENDAR

Before the Minnesota Supreme Court

April 2010

SUMMARY OF ISSUES

Summaries prepared by the Supreme Court Commissioner’s Office

Monday, April 5, 2010, 9:00 a.m.

Supreme Court Courtroom, State Capitol

Katherine M. Rucker, Respondent vs. Steven B. Schmidt, Appellant, Rider Bennett, LLP, Appellant – Case No. A08-1730: Appellant Steven B. Schmidt, then a lawyer with appellant Rider Bennett, LLP, represented Robert Rucker in marital dissolution proceedings from respondent Katherine M. Rucker. About two years after the judgment and decree of dissolution was entered, Katherine Rucker sued Robert Rucker for fraud, alleging that Robert Rucker had misrepresented the value of his business during the dissolution proceedings. After a trial, the district court reopened the property settlement in the marital dissolution action and granted Katherine Rucker judgment against Robert Rucker in the full amount she requested. The Ruckers settled the dispute during the pendency of Robert Rucker’s appeal.

Katherine Rucker then sued appellant Schmidt and the Rider Bennett law firm for fraud, alleging that they had conspired with Robert Rucker and the managers of his business to misrepresent the value of the business. The district court dismissed Katherine Rucker’s lawsuit under the doctrine of res judicata, concluding that Robert Rucker and his counsel were in privity. The court of appeals reversed and remanded the matter for trial. The issue before the supreme court is whether a lawyer and his law firm are in privity with their client where (1) the unlawful conduct alleged by the opposing party arises from the lawyer’s actions on behalf of the client and (2) the party against whom res judicata is asserted had a full and fair opportunity to litigate her claims against the client and received a judgment in the full amount of the damages she sought. (Hennepin County)

State of Minnesota, Respondent vs. Robert Vincent Larson, Appellant – Case No. A05-118: Appellant Robert Larson was convicted after a jury trial of first-degree murder. On appeal from that conviction, Larson presents the following issues: (1) whether the state’s use of Larson’s refusal to submit voluntarily to DNA testing as evidence of Larson’s guilt violated Larson’s right to a fair trial; and (2) whether the district court’s evidentiary rulings deprived Larson of the opportunity to present a reasonable defense. (Ramsey County)

Tuesday, April 6, 2010, 9:00 a.m.

Supreme Court Courtroom, State Capitol

State of Minnesota, Appellant vs. Kasey Vo Cao, Respondent – Case No. A08-1932: Respondent Kasey Vo Cao was charged with felony criminal sexual conduct. During closing argument, the prosecutor argued that Minnesota law does not require that the testimony of a victim of sexual assault be corroborated by other evidence. Counsel for Cao did not object to the prosecutor’s statement. Cao was convicted and appealed his conviction to the court of appeals, arguing in part that the prosecutor’s statement to the jury was prosecutorial misconduct. The court of appeals reversed the conviction on grounds that the prosecutor had committed plain error. Under Minn. Stat. § 609.347, subd. 1 (2008), the testimony of the victim need not be corroborated in a prosecution for criminal sexual conduct. However, in State v. Nelson, the supreme court stated that “there may be cases in which the absence of corroboration might mandate a holding by this court that the evidence was legally insufficient.” 326 N.W.2d 917, 918 (1982). The issue before the supreme court is whether a prosecutor commits misconduct by stating during closing argument that the law does not require the complainant’s testimony to be corroborated. (Anoka County)

Pawn America Minnesota, LLC, Appellant vs. City of St. Louis Park, Minnesota, Respondent – Case No. A08-1697: In June 2007, appellant Pawn America Minnesota, LLC, applied to respondent City of St. Louis Park for a license to operate a pawn shop on Excelsior Boulevard. The city issued a zoning verification letter confirming that Pawn America’s intended use of the property “complies with the zoning code and other applicable city ordinances,” and Pawn America entered into a purchase agreement for the proposed location with a closing date of October 31. After neighbors complained, the St. Louis Park City Council adopted an interim ordinance placing a moratorium on the issuance of new pawnbroker licenses while the council studied the adoption of additional zoning regulations for pawn shops. Under the city charter, a proposed ordinance must receive two readings at least seven days apart and be published in the city’s official newspaper at least 15 days before it becomes effective. The proposed ordinance was read for the first time on October 1 and for the second time at a special meeting of the city council held on October 8. The city also sent the interim ordinance to the weekly official city newspaper, where it was published on October 11. The ordinance went into effect on October 26, 2007.

In February 2008, the city amended its zoning code to limit the location and operation of pawnshops, the effect of which, the district court found, is that a pawnshop cannot now be located on Pawn America’s property on Excelsior Boulevard. Pawn America sued to force the city to issue it a pawnbroker license. The district court granted summary judgment to the city, ruling that the interim ordinance was validly enacted and that the city was not required to issue a license to Pawn America. The court of appeals affirmed. Two issues are before the supreme court on Pawn America’s appeal: (1) whether the court of appeals erred by affirming the validity of the interim ordinance; and (2) whether the court of appeals erred by concluding that the city was not required to issue a pawnbroker license to Pawn America. (Hennepin County)

Wednesday, April 7, 2010, 10 a.m.

University of St. Thomas Law School

State of Minnesota, Respondent vs. Jose Miguel Chavarria-Cruz, Appellant – Case No. A08-1036: As part of a murder investigation, police twice questioned appellant Jose Miguel Chavarria-Cruz. Chavarria-Cruz was eventually indicted for the murder. Before trial, Chavarria-Cruz moved to suppress the two interrogations on grounds that during the first interrogation he had requested a lawyer. During the evidentiary hearing on the motion to suppress, the interrogating officer testified that he did not realize that Chavarria-Cruz had invoked his right to counsel during the first interrogation, because Chavarria-Cruz was so soft-spoken. The motion to suppress was denied and, after a jury trial, Chavarria-Cruz was convicted of second-degree intentional murder. The court of appeals affirmed the conviction. At issue before the supreme court is whether the district court erred in denying Chavarria-Cruz’s motion to suppress. (Hennepin County)

Thursday, April 8, 2010

Supreme Court Courtroom, State Capitol

Riverview Muir Doran, LLC, Respondent vs. JADT Development Group, LLC, et al., Respondents, First Choice Bank, Respondent, Darg, Bolgrean, Menk, Inc., et al., Defendants and First Choice Bank, Respondent vs. JADT Development Company, LLC, et al., Respondent, Riverview Muir Doran, LLC, Respondent, Darg, Bolgrean, Menk, Inc., Defendant, KKE Architects, Inc., Appellant – Case No. A09-312: In 2003, appellant KKE Architects, Inc., was hired to design a condominium project to be known as “River View Homes.” In 2005, respondents First Choice Bank and Darg, Bolgrean, Menk, Inc., agreed to lend funds for construction of the project. At the mortgage closing, the title company issued a check to KKE Architects in return for a receipt and partial waiver of mechanic’s lien rights. However, the check issued to the architects was for less than the value of the work that KKE had done prior to closing. Respondents’ mortgages were recorded in March 2005. In November 2006, the architects served respondent JADT Development Group with a mechanic’s lien statement for nearly $236,000, which was recorded as a lien against the property. Respondent JADT defaulted on the mortgages before construction began and failed to pay the architects. Under Minn. Stat. § 514.05, subd. 1 (2008), mechanic’s liens “attach and take effect from the time the first item of material or labor is furnished upon the premises for the beginning of the improvement, and shall be preferred to any mortgage or other encumbrance not then of record, unless the lienholder had actual notice thereof.” The district court concluded that the architects’ mechanic’s lien had priority over respondents’ mortgages because before the mortgages were recorded respondents had received documents that referred to KKE and the architectural services it had furnished and had actual knowledge of KKE’s prior mechanic’s lien. The court of appeals reversed, concluding that there was nothing in the record to indicate that the lenders were aware of any debt still owed to the architects at the time of closing and that KKE could have indicated on its partial lien waiver that additional amounts were due to it but did not do so. The issue before the supreme court is whether, for purposes of determining priority between a mortgagee and a design professional, the term “actual notice” in Minn. Stat. § 514.05, subd. 1 (2008), refers to notice of the services provided by a design professional or to notice of an unpaid bill for such services. (Hennepin County)

Sarah Erdman, individually and on behalf of others similarly situated, Appellant vs. Life Time Fitness, Inc., Respondent – Case No. A08-1993: While employed by respondent Life Time Fitness, Inc., appellant Sarah Erdman received a base salary and was eligible to receive monthly bonus payments based on year-to-date performance of the business unit she managed. If the total bonus for the year, calculated on the basis of performance of the business unit for the year, was less than the bonus paid to the employee to date, Life Time reserved the right to recover bonus overpayments by reducing the employee’s future paychecks, but not below the amount of the employee’s annual salary. Some of Erdman’s paychecks were reduced in 2005 under this plan. Erdman sued, claiming that she was entitled to overtime under Minn. Stat. § 177.25, subd. 1 (2008), because she was not paid a “salary” as defined by Minn. R. 5200.0211 (2007) (providing that an employee is paid a salary if the employee “is guaranteed a predetermined wage for each workweek”).

After certifying the matter as a class action on behalf of current and former managers of Life Time Fitness who participated in the bonus plan, the district court certified three questions to the court of appeals as important and doubtful: (1) whether the Minnesota Payment of Wages Act, Minn. Stat. §§ 181.01-.171 (2008), and specifically Minn. Stat. § 181.79 (requiring the employee’s written authorization for deductions from wages for recovery of “any other claimed indebtedness running from employee to employer”), applies; (2) if the Payment of Wages Act applies, whether class members are limited to a remedy under Minn. Stat. § 181.79 or whether class members also have a remedy under the Minnesota Fair Labor Standards Act, Minn. Stat. §§ 177.21 - .35 (2008) (requiring payment of overtime for workweeks longer than 48 hours); and (3) if recovery is available under the Minnesota Fair Labor Standards Act, the scope of that remedy.

Before the court of appeals, Life Time agreed that it had violated Minn. Stat. § 181.79 by reducing class members’ wages without authorization but argued that class members were limited to the remedy available under section 181.79, namely, “twice the amount of the deduction or credit taken.” The court of appeals concluded that class members were not “employees” within the meaning of the Minnesota Fair Labor Standards Act and Minn. R. 5200.0211 because they were guaranteed a predetermined amount for each workweek. Because Erdman’s complaint claimed only that Life Time had violated the Fair Labor Standards Act and did not claim a violation of Minn. Stat. § 181.79, the court of appeals did not reach the second and third questions certified by the district court. The issue before the supreme court is whether Minn. R. 5200.0211 requires that the amount of each individual paycheck be guaranteed.

Monday, April 12, 2010, 9:00 a.m.

Courtroom 300, Minnesota Judicial Center

James Kolby-Ralph Lund, Respondent vs. Commissioner of Public Safety, Appellant – Case No. A08-1408: Respondent James Kolby-Ralph Lund was arrested for driving while impaired, and his driver’s license was revoked, after he submitted to a breath-alcohol test administered using an Intoxilyzer. Lund petitioned for judicial review of the revocation of his driver’s license and sought discovery of the computer source code for the Intoxilyzer. The district court denied Lund’s discovery motion and, after a hearing, sustained the revocation of Lund’s driver’s license. The court of appeals reversed and remanded, concluding that Lund had shown that discovery of the computer source code for the Intoxilyzer was relevant to Lund’s ability to challenge the results of his breath-alcohol test, and ordered the State to pay costs and disbursements. On appeal to the supreme court, the issue is whether the State of Minnesota is subject to taxation of costs and disbursements in civil cases in which the State is a party in its sovereign capacity and where no statute specifically authorizes the taxation of costs and disbursements against it. (Mower County)

In re Petition for Disciplinary Action against Robert H. Aitken, III, a Minnesota Attorney, Registration No. 301711 – Case No. A09-1066: A lawyer discipline matter that presents the question of what discipline, if any, is appropriate under the facts of the case.

Tuesday, April 13, 2010, 9:00 a.m.

Courtroom 300, Minnesota Judicial Center

State of Minnesota, Respondent vs. Jamie Leigh Larson, Appellant – Case No. A05-31: Appellant Jamie Leigh Larson was convicted after a jury trial of aiding and abetting first-degree murder. Three issues are before the supreme court on Larson’s appeal: (1) whether she was deprived of a fair trial by the district court’s limits on her counsel’s ability to cross-examine and impeach the prosecution’s witnesses; (2) whether the district court erred in its instructions to the jury; and (3) whether the evidence was sufficient to convict her. (Ramsey County)

Wednesday, April 14, 2010

EN BANC NONORAL: Eden Prairie Mall, LLC, Relator vs. County of Hennepin, Respondent – Case No. A09-2229: Relator Eden Prairie Mall, LLC, protested the valuations of the mall and the Von Maur department store within the mall for property tax purposes for the assessment dates of January 2, 2005, and January 2, 2006. A trial was held before a judge of the Minnesota Tax Court. Several weeks after the conclusion of the trial, relator filed for bankruptcy protection. The tax court issued findings of fact and conclusions of law as to the taxable fair market value of the mall and the department store, from which relator appeals. There are a number of issues before the supreme court: (1) whether the taxable fair market values for the mall as found by the tax court, which were greater than the county’s assessed valuations and greater than the range of values to which either of the parties’ respective experts testified, lacked evidentiary support in the record; (2) whether the tax court erred as a matter of law in finding that relator mall submitted sufficient evidence to rebut the presumptive validity of the county’s assessed values; (3) whether the tax court’s judgment increasing the mall’s property taxes for the years in question violated federal bankruptcy laws, specifically, 11 U.S.C. § 362(a)(1) (2000), which imposes an automatic stay on “the commencement or continuation . . . of a judicial, administrative, or other action or proceeding against the debtor”; (4) whether the tax court erred by failing to properly apply generally accepted appraisal methodology; and (5) whether the capitalization rate used by the tax court was supported by the evidence. (Tax Court)

EN BANC NONORAL: Brett Arnold Laine, petitioner, Appellant vs. State of Minnesota, Respondent – Case No. A09-323: Appellant Brett Laine was convicted after a jury trial of first-degree murder; his conviction and the denial of his first petition for postconviction relief were affirmed on appeal. State v. Laine, 715 N.W.2d 425 (Minn. 2006). Laine’s first petition for postconviction relief alleged that he had received ineffective assistance of counsel at trial. In 2008, Laine filed a second petition for postconviction relief, alleging among other things newly discovered evidence and ineffective assistance of counsel. The district court denied Laine’s second petition for postconviction relief without an evidentiary hearing. On appeal to the supreme court, the issue is whether the district court erred by denying Laine’s second petition for postconviction relief without an evidentiary hearing. (St. Louis County)