EN BANC CALENDAR
Before the Minnesota Supreme Court
SUMMARY OF ISSUES
Summaries prepared by the Supreme Court Commissioner’s Office
Monday April 2, 2018
Supreme Court Courtroom, State Capitol Building, Second Floor
Walgreens Specialty Pharmacy, LLC, Respondent vs. Commissioner of Revenue, Relator – Case No. A17-1991: Minnesota imposes a use tax on “legend” or certain specialty drugs, Minn. Stat. § 295.52, subd. 4(a) (2016). The taxpayer, Walgreens Specialty Pharmacy, filled orders for sales of legend drugs to Minnesota customers from inventory maintained outside of Minnesota. The Commissioner assessed Walgreens with the use tax, and later denied a refund of the tax paid. The Tax Court concluded that the plain language of the statute excluded Walgreens’ delivery of drugs from its inventory maintained outside of Minnesota, and did not consider Walgreens’ constitutional challenges to the statute.
On appeal to the supreme court, the issues are (1) whether Minnesota’s legend drug tax applies to Walgreens’ delivery of legend drugs into Minnesota for use by Minnesota customers, and (2) whether the use tax imposed by Minn. Stat. § 295.52, subd. 4(a), violates the Commerce Clause or Due Process Clause of the U.S. Constitution. (Minnesota Tax Court)
Nonoral: Roberto U. Varela Leal, Respondent vs. Knife River Corporation and Liberty Mutual Insurance Companies, Relators and Integrated Care Clinics, P.A., et al., Intervenors – Case No. A17-0527: The employee was awarded temporary total and temporary partial disability benefits for a work-related injury, with the temporary total disability benefits beginning after a seasonal layoff started. The Workers’ Compensation Court of Appeals (WCCA) rejected the employer’s argument that the employee’s wage loss was due to the seasonal layoff rather than the work injury and also concluded that the employer did not rebut the presumption that the employee’s actual earnings accurately reflected a reduced earning capacity.
On appeal to the supreme court, the issues are (1) whether the WCCA erred in concluding that a seasonal layoff constitutes a wage loss attributable to a work injury, and (2) whether the employee sustained an actual loss of earnings to support an award of temporary partial disability benefits. (WCCA)
Tuesday April 3, 2018
Supreme Court Courtroom, State Capitol Building, Second Floor
In the Matter of the Welfare of the Children of: S.R.K. and O.A.K., Parents – Case No. A17-1194: The district court granted the county’s petition to terminate parental rights, finding that the evidence was sufficient to support a finding that “continued custody of the children by the parent or Indian custodian is likely to result in serious emotional or physical damage” to the children. 25 U.S.C. § 1912(f) (2012). Father argued on appeal that the district court’s finding lacked adequate support in the record. The court of appeals concluded that the absence of a specific finding required a remand. On remand, the district court amended its earlier findings, concluding that the county presented proof beyond a reasonable doubt that returning the children to their parents is likely to result in serious emotional or physical damage to the children. The parents appealed again, asserting that the record does not support the district court’s finding. The court of appeals affirmed.
On appeal to the supreme court, the issue is whether the evidence at trial supported the district court’s finding that returning the children to their parents would likely result in serious emotional or physical harm. (Clay County)
Nonoral: Ronald R. Johnson and Dee L. Johnson, Relators vs. County of Hennepin, Respondent – Case No. A17-2032: Relators Ronald and Dee Johnson challenged the property tax assessment for property they own in Shoreview, Minnesota. The tax court concluded that it lacked jurisdiction to address the petition once it was automatically dismissed for failure to pay the required property tax payments. The tax court then denied the Johnsons’ petition for rehearing.
On appeal to the supreme court, the issue presented is whether the tax court erred by denying the relators’ petition for rehearing. (Minnesota Tax Court)
Wednesday April 4, 2018
University of Minnesota Law School – 8:30 A.M.
Phone Recovery Services, LLC, for itself and on behalf of the State of Minnesota, Appellant vs. Qwest Corporation, a Colorado company, et al., Respondents – Case No. A17-0078: Minnesota law requires telecommunications providers to collect from their customers and remit to the state certain charges that fund the 911 telecommunications infrastructure, the Telecommunications Access Minnesota (TAM) program, and the Telephone Assistance Plan (TAP). See Minn. Stat. § 403.11(d) (2016) (911 program); Minn. Stat. § 237.52 (2016) (TAM); Minn. Stat. § 237.20 (2016) (TAP). Appellant Phone Recovery Services (PRS), acting under Minnesota’s False Claims Act, Minn. Stat. §§ 15C.01-.16 (2016), alleges that respondents, who are telecommunications providers, failed to collect these charges at the proper rates from some of their customers and failed to remit the proper amounts to the state. The state declined to intervene in the action. Respondents moved to dismiss PRS’s complaint, arguing among other things that the charges at issue are actually taxes under Minnesota law and thus subject to the “tax bar” in Minn. Stat. § 15C.03, which provides that the False Claims Act “does not apply to claims, records, or statements made under portions of Minnesota Statutes relating to taxation.” The district court granted respondents’ motion on that basis. The court of appeals affirmed.
On appeal to the supreme court, the issue presented is whether the 911, TAM, and TAP fees fall under the tax bar of Minn. Stat. § 15C.03. (Ramsey County)
Monday April 9, 2018
Courtroom 300, Minnesota Judicial Center
Mary Laymon as the personal representative of the Estate of Howard Arnold Laymon, Appellant vs. Minnesota Premier Properties, LLC, et al., Respondents – Case No. A17-0162: Howard Laymon died owning real property that was subject to a mortgage. He was survived by three adult children, including John Laymon and appellant Mary Laymon. His will left his tangible personal property to his children, made no other specific devises, and gave “the residue” of his estate “in equal shares to my children, if any that survive me.” After Howard’s death, the mortgage went into default, and the lender commenced foreclosure proceedings. John and his wife executed a quitclaim deed conveying any interest they had in the real property to respondent Minnesota Premier Properties LLC (“Premier”). A series of transactions followed, all based on the interest that John and his wife conveyed or attempted to convey to Premier; these transactions involved respondents Aquarium Capital Investments LLC, Blue Golds Ventures LLC, and 4Path Realty (the assumed name of Stonewood Realty LLC). Blue Golds Ventures eventually redeemed the real property from the lender’s mortgage servicing agent. Meanwhile Mary was appointed personal representative of Howard’s estate. She sued respondents in district court, asserting quiet-title and slander-of-title claims regarding the real property.
The district court granted partial summary judgment in favor of Mary on her quiet-title claim, reasoning that John’s deed to Premier did not convey any valid interest in the real property, because although under Minn. Stat. § 524.3-101 (2016), the rights to property that is specifically devised devolve to the devisee upon the testator’s death, the district court interpreted the statute not to provide the same result for property that is part of the residual estate. Therefore John had no interest in the real property to convey at the time he and his wife executed the quitclaim deed, and all those who took title in the chain of transactions after him also had no valid interest in the real property. The court of appeals reversed, reasoning that the statute applies not just to recipients of specific devises, but also to those named in a residuary clause.
On appeal to the supreme court, the issue presented is whether, under Minn. Stat. § 524.3-101, a valid, transferable ownership interest in real property devolves immediately upon a testator’s death to a person to whom the property is devised by the testator’s will, even if the property is devised through a residuary clause rather than a specific devise. (Hennepin County)
Nonoral: John R. Gerardy, Relator vs. Anagram International and Liberty Mutual Insurance Company, Respondents and John Stark, M.D., et al., Intervenors – Case No. A17-1507: The employee suffered a work-related injury in May 2010, which the compensation judge found was temporary in nature and fully resolved by July 2010. The employee’s claims for temporary total disability and permanent partial and total disability benefits were denied. The employee appealed to the Workers’ Compensation Court of Appeals (WCCA), which concluded that substantial evidence supported the compensation judge’s findings.
On appeal to the supreme court, the issue is whether the WCCA erred in affirming the decision of the compensation judge. (WCCA)
Tuesday April 10, 2018
Courtroom 300, Minnesota Judicial Center
Janet Hufnagel, Respondent vs. Deer River Health Care Center and MHA Insurance Co., Respondents and Essentia Health – Deer River and Berkley Risk Administrators Co., Relators and Midwest Spine and Brain Institute, et al., Intervenors – Case No. A17-2064: The employee sought and was awarded benefits for a work-related injury. Thereafter, the employee’s attorney sought an award of attorney’s fees and costs, including excess Roraff/Irwin fees and fees under Minn. Stat. § 176.191, subd. 1 (2016). Following a hearing, the compensation judge awarded the attorney excess Roraff/Irwin fees, but denied the request for an award of fees under Minn. Stat. § 176.191. The Workers’ Compensation Court of Appeals (WCCA) vacated the fee award and remanded to the compensation judge for further consideration of the adequacy of the fee award under Minn. Stat. § 176.191.
On appeal to the supreme court, the issues are (1) whether the WCCA properly applied the standard of review to the compensation judge’s award of attorney fees, and (2) whether the WCCA erred in concluding that Roraff/Irwin fees and fees under Minn. Stat. § 176.191 can be awarded as excess compensation. (WCCA)
Wednesday April 11, 2018
Anoka High School – 9:00 A.M.
State of Minnesota, Appellant vs. Courtney John Edstrom, Respondent – Case No. A16-1382: The police received a tip from a confidential informant that respondent Cortney Edstrom was selling methamphetamine out of a third-floor apartment in Brooklyn Park. The police learned that S.G., a person Edstrom had previously listed as an emergency contact on a government form, lived on the third floor of the apartment building. The apartment building is secured, but property management maintains a lockbox, called a Knox box, with a building key inside that enables law enforcement to access the building. Police officers, along with a narcotics-detection dog, entered the apartment building by using the key from the Knox box. The dog provided a positive alert for the presence of narcotics at the door to S.G.’s apartment. Based on this information, the police applied for and received a warrant to search S.G.’s apartment. When the police executed the warrant, Edstrom was there. The police found, among other things, methamphetamine and multiple firearms. The State charged Edstrom with first-degree sale and possession of a controlled substance and possession of a firearm by an ineligible person. Edstrom filed a motion to suppress the methamphetamine and firearms, which the district court denied. A jury found Edstrom guilty of first-degree possession of a controlled substance and possession of a firearm by an ineligible person. The court of appeals affirmed.
On appeal to the supreme court, the following issues are presented: (1) whether the warrantless dog sniff violated Edstrom’s Fourth Amendment rights because the area in the hallway outside S.G.’s apartment door is curtilage of the apartment, and (2) whether the warrantless dog sniff violated Edstrom’s Fourth Amendment rights because Edstrom had a reasonable expectation of privacy in the area of the hallway outside S.G.’s apartment door. (Hennepin County)