EN BANC CALENDAR
Before the Minnesota Supreme Court
SUMMARY OF ISSUES
Summaries prepared by the Supreme Court Commissioner’s Office
Monday, March 1, 2021
Minnesota Judicial Center
Glacier Park Iron Ore Properties, LLC, Appellant vs. United States Steel Corporation, Respondent – Case No. A19-1923: In 2010, respondent United States Steel Corporation and the Great Northern Iron Ore Properties Trust entered into a consolidated lease that authorized U.S. Steel to mine on land owned by the Trust until 2057. The trust terminated and some of its assets, including mineral leases, were transferred to appellant Glacier Park Iron Ore Properties, LLC.
In 2019, Glacier Park served an arbitration demand on U.S. Steel, claiming the trustees of the trust had breached fiduciary duties when negotiating the lease and that U.S. Steel aided and abetted that breach. The arbitration clause in the lease provides for arbitration of “any disagreement or controversy . . . between Lessor and Lessee as to whether any of Lessee’s mining practices conform to the standards stipulated herein, or as to any fact that might affect the determination of royalty payable hereunder, or as to any fact relative to the observance or fulfillment of the terms and obligations hereof by either party, or as to any other matter herein specifically stated.” Later Glacier Park sued U.S. Steel and sought an order from the district court referring the parties to mandatory arbitration.
The district court denied the motion. It concluded that the question of arbitrability was one for it (rather than an arbitrator) to decide; and it determined that Glacier Park’s claim was not covered by the arbitration provision. The court of appeals affirmed in a published decision, reasoning that under Minn. Stat. § 572B.06(a) (2020)—a provision of the revised Minnesota Uniform Arbitration Act that became effective in 2011—the district court is to determine arbitrability and previous decisions to the contrary had been displaced by adoption of the revised MUAA. And it agreed with the district court that Glacier Park’s claim was not arbitrable under the arbitration clause in the lease.
On appeal to the supreme court, the issues presented are: (1) what legal standard applies under the revised Minnesota Uniform Arbitration Act as to whether the question of arbitrability goes to a court or arbitrator; and (2) whether Glacier Park’s claim, which calls into question the validity of the lease, is arbitrable under the terms of the lease. (St. Louis County)
Walmart Inc., Appellant vs. Winona County, Respondent, Martin County, Respondent – Case Nos. A19-1877, A19-1878: In these consolidated appeals, appellant Walmart Inc. challenges two district court decisions, which dismissed Walmart’s complaints against respondents Winona County and Martin County for failure to state a claim under Minn. R. Civ. P. 12.02(e). Walmart describes its complaints as alleging that the Counties “intentionally, arbitrarily, and systematically singled Walmart out for disparate treatment to extract excessive property taxes and, in doing so, violated the Equal Protection Clause of the United States Constitution and Uniformity Clause of the Minnesota Constitution.” Both district courts ruled that chapter 278, Minn. Stat. §§ 278.01–.14 (2020), provides the exclusive remedy for unequal assessment claims. The court of appeals affirmed, concluding, “Walmart’s complaints fail to state a claim for constitutional violations.”
On appeal to the supreme court, the primary issue presented is whether chapter 278 provides the exclusive means for property tax challenges, including constitutional claims alleging intentional discrimination in taxation. (Winona County and Martin County)
Tuesday, March 2, 2021
Minnesota Judicial Center
Jessica Hagen, on behalf of herself and others similarly situated, Appellant vs. Steven Scott Management, Inc., Respondent – Case No. A19-1224: Appellant Jessica Hagen worked part-time as a property caretaker for respondent Steven Scott Management, Inc. (“Scott”), at an apartment complex where she lived. Hagen’s lease provided for a monthly rent of $1,370. Pursuant to the parties’ written agreement regarding her employment, Scott compensated Hagen primarily with rent credits at a rate equivalent to $8.50 per hour worked, to a maximum value of $845 per month for 99.75 hours worked per month. If Hagen worked more than 99.75 hours per month, she was issued a check for the excess hours at the $8.50 per hour rate. On multiple occasions during her employment, Hagen did in fact work more than 99.75 hours per month and was issued a check as the agreement specified.
Hagen was required to be the “on-call” caretaker at least once per week, every fifth weekend, and two holidays each year. Scott’s policy, which it followed with respect to Hagen, was to pay employees who are on call only for hours they actually work while on call. During the on-call shifts, Hagen was required to carry a cell phone (provided by Scott) and to be within a 20-minute radius of the property in order to respond to tenants’ requests for assistance. The on-call limitations restricted Hagen’s ability to engage in daily activities unrelated to work, including visiting family members who lived more than 20 minutes from the property, and consuming alcohol.
Hagen sued Scott, challenging Scott’s payment of wages in rent credits rather than cash, as well as its failure to pay her for on-call time. She raised claims of (1) failure to pay minimum wage in violation of the Minnesota Fair Labor Standards Act (MFLSA), Minn. Stat. §§ 177.21–.35 (2020); (2) improper deductions from wages, in violation of Minn. Stat. § 181.79 (2020); and (3) failure to pay for all time worked, including time spent on call and time spent on site waiting to work, in violation of Minnesota’s Payment of Wages Act (PWA), Minn. Stat. §§ 181.01–.1721 (2020), and the MFLSA.
The district court granted summary judgment in favor of Scott, reasoning that rent credits are a permissible method of paying wages under the MFLSA; that under Johnson v. Sitzman, 413 N.W.2d 541 (Minn. App. 1987), Hagen’s agreement with Scott to be compensated with rent credits means that those credits are not an unlawful deduction from wages under Minn. Stat. § 181.79; and that under Minn. Stat. § 177.23, subd. 10 and Minn. R. 500.0120, subp. 1, Hagen was not entitled to payment for on-call time during which she was not actually responding to calls. The court of appeals affirmed in a published decision.
On appeal to the supreme court, the issues presented are: (1) whether payment by means of rent credits is permitted under the MFLSA; (2) whether payment by means of rent credits constitutes an unlawful deduction from wages under Minn. Stat. § 181.79; (3) whether Hagen was entitled to pay for on-call time under Minn. Stat. § 177.23, subd. 10, and Minn. R. 5200.0120, subp. 2; and (4) whether disputed issues of material fact precluded summary judgment in Scott’s favor. (Hennepin County)
In re Petition for Disciplinary Action against Michelle Lowney MacDonald, a Minnesota Attorney, Registration No. 0182370 – Case No. A20-0473: An attorney discipline case that presents the question of what discipline, if any, is appropriate based on the facts of the matter.
Wednesday, March 3, 2021
Minnesota Judicial Center
In re Polaris, Inc., Appellant – Case No. A20-0427: Appellant Polaris Inc. petitioned for a writ of prohibition in the court of appeals, challenging a discovery ruling regarding a document. Polaris has described the document as a confidential written report prepared by outside counsel “in response to a government regulator’s investigation and threat of litigation.” The district court concluded that the report as a whole is not protected by the attorney-client privilege because the purpose of the report was to “address safety, engineering, design, and corporate practices,” not to provide legal advice. The court of appeals denied the petition for a writ of prohibition, concluding that Polaris “failed to establish that the district court ordered production of information that is clearly not discoverable.”
On appeal to the supreme court, the issue presented is whether the report is protected by the attorney-client privilege. (Hennepin County)
State of Minnesota, Appellant vs. Bryan Morgan Holl, Respondent – Case No. A19-1464: In 2017, respondent Bryan Holl was charged with first-degree and second-degree criminal sexual conduct based on allegations that he sexually abused his girlfriend’s daughter between 2012 and 2014. During an interview with a law enforcement investigator, Holl confessed to sexually abusing the girl on three different occasions, including one incident that occurred while he was deer hunting in the woods. During the jury trial, the victim testified regarding multiple incidents of sexual abuse by Holl over a five-year period, but she did not describe an incident that occurred while deer hunting with Holl. A jury found Holl guilty of all five charges. On appeal, Holl challenged the validity of his second-degree criminal sexual conduct conviction based on the deer-hunting incident because his confession was not corroborated by independent evidence as required by Minn. Stat. § 634.03 (2020). The court of appeals agreed with Holl and reversed his conviction.
On appeal to the supreme court, the issue presented is whether Holl’s conviction for second-degree criminal sexual conduct based on his confession to sexually abusing the girl while deer-hunting in the woods was corroborated by independent evidence as required by Minn. Stat. § 634.03. (Itasca County)