Minnesota Chamber’s advocacy in the courts

Decisions made by the courts can have as much consequence to businesses as does new legislation. The Minnesota Chamber of Commerce has a longstanding presence in filing legal briefs on behalf of its members, and often with successful results.

In addition, the Minnesota Chamber is increasing its presence in regulatory proceedings. The Chamber has played a prominent role in several matters before the Minnesota Public Utilities Commission and has frequently spoken on behalf of business customers at the Minnesota Pollution Control Agency.

The Chamber formalized its process for determining when to submit an amicus brief by establishing a Litigation Committee in September 2005. The Chamber will prepare a brief only if a case raises an issue of consequence to the general business community.

The most recent victory came in October 2005 when Minnesota businesses won significant protection from class-action lawsuits in a decision in favor of St. Jude Medical Inc. issued by the Eighth Circuit Court of Appeals.

Following is a summary of the Minnesota Chamber’s advocacy in the courts.

Lester Grovatt, et al vs. St. Jude Medical Inc.
(Oct. 12, 2005)

Issue: The case focused on two aspects of certification of a class of plaintiffs arising from implantation of Silzone heart valves made by St. Jude Medical Inc.

Significance: The Minnesota Chamber argued that the District Court erred in certifying a class of plaintiffs seeking “medical monitoring” relief because some class members were not actually injured from the implant. The Chamber also argued that the court erred in certifying a class of plaintiffs from around the country based exclusively on Minnesota’s consumer fraud laws.

Result: The U.S. Eighth Circuit Court of Appeals ruled in favor of the Minnesota Chamber and St. Jude on both counts. The ruling was important so Minnesota is not viewed by plaintiffs as a paradise for class-action suits.

Wooddale Builders Inc. vs. Maryland Casualty Co., et al
(May 3, 2005)

Issue: The case focused on the scope of coverage by insurance companies in lawsuits. Homeowners alleged defective workmanship and sued Wooddale Builders to recover costs of repairs due to water problems. Wooddale filed claims with its respective insurance companies. All denied coverage on the basis that the water damage occurred during an extended period and could not be traced to a single event.

Significance: The case posed both tort and process issues. The Minnesota Chamber's brief focused on the process. The Chamber argued that insurance companies have a responsibility to defend an insured party when there are multiple defendants.

Result: Decision is pending from the Minnesota Supreme Court.

Gregory Curtis, et al vs. Altria Group Inc. and Philip Morris
(Jan. 13, 2005)

Issue: This case addressed the ease with which class actions may be brought against a business and certified under the Minnesota Consumer Fraud Act.

Significance: A District Court certified a class of consumers who claimed economic injury on the basis that they did not receive the promised benefit of lowered tar and nicotine by purchasing "light" cigarettes. The Minnesota Chamber argued that if plaintiffs do not have to prove injury by anything the company had done, the precedent of such a decision would have a harmful impact on the state's business climate.

Result: A District Court certified a class of consumers who claimed economic injury on the basis that they did not receive the promised benefit of lowered tar and nicotine by purchasing "light" cigarettes. The Minnesota Chamber argued that if plaintiffs do not have to prove injury by anything the company had done, the precedent of such a decision would have a harmful impact on the state's business climate.

McNeilus Truck and Manufacturing Inc. vs. Dodge County
(Jan. 4, 2005)

Issue: The case focused on the basis for determining a property's market value. Property taxes for a light manufacturing facility in Dodge Center, Minnesota, tripled following a ruling by the Minnesota Tax Court.

Significance: The Minnesota Tax Court would not accept comparable properties as a reference point in determining the property value. The method used by the court is certain to increase values for manufacturing properties in smaller, rural communities.

Result: The Minnesota Chamber appealed the case to the Minnesota Supreme Court and won.

Marjorie Locke vs. Lutheran Brotherhood
(Jun. 29, 2001)

Issue: This case addressed the process for certifying members of a “class” in a class-action lawsuit.

Significance: A federal judge ruled that the members of the class would not be determined until after the lawsuit had been tried and a verdict reached. Lutheran Brotherhood and the Minnesota Chamber argued that the makeup of the class should be determined before the litigation is complete.

Result: The U.S. Court of Appeals refused to consider the Minnesota Chamber’s briefs, stating that all appeals should wait until the trial court proceedings are complete.

Julienne Goins vs. West Group
(Nov. 21, 2000)

Issue: This case addressed the ability of employers to control their workplace as well as clarified certain aspects of the Minnesota Human Rights Act and the definition of “sexual orientation discrimination.”

Significance: Minnesota Chamber argued that employers would have had to modify their workplaces based on the “feelings” of employees if the plaintiff prevailed. The case would have greatly expanded the concept of “accommodation” as found in the Americans with Disabilities Act.

Result: West Group and the Minnesota Chamber won on an appeal to the Minnesota Supreme Court.

Dealers Manufacturing Co. vs. County of Anoka
(Aug. 10, 2000)

Issue: This case addressed rules for determining the property tax on polluted land after it has been cleaned up.

Significance: The question was whether “stigma” could be considered in determining the property’s post-cleanup value. The plaintiffs and the Minnesota Chamber argued that even though the pollution has been eliminated, the stigma of being polluted land remains and should be factored into determining the post-cleanup market value.

Result: The Minnesota Court of Appeals agreed with the Minnesota Chamber. “Stigma” will be a factor in determining the market value on polluted land even after is has been cleaned up.

Programmed Land Inc., et al vs Patrick O’Connor, et al
(Dec. 7, 1999)

Issue: This case sought to recover damages from counties for their error in applying property tax classification rates to commercial/industrial property.

Significance: Business property owners are entitled to a lower classification rate on a portion of their taxable value. Some counties had failed to apply the lower classification rate. As a result, many businesses paid excess property tax over several years. The counties were willing to make some refunds; however, they were not willing to refund the entire overpayment.

Result: Minnesota Supreme Court agreed with the counties, saying that limited refunds were acceptable. A request by the plaintiffs and the Minnesota Chamber for a hearing before the U.S. Supreme Court was denied.

Martens, et al vs. 3M Co.
(Sep. 9, 1999)

Issue: This case addressed whether broad statements in an employee handbook could be considered a contract.

Significance: 3M Co.’s employee handbook discussed the equivalent career tracks of scientists and administrators. The plaintiffs had chosen the scientific track and were not being compensated as much as employees on the administrative track. The scientists asserted that statements in the handbook entitled them to additional compensation.

Result: The Minnesota Court of Appeals agreed with 3M, saying the handbook material was illustrative and did not constitute a contract. This case is significant to all Minnesota employers with employee handbooks and do not wish it to be considered a contract between them and their employees.

American Express Financial Advisors Inc. vs County of Carver
(Jun. 2, 1997)

Issue: This case addressed the process for valuing a corporate headquarters building.

Significance: Carver County argued that these buildings should be valued based on replacement cost. The Minnesota Chamber argued that the buildings should be valued like other commercial/industrial property (i.e. based on income they produce or sale price of comparable property). Using “replacement cost” would substantially increase the value of headquarters and other distinctive buildings because duplicating the structure at current prices would be far more expensive than the original construction.

Result: Minnesota Chamber won on appeal. Had the original decision stood, Minnesota’s headquarters companies could have seen substantial property tax increases, regardless of the market value of their headquarters facility.

Luna vs. Herc-U-Lift, et al
(Apr. 8, 1996)

Issue: This case addressed the ability of employers who are self-insured for workers’ compensation to settle third-party claims triggered by a work-related injury.

Significance: The Chamber’s involvement in this case had no effect on the injured workers’ benefits. Its intervention instead focused on reducing litigation expenses when an injured worker sued a third party and then the third party sued the employer.

Result: Minnesota Chamber lost the appeal before the Minnesota Court of Appeals.

State of Minnesota, et al vs. Phillip Morris Inc., et al
(Dec. 26, 1995)

Issue: This case addressed how much information defendants can obtain from a company without specific reason.

Significance: Phillip Morris appealed a procedural motion regarding the state’s litigation with tobacco companies. The trial court judge issued a ruling, allowing the state to obtain extensive information from tobacco companies without specific reason. The Minnesota Chamber joined the appeal on the basis that the ruling could increase the number of “fishing expeditions” by plaintiffs’ attorneys.

Result: Minnesota Chamber lost appeal before Minnesota Supreme Court.

Phelps vs. Commonwealth Land Title Insurance Co.
(Jul. 20, 1995)

Issue: This case established precedent regarding the discretion of trial courts in determining damages.

Significance: The Minnesota Chamber argued that the trial court had awarded damages (i.e. back pay, mental anguish, attorney fees) that were excessive and that the court had abused its discretion by doubling the actual damages. The trial court, Court of Appeals and Supreme Court all ruled that damages could be doubled even though there was no specific finding that the plaintiff would not be adequately compensated by an award of actual damages.

Result: Minnesota Chamber lost appeal before Minnesota Supreme Court.

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Minnesota Chamber’s advocacy in the courts