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Tuesday, Sept. 1, 2009

State of Ohio v. Michael S. Arnold, Case no. 2008-1693
Franklin County

Ohio Grocers Association et al. v. William W. Wilkins [Richard A. Levin], in his official capacity as Ohio Tax Commissioner, Case no. 2008-2018
Franklin County

State of Ohio v. Richard L. Underwood, Jr., Case nos. 2008-2133 and 2008-2228
Montgomery County

State of Ohio v. Douglas Futrall, Case no. 2008-2391
Lorain County

State Farm Mutual Automobile Insurance Company and State Farm Fire and Casualty Company v. Laura Grace, Elizabeth Garcia, Ladon Ruffin, Dorian Jones, Angela J. Webb, and Patricia Schwab, Case no. 2009-0122


Does Admitting Evidence of Child’s Out-of-Court Statements Violate Defendant’s Right to Confront Accuser?

State of Ohio v. Michael S. Arnold, Case no. 2008-1693
Franklin County

ISSUE:  When a child who is an alleged victim of sexual abuse is not available to testify or be cross-examined in court, does a trial court violate the defendant’s constitutional right to confront witnesses against him by admitting into evidence a video of an interview with the victim that was conducted by a social worker employed by a child advocacy center?

BACKGROUND: In December 2005, the mother of a four-year-old girl identified as M.A. called police to report her suspicion that the child had been sexually assaulted that evening by Michael Arnold of Columbus. The child was transported to an emergency room where a rape kit examination was performed.  She was then was sent home overnight. The following morning M.A. was taken to the Center for Child and Family Advocacy (CCFA), a special multidisciplinary unit for victims of  child and domestic abuse located at Nationwide Children’s Hospital. Kerri Marshall, a social worker employed by CCFA, conducted an in-depth interview with M.A. outside the presence of her mother during which she asked a number of questions about what had taken place between the child and Arnold. The interview was viewed live via closed-circuit television by several observers in another room including a police detective.  The entire interview was also recorded on a digital video disk. Following the interview, medical personnel conducted another physical examination of M.A.

Based on M.A.’s statements during the CCFA interview and other evidence, Arnold was arrested and charged with two counts of rape of a child under the age of 10. The court determined that M.A. was unavailable to testify and be cross examined in court. Over Arnold’s objections, the court  allowed the state to show the video of M.A.’s interview with Marshall at the CCFA to the jury. Arnold was subsequently convicted on one count of child rape and sentenced to life in prison.

Arnold appealed, arguing that in admitting M.A.’s out-of-court statements into evidence without an opportunity for cross-examination the trial court had violated his constitutional right to confront witnesses against him. The 10th District Court of Appeals upheld Arnold’s conviction, holding that M.A.’s out-of-court statements during the CCFA interview were admissible under an exception to the hearsay rule because they were not “testimonial” statements elicited through an interrogation by a police employee or agent, but rather were statements elicited by a social worker for the purpose of determining what additional medical examination and treatment the child might require.

Arnold sought and was granted Supreme Court review of the 10th District’s ruling.

Attorneys for Arnold argue that the 10th District’s ruling is contrary to decisions of the U.S. and Ohio Supreme Courts holding that an unavailable witness’s out-of-court statements are “testimonial” in nature, and therefore barred by the hearsay rule, if the primary purpose of the interview in which those statements were elicited was not to respond to a current emergency situation but rather to assist in the “investigation of possibly criminal past conduct.”  They point out that the child advocacy center at which M.A. was interviewed is a cooperative project in which area law enforcement agencies and prosecutors are active partners, and assert that the statutory language authorizing such centers indicates that one of their key purposes is to investigate, gather evidence and prosecute acts of child abuse including sexual abuse. They argue that the facts that M.A. had already been examined and released from the emergency room the previous evening, that Marshall knew police were watching her interview with M.A. at the time it took place, and that the interview was recorded for potential future use indicate that Marshall’s questioning of M.A. was not a typical medical interview but rather an effort to investigate suspected criminal conduct.

Attorneys for the state respond that the Supreme Court cases cited by Arnold involved out-of-court statements made by witnesses while they were being questioned by police personnel, not by a patient being interviewed in a hospital setting by a social worker who was not employed by a law enforcement agency. They point to a 2006 decision, State v. Stahl, in which the Supreme Court of Ohio held that statements made by a crime victim who later died to a nurse during a medical interview were admissible without cross examination. In Stahl, they assert, the Court held that witness statements made to non-law enforcement personnel are not “testimonial” unless the witness should reasonably have understood that her statements could be used later as evidence at trial. In this case, they argue, a four-year-old being interviewed in a hospital by a social worker could not have understood or expected that her statements would be used as trial evidence, and the trial and appellate courts correctly held that M.A.’s statements to Marshall were non-testimonial in nature and therefore admissible at trial without cross-examination.

NOTE: Amicus curiae (friend of the court) briefs supporting the position of Arnold have been submitted to the Court by the Ohio Public Defender and the Ohio Association of Criminal Defense Lawyers.  Amicus briefs supporting the state’s position have been entered by the Ohio Attorney General’s Office, Nationwide Children’s Hospital and the Center for Child and Family Advocacy.

Contacts
David L. Strait, 614.719.8872, for Michael Arnold.

Kimberly Bond, 614.462.3555, for the state and Franklin County prosecutor’s office.

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Is Assessment of State Commercial Activity Tax on Grocers an Unconstitutional ‘Excise Tax on Food?’

Ohio Grocers Association et al. v. William W. Wilkins [Richard A. Levin], in his official capacity as Ohio Tax Commissioner, Case no. 2008-2018
Franklin County

ISSUE:  By requiring Ohio grocers and food wholesalers to pay state commercial activity tax based on their gross business receipts, including receipts from the sale of food, is the state tax commissioner violating provisions of the Ohio Constitution that prohibit the levying or collection of an “excise tax upon the sale or purchase of food?”

BACKGROUND:  In 2005, as part of legislation overhauling Ohio’s business tax structure, the General Assembly eliminated the former state corporate franchise tax and tangible personal property tax and replaced them with a new Commercial Activity Tax (CAT) that is assessed on all businesses in the state based on a percentage of  their annual gross business receipts above $1 million. 

A group of plaintiffs including individual grocery store owners, food wholesalers and the Ohio Grocers Association filed suit in the Franklin County Court of Common Pleas seeking a declaratory judgment that the state tax commissioner is prohibited from assessing the CAT against any of their gross business receipts arising from the sale of food for off-premises consumption. The plaintiffs, who also sought a refund of  prior-year CAT taxes they have paid on their receipts from food sales since 2005, based their claim on provisions of the Ohio Constitution that prohibit the state from levying or collecting any “excise tax upon the sale or purchase of food.” 

The trial court ruled in favor of the tax commissioner, holding that the cited constitutional provisions bar only the collection of state sales tax on the sale or purchase of food, and that the CAT was not a tax levied on food purchases but rather a franchise tax levied on all businesses for the privilege of doing business in Ohio. On review, the 10th District Court of Appeals reversed the trial court and ruled that imposing CAT liability on a grocer or food wholesaler based on a percentage of its business receipts from the sale of food constituted levying an unconstitutional “excise tax on the sale of food.” The tax commissioner sought and was granted Supreme Court review of the 10th District’s ruling.

Attorneys for the tax commissioner point out that the prohibition against an “excise tax” on retail food sales set forth in Section 3, Article II of the Ohio Constitution was enacted by a citizens’ initiative in 1936 for the express purpose of exempting consumer food purchase transactions from the state’s sales tax, which had been adopted in 1934 and initially imposed the tax on the purchase of most food items.  Following the adoption of Section 3, and later Section 13 addressing wholesale food transactions, they note, the legislature amended the sales tax statute to exempt food purchases from that specific tax, but did not exempt grocers or other food sellers from paying either the state’ corporate franchise tax or tangible property tax, both of which were assessed according to formulas that included annual sales revenues.

They note that the legislature adopted the CAT in 2005 not as a substitute for the sales tax but specifically to replace the corporate franchise tax and tangible property tax that were previously assessed against business entities, including grocers, for the privilege of doing business in Ohio. They also urge the Court to affirm the trial court’s findings that because the CAT is assessed on businesses and not consumers, and is not calculated or collected on a per-transaction basis but rather levied annually based on total business revenues, it is not a constitutionally prohibited “excise tax upon the sale or purchase of food.”

Attorneys for the Grocers Association and other plaintiffs urge the Court to affirm the 10th District’s findings that: 1) the constitutional prohibition against taxing food sales is not limited to the state sales tax but rather bans any “excise tax” upon the purchase or sale of food; and 2) the term “excise tax” refers to non-sales taxes including a tax on the privilege to do business; and 3) a tax on business receipts from the sale of food is a tax on food, regardless of whether it is collected from the buyer or the seller and regardless of whether it is levied on a per-transaction basis on assessed and collected once a year.

Contacts
Benjamin C. Mizer, 614.466.8980, for the State Tax Commissioner.

Gerhardt A. Gosnell II, 614.221.4000, for the Ohio Grocers Association et al..

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Is Jointly Recommended Sentence Subject to Appeal if Trial Court Failed to Consolidate Convictions for Allied Offenses?

State of Ohio v. Richard L. Underwood, Jr., Case nos. 2008-2133 and 2008-2228
Montgomery County

ISSUE: When a trial court fails to consolidate into a single conviction two or more criminal counts charging a defendant with “allied offenses of similar import,” does the defendant waive his right to appeal that error by entering into a plea bargain admitting the charged allied offenses and a joint sentencing recommendation agreement with the state, or does the trial court’s failure to consolidate the allied charges constitute “plain error” that renders the defendant’s jointly recommended sentence appealable?

BACKGROUND: Ohio’s “allied offenses” statute, R.C. 2941.25, states that when the conduct of a criminal defendant committed against the same victim may support his conviction for two crimes that are “allied offenses of similar import,” (e.g., assault and aggravated assault) the defendant may be indicted and tried for both of the allied offenses, but if he is found guilty on both counts, the allied offenses must be consolidated into a single conviction punishable by a single sentence.

A different provision of state law, R.C. 2953.08(D), specifies that when a defendant has joined with the state in recommending a sentence for his offense(s) as part of a plea bargain, and the court has imposed the jointly recommended sentence, the defendant is barred from later appealing that sentence so long as it is one “authorized by law.”

In this case, Richard Underwood of Dayton, a construction contractor, was charged with multiple counts of theft and aggravated theft for stealing more than $100,000 from several different property owners by soliciting substantial advances from them for building projects and then failing to pay subcontractors and abandoning the projects without returning their advances.  As part of a plea bargain with the Montgomery County Prosecutor, Underwood entered no contest pleas to two counts of aggravated theft and two counts of theft in exchange for the state’s agreement to a recommended sentence of two years imprisonment with no objection by the state to early judicial release. The trial court found Underwood guilty on all four counts and, consistent with the joint sentencing recommendation, sentenced him to prison terms of one year on the first count of aggravated theft, two years on the second count of aggravated theft, and six months on each of the two theft counts, with all terms to be served concurrently (at the same time).  The result was a two-year term of imprisonment.

In reviewing the case, the 2nd District Court of Appeals noted that the two aggravated theft counts and two theft counts were allied offenses of similar import that the trial court should have consolidated into single convictions for each of those crimes. The state acknowledged that the convictions should have been consolidated as allied offense, but argued that vacating one of the convictions for each offense would not make any actual change in the term of Underwood’s imprisonment, and that in any case the court of appeals was barred by R.C 2953.08(D) from reviewing Underwood’s sentence because he had agreed to it and jointly recommended it to the court as part of his plea bargain. The 2nd District vacated two of Underwood’s convictions and the sentences imposed for those counts, leaving him with a total prison term of two years.  The appellate panel held that R.C. 2953.08(D) did not bar appellate review of Underwood’s jointly recommended sentence because the trial court had sentenced him for four convictions when he should have been sentenced for only two, and therefore the sentences imposed for the two allied offenses that were vacated were not sentences “authorized by law.”

The 2nd District certified that its ruling on the appealability of a jointly recommended sentence was in conflict with decisions in several other appellate districts.  The Supreme Court agreed to review the case to resolve the conflict among appellate districts.

Attorneys for the state assert that every other court of appeals district that has ruled on the issue has held that R.C.2953.08(D) precludes the appeal of a jointly recommended sentence, even in cases where the trial court failed to consolidate separate convictions for allied offenses into a single conviction.  They argue that the statutory provision barring appellate review of a jointly recommended sentence as long as it is “authorized by law” is satisfied if the sentence imposed by the trial court was within the sentencing range for the offense(s) for which the defendant was validly convicted.  In this case, they say, Underwood could have been sentenced to as much as five years in prison for a single count of aggravated theft, so his net sentence of two years for multiple counts is clearly within the statutory range for aggravated theft and therefore is a sentence “authorized by law” regardless of the fact that the court failed to consolidate allied offenses.

Attorneys for Underwood urge the Court to affirm the holding of the 2nd District that the trial court acted in violation of R.C. 2941.25 in convicting him on four counts when two of those counts were allied offenses that must be consolidated.  Because Underwood’s  jointly recommended sentence included penalties for two convictions that were contrary to law, they assert,  that sentence was not one “authorized by law,” and the court of appeals was not barred by R.C. 2953.08(D) from reviewing and vacating his original sentence even though he agreed to that sentence as part of a plea bargain.

Contacts
Kelly D. Madzey, 937.225.5775, for the state and Montgomery County prosecutor’s office.

Claire R. Cahoon, 614.466.5394, for Richard Underwood.

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When One of Offender’s Convictions May Not Be Sealed, Does Law Allow Sealing Record of Other Offenses?

State of Ohio v. Douglas Futrall, Case no. 2008-2391
Lorain County

ISSUE: Under a state law that allows remedial expungement of misdemeanor convictions from the record of a first offender under certain circumstances, is a trial court barred as a matter of law from sealing the record of several offenses that are eligible for expungement if one of the defendant’s convictions, charged in the same indictment, involves an offense that is not eligible for expungement?

BACKGROUND: Based on a single incident in 2001 in which he engaged in a verbal altercation with his estranged wife, Douglas Futrall of Lorain was charged with and entered guilty pleas to five misdemeanor offenses.  He was sentenced to a term of community control from which he obtained an early release after meeting all of the conditions imposed by the court, and he has not reoffended since that time. In 2007, Futrall filed a petition under Ohio’s expungement statute, R.C. 2953.32, asking the trial court to seal the record of four of his 2001 misdemeanor convictions.  In that petition, Futrall acknowledged that the remaining conviction, for aggravated menacing, is classified as a violent offense and therefore is not eligible to be sealed under the expungement statute.

The trial court indicated that Futrall met the statutory criteria for sealing the record of his four eligible convictions. The judge ruled, however, that because the record of his aggravated menacing indictment and conviction could not be sealed, as a matter of law his other convictions could not be sealed either. Futrall appealed that ruling.  On review, the 9th District Court of Appeals affirmed the decision of the trial court.  In its opinion, the court of appeals held that because Futrall’s four eligible offenses were recorded in the same arrest reports, charged in the same indictment and decided in the same judgment and sentencing entries as his ineligible conviction for aggravated menacing, “it would be impossible” for the trial court to comply with the requirements of the expungement statute by completely eliminating all records of the four eligible counts while at the same time retaining all the records documenting his aggravated menacing charge and conviction.

Futrall sought and was granted Supreme Court review of the 9th District’s decision.

His attorneys assert that because the trial court based its denial of his petition on the judge’s legal interpretation of the expungement statute, rather than on a finding of fact, the court of appeals erred by reviewing the trial court’s ruling on an abuse-of-discretion standard, rather than conducting its own independent analysis of R.C. 2953.32 as applied to cases involving multiple offenses.  They argue that the 9th District offered no support for its assertion that it would be “impossible” to delete references to Futrall’s four eligible convictions while retaining records of the aggravated menacing conviction.  They suggest that replacing the original multi-count indictment and judgment entry with substitutes listing only the aggravated menacing count would accomplish the remedial purpose of the expungement statute, which this Court has indicated should be “liberally construed” in favor of eligible past offenders.

The Lorain County prosecutor’s office urges the Court to affirm the 9th District’s ruling.  They point to multiple decisions by other court of appeals districts holding that a trial court’s grant or denial of expungement is reviewed under an abuse of discretion standard, and note that Futrall acknowledged that standard in his written appellate brief before asserting a different standard during oral argument. They also point to language in the expungement statute that repeatedly refers to removal of all information about a “case,” from court records, and argue that the 9th District correctly held that when multiple criminal  counts are charged in a single indictment and recorded in the same judgment and sentencing entries, there is no practical way a trial court could eliminate from its files all documents referring to some counts yet leave required records of other charges and convictions in  place.

Contacts
D. Chris Cook, 440.246.2665, for Douglas Futrall.

Mary R. Slanczka, 440.329.5396, for the state and Lorain County prosecutor’s office.

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May Auto Insurer Offset Amount of Medical Payments Against Policy’s Stated Uninsured Motorist Coverage?

State Farm Mutual Automobile Insurance Company and State Farm Fire and Casualty Company v. Laura Grace, Elizabeth Garcia, Ladon Ruffin, Dorian Jones, Angela J. Webb, and Patricia Schwab, Case no. 2009-0122

ISSUE: When an auto insurance policy lists separate premiums and separate coverage limits for medical payments and for losses caused by an uninsured or underinsured driver, do Ohio’s insurance laws allow the insurer to enforce policy language stating that any amounts paid to a policyholder for medical payments will be set off (subtracted from) the benefits payable under the uninsured motorist coverage in the same policy?

BACKGROUND: In this case, the State Farm Insurance Company has been sued in federal court by Laura Grace and a group of other policyholders who filed claims seeking recovery under their State
Farm auto insurance policies for losses they incurred as a result of traffic accidents caused by uninsured drivers. In each case, State Farm paid for the portion of the policyholder’s losses attributable to medical expenses  under the “medical payments” coverage in their policies, and subtracted the amounts of those medical payments from the total amount of coverage stated in the policy for losses caused by an uninsured or underinsured motorist (UM/UIM).

The plaintiffs’ complaints, which have been consolidated into a single class action lawsuit by the U.S. District Court for the Northern District of Ohio, allege that when an auto insurance policy charges separate premiums for medical payments and UM/UIM coverage, and lists separate policy limits for each type of coverage, Ohio law does not allow the  insurer to “set off” amounts paid under the medical payments part of the policy from the stated amount of coverage payable under the UM/UIM portion of the same policy.  The plaintiffs filed a motion for judgment on the pleadings.  Prior to ruling on that motion, the district court asked the Supreme Court of Ohio to analyze the applicable provision of state law, R.C. 3937.18, and advise the federal court whether the version of that statute in effect since it was amended in October 2001 allows insurers to enforce a policy clause “setting off” amounts paid under the medical payments coverage against the coverage available under the UM/UIM provisions of the same policy.

The Court has agreed to answer the certified question.

Attorneys for the plaintiffs point to three prior Supreme Court decisions and multiple rulings by Ohio appellate courts holding that the type of “set off” provision included in the State Farm policies being challenged in this case is void and unenforceable, and note that the company dropped similar language from its policies in the wake of those decisions before reinserting it in 2005.  They argue that the current medical payments set-off suffers from the same legal defect cited in the earlier court decisions, i.e., that it allows an insurer to charge policyholders separate premiums for two separate categories of coverage, but then effectively denies them any recovery for medical expenses under the UM/UIM portion of the policy.

Attorneys for State Farm assert that R.C. 3937.18, as amended in October 2001 by the passage of  S.B. 97, eliminated the legal basis for the prior Supreme Court and appellate decisions cited by the plaintiffs and now allows insurers to place limitations on the coverage provided under the UM/UIM portion of their policies. They assert  that the medical payments off-set included in the policies issued to Grace and the other plaintiffs falls within the limitations of coverage permitted under the post-S.B. 97 version of the statute, and the company’s denial of “double recovery” for the same medical costs under separate sections of its policies is valid and enforceable.

Contacts
Mark A. Johnson, 614.462.2698, for State Farm Insurance Companies.

James A. DeRoche, 216.696.9330, for Laura Grace and other class action plaintiffs.

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These informal previews are prepared by the Supreme Court's Office of Public Information to provide the news media and other interested persons with a brief overview of the legal issues and arguments advanced by the parties in upcoming cases scheduled for oral argument. The previews are not part of the case record, and are not considered by the Court during its deliberations.

Parties interested in receiving additional information are encouraged to review the case file available in the Supreme Court Clerk's Office (614.387.9530), or to contact counsel of record.