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In the Matter of: Meredith Poling, Alleged Delinquent Child, Case no. 2008-1562
3rd District Court of Appeals (Hardin County)
Stammco, LLC, et al. v. United Telephone Co. of Ohio et al., Case no. 2008-1822
6th District Court of Appeals (Fulton County)
State of Ohio v. Rusty Jordan, Case nos. 2008-2119 and 2008-2172
3rd District Court of Appeals (MarionCounty)
Elevators Mutual Insurance Company v. J. Patrick O'Flaherty's, Inc., et al., Case no. 2009-0321
6th District Court of Appeals (Sandusky County)
Does the State Have a Right to Appeal Juvenile Court’s Ruling Denying Discretionary Bindover to Adult Court?
In the Matter of: Meredith Poling, Alleged Delinquent Child, Case no. 2008-1562
3rd District Court of Appeals (Hardin County)
ISSUE: In a case where the state seeks a discretionary ruling by a juvenile court binding over a juvenile offender under 16 years of age for trial in adult court, if the juvenile court issues a ruling denying the requested bindover based on its determination that the juvenile is “amenable to rehabilitation through the juvenile justice system,” does the state have a right to appeal the trial court’s decision to a court of appeals, or must the state file a motion for leave to appeal, which the court of appeals may either grant or deny in its discretion?
BACKGROUND: In this case, 15-year-old Meredith Poling of Mount Victory was charged in the Hardin County Juvenile Court with a delinquency count of murder for the March 2007 shooting death of her mother.
The county prosecutor’s office filed a motion asking the juvenile court to issue a discretionary order binding over Meredith to the Hardin County Court of Common Pleas for trial as an adult. In ruling on that motion, the juvenile court was required to conduct a two-part inquiry. The court first made a required finding that there was probable cause to believe that Meredith committed the acts for which she was charged. The judge then proceeded with the second part of the discretionary bindover process, in which the court is required to conduct a hearing and make a judicial determination that either a) the juvenile offender is “amenable to rehabilitation within the juvenile justice system,” or b) it is necessary for the safety of the community that the juvenile offender be subject to adult penalties.
After reviewing evidence submitted by the prosecutor and Meredith’s defense attorneys, including reports from family services workers and counselors who had interacted with Meredith and the results of psychological testing conducted by a court-appointed expert, the juvenile court ruled that Meredith was amenable to rehabilitation through the juvenile justice system and denied the state’s motion to bind her over for trial in adult court. The prosecutor filed a motion with the 3rd District Court of Appeals seeking leave to appeal the denial of bindover. The 3rd District declined to grant leave for an appeal, ruling that the juvenile court had discretion either to grant or deny bindover, and the state had not raised any issue in its motion that entitled it to appellate review of the juvenile court’s decision.
The state sought and was granted Supreme Court review of the 3rd District’s refusal to hear its appeal.
Arguing on behalf of the state, the Hardin County prosecutor’s office points to the Supreme Court of Ohio’s recent decision in In re A.J.S. (October, 2008) holding that the state had a right to immediate appellate review of a juvenile court ruling denying a motion for discretionary bindover of a juvenile offender based on the juvenile court’s finding of no probable cause. In A.J.S., they assert, this Court held that the state had a right to appeal the denial of bindover based on lack of probable cause because such a ruling effectively barred the state from ever prosecuting a murder charge against the juvenile defendant. They argue that the juvenile court’s ruling in this case should also be subject to an appeal of right (as opposed to a discretionary motion for leave to appeal), because the trial court’s holding that Meredith was amenable to rehabilitation in the juvenile system, if not overturned on appeal, permanently barred her prosecution as an adult.
Attorneys for Meredith respond that there is a significant difference between a juvenile court’s denial of bindover based on lack of probable cause, which has the same effect as dismissal of an adult offender’s criminal indictment, and denial of bindover based on the court’s evidentiary determination that, even though there is probable cause that the accused juvenile committed the charged acts, he or she should be tried and sentenced within the juvenile justice system because that system is most likely to result in his or her rehabilitation. They argue that Ohio statutes and case law establish a strong presumption that even serious juvenile offenders under the age of 16 should be prosecuted as juveniles and not as adults, and give juvenile courts broad discretion to evaluate evidence and make final judgments about if and when there is justification for prosecuting an offender under 16 as an adult. In this case, they point out, the state was not without a remedy because it had and exercised an opportunity to seek appellate review of the juvenile judge’s denial of bindover. In denying the state’s motion for leave to appeal, they say, the 3rd District found that the juvenile court acted within its discretion in denying bindover, and held that the state had not identified sufficient grounds to justify appellate review of the juvenile judge’s ruling.
Contacts
Colleen P. Limerick, 419.674.2284, for the Hardin County prosecutor’s office.
Elizabeth R. Miller, 614.466.5394, for Meredith Poling.
May Phone Company’s Customers Pursue Class Action for Unauthorized Third-Party Charges on Their Bills?
Stammco, LLC, et al. v. United Telephone Co. of Ohio et al., Case no. 2008-1822
6th District Court of Appeals (Fulton County)
ISSUE: Under the Ohio rule of civil procedure that authorizes “class action” lawsuits, may a group of phone company customers who had unauthorized third-party charges added to their phone bills combine their damage claims against the phone company into a single court action, or must each customer file a separate lawsuit?
Background: Rule 23 of the Ohio Rules of Civil Procedure authorizes and sets guidelines for the certification and prosecution of class action lawsuits. In a class action, a large group of individual plaintiffs who claim that they have all suffered the same or similar injuries as a result of the same harmful conduct by the same defendant or group of defendants are permitted to join their claims together and pursue recovery for their alleged damages through a single, collective court action.
As the required first step in pursuing a class action, the plaintiffs must obtain “certification” of the class by establishing to the satisfaction of the trial court specific common criteria that apply to each of the individual claimants and their claims, and by showing that a single lawsuit jointly prosecuted by the defined class is the best way to fairly and efficiently adjudicate the plaintiffs’ claims against the defendant.
In this case, Kent and Carrie Stamm of Archbold, the owners of a business called The Pop Shop, received their local phone service from United Telephone Company of Ohio, which is a subsidiary of Sprint Nextel Corporation (Sprint). In addition to the regular charges for their local and long distance service, the monthly billing statement they received from Sprint for October 2004 included an $87.98 charge from a third-party vendor named Bizopia for Web site development and hosting services that the Stamms had not authorized and were not receiving. A subsequent review of their prior phone bills revealed that they had been billed by Sprint on multiple other occasions for purported calls, transactions and other charges from third-party vendors that the Stamms did not recognize and from whom they had obtained nothing – a practice known in the telecom industry as “cramming.”
The Stamms subsequently joined with several other Sprint customers in filing a class action lawsuit against the company in the Fulton County Court of Common Pleas. Their complaint alleged that Sprint caused financial harm and failed to act in good faith toward its customers by negligently enabling third-party vendors to add charges to their monthly phone bills without prior authorization from the customer; by failing to take action to prevent continuing fraud by vendors known to be the source of past fraudulent charges; and by refusing to block all third-party charges to customers’ phones on request despite the company’s ability to do so. The suit also alleged that Sprint obtained unjust enrichment by sharing in the profits realized by unauthorized vendors by acting as their paid billing agent and collection service.
In seeking certification by the trial court to pursue their suit as a class action, the plaintiffs identified the class of persons for whom relief was sought as “All individuals, businesses or other entities in the State of Ohio who are or who were within the past four years local telephone customers of United Telephone Company of Ohio d.b.a. Sprint and who were billed for charges on their local telephone bills on behalf of third parties without their permission.” The trial court granted certification of the class as specified by the plaintiffs and authorized the case to proceed as a class action. Sprint appealed that ruling, arguing that the class as defined by the trial court did not meet requirements for class action certification set forth in Civil Rule 23. The 6th District Court of Appeals affirmed that the class as certified by the trial court met the requirements of Civil Rule 23 for purposes of pursuing the plaintiffs’ claims for money damages against Sprint.
Sprint sought and was granted Supreme Court review of the 6th District’s ruling. Their attorneys argue that the class of plaintiffs certified by the trial court is an impermissible “fail-safe” class because it defines the group of persons eligible to sue as all those eligible for recovery if the court finds the defendant liable for tortious conduct set forth in the complaint. As a result, they say, if the trial court found that Sprint was not liable for losses to its customers caused by third-party charges included in their phone bills, the certified class of persons eligible to sue would completely disappear, because there would be no Sprint customer with a right to recover from the company for financial losses arising from its billing practices.
Attorneys for the Stamms and other plaintiffs respond that membership in the class of plaintiffs certified by the trial court and affirmed by the court of appeals is not a prohibited “fail-safe” classbecause membership in the class does not require a prior finding that a member is entitled to recover damages from Sprint. They say the certified class consists of all Sprint customers who had unauthorized third-party charges added to their phone bills, and point out that membership in the class does not require a prior finding that the third-party charges on their bills were fraudulent or that Sprint is liable to them for participating in that fraud. They assert that the sole purpose of class certification is to unambiguously define the group of plaintiffs who wish to pursue claims against a common defendant. They argue that whether any or all of the third-party charges on a given customer’s phone bills were fraudulent is not a question that must be answered before Sprint’s liability for its billing practices is determined, but is rather a question to be answered later, when and if the court determines the amounts of damages to which individual class members are entitled.
Contacts
Michael K. Farrell, 216.621.0200, for United Telephone Company of Ohio d.b.a Sprint Nextel Corp.
Dennis E. Murray Sr., 419.624.3000, for Stammco LLC d.b.a. The Pop Shop, and other plaintiffs.
In Prosecution for Escape, Must State Prove Offender Was Informed of Post-Release Control In Open Court?
State of Ohio v. Rusty Jordan, Case nos. 2008-2119 and 2008-2172
3rd District Court of Appeals (MarionCounty)
ISSUE: In order to prove that a defendant is guilty of the crime of escape for violating the terms of a post-release control order, is the state required to present evidence not only that a term of post-release control was included in the trial court entry journalizing the defendant’s original sentence, but also present evidence that the defendant was notified in open court at the time sentence was pronounced that he would be subject to a term of post-release control?
BACKGROUND: In December 2006, prior to his release from the Marion Correctional Institution after serving a 12-month sentence for three felony convictions, Rusty Jordan of Marion was advised that he would be subject to a one-year term of post-release control by the Adult Parole Authority. Jordan signed forms acknowledging that he must meet in person monthly with his parole officer, keep the parole officer informed of his current residence, and comply with other terms and conditions of post-release control. Jordan also acknowledged that he could be subject to prosecution for the third-degree felony offense of escape if he failed to comply with these requirements.
After complying with the terms of the control order for several months, Jordan could not be located by police at his listed place of residence in mid-April 2007 and was arrested and jailed for 30 days when he appeared for a scheduled meeting with his parole officer on May 2. After being released on June 4, Jordan failed to show up for scheduled meetings with the parole officer on July 3 and July 18. On August 5, the adult parole authority issued an order for his arrest. Officers dispatched to Jordan’s listed residence found that the apartment was empty. After again failing to comply with the terms of his control order in August and September, Jordan was located by police and arrested in October 2007 at a new residence to which he had moved without informing his probation officer.
He was subsequently indicted on a felony count of escape. At trial, the state introduced testimony by Jordan’s probation officer that Jordan had been repeatedly advised that he was under a post-release control order and the legal consequences of violating that order, and also submitted a certified copy of the journal entry recording Jordan’s 2005 felony convictions and the trial court’s sentencing order, which included a term of post-release control of up to three years. The trial court found Jordan guilty of escape and sentenced him to a prison term of three years.
Jordan appealed his conviction, arguing that the state had not proved that he was properly under detention by the parole authority at the time of his “escape” because prosecutors had not submitted evidence that the trial court had advised him in open court during his 2005 sentencing hearing that he would be subject to post-release control. On review, the 3rd District Court of Appeals affirmed Jordan’s conviction for escape, but certified that its decision conflicted with a 2007 decision in which the 9th District Court of Appeals overturned a similar conviction based on the state’s failure to prove that the defendant’s original sentence included notice of a term of post-release control. The Supreme Court has agreed to review the case to resolve the conflict between appellate districts.
Attorneys for Jordan cite recent Supreme Court of Ohio decisions holding that a term of post-release control imposed on an offender is void and unenforceable if the sentencing court did not both advise the defendant of that sanction in open court at the time sentence was pronounced, and include post-release control in the journal entry recording the defendant’s conviction and sentence. They argue that, in order to convict Jordan of escaping from a lawful term of detention, the state was required to prove that he was properly under the authority of the adult parole authority at the time he failed to comply with its order. While the state produced a journal entry that included post-release control, they argue, it failed to produce evidence that Jordan was advised of post-release control in open court at the time he was sentenced. Accordingly, they assert, the state did not prove an essential element of the crime of escape, and Jordan’s conviction must therefore be vacated.
Attorneys for the Marion County prosecutor’s office respond that Jordan was advised on multiple occasions about the post-release control portion of his sentence, and acknowledged his duty to comply with the terms of the parole authority’s order by signing a written notification form prior to his release from prison and checking in with his probation officer on multiple occasions after his release. They argue that the state met its burden of proof on the escape charge by producing a copy of the trial court sentencing entry that included post-release control and showing by evidence that Jordan was fully aware of his duty to comply with the term of the parole authority’s order and violated those terms by failing to report and by changing his residence without notifying his probation officer.
They also point out that Jordan never filed a legal challenge to the validity of his post-release control order at the time of his release from prison, during the months he was out of prison and complying with the terms of that order, or during his trial on the escape charge, but only raised the issue of an in-court notification after being convicted of escape. They point out that the Supreme Court decisions cited by Jordan in his pleadings were all brought by offenders in direct appeals of their post-release control sanctions based on a specific claim that the sentencing court neglected to notify them in open court at the time sentence was pronounced. They argue that those decisions do not impose a requirement on the state to produce a transcript of the defendant’s original sentencing hearing in order to support a subsequent conviction for escape.
Contacts
Denise Martin, 740.223.4290, for the Marion County prosecutor’s office.
Stephen P. Hardwick, 614.466.5394, for Rusty Jordan.
Is No-Contest Plea to Arson Charge Admissible Against Policyholder In Civil Suit Disputing Insurance Claim?
Elevators Mutual Insurance Company v. J. Patrick O'Flaherty's, Inc., et al., Case no. 2009-0321
6th District Court of Appeals (Sandusky County)
ISSUES:
- When a policyholder has entered a plea of no contest and has been convicted on a criminal count of arson, may a trial court admit evidence of that conviction in a subsequent civil lawsuit where an insurance company has denied coverage for fire damage to the policyholder’s property under a policy exclusion for losses caused by the insured party’s “criminal act?”
- When an insurance policy lists a business entity as the insured party, and identifies two co-owners of the business who are husband and wife as loss payees, if one co-owner is convicted of a criminal act that caused damage to the business’ property, does a policy exclusion for damage caused by the insured’s criminal act nullify the insurer’s liability to the innocent co-owner for his/her share of insured losses arising from the property damage?
BACKGROUND: In Ohio, a person charged with a criminal offense is required to enter one of three possible pleas: “guilty,” which admits that the defendant committed the offense with which he is charged; “not guilty,” which denies that the defendant committed the charged offense; or “no contest.”
Ohio Criminal Rule11(B)(2) explains that “(t)he plea of no contest is not an admission of the defendant’s guilt, but is an admission of the truth of the facts alleged in the indictment, information or complaint.” The rule goes on to specify that “the plea (of no contest) or admission shall not be used against the defendant in any subsequent civil or criminal proceeding.” Similarly, Ohio Evidence Rule 410 dictates that a plea of no contest entered in a criminal case “is not admissible in any civil or criminal proceeding against the defendant who made the plea.” Because both a plea of guilty to a criminal offense and a conviction following trial are generally admissible as evidence in future civil lawsuits that may be brought against the defendant, while a plea of no contest is not admissible in such cases, one purpose of the no-contest plea option is to conserve judicial resources by enabling criminal defendants with concerns about future civil liability to forego a trial without admitting guilt.
In this case J. Patrick O’Flaherty’s, a restaurant in Fremont co-owned by Richard and Jan Heyman, was heavily damaged by a fire on the evening of Feb. 4, 2001. Based on evidence obtained through an investigation by the State Fire Marshal’s office and other sources, a Sandusky County grand jury indicted Richard Heyman in December 2001 on charges of arson, aggravated arson and insurance fraud for allegedly setting the fire and disabling the building’s sprinkler system. Following extensive pretrial proceedings, in May 2004 Richard entered no contest pleas to one count of arson and one count of insurance fraud. He was convicted and sentenced to one year in prison and five years of community control.
The Heymans subsequently filed a claim against a fire and casualty insurance policy they had purchased in the name of the restaurant from the Elevators Mutual Insurance Company. The insurer rejected the claim, citing a policy exclusion for loss or damage caused by “any dishonest or criminal act” by the policyholder or any of the policyholder’s “partners, employees ... or directors.” Elevators Mutual also filed suit in the Sandusky County Court of Common Pleas seeking a declaratory judgment that it had no obligation to make any payment under its policy to J. Patrick O’Flaherty’s or to Richard or Jan Heyman as the loss payees listed in the policy. The restaurant and the Heymans filed a counter-claim seeking damages from Elevators Mutual and its liability insurer, NAMIC Insurance Company, alleging that Elevators Mutual had acted in bad faith in refusing to honor their claim.
During pretrial proceedings in the declaratory judgment case, Elevators Mutual filed a motion seeking the court’s approval to include in its pleadings and trial argument evidence of Richard’s criminal conviction for arson in connection with the fire that was the basis of the Heyman’s insurance claim.
The trial court granted that motion, holding that Evidence Rule 410 precluded admission of evidence regarding Richard’s plea of no contest, but did not bar evidence of his conviction based on that plea.
Following that ruling, the trial court granted summary judgment in favor of the insurance company, holding that admission of evidence of Richard’s arson conviction eliminated any legal argument the Heymans’ could advance that their losses were not excluded from coverage by the policy exclusion for an “illegal act” of an insured.
The Heymans appealed the summary judgment order. In a 2-1 decision, the 6th District Court of Appeals reversed and remanded the case to the trial court for further proceedings. The appellate majority ruled that the trial judge acted contrary to Criminal Rule 11(B)(2) and Evidence Rule 410 by admitting evidence of Richard’s conviction based on a no contest plea in a subsequent civil lawsuit. The insurance companies sought and were granted Supreme Court review of the 6th District’s ruling.
Attorneys for Elevators Mutual argue that the plain language of the evidence and procedural rules at issue in this case preclude only the admission of evidence of a defendant’s prior plea of no contest, and therefore do not bar evidence of his conviction. They cite the Supreme Court of Ohio’s 1985 decision in State v. Mapes, which held that the rules in question in this case did not bar admission of evidence in a later proceeding of a defendant’s prior conviction after a no-contest plea when the fact of that conviction was material to a statutory finding that he was a repeat offender and therefore subject to more severe sentencing guidelines. Similar to Mapes, they assert, the fact that Richard Heyman was convicted of arson for starting the fire that damaged his restaurant must be admissible in this case because it is an essential element of the insurance company’s denial of coverage based on the policy exclusion for losses caused by a policyholder’s own “criminal act.”
Attorneys for the Heymans urge the Court to affirm the 6th District’s holding that the trial court drew a “false distinction” between admitting evidence of a no contest plea and admitting evidence of the conviction that routinely follows such a plea. They assert that the public policy underlying the evidence and procedure rules barring use of a no-contest plea in a subsequent civil suit is to encourage criminal defendants to save the state the time and expense of a trial in cases where the defendant’s primary concern is that evidence of a guilty plea or conviction after trial will “automatically” establish his liability for damages in a subsequent civil lawsuit against him. They argue that the trial court’s ruling allowing evidence of Richard’s conviction following a no-contest plea in a subsequent civil action defeats the primary purpose of Criminal Rule 11(B)(2) and Evidence Rule 410, and contend that reversal of the 6th District’s ruling in this case will eliminate a crucial incentive for defendants to forego a trial and enter no-contest pleas in future criminal cases.
Contacts
Robert E. Chudakoff, 216.583.7000, for Elevators Mutual Insurance Co.
W. Patrick Murray, 419.624.3000, for J. Patrick O’Flaherty’s and Richard and Jan Heyman.
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