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Wednesday, April 9, 2014

Cedar Fair, L.P. v. Jacob Falfas, Case no. 2013-0890
Sixth District Court of Appeals (Erie County)

Visiting Nurse Association of Mid-Ohio, et al. v. Tamara L. Friebel, Case no. 2013-0892
Fifth District Court of Appeals (Richland County)

State of Ohio v. James Tate II, Case no. 2013-0910
Eighth District Court of Appeals (Cuyahoga County)

May Court Reinstate Discharged Employee Regardless of Employment Contract’s Terms?

Cedar Fair, L.P. v. Jacob Falfas, Case no. 2013-0890
Sixth District Court of Appeals (Erie County)

ISSUE: Does Ohio case law barring specific performance as a remedy for breach of a personal services contract apply generally to all employment agreements?

In July 2007, Jacob Falfas signed a three-year contract to become the chief operating officer of Cedar Fair, a publicly traded company that owns amusement parks, water parks, and hotels and is headquartered in Sandusky. Falfas worked for Cedar Fair until June 2010, when Falfas had a brief telephone conversation with the company’s chief executive officer that resulted in the end of his employment. The facts of the conversation were disputed, with Cedar Fair stating that Falfas had resigned and Falfas arguing that he was fired.

Falfas, following the procedure agreed to in his employment contract, requested that the dispute be submitted to final and binding arbitration (an alternative to asking a court to settle a dispute, where the parties agree to a person or panel reviewing the facts and imposing a legally binding decision).

The arbitration was conducted by a panel of three attorneys, and the panel ruled in Falfas’s favor, finding that Falfas had been terminated without cause. Instead of implementing the contractually agreed-to provisions for termination without cause, the panel ordered Cedar Fair to specifically “perform” the employment contract by reinstating Falfas as COO and giving him back pay for the salary and benefits denied to him as a result of his termination.

Cedar Fair challenged this result by asking a common pleas court to vacate or modify the decision, asserting that the arbitrators had exceeded their powers under the employment contract. Cedar Fair argued that even if the employment contract had not listed a precise remedy, the arbitrators still exceeded their power because Section 19 of the contract only allowed them to order relief that an Ohio court could provide in the same situation.

The trial court found in favor of Cedar Fair, holding that under Ohio law, a court could not require a company to reinstate a discharged employee as a remedy unless an applicable statute specifically allowed for reinstatement. Since the court did not find any applicable statutes with such a provision, it ruled that Ohio courts would not have been able to force Cedar Fair to rehire Falfas, and therefore the arbitrators exceeded their power by requiring Cedar Fair to reinstate Falfas.

Falfas appealed to the Sixth District Court of Appeals, arguing that the trial court erred when it modified the arbitrators’ remedy. The Sixth District agreed with Falfas, finding that Ohio law would permit a court to order Falfas’s reinstatement, so the arbitrators’ award did not exceed their power and should be upheld.

Cedar Fair appealed to the Ohio Supreme Court, which agreed to hear the case.

Attorneys for Cedar Fair argue that Ohio law has long held that courts cannot order specific performance of an employment contract, which they maintain is a widely held common-law principle enforced in a majority of states. Citing the Ohio Supreme Court decision in Masetta v. National Bronze and Aluminum Foundry Company (1953), Cedar Fair’s attorneys assert it has long been recognized that a court will not obligate a company to rehire an employee as a remedy for wrongful termination.

They contend that the Sixth District was wrong to limit the holding in Masetta to class actions involving collective bargaining agreements. Cedar Fair’s attorneys assert that if courts were allowed to force companies to rehire wrongfully terminated employees, several problems would arise, which is why Ohio law has always barred specific performance as a remedy for breach of personal services contracts unless an applicable statute provides otherwise.

Attorneys for Cedar Fair maintain that under the principle of fairness, courts will not recognize specific performance as a remedy for wrongful termination. Since the Thirteenth Amendment prohibits involuntary servitude, specific performance is not available as a remedy to employers when workers violate the terms of their employment contract, so there is no “mutuality of remedies,” they argue.

In addition, they contend that if courts were allowed to order specific performance of employment contracts, it would force a relationship on the parties that would not be beneficial for anyone. Cedar Fair’s attorneys argue that courts have found that forcing the parties to continue a relationship that ended on bad terms is not an equitable remedy. They also assert that courts have been reluctant to allow specific performance of employment contracts because this remedy is difficult to enforce and monitor because the court or arbitration panel must stay involved to ensure a party’s performance is sufficient.

Therefore, the Sixth District misread Masetta when it limited the holding to class actions involving collective bargaining agreements, and the arbitrators’ requirement that Cedar Fair rehire Falfas should not have been reinstated, they conclude.

Falfas’s attorneys counter that Cedar Fair’s reading of Masetta is incorrect because the decision allows for exceptions. The language in Masetta never explicitly bars specific performance as a remedy for all employment contracts, they assert.

Citing the Tenth District Court of Appeals’s decision in Ohio Dominican College v. Krone (1992), attorneys for Falfas’s argue that the Sixth District is not the only court to find that Masetta was limited in scope. They assert that because the Tenth District made no mention of the Masetta decision in Krone, it implicitly acknowledged that Masetta was limited to class actions and did not apply to employment agreements generally.

Falfas’s attorneys also maintain that the complete barring of specific performance as a remedy is not a general common-law principle enforced in the majority of states, contrary to the position of Cedar Fair. They argue that many courts around the country have ordered reinstatement of employees who have been wrongfully terminated.

Finally, Falfas’s attorneys claim that even if the Sixth District misread Masetta, the arbitration award cannot be vacated because the trial court found no evidence of fraud, misconduct, or other irregularity in the arbitration panel’s decision to require Cedar Fair to reinstate Falfas. Policy regarding arbitration awards favors the arbitrators’ decision because arbitration was established to resolve disputes expediently, without court intervention, they argue.

Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.

Representing Cedar Fair, L.P.: Douglas Cole, 614.481.0904

Representing Jacob Falfas: Richard Panza, 440.695.8000

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Is Dual Intent an Appropriate Legal Analysis in Workers’ Compensation Claim?

Visiting Nurse Association of Mid-Ohio, et al. v. Tamara L. Friebel, Case no. 2013-0892
Fifth District Court of Appeals (Richland County)


Tamara Friebel, a licensed practical nurse, worked for Visiting Nurse Association of Mid-Ohio (VNA) providing in-home health care to VNA’s clients. She used her personal vehicle to travel from her residence in Shelby to each patient’s house. On weekends, VNA paid Friebel for travel time and mileage from the time she left her home.

One Saturday in January 2011, Friebel planned to drop off her two children and two friends at the Richland Mall on the way to her first patient appointment in Ontario. While stopped at a traffic light near the mall, someone rear-ended her car.

Friebel sprained her neck in the accident and filed a workers’ compensation claim for the injury. (VNA disputes whether an injury occurred.)

The Bureau of Workers’ Compensation allowed the claim, and after two hearings on appeal the Industrial Commission agreed. Freibel’s employer then appealed to the Richland County Court of Common Pleas, which found in favor of VNA in a summary judgment (a decision without a trial) and determined that Friebel was injured while on a personal errand, not acting within her employment.

Friebel appealed to the Fifth District Court of Appeals, which reversed the trial court. The appeals court determined that Friebel was engaged in acts her employer required her to do for her job and her injury occurred while she was in the course of her employment. The court granted summary judgment to Friebel.

The VNA filed an appeal with the Ohio Supreme Court, which agreed to hear the case.

Attorneys for VNA maintain that in this case the Fifth District has created a “dual intent” doctrine in Ohio workers’ compensation law, and this doctrine has been rejected by the Ohio Supreme Court in cases such as Cardwell v. Indus. Comm. (1951). The attorneys argue that there can be no “causal relationship” between Friebel’s employment and her injuries until after her personal errand was completed.

Instead, the attorneys assert that Friebel’s claim should be reviewed using well-established tests in workers’ compensation cases. First, they contend that Friebel was not “in the course of” her employment at the time of the accident because she was taking her kids and their friends to the mall – an activity that was not required by her job.

Second, they argue that she never began work that day or entered the scope of her employment. The accident was on a public road miles from her first patient’s house, VNA had no control of the accident scene, and the company received no benefit from her presence at the scene of the accident. As a result, her injury did not “arise out of” her employment with VNA.

They also claim that the Fifth District wrongly construed the facts of the case in favor of Friebel, the non-moving claimant, and improperly granted her summary judgment.

Attorneys for Friebel counter that no new legal doctrine was created by the Fifth District’s decision. Instead, “[t]he Fifth District simply observed that Plaintiff possessed ‘dual intentions when she left her home[,]’ which is an undisputed fact,” they wrote in their brief to the court. “Far from establishing any novel new legal standards, the majority observed that: ‘Simply because [Plaintiff] dually intended to both travel to her patient’s home and drop her passengers off at the mall when she left her house does not disqualify [her] from being in the course of employment since the accident occurred prior to [her] deviation from the route to the patient’s house.’ … The only issue to be resolved is whether a compensable injury or occupational disease was sustained in the course of and arising out of the scope of employment.”

They argue that Friebel was on a path to her work assignment that day, and because she can establish “sufficient causal connection” to her work responsibilities, she is entitled to workers’ compensation benefits.

In addition, the attorneys assert that VNA asked the trial court for summary judgment, contending that the facts were undisputed. Friebel’s attorneys maintain that VNA does not now have a right to dispute the facts and argue that summary judgment for Friebel by the appeals court was improper because the ruling was not in its favor.

The Ohio Bureau of Workers’ Compensation (BWC) is also a party in the case. The state agency requested to be aligned with VNA, not because the agency is taking a position on the outcome of the dispute but because it agrees with VNA’s interpretation that the Fifth District’s decision created a “dual intent” doctrine. That doctrine is an improper legal approach and one that is inconsistent with settled workers’ compensation law, the agency attorneys assert.

“The BWC does not ask the Court to make new law, but simply to re-affirm established law and to reject the novel ‘dual intent’ approach that the appeals court used,” the agency’s brief to the court states. “The Court’s existing case law is enough to resolve cases such as this, and consideration of ‘intent’ at all – let alone ‘dual intent’ – sows confusion. The ‘dual intent’ approach would confuse existing doctrine and thus decrease predictability in the workers’ compensation system. That would be bad for the BWC, for the litigants, and for the courts.”

The agency’s attorneys ask the court to send the case back to the trial court for consideration without the dual-intent framework but instead consistent with established statutory and case law.

Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.

Representing Visiting Nurse Association of Mid-Ohio: Timothy Marcovy, 216.241.7740

Representing Tamara Friebel: Paul Flowers, 216.344.9393

Representing the Bureau of Workers’ Compensation: Eric Murphy, 614.466.8980

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When Is In-Court Identification of Alleged Perpetrator Required?

State of Ohio v. James Tate II, Case no. 2013-0910
Eighth District Court of Appeals (Cuyahoga County)

ISSUE: Is in-court identification by victim and witnesses of a person charged with a crime required for a conviction?
On February 12, 2011, a 14-year-old girl, identified as B.P., went to the Euclid Public Library with two friends. After her friends entered the library, a man approached B.P., gave her a business card, and told her about a study group meeting by some nearby tennis courts. B.P. walked with the man, who talked to her about his business selling Internet plans. They went to the entrance of a nearby pool, and B.P. said the man asked her to perform a sexual act. B.P.’s phone buzzed, and she told the man her mother was back at the library. They both returned to the library where B.P. found her friends. After hearing what had transpired, her friends encouraged B.P. to go to the police.  

The girls made a report at the Euclid police station, and an officer who had been stationed outside the library went to the library to look for the man. The officer had police dispatch call the phone number on the business card, and James Tate II answered his cell. The officer confirmed that the incoming call on Tate’s phone was from police dispatch, and Tate was arrested.

Tate was found guilty of kidnapping, importuning, gross sexual imposition, and public indecency, and the court sentenced him to seven years in prison.

Tate appealed his convictions and sentence to the Eighth District Court of Appeals, which reversed the trial court and overturned Tate’s conviction. The appellate court noted that neither the victim nor her friends identified or were asked to identify Tate as the perpetrator in their testimony during trial. The Eighth District concluded that there was not sufficient evidence that Tate was the man they referred to in their testimony.

The state appealed the decision to the Ohio Supreme Court, which agreed to hear the case.

Attorneys from the Cuyahoga County Prosecutor’s Office argue that the Eighth District has ignored its own decision in State v. Melton (2006), which stated that the lack of in-court identification “‘is not fatal to the state’s case when the circumstances of the trial indicate the accused is indeed the person about whom the witnesses are testifying.’”

They assert that Tate was the person about whom B.P. and her friends testified, as shown clearly and convincingly by evidence such as: library security video showing Tate interacting with B.P. outside the library around the time of the offense; B.P.’s testimony that the business card with Tate’s name and cell phone number were given to her by the man in the video; a video confession by Tate, admitted into evidence at trial, that he had been outside with B.P. at the library and had asked B.P. to perform a sex act; Tate’s testimony at trial that he walked with B.P. away from the library to the pool area and sexually propositioned her.

The attorneys contend that the appeals court “placed undue emphasis” on an in-court identification and did not address all of the other evidence pointing to Tate as the perpetrator.

In addition, they claim that Tate cannot raise in-court identification as an issue on appeal now because he did not raise it during his trial.

Attorneys for Tate maintain that Tate testified he had no sexual contact with B.P. Tate’s attorneys also contend that the state’s argument that in-court identification of an accused is not required for a conviction if there is enough other evidence is accurate, and that is the law that the appeals court followed in its decision.

“The [state] simply is not happy about the court’s application of the facts to the law,” Tate’s attorneys assert in their brief to the court. “Historically, this Court has routinely refused to participate in this type of error correction. Based on this, Mr. Tate prays that this Honorable Court overrules … the government’s appeal or prays that this Court dismisses the appeal as improvidently granted.”

However, if the Supreme Court agrees with the state, Tate’s attorneys contend that the court should direct the appellate court to fully consider all the arguments that were raised in Tate’s appeal.

Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.

Representing the state of Ohio from the Cuyahoga County Prosecutor’s Office: James Price, 216.443.2070

Representing James Tate II: Paul Kuzmins, 216.443.3677

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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.