Illinois Supreme Court Rejects Plaintiff’s Fishy Basis for General Jurisdiction, Mandating that Out-of-State Corporation Be “Essentially at Home” Pursuant to Daimler

On September 21, 2017, in Aspen American Insurance Co. v. Interstate Warehousing, Inc., No. 121281 (Illinois, September 21, 2016), the Illinois Supreme Court held that an out-of-state corporation must be “essentially at home” in Illinois before general jurisdiction may be found, rejecting plaintiff’s argument that the presence of a single warehouse in the state meets this standard.  In a straightforward interpretation of Daimler AG v. Bauman, et al., 134 S.Ct. 746 (2014), the court confirmed that general jurisdiction requires “continuous and systematic” contacts with Illinois, which can be met by showing that a defendant is either incorporated in Illinois or has its principal place of business there.  The Illinois Supreme Court’s ruling follows on the heels of two recent U.S. Supreme Court Decisions, both of which confirm that Daimler meant what it said about the limits of general jurisdiction, and Illinois now joins other states – such as Delaware, Missouri, and Rhode Island – which have rendered similar rulings.

Aspen  arose after Eastern Fish Company, a corporation in the business of importing fish products, contracted with defendant Interstate Warehousing Inc. to store its products at one of defendant’s warehouses located in Michigan.  When the warehouse’s roof collapsed, the importer’s products were contaminated and deemed unfit for human consumption.  Plaintiff, which insures Eastern, paid Eastern’s claim for the loss and then brought this subrogation action in the circuit court of Cook County.  ¶ 3.

Defendant moved to dismiss the complaint on the ground that Illinois courts lacked personal jurisdiction.  ¶ 6.  In response, Plaintiff first argued that because the dcfendant has a warehouse located in Joliet, Illinois, it was doing business in the state and thus subject to personal jurisdiction.  Plaintiff further argued that because defendant Interstate was registered to do business in Illinois, it could be sued in Illinois.  ¶ 8.  The circuit court denied the motion to dismiss and the Appellate Court for the First District affirmed, finding that Plaintiff had made a prima facie showing of general jurisdiction.  Illinois’ highest court reversed the lower courts’ decisions.

The Illinois Supreme Court first examined the federal due process standards set forth in Daimler, as well as Illinois’ long-arm statute, codified at 735 ILCS 5/2-209 , which governs the exercise of personal jurisdiction over non-resident defendants.  In doing so, the court followed in Daimler’s footsteps by finding that a “plaintiff must make a prima facie showing that defendant is essentially at home in Illinois.”  ¶ 18.  In order to do so, a plaintiff must show that the “defendant is incorporated or has its principal place of business in Illinois or that defendant’s contacts with Illinois are so substantial as to render this an exceptional case.”  Id.

Although the defendant does business through its Joliet warehouse, the court found that it was insufficient to establish Illinois as a  “surrogate home,” even though the evidence established that the warehouse had been in continuous use in Illinois for 25 years.  ¶ 19.  If it were sufficient, the court reasoned, then that the defendant would be considered at home in every state in which it has a warehouse, opening up numerous forums for it to be sued within.  Id.  The U.S. Supreme court had previously rejected this idea in Daimler, holding that “[a] corporation that operates in many places can scarcely be deemed at home in all of them.”  Daimler AG v. Bauman, 134 S. Ct. 746, 762 n. 20 (2014). Aspen followed suit and held that general jurisdiction was not authorized under Illinois’ long-arm statute as it would deny defendant due process of law.  ¶ 20.

The Illinois Supreme Court next looked to the Business Corporation Act of 1983 (“Act”) to see if it permitted general jurisdiction.  Upon examination, the court found that Defendant’s registration to do business within Illinois under the Act is not enough to subject it to personal jurisdiction within the state.  The court further found that the fact that the defendant has a registered agent in Illinois for service of process is also not enough to subject it to personal jurisdiction.  ¶ 22.  The court reasoned that the Act does not require out of state corporations to consent to general jurisdiction as a condition of doing business in Illinois and that a corporation does not waive its due process rights by registering in Illinois or appointing a registered agent.  ¶ 24.  For these reasons, the court held that general jurisdiction is also not permitted under the Business Corporation Act of 1983.

Illinois now joins other states which have made clear that they will apply the Daimler court’s test for personal jurisdiction, requiring that a defendant’s “affiliations with the forum state be so ‘continuous and systematic’ as to render them essentially at home.” Under Daimler, this can be accomplished by a showing defendant’s incorporation in that state or by showing that the defendant’s principal place of business is located there.  Daimler AG v. Bauman, 134 S. Ct. 746, 754 (2014) (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)).”    Accordingly, Aspen provides Illinois defendants a powerful new tool to fight forum shopping, and to ensure Constitutional due process to litigants in Illinois courts.

 

 

A More Personal Touch: Challenge to Madison County Jurisdiction Ordered Forward

6-7On May 25, 2016, the Illinois Supreme Court ordered the Fifth District Appellate Court of Illinois to hear Ford Motor Company’s appeal on a motion to dismiss for lack of personal jurisdiction, which had been denied by Honorable Judge Stephen A. Stobbs, the presiding asbestos judge in Madison County. Because Madison County has long been a magnet for out-of-state plaintiffs, this appeal could have widespread ramifications for out-of-state corporations, particularly those involved in mass-tort litigation. A ruling in favor of Ford would significantly impede plaintiffs’ ability to forum shop in plaintiff-friendly jurisdictions such as Madison County.

In Jeffs v. Anco Insulations, Inc., plaintiff alleges that the decedent was exposed to asbestos-containing products through his work as a union insulator at various sites. Decedent worked at the Ford plant in Michigan for six weeks in the 1970’s, but was not exposed to any Ford product or facility in Illinois.

In June 2015, Ford moved to dismiss for lack of personal jurisdiction. Ford relied primarily on the United States Supreme Court’s ruling in Daimler AG v. Bauman, which established that a court may assert jurisdiction over a foreign corporation “only when the corporation’s affiliations with the State in which suit is brought are so constant and pervasive as to render [it] essentially ‘at home’ in that forum State.” (This is an issue that we have blogged about before – California Court rules no jurisdiction over foreign parent corporations; No in state dealings for years – no jurisdictionOut of state defendant? Out of state exposure? File suit somewhere else; and Registered in Delaware Is Not At “Home” There.) Under the Daimler analysis, a corporation is generally “at home” only at its place of incorporation or principal place of business. Because Ford’s state of incorporation is Delaware and its principal place of business is in Michigan, Ford argued that the court could not impose jurisdiction.

In November 2015, Judge Stobbs denied Ford’s motion. Despite the standard articulated in Daimler, Judge Stobbs ruled that Ford is subject to jurisdiction in Illinois due to its substantial contacts with the state. Judge Stobbs noted that Ford conducts business in Illinois, owns real property in Illinois, has employees in Illinois, and has acquiesced to jurisdiction in Illinois in previous suits. Judge Stobbs further found that Ford provided “unequivocal consent to jurisdiction in Illinois” by virtue of its Illinois business license and appointment of a registered agent to accept process. To further bolster his decision, Stobbs relied on Ford’s recently filed brief in a separate case, Folta v. Ferro Engineering, in which Ford explicitly acknowledged its significant operations and monetary investments in Illinois.

After Judge Stobbs issued his ruling, Ford sought leave to appeal the decision. On February 10, 2016, a three member panel of the Fifth District denied Ford’s petition. Undeterred, Ford filed a motion for a supervisory order with the Illinois Supreme Court, which the court granted. A supervisory order is granted only in limited circumstances when the lower court acted in excess of its authority or abused its discretionary authority. As such, the granting of this supervisory order suggests that the Illinois Supreme Court finds Ford’s position meritorious.

A ruling in favor of Ford would undoubtedly be followed by an onslaught of personal jurisdiction motions, particularly for those out-of-state defendants caught in the web of Madison County asbestos litigation. Most of the active defendants have little or no connection with Illinois, and many cases involve non-Illinois exposures. In the interim, it remains to be seen whether Judge Stobbs will entertain any additional personal jurisdiction motions or simply stay them pending a ruling from the Fifth District Appellate Court.

Illinois Federal Court Holds Asbestos Product Manufacturer Owes no “Take Home” Duty of Care

The Northern District of Illinois recently ruled that under Illinois law, an asbestos product manufacturer owed no duty of care to household members in a “take home” or “secondary exposure” asbestos case. Neumann v. Borg-Warner Morse Tec LLC, No. 15-10507, N.D. Ill., 2016 U.S. Dist. LEXIS 31280.

Plaintiff Doris Jane Neumann alleges that she contracted malignant mesothelioma through exposure to asbestos-containing products as a result of laundering the clothes of her son, who used asbestos-containing friction paper during his work as a mechanic. Originally filed in state court, the case was removed to federal court on diversity grounds. Subsequently, defendant MW Custom Papers moved for dismissal under Federal Rule of Civil Procedure 12(b)(6), alleging that it could not be found liable for negligence because it did not owe Doris Jane Neumann a duty of care under Illinois law.

In ruling on the motion, the federal district court noted with frustration that there was a split of opinion among Illinois appellate courts on the issue. The Illinois Supreme Court had the opportunity to decide the issue in Simpkins v. CSX Transp., Inc., 2012 Ill. LEXIS 330, 965 N.E.2d 1092 (2012), but declined to issue a definitive ruling. Thus, the Illinois Supreme Court never actually answered the question as to whether a “take home” duty of care existed in Illinois asbestos cases. As a result, the holding in Neumann takes on a heightened significance.

Neumann analyzed the following four factors set forth in Simpkins: (1) the reasonable foreseeability of the injury; (2) the likelihood of the injury; (3) the magnitude of the burden of guarding against the injury; and (4) the consequences of placing that burden upon the defendant. At the outset, the court determined that the foreseeability factor was sufficiently met under the liberal notice pleading standard used in federal court. Moreover, MW Custom Papers did not challenge the “likelihood of injury” factor. Importantly, the court emphasized that plaintiff completely failed to address the third and fourth policy-driven factors in her briefs and exclusively focused her arguments on the foreseeability factor, which “is not the only factor to be considered.” Although the court found “no precedents or other authorities that convince us how the Illinois Supreme Court would rule on this novel duty question,” it found two Illinois appellate decisions that addressed this issue, but came to opposite results. Lastly, the court looked toward outside jurisdictions for direction, where it once again found divided opinions throughout the country. “While the majority of courts have declined to extend a duty in this situation, that fact alone is not persuasive, particularly because duty and negligence principles vary among states.”

Neumann gleaned some guidance from the Seventh Circuit, which instructed that “[w]hen we are faced with two opposing and equally plausible interpretations of state law, we generally choose the narrower interpretation which restricts liability, rather than the more expansive interpretation which creates substantially more liability.” Applying this reasoning, the court adopted the more narrow view, finding that MW Custom Papers did not owe a duty to Neumann in light of the magnitude of the burden of protecting her and the potential ramifications of imposing that heavy a burden on MW Custom Papers.

Barred: Illinois Supreme Court Holds That Plaintiffs May Not File Common Law Claims Against Employers, Even After Statutory Periods Have Expired

11-18On November 4, 2015, the Supreme Court of Illinois issued an opinion in Folta v. Ferro Engineering, 2015 IL 118070, which provided much needed clarification to the application of the “exclusive remedy” provisions of the Illinois Workers’ Compensation Act and Occupational Diseases Act in the context of long-latency asbestos-related diseases. Before Folta, several courts have ruled that employees were allowed to file civil lawsuits against their employer, if the 25-year statute of repose for workers’ compensation claims had expired. Folta went the opposite way, reinforcing the longstanding rule that an employee’s exclusive remedy for damages sustained in the course of employment is through the Illinois Workers’ Compensation Commission, regardless of whether any statutory time periods for workers’ compensation claims have expired.

Decedent James Folta worked for Ferro Engineering from 1966-1970 as a direct employee. Forty-one years later, in May 2011, Folta was diagnosed with mesothelioma. He thereafter filed a civil lawsuit in Cook County, Illinois against various defendants, including his former employer, Ferro Engineering, to recover damages. Defendant Ferro Engineering filed a motion to dismiss, alleging that Folta’s claims were barred by the exclusivity provision of the Illinois Workers’ Compensation Act (820 ILCS 305/5) and the Occupational Diseases Act (820 ILCS 310/5). In response, Folta argued that his symptoms did not manifest until 40 years after his last exposure to asbestos from Ferro Engineering and, accordingly, he was unable to file a workers’ compensation claim due to expiration of the 25-year statute of repose included in the Acts. Folta further argued that since the statute of repose had expired, his claims were “non-compensable,” which is one of four exceptions to the exclusivity mandate contained in the Acts.

The trial court granted Ferro Engineering’s motion to dismiss, finding that the action was indeed barred by the exclusivity provision of the Acts. Specifically, the trial court found that expiration of the applicable statute of repose period did not render the cause of action “non-compensable” under the Acts and that his exclusive remedy was still with the Illinois Workers’ Compensation Commission. Folta appealed the lower court’s decision and the appellate court reversed and remanded. The appellate court found that Folta’s injury was not compensable under the Act, because his disease did not manifest until after the statute of repose expired and he had no opportunity to seek compensation under the Acts. Therefore, the court reasoned, that the workers’ compensation exclusivity provision did not bar his suit against his former employer.

The Illinois Supreme Court reversed, ruling that the exclusivity provisions of the Illinois Workers’ Compensation Act and the Illinois Occupational Diseases Act bar an employee’s cause of action against an employer to recover damages for a disease resulting from asbestos exposure which arose out of and in the course of employment even though no compensation is available under those Acts due to statutory time limits on the employer’s liability.

Both the Workers’ Compensation Act and the Occupational Diseases Act provide that compensation provided therein for workplace injuries represent the full and complete remedy to an employee and no other remedy under common law or statutory law is available. 820 ILCS 310/5(a) and 820 ILCS 310/11. As with every rule, however, there are exceptions. Illinois courts have carved out four scenarios in which the exclusivity provisions of the Acts do not apply: (1) the injury was not accidental; (2) the injury did not arise from the employee’s employment; (3) the injury was not received during the course of employment; and (4) the injury is not compensable under the Acts. For the purposes of this analysis, the only relevant exception is the “noncompensability” exception, which is further outlined below.

The Folta decision reviewed a plethora of cases that specifically addressed the compensability of certain injuries under the Acts. In particular, the decision honed in on three cases wherein the plaintiffs sought to recover for injuries such as severe emotional shock and emotional distress that were incurred during employment. Pathfinder Co. v. Industrial Comm’n, 62 Ill.2d 556 (1976); Collier v. Wagner Castings Co., 81 Ill. 2d 229, 237 (1980); Meerbrey v. Marshall Field & Co., 139 Ill.2d 455 (1990). Folta ruled that these three cases stood for the proposition that whether an injury is compensable is related to whether the type of injury categorically fits within the purview of the Act. Contrarily, they do not stand for the proposition that whether an injury is compensable is defined by an ability to actually recover benefits for a particular injury sustained by an employee. Asbestos-related injuries, such as asbestosis or mesothelioma, fall within the purview of the Acts and are specifically addressed by each Act, and are, therefore, compensable.

Folta then ruled that such claims remain compensable despite the expiration of a limitations period on the employer’s liability. The court relied heavily upon Moushon v. National Garages, Inc., 9 Ill. 2d 407 (1956) and Duley v. Caterpillar Tractor Co., 44 Ill. 2d. 15 (1969) in analyzing the efficacy of the exclusivity provisions of the Acts in cases where little or no compensation was received. In Moushon, a workplace accident caused the employee to become permanently impotent. The employer provided medical, surgical, and hospital services for the underlying injury; however, the plaintiff thereafter filed a civil action seeking damages for his impotence that resulted from the workplace accident. Despite the fact that no compensation was available specifically for the injury of impotence, the court held that his claims were barred by the exclusivity provision of the Acts. Mouson, 9 Ill. 2d at 418. Likewise, in Duley, the spouse of a deceased employee who was fatally injured in a workplace accident brought a civil lawsuit against the employer for wrongful death. Although the spouse received nominal reimbursement for funeral expenses, the court found that plaintiff’s wrongful death claims were barred by the exclusivity provisions of the Acts because he was not a dependent of his deceased wife. Duley, 44 Ill. 2d. at 18.

The Illinois Supreme Court agreed that Folta’s injuries are indeed barred by the 25-year statute of repose contained in each of the Acts. This did not, however, mean that exclusivity disappeared over time. “To construe the scope of the exclusive remedy provision to allow for a common-law action under these circumstances would mean that the statute of repose would cease to serve its intended function, to extinguish the employer’s liability for a work-related injury at some definite time.”

The Folta decision is significant for Illinois based employer-defendants in cases involving diseases with long latency periods, such as mesothelioma. It is also significant to insurers. The Illinois Supreme Court has made it clear: the Workers’ Compensation Act and Occupational Diseases Act are the full relief afforded to employees for injuries sustained in the course of employment, to the exclusion of any civil litigation, regardless of an expired statutory time period or whether an employee actually recovers compensation.

“Proximate Cause” to Celebrate: Evidence of Exposure to Asbestos from Source Other Than Defendant Again Required in Illinois

On July 30, 2015, an Illinois appeals panel held that a trial court committed reversible error by excluding evidence of a plaintiff’s prior work history, which the defendant sought to present as part of its “sole proximate cause defense.” The “sole proximate cause defense,” in which a defendant claims that a plaintiff’s injury resulted wholly from the conduct of some other party, was clarified for Illinois asbestos litigation in Nolan v. Weil-McLain. There, the Illinois Supreme Court held that evidence of the negligence of nonparty tortfeasors is admissible where a defendant claims the negligence of those nonparties was the sole proximate cause of the plaintiff’s injury. Prior to Nolan, Illinois courts had consistently barred evidence of exposures other than to the product (or at the premises) of the litigating defendant.

In Smith v. Illinois Central, Plaintiff Jim Smith filed suit against several defendants alleging exposure to asbestos while employed by GM&O Railroad (predecessor of Illinois Central Railroad Co.), leading him to contract asbestosis. Defendant Illinois Central Railroad Co. was the only remaining defendant at trial, and sought to introduce evidence that Plaintiff had worked at a Union Asbestos & Rubber Company (UNARCO) facility where he was exposed to asbestos. Plaintiff filed a motion in limine to bar the defendant from introducing any evidence that he was exposed to asbestos dust in any manner other than by virtue of his employment by that defendant. The trial judge granted the motion, and after a three week trial, the jury returned a verdict in plaintiff’s favor.

On appeal, Illinois Central argued that excluding evidence of plaintiff’s significant exposure to asbestos while working at UNARCO in effect stripped Illinois Central of its sole proximate cause defense, because the jury could have reasonably found that the single proximate cause of plaintiff’s condition was the massive dose of asbestos exposure he sustained while working at UNARCO, as opposed to the minimal dose he may have received while employed by the railroad. The Appellate Court of Illinois agreed, reversing and remanding the case for a new trial, and holding that excluding evidence of other exposures improperly deprived the defendant of a rational alternative explanation for why plaintiff was suffering from an asbestos-related disease.

The appellate panel explained that a defendant is permitted to challenge both medical causation and the allegation that the exposure in question led to the alleged disease. Thus, Illinois Central should have been allowed to present evidence in an attempt to establish that plaintiff’s UNARCO work experience was to blame for his asbestosis. The trial court’s error was “particularly egregious” in this case, the court explained, because a large portion of plaintiff’s case was based on his exposure to dust from UNARCO’s operation while working for the railroad.

The Smith opinion illustrates the practical application of Nolan, and demonstrates that Illinois courts are no longer blocking defendants from pointing to other potential proximate causes of asbestos-related disease. Where an asbestos plaintiff had minimal exposure to a defendant’s product but significant exposure to the asbestos of non-parties, and perhaps in other cases as well, Illinois defendants are armed with the right to present the highly relevant evidence of exposure from another source.

Multiple trial courts toss out “single fiber” causation theory under both Federal and state law

Since the first asbestos filing by a plaintiff’s lawyer, plaintiff medical experts in mesothelioma cases have infamously opined that every exposure to asbestos by a plaintiff – including exposure to a single asbestos fiber – is sufficient to cause disease. Not only does this type of expert testimony ease the connecting of the causation dots, but it permits the recycling of generalized and “boilerplate” expert reports. Recently, however, court rulings have given hope to defendants in the litigation that plaintiffs may now have to put considerably more time and effort into developing their expert opinions by precluding those experts from advancing the “single fiber” theory.

In January 2013, asbestos-fibresthe District Court of Utah rejected plaintiff’s attempt to use “single fiber” expert testimony. Smith v. Ford Motor Co., D. Utah, No. 2:08-cv-630, 1/18/13. In Smith, Ford moved to dismiss the “single fiber” testimony of plaintiff’s medical expert, arguing that the theory was speculative and without scientific foundation. As a result, it was inadmissible under Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharmaceuticals Inc., 509 U.S. 579 (1993). The district court agreed and found that the pathologist’s opinion was wholly “unsupported by sufficient or reliable scientific research, data, investigations or studies.” The court elaborated that this testimony did “virtually nothing to help the trier of fact decide the all-important question of specific causation” and is based solely on the belief that any exposure should not be ruled out as a contributing cause. Finally, the court pointed out that the fact that this type of testimony survived Daubert challenges in the past was an “aberration.”

In December 2014, the Northern District of Illinois similarly found that this theory was inadmissible under Daubert and Rule 702. In Krik v. Crane Co., No. 10-cv-7435, N.D. Ill. December 12, 2014 (Doc. # 314), the Northern District analyzed the opinions of plaintiff’s medical experts and industrial hygienist, finding that these opinions indeed espoused  the “single fiber” theory. In holding that single fiber causation is “not an acceptable approach for a causation expert to take,” the court noted that “single fiber” causation was inconsistent with Illinois’ express adoption of the “frequency, regularity and proximity” causation test in Thacker v. UNR Industries, Inc., 603 N.E.2d  449, 457. Further, the “any exposure” theory was also inadmissible given plaintiff”s experts’ “wholesale failure to based their opinions on facts specific to this case.” In fact, the court specifically pointed out that plaintiff’s experts admitted in their depositions that they had  not considered any case-specific facts in formulating their opinions.

In April 2015, a New York court also rejected the single fiber theory, finding that plaintiff’s theory of cumulative, unquantifiable exposure did not pass muster under New York’s rules of evidence. Juni v. A.O. Smith Water Products, No. 19031/12, 2015 WL 1623788 (N.Y. Sup. Ct., N.Y. County Apr. 13, 2015). Specifically, the court found that the “every exposure” testimony was insufficient to prove that any specific exposure was a significant contributing factor to causing the disease. The result? An $11 million verdict against Ford was overturned.

These most recent rejections of the “every exposure” theory are significant victories for defendants because they add to the accumulation of similar rulings across the country. After years of accepting the “every exposure” theory, courts are now requiring that both plaintiff and defense expert opinions be based on case-specific facts grounded in science.

Illinois Slashes Jury Size from 12 to 6 Effective June 1

In December 2014, in the final moments of the lame-duck session, Governor Pat Quinn (D) signed a bill into law reducing Illinois’s jury size from 12 to 6 and increasing juror pay. The law is effective June 1, 2015. The bill was passed without bipartisan support just as recently elected Governor Bruce Rauner (R) was set to take office. Governor Rauner is targeting the law for repeal, but this is likely a futile effort without the support of the Democrat-controlled Illinois General Assembly.

Previously, parties in a civil case were entitled to demand a 12-person jury. For cases filed before June 1, 2015, the parties are still entitled to a 12-person jury if demanded and paid for.

The law was passed under the guise of increasing juror pay. Jurors will now receive $25 for the first day of service, and $50 for each additional day. Presently, jurors in Cook County receive $17.20 per day, while jurors in some other Illinois counties receive the statutory minimum of between $4 and $10 per day. Supporters of the law maintain that reducing the jury size from 12 to 6 was a necessary corollary to offset the pay increase.

The measure is largely viewed as favorable to plaintiffs and unfavorable to defendants, as underscored by the fact that the bill was lobbied by the Illinois Trial Lawyers Association (plaintiffs’ bar) and generally opposed by the Illinois Association for Defense Trial Counsel. The defense bar contends that it is easier for plaintiffs to convince 6 jurors than it is to convince 12, which they must do as plaintiffs have the burden of proof. Stated differently, it is easier for the defense to convince 1 in 12 to hold out than it is to convince 1 in 6 to hold out. This is important as Illinois requires unanimous jury verdicts. The plaintiffs’ bar makes the counterargument that—on the flip side—where the defense has a strong case, it is less likely that a 6-person jury will have a holdout for the plaintiff than a 12-person jury. In other words, the plaintiffs’ bar maintains that the law is neutral on its face, and whichever side has the better case will win irrespective of jury size.

Proponents of the law point to additional advantages, including higher pay, shorter voir dire, reduced litigation costs, and fewer citizens being called to jury duty. Supporters claim that being called upon less often and being compensated better will make jurors more willing to serve. Proponents state that the increased pay is paramount, because—although Illinois has a law requiring employers to permit employees time off for jury service—Illinois does not have a law requiring employers to pay employees for their time spent serving on a jury.

Opponents are unwavering in their belief that the law was passed with the primary intent of decreasing the jury size, and that increasing juror pay was mere pretext. Indeed, perhaps many would have been in favor of increasing juror pay, so long as it was “paid for” with other government cuts.

Opponents cite to additional drawbacks. First, they contend that 12-person juries are more diverse, which means they more accurately reflect the views of the broader community. Second, 12-person juries have a better collective memory of the testimony and other evidence, thereby decreasing the likelihood that pure emotion and passion will infiltrate jury deliberations. Third, critics claim that dominant personalities can more easily sway 6-person juries than 12-person juries. Fourth, opponents suggest that there is less debate with 6-person juries, which are more likely to reach a consensus quickly.

Interestingly, this law becomes effective on the same day as a separate measure that excludes asbestos-related personal injury claims from the ten-year construction statute of repose. We previously blogged about this measure here. Both bills were heavily backed by Democrats and the trial lawyers who support them. Both bills were also signed into law by former Governor Quinn in the waning days of his gubernatorial term.

To Spoil or Not to Spoil? Why Speculation Carried the Day for the Defense Against Plaintiff’s Spoliation Claims

This holiday season has been good to the asbestos defense bar.  On December 16, 2014, the Illinois Fourth District Appellate Court decided a case which emphasizes the need for a plaintiff to properly prove causation by non-speculative evidence.  In the process, the court rejected a “sham” spoliation of evidence claim, finding that defendant’s spoliation of evidence was immaterial in light of the witness testimony presented by the plaintiff.  This is the first published decision in this State pertaining to spoliation.

In Holloway v. Sprinkmann Sons Corp., 2014 IL App (4th) 131118, plaintiff Carol Holloway brought a negligence action against defendant Sprinkmann, an alleged asbestos insulation supplier, alleging that  defendant delivered and installed asbestos-containing insulation at plaintiff’s jobsite  while she worked as at the Eureka vacuum cleaner factory in Bloomington, IL.  As an alternative theory, plaintiff argued that Sprinkmann wrongfully destroyed evidence that plaintiff needed to prove her case.  Plaintiff specifically alleged that Sprinkmann destroyed records indicating the types of insulation it sold and to whom the insulation was sold.  Destroying this evidence, plaintiff argued, prevented her from demonstrating which specific asbestos-containing products were sold and delivered by Sprinkmann to her jobsites.

At trial, plaintiff called Arthur B. Kremers, Sprinkmann’s former owner.  When Kremers began working for Sprinkmann in 1969, old records dating back to the 1950s were kept in the basement of the company’s Peoria office.  These records showed the brand and manufacturer of each product defendant had sold and delivered, as well as which employees had installed each product.  Apparently, as early as 1957, Sprinkmann employees began making claims for asbestos-related disease, relying on the basement records to show which brands of insulation the employees had installed.Sometime in the 1980s, however, Kremers shipped the basement records to a recycling center because “defendant was running out of space.”  The destruction of the records, according to Kremers, was consistent with Sprinkmann’s document retention policy, under which sales contracts and invoices were to be retained for only three years.

Crying foul over the alleged “spoliation” of evidence, plaintiff called co-worker witness Ellis Carlton and read into evidence an affidavit of another deceased witness, Wesley Klein.  This evidence was uncontroverted, and – as the documents themselves would have done – established that asbestos-containing insulation supplied by defendant Sprinkmann was present at plaintiff’s jobsite and installed by it.

The jury nonetheless returned a general verdict in defendant’s favor, prompting plaintiff to file a motion for a new trial, which was denied by the trial court.  On appeal, plaintiff argued that the jury might have found for plaintiff if it had had the benefit of reviewing the destroyed records establishing that the products were present at plaintiff’s worksite.

The appellate court affirmed the trial court’s judgment.  In doing so, it focused on the fact that the uncontradicted evidence of Klein and Carlton already established that the products were present at the facility.  To the extent that the “spoliated” records would have done nothing more than supply the same information, the jury could have reasonably concluded that the destroyed records would have made no difference in plaintiff’s case.   Thus, the “spoliated” records were no consequence.  For this reason, the court found that plaintiff failed to meet her burden of proving that, but for the destruction of the records, she would have had a reasonable probability of prevailing. The court then expressly addressed the key issue in this case:  that “the real problem in plaintiff’s case was causation, which the records would not have addressed.”  Indeed, the court hammered home the fact that “all plaintiff offered in the trial was speculation that her asbestosis resulted from repair work on the pipe-covering insulation in the Eureka plan, although she never saw any repair work being done on the insulation and there was no other evidence placing her near any such repair work.”

Plaintiff attempted to substantiate her exposure using the testimony medical expert Dr. Arthur Frank in conjunction with her own testimony that she was “in all the different parts of the plant for one reason or another.”   Dr. Frank espoused the “re-entrainment” theory, testifying  that individuals who had never worked hands-on with an asbestos-containing product could still be exposed to asbestos fibers because these fibers drifted around the factory and could be carried a long way by air currents.  According to Dr. Frank, all asbestos-containing products, including steam pipe insulation, released such fibers.  In fact, simply the “passage of time” would release these fibers.  On the other hand, Frank also conceded that a person needed to cross a threshold of a certain amount of exposure before getting asbestosis; Frank could not clarify what the threshold was, though he insisted that, for someone with asbestosis, “each and every exposure to any asbestos product had to be regarded as a cause.”

The court, however, was unpersuaded by plaintiff’s interpretation of her own testimony.  Specifically, the court noted that saying that plaintiff was “in all the different parts of the plant for one reason or another” is not quite the same as saying she “worked all over the plant.”  For argument’s sake, the court assumed that Dr. Frank’s theories were correct, that when asbestos-containing insulation had to be repaired, it created asbestos dust, and that such dust stayed around for a long time and wafted through the air.  However, the court concluded that Frank’s testimony was ultimately irrelevant, as there was no evidence that the buildings in the Eureka plant shared the same air, nor was there any evidence presented suggesting that the buildings in the plant shared a common ventilation system.  Plaintiff could therefore not clearly connect the allegedlyomnipresent “asbestos dust”  to her own inhalation.  Even if she had, the court pointed out problems with the testimony of plaintiff’s “expert,” noting that Frank’s testimony provided no solid, non-speculative evidence that the amount of asbestos dust breathed in by plaintiff under such circumstances would be sufficient to cause asbestosis.

Holloway v. Sprinkmann places great importance on a plaintiff’s burden to show causation with non-speculative evidence.  For plaintiffs like Holloway, certain expert testimony may seem like a home run (eg., the “re-entrainment” theory), but, at the very heart of the matter, such evidence is nothing more than conjecture. In rejecting plaintiff’s spoliation argument, the Sprinkmann court further demonstrated that it will not permit “red herring” issues to distract the court from a lack of admissible evidence of causal links.  This decision from the Illinois appellate court provides further support for defendants seeking to attack speculative evidence, without fear that extrinsic issues that have no bearing on their ultimate liability will alter the result.