Party Can Reserve Right To Sue Co-Tortfeasors In Release

In Vanalstine v. Palms West Hospital, L.P. (4D10-4850), the trial court entered judgment in favor of the defendants because it concluded language in the plaintiff's release of other persons waived the right to recover from the remaining defendants. The Fourth District disagreed and reversed the judgment because the release "'expressly reserved' the right to pursue causes of action against the medical providers for the damages resulting from their negligence when they settled with the pharmacy and pharmacist.

Fifth District Explains (Again) What Is Needed To Obtain Foreclosure Judgment

In Richards v. HSBC Bank USA as Trustee for PHH 2007 (5D10-3895), the Fifth District reversed a foreclosure judgment and succinctly stated what is needed to prevail in a mortgage foreclosure action. The court stated:

The proper party with standing to foreclose a note and mortgage is the holder of the note and mortgage or the holder’s representative. See Gee v. U.S. Bank Nat’l Ass’n, 72 So. 3d 211, 213 (Fla. 5th DCA 2011). Thus, the party seeking foreclosure must present evidence that it holds the note and mortgage in question in order to proceed with its foreclosure action. Id. A plaintiff must tender the original promissory note to the trial court or seek to reestablish the note under section 673.3091, Florida Statutes (2010). Id. If the note does not name the plaintiff as the payee, the note must bear an endorsement in favor of the plaintiff or a blank endorsement. Id. Alternatively, the plaintiff may submit evidence of an assignment from the payee to the plaintiff or an affidavit of ownership to prove its status as a holder of the note. Id.

In this case, the note was specifically indorsed to an entity other than HSBC and the relationship between that entity and HSBC was not explained. Therefore, summary judgment was not proper.

Testimony Of Witness That Dies Before Completion Of Deposition Is Admissible, Regardless Of Whether Cross Examination Occurred

In The Bank of Montreal v. Estate of Antoine (4D10-760), Antoine embezzled more than $13 million in bank funds. After he was arrested, pled guilty, and sentenced to serve his prison sentence in federal prison, the bank sued Antoine and his wife. As part of the suit, the bank sought to place an equitable lien on a residence allegedly purchased with the stolen funds. The bank took Antoine's deposition and Antoine admitted that the residence was purchased with stolen funds. Unfortunately, during the deposition Antoine experienced chest pains which prevented his co-defendant wife from cross examining him. A few days after the deposition was postponed, Antoine died.

During trial, Antoine's wife sought to exclude his testimony because she was not able to question him. The trial court agreed and excluded the deposition from trial. The Fourth District analyzed analogous caselaw from around the country and held that the partial deposition was improperly excluded. Deposition of an unavailable witness is generally not excluded if the objecting party had a chance to cross examine the witness at the deposition. See Fla. Stat. § 90.804(2)(a). Antoine's wife did not have the opportunity to question Antoine, however, "Florida Rule of Civil Procedure 1.330(a) provides that:

[a]t the trial...any part or all of a deposition may be used against any party who was present or represented at the taking of the deposition or who had reasonable notice of it so far as admissible under the rules of evidence applied as though the witness were then present and testifying in accordance with any of the following provisions:....(3) The deposition of a witness, whether or not a party, may be used by any party for any purpose if the court finds: (A) that the witness is dead . .. .

[emphasis supplied]. "Hearsay which is inadmissible because it does not satisfy the provisions of the former testimony rule will still be admissible if it satisfies the provisions of rule 1.330."

The court then discussed the applicable authorities from around the country which "establish that it is appropriate for us to consider the value that the wife’s cross-examination of Antoine would have provided to her defense." In this case, the court determined the cross examination would not have elicited anything of importance. Therefore, the deposition should have been admitted.

Note Merges Into Judgment & "cause’s independent existence terminates"

In Weston Orlando Park, Inc. v. Fairwinds Credit Union (5D11-2260), the Fifth District affirmed the trial Court's judgment with one exception. That exception is copied below:

The trial court could not reserve jurisdiction on Fairwinds’s claims for breach ofthe promissory notes, separate from the claims for foreclosure, because the debtrepresented by the notes had merged into the final judgment. The doctrine of mergerprovides that when a valid and final judgment is rendered in favor of a plaintiff, theoriginal debt or cause of action upon which an adjudication is predicated merges intothe final judgment, and, consequently, the cause’s independent existence terminates.

 

Appeal Of Judgment Dismissed For Failure To Comply With Trial Courts Post Judgment Orders

In Daniels v. JPMorgan Chase Bank, et al, (3D11-1237), the Third District dismissed an appeal of a final judgment due to the appellants failure to comply with post judgment orders entered by the trial court. The court stated "A party in contempt of the trial court cannotseek to invoke the authority of this Court." The court did stay the dismissal for twenty days to allow the appellant to correct the failure to comply with the trial courts orders.

What A Court Must Consider To Sanction A Party

In Martin v. Maroone Chevrolet of Delray Beach (4D10-5006), the Fourth District again stated the test a court must follow to strike a pleading. The court stated:

Before a court may strike a party’s pleadings as a sanction, the courtmust consider the following factors:

1) whether the attorney’s disobedience was willful,deliberate, or contumacious, rather than an act of neglect orinexperience; 2) whether the attorney has been previouslysanctioned; 3) whether the client was personally involved inthe act of disobedience; 4) whether the delay prejudiced theopposing party through undue expense, loss of evidence, orin some other fashion; 5) whether the attorney offered reasonable justification for noncompliance; and 6) whetherthe delay created significant problems of judicial administration.

The court must also consider whether a lesser sanction would be a“viable alternative.” Id. Whether the litigant was involved in themisconduct is a factor to be weighed in the Kozel analysis, but does notweigh more heavily than the other factors. See Ham v. Dunmire, 891 So.2d 492, 497 (Fla. 2004). “The Kozel criteria with an emphasis onwhether prejudice has occurred control.” Id. at 502.

Florida Supreme Court Recedes From "Joint Residency Rule" In Venue Disputes

In Brown v. Nagelhout (SC10-868), the Florida Supreme Court receded from its 1957 opinion, Enfinger v. Baxley, 96 So. 2d 538 (Fla. 1957), and abolished "the judicially created joint residency rule" applied in venue challenges. The court described the facts as follows:

Willie and Brenda Brown filed a complaint in Broward County, Florida, against Kim Nagelhout, Helena Chemical Co., Inc., and CSX Transportation, Inc., alleging multiple causes of action arising from a collision between a truck owned by Helena Chemical and operated by Nagelhout and a train operated by CSX, on which Willie Brown was riding. The collision occurred in Pasco County, Florida.....Relying on Enfinger, the trial court concluded that because Nagelhout and Helena Chemical both reside in Pasco County, Broward County was not a proper venue in which to litigate the Browns' complaint.

With regard to the legal issues, the court first noted that "[t]he determination of venue in Florida is governed by a series of statutory provisions set forth in chapter 47, Florida Statutes (2011)." After discussing the relevant statutory language, the court stated "[f]inally, section 47.021, Florida Statutes (2011), provides that '[a]ctions against two or more defendants residing in different counties may be brought in any county in which any defendant resides.'”

Under this statutory scheme, the plaintiff may select a venue within which to litigate a cause of action based on the residency of the defendants. In the instant case, defendant Nagelhout, an individual, resides in Pasco County. Defendant Helena Chemical, a foreign corporation, has a business residence in Pasco County and a registered agent in Broward County. Defendant CSX has its principal place of business in Duval County, Florida, and its registered agent in Leon County, Florida. While it is not clear from the record whether CSX is a domestic or foreign corporation, the defendants do not claim that CSX has “an office for transaction of its customary business” or “an agent or other representative” in Pasco County. § 47.051, Fla. Stat. Thus, based on the above statutes, the Browns had the option to file suit based on residency in Pasco, Broward, Duval, or Leon counties. In their motion to transfer venue, however, the defendants argued that under Enfinger, venue lay only in Pasco County, where Nagelhout and Helena Chemical share a common county of residence.

In conclusion, the court held:

Here, the joint residency rule of Enfinger is based on a serious interpretative error, which resulted in imposing a meaning on the statute that is “unsound in principle.”...[therefore] we recede from Enfinger's restriction on a plaintif's right to select a venue based on the defendants' residency. When reviewing a plaintiff's venue selection, the Florida courts should apply the plain language of sections 47.011, 47.021, and 47.051, Florida Statutes. Where there are multiple defendants to an action, a plaintiff may choose as venue any county in which any defendant, without consideration of his or her codefendants, may be considered a resident.

Fifth Amendment Protections Apply When Requiring Decryption of Hard Drive

In In re: Grand Jury Subpoena Duces Tecum Dated March 25, 2011, the Eleventh Circuit released a published opinion and reversed a district court's order finding Doe in civil contempt. 

Doe was subpoened to testify before a grand jury and to bring his external hard drives with him. "The subpoena required Doe to produce the 'unencrypted contents' of the digital media, and 'any and all containers or folders thereon.'” In total, there were approximately 5TB of hard drives and they were encrypted with TrueCrypt. "Federal Bureau of Investigation forensic examiners analyzed the digital media, but were unable to access certain portions of the hard drives" and "the forensic examiners were unable to recover any data." As the court noted, "[e]ssentially, TrueCrypt can make certain data inaccessible; in doing so, the program can create partitions within a hard drive so that even if one part of the hard drive is accessed, other parts of the hard drive remain secured."

After Doe informed the  United States Attorney that he would not decrypt the hard drives, the U.S. Attorney sought and obtained an order providing Doe "immunity for the act of production of the unencrypted drives, but [did] not convey immunity regarding the United States’ [derivative] use of the decrypted contents of the drives." 

Doe appeared before the grand jury and refused to decrypt the hard drives. "The U.S. Attorney immediately moved the district court for an order requiring Doe to show cause why Doe should not be held in civil contempt. The court issued the requested order, requiring Doe to show cause for his refusal to decrypt the hard drives. Doe, responding, explained that he invoked his Fifth Amendment privilege against self-incrimination because the Government’s use of the decrypted contents of the hard drives would constitute derivative use of his immunized testimony, use not protected by the district court’s grant of immunity...The court rejected Doe’s alternative explanations, adjudged him in contempt of court, and ordered him incarcerated."

The court stated:

We turn now to the merits of Doe’s appeal. In compelling Doe to produce the unencrypted contents of the hard drives and then in holding him in contempt for failing to do so, the district court concluded that the Government’s use of the unencrypted contents in a prosecution against Doe would not constitute the derivative use of compelled testimony protected by the Fifth Amendment privilege against self-incrimination. This is so, the court thought, because Doe’s decryption and production of the hard drives would not constitute “testimony.” And although that was the Government’s view as well, the Government nonetheless requested act-of-production immunity. The district court granted this request.

For the reasons that follow, we hold that Doe’s decryption and production of the hard drives’ contents would trigger Fifth Amendment protection because it would be testimonial, and that such protection would extend to the Government’s use of the drives’ contents. The district court therefore erred in two respects. First, it erred in concluding that Doe’s act of decryption and production would not constitute testimony. Second, in granting Doe immunity, it erred in limiting his immunity, under 18 U.S.C. §§ 6002 and 6003, to the Government’s use of his act of decryption and production, but allowing the Government derivative use of the evidence such act disclosed.

$80 Million Punitive Award Unconstitutional; $10 Million Compensatory Award Affirmed In Smoker Case

In R.J. Reynolds Tobacco Company v. Townsend (1D10-4585), the First District upheld a jury verdict against the R.J. Reynolds Tobacco Company for $10.8 million in compensatory damages (prior to deducting due to the 49% of fault attributed to the smoker) but rejected an $80 million punitive damage award as being excessive. Judge Van Nortwick wrote the majority opinion and Judge Marstiller. Judge Wetherell wrote an opinion concurring in part and dissenting in part. The court stated:

The Supreme Court has been “reluctant to identify concrete constitutional limits on the ratio between harm . . . to the plaintiff and the punitive damages award,” State Farm, 538 U.S. at 424. Nevertheless, it has identified a circumstance in which caution is required: “When compensatory damages are substantial, then a lesser ratio, perhaps only equal to compensatory damages, can reach the outermost limit of the due process guarantee.” State Farm, 538 U.S. at 425. As the Supreme Court noted in Gore, however, there is no “simple mathematical formula” that marks the constitutional line. Gore, 517 U.S. at 582. See also State Farm, 538 U.S. at 425 (“We decline again to impose a bright-line ratio which a punitive damages award cannot exceed.”); Martin, 53 So. 3d at 1072 (rejecting RJR’s argument that the United States Supreme Court adopted a bright-line 1 to 1 ratio as a limit on punitive damages).

***

Here, the $10.8 million compensatory damage award—which is substantial by any measure—justifies a lower ratio than 3.7 to 1. Although we find the $40.8 punitive damage award excessive under the Gore and State Farm criteria, a 1 to 1 ratio is unwarranted, however, because the evidence of the extreme reprehensibility and wantonness of RJR’s conduct was substantial. See Gore, 517 U.S. at 575 (noting that “the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant’s conduct”).

In sum, applying the Gore and State Farm criteria, in view of the substantial compensatory damages awarded here, we agree with RJR that the $40.8 million punitive damage award in this case is constitutionally excessive. Thus, it was error to deny RJR’s motion for new trial or remittitur. Accordingly, we reverse and remand the punitive damages award for the limited purpose of permitting Appellee to choose between a new jury trial solely to determine punitive damages or acceptance of a remittitur judgment on the punitive damages award to be established by the trial court.

Judge Wetherell agreed with the majority as to three challenges not discussed here but would have also reversed the $10.8 million compensatory damages award which was solely comprised of non-economic pain and suffering damages.