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Bricker & Eckler Advocacy Efforts in 2006
On Behalf of the Ohio Manufacturers' Association
2006 proved to be another successful year for The Ohio Manufacturers’ Association to carry out its mission.
As General Counsel, Bricker & Eckler has worked in partnership with the OMA to ensure a competitive business climate in
Ohio for manufacturers. We have an enduring commitment to thoroughly identify issues,
prevent problems and resolve challenges that are unique to the manufacturing industry.
By focusing on the specific concerns that impact Ohio manufacturers’ ability to compete, together we were
able to help to shape public policy in the areas of tax and tort reform, environment, energy, employment law and workers’ compensation.
The OMA continues to be the recognized voice of Ohio’s manufacturers, and we are honored to serve with you to achieve victories
that benefit manufacturers statewide.
Employment Law
Ohio’s 2006 election led to the enactment of two legislative changes with a dramatic impact on business—Issue 2, regarding the
minimum wage increase, and Issue 5, regarding the smoking ban. Throughout the last year, Bricker &
Eckler seized the opportunity to become actively involved in the interpretation of these new requirements by monitoring the
effects they would have on the manufacturing industry.
During post Issue 2 efforts, our attorneys analyzed the amendment and drafted proposed implementing
regulations to suggest positions that would clarify areas of concern to the business community. We communicated daily with
OMA staff to keep the group informed on House Bill 690, its companion bills and various amendments as they moved through the legislative process.
At each stage we provided analyses and suggested modifications to the legislation.
With Issue 5, Bricker & Eckler attended a rules meeting and drafted commentary on the proposed
regulations, both on behalf of the OMA, and continued regular consultations on the regulations as well.
In order to further educate the OMA on these two crucial state issues, Bricker & Eckler
held two Web seminars for more than 175 participants to outline the relevance of the new legislation to manufacturers.
Finally, Bricker & Eckler was also able to provide the OMA with a number of client bulletins to keep manufacturers aware of
employment law developments pertinent to the industry.
Workers’ Compensation
A healthy workers’ compensation system helps manufacturers retain and develop the quality of their work force in Ohio.
Bricker & Eckler worked to ensure viable standards for workers in the industry. In March 2006, the House of Representatives and the
Senate passed Amended Substitute Senate Bill 7, which was signed by
Governor Taft and challenged by referendum petition filed by labor interests.
The referendum effectively delayed implementation of those parts of Senate Bill 7 that were unfavorable to labor,
while allowing other provisions that were unfavorable to business to go into effect.
On behalf of the OMA and others, Bricker & Eckler monitored and participated in litigation in a number of counties related to the referendum
effort and defeated labor’s attempt to delay the effective date of Senate Bill 7.
The OMA
and others also successfully participated in litigation related to the referendum before the Appellate and Supreme Courts of Ohio as amicus. The provisions of the bill became effective after labor’s referendum efforts failed. Those measures subject to the referendum became effective October 11, 2006.
One amendment to Senate Bill 7 raised the deductible that state fund employers can pay from $1,000 to $5,000 for medical-only
claims, thereby avoiding the reserve established by the Bureau of Workers’ Compensation. Senate Bill 7 also codified the
one-claim program established by the Bureau of Workers’ Compensation in 2005 in an effort to assist employers who are no
longer able to qualify for a group rating program. Finally, the Bill reduced previously proposed penalty increases for state
fund employers who, for whatever reason, are unable to timely pay their premiums.
Other important provisions of Senate Bill 7 that directly affect Ohio manufacturers include the following,
which were effective on October 11, 2006 and affect claims that take place on or after this date:
The definition of “injury” in the Ohio Revised Code (ORC) 4123.54 does not include pre-existing conditions,
unless the injury substantially aggravates the pre-existing condition. Once the pre-existing conditions return to a pre-injury status,
medical and indemnity benefits are no longer payable.
Psychiatric conditions that result from forced sexual conduct will be compensable.
This means the only time an injured worker can have an allowed psychological condition without a physical injury would be in the case of forced sexual conduct.
Claims with dates of injury on or after October 11, 2006 will have a five-year statute of limitations in the absence of payment of medical or compensation benefits.
Defending Public Policy Action in the Courts
The OMA has been consistently active in their public policy participation through amicus activity in cases that affect the interests of manufacturers.
These amicus curiae efforts provide an opportunity to present valuable information on the legal arguments in a particular case with the
intent to influence the court’s decision in favor of manufacturers.
Ohio’s Asbestos Litigation Reform Bill (H.B. 292)– Before the Ohio Supreme Court
(1)
In re: Special Docket No. 73958 (Case No. 2006-1279)
The issue in this case is whether a decision by the trial court to apply previous Ohio law instead of H.B. 292’s medical criteria provisions
(which became effective in September 2004) is a final appealable order. When H.B. 292 was enacted, the General
Assembly contemplated this issue and specifically amended R.C. 2505.02 (governing final appealable orders) to permit immediate appeals.
The trial court’s order was not entered in a specific case. Instead, it was intended to apply to tens of thousands of asbestos cases pending in
Cuyahoga County at the time H.B. 292 became effective. If the Court upholds the Cuyahoga County Court of Appeals, then no
personal injury asbestos case can be appealed where it is asserted that the trial court erroneously applied the old law instead of the new law until after trial of the case. This effectively renders H.B. 292 meaningless.
On December 18, 2006, Bricker & Eckler filed an amicus brief on behalf of amici curiae Ohio Manufacturers’ Association,
National Federation of Independent Business/Ohio, Ohio Chamber of Commerce, Ohio Alliance for Civil Justice, and Ohio Chemistry Technology Council.
This case has now been fully briefed and is set for oral argument on June 5, 2007.
(2)
Sinnott v. Aqua-Chem, Inc. (Case No. 2006-1604)
On December 13, 2006, the Ohio Supreme Court accepted a discretionary appeal from the
Eighth District Court of Appeals in
Sinnott v. Aqua-Chem, Inc. At issue in Sinnott is whether the trial court’s
decision finding that the Plaintiff made a prima facie showing under R.C. 2307.92 is a final appealable order.
The trial court applied H.B. 292 and determined that the Plaintiff presented sufficient
evidence to satisfy “the intent of the new statute.”
The Defendants appealed the trial court’s determination. The Eighth District Court of Appeals sua sponte dismissed the appeal as “premature” and summarily rejected the subsequent motion for reconsideration. Defendants appealed the decision to the Ohio Supreme Court. The record was submitted to the Ohio Supreme Court on December 26, 2006. Defendants-Appellants’ briefs were filed on February 5, 2007.
In the announcement to accept the appeal, both Justices Lundberg Stratton and O’Connor
noted that they would hold the Sinnott case for a decision in the In re: Special Docket case (see above).
(3)
Ackison v. Anchor Packing Co. (Case No. 2007-0219)
On February 5, 2007, Defendants filed a notice of appeal and asked the Ohio Supreme Court to accept their discretionary
appeal in this case in which the Fourth District Court of Appeals held that application of H.B. 292 was unconstitutionally retroactive.
Bricker & Eckler filed a memorandum in support of jurisdiction on behalf of amici curiae, OMA, NFIB, Ohio
Chamber, OACJ, and OCTC. Plaintiffs’ response is due on March 7, 2007.
Plaintiff-Appellant in this case alleged that the decedent’s exposure to asbestos caused his asbestosis. Among other things, the trial court determined that (1) Appellant had failed to establish a prima facie case under H.B. 292 and (2) H.B. 292 did not impair Appellant’s substantive rights and therefore, could be applied to cases pending when H.B. 292 became effective. The Forth District Court of Appeals addressed the issue of “whether applying the legislation to appellant’s case would be unconstitutionally retroactive.” The court of appeals rejected Appellees’ arguments and concluded that “applying H.B. 292 to appellant’s asbestos-related claims would be an unconstitutionally retroactive application.” The case was remanded to the trial court for evaluation under Ohio common law prior to the enactment of H.B. 292.
A motion to certify a conflict was also filed with the Fourth District Court of Appeals. The conflict case is Wilson v. AC & S, Inc., 12th Dist. No. CA2006-03-056, 2006-Ohio-6701 (which was issued on December 18, 2006). On February 28, the Fourth District certified a conflict with the Wilson decision. The specific issue certified is: “Can Ohio Revised Code Sections 2307.91, 2307.92, and 2307.93 be applied to cases already pending on September 2, 2004?” This is the first step required for certification of a conflict by the Ohio Supreme Court. The parties will now brief the issue of whether there is a conflict between the two appellate districts in the Ohio Supreme Court.
Comprehensive Reform Legislation (SB 80) – Before the Ohio Supreme Court
(1)
Arbino v. Johnson & Johnson (Case No. 2006-1212)
This is a products liability case that involves the Ortho Evra Birth Control Patch. It is pending before Judge Katz (U.S. District Court for the Northern District of Ohio) pursuant to a multi-district litigation. Plaintiff Arbino filed a motion for partial summary judgment in federal district court to seek a ruling on the constitutionality of several provisions of S.B. 80. In lieu of deciding the motion, Judge Katz entered a certification order asking the Ohio Supreme Court to decide the constitutionality of the provisions at issue.
The Ohio Supreme Court addressed, and then certified, the following provisions:
The non-economic damages limitation included in ORC §2315.18;
The collateral source provision included in ORC §2315.20; and
The punitive damages limitations included in ORC §2315.21.
Plaintiff and her amici filed their briefs on October 24, 2006. The Johnson & Johnson
defendants and their amici filed briefs on December 18, 2006. Bricker & Eckler filed a brief on
behalf of the Ohio Alliance for Civil Justice. A separate amicus brief was filed by the OSMA, the OHA and the OOA, that supported the constitutionality of the non-economic damages cap. The Ohio Attorney General, on behalf of the State of Ohio, filed its brief on January 5, 2007. The Plaintiff’s reply brief was filed on January 25, 2007. Briefing has been completed and oral argument has been scheduled for May 1, 2007.
(2)
Groch v. General Motors Corp. (Case No. 2006-1914)
On December 27, 2006, the Ohio Supreme Court agreed to answer nine questions challenging the constitutionality of Senate Bill 80.
These questions were certified from the Northern District of Ohio, Western Division in Groch v. General Motors Corp.
Eight of the questions relate to the workers’ compensation subrogation statutes and the statute of repose for products. The ninth question certified relates to the entirety of S.B. 80: “Does Senate Bill 80 violate the one-subject rule, Art. II, Section 15, of the Ohio Constitution?” Thus, the Court’s answers to the questions before it will have an impact far beyond the context of cases involving workers’ compensation subrogation or statute of repose issues.
In Groch, an employee of General Motors was injured while operating a trim press on the job. Plaintiff Doug Grouch sued GM alleging an employment intentional tort and also sued the manufacturers of the trim press (Kard Corporation and Racine Federated, Inc.) alleging a products liability claim. Plaintiff’s wife filed a claim for loss of consortium. GM asserted a subrogation interest in Plaintiff’s tort recovery for its payment to him of workers’ compensation benefits. In response, Plaintiff asserted that the Ohio statutes granting GM’s subrogation rights (R.C. 4123.93 and R.C. 4123.931) are unconstitutional. The defendants that manufactured the trim press asserted that they are immune from liability pursuant to the statute of repose for products liability claims (R.C. 2305.10). Plaintiff argues that the statute of repose for products liability claims is unconstitutional on several grounds, including that it violates the ban on retroactive laws.
In the District Court, Ohio Attorney General Jim Petro intervened on behalf of the State to defend the constitutionality of the statutes. It is not known whether new Attorney General Marc Dann will retain special counsel to handle this matter.
Plaintiffs’ and supporting amicus parties filed their briefs on February 26, 2007. Briefs
filed in support of the constitutionality of S.B. 80 are due 30 days after the Plaintiffs file their brief.
(3)
Senate Bill 117 – Veto Challenge
In December 2006, the Ohio General Assembly approved Senate Bill 117. Generally this bill:
Clarified that a city’s ability to sue product manufacturers, including paint companies alleged to have contributed to lead poisoning, and can only be brought under the Ohio Product Liability Law
Permitted consumer to recover $5,000 of non-economic damages under Ohio’s
Consumer Sales Protection Act; and
Revised Ohio law as it relates to attorney-client privilege.
Prior to leaving office, former Governor Bob Taft indicated that he would allow this bill to become law without his signature, which pursuant to Ohio’s Constitution happens after 10 days. Governor Taft filed Senate Bill 117 with the Ohio Secretary of State’s office before his final day in office. On Governor Strickland’s first day in office, the incoming Secretary of State, Jennifer Brunner, retrieved the bill and sent it back to Governor Strickland, who promptly vetoed it.
On February 2, 2007, a complaint seeking a writ of mandamus was filed against Secretary of State Brunner in the Ohio Supreme Court. Senate and House Republican Leaders have engaged Vorys, Sater, Seymour and Pease to represent the Legislature in this case. Attorney General Dann will represent the Secretary of State and the Governor, if he becomes a party. The challenge involves two issues: (1) did Secretary of State Brunner have the authority to send Senate Bill 117 back to Governor Strickland and (2) when did the 10-day constitutional deadline for gubernatorial action expire.
As members of the Ohio Alliance for Civil Justice, the OMA plans to participate as amicus curiae. The Secretary has until March 1, 2007 to respond to the Complaint.
Environmental Issues
Throughout 2006, Bricker & Eckler worked closely with the Ohio Environmental Protection Agency (EPA) to maintain a healthy environment for the state and to monitor the legislative process to ensure fairness for the manufacturing industry.
Bricker & Eckler’s advocacy efforts came to the forefront during the process to pass the Ohio EPA Air Rules, which were written in response to the principles of Senate Bill 265. When the Air Rules were first drafted, they contained a list of 639 toxic air contaminants to potentially ban. After the OMA voiced their concerns, however, the list was reduced to 303 compounds. The rules became effective in December 2006.
Though several groups, such as the Sierra Club, Ohio Citizen Action, Ohio Academy of Trial Lawyers, Environmental Community Organization and the Buckeye Environmental Network have appealed portions of the rule to the Ohio Environmental Review Appeals Commission (ERAC), the OMA and other business trade groups are considering the possibility of intervening in the appeal to protect the rule as adopted. Regardless of whether intervention is attempted or granted by ERAC, OMA will continue to monitor this appeal, which could have a significant impact on the industry.
In addition to other Ohio EPA initiatives of 2006, they also proposed a number of air and water rules. OMA
has played, and continues to play, an active role in the proposal and adoption process of these rules and policies.
The following is a summary of the most imperative developments for manufacturers:
Ohio EPA Proposed Industrial Waste Rules (OAC Chapter 3745-525)
On August 1, 2006, Ohio EPA unveiled a new strategy for the regulation of industrial waste, including new proposed rules for the site placement and design of disposal facilities for such waste. A comprehensive summary of the proposed rules was included in previous OMA Counsel Reports. On November 1, 2006, OMA submitted comments opposing portions of the draft rule package. Ohio EPA has yet to act on the proposed rule package.
Proposed Beneficial Use Rules (OAC 3745-525-801 through -811)
On November 8, 2006, Ohio EPA released its draft Beneficial Use Rules package. OMA submitted comments on the proposed rule package on February 6, 2007. OMA supports the general concept behind the rules, but some of the particular provisions either did not comply with real-world conditions or did not provide adequate options for the beneficial use of these industrial by-products. Ohio EPA has yet to act on this draft rule package.
“Consumer Products” Rule (OAC Chapter 3745-112)
On December 28, 2006, Ohio EPA proposed new rules that aimed to reduce VOC’s from consumer products (e.g., adhesive, air fresheners, aerosols, carpet cleaners, etc.). The rules intend to assist the state in achieving and/or maintaining the national 8-hour ground level ozone standard. The draft rule applies to “any person who sells, supplies, offers for sale, or manufactures consumer products on or after January 1, 2008 for use in the state of Ohio.” It exempts a manufacturer or distributor who sells, supplies or offers for sale in the state of Ohio a consumer product that does not meet the VOC standards. As long as the manufacturer or distributor can demonstrate that the consumer product is intended for shipment and use outside of the state of Ohio, and that they’ve taken reasonable precautions to assure so. Therefore, it applies to a consumer product sold in Ohio regardless of place of manufacture. Public comments were due on January 29, 2007.
Clean Air Mercury Rule (CAMR) (OAC 3745-108)
Ohio has proposed policies to implement federal rules known as the Clean Air Mercury Rules (CAMR), published by U.S. EPA in May 2005. CAMR establishes a cap and trade program for emissions of mercury and sets a total mercury emissions ceiling for Ohio. Ohio EPA predicts that, when fully implemented, these rules would reduce mercury emissions from Ohio-based utilities by 86 percent. Written public comments were due by January 27, 2007 and a public hearing on the proposed rules was held on January 29, 2007. Ohio EPA has not yet acted upon these rules.
Tax Reform
Over the past year, Bricker & Eckler has diligently led the advancement and protection of the OMA’s interests in tax issues in order to increase competitiveness and encourage economic growth in Ohio.
In some cases, certain tax legislation deserves a closer look. With this in mind, Bricker & Eckler has worked hard to combat the various attempts to exclude particular products or businesses from paying the commercial activity tax (CAT). We assisted in the battle on House Bill 530, which, if passed, would have allowed goods shipped into or out of a foreign trade zone to avoid the CAT. We also worked to keep the qualifying distribution center exclusion narrowly drafted. Beyond this specific legislation, we recently met with the new tax commissioner to express our concerns about erosion of the CAT tax base. We will continue to take a strong stance against CAT exclusions in order to secure the tax’s broad base and low rate.
On the other hand, we’ve given support to legislation such as House Bill 390, which imposed limits on the time period that the tax commissioner must begin collection efforts on old tax claims. We have also worked to reduce or eliminate the kWh tax to make it easier for taxpayers with multiple locations to qualify for self-assessor status, which would lower the cost of energy to manufacturers.
Energy Issues
The availability of dependable, reasonably priced energy resources is vital to Ohio manufacturers. Indeed, energy issues have a great impact on all of Ohio’s economy. During 2006, Bricker & Eckler continued to provide legal counsel, legislative expertise and political advice to the OMA Energy Resources Committee.
In 2006, the Committee actively participated in the Public Utilities Commission of Ohio’s (PUCO) review of its existing net metering, demand response and cogeneration rules and practices to determine the consistency of those rules and practices with the federal Electric Policy Act of 2005 (PUCO Case No. 05-1500-EL-COI). The Committee collaborated with the Ohio Department of Development to advocate for rules designed to encourage the deployment of distributed generation resources in Ohio.
Distributed generation (“DG”) refers generally to the use of on-site or localized generation, including conventional cogeneration facilities and also renewable sources of generation, such as wind, solar and biomass. DG is rapidly emerging as a significant part of the generation source mix in regional discussions about resource adequacy and load growth. In terms of cost, environmental impact, and system reliability, DG is an attractive option for both consumers and policymakers.
Amicus Activity
Through our amicus activity provided in several significant cases,
Bricker & Eckler made considerable legal strides to pave the way for further
opportunities for the manufacturing industry to succeed.
Alice Peters, Administrator of the Estate of William M. Peters, Jr. v. Columbus Steel
Castings Co. (Case no. 06-0507) (10th District Court of Appeals, Franklin County)
This case deals with workplace accidents that lead to the
death of an employee who has agreed to arbitrate all job-related civil disputes with his
employer. In July 2003, William Peters, a leased employee of Columbus Steel Castings (CSC),
was killed in a 50-foot fall from a catwalk while he was working at the CSC forging plant in Columbus.
The issue in question is whether relatives of the decedent may bring independent
wrongful death claims against the employer under R.C. 2125.02 and if the
claims are subject to compulsory arbitration under the terms of the decedent’s employer/employee
arbitration agreement.
After the Franklin County Court of Common Pleas dismissed CSC’s motion to dismiss, which was
affirmed by the Tenth District Court of Appeals, CSC sought and was
granted Supreme Court review of the Tenth District’s ruling.
Oral argument took place on Feb. 28, 2007, the case currently awaits a decision.
McLeod v. Mt. Sinai (Excessive Verdict)
In this case, the jury rendered a $30 million verdict against
the medical malpractice defendants. No punitive damages were awarded.
The visiting judge who conducted the trial vacated the verdict for several reasons,
including the improper conduct of counsel, erroneously admitted evidence, and
because the verdict was influenced by the passion and prejudice of the jury.
The Eighth District Court of Appeals referred to the verdict as “manifestly excessive.”
Instead of ordering a new trial, the court of appeals remanded the case for consideration of remittitur.
Bricker & Eckler filed an amicus brief on behalf of amici curiae the OSMA, the OHA, and the AMA.
Amici curiae argued that the only proper remedy under the circumstances is a new trial, and
discussed the impact on Ohio’s health care system if verdicts such as this are not overturned.
No tort reform statutes apply to this case because the cause of action arose prior to the effective date of Ohio’s tort reform bill applicable to medical claims (Ohio Senate Bill 281).
Manley v. Marsico (Affidavit of Merit)
This case is pending before the Ohio Supreme Court and involves
the affidavit of merit requirement found in Ohio Civil Rule 10(D)(2), which became effective in July 2005.
The statute requires a plaintiff in a medical negligence case to file with the complaint an affidavit from a qualified medical expert stating that the affiant: (1) has reviewed the medical records concerning the allegations; (2) is familiar with the applicable standard of care; and (3) holds the opinion that the standard of care was breached by one or more of the defendants and that the breach caused injury to the plaintiff.
In the Manley case, the plaintiff failed to file the affidavit of merit. Defendant Marsico filed a motion to dismiss for failure to comply with the affidavit of merit rule. The trial court denied the motion and Defendant Marsico appealed. The Twelfth District Court of Appeals dismissed the appeal for lack of a final appealable order. The Ohio Supreme Court accepted the discretionary appeal.
Briefs filed in support of Appellant were filed on December 12, 2006. Bricker & Eckler filed an
amicus brief on behalf of the OSMA, the OHA, and the OOA, arguing that the affidavit of merit rule is effectively meaningless if an immediate appeal from a decision denying dismissal for failure to comply is not permitted. The Appellee’s brief was filed on January 31, 2007. Appellant’s reply brief was due on February 20, 2007.
State of Ohio ex rel. David M. Gross v. The Industrial Commission of Ohio, et al., (Supreme Court Case No. 05-1689)
After injuring himself as a result of his failure to follow rules concerning the proper process
to clean the fryers, Mr. Gross, a Kentucky Fried Chicken employee, was found to be
temporarily and totally disabled shortly after the injury. He was fired several months later. An
amicus brief was filed on behalf of the Ohio Manufacturers’ Association and in conjunction with the
Ohio Chamber of Commerce, National Federal of Independent Business, Ohio Self-Insurers Association,
and Ohio Counsel of Retail Merchants. On December 27, 2006, the Ohio Supreme Court
issued its decision and found that the Industrial Commission did not abuse
its discretion in finding that Mr. Gross voluntarily abandoned his employment,
thus disqualifying himself from compensation for temporary total disability.
In doing so, the court relied on previous precedent set forth in the case of (1995), 72 Ohio St.3d 401.
Though Gross filed a motion for reconsideration, the OMA filed a brief to oppose the motion.
We currently await a decision from the court. The OMA and others have indicated in its brief that if
one is fired for violating a clear work rule that he or she knew or should have known about,
it constitutes a voluntary abandonment of the job, therefore rendering one ineligible
to receive temporary total disability benefits in accordance with the law set forth in the Louisiana-Pacific case.
Summary
Hard work paid off for the Ohio Manufacturers’ Association in 2006. As a team, we collectively continued to establish a voice for manufacturers by improving Ohio’s business climate and easing the burden on the manufacturers through public policy efforts. We look forward to our ongoing partnership with the OMA and the implementation of these significant achievements.
Kurt Tunnell is General Counsel to the Ohio Manufacturers' Association, and
works extensively with the business and manufacturing industry helping to improve the business climate in Ohio.
He can be reached at 614.227.8837 or ktunnell@bricker.com.
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