The executive branch of the government may not have won as big a victory as it seemed last June, when the U.S. Supreme Court threw out a damage suit against the Department of Transportation. Last month, in a case that the government thought was much like the one that had been before the justices, the U.S. Court of Appeals in St. Louis took a narrow reading of the high court ruling, and gave the green light to a prosecution of the Defense Department.
At issue in both matters is how to read an exception to the Federal Tort Claims Act. Governments generally are immune from suits without their permission, so in the FTCA, Congress gave a broad, general permission for damage claims "to the same extent as a private individual under like circumstances" could be sued. Because of the FTCA, you can sue the government if you break a leg in a slip on a soapy floor in the Commerce Department building, just as you could sue The Washington Post if the accident occurred in the lobby of its headquarters building.
But one of the exceptions to that general permission bars claims "based on the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency." So when someone is hurt in an accident that a more diligent federal safety inspection could have prevented, the key question is whether or not that safety responsibility is "discretionary." If it is, the courts will toss out any damage claims against the government.
The two cases that arrived at the Supreme Court last year both involved aircraft accidents that the plaintiffs contended would not have happened had the Federal Aviation Administration been more diligent in checking out the craft before certifying them. In both cases, the U.S. Court of Appeals in San Francisco thought the FTCA could apply, because the government, taking on the inspector's role, had an obligation to do it properly. It was no longer "discretionary," in this view. But the Supreme Court justices unanimously disagreed, and held that the courts have no power to second-guess how the government goes about its inspection job.
Nonetheless, in McMichael v. Bartlett, the judges in St. Louis approved a suit in which the plaintiff claims that the deaths and injuries from an explosion in a privately owned munitions plant stemmed directly from the failure of Pentagon inspectors to stop safety-rule violations. Judge Gerald W. Heaney based his decision on two key differences from the aircraft cases: The FAA was acting as a regulator, while the DOD was in the munitions facility in a proprietary capacity as a customer; and the FAA used only spot checks to keep tabs on manufacturers, while the DOD had three inspectors on full-time duty in the munitions plant.
Chances are that plaintiff lawyers, always anxious to find a defendant with enough money to pay any damages that are won, are going to argue in a lot of other situations that the government is playing the same safety role the Pentagon was playing in the munitions plant.
In other cases, courts ruled that:
U.S. courts should stay out of disputes between Americans over events that happened in other countries. Judges use the term "comity" -- meaning respect or courtesy -- to explain a ruling based not on the rights of the parties, but on a concept of deference or good will. The U.S. Court of Appeals in San Francisco invoked the concept last month to explain why it was throwing out an antitrust case that claimed that the Bank of America forced a Honduran lumber mill to close so it would not be able to compete in the United States with another timber operation in which the bank had a stake. Possible violations of U.S. antitrust law are at stake, the judges acknowledged. But they said that because the suit raises matters central to Honduran economic policy, it would be better to let any proceedings go forward in courts there rather than in the United States. (Timberlane Lumber v. Bank of America, Dec. 27)
* A company that beats back a patent infringement suit may be able to make the other side pay its lawyer bill three times over. The case involves a dispute in the U.S. District Court in Detroit between two makers of grain dryers, in which the holder of a patent for a particular three-stage process sued the other company for infringement. But, it turned out at trial, the patent itself was invalid, because it was won only by keeping certain vital information secret from the Patent Office and by lying on other key points on the application. Victors in such cases can get the plaintiffs to pay the costs of defending the suits. In antitrust cases, winning plaintiffs can collect three times their actual damages. The grain dryer case is the first to put the two legal provisions together. Trying to enforce the invalid patent was itself an anticompetitive act, Judge Stewart A. Newblatt ruled, calling for a tripling of damages. But because the defendant in the infringement suit did not claim any other damages, the tripling should be applied to the amount of legal fees, he ruled. (Hart-Carter v. J. P. Burroughs, Jan. 9)
* Corporate buyers can take advantage of the strict liability doctrine just like "ordinary consumers." Under strict liability, someone bringing a damage action claiming, say, that a faulty product design caused an accident, need not prove that the defendant was negligent. That, of course, makes it a lot easier for the plaintiff to win -- and was intended to make manufacturers especially careful when turning out inherently dangerous products, such as drugs. But some state courts have said that big corporate buyers, who can test products themselves and can pass on to their own customers any losses, should not be able to take advantage of this shortcut when they sue. In the most recent ruling on the question, however, the Arizona Supreme Court said that corporate customers can use strict liability just like any other plaintiff. That will help make those selling hazardous products more safety-conscious, the justices reasoned. (Salt River Project v. Westinghouse, Dec. 27)
* It's taxpayers who lose out if a private delivery service misses a deadline. The Tax Court, like all other judicial bodies, has deadlines by which petitions must be filed. Papers that come in too late are automatically thrown out. But the law specifies that if a taxpayer mails the petition by the due date, that is good enough. If it arrives after the deadline, the court will still take the case.
The U.S. Court of Appeals in Atlanta, however, last month held that the loophole applies only to papers sent in the U.S. Postal Service. The judges agreed that the Tax Court was right to dismiss petitions that had been delivered to Federal Express before the deadline, but got to the court itself after the cutoff date. (Pugsley . Commissioner, Jan. 2)