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Daily Court Reporter - News Supreme Court of Ohio heard oral arguments this month, including one examining a state Law which mandates transfer agreements with hospitals

 

Supreme Court of Ohio heard oral arguments this month, including one examining a state Law which mandates transfer agreements with hospitals

Kathleen Maloney, Supreme Court of Ohio

The Ohio Supreme Court heard four oral arguments Tuesday, September 12th, including an abortion law dispute involving a statute that requires certain medical facilities to have a transfer agreement with a local hospital for emergencies or medical complication.

Oral Arguments

The four cases considered on Tuesday were streamed live online at sc.ohio.gov and broadcast live on The Ohio Channel.

Summaries Available

Below is a summary of the four arguments heard on Tuesday. Along with the descriptions in this article, the Office of Public Information has released in-depth summaries of the four cases available online at: http://www.courtnewsohio.gov/cases/previews/default.asp#.WJDE73-13x4

Capital Care Network of Toledo v. State of Ohio Department of Health, Case no. 2016-1348

Sixth District Court of Appeals (Lucas County)

ISSUES:

Does Ohio’s administrative rule O.A.C. 3701-83-19(E) validly require ambulatory surgical clinics to have written transfer agreements with hospitals in cases of “medical complications, emergency situations, and for other needs,” and did the Ohio Department of Health director act in accordance with that law?

Did the General Assembly violate the Ohio Constitution’s one-subject clause by using the state budget bill to enact laws for granting ambulatory-surgical-facility licenses?

Can a challenged law be found to be an “undue burden” on abortion rights only if a plaintiff makes a factual and legal showing of such a burden, and did the court find such a burden when the issue wasn’t raised by one of the parties?

Does Ohio law unconstitutionally delegate authority to a third party by requiring all ambulatory surgical facilities to have written transfer agreements with local hospitals in case of emergencies or other needs? According to the law, does the ultimate decision remain with the Ohio Department of Health?

BACKGROUND:

The General Assembly enacted R.C. 3702.30 in 1995 to require the Ohio Department of Health to license “ambulatory surgical facilities” (ASFs), which are free-standing facilities where outpatient surgeries are routinely performed. According to the health department, more than 250 ASFs currently are licensed in Ohio and fewer than a dozen perform abortions.

A 1996 department rule, Ohio Administrative Code 3701-83-19(E), requires that ASFs “shall have a written transfer agreement with a hospital for transfer of patients in the event of medical complications, emergency situations, and for other needs as they arise.”

Capital Care Network of Toledo, an ASF that provides abortions, had a transfer agreement with the University of Toledo Hospital beginning in 2012 and scheduled to expire on July 31, 2013. Also in mid-2013, as part of the state budget bill, the General Assembly changed the laws governing ASFs. The amendments incorporated the department’s transfer agreement rule into the Revised Code and required each ASF to have a transfer agreement “with a local hospital that specifies an effective procedure for the safe and immediate transfer of patients ….” A law also was enacted that barred public hospitals from making transfer agreements with clinics that do abortions. As a public hospital, the University of Toledo Hospital was prohibited from entering into further transfer agreements with Capital Care. These statutes regarding ASFs took effect on Sept. 29, 2013.

When Capital Care didn’t submit a new transfer agreement to the health department, the department sent a notice to the clinic, dated Aug. 2, proposing to revoke its license for failing to follow the department’s administrative rule. (The new statutes weren’t yet in effect.) In January 2014, Capital Care secured a transfer agreement with the University of Michigan Health System in Ann Arbor, Michigan, 52 miles from the clinic. The department sent another notice, dated Feb. 14, 2014, stating that Capital Care hadn’t complied with the rule or the new transfer agreement statute because the law mandated a transfer agreement with a “local” hospital. Following a hearing with the clinic, the department decided that the Ann Arbor hospital was too far away and revoked the clinic’s license.

Capital Care appealed to the Lucas County Common Pleas Court. The court determined in its June 2015 opinion that the transfer agreement statute, as well as related statutes governing the activities of public hospitals and the issuance of variances from the transfer agreement were unconstitutional because they violated the Ohio Constitution’s provision restricting legislation to one subject. The court also concluded that the transfer-agreement law placed an undue burden on women seeking abortions, based on federal standards, because the laws were an unconstitutional delegation of the state’s licensing authority to private hospitals.

The health department filed an appeal with the Sixth District Court of Appeals, which in July 2016 upheld the common pleas court’s ruling. The Sixth District cited the U.S. Supreme Court’s decision in Whole Woman’s Health v. Hellerstedt, which was issued the month before, on June 27, 2016. The Ohio Supreme Court accepted the department’s appeal of the Sixth District’s decision to review the issues.

In re D.H., Case no. 2016-1195

Second District Court of Appeals (Montgomery County)

ISSUES:

Is a juvenile court order transferring jurisdiction of a minor to common pleas court a final order that can be appealed before proceedings in common pleas court begin?

Does a 1974 Ohio Supreme Court decision declaring that a discretionary transfer of a juvenile isn’t a final, appealable order apply since the Ohio General Assembly subsequently amended R.C. 2505.02?

BACKGROUND:

In June 2014, a minor identified in court records as “D.H.” participated in a street crime known as “the knock-out game.” He allegedly struck two homeless men and took their property. There was no evidence the victims required medical attention or incurred medical expenses. D.H. was charged with two counts of robbery if it were a crime committed by an adult. D.H. hadn’t previously been adjudicated as a delinquent in juvenile court and never served any time in juvenile detention.

The Montgomery County Prosecutor’s Office requested the case be transferred from the juvenile division of Montgomery County Common Pleas Court to the general division so it could try D.H. as an adult. The juvenile court granted the request, and D.H. was indicted on two counts of robbery. In August 2014, he pleaded no contest, and a month later the trial court sentenced him to four years in prison.

D.H. challenged the discretionary transfer, and in August 2015, the Second District Court of Appeals ruled the juvenile court improperly transferred the case because it didn’t properly explain why it believed there wasn’t enough time to rehabilitate D.H. as a minor in the juvenile system. The prosecutor appealed the decision to the Supreme Court, which in early 2016 decided against hearing it.

The case was remanded to the juvenile court, which didn’t provide time for D.H.’s attorneys to make any additional arguments for treating him as a minor. The juvenile court again ruled D.H. wasn’t amenable to treatment, and in March 2016, transferred the case to adult court. D.H. appealed the juvenile court’s order. The prosecutor asked the Second District to dismiss the case, relying on the Ohio Supreme Court’s 1974 In re: Becker decision, which indicated the transfer order can’t be appealed and a juvenile must wait until after a conviction by the common pleas court to appeal. D.H. argued that since Becker the legislature amended R.C. 2505.02 to allow a transfer decision to be appealed under certain conditions. D.H. argued he met the conditions. In July 2016, the Second District sided with the prosecutor, noting the Supreme Court hasn’t declared that Becker has been affected by the changes in state law. D.H. appealed to the Supreme Court, which agreed to hear the case.

Frank and London Insurance Agency v. LGR Realty Inc., Case no. 2016-1307

Tenth District Court of Appeals (Franklin County)

ISSUE:

Does the four-year statute of limitations for filing a professional negligence claim against an insurance agent start when the wrongful act is committed, or when a claim is denied and the policyholder discovers the error?

BACKGROUND:

LGR Realty purchased insurance protection for its real estate practice through its agent, Frank and London Insurance Agency. Frank and London secured a policy for LGR from Continental Casualty that took effect in May 2010. LGR was sued in early 2011 for its role in a disputed property purchase, and turned to Continental Casualty to provide its legal defense and pay any claim against it. The insurer denied the claim in April 2011, and LGR asserted that Frank and London negligently failed to procure the proper coverage and misrepresented the coverage in place. LGR estimated it spent more than $420,000 of its own funds to successfully defend itself in the lawsuit.

LGR filed a lawsuit against Frank and London in April 2015, more than four years after the 2010 purchase of the coverage. Frank and London sought to dismiss the case, asserting LGR filed its suit after the four-year statute of limitations in R.C. 2305.09(D). The trial court agreed, and LGR appealed to the Tenth District Court of Appeals.

The Tenth District reversed the trial court’s decision, writing that one of the exceptions to the law’s four-year time limit is for “delayed-damages.” Under the delayed-damages exception, the appellate court ruled the statute of limitations begins to run from the time the claim of professional negligence caused LGR harm, which was in April 2011 when coverage was denied. It ruled the suit was filed on time.

Frank and London appealed to the Supreme Court, which agreed to hear the case.

Disciplinary Counsel v. Brian Allan Maciak, Case no. 2017-0492

Palm Beach County, Fla.

ISSUE:

The Office of the Disciplinary Counsel charged Maciak with multiple violations of professional conduct rules related to his activities as general counsel for two large corporations, one headquartered in Texas and another in Florida. A three-member panel of the professional conduct board found Maciak committed rule violations for practicing law in Florida without obtaining the required authorized house counsel certification, and engaging in the practice of law from 2012 to 2015 while under suspension by the Ohio Supreme Court. Maciak’s suspensions were based on his failure to complete and report mandatory continuing legal education (CLE).

The Board of Professional Conduct recommends that Florida attorney Brian A. Maciak be suspended from the practice of law in Ohio for two years, with the suspension fully stayed with conditions.

BACKGROUND:

Maciak formerly practiced with two Cleveland law firms and served as an executive and attorney for National City Bank in Cleveland. In 2006, he relocated to Texas to become vice president and assistant general counsel of Michaels Stores, Inc. He left the company, and was hired in 2009 as general counsel for TBC Retail Group in Florida. In 2012, he was promoted to TBC’s senior vice president and general counsel. TBC is the holding company for a variety of automotive retailers including Midas Muffler, National Tire and Battery, and Tire Kingdom.

At Michaels and TBC, Maciak’s duties centered as much on business as on law, and he testified that most of his time was devoted to “nonlegal functions.” He stated his role is primarily to oversee the in-house legal teams, but periodically provided legal advice and counsel to TBC.

In 2015, Jeffery Picker of the Florida Bar Association’s unauthorized practice of law department received a complaint from a former TBC employee about Maciak. Picker noted Maciak was neither a Florida Bar member nor certified as authorized house counsel. A lawyer must be one of the two to serve as general counsel for a Florida company.

Maciak applied for and was granted authorized status in late 2015. The complaint also accused Maciak of practicing law without a license and Ohio’s disciplinary counsel was notified. The disciplinary counsel contacted Maciak and notified him that he has been ineligible to practice law in Ohio since December 2011 and inquired about his activities in Florida.

Maciak was suspended from practicing in Ohio in December 2007 for failing to register, but was reinstated a month later. He was sanctioned twice for failure to complete CLE. He was fined $320 for the first violation in 2009 and $680 for the second in 2011. He was suspended until he paid both fines and completed his CLE requirements. He was reinstated in November 2015, about one month after receiving the disciplinary counsel’s inquiry.

In 2016, the disciplinary counsel charged Maciak with several rule violations, including practicing law in another jurisdiction (Florida) in violation of Florida rules. He also was charged with practicing law in Texas and Florida from 2009 to 2015 while under suspension in Ohio, and with making false statements and misrepresentations during the disciplinary investigation.

The disciplinary counsel argues that if Maciak receives a fully stayed suspension, his sanction would be far less severe than what the Court has imposed on an applicant for the bar and a lay person found to have engaged in the unauthorized practice of law. The disciplinary counsel also cautions that adopting the board’s recommendation “would effectively reward those attorneys who choose to remain ignorant of their license status and who simply proclaim ignorance or a poor memory when confronted with evidence contradicting the misrepresentations” made while under investigation.

Date Published: September 21, 2017

 

Supreme Court of Ohio

 

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