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McKenna Law Update & News – October 2015

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In This Issue...

STATUTE OF LIMITATION FOR WRONGFUL DEATH – DATE OF DISCOVERY OF INJURY OR DEATH

At least one Illinois Appellate Court has now taken the position that the two-year statute of limitation for wrongful death actions begins to run on the date that the Plaintiff knew or should have known of the date of death of Plaintiff’s decedent – not the date when the Plaintiff knew or should have known that the injury and death was wrongfully caused. Ninety-year-old Kathryn Moon was admitted to the hospital in May 18, 2009. During Kathryn's hospitalization, she underwent surgery and experienced numerous complications including labored breathing, pain, fluid overload, pulmonary infiltrates, and pneumo-peritoneum. Kathryn also underwent CT scans, which a radiologist read and allegedly misinterpreted. She died on May 29, 2009. On May 10, 2011, plaintiff filed a medical negligence action against two of the treating physicians. Thereafter, on March 18, 2013, almost four years after Plaintiff’s decedent’s death, the plaintiff filed both wrongful death and survival claims against the radiologists. The radiology defendants filed a motion to dismiss, arguing that the two-year statutes of limitations for both wrongful death and survival actions had expired. Alternatively, defendants argued that even if the discovery rule applied, the complaint was nevertheless untimely filed under the discovery rule. The trial court granted defendants' motion to dismiss and found that the date of Kathryn's death was the "date from which the two-year statute should be measured." The Court further stated that "even if we give everybody the benefit of the doubt and try to fix a date at which a reasonable person was placed on inquiry as to whether there was malpractice, even that was long gone by the time the complaint was filed." The Third District Appellate Court in Moon v. Rhode, 2015 IL App (3d) 130613 (2015) agreed. The Appellate Court determined that the Wrongful Death Act, “clearly provided that a claimant must file a wrongful death action within two years from the date on which the claimant knew, or through the use of reasonable diligence should have known, or received notice in writing of the existence of the injury or death for which damages are sought in the action, whichever of such date occurs first. 735 ILCS 5/13-212(a). The required knowledge is of the death or injury, not of the negligent conduct. If the General Assembly wanted to provide a limitations period in the Act commencing when one had knowledge of the negligent conduct, it would have done so.” In so ruling, the Appellate Court declined to follow cases decided in both the First District and Second Districts, which had held that where a wrongful death claim is predicated upon a claim of medical malpractice not apparent to the plaintiff at the time of death, the statute of limitations applicable to medical malpractice actions governed the time for filing. The Third District stated that the First and Second District Courts read into section 13-212(a) language "which is clearly not there." The Illinois Supreme Court has not ruled on this issue; however, based on its rulings in other cases, if presented with this issue it will most likely follow the Third District decision. In a prior decision, Wyness v. Armstrong World Industries, Inc., 131 Ill.2d 403, 416, 546 N.E.2d 568 (1989), the Illinois Supreme Court held that the discovery rule does not alter the fact that the Wrongful Death Act created a new cause of action for death, that it will strictly construe a statute that is in derogation of the common law, and that the general legislature is capable of drafting statutes of limitation if so inclined. For further information contact Kristin Tauras at 312.558.3923 or ktauras@104.236.6.34 Return to Issues Menu  

LIABILITY OF SELF INSURED RENTAL CAR COMPANIES LIMITED TO SAME MINIMUM COVERAGE REQUIREMENT AS COMPANIES THAT PURCHASE INSURANCE

The Illinois Supreme Court upheld a 10 year old Appellate Court decision in finding that the liability of rental car companies that obtain a certificate of self insurance from the Secretary of State is limited to the same minimum coverage provisions that apply to rental car companies that purchase insurance policies. In Nelson v. Artley, the plaintiff, Nelson, was injured by an Enterprise rental car driven by defendant, Artley, who was uninsured. Nelson obtained a default judgment of $600,000 against Artley and brought a supplemental action against Enterprise. Enterprise argued that because it was self insured, its total financial responsibility per occurrence was the statutory minimum coverage requirement of $100,000. The Circuit Court agreed and the plaintiff appealed. The First District Appellate Court reversed, rejecting the 2005 Fellhauer decision. It held that where a rental car company elects to meet Illinois’ mandatory liability insurance requirements by obtaining a certificate of self-insurance, the company is obligated to pay the full amount of judgments entered against drivers of its vehicles. In reversing the First District, the Supreme Court analyzed Section 7-601(a) of the Illinois Safety and Family Financial Responsibility Law which mandates liability insurance coverage for motor vehicles used on a public highway. The Court agreed with the reasoning in the Fellhauer decision that the insurance provision requires only certain minimum levels of coverage and not full payment for losses. The same is true of the special financial responsibility provision enacted for owners of for-rent vehicles. The statute simply insures that an injured person will have some coverage when otherwise there would be none. For further information, contact Dawn Ehrenberg at 312.558.3933 or dehrenberg@104.236.6.34. Return to Issues Menu  

RESORT OWNER NOT LIABLE TO PATRON WHO BROKE HIS NECK DIVING INTO A LAKE

In Bujnowski v. Birchland, Inc., the plaintiff, a 6 foot 4 inch tall man, who had previously been to the defendant’s resort, dived off a pier into a lake and struck his head on the bottom, resulting in a broken neck. In the subsequent lawsuit, the defendant was granted summary judgment on the basis that the danger of diving into the water was open and obvious. The plaintiff testified that he had been to the resort twice before and had not seen any signs indicating the water’s depth, that he had no idea how deep the water was and never asked anyone about it. He knew that the water level in lakes could fluctuate, but he had seen others doing flat dives into this lake and assumed it was deep enough. The Appellate Court reviewed a number of cases which had been decided both before and after the enactment of the Premises Liability Act of 1984 and agreed that the open and obvious rule applies to diving into water, not because the plaintiff knows in advance that the water is shallow, but because he knows it is a body of water and thus might be too shallow for a safe dive. The adage “look before you leap” applies and the law requires more than just looking. The Court rejected plaintiff’s argument that the defendant’s building of a pier changed the nature of the danger, made the water look deeper and created a new risk. The Court reviewed the facts to determine whether an exception to the open and obvious rule applied, such as distraction, but found none. The Court noted that it had not found any published cases where a court found the open and obvious rule applied without an exception but then also found that the defendant still owed a duty to the plaintiff. Essentially the last two factors in the analysis – the burden on the defendant of guarding against an injury and the consequences of placing that burden on the defendant – become irrelevant once no exception to the open and obvious rule is found. For further information, contact Dawn Ehrenberg at 312.558.3933 or dehrenberg@104.236.6.34. Return to Issues Menu

NEIMAN MARCUS DATA BREACH ACTION: CUSTOMERS HAVE STANDING TO PURSUE CLAIM

The United States Court of Appeals for the Seventh Circuit reversed the District Court and found that plaintiffs, customers of Neiman Marcus, have standing to pursue claims resulting from a 2013 data breach of Neiman Marcus’ computer system. Remijas v. Neiman Marcus Group, No. 14-3122 (7th Cir. 2015). In 2013, hackers stole credit card numbers from the computer system of luxury department store Neiman Marcus. Neiman Marcus confirmed that between July 2013 and October 2013, approximately 350,000 credit cards had been exposed to hackers’ malware. Numerous class-action complaints were filed, which were consolidated into one action in the Northern District of Illinois. Neiman Marcus moved to dismiss the complaint for lack of standing and for failure to state a claim. The District Court granted the motion exclusively on standing grounds. The Seventh Circuit reversed that decision, finding that the plaintiffs satisfied the requirements for Article III standing, which include alleging a particularized injury, that defendant caused the injury, and that a judicial decision can provide redress for that injury. First, the Court found that the plaintiffs suffered sufficient present and future injuries. Approximately 9,200 customers already experienced fraudulent charges, and although they were reimbursed for these charges, the Court determined that the cost associated with sorting out the charges represented a sufficient injury. Additionally, the Court determined that there is a concrete risk of future injury for the members of the class that had not yet experienced fraudulent charges or identity theft. In data breach cases, a substantial risk of future harm may be sufficient to support Article III standing. The Court found that following a data breach, there is an objectively reasonable likelihood that credit card fraud and identity theft will occur, especially in cases where fraudulent charges have already been documented. Also, the Court noted that Neiman Marcus’ offer of credit monitoring and identity protection would not have been necessary if the risk of harm was so minimal that it can be disregarded. Second, the Court found that, for the purposes of determining standing, the plaintiffs’ injuries were caused by the Neiman Marcus data breach. The Court stated that while it may be possible that plaintiffs’ private information may have been exposed through a different source, it is plausible for pleading purposes that plaintiffs’ injuries are fairly traceable to the data breach at Neiman Marcus. The fact that Neiman Marcus admitted that 350,000 cards were exposed and contacted members of the class to tell them they were at risk, was further support for plaintiffs’ position. Finally, the Court rejected Neiman Marcus’ argument that plaintiffs’ injuries could not be redressed by a judicial decision. The Court found that a favorable judicial decision could redress any injuries caused by less than full reimbursement of unauthorized charges. For further information contact Alex Sweis at 312.558.3994 or asweis@104.236.6.34. Return to Issues Menu
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