Federal (Seventh Circuit)

Chain-of-command policy is not an unconstitutional prior restraint.

Tue, 20 Jan 2015 20:33:00 GMT

In a case successfully presented to the United States Court of Appeals for the 7th Circuit by Bullaro & Carton, P.C. on behalf of the LaPorte Community School Corporation and its superintendent and members of the Board of Trustees, it was held that the school’s “chain-of-command” policy was not an unconstitutional prior restraint. Samuelson v. LaPorte Community School Corp., 526 F.3d 1046 (7th Cir. 2008). The plaintiff, a teacher within the school district, alleged that his contract for coaching the high school girls basketball team was not renewed in retaliation for his protected speech, and that the school’s chain-of-command policy was an unconstitutional prior restraint. The trial court granted summary judgment in favor of the defendants, which was upheld on appeal.

As coach, the plaintiff experienced several tumultuous and controversial seasons, which included a physical altercation with a player’s parent, two separate petitions requesting that the Board not renew his contract by members of the team and representatives of families in the community, and an occasion where the team refused to play under his coaching. Following these events, the superintendent provided the plaintiff with a memorandum describing his concerns regarding the plaintiff’s conduct, including his refusal to comply with the school’s chain-of-command policy by taking complaints directly to Board members without first speaking to his supervisors. The memorandum warned that the failure to comply with school policies in the future could result in discipline or termination. Subsequently, the Board voted to not renew the plaintiff’s coaching contract, based on the recommendations of the superintendent, principal, and athletic director. However, the plaintiff alleged that the his non-renewal was actually motivated by a desire to retaliate against him for his voicing of concerns regarding Title IX compliance in the past and his criticism of various school-related issues to individual Board members outside of the school’s chain-of-command policy.

The Court found that the record firmly supported the conclusion that the plaintiff’s coaching contract was not renewed because of the troubled state of the girls’ basketball program, rather than any of the plaintiff’s claimed protected expression. The 7th Circuit went on to hold that the school’s chain-of-command policy, which required staff members to refer “matters requiring administrative action” to a department supervisor before addressing them to the Board, was not an unconstitutional prior restraint. According to the Court, the policy merely addressed unprotected speech regarding the public employee’s professional duties, and did not restrict speech protected by the First Amendment.

School’s chain-of-command policy is not an unconstitutional prior restraint on coach-employee’s speech.

Tue, 20 Jan 2015 20:28:00 GMT

“Known Loss” Not Covered By Policy, Even If Insurer’s Error In Producing Copy Of Policy Was Treated As Modifying Endorsement’s Effective Date:

Tue, 20 Jan 2015 20:17:00 GMT

In a case successfully presented to the United States Court of Appeals for the 7th Circuit by Bullaro & Carton, P.C. on behalf of Erie Insurance Exchange, the 7th Circuit upheld the rule that an insurance policy does not provide coverage for “known losses” unless the parties intend otherwise, despite an unusual set of circumstances involved in the case. In Grey Direct, Inc., v. Erie Insurance Exchange, 2006 WL 2391293 (7th Cir 2006), the insured had been sued for breach of contract in connection with an error in printing travel certificates. The plaintiff, who had been assigned the insured’s rights, filed suit against the insurer, arguing that the error was covered under the insured’s business owners’ policy.

Although the original policy did not cover printing errors at the time of the incident, the insured, in response to the costly mistake, had an endorsement providing such coverage added to the policy about a month after the printing error occurred. The effective date on the amended declaration page issued to the insured reflected that coverage was added after the insured’s printing error. However, the insurer’s practice was to only keep electronically stored copies of its policies. When the insurer’s processor later created a paper copy, it mistakenly indicated that the printing errors endorsement had existed from the beginning of the policy’s coverage period. The plaintiff argued that the mistakenly generated policy was controlling and provided coverage for the insured’s printing error. The 7th Circuit rejected the argument that the processor’s error changed the terms of the contract and found that there was no indication that parties had intended the endorsement to be retroactive in effect.

Interestingly, the 7th Circuit went on to state that even if the erroneously created copy of the policy was treated as “somehow modifying the policy,” coverage for the particular printing error at issue in the case was precluded as a “known loss.” As the Court stated in applying Illinois law, “an insurer has no duty to defend or indemnify the insured with respect to a known loss ab initio, unless the parties intended the known loss to be covered.” The Court explained that “even if we thought that [the processor’s] error had the effect of adding the Printers Errors and Omissions clause to the policy effective [on the date the original policy was issued], it would cover only other unknown events meeting that description, not the [printing error at issue in the case], unless there is evidence that the parties intended also to cover the known loss.”

Chain-of-command policy is not an unconstitutional prior restraint.

Sat, 27 Dec 2014 15:59:00 GMT