Justia Alabama Supreme Court Opinion Summaries

Employee-shareholders Steven Nichols, Deborah Deavours, Terry Akers, Thomas Dryden, and Gary Evans appealed a circuit court’s dismissal of their action against HealthSouth Corporation ("HealthSouth"). The employee shareholders at one time were all HealthSouth employees and holders of HealthSouth stock. In 2003, the employee shareholders sued HealthSouth, Richard Scrushy, Weston Smith, William Owens, and the accounting firm Ernst & Young, alleging fraud and negligence. The action was delayed for 11 years for a variety of reasons, including a stay imposed until related criminal prosecutions were completed and a stay imposed pending the resolution of federal and state class actions. In their original complaint (and in several subsequent amended complaints) the employee shareholders alleged that HealthSouth and several of its executive officers mislead investors by filing false financial statements of HealthSouth from 1987 forward. When the employee shareholders filed their action, the Alabama Supreme Court's precedent held: (1) that "[n]either Rule 23.1[, Ala. R. Civ. P.,] nor any other provision of Alabama law required stockholders' causes of action that involve the conduct of officers, directors, agents, and employees be brought only in a derivative action," and (2) that claims by shareholders against a corporation alleging "fraud, intentional misrepresentations and omissions of material facts, suppression, conspiracy to defraud, and breach of fiduciary duty" "do not seek compensation for injury to the [corporation] as a result of negligence or mismanagement," and therefore "are not derivative in nature." In the present case, the Alabama Supreme Court concluded the employee shareholders' claims were direct rather than derivative and that, the trial court erred in dismissing the employee shareholders' claims for failure to comply with Rule 23.1, Ala. R. Civ. P. Furthermore, the Court found employee shareholders' eighth amended complaint related back to their original complaint and thus the claims asserted therein were not barred by the statute of limitations. Accordingly, the judgment of the trial court was reversed and the cause remanded for further proceedings. View "Nichols v. HealthSouth Corporation" on Justia Law

Employee-shareholders Steven Nichols, Deborah Deavours, Terry Akers, Thomas Dryden, and Gary Evans appealed a circuit court’s dismissal of their action against HealthSouth Corporation ("HealthSouth"). The employee shareholders at one time were all HealthSouth employees and holders of HealthSouth stock. In 2003, the employee shareholders sued HealthSouth, Richard Scrushy, Weston Smith, William Owens, and the accounting firm Ernst & Young, alleging fraud and negligence. The action was delayed for 11 years for a variety of reasons, including a stay imposed until related criminal prosecutions were completed and a stay imposed pending the resolution of federal and state class actions. In their original complaint (and in several subsequent amended complaints) the employee shareholders alleged that HealthSouth and several of its executive officers mislead investors by filing false financial statements of HealthSouth from 1987 forward. When the employee shareholders filed their action, the Alabama Supreme Court's precedent held: (1) that "[n]either Rule 23.1[, Ala. R. Civ. P.,] nor any other provision of Alabama law required stockholders' causes of action that involve the conduct of officers, directors, agents, and employees be brought only in a derivative action," and (2) that claims by shareholders against a corporation alleging "fraud, intentional misrepresentations and omissions of material facts, suppression, conspiracy to defraud, and breach of fiduciary duty" "do not seek compensation for injury to the [corporation] as a result of negligence or mismanagement," and therefore "are not derivative in nature." In the present case, the Alabama Supreme Court concluded the employee shareholders' claims were direct rather than derivative and that, the trial court erred in dismissing the employee shareholders' claims for failure to comply with Rule 23.1, Ala. R. Civ. P. Furthermore, the Court found employee shareholders' eighth amended complaint related back to their original complaint and thus the claims asserted therein were not barred by the statute of limitations. Accordingly, the judgment of the trial court was reversed and the cause remanded for further proceedings. View "Nichols v. HealthSouth Corporation" on Justia Law

Larry Curry appealed the dismissal of his lawsuit against Gable Miller, Jr., and Auto Owners Insurance Company ("Auto Owners") on the ground of failure to prosecute. In 2014, Curry was injured when the vehicle in which he was driving was struck from the rear by a vehicle being driven by Miller. Curry retained attorney Russell Johnson to represent him in the matter. Johnson, on Curry's behalf, filed a personal-injury action against Miller. Johnson’s claim against Auto Owners sought uninsured/underinsured-motorist benefits. In 2017, the trial court set the case for a bench trial. At some point Curry's relationship with Johnson began to deteriorate, and Curry terminated Johnson's employment. On April 3, 2017, the trial court granted Johnson's motion to withdraw. On the same day, Johnson filed with the trial court a lien for attorney fees and expenses. Johnson stated in the lien that, during his representation of Curry, Miller had made an offer to settle Curry's claims for $17,000; that Curry had accepted the offer to settle but had refused to sign the necessary releases; and that Johnson had filed the personal-injury action on Curry's behalf to prevent Curry's claims from being barred by the statute of limitations. The trial court entered an order stating that the status conference had been held on April 11, 2017; that defense counsel had attended the conference; that Curry failed to appear at the conference; and that Curry was to notify the court within 30 days of his intention either to proceed pro se or to retain counsel. The order further stated that failure to comply with the order could result in sanctions, including dismissal of the lawsuit. On the same day, the trial court rescheduled the bench trial. On May 19, 2017, Miller and Auto Owners moved to dismiss Curry's claims for failure to prosecute, asserting that Curry had not attended the April 11, 2017, status conference and had not complied with the trial court's subsequent orders. The trial court deferred ruling on the defendants' motion to dismiss for one week to give Curry ample opportunity to respond. Curry failed to respond, and the trial court entered an order dismissing, with prejudice, Curry's lawsuit against the defendants. The Alabama Supreme Court affirmed this outcome, finding Curry simply offered the trial court no plausible explanation as to why, out of all the documents mailed to him at his address, he would have received only one of those documents: defense counsel's motion to dismiss the action for want of prosecution. The trial court had before it sufficient evidence to reject Curry's assertion that he did know that a lawsuit had been filed on his behalf. Accordingly, the trial court did not exceed its discretion in concluding that Curry's failure to prosecute his lawsuit was "willful" for purposes of Rule a 41(b) involuntary dismissal. View "Curry v. Miller" on Justia Law

Larry Curry appealed the dismissal of his lawsuit against Gable Miller, Jr., and Auto Owners Insurance Company ("Auto Owners") on the ground of failure to prosecute. In 2014, Curry was injured when the vehicle in which he was driving was struck from the rear by a vehicle being driven by Miller. Curry retained attorney Russell Johnson to represent him in the matter. Johnson, on Curry's behalf, filed a personal-injury action against Miller. Johnson’s claim against Auto Owners sought uninsured/underinsured-motorist benefits. In 2017, the trial court set the case for a bench trial. At some point Curry's relationship with Johnson began to deteriorate, and Curry terminated Johnson's employment. On April 3, 2017, the trial court granted Johnson's motion to withdraw. On the same day, Johnson filed with the trial court a lien for attorney fees and expenses. Johnson stated in the lien that, during his representation of Curry, Miller had made an offer to settle Curry's claims for $17,000; that Curry had accepted the offer to settle but had refused to sign the necessary releases; and that Johnson had filed the personal-injury action on Curry's behalf to prevent Curry's claims from being barred by the statute of limitations. The trial court entered an order stating that the status conference had been held on April 11, 2017; that defense counsel had attended the conference; that Curry failed to appear at the conference; and that Curry was to notify the court within 30 days of his intention either to proceed pro se or to retain counsel. The order further stated that failure to comply with the order could result in sanctions, including dismissal of the lawsuit. On the same day, the trial court rescheduled the bench trial. On May 19, 2017, Miller and Auto Owners moved to dismiss Curry's claims for failure to prosecute, asserting that Curry had not attended the April 11, 2017, status conference and had not complied with the trial court's subsequent orders. The trial court deferred ruling on the defendants' motion to dismiss for one week to give Curry ample opportunity to respond. Curry failed to respond, and the trial court entered an order dismissing, with prejudice, Curry's lawsuit against the defendants. The Alabama Supreme Court affirmed this outcome, finding Curry simply offered the trial court no plausible explanation as to why, out of all the documents mailed to him at his address, he would have received only one of those documents: defense counsel's motion to dismiss the action for want of prosecution. The trial court had before it sufficient evidence to reject Curry's assertion that he did know that a lawsuit had been filed on his behalf. Accordingly, the trial court did not exceed its discretion in concluding that Curry's failure to prosecute his lawsuit was "willful" for purposes of Rule a 41(b) involuntary dismissal. View "Curry v. Miller" on Justia Law

Bridgestone Americas Tire Operations, LLC, d/b/a GCR Tires & Service ("Bridgestone"), appealed a circuit court order denying Bridgestone's motion to compel arbitration of an employment-related dispute. Ottis Adams began working as a sales representative for Bridgestone or a related entity in May 2006 and that he resigned or his employment was terminated in August 2016. At some point at or around the time he was hired, Adams signed a document entitled "New Employee Agreement and Acknowledgment of the Bridgestone/Firestone, Inc. Employee Dispute Resolution Plan" ("the agreement"), which stated that Adams agreed to the terms of the employee-dispute-resolution plan, fully titled, the "BFS Retail & Commercial Operations, LLC, Employee Dispute Resolution Plan" ("the EDR Plan"). The EDR Plan contained an arbitration provision. After leaving Bridgestone in 2016, Adams went to work for McGriff Tire Company, Inc. ("McGriff"). At some point thereafter, McGriff's principal, Barry McGriff, received a letter written on the letterhead of Bridgestone's corporate parent, asserting that Adams signed a noncompetition and nonsolicitation agreement with his previous employer, that his employment with McGriff violated that agreement, and that Adams allegedly had violated a duty of loyalty by selling tires for McGriff while still employed by Bridgestone. The letter also suggested that Adams may have disclosed, or might disclose, "confidential information and trade secrets." The letter stated that Bridgestone was planning to commence legal action against Adams and concluded with a suggestion that McGriff might be named as a defendant in that action if the matter was not resolved. Adams asserts that, because of the accusations in the letter, McGriff terminated his employment. Adams sued Bridgestone and related entities, alleging Bridgestone interfered with his business relationship with McGriff and had defamed him via the letter to Barry McGriff. Adams subsequently voluntarily dismissed all defendants except Bridgestone. Bridgestone filed an answer and a counterclaim. In its counterclaim, Bridgestone averred that Adams, while still employed by Bridgestone, had taken actions for McGriff's benefit and had "feigned acceptance" of an employment agreement he never actually signed that included a noncompetition provision. Although Bridgestone did not mention arbitration or the EDR Plan in its answer or counterclaim, approximately three months after filing those pleadings, it amended its answer to assert arbitration as a defense, and it filed a motion to compel arbitration of all claims pursuant to the terms of the EDR Plan. The trial court denied Bridgestone's motion to compel, and Bridgestone appealed. After review of the record, the Alabama Supreme Court determined the trial court erred in denying Bridgestone's motion to compel arbitration pursuant to the terms of the EDR Plan. Accordingly, the trial court’s judgment was reversed and the case remanded for further proceedings. View "Bridgestone Americas Tire Operations, LLC v. Adams" on Justia Law

Bridgestone Americas Tire Operations, LLC, d/b/a GCR Tires & Service ("Bridgestone"), appealed a circuit court order denying Bridgestone's motion to compel arbitration of an employment-related dispute. Ottis Adams began working as a sales representative for Bridgestone or a related entity in May 2006 and that he resigned or his employment was terminated in August 2016. At some point at or around the time he was hired, Adams signed a document entitled "New Employee Agreement and Acknowledgment of the Bridgestone/Firestone, Inc. Employee Dispute Resolution Plan" ("the agreement"), which stated that Adams agreed to the terms of the employee-dispute-resolution plan, fully titled, the "BFS Retail & Commercial Operations, LLC, Employee Dispute Resolution Plan" ("the EDR Plan"). The EDR Plan contained an arbitration provision. After leaving Bridgestone in 2016, Adams went to work for McGriff Tire Company, Inc. ("McGriff"). At some point thereafter, McGriff's principal, Barry McGriff, received a letter written on the letterhead of Bridgestone's corporate parent, asserting that Adams signed a noncompetition and nonsolicitation agreement with his previous employer, that his employment with McGriff violated that agreement, and that Adams allegedly had violated a duty of loyalty by selling tires for McGriff while still employed by Bridgestone. The letter also suggested that Adams may have disclosed, or might disclose, "confidential information and trade secrets." The letter stated that Bridgestone was planning to commence legal action against Adams and concluded with a suggestion that McGriff might be named as a defendant in that action if the matter was not resolved. Adams asserts that, because of the accusations in the letter, McGriff terminated his employment. Adams sued Bridgestone and related entities, alleging Bridgestone interfered with his business relationship with McGriff and had defamed him via the letter to Barry McGriff. Adams subsequently voluntarily dismissed all defendants except Bridgestone. Bridgestone filed an answer and a counterclaim. In its counterclaim, Bridgestone averred that Adams, while still employed by Bridgestone, had taken actions for McGriff's benefit and had "feigned acceptance" of an employment agreement he never actually signed that included a noncompetition provision. Although Bridgestone did not mention arbitration or the EDR Plan in its answer or counterclaim, approximately three months after filing those pleadings, it amended its answer to assert arbitration as a defense, and it filed a motion to compel arbitration of all claims pursuant to the terms of the EDR Plan. The trial court denied Bridgestone's motion to compel, and Bridgestone appealed. After review of the record, the Alabama Supreme Court determined the trial court erred in denying Bridgestone's motion to compel arbitration pursuant to the terms of the EDR Plan. Accordingly, the trial court’s judgment was reversed and the case remanded for further proceedings. View "Bridgestone Americas Tire Operations, LLC v. Adams" on Justia Law

Amy Langley Hamilton appealed a judgment entered in favor of Warren Scott, M.D., and the Isbell Medical Group, P.C. ("IMG"), following a jury trial on Hamilton's claim alleging the wrongful death of her stillborn son Tristian. In the first appeal, Hamilton v. Scott, 97 So. 3d 728 (Ala. 2012) ("Hamilton I"), the Alabama Supreme Court reversed in part a summary judgment entered against Hamilton because it concluded that Hamilton was entitled to pursue a wrongful-death claim regarding her unborn son even though the child was not viable at the time of his death. It was undisputed that the trial court's charges to the jury did not include the "better-position" principle. "That legal principle goes to the heart of Hamilton's theory of the case, i.e., that Dr. Scott's failure to refer Hamilton to a perinatologist during Hamilton's February 25, 2005, visit prevented timely treatment that, according to Dr. Bruner's testimony, would have saved Tristian's life." Consequently, the Supreme Court held the trial court's refusal to give such instructions constituted reversible error. View "Hamilton v. Scott" on Justia Law

Amy Langley Hamilton appealed a judgment entered in favor of Warren Scott, M.D., and the Isbell Medical Group, P.C. ("IMG"), following a jury trial on Hamilton's claim alleging the wrongful death of her stillborn son Tristian. In the first appeal, Hamilton v. Scott, 97 So. 3d 728 (Ala. 2012) ("Hamilton I"), the Alabama Supreme Court reversed in part a summary judgment entered against Hamilton because it concluded that Hamilton was entitled to pursue a wrongful-death claim regarding her unborn son even though the child was not viable at the time of his death. It was undisputed that the trial court's charges to the jury did not include the "better-position" principle. "That legal principle goes to the heart of Hamilton's theory of the case, i.e., that Dr. Scott's failure to refer Hamilton to a perinatologist during Hamilton's February 25, 2005, visit prevented timely treatment that, according to Dr. Bruner's testimony, would have saved Tristian's life." Consequently, the Supreme Court held the trial court's refusal to give such instructions constituted reversible error. View "Hamilton v. Scott" on Justia Law

Plaintiffs the Walker County Commission and Commissioners Keith Davis, Bobby Nunnelly, Steven Aderhold, and Billy Luster, individually and in their official capacities (referred to collectively as "the Commission"), appealed a circuit court judgment in favor of defendants David Kelly, individually and in his official capacity as chairman of the Walker County Civil Service Board, and board members Rufus Reed, Donald Baxter, Raymond Bennett, and Gary Davis, individually (referred to collectively as "the Board"), the defendants below. The Supreme Court concluded that the Commission filed this action seeking to get clarification, or an advisory opinion, as to whether the Board would be bound by the Open Meetings Act in the future. Because there was no justiciable controversy and the Commission sought only an advisory opinion in its complaint, the circuit court did not have subject-matter jurisdiction over this action. Accordingly, the Supreme Court dismissed this appeal with instructions that the circuit court vacate its judgment and dismiss the case, without prejudice. View "Walker County Commission et al. v. Kelly et al." on Justia Law

Plaintiffs the Walker County Commission and Commissioners Keith Davis, Bobby Nunnelly, Steven Aderhold, and Billy Luster, individually and in their official capacities (referred to collectively as "the Commission"), appealed a circuit court judgment in favor of defendants David Kelly, individually and in his official capacity as chairman of the Walker County Civil Service Board, and board members Rufus Reed, Donald Baxter, Raymond Bennett, and Gary Davis, individually (referred to collectively as "the Board"), the defendants below. The Supreme Court concluded that the Commission filed this action seeking to get clarification, or an advisory opinion, as to whether the Board would be bound by the Open Meetings Act in the future. Because there was no justiciable controversy and the Commission sought only an advisory opinion in its complaint, the circuit court did not have subject-matter jurisdiction over this action. Accordingly, the Supreme Court dismissed this appeal with instructions that the circuit court vacate its judgment and dismiss the case, without prejudice. View "Walker County Commission et al. v. Kelly et al." on Justia Law