Legal Report January 2006

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U.S. JUDICIAL DECISIONS

NEGLIGENT HIRING. An Illinois appellate court has ruled that a national organization established to help children cannot be held responsible for the sexual abuse of a child at its Chicago location. The court ruled that the organization had no responsibility to protect children from harm.

In August 1998, Philip Kaszynski was accepted as a volunteer for Big Brothers Big Sisters of Metropolitan Chicago, referred to as “Chicago.” In 1999, a mother—identified as Jane Doe in court documents—enrolled her 10-year-old son John in the Big Brothers Big Sisters program. John was grieving after the death of his grandfather, and his counselor thought that a mentor might help. In November 2000, Kaszynski was matched with John. Kaszynski sexually abused John until March 2002, when he was arrested for sexually abusing several children and possessing child pornography.

Doe filed a lawsuit against Chicago and Big Brothers Big Sisters of America (referred to as “America”), which grants its name and support to the Chicago affiliate. The suit charged America with negligent hiring and supervision. (The two cases were severed and this decision applies only to the lawsuit against America.)

Doe argued that America had a special duty to protect John from harm. For example, Doe noted that America has developed a standard intake process for volunteers that its affiliates, like Chicago, are supposed to implement. The standards provided that an affiliate staff member would conduct an in-person interview to determine whether volunteers were able to meet a child’s mentoring needs. The process also was to include an application, references, criminal history check, and a home environment assessment. Doe argued that the existence of these standards meant that the local affiliate was required by America to ensure John’s safety.

America filed a request for summary judgment—a hearing based on the facts of a case, without a trial. In the request, the organization claimed that it had no special duty to protect John from the criminal acts of a third party and that it had no day-today oversight of the Chicago affiliate. The Circuit Court of Cook County agreed with the defendants and granted the summary judgment. Doe appealed the decision.

The Illinois Court of Appeals for the Second Circuit upheld the summary judgment. The court ruled that the organization’s procedures were suggestions only and that Chicago decided whether or not to use them. Further, the court found that America did not require Chicago to adopt any child-protection or sexual-abuse-prevention policies, so it was not responsible for Chicago’s decision not to adopt such policies. (Doe v. Big Brothers Big Sisters of America, Illinois Appeals Court, Second Division, No. 1-04-1985, 2005)

PREMISES LIABILITY. The California Supreme Court has ruled that a restaurant patron who was assaulted in the parking lot can pursue a premises liability claim against the restaurant owner.

Silvino De La Torre owns and operates Victoria’s Mexican Food, a restaurant located in a small shopping center in San Diego. At the time, five other businesses, all with daytime hours, were situated in the shopping center along with Victoria’s, which operated 24 hours a day. The businesses shared the parking area, and De La Torre paid 20 percent of the maintenance costs for the parking lot.

The restaurant had a storefront made of plate glass windows that allowed patrons to look out on the parking lot. A kitchen area, which housed a private telephone, was located at the back of the restaurant behind a waist-high countertop.

On August 1, 2000, at approximately 1:00 a.m., a group of five friends arrived by car and parked in the parking lot in front of the restaurant. Three of them went into Victoria’s to get food while the other two, one of whom was Charles E. Morris, waited outside.

Two local gang members, Richard Cuevas and Saul De La Vega, drove into the parking lot. They began menacing Morris. Cuevas asked where Morris lived. When Morris said “Imperial Beach,” Cuevas punched him in the chest. Morris’s three friends came out of the restaurant and the group began fighting with Cuevas and De La Vega.

Cuevas ran into Victoria’s and demanded that someone in the kitchen give him a knife. The account of the incident varies at this point. Cuevas claims that the staff let him into the kitchen area, where he grabbed a knife. Restaurant employees claim that Cuevas forced his way to the back of the restaurant and took the knife from unwilling employees. In either case, Cuevas obtained the knife and ran back out into the parking lot.

Cuevas ran Morris down about 25 feet from Victoria’s front window and, in plain view of the restaurant’s patrons and staff, stabbed Morris twice. Cuevas then turned to Morris’s friends, who ran to a nearby fast food restaurant and called 911. While Cuevas was distracted, Morris struggled to his feet and attempted to escape. Cuevas slashed the tires on Morris’s car and then returned to his car and drove off in search of Morris. Cuevas found him on a nearby sidewalk and stabbed him two more times. At this point, police and emergency medical personnel arrived in response to the 911 call made from the fast food restaurant. Cuevas fled on foot. He was eventually found and arrested six months later.

The entire incident, from the beginning of the fight to the arrival of authorities, took approximately eight minutes. During this time, none of Victoria’s three employees telephoned the police or anyone else for help. Morris was rushed to hospital suffering from life-threatening wounds.

Morris sued De La Torre for negligence under the legal theory of premises liability. Morris argued that De La Torre, as a restaurant owner, had a special relationship with his customers and should have, at minimum, called police.

De La Torre requested summary judgment, arguing that no gang-related activities had previously occurred in the parking lot, so he could not have foreseen the incident. He also claimed that because Morris was in the parking lot and had no intention to enter the restaurant, he was not a customer and, therefore, no special duty existed.

The San Diego County Superior Court granted the summary judgment. Morris appealed the decision.

The California Court of Appeal found that while the Morris had not proved that De La Torre had failed to take preventive action to protect against future events, this did not affect the duty owed to Morris to aid him in the face of an ongoing attack. The court overturned the summary judgment, allowing Morris to proceed with his claim that De La Torre owed him a duty to take reasonable and minimally burdensome measures to help him while he was being assaulted. De La Torre appealed the appellate decision.

The California Supreme Court agreed with the appellate court, finding that Morris could pursue his case. In discussing the case, the court said that Morris was considered a customer even if he was not actually purchasing food, so De La Torre had a special legal duty to protect Morris’s safety. Also, the court noted that placing a 911 call is a well-recognized and minimally burdensome way to render assistance.

In its written opinion of the case, the court addressed the case, saying that: “Our conclusion that defendant owed plaintiff a legal duty of care of course will not prevent defendant from presenting evidence at trial and arguing to a jury that his employees did not in fact breach any duty owed because they acted reasonably in light of their fear that placing a 911 call would endanger their own safety.” (Morris v. Silvino De La Torre, California Supreme Court, No. S119750, 2005)

U.S. CONGRESSIONAL LEGISLATION

TRANSPORTATION SECURITY. The Senate Commerce, Science, and Transportation Committee held hearings on a proposed transportation security bill (S. 1052) that would require the Homeland Security Department to establish a task force to conduct a vulnerability and risk assessment of freight and passenger rail transportation systems. Based on that assessment, the department would then be required to develop specific recommendations for improving rail security.

At the hearing, witnesses discussed the efforts that government agencies had thus far made to improve rail security. Joseph Boardman, administrator for the Federal Railroad Administration, noted that the agency is in the process of developing regulations to secure railroad transport of toxic inhalation hazards. The regulations will ultimately require railroads to improve security plans, identify shipments, provide for temporary storage, ensure tank car integrity, and develop communications and tracking systems.

During the question and answer portion of the hearing, funding was the foremost issue. Committee Chairman Ted Stevens (R-AK), asked why rail passengers were not paying for a portion of the security upgrades through increased fares.

Those testifying at the hearing, including Cathleen Berrick, director of homeland security issues for the Government Accountability Office, said that necessary security upgrades must first be identified and the costs tallied before considering who should pay the tab.

FIRST RESPONDERS. A bill (H.R. 1646) introduced by Rep. Jane Harman (D-CA) would dedicate certain radio frequencies for use by first responders and public service agencies. The Federal Communications Commission would have to dedicate some existing frequencies and assign new frequencies for this use by January 1, 2007. The bill has garnered attention because of the problems federal agencies faced in communicating with each other and with state officials in the aftermath of Hurricane Katrina.

The bill has 23 cosponsors and has been referred to the House Energy and Commerce Committee’s Subcommittee on Telecommunications and the Internet.

IDENTITY THEFT. Several bills that address identity theft are pending in the Senate. One bill (S. 1326), introduced by Sen. Jeff Sessions (R-AL), would require any person or agency that stores or controls sensitive personal information to protect that data from unauthorized access, destruction, use, modification, or disclosure. The bill would also require that any individual whose personal information was compromised be notified. Victims could file a civil lawsuit if they are not informed.

S. 1326 has been approved by the Senate Judiciary Committee and has been placed on the Senate calendar, meaning the Senate has agreed to consider the measure.

Another identity theft bill (S. 1408) is also pending in the Senate. S. 1408, which would set national standards requiring businesses to report data security breaches to customers, has been approved by the Senate Commerce, Science, and Transportation Committee. To advance, it must be taken up by the full Senate.

S. 1408 would apply to businesses and any other organization—such as a school that collects personal information on individuals. (This information includes Social Security numbers, banking information, and driver’s license data.) These groups will be required to secure such information with physical security and technological safeguards that will be set out by the Federal Trade Commission (FTC) through regulations.

Under the measure, if personal information is stolen or lost and affects more than 1,000 individuals, the company holding that information must report the incident to the FTC. Failure to report the breach could result in fines of up to $11,000 per individual affected.

S. 1408 would also allow consumers to put a freeze on their credit report to prevent identity theft from occurring. Individuals could temporarily lift the freeze for their own purposes—if they needed to have a credit check conducted to apply for a mortgage, for example—and then reinstate the freeze. Consumers could request a freeze on their account for any reason.

S. 1408 contains specific language stating that, if it becomes law, it will preempt existing state laws and will, thus, create a uniform system.

A third bill (S. 1789), introduced by Sen. Arlen Specter (R-PA), would enhance penalties for those who use computers to commit identity theft crimes. It would also provide law enforcement officials with more money to investigate and prosecute identity theft.

The bill would require that any business that collects, accesses, transmits, uses, stores, or disposes of sensitive personal information on more than 10,000 people develop a personal data privacy and security program. These programs, to be overseen by the FTC, would be required to address administrative, technical, and physical security.

The security program would be designed to protect against anticipated vulnerabilities to the privacy, security, or integrity of personal electronic records. Companies would also be required to conduct a risk assessment and develop a risk management program.

S. 1789 has been referred to the Senate Judiciary Committee, of which Specter is chairman. The committee has held meetings on the bill but has not acted on it.

STATE LEGISLATION

North Carolina

IDENTITY THEFT. A new law (formerly S.B. 1048) controls how Social Security numbers are collected and distributed by state businesses and government agencies. One provision allows victims of ID theft to put a freeze on their credit with national credit bureaus, making it impossible for criminals to apply for credit in other people’s names.

This column should not be construed as legal or legislative advice.