Tag: negligence

Federal Court Gives Illinois Primer on Personal Property Torts

The plaintiff in Peco Pallet, Inc. v. Northwest Pallet Supply Co., 2016 WL 5405107 sued a recycling company under various theories after their once harmonious business relationship imploded.

The plaintiff, a wooden pallet manufacturer, instituted a program where it offered to pay pallet recyclers like defendant a specific amount per returned pallet.  When the plaintiff announced it was going to cut the per-pallet payment rate, the defendant recycler balked and refused to return several thousand of plaintiff’s pallets.  The plaintiff sued and the defendant filed counterclaims.

In partially dismissing and sustaining the parties’ various claims, the Court offers a useful refresher on both some common and uncommon legal theories that apply to personal property.

Replevin and Detinue

The Illinois replevin statute, 735 ILCS 5/19-101, allows a plaintiff to try to recover goods wrongfully detained by a defendant.  The statute employs a two-step process involving an initial hearing and a subsequent trial.

Once a replevin suit is filed, the court holds a hearing to determine whether to issue a replevin order.  If at the hearing the plaintiff shows he most likely has a superior right to possession of the disputed property and is likely to prevail at trial, the court enters an order of replevin which requires the defendant release the plaintiff’s property pending the trial.  If the plaintiff later wins at trial, he can recover money damages attributable to the defendant’s wrongful detention of the property.

Closely related to replevin, a detinue claim also seeks the recovery of personal property and damages for its wrongful detention.  Unlike replevin however, there is no preliminary hearing in a detinue case pending final judgment.  Possession remains with the defendant until final judgment.

Since the purpose of the replevin and detinue remedies is the return of personal property, where a defendant returns plaintiff its property, the claims are moot.  Here, since the defendant returned the 17,000 pallets that were subjects of the replevin suit, the Court found that the replevin and detinue claims pertaining to the returned pallets were moot.

The court did allow, however, plaintiff to go forward on its detinue claim for damages related to defendant’s failure to account for some 30,000 pallets.

Conversion

A conversion plaintiff must prove (1) a right to property at issue, (2) an absolute and unconditional right to immediate possession of the property, (3) a demand for possession, and (4) that defendant wrongfully and without authorization, assumed control, dominion or ownership over the property.

The essence of conversion is wrongful deprivation, not wrongful acquisition.  This means that even where a defendant initially possesses property lawfully, if that possession later becomes unauthorized, the plaintiff will have a conversion claim.

Here, the plaintiff alleged that it owned the pallets, that it demanded their return and defendant’s refusal to return them.  These allegations were sufficient to plead a cause of action for conversion.

 

Negligence

The Court also sustained the plaintiff’s negligence claim against the motion to dismiss.  In Illinois, a negligence action arising from a bailment requires allegations of (1) an express or implied agreement to create a bailment, (2) delivery of property to the bailee in good condition, (3) bailee’s acceptance of the property, and (4) bailee’s failure to return the property or its returning the property in damaged condition.

The plaintiff sufficiently alleged an implied bailment – that defendant accepted the pallets and failed to return some of the pallets while returning others in a compromised state.  These allegations were enough for the negligence count to survive.

Promissory Estoppel

The Court found that the defendant sufficiently pled an alternative promissory estoppel counterclaim.  Promissory estoppel applies where defendant makes a promise that the plaintiff relies on to its detriment.  The pleading elements of promissory estoppel are (1) an unambiguous promise, (2) plaintiff’s reliance on the promise, (3) plaintiff’s reliance was expected and foreseeable by defendant, (4) plaintiff relied on the promise to its detriment.

A promissory estoppel claim can’t co-exist with a breach of express contract claim: it only applies where there is no contractual consideration.  Here, the defendant/counter-plaintiff alleged there was no express contract.  Instead, it claimed that plaintiff’s promise to pay anyone who returned the pallets motivated defendant to return thousands of them.  The court viewed these allegations as factual enough for a colorable promissory estoppel claim.

Tortious Interference with Contract and Business Expectancy

The court dismissed the defendant’s tortious interference counterclaims.  Each tort requires a plaintiff to point to defendant’s conduct directed at a third party that results in a breach of a contract.  Here, the defendant’s counterclaim focused on plaintiff’s own actions in unilaterally raising prices and altering terms of its earlier pallet return program.  Since defendant didn’t allege any conduct by the plaintiff aimed at a third party (someone other than counter-claimant, e.g.), the tortious interference claims failed.

Take-aways:

1/ Conversion action can be based on defendant’s possession that was initially lawful but that later becomes wrongful;

2/ A Promissory estoppel claim can provide a viable fall-back remedy when there is no express contract;

3/ Tortious interference claim must allege defendant’s conduct directed toward a third party (someone other than plaintiff);

4/Where personal property is wrongfully detained and ultimately returned, the property owner can still have valid detinue claim for damages.

Fire Alarm Contract Doesn’t Create Implied Warranty Claim – IL ND

Two titans of their respective industries went head-to-head in Allstate Indemnity Company v. ADT, LLC, 2015 WL 3798715 (N.D.Ill. 2015), a dispute over an alarm company’s responsibility for fire damage to its homeowner customer.

After a 2013 house fire decimated its insured’s home to the tune of about $1.4M in damages, the plaintiff home insurer (Allstate) sued ADT, the home smoke and fire alarm installer, for negligence, breach of contract and consumer fraud for failing to complete smoke detector repairs it was hired to complete about 7 months before the fire.

The Northern District, in Allstate Indemnity Company v. ADT LLC, 2015 WL 3798715, *2 (N.D.Ill. June 17, 2015), granted ADT’s motion to dismiss the complaint with prejudice and in doing so, addressed some important issues involving contract interpretation, exculpatory provisions and damage limitations in home security contracts.

The 2007 alarm contract (the “Alarm Contract”) was for an initial three-year term and was automatically renewed for 30-day increments unless terminated in writing. The Alarm Contract contained a limited warranty and a waiver clause that provided that the alarm company was not an insurer against damage to the insured home.

Other than some basic warranties, ADT’s contract disclaimed consequential or incidental damages.

The court rejected the insurer’s argument that the contract’s damage waiver was unenforceable. In Illinois, an exculpatory clause or damage waiver is enforceable unless it is unconscionable or violates public policy. Since there were no public policy concerns implicated, the alarm contract damage waiver was upheld and defeated Allstate’s claims.

Allstate also lost its breach of implied warranty claim.  Illinois doesn’t recognize an implied warranty in service contracts. The only settings where a court recognizes an implied warranty is in (1) contracts involving the sale of goods, (2) contracts involving residential property construction (where the implied warranty of habitability attaches) and (3) construction contracts – where Illinois recognizes an implied warranty of performance in a good, workmanlike manner.

Since the Alarm Contract didn’t involve the sale of goods and wasn’t a construction contract, Allstate’s implied warranty claim failed.

Lastly, the court discarded Allstate’s consumer fraud claim.  The Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA), 815 ILCS 505/2 broadly prohibits unfair methods of competition and unfair or deceptive acts.  But where a consumer fraud claim simply duplicates a breach of contract claim, the consumer fraud count is redundant and should be stricken.

A plaintiff can’t “dress up” a garden-variety contract claim as one sounding in fraud.  Here, since Allstate repackaged its breach of contract suit and labeled it as a consumer fraud claim, the court dismissed Allstate’s ICFA claim.

Key take-aways:

1/ A clear waiver provision in a service contract will be enforced as written; even if it puts some financially harsh consequences on the plaintiff;

2/ Service contracts won’t give rise to an implied warranty claim in Illinois;

3/ A breach of contract does not equate to consumer fraud.  A repackaged breach of contract claim that is appended with a consumer fraud label will be dismissed as redundant (to the parallel breach of contract claim).

Reference: http://law.justia.com/cases/federal/district-courts/illinois/ilndce/1:2014cv09494/303656/21/

‘It Seemed Like a Good Idea At The Time’: Revenge Porn In Illinois – A Crime With Myriad Civil Components

Camera

Nation-wide vilification of revenge porn (“RP”) – the unconsented on-line dissemination of sexual photos or images of others (almost always females) – reached an ironic crescendo on Good Friday of 2015 when a California judge  sentenced Kevin Bollaert, 28, proprietor of the UGotPosted.com and ChangeMyReputation.com Websites, to an 18-year prison term after a jury convicted him of identity theft and extortion.1

Mr. Bollaert’s sites allowed users (usually jilted paramours) to post intimate photos of third parties without their permission.  When the terrified photographed party would contact the site to take the images down, Mr. Bollaert would then extract (extort?) a “settlement” payment from the party.

The near two-decades long jail sentence can be viewed as a culmination of cultural outrage at RP as evidenced by a flurry of civil verdicts across the country and (at current writing) 16 state legislatures criminalizing the practice.  Mr. Bollaert’s lengthy punishment, aside from giving him some time to consider “was it worth it?”, may also prove a symbolic harbinger of what’s to come for future RP peddlers.

Hostility toward RP has bled into varied sectors of society.  In the international realm, Great Britain recently (April 2015) criminalized the practice by enacting a law that provides for tough penalties against RP defendants and other nations across the globe are likely to follow suit.2

RP has infiltrated the sports arena, too.  In December of last year, New York Jets linebacker Jermaine Cunningham was arrested and charged after he posted naked photos of his ex-girlfriend on-line and sent them to her family members (ouch!).   Mr.vCunningham pled not guilty in May 2015 to various criminal invasion of privacy charges.3

Most recently, RP hit the news on an astronomical scale as Google, the Web search behemoth, announced it would allow anyone to delete images posted without their permission.4  Social media titans Twitter, Facebook and Reddit followed in Google’s wake and announced similar policies that police the posting of sexually explicit media.5

But while RP’s criminalization garners the most media attention – Illinois’ own statute, which took effect in June 2015, is praised by privacy advocates as particularly robust 6 – RP also gives rise to a plethora of civil causes of action and provides fertile ground for creative lawyering.

This article briefly discusses the various civil claims under Illinois law that are implicated in a case where a defendant – be it an individual or Website owner – posts sexual photos without someone’s consent.

Wikipedia describes RP as “sexually explicit media that is publicly shared online without the consent of the pictured individual.”7  Typically, RP is uploaded by a victim’s ex-partner whose goal is to shame the imaged victim and who sometimes includes the victim’s name, social media links and other identifying information.

Many times, the salacious images are “selfies”, pictures taken by the RP victim.  The harmful impact of RP is (or should be) self-evident: sociologists and psychologists have studied RP recipients and heavily documented the toxic psychological, social and  financial ramifications they suffer.8 

The legal community has also taken notice of RP’s proliferation in this digitally-drenched culture.  Witness international mega-firm K&L Gates’ recent launch of a legal clinic dedicated to helping RP plaintiff’s get legal redress

Civil verdicts

Civil suits against RP defendants appear to be gaining traction.  For just in the past year or so, juries and judges in several states have hit both individual and corporate RP defendants with substantial money judgments.  A California and Ohio court recently socked RP defendants with $450,000 default judgments and civil juries in Florida and  Texas awarded RP plaintiffs $600,000 and $500,000, respectively. 10, 11. 

My research has revealed only a single revenge porn case pending in Illinois, but no published decisions yet. 12

“So What’s A Gal (Almost Always)/Guy To Do?” – Common Law and Statutory Civil Claims

Aside from lodging a criminal complaint, an RP plaintiff has an array of common law and statutory remedies at her disposal.  A brief summary of the salient causes of action under Illinois law that attach to a revenge porn follows.

(1) Invasion of Privacy – Public Disclosure of Private Facts

Illinois recognizes four common-law invasion of privacy torts, those being (1) an unreasonable intrusion upon the seclusion of another; (2) an appropriation of another’s name or likeness; (3) a public disclosure of private facts; and (4) publicity that reasonably places another in a false light before the public. 13

To state a common law claim for invasion of privacy through public disclosure of private facts, a plaintiff must prove: “(1) publicity was given to the disclosure of private facts; (2) the facts were private, and not public, facts; and (3) the matter made public was such as to be highly offensive to a reasonable person.” 14

Generally, to satisfy the publicity element of the tort, a plaintiff must show that the information was disclosed to the public at large; however, the publicity requirement may be satisfied where a disclosure is made to a small number of people who have a “special relationship” with the plaintiff. 15  An invasion of a plaintiff’s right to privacy is important if it exposes private facts to a public whose knowledge of those facts would be embarrassing to the plaintiff.

This might equate to the “general public” if the person is a public figure, or a particular public such as fellow employees, club members, church members, family, or neighbors, if the person isn’t a public figure. 16

Invasion of privacy damages include actual, nominal, and punitive ones. 17

An intrusion on seclusion invasion of privacy plaintiff must show: (1) an unauthorized intrusion or prying into a plaintiff’s seclusion; (2) the intrusion is highly offensive or objectionable to a reasonable person; (3) the matters upon which the intrusion occurred were private; and (4) the intrusion caused anguish and suffering. 17-a

RP Application:  Posting a sexual image on the Internet would qualify as “publicity” and “private” matters under any reasonable interpretation.  And nonconsensual posting would signal highly offensive content to a reasonable person.  The plaintiff’s biggest hurdle would be quantifying his damages in view of the paucity of published RP cases.  But judging from the above default and jury awards, damages ranging from $450,000-$600,000 don’t seem to shock the court’s conscience.  In addition, an intrusion on seclusion claim could fail if the RP case involved a selfie – since that would seem to defeat the “private” and “seclusion” elements of the tort.

(2) Illinois Right of Publicity Act (the “IRPA”)

In 1999, IRPA replaced the common law misappropriation of one’s likeness – the second (2) above branch of the four common-law invasion of privacy torts outlined above.  Illinois recognizes an individual’s right to “control and to choose whether and how to use an individual’s identity for commercial purposes.” 18  The right of publicity derives from the right to privacy  and is “designed to protect a person from having his name or image used for commercial purposes without (her) consent.” 19

“Commercial purpose” under the IRPA means the public use or holding out of an individual’s identity (i) on or in connection with the offering for sale or sale of a product, merchandise, goods, or services; (ii) for purposes of advertising or promoting products, merchandise, goods, or services; or (iii) for the purpose of fundraising. 20 “Identity” means “any attribute” of a plaintiff including a photograph or image of the person. 21

Plaintiff must prove revenue that a defendant generated through the use of Plaintiff’s image.  Failing that, plaintiff can recover statutory damages of  $1,000. 22.  An IRPA plaintiff can also recover punitive damages and attorneys’ fees. 23.

RP Application: RP fits snugly within IRPA’s coverage.  It specifically applies to photographs or images.  If the RP defendant was making money off the unconsented Web postings, and IRPA claim could prove both a viable and valuable claim that would allow the plaintiff to recover statutory damages and attorneys’ fees.

(3), (4) Intentional and Negligent Infliction of Emotional Distress

“To prove a cause of action f0r intentional infliction of emotional distress, the plaintiff must establish three elements: (1) extreme and outrageous conduct; (2) intent or knowledge by the actor that there is at least a high probability that his or her conduct would inflict severe emotional distress and reckless disregard of that probability; and (3) severe emotional distress.” 24

A negligent infliction of emotional distress plaintiff must plead and prove the basic elements of a negligence claim: a duty owed by the defendant to the plaintiff, a breach of that duty, and an injury proximately caused by that breach. 25  A bystander negligent infliction plaintiff must prove a physical injury or illness resulting from the conduct. 26  

Since literally millions consume social media on a daily basis (27), perhaps it’s not a stretch to see a bystander make out a negligent infliction claim based on RP aimed at a bystander’s close relative for example.

RP Application  Under prevailing social mores, posting sexually explicit media    designed to shame someone or to extract money from them would likely meet the objectively extreme and outrageous test.  The intent or reckless disregard element would likely be imputed to a defendant by virtue of him publicizing the offending material.  The unanswered questions would be damages.  Putting it rhetorically, how would you (judge or jury) compensate the RP where there is no precise numerical formula?

(5) Copyright Infringement

Copyright infringement as applied to the RP setting represents a creative – and some way the best – way to attack RP.  28  The Federal copyright scheme particularly fits a RP situation involving “selfies” – which, by some accounts, make up nearly 80% of RP claims. 29

Copyright law gives an owner the exclusive rights – among others – to duplicate and exhibit a work.  Copyright protection exists for any work fixed in a tangible medium and includes photographs and videos. 30  The copyright infringement plaintiff must establish (1) she owns the copyright in the work; and (2) the defendant copied the work without the plaintiff’s authorization.18  Inputting a copyrighted work onto a computer qualifies as “making a copy” under the Copyright Act. 31

The catch here is that formally registering the work is a precondition to filing suit for infringement. 32

Being able to sue a defendant for copyright infringement is obviously an important right since that is copyright law’s “teeth”: a winning copyright plaintiff can recover statutory damages, actual damages plus attorneys’ fees. 33

But it begs the question – is it realistic that an RP plaintiff is going to draw more attention to a salacious photo by registering it with a Federal government agency?  Not likely.  Nevertheless, a copyright claim could lie for RP conduct involving a plaintiff’s selfies if she registered them with the US Copyright office.

What about the CDA (Communications Decency Act)?

Another important consideration in the RP calculus involves Section 230 of the Communications Decency Act (“CDA”) – a statute on which much electronic “ink” has spilled and that is beyond the scope of this article.  34  Basically, as I understand it, the CDA immunizes Web service providers (Comcast, AOL, etc.) from a third-party’s publication of offensive content but not Web content providers.  35  So the CDA inquiry distills to whether a Website defendant is a service provider (in which there would be immunity) or content provider (in which case there wouldn’t be).36.

(6) Negligence

A common law negligence action against an RP spreader constitutes another creative adaptation of a tried-and-true cause of action to a decidedly post-modern tort (and crime).  An Illinois, a negligence plaintiff must plead and prove (1) the defendant[s] owed a duty of care; (2) the defendant[s] breached that duty; and (3) the plaintiff’s resulting injury was proximately caused by the breach. 37

The plaintiff would have to prove that the RP defendant owed a duty of care not to post and distribute intimate images of the plaintiff, that the defendant breached the duty by indiscriminately posting the image, and that plaintiff suffered injury as a proximate cause.

Like the privacy torts encapsulated above, the key questions seem to be causation and damages.  That is – what numerical damages can the RP plaintiff establish that are traceable to the illicit (electronic) is is  publication?  Conceivably, she could request lost wages, medical and psychological treatment costs, pain and suffering, loss of a normal life, etc. – the entire gamut of damages a personal injury plaintiff can seek.

Afterwords:

RP is a subject whose contours seem to be in perpetual flux as the law is fluid and still developing.  In fact, by the time this article is published, it’s possible that there will be a flurry of legislative, political and even case law developments that make some of the contents dated.

That said, as on-line privacy issues and social media use continue to pervade our culture and expand on a global level, and as publishers of private, salacious photographs aren’t learning their collective lesson, RP will likely secure its foothold in cyberlaw’s criminal and civil landscapes.

The above is not an exclusive list of potential revenge porn causes of action.  As states (and countries) continue to enact laws punishing RP, it’s likely that civil damage claims attacking the practice will mushroom in lockstep with RP’s rampant criminalization.

References:

1. http://www.nbcsandiego.com/news/local/Kevin-Bollaert-Revenge-Porn-Sentencing-San-Diego-298603981.html

2. http://www.independent.co.uk/news/uk/home-news/revenge-porn-illegal-in-england-and-wales-under-new-law-bringing-in-twoyear-prison-terms-10173524.html

3. http://www.msn.com/en-us/sports/nfl/nfl-linebackers-case-highlights-rise-of-revenge-porn-laws/ar-BBj8sP9

4.  http://bigstory.ap.org/article/ff3b7f7b697b4af295935ed6a482ca1e/google-cracks-down-revenge-porn-under-new-nudity-policy

5. http://www.huffingtonpost.com/mary-anne-franks/how-to-defeat-revenge-porn_b_7624900.html

6. http://www.ilga.gov/legislation/publicacts/fulltext.asp?Name=098-1138 (text of Illinois’ revenge porn law, eff. 6.1.15)

7. https://en.wikipedia.org/wiki/Revenge_porn

8.  http://www.huffingtonpost.com/mary-anne-franks/how-to-defeat-revenge-porn_b_7624900.html

9.  http://dealbook.nytimes.com/2015/01/29/law-firm-founds-project-to-fight-revenge-porn/?_r=0

10. http://arstechnica.com/tech-policy/2015/03/revenge-porn-creepsters-ordered-to-pay-900000-in-default-judgment

11. http://www.brownanddoherty.com/florida-jury-delivers-record-setting-600000-00-verdict-in-revenge-porn-case.php; http://www.houstonchronicle.com/news/houston-texas/houston/article/Jury-awards-500-000-in-revenge-porn-lawsuit-5257436.php6.

12. http://articles.redeyechicago.com/2014-03-11/news/48127548_1_hunter-moore-mary-anne-franks-legislators

13.  Ainsworth v. Century Supply Co., 295 Ill.App.3d 644, 648, 230 Ill.Dec. 381, 693 N.E.2d 510 (1998).

14-16.  Miller v. Motorola Inc., 202 Ill.App.3d 976, 978, 148 Ill.Dec. 303, 560 N.E.2d 900, 902 (1990), citing W. Keeton, Prosser & Keeton on Torts § 117, at 856–57 (5th ed.1984)

17.  Lawlor v. North American Corporation, 2012 IL 112 530, ¶¶ 58-65

17-a.  Huon v. Breaking Media, LLC, 2014 WL 6845866 (N.D.Ill. 2014) 

18-19. Trannel v. Prairie Ridge Media, Inc., 2013 IL App (2d) 120725, ¶¶ 15-16

20. 765 ILCS 1075/1.

21. 765 ILCS 1075/5

22. 765 ILCS 1075/40(a)(2)

23. 765 ILCS 1075/40(b)

24. Doe v. Calumet City, 161 Ill.2d 374 (1994)

25-26.  Rickey v. CTA, 98 Ill.2d 546 (1983)

27.  http://www.statista.com/statistics/264810/number-of-monthly-active-facebook-users-worldwide/ (Facebook has 1.44B users; Twitter has 236M; Instagram – 300M)

28-29. http://www.washingtonpost.com/news/the-intersect/wp/2014/09/08/how-copyright-became-the-best-defense-against-revenge-porn/

30-31: In re Aimster Copyright Litigation, 343 F.3d 643 (7th Cir. 2003)

32.  17 U.S.C. § 1104

33.  http://copyright.gov/circs/circ01.pdf

34.  https://www.law.cornell.edu/uscode/text/47/230

35.  http://www.defamationremovallaw.com/what-is-section-230-of-the-communication-decency-act-cda/

36.  Zak Franklin, Justice for Revenge Porn Victims: Legal Theories to Overcome Claims of Civil Immunity by Operators of Revenge Porn Websites, 102 Cal. L. Rev. 1303 (Oct. 2014).                               

37. Corgan v. Muehling, 143 Ill.2d 296, 306 (1991)