July 16, 2019

Archives for February 19, 2016

Keri Yoder Appointed as District Court Judge in 7th Judicial District

On Friday, February 19, 2016, the governor’s office announced Governor Hickenlooper’s appointment of Keri Yoder to the Seventh Judicial District Court bench. She will fill a vacancy created by the resignation of Hon. Jeff B. Herron, effective March 1, 2016.

Currently, Yoder is an Assistant District Attorney in the Seventh Judicial District Attorney’s Office, where she has been since 2002. Prior to her work at the DA’s Office, Yoder was in private practice, where she practiced civil and employment law. She received her undergraduate degree from the University of Michigan and her law degree from the University of Colorado School of Law.

For more information about the appointment, click here.

HB 16-1049: Amending Crowdfunding Act to Describe Entity Holding Escrow Account

On January 13, 2016, Rep. Pete Lee and Sens. Mark Scheffel and Owen Hill introduced HB 16-1049Concerning an Escrow Account Held by a Depository Institution on Behalf of an Issuer of an Intrastate Offering of Securities. The bill was assigned to the House Finance Committee.

This bill amends the “Colorado Crowdfunding Act,” enacted in 2015, by using the term “depository institution” to describe the entity that an issuer must use to set up an escrow account to hold proceeds from the intrastate sale of securities. Additionally, if enacted, the proposed bill would allow the issuer to terminate the escrow account once the minimum amount of proceeds from a sale of securities is deposited into the account.

The bill proposes to amend three sections of C.R.S. § 11-51-308.5: Section (3)(a)(IV)(D), Section (3)(a)(IV)(F), and Section (3)(a)(IX). First, under Section (3)(a)(IV)(D), it is proposed that the term “Depository Institution” be inserted in place of “bank, regulated trust company or corporate fiduciary, savings bank, savings and loan association, or credit union.”

Second, under subsection (F), it has been proposed that an exception be added, providing that “once the minimum offering amount has been raised and deposited in the escrow account, the issuer may terminate the escrow arrangement.”

Lastly, under subsection (IV), the term “depository institution” has been proposed to be inserted in place of the term “financial institution.”

Since its introduction, the bill passed out of the Finance Committee unamended and was referred to the House Committee of the Whole for Second Reading. It passed Second and Third Reading in the House, unamended, and was introduced in the Senate on February 1. On February 18, it passed out of the Senate Finance Committee, unamended, and was scheduled on the consent calendar of the Senate Committee of the Whole.

Mark Proust is a 2016 J.D. candidate at the University of Denver Sturm College of Law.

HB 16-1035: Limiting Public Utility Securities to Electricity or Gas Services

On January 13, 2016, Rep. Jon Keyser introduced HB 16-1035Concerning the Scope of Statutes Making the Issuance of Securities by a Public Utility Conditional on Approval by the Colorado Public Utilities Commission, and, In Connection Therewith, Clarifying That the Approval Requirement Applies Only to Electric and Gas Utilities. The bill was assigned to the House State, Veterans, and Military Affairs Committee.

This bill introduces an amendment to an already existing bill and aims to narrow the statue, requiring advance approval by the public utilities commission for the issuance of securities to fund property acquisitions, facilities, repairs, and other expenditures, to apply only to electric and gas utilities.

The only amendment to C.R.S. § 40-1-104 is the addition of subsection (b) under the rule. Subsection (b) is proposed to read as follows: “The requirements of this section apply only to public utilities providing electricity or gas service.”

Mark Proust is a 2016 J.D. candidate at the University of Denver Sturm College of Law.

Colorado Court of Appeals: Employer May Terminate Employee for Conduct Reasonably Related to Job Activities

The Colorado Court of Appeals issued its opinion in Williams v. Rock-Tenn Services, Inc. on Thursday, February 11, 2016.

Douglas Williams had been employed by Rock-Tenn Services for 36 years, and in the last four years of his employment, Williams was the Denver plant manager. In 2012, the Denver plant underwent a scheduled audit. Williams rescheduled his previously approved vacation in order to attend the post-audit meeting on June 27, 2012, but due to a scheduling conflict with upper-level management, the meeting was rescheduled for July 3, 2012, during Williams’ previously scheduled vacation. Williams’ supervisor, Vas, approved the vacation and absence from the meeting, but Vas’ supervisor, Morris, became upset that Williams was not at the meeting and ordered his termination. When Williams returned from vacation, he was terminated.

Williams sued Rock-Tenn under Colorado’s Lawful Off-Duties Activities Statute (LODAS), arguing that his approved vacation and absence from the meeting was a lawful activity for which he could not be terminated. Rock-Tenn filed a motion to dismiss for failure to state a claim, which the district court granted, holding that Williams’ conduct plainly fell within one of the LODAS exceptions because the termination was reasonably and rationally related to Williams’ duty to attend the post-audit meeting. Williams appealed, holding the dismissal was in error because his approved vacation was a personal, private activity protected by LODAS. He also suggested the dismissal was improper because it was based on an affirmative defense.

The court of appeals analyzed Williams’ factual allegations and found that they plainly showed the vacation and missing the meeting were inextricably linked. Williams was unavailable in person or by phone during his vacation, and the court agreed with the district court’s determination that Williams alleged Rock-Tenn improperly terminated him for missing the meeting while he was on a pre-approved vacation. Although the court found that Williams was correct that generally a party need not address an affirmative defense in its complaint, in these circumstances Williams was on notice of the availability of the affirmative defense because his complaint alleged impropriety under the same subsection of LODAS from which the affirmative defense arises. The court therefore found no error in the district court’s dismissal. Similarly, the court of appeals agreed with the district court that Williams’ complaint failed to state a claim from which relief could be granted due to the presence of the affirmative defense. Addressing Rock-Tenn’s request for attorney fees, the court of appeals declined to award attorney fees, noting that Rock-Tenn stated no legal basis for the fee award.

The court of appeals affirmed the district court.

Colorado Court of Appeals: Foreseeability of Arson Fire During Burglary Relevant to Determination of Damages

The Colorado Court of Appeals issued its opinion in Core-Mark Midcontinent Inc. v. Sonitrol Corp. on Thursday, February 11, 2016.

Core-Mark distributed merchandise to convenience stores, and it hired Sonitrol to install and monitor a security system for its warehouse. In 2002, burglars broke into Core-Mark’s warehouse and looted it for several hours, eventually setting a fire that destroyed the building and its contents. Core-Mark sued Sonitrol, asserting tort and breach of contract claims. The district court dismissed the tort claims and granted summary judgment to Sonitrol on the breach of contract claims based on a limitation of liability. Core-Mark appealed, and the court of appeals affirmed the dismissal of the tort claims but reversed summary judgment on the breach of contract claims.

On remand, a jury found that Sonitrol had breached its contract, and awarded $7,348,732 to Core-Mark and $10,965,777 to its insurers. Sonitrol appealed, and the court of appeals in Sonitrol II affirmed the award as to Sonitrol’s liability but reversed the damages award. The Sonitrol II division held that the district court erred in excluding testimony from Sonitrol’s experts on the foreseeability of the extent of Core-Mark’s losses. The division remanded for a new trial on damages, and the jury in that trial awarded $2,750,000 to Core-Mark.

Core-Mark appealed, arguing (1) the district court erred in allowing Sonitrol to present evidence that the arson was not foreseeable, (2) the district court erred in refusing Core-Mark’s tendered jury instruction on the phrase “natural and probable consequence” as used in the damages instruction, and (3) the district court abused its discretion in excluding evidence of how Sonitrol breached its contract.

Addressing the first claim, the court of appeals found that the district court did not err in allowing Sonitrol to present evidence about the foreseeability of arson. The district court specifically allowed testimony on the rarity of arson in burglary cases, the excessive amount of flammable materials in Core-Mark’s warehouse, and the inadequacy of Core-Mark’s sprinkler system. Core-Mark argued that the testimony exceeded the scope of remand, because the Sonitrol II division had made a statement that it assumed the fire was foreseeable. The district court rejected Core-Mark’s argument that the statement was the law of the case, noting it was not necessary to the holding. The court of appeals affirmed, finding that arson was not a type of damages but rather a cause of damages, and the foreseeability of the loss from the fire was relevant to the general magnitude of damages.

Turning to Core-Mark’s contention regarding the jury instruction, the court of appeals found no error in the district court’s rejection of Core-Mark’s proposed instruction. Core-Mark did not contend that the foreseeability instruction incorrectly stated the law, but rather that it should have been allowed to further define a term in the instruction. The court of appeals found that Core-Mark was incorrect that “probable” does not mean “likely” in the context of the jury instructions, and found no error in the district court’s rejection of Core-Mark’s tendered instruction.

Finally, Core-Mark argued the district court abused its discretion by not allowing evidence of the nature of Sonitrol’s breach of contract as set forth in the first trial. The court of appeals analyzed the proffered evidence and found it was not relevant to the determination of damages. The district court read a statement to the jury about the events leading to the fire, but excluded evidence of the specifics of Sonitrol’s conduct or alarm system. The court of appeals found no abuse of discretion.

The court of appeals affirmed the district court.

Tenth Circuit: Unpublished Opinions, 2/18/2016

On Thursday, February 18, 2016, the Tenth Circuit Court of Appeals issued no published opinion and two unpublished opinions.

United States v. Jaquez

Green v. United States

Case summaries are not provided for unpublished opinions. However, published opinions are summarized and provided by Legal Connection.