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Archive for December, 2008

United States v. Creative Compounds, LLC., No. 07-3671

Creative Compounds imported 8,800 pounds of powdered egg whites from Peru.  Initially, Creative Compounds intended the powdered egg whites, a protein ingredient, to be for human consumption in nutritional products.  The price for powdered egg whites in the United States had risen, and Creative Compounds sought a cheaper version from Peru.

Egg product imports are regulated by two statutes.  The first, the Animal Health Protection Act (“AHPA”), regulates egg products intended for animal consumption.  The second, the Egg Products Inspect Act (“EPIA”) regulates egg products intended for human consumption.  The EPIA restricts importation of egg products for use as human food unless they were processed under “an approved continuous inspection system of the government of the foreign country of origin.”  21 U.S.C. 1046(a)(2).  Currently, only Canada and the Netherlands maintain a continuous inspection system equal to that of the United States.

Creative Compounds sought and received an import permit from the government to allow importation of the 8,800 pounds of powdered egg whites from Peru. However, the import permit noted that the product must be accompanied by an original certificate from the government of Peru stating that the product complied with AHPA regulations.  Creative Compounds did not obtain such a certificate.  The product was shipped from Peru to New York, then transported to Chicago, where it was mistakenly allowed through Customs, and then was moved to Creative Compounds’ warehouse in Missouri.

The government learned of that the powdered egg whites had been imported in violation of the EPIA and detained them until Creative Compounds could obtain the required certification from Peru.  When Creative Compounds could not obtain a certificate, the government filed a lawsuit to seize the product and destroy it.  The trial court granted the United States’ motion for summary judgment, noting that after the powdered egg whites cleared Customs and was transported to Missouri, they became a domestic article under the EPIA and, therefore, could not be transported to sold.

On appeal, Creative Compounds argued that it should be allowed to return the powdered egg whites to Peru.  The Eighth Circuit disagreed, following the trial court’s strict interpretation of the EPIA.

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The court held that HPI Products failed to comply with the Clean Water Act, Resource Conservation and Recovery Act, Emergency Planning and Community Right to Know Act, and Missouri environmental laws.  See the full story here.

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Couch v. Farmers Ins. Co., No. 08-389

A young lady was killed while a passenger in a one-vehicle accident.  Her family received $20,000 from the insurance carrier of the vehicle involved in the accident and $50,000 in underinsured motorist (“UIM”) benefits from Farmers.  Her family then sued Farmers for $150,000 in UIM benefits from three other Farmers policies.  Farmers moved for summary judgment, arguing that the policies contained clear and unambiguous anti-stacking clauses.  The trial court agreed and granted summary judgment.

On appeal, the family argued, among other things, that the anti-stacking provisions at issue were in derogation of Ark. Code Ann. 23-89-209.  This statute requires insurance carriers to offer UIM coverage, but allows an insured the option to reject such coverage.  The Arkansas Supreme Court disagreed with the family’s argument, noting that nothing in the anti-stacking provisions violated Ark. Code Ann. 23-89-209.  The court further stated that a policy exclusion such as an anti-stacking provision does not violate public policy because the insured can reject coverage.

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See the unfolding story here.

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Elbert v. True Value Co., No. 08-1222

In this retaliatory discharge claim, Elbert, in 2005, a truck driver for True Value, inspected the trailer he was supposed to operate and found that the brakes were not in good working order.  He informed True Value that the brakes were faulty and that he could not drive the trailer.  Two days later, True Value fired Elbert.

Based on the procedures in the Surface Transportation Assistance Act (“STAA”), Elbert filed a complaint with OSHA.  After an extensive hearing, the administrative law judge issued a recommended decision and order, but a final order was not filed within the 120-day time limit provided by STAA.

In 2007, Congress amended STAA to grant jurisdiction over claims under STAA to district courts regardless of whether a final order had been entered within the time allowed.  After this amendment, Elbert filed his retaliatory discharge claim in district court.  True Value moved to dismiss, arguing that the amendment should not be applied retroactively.  The trial court agreed and dismissed Elbert’s claim.

On appeal, the Eighth Circuit agreed that the amendment could not be applied retroactively.  The court noted that nothing in the amendment indicated that Congress intended the provision to apply retroactively.  Because of this absence, the court relied on the traditional presumption against retroactive legislation.  The court stated that elementary considerations of fairness dictate that individuals should have the opportunity to know the law and conform to it prior to any lawsuit against them.

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See an account of this interesting case here.

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Jones v. Currens, No. CA 08-136

In this motor vehicle accident case, the trial court allowed the investigating officer to testify regarding what one of the drivers had said to him after the accident.  There was conflicting trial testimony as to the driver’s mental state and when the statement occurred.  On appeal, the Arkansas Court of Appeals reversed and remanded the case back for a retrial because there was inadequate foundation for allowing the statement in as an excited utterance.

The court explained that additional evidence was required before the trial court could allow in the statement as an excited utterance:  (1) the timing of the statement to the accident, (2) the driver’s mental state, and (3) spontaneity of the statement.  Because the trial court allowed in the statement without clear evidence of these issues, the court held that the trial court had abused its discretion in failing to consider the proper factors or important information.

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