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RDM's Knowledge Blog Posts by The RDM Team

Dr. Maya Angelou and Dr. Yusef Salaam, heroes of Black history and present. In the background is a photo of the March on Washington for civil rights in 1963.

February will always be that sacred time of year when we reflect on and celebrate Black History. Thanks to the contributions and sacrifices of those that came before me, I got to enjoy a childhood that was, for the most part, insulated (no pun intended) from the ghosts of this country’s racist past. I was born in the 90s—over 30 years after Dr. Martin Luther King, Jr.’s iconic March on Washington. I grew up in a military family, no less, so there was no shortage of diversity in the communities we lived in. I certainly wasn’t oblivious to the Civil Rights Movement—and my parents made darn sure I knew about it—but to say that I’d lived it, or even witnessed it with my own eyes, simply wouldn’t be true. Looking back on it, though, I realize that my childhood was a living testament to the dream Dr. King spoke of on the steps of the Lincoln Memorial all those years ago. It’s not something I take for granted, but as I grew into adolescence and adulthood, I had to come to terms with the inevitable conclusion that there is still much to do.

It’s the collective experience and sacrifices of those great individuals that came before us, including Dr. King, Thurgood Marshall, Harriet Tubman, Malcolm X, Rosa Parks, Muhammad Ali, and so many others, that help us make sense of the world we live in today. We all are immeasurably blessed that their legacies are something we have the chance to reflect on with the benefit of hindsight. Even in today’s climate of social unrest, there is much we can learn from the way these Black heroes lived their lives that will enrich and empower us, as we carry on through our own.

I know I am far from the only person who has struggled with frustrations when they see the systems in this country were set up in a way that benefits some to the detriment of others. And I don’t mean “see” like you read it in a book or online. I mean taking a drive down Troost Avenue in Kansas City, Missouri, in 2023 and seeing, with your own eyes, the ever-present effects of redlining practices that took place decades ago. I mean learning about (and visiting) Tulsa, Oklahoma. I know that I (and many others) have spent nights agonizing over America’s insatiable appetite for unrestrained cruelty, particularly where Black lives and blue lives are concerned. The likes of Keenan Anderson, George Floyd, Breonna Taylor, Tamir Rice, Philando Castile, Stephon Clark, Alton Sterling, Eric Garner, Trayvon Martin, and many others each serve as painful reminders that as far as we’ve come, there is still some way to go.

For many, accepting this reality means you’ve inevitably dealt with those same feelings of frustration, and at its worst, resentment. But what do you do with those negative emotions? I encourage anyone that has felt (or is feeling) this way to take this month to reflect on the lessons we can learn in Black history. To put this in perspective, I will share a discussion I was lucky to have with Dr. Yusef Salaam—one of the “Exonerated (Central Park) Five” during a visit he took to KU in February 2020, during my last year of law school. There, I asked him how on Earth he emerged on the other side of a wrongful conviction, losing years of his life in prison, and being vilified in a page one newspaper article by (at the time) the sitting President of the United States—who to this day has never issued any kind of apology. How did he suffer through all of that without being vengeful towards the inequitable systems in this county that allowed that to happen? His response to me was a quote he learned from Dr. Maya Angelou:

“You should be angry. You must not be bitter. Bitterness is like a cancer. It eats upon the host. It doesn’t do anything to the object of its displeasure. So use that anger. You write it. You paint it. You dance it. You march it. You vote for it. You do everything about it. You talk it. Never stop talking it.” 

And that’s exactly what Dr. Salaam did. He read, and he wrote, and he never stopped talking about it.  That is how he overcame his struggle and went on to inspire a generation—myself included. And therein lies the beauty of Black history. Behind every great man or woman in history was someone that inspired them to act in kind. In this sense, Black history is not something distant or perpetually suspended within the ambit of the Civil Rights Movement. It’s always being made. From Dr. Angelou to Dr. Salaam, and from Dr. Salaam to myself—it’s Black people inspiring those that follow after that constitutes Black history. It’s something that should always be celebrated, shared, and in times of strife, should be looked to for wisdom and clarity. I thank Dr. Angelou because her words gave grace and clarity to frustrations I’d carried in my heart for years. I also thank Dr. Salaam for being the vessel through which her words could flow in ways that not only inspired and changed the course of his life but also touched on mine.

I am certain there is something for all of us to learn this month that will revitalize our collective spirit and inspire us as we carry on through this year. We only have so much time on this earth, and the clock is ticking inexorably toward our journey’s end. To that end, I would encourage anyone to be proactive and seek out ways we can learn from and emulate our predecessors. It is incumbent on all of us to ensure that their legacy lives on. Whether that be reading about these Black revolutionaries online, conversing with a colleague, or simply watching a Netflix documentary—what can you learn from those that came before, and how can you ensure those lessons are passed on to those that follow after? 

This article was originally published in the February 2023 issue of DRI’s The Voice. Dillon is a member of DRI’s Diversity and Inclusion Committee.

The Federal Trade Commission Building in Washington DC. The FTC has proposed a new rule barring many non-compete agreements.

The current landscape regarding the enforcement of non-compete agreements is about to get flipped on its head in the United States. Following President Biden’s July 2021 executive order encouraging the Federal Trade Commission to employ its statutory rulemaking authority “to curtail the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit worker mobility,” on January 5, 2023, the FTC—in a profound exercise of its regulatory power—issued a notice of proposed rulemaking that would have a sweeping effect on the enforcement of non-compete agreements.

The Proposed Rule 

The new rule will not only bar employers from entering into non-compete agreements with their workers. It will additionally require employers to rescind pre-existing non-compete clauses no later than 180 days after the final rule is published. Additionally, employers will be required to provide notice to their employees that, as of the compliance date, any non-compete clauses are no longer in effect and may not be enforced against the worker.

To properly comply with the rule, an employer’s communication to its workers would need to be “individualized” and “on paper or in a digital format such as, for example, an email or text message.” Notice would need to be delivered within 45 days of rescinding the non-compete clause. The notice requirement would apply to current and former workers, to the extent that “the worker’s contact information [is] readily available.” The proposed rule includes a very limited exception which is applicable only to “a person who is selling a business entity or otherwise disposing of all of the person’s ownership interest in the business entity, or by a person who is selling all or substantially all of a business entity’s operating assets, when the person restricted by the non-compete clause is a substantial owner of, or substantial member or substantial partner in, the business entity at the time the person enters into the non-compete clause.” 

Preemptive Effect on States’ Non-Compete Laws

Until now, the enforceability of non-competition clauses was a matter of state law, and states’ positions regarding the proper scope of noncompetition restrictions have varied. If implemented, however, this new rule will supersede all state laws, regulations, orders, or interpretations to the extent that they are inconsistent with the FTC’s rule. It’s worth noting that only California, North Dakota, and Oklahoma outright ban the enforcement of non-compete agreements—so the FTC’s rule would effectively create a nationwide policy that goes further than state law in the remaining 47 states.

The tremendous significance of this new rule cannot be overlooked. Most U.S. companies will be forced to completely change how they operate in retaining talent and safeguarding company secrets. Thus, it should come as no surprise that the rule, if adopted in its current form, will face prompt legal challenges.

In publishing the Notice of Proposed Rulemaking—which is the first step in the FTC’s rulemaking process—FTC Commissioners voted 3-1, along partisan lines, with Commissioner Christine Wilson being the lone dissenter. In her dissenting statement, Commissioner Wilson notes that the proposed rule “…represents a radical departure from hundreds of years of legal precedent that employs a fact-specific inquiry into whether a non-compete clause is unreasonable in duration and scope, given the business justification for the restriction.” She further expects that the “…Commission’s competition rulemaking authority itself certainly will be challenged,” including under the “major questions doctrine” addressed in West Virginia v. EPA, as the “Commission lacks clear Congressional authorization to undertake this initiative.”

The public will have 60 days to submit comments on the proposed rule, which was based on a preliminary finding that non-compete clauses constitute an unfair method of competition and, therefore, a violation of Section 5 of the Federal Trade Commission Act. The FTC noted that it is specifically seeking comments on: 

  1. Whether franchisees should be covered by the rule; 
  2. Whether senior executives should be exempted from the rule or subject to a rebuttable presumption rather than a ban; and 
  3. Whether low- and high-wage workers should be treated differently under the rule.

The comment period closes after March 10, 2023. The rule would subsequently take effect 180 days after the final version is published, but its imposition could be delayed as it is almost certain to face a significant wave of litigation challenging the constitutionality of the rule.

Although the rulemaking process is still in the early stages, this is the strongest indication of legislative and executive intent to void existing non-compete agreements and ban the use of such agreements going forward. As the tides drastically change for American businesses, employers should be proactive before this comment period is over and speak to an attorney regarding how their policies on non-compete agreements will be affected going forward. RDM’s Employment and Labor Law Team is ready to help you understand your options and ensure compliance with potential new regulations. Contact RDM today.

The Missouri Capitol in Jefferson City. The state legislature passed statutes reforming punitive damage awards in 2020.

The Missouri legislature passed Mo. Rev. Stat. § 510.261 in 2020. The statute aimed to limit the frequency and sum of punitive awards. In advance of this aim, Mo. Rev. Stat. § 510.261.5 states that “[n]o initial pleading in a civil action shall contain a punitive damage award.” The section goes on to establish that the trial court must serve as a gatekeeper, granting plaintiffs leave of court to plead punitive damages only after a plaintiff shows “a reasonable basis for recovery of punitive damages” through “affidavits, exhibits, or discovery materials.”

The statute has now been in effect for a little over two years and has faced multiple challenges alleging the statute violates the Missouri State Constitution. Despite strong challenges from plaintiffs, the statute has been enforced in state courts throughout Missouri.

Defense counsel across the state have moved to strike punitive damage claims from initial pleadings filed after the statute’s activation date. Plaintiffs’ counsel have responded by asserting that the statute violates Article V of the Missouri Constitution, which states that “[t]he supreme court may establish rules relating to practice, procedure and pleading for all courts,” because the new statute conflicts with a procedural rule rightfully promulgated by the Missouri Supreme Court. This argument relies on the Missouri Court of Appeals ruling in State v. Emerson, which held that “if there is a conflict between [the Supreme] Court’s rules and a statute, the rule always prevails if it addresses practice, procedure or pleadings.” 573 S.W.3d 93, 102 (Mo. App. W.D. 2019). Plaintiffs have also claimed that the statute conflicts with the Missouri Rules of Civil Procedure and that the evidentiary standard and leave of court requirements violate the right to a jury trial found in Mo. Const. Art. 1 § 22(a).

Successes for Defendants…

Defendants have, to this point, been successful in enforcing the statute. At least three separate circuit courts have rejected plaintiffs’ arguments claiming the statute violates the Missouri Constitution and granted motions to strike punitive damage claims. There is not yet a written opinion explaining any court’s precise reasoning for upholding the statute, but defendants have advanced multiple persuasive arguments to rebut challenges.

First, defendants argue that the statute does not conflict with the Missouri Rules of Civil Procedure because the rules do not require punitive damages to be included in the initial pleading and the statute still allows punitive damages to be pleaded later. Defendants have also argued that the statute does not violate Mo. Const. Art. 5 because the statute only defines the right to punitive damages and therefore is substantive rather than procedural. Other defendants have argued that plaintiffs do not have a vested constitutional right in punitive damages, and the statute is merely procedural when guarding against claims that the statute interferes with Mo. Const. Art. 1 § 22(a)’s right to a jury.

…and Successes for Plaintiffs

While the statute continues to enjoy veiled but consistent enforcement in state court, plaintiffs have been successful in defeating defendants’ motions to strike in federal diversity actions. District Courts in both of Missouri’s federal districts have held that the statute is inapplicable in federal diversity cases because the Federal Rules of Civil Procedure “answer the same question.” See generally Davis v. ALS Express Trucking, Inc., 2022 U.S. Dist. LEXIS 140486. Plaintiffs’ counsel looking to avoid the new pleading requirements may start looking toward federal courts so long as parties are diverse. Plaintiffs have also been successful in limiting the statute’s application to only those cases filed after the statute’s trigger date of August 20, 2020. See generally Largent v. Pelikan, 628 S.W.3d 162 (Mo. App. E.D. 2021).

Looking Forward at Punitive Damages in Missouri

For the time being, it appears that Mo. Rev. Stat. 510.261.5 has survived initial constitutional tests. But plaintiffs’ counsel will certainly continue to bring forth challenges. The defense attorneys at Rasmussen Dickey Moore are prepared to employ all tools available to protect your business from punitive damages claims. Contact RDM today to discuss your case.

The Illinois State Capitol Building in Springfield, IL. Legislators recently approved a bill providing for prejudgment interest. Photo by Daniel X. O'Neil.

On May 28, 2021, Illinois Governor J.B. Pritzker signed into law Senate Bill 0072, which established the first pre-judgment interest regime in the state. The Amendment applies only to personal injury and wrongful death actions and imposes a 6% pre-judgment interest on future damage awards. The interest accrues from the date of filing. It does not apply to all such cases, though; the Amendment provides defendants the opportunity to set off the pre-judgment interest through speedy settlement negotiations.

The Carrot and The Stick

The setoff provision acts to encourage parties, particularly defendants, to engage in settlement negotiations within one year of filing. Under the Amendment, the interest does not apply to any amount totaling a defendant’s settlement offer which is 1) in writing, 2) made within 12 months of filing, and 3) either expressly rejected by the plaintiff or not accepted within 90 days. The Amendment acts as both the carrot and the stick, encouraging early settlement offers through interest relief while punishing a failure to offer a settlement with the potential for interest added on top of traditional damages and post-judgment interest.

Illinois Constitutional Issues

Immediately after the Amendment’s passing, defendants in Cook County, Illinois, filed a motion arguing that the Amendment violated the Illinois Constitution. On May 22nd, 2022, in Hyland v. Advocate Health and Hospital Corp. (No. 2017-L-3541), the Court rendered its judgment in favor of the defendants. Specifically, the Court held that the Statute violates the Illinois constitutional guarantee to a trial by jury and its prohibition of special legislation.

The Right to Trial by Jury

Article I, Section 13 of the Illinois Constitution of 1970 provides “the right of trial by jury as heretofore enjoyed shall remain inviolate.” Inherent in this provision, according to Illinois courts, is the right a jury’s determination of damages. Defendants argued that mandatory pre-judgment interest violates the right to a jury’s determination of damages, and the Circuit Court in Cook County agreed. Interestingly, the Court noted various jury studies which indicate that juries already include pre-judgment interest, at a rate above inflation, in their damage awards.

Special Legislation

Article IV Section 13 of the Illinois Constitution of 1970 prohibits special legislation, which acts “to prevent arbitrary legislative classifications that discriminate in favor of a select group without a sound, reasonable basis.” Best v. Taylor Machine Works, 179 Ill.2d 367 (1997). Defendants argued, and the Court again agreed, that a pre-judgment interest regime serves as special legislation and therefore violates the Illinois Constitution. The Court held that the Amendment unjustly discriminates in favor of personal injury and wrongful death plaintiffs and against plaintiffs in other tort suits, along with those defendants who were served over one year after the case was filed.

What’s next?

It is certain that we have not heard the last on the Amendment’s constitutionality. After the decision in Hyland, the Cook County Circuit Court issued a general order that anticipates a further ruling from the state’s higher courts. The status of the Amendment will likely remain in flux until the Illinois Supreme Court brings finality to the issue.

The Illinois First District Court of Appeals in Downtown Chicago. Photo by Vincent Desjardins.

The Appellate Court of Illinois, First Judicial District recently found that the COVID-19 pandemic was a factor that weighed against forum transfer in Bearden v. Conagra Foods, Inc. In this case, 45 plaintiffs brought a total of 39 product liability actions in the circuit court of Cook County against Conagra Foods, Inc., Conagra Brands, Inc., DS Containers, Inc., and Full-Fill Industries, LLC. Conagra Foods and the other defendants involved filed a combined motion to dismiss for forum non conveniens as to the out-of-state plaintiffs and a motion to transfer out of Cook County for the in-state plaintiffs. The circuit court issued a ruling without hearing argument dismissing the defendants’ motions and issued its findings.

Interestingly, in addition to weighing the standard private and public interest legal factors, the court also weighed another factor that has had both private and public implications for all of us over the past two and a half years: COVID-19.

While wrangling up all the necessary witnesses that could testify in a case involving numerous out-of-state plaintiffs and corporations with offices and employees across the country might be a factor against a forum in certain cases, here, the circuit court found that because of the COVID-19 pandemic, it was likely that most or all of the witnesses would testify by video and that remote depositions and testimony would likely be used. The court found that the arguments that court dockets would be backlogged and that jury trials might be postponed or delayed were not persuasive because COVID-19 had rendered that the case in every jurisdiction.

The circuit court did find, however, that jury visits to the sites weighed in favor of dismissal or transfer, not specifically because of COVID-19, but one could easily assume that if the court considered COVID-19 in other factors, perhaps having a jury travel to multiple states during a pandemic influenced its decision on that point as well.

COVID-19 as a Factor

On appeal, the defendants argued that the circuit court improperly found that COVID-19 weighed against dismissal or transfer. They argued that including COVID-19 as a factor was an abuse of the circuit court’s discretion. Upon review, the appellate court upheld the circuit court’s ruling in total, including its inclusion of COVID-19 in its list of factors.

The appellate court stated that “a circuit court’s decision is an abuse of discretion when it is arbitrary, fanciful, or unreasonable, or when no reasonable person would take the same view.” Bearden v. Conagra Foods, Inc., 2021 IL App (1st) 210234-U, ¶ 71 (quoting Palacios v. Mlot, 2013 IL App (1st) 121416, ¶ 18. The appellate court found that the circuit court’s consideration of such issues as testifying virtually or by video, packed dockets, and delayed jury trials, were not fanciful, arbitrary, or so unreasonable that no person would ever take the view of the circuit court. In affirming the circuit court’s decision, the appellate court has determined that COVID-19, and more specifically the impacts and related measures taken on and by the legal system can be a factor considered by Illinois circuit courts in deciding a forum non conveniens issue.

The New Normal During COVID-19

The factors considered by the circuit court in this case are familiar to anyone in the legal profession that has continued to work throughout the COVID-19 pandemic. Zoom and telephonic depositions have become the norm, trial dates have been pushed back multiple times, and pajama pants have become standard dress code while in webcam meetings (well, the court didn’t explicitly consider that last one, but we all know how important that’s become).

Concerns for Defendants

Forum non conveniens motions are a viable tool for defendants seeking to have cases dismissed, avail themselves of friendlier state or local laws, or a more favorable jury pool. Some of the standard factors weighing in favor of a transfer have been effectively negated by the measures taken by the legal profession to address the challenges of the COVID-19 pandemic. Now that courts and law firms have knowledge of these measures, they are not likely to go away anytime soon and could be damaging to a defendant’s motion for forum non conveniens efforts.

With many state legal systems continuing to utilize these COVID-19 measures and now precedent on the books in one of the busiest legal arenas in the country, it is possible that other courts and other states could follow the Illinois circuit court’s lead and explicitly consider COVID-19 in their analysis of forum non conveniens motions. For defendants, this could prove to be a bigger headache than trying to get that one co-counsel to mute their phone during your cross-examination. But hey, at least you don’t have to show the plaintiff how to work the Zoom camera.