Wednesday, Feb. 20, 2019
State of Ohio v. Brad J. Dangler, Case no. 2017-1703
Sixth District Court of Appeals (Williams County)
State of Ohio v. Jeffrey Hitchcock, Case no. 2018-0012
Fifth District Court of Appeals (Fairfield County)
Edward F. Gembarski v. PartsSource Inc., Case no. 2018-0125
Eleventh District Court of Appeals (Portage County)
In re Application of Ohio Edison Co., Case no. 2018-0379
Public Utilities Commission of Ohio
Did Trial Court Properly Inform Defendant of Penalties that Would Result from Sex-Offender Classification?
State of Ohio v. Brad J. Dangler, Case no. 2017-1703
Sixth District Court of Appeals (Williams County)
ISSUE: During a plea hearing, does the failure of the sentencing court to inform a defendant of all the penalties associated with a sex-offender classification constitute a complete failure to comply with Crim.R. 11 and void the plea without the need to show prejudice resulted?
BACKGROUND:
As part of a plea bargain, Brad Dangler agreed to plead no contest to sexual battery and serve three years in prison. During the November 2015 plea hearing, the judge in the Williams County Common Pleas Court explained to Dangler that he would be required to register as a Tier III sex offender and would have an obligation to register for his lifetime.
The journal entry from the court’s sentencing hearing stated that Dangler was given a form describing his registration requirements and that the court reviewed them with the defendant. The court’s entry reported that Dangler signed an acknowledgement in court indicating he understood the requirements.
Dangler appealed to the Sixth District Court of Appeals, contending that the trial court didn’t personally inform him about the community notification requirements and residential restrictions that would be imposed on him as a sex offender. The Sixth District agreed, ruling that even if the written form included this information, the trial court didn’t tell Dangler in court about the penalties. The appeals court determined the plea was invalid.
The Sixth District notified the Ohio Supreme Court that the decision conflicts with a 2012 ruling from the Eighth District Court of Appeals (State v. Creed) and a 2014 ruling from the Second District Court of Appeals (State v. Young). The Supreme Court agreed to review the conflict.
Trial Courts Don’t Have to Inform Sex Offenders About All Penalties, State Argues
Based on Ohio Supreme Court decisions and court rules for criminal cases, courts must “substantially comply” with the need to advise defendants making guilty, no contest, or Alford pleas of the requirements mandated by their sex-offender classification, notes the Wood County Prosecutor’s Office, which is also in the Sixth District and is handling the appeal.
In State v. Veney (2008), the Ohio Supreme Court noted that when a defendant enters a plea, it must be done “knowingly, intelligently, and voluntarily.” Otherwise, the plea is unconstitutional. The notifications required by Rule 11(C)(2)(a) and (b) of the Ohio Rules of Criminal Procedure (see sidebar) involve non-constitutional rights. For these notifications, the Court has determined that substantial compliance by a trial court is sufficient. Substantial compliance is established when, based on all of the circumstances, the defendant subjectively understands the implications of the plea and the rights the defendant is waiving. According to the opinion, defendants challenging their pleas must show prejudice – that they wouldn’t have entered the plea if they understood the implications.
Looking at decisions from other state appeals courts, the prosecutor argues that failing to inform a defendant about residential restrictions and community notification requirements doesn’t mean a trial court hasn’t substantially complied with the criminal rules. When a defendant who wasn’t told of these consequences doesn’t question or object to the information provided by the court during sentencing, the defendant can’t show prejudice, the prosecutor insists.
The prosecutor suggests that the Supreme Court may want to revisit its decisions in State v. Williams (2011) and related cases. In Williams, the Court determined that R.C. Chapter 2950, which contains the laws about the automatic classification and registration of sex offenders, is punitive rather than remedial. Because these statutes are punitive, sex offenders must be told the specific penalties for their offenses, and the prosecutor argues sex offenders are given more detail about their penalties than other offenders. The prosecutor asks the Court to find Dangler’s plea valid and to overturn the Sixth District’s decision.
Trial Court Didn’t Substantially Comply with Rule, Dangler Maintains
Dangler argues that the prosecutor is trying to relitigate Williams when the only question before the Court is what constitutes substantial compliance. The Supreme Court already has determined the sex-offender statutes are punitive. For a plea to be knowing, the trial court must verbally inform the defendant at the time of the plea of the penalties resulting from sex-offender classification, Dangler argues.
Of the five punitive consequences listed in Williams, Dangler states he was told of only one. He contends that courts should be required to inform sex offenders of at least three of these – registration, community notification, and residential restrictions – to comply with Crim.R. 11. Based on the rule, a review of the totality of the circumstances ought to be limited to what the trial court verbally told the defendant, he argues. The court’s written record can be used only to clarify ambiguities, but can’t meet the rule’s requirement, Dangler states.
Taking issue with the state’s view that sex offenders are provided more detailed information than those convicted of other crimes, Dangler points out that sex offenses carry automatic penalties that other offenses don’t. In addition, Dangler argues that asking a defendant to object to the lack of information about punitive consequences provided by the trial court in order to establish prejudice is unworkable. Trial courts have a duty based on the criminal rule to explain the penalties of a sex-offender classification to ensure that the defendant knowingly enters the plea, Dangler maintains.
- Kathleen Maloney
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.
Contacts
Representing the State of Ohio from the Wood County Prosecutor’s Office: David Harold, 419.354.9250
Representing Brad Dangler: Karin Coble, 888.268.3625
Can Court Impose Community Control Sanction Consecutive to Prison Sentence?
State of Ohio v. Jeffrey Hitchcock, Case no. 2018-0012
Fifth District Court of Appeals (Fairfield County)
ISSUE: Can an offender be sentenced to community control, which may include a term of confinement in a community-based correctional facility, following concurrent prison sentences?
BACKGROUND:
In March 2016, Lancaster police determined that Jeffrey Hitchcock, who was 41 years old, had been engaged in a sexual relationship with a 15-year-old girl who lived next door. The minor gave birth to a stillborn child and identified Hitchcock as the father. Hitchcock fled, and authorities located him in Kentucky near the Tennessee border. Hitchcock submitted to a DNA test, which confirmed he was the father.
Hitchcock pleaded guilty to three counts of unlawful sexual conduct with a minor. The Fairfield County Common Pleas Court sentenced him to three consecutive five-year prison terms. The trial court suspended the third term, and imposed five years of community control to be served once the prison terms concluded. As part of the community-control conditions, the court ordered that Hitchcock be assessed for placement in a community-based correctional facility (CBCF).
Hitchcock appealed his sentence to the Fifth District Court of Appeals, arguing that the community-control sentence must run concurrently to the prison terms and not consecutively. The Fifth District affirmed the trial court’s sentence, but noted to the Supreme Court that its decision was in conflict with decisions by the Eighth and Twelfth district courts of appeal. The Supreme Court agreed to hear the appeal and address the conflict.
Law Doesn’t Allow for Additional Confinement, Offender Argues
Citing the Ohio Supreme Court’s 2018 State v. Paige decision, Hitchcock argues the trial court has no authority to order him to a CBCF following his completion of the two consecutive prison terms. He notes R.C. 2929.41(A) states that a “prison term, jail term, or sentence of imprisonment shall be served concurrently with any other prison term, jail term, or sentence of imprisonment imposed,” unless an exception in the law allows it. Hitchcock explains that none of the law’s exceptions apply to his sentence, and that the Supreme Court has ruled that confinement in a CBCF is a “sentence of imprisonment.”
Hitchcock also argues that under the reasoning of the Eighth District, the trial court can’t impose any community-control sanction that runs consecutively to a prison sentence. In 2016, the Eighth District reviewed the current practices in Cuyahoga County of imposing community control following a prison term. The Eighth District’s review was prompted by a 2015 Ohio Supreme Court case, State v. Anderson, which found judges must apply the sentencing laws as written. The Supreme Court stated because state lawmakers had not expressly granted courts the right to impose non-residential sanctions that could run consecutively to prison sentences, the sanctions couldn’t be imposed.
The Eighth District and the Twelfth District, in its 2017 State v. Ervin case, concluded that the law doesn’t allow courts to impose any type of community control following a prison sentence. Hitchcock notes that even if the Supreme Court overrules the Eighth and Twelfth districts’ decisions that no community control can be imposed, the Court should vacate the potential CBCF sanction while allowing the non-residential community controls to remain.
Additional Control Sanctions Permitted,Prosecutors Argue
The Fairfield County prosecuting attorney argues the Eighth and Twelfth districts are improperly extending the restrictions on the use of community-control sanctions. The prosecutor notes the Ohio Supreme Court’s Anderson decision didn’t allow a prison sentence and a consecutive community-control sanction for the “same felony offense.” And in the Paige decision, the Court removed the CBCF sanction after concluding the trial court didn’t make the necessary findings required by state law to impose both a prison term and a residential community control sanction, the prosecutor notes.
In Hitchcock’s case, the trial court made the findings to impose separate prison terms and community control sanctions for different felonies, the prosecutor maintains. Under R.C. 2929.11(A) trial courts have discretion to craft the sentences best suited to achieve the goals of punishing the offender and protecting the public, the prosecutor argues.
If a court can’t impose a consecutive community-control sanction, then it is forced to impose three consecutive prison sentences, which is more burdensome to the state and offender, the prosecutor asserts. Such a requirement would run counter to the sentencing goals established by the legislature, the prosecutor argues, and is an indication that a consecutive community-control sanction is permissible if the trial court makes the required findings.
- Dan Trevas
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.
Contacts
Representing Jeffrey Hitchcock: Darren Meade, 616.349.1990
Representing the State of Ohio from the Fairfield County Prosecuting Attorney’s Office: Kyle Witt 740.652.7560
Did Medical Equipment Company Wait Too Long to Assert Defense that Employees Signed Arbitration Agreements?
Edward F. Gembarski v. PartsSource Inc., Case no. 2018-0125
Eleventh District Court of Appeals (Portage County)
ISSUES:
- Is the class certification stage of a class-action lawsuit the proper time to raise defenses against expected class members?
- When the representative member in a class action who wasn’t subject to an employer’s arbitration agreement seeks to include as members of the class those who were subject to arbitration, does the class meet the class-action legal requirements?
- Does a party to a lawsuit waive the right to arbitrate by failing to assert arbitration as an affirmative defense?
BACKGROUND:
From February 2006 to August 2011, Edward Gembarski worked as an account manager in the sales department of PartsSource, which sells replacement parts for medical equipment. PartsSource compensated Gembarski and others on the sales team based on written compensation agreements. Employees earned commissions on sales, and those commissions could be reduced based on how many days it took a customer to pay a bill.
PartsSource states that in January 2011 it implemented binding arbitration agreements with employees. The agreement required employees to relinquish their right to file claims against the company in court and instead participate in a process that included mandatory and binding arbitration. The agreement contained an opt-out provision, and PartsSource states that only three full-time employees, including Gembarski, chose to opt out of the arbitration process.
Employee Challenges Commission Policy in Class Action
In October 2012, Gembarski filed a class-action lawsuit alleging that PartsSource had wrongfully and improperly withheld and deducted commissions from employees. Originally filed in Summit County, the case was transferred to Portage County. PartsSource later attempted to move the case to federal court, but the U.S. District Court for the Northern District of Ohio returned the matter to state court in September 2015.
The trial court held a hearing in June 2016 to determine whether to certify the class as defined by Gembarski, and in September the magistrate approved the class certification.
PartsSource appealed to the Eleventh District Court of Appeals, which upheld the trial court’s judgment. The appeals court determined that PartsSource had waived its right to arbitrate disputes with expected members of the class and that Gembarski met the legal requirements to establish a class.
PartsSource appealed the decision to the Ohio Supreme Court, which accepted the case.
Should Company Have Raised Right to Arbitrate Dispute Earlier?
PartsSource argues that it couldn’t raise the arbitration requirement that affected other employees against the sole class member representative – Gembarski – because he wasn’t subject to arbitration. As for the other potential members of the class, the company maintains that unnamed members aren’t parties to the case until a court certifies the class, and certification in this case wasn’t granted until 2016. The company disputes that it waived any of its defenses related to other members of the class before the class was certified.
Gembarski responds that a 1998 Ohio Supreme Court ruling quotes an authority on class actions that states, “It is settled that absent class members are passive parties to a class suit ….” Gembarski asserts that PartsSource knew at the time he filed the 2012 lawsuit that possible members of the class may have signed the arbitration agreement. Yet, he maintains, the company engaged in the ongoing litigation from 2012 to 2016 without mentioning its defense that some employees had signed binding arbitration agreements. PartsSource needed to raise that defense early in the litigation to try to avoid class certification and class-wide liability, Gembarski argues, adding that 2016 was too late for the company to raise this defense and it has been waived.
Could Employees Who Signed Arbitration Agreement Participate in Lawsuit?
Court rules set forth the requirements for class-action lawsuits. One requirement in Rule 23 of the Ohio Rules of Civil Procedure is that “the claims or defenses of the representative parties are typical of the claims or defenses of the class,” referred to as “typicality.” Another requirement states that “the representative parties will fairly and adequately protect the interests of the class,” referred to as “adequacy.”
PartsSource contends that Gembarski’s claims weren’t typical of those of the class because the other potential class members signed arbitration agreements and he didn’t. Gembarski, then, couldn’t adequately represent the class because his interests were different from the interests of employees subject to arbitration agreements, the company maintains.
The company compares this case to a 2004 decision from the Ninth District Court of Appeals (Rimedio v. SummaCare). In Rimedio, the court ruled that the representative of the class wasn’t typical of the class because some class members had contracts with arbitration clauses while the representative and other class members did not.
Gembarski states that typicality and adequacy are met when the interests of the class representative and the class members aren’t in conflict. He argues that his and the other class members’ interests are aligned because they both want the commissions returned that PartsSource wrongly took from them. He cites federal court cases that found class certification wasn’t prohibited when some of the potential class members didn’t sign arbitration agreements and others did.
Which Side Prevails when Looking at All Circumstances?
PartsSource maintains that courts must look at all of the circumstances to determine whether the company waived its right to arbitrate with employees encompassed within the class action. Besides the points already made, the company mentions that when the trial court set a date for a jury trial a year after Gembarski filed his lawsuit, he still hadn’t filed to certify the class with the court. PartsSource also states Gembarski suffered no prejudice as a result of the company raising the defense about the arbitration agreements at the time the class was certified.
Gembarski counters that a review of the totality of the circumstances supports his position. He points to the company’s years-long delay in requesting a right to arbitrate, and he notes the extent of the company’s participation in the litigation over the years. He concludes that the trial court properly certified the class and that PartsSource was obligated sooner to bring up its defense that some possible class members signed arbitration agreements.
Lawyers Representing Employers Submit Friend-of-the-Court Brief
The Ohio Management Lawyers Association has filed an amicus curiae brief in support of PartsSource.
- Kathleen Maloney
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.
Contacts
Representing PartsSource Inc.: Stephen Zashin, 216.696.4441
Representing Edward F. Gembarski: Thomas Connick, 216.364.0512
Can Regulator Cap Costs for Utility’s Energy Efficiency Programs?
In re Application of Ohio Edison Co., Case no. 2018-0379
Public Utilities Commission of Ohio
ISSUES:
- Can the Public Utilities Commission of Ohio (PUCO) impose a cost cap on an electric power distribution company’s energy efficiency and peak demand reduction program?
- Must the PUCO follow rule-making procedures to adopt a cost cap for energy efficiency and peak demand reduction programs?
- Did the PUCO adopt an arbitrary cost cap from the three FirstEnergy power distribution companies operating in northern Ohio?
BACKGROUND:
Since 2009, Ohio electric distribution utilities have been required to implement programs to increase energy efficiency and reduce energy demand during peak hours. The utilities are required to submit three-year “portfolio plans” to the Public Utilities Commission of Ohio (PUCO) showing how the power companies are expected to meet state-required benchmarks for energy savings.
In early 2016, the FirstEnergy utilities — Ohio Edison Company, Cleveland Electric Illuminating Company, and Toledo Edison Company — submitted a plan for the 2017-2019 cycle. Numerous parties intervened in the case, including consumer, business, and environmental groups. Most of the groups, not including the Ohio Consumers’ Counsel or the PUCO staff, agreed to a revised plan that was submitted to the commission for approval. The plan permitted FirstEnergy to spend $268 million on the efficiency programs along with the continuation of an $18 million low-income energy efficiency program. The utilities also would be eligible for “shared savings” incentives estimated at the time to reach nearly $47 million, but now are projected to be lower under a new federal tax law. The spending and the incentives were to be paid by FirstEnergy customers through a rider on their monthly electric bills.
The PUCO proposed a “cost cap” on the amount that customers could be charged. Using the company’s past profits as a baseline, the commission staff suggested a 3 percent cap would allow the company to spend $80 million per year on the programs. FirstEnergy objected. The commissioners noted that while FirstEnergy’s proposed plan would cost ratepayers about $111 million a year, a 4 percent cost cap would cost $107 million. The PUCO imposed the cap, and FirstEnergy as well as several environmental organizations that agreed to the company’s plan appealed to the Supreme Court, which is required to hear appeals of PUCO decisions.
Cap Not Authorized, Utility Argues
The state’s energy efficiency program requirements are established in R.C. 4928.66. The section doesn’t authorize the PUCO to impose an overall cost cap on the efficiency programs, and the PUCO can only take actions authorized by state law, First Energy argues. To reinforce its point, FirstEnergy notes that R.C. 4928.66 was enacted by the Ohio General Assembly by passage of Senate Bill 221. In the same legislation, lawmakers approved R.C. 4928.64, which does permit the PUCO to set a cost cap for companies to meet a benchmark for the sale of electricity generated by renewable energy sources. The company argues the legislature didn’t intend for the PUCO to cap the costs to meet the energy efficiency standards and authorizes utilities to recoup their costs for the program by charging customers.
Even if the PUCO claimed it had the power through the “broad discretion” granted to it by lawmakers to set utility rates, the commission could only impose a cost cap if it enacted a rule to do so, FirstEnergy maintains. And the PUCO didn’t follow the required rule-making procedure that “prescribes a legal standard that did not previously exist,” the company states. FirstEnergy maintains the cap is a legal standard and can’t be unilaterally imposed by the commission as part of a rate plan approval.
The company also challenges the evidence used by the PUCO to justify a 4 percent cap. FirstEnergy argues the historical data used by PUCO staff ignored current cost data, which shows that new energy efficiency programs are more expensive, but also produce more long-term savings for the customers.
“The Companies’ reasoned approach resulted in Revised Plans projected to generate discounted benefits to the Companies’ customers of $785 million at a total plan cost of $268 million. Critically, no party below (Staff and OCC included) challenged these calculations. Nor was there any attempt by the Commission (or any party) to explain how the proposed cost of the Revised Plans was unreasonable in light of those net benefits,” FirstEnergy’s brief states.
Plan Strikes Balance, Commission Maintains
The PUCO argues that while energy efficiency is good for consumers, the rates for the programs must operate at reasonable levels because customers pay up front for future benefits. The commission argues it used its authority granted by state law to strike a balance that allows FirstEnergy to meet its energy saving requirements while not overburdening customers. The commission notes the current energy efficiency riders are one of the highest-cost riders on residential consumers’ electric bills, averaging between $1.98 and $2.90 per month. The commission states that FirstEnergy in the past has spent less than its budgeted amount and achieved more than enough power savings to meet the state standards. The commission argues it imposed the cost cap because FirstEnergy has been budgeting to pay for efficiency programs that will more than exceed their standard, then will recoup more in shared savings profits, which results in rising charges to its customers.
Citing the Ohio Supreme Court’s 1991 Kazmaier Supermarket Inc. v. Toledo Edison Co. decision, the PUCO argues it has “broad authority to administer and enforce the provisions of R.C. Title 49,” and can regulate the program without any specific law stating it can impose cost caps. The commission maintains that since the law doesn’t prohibit cost caps, it is within its power to approve a rate that is “just and fair.”
The commission maintains the cap isn’t a rule, and that it didn’t need to adopt a rule through a rule-making process in order to cap the costs. The PUCO notes the cap also isn’t a rule because it is neither generally nor uniformly imposed on all Ohio utilities. The PUCO notes it has previously placed 4 percent cost caps on American Electric Power (AEP) and Dayton Power & Light (DP&L) efficiency plans in uncontested rate cases.
The PUCO also maintains it provided adequate information to support its imposition of the cost caps and complied with R.C. 4903.09 requirements, which states that the PUCO must clearly explain the basis for its decisions.
Intervening Parties Divided on Cost Caps
The Environmental Law & Policy Center, Natural Resources Defense Council, Ohio Environmental Defense Council, and Environmental Defense Fund collectively filed a brief stating their support for the FirstEnergy proposal without the cap. The groups note the 4 percent cap is calculated on a company profit formula that doesn’t make the cap apply uniformly among electricity providers across the state. They argue the cap actually provides FirstEnergy less money per capita to spend on efficiency programs than what is granted to AEP or DP&L. They assert FirstEnergy should be able to spend more and invest in efficiency programs that over the long term will save consumers more money and protect the environment.
The consumers’ counsel joined the PUCO in supporting the caps. The office argues that FirstEnergy is intentionally over-budgeting for the plans in order to recoup more profits from its customers through the shared savings incentives. The consumers’ counsel brief states that FirstEnergy is free to spend above the PUCO cap on energy efficiency programs, but that extra money would have to come from company shareholders, not from customers.
Friend-of-the-Court Brief Submitted
An amicus curiae brief supporting FirstEnergy’s position has been submitted by Ohio Partners for Affordable Energy. The group states its purpose is to advocate for affordable energy policies for low- and moderate-income Ohioans, and its members include non-profit organizations that provide bill payment assistance as well as companies that offer weatherization and energy efficiency services.
- Dan Trevas
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.
Contacts
Representing the FirstEnergy Companies: Michael Gladman, 614.281.3865
Representing the Environmental Law & Policy Center: Madeline Fleisher, 614.569.3827
Representing the Environmental Defense Fund and the Ohio Environmental Council: Miranda Leppla, 614.487.5825
Representing the Natural Resources Defense Council: Robert Dove, 614.943.3683
Representing the Public Utilities Commission of Ohio from the Ohio Attorney General’s Office: John Jones, 614.466.4397
Representing the Ohio Consumers’ Counsel: Christopher Healey, 614.466.9571
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