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Indiana Court Decisions - Nov. 13 to 22, 2013

IL Staff
December 4, 2013
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7th Circuit Court of Appeals

Nov. 22

Civil – Robo-Call Statute

Patriotic Veterans Inc. v. State of Indiana, et al.

11-3265

The 7th Circuit Court of Appeals reversed the decision by a federal judge that Indiana’s Automated Dialing Machine Statute is preempted by the federal Telephone Consumer Protection Act. The injunction entered against enforcing the law had been stayed by the appellate court pending appeal.

Patriotic Veterans Inc., an Illinois nonprofit, challenged the state statute because it wanted to make automated calls – or robo-calls – to Indiana residents that delivered political messages related to a particular candidate or issue. The organization filed a complaint seeking a declaration that the law is invalid because it violates the First Amendment as it applies to political messages, and that the law is preempted by the TCPA.

Judge William Lawrence ruled in September 2011 that the U.S. law preempted the state statute and granted Patriotic Veterans’ request for an injunction.

The 7th Circuit, looking at the TCPA, held that it does not expressly or impliedly preempt the Automated Dialing Machine Statute.

“The Indiana law is more restrictive than the federal law, but in no way does it frustrate any process that the federal statute requires,” Judge Ilana Diamond Rovner wrote. In fact, the TCPA says nothing about preempting laws that regulate the interstate use of automatic dialing systems. Therefore, we must conclude that they are not preempted.”

The judges noted other courts have reached the same conclusion when considering federal preemption by the TCPA of similar state statutes.

“Because the district court decided the case on the basis of preemption, it never had reason to address the arguments regarding the constitutionality of the statute. We are a reviewing court and think that the argument would benefit from two-tiered examination. We thus reverse the ruling on preemption and remand for an evaluation of whether Indiana’s statute violates the free speech rights protected by the First Amendment to the United States Constitution,” Rovner wrote.
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Indiana Supreme Court

Nov. 13

Civil Plenary – Public-Private Agreement Statute

Julie Kitchell v. Ted Franklin, as the Mayor of the City of Logansport, and the Common Council of the City of Logansport

09S00-1307-PL-476

Local units of government may engage in preliminary talks or solicit prospective public-private partners before those units of government have adopted legislation enabling such agreements, the Indiana Supreme Court ruled in a challenge to Logansport’s efforts to overhaul a coal-burning power plant.

“In this case we address whether Indiana’s Public-Private Agreements statute requires a local legislative body to first adopt the statute before it may issue a request for proposals or begin contract negotiations as provided for under the statute. We hold it does not,” Justice Robert Rucker wrote for the court.

Kitchell sued the city of Logansport over plans to convert a coal-burning plant to one that would generate electricity by burning refuse. The trial court dismissed her claim that sought to invalidate a city ordinance, arguing that before the city could issue an RPF for a public-private agreement, it was required to have an ordinance in place allowing such agreements.

But justices noted that the city had reached no agreements prior to adopting enabling legislation. Referring to I.C. 5-23-5-2, -5, -9, Rucker wrote, “nowhere does the Act require a political subdivision to ‘adopt’ the Act before taking any further action consistent with the Act.”

Justices rejected the city’s request that Kitchell pay attorney fees.
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Nov. 19

Civil Tort – Service of Notice

Gersh Zavodnik v. Michela Rinaldi, et al.

49S05-1311-CT-759

The Indiana Supreme Court reversed dismissal of a case because of questions about whether a defendant had properly been served notice.

Justices reinstated the case which Marion Superior Judge Patrick McCarty ordered dismissed because evidence presented as proof of notice was in Italian, because the defendant lived in Italy. The Court of Appeals noted the service also was in English, but affirmed dismissal on the grounds that Zavodnik failed to cite relevant law.

“Under the unique circumstances presented, the Court concludes that the trial court’s order of dismissal should be reversed. We grant transfer of jurisdiction, reverse the order of dismissal, and remand to the trial court for further proceedings, without prejudice to dismissal under Trial Rule 41(E) if warranted after further consideration,” the court wrote in a two-page per curiam opinion.
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Nov. 21

Criminal – Search & Seizure

Danielle Kelly v. State of Indiana

30S01-1303-CR-220

The Indiana Supreme Court reversed the admittance of statements a woman made to police after a concerned citizen set up a sting operation attempting to catch an alleged drug dealer. The justices held that the warrantless seizure of Danielle Kelly’s person and vehicle violated her constitutional rights.

Kelly rode with her cousin Lamont Day to the home of Carolyn Goodwin. Goodwin had contacted police and told them she arranged to purchase cocaine from a man who she said was selling drugs to her friends at Fortville bars. Goodwin had never been a confidential informant and she did not provide the man’s name or physical description of him or his car, but that man turned out to be Day. Goodwin never mentioned Kelly.

When the two arrived at Goodwin’s home, police ordered Day and Kelly out of the car. Police questioned Kelly who said she knew about the cocaine in the car. Then police read her the Miranda warning, and Kelly again said she knew about the drug. She was charged with two Class A felonies: dealing in and possession of cocaine within 1,000 feet of a public park or youth program center.

On interlocutory appeal, the Indiana Court of Appeals affirmed the admittance of the cocaine found in the search of the vehicle and Kelly’s statements to police after she received the Miranda warning.

The justices held that the circumstances of the case constitute an arrest that must be supported by probable cause. The police came to Goodwin’s house based on her attempted sting operation, but they never corroborated the claim that Day had cocaine and he intended to sell it. Plus, Goodwin never told police anything about Kelly.

The high court also held that the plurality opinion in Missouri v. Siebert, 542 U.S. 600, 617 (2004), prohibits the admission of Kelly’s statements to Fortville Police Chief Benjamin Kiphart. The questioning of Kelly and her statements to police prior to being read her Miranda rights and the responses of Kiphart based on her statements led the justices to believe the references to Kelly’s pre-warning admission “inevitably diluted the potency of the Miranda warning such that it was powerless to cure the initial failure to warn, even if that failure was a product of a good-faith mistake,” Justice Mark Massa wrote.

“Although we have no knowledge of, and thus can express no opinion regarding, Chief Kiphart’s motives, we believe our jurisprudence, as well as that of our colleagues, makes it clear that Miranda requires a ‘warn-first practice,’” Massa continued.

He pointed out that officers may still, under Oregon v. Elstad, 470 U.S. 298, 318 (1985), cure a good-faith mistake by administering a proper warning before proceeding with further questioning. But, as in this case, that cure was impossible when it was followed by explicit references to a pre-warning incriminating statement.
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Nov. 22

Trust – Purchase Agreement

Harold O. Fulp, Jr. v. Nancy A. Gilliland

41S01-1306-TR-426

The Indiana Supreme Court accepted a revocable trust case to answer the first impression question: While a trust is revocable, whom does the trustee serve? The justices concluded that an Indiana woman, as trustee, served herself.

Harold Fulp Jr. sought specific performance of the purchase agreement he made with his elderly mother to buy the family farm at a discounted price. Ruth Fulp placed the farm in a revocable trust and was the trustee, primary beneficiary and settlor. Her daughter Nancy Gilliland, who became successor trustee after Ruth Fulp resigned as trustee, refused to proceed with the sale. Fulp Jr. had purchased the farm at the same per-acre discount that Gilliland had paid when she previously purchased another portion of the farm.  

The trial court denied specific performance because it found Ruth Fulp breached her fiduciary duty to her children by selling the farm at a low price and Fulp Jr. breached his fiduciary duty as a beneficiary by participating in the sale. The Indiana Court of Appeals affirmed, believing Ruth Fulp had sold the farm as settlor, not trustee.

“Nancy sought transfer, asking us to decide whether the trustee of a revocable trust owes a duty to the settlor alone or also to the remainder beneficiaries,” Justice Loretta Rush wrote. “We granted transfer to address that issue, and we conclude that while a revocable trust is revocable, the trustee only owes a duty to the settlor. Therefore, Ruth was free to sell the farm as trustee, as the purchase agreement reflected, without breaching any fiduciary duty. And since Ruth owed her children no duty as trustee, she had no need to sell the farm as settlor, as the Court of Appeals concluded—nor would the facts in this case support any intent to amend the Trust.”

Ruth Fulp’s fiduciary duty was to herself, as settlor and primary beneficiary. That duty does not extend to her beneficiary children, because that would mean she was serving two masters, the justices held. Such conflicting duties would essentially make the trust irrevocable because complying as trustee with her own wishes to revoke the trust would breach the purported duty to the remainder beneficiaries by placing her own interests above theirs.

Since the trial court misinterpreted the trust and law by determining Ruth Fulp had a duty to her children that she breached and Fulp Jr. aided in that breach, the court abused its discretion in denying specific performance, Rush wrote.
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Indiana Court of Appeals

Nov. 13

Civil Plenary – Noncompete Agreement

Robert Kuntz, Kunodu, Inc., and B-K Interests, LLC v. EVI, LLC

02A03-1301-PL-14

In reviewing a dispute over the terms of a noncompete agreement, the Indiana Court of Appeals reminded the trial court that a preliminary injunction has limits.

Even though the Court of Appeals affirmed the preliminary injunction against Robert Kuntz, it determined the trial court had erred when it extended the duration of the noncompete and awarded attorney fees.

Kuntz sold his business repairing electric auto parts and leased the company’s property to JS Hare Inc. in 2007. At that time, Kuntz entered into a noncompete agreement prohibiting him from doing similar work for the next seven-and-a-half years.

In December 2011, JS Hare sold its assets to EVI, LLC. Several months later, after EVI became concerned that Kuntz was violating his noncompete, it filed suit and requested a preliminary injunction.

The Court of Appeals ruled that the trial court did not abuse its discretion in granting a preliminary injunction against Kuntz.

However, the COA pointed out the purpose of a preliminary injunction is to preserve the status quo until the court can issue a ruling on the dispute.

Therefore, since the last uncontested position of the parties was that the noncompete agreement expired in October 2014, the trial court should not have tacked on additional months. Also, since neither party had prevailed with a judgment or settlement that grants the relief sought, the lower court erred by awarding attorney fees to EVI.
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Criminal – Bond/Abuse of Discretion

Charles Cole v. State of Indiana

49A02-1308-CR-680

A trial court abused its discretion when it raised a defendant’s bail in a meth possession case, the Indiana Court of Appeals ruled.

Marion Superior Judge Jose Salinas initially set Charles Cole’s bond at $2,500 surety on the Class D felony charge, and the state did not object. Cole’s public defender, though, asked the court to reduce the bond to $1,500, to which the state did object.

Salinas responded to the request by giving Cole a copy of his criminal record and questioning him about his more than a dozen felony and misdemeanor convictions between 1987 and 2010, after which bond was raised to $10,000 surety.

Cole since has pleaded guilty to the charge, but the court in a footnote wrote that it granted his request to proceed with the appeal as a matter of great public interest. Judge Elaine Brown noted in the unanimous opinion reversing the increased bond that Cole argued no new evidence supported the increase and that the unusually high bail was twice as high as the maximum provided by Marion County’s local rules.

“The State does not point to any other statutory authority which would support the trial court’s order increasing Cole’s bail. The requirements for increasing bail under Ind. Code § 35-33-8-5 were not satisfied, and the trial court abused its discretion in increasing Cole’s bail,” Brown wrote for the panel that also included Judges Edward Najam and Paul Mathias.
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Criminal – Traffic Stop/Canine Search

State of Indiana v. Molly Gray

62A01-1303-CR-108

A southern Indiana trial court rightly suppressed drug evidence gathered after a police drug-sniffing dog indicated the presence of meth in a van after a traffic stop.

Cannelton police officer Micah Jackson followed a van driven by Molly Gray for some time after it failed to signal a turn, and the officer pulled over the van around 3 a.m. on Aug. 13, 2012. A short time later, Jackson had his canine conduct a free-air sniff around the van, which led to the discovery of a plastic baggie containing methamphetamine beneath a floorboard and a Class D felony meth possession charge against Gray.

Jackson later testified that he’d received information from an officer from Tell City that the driver was involved in illegal narcotics, but Jackson had no knowledge of specifics or the source of the information.

The opinion notes Jackson didn’t report Gray’s information to dispatch before starting the canine’s free-air sniff because Gray’s sister is a Tell City police dispatcher and Gray’s brother-in-law is a Perry County sheriff’s deputy, and Jackson testified he feared they might interfere in the investigation.

Gray succeeded in convincing Perry Circuit Judge Karen Werner to suppress the evidence, and the Court of Appeals affirmed on interlocutory appeal. The court treated the information Jackson acted on as an anonymous tip insufficient for reasonable suspicion.

“Without addressing the validity of the initial stop, we conclude that the free-air canine sniff was not conducted incidental to the traffic stop and so required reasonable suspicion to justify increasing the duration of the stop,” Judge Cale Bradford wrote in the opinion joined by Judges Mark Bailey and Melissa May.

“Finding that Officer Jackson lacked reasonable suspicion, we hold that the seizure was a violation of the Fourth Amendment and that the trial court did not err in suppressing the evidence.”
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Nov. 14

Civil Tort – Uninsured Motorist Claim

Darliss Wert and Gary Wert v. Meridian Security Insurance Company

15A01-1306-CT-252

The Indiana Court of Appeals agreed with a couple that their auto insurance policy is ambiguous because the two-year contractual limitation provision conflicts with another provision requiring full compliance with the contract.

Darliss Wert was injured in an accident Jan. 16, 2009, that was caused by Barbara Offill’s negligent driving. Darliss and Gary Wert’s attorney informed their insurer, Meridian Security Insurance Co., in March 2010 that the couple had an underinsured-motorist claim because Offill only had $100,000 of liability insurance. The Werts accepted the $100,000 settlement from Offill’s insurance company Jan. 18, 2011, but that money would not be available to the Werts until early February 2011. Meridian offered to settle the Werts’ underinsured-motorist claim for $5,000 in December 2011. The Werts filed their complaint seeking the benefits Feb. 24, 2012, more than two years after the accident.

The trial court granted summary judgment for the insurer, which argued it was entitled to summary judgment because the claim was filed after the expiration of the contractual limitation period.

The insurance contract in this case states that no legal action will be permitted against the insurance company unless there has been “full compliance with the terms of this policy.” The restriction is amended by only allowing a lawsuit to be brought against the insurance company as long as it is brought within two years of the date of the accident.

The two-year restriction is in direct conflict with the endorsement amending the requirements of the underinsured-motorist coverage, the appellate judges found, because Meridian will not pay underinsured-motorist benefits to its policyholder until the claim has either been resolved or settled with the underinsured motorist.

“Meridian’s policy prohibits the Werts from filing any lawsuit against it for an underinsured-motorist claim until the limits of Offill’s liability coverage have been exhausted. At the same time, Meridian attempts to prevent the Werts from filing more than two years after the date of the accident, potentially requiring them to file a lawsuit before they are in full compliance with the policy,” Judge Nancy Vaidik wrote. “Unless a policyholder settles with an underinsured motorist within two years of the collision, these provisions are in direct conflict and therefore ambiguous.”

The case was remanded for further proceedings.
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Nov. 19

Criminal – Sentence/Child Molesting

Anthony Scott Bratcher v. State of Indiana

90A02-1301-CR-3

A man’s 15-year executed prison sentence for a conviction of child molesting was affirmed by a Court of Appeals panel, but one judge found the conditional probation restrictions on activities involving children unconstitutionally vague.

The appeals panel affirmed the Class B felony conviction imposed in Wells Circuit Court after Anthony Scott Bratcher pleaded guilty to molesting a 5-year-old girl when he was 18.

The panel found the sentence was not inappropriate and that Bratcher had not received the maximum sentence because five years of the 20-year term was suspended to probation.

“While Bratcher’s troubled childhood that resulted in juvenile adjudications and placement in juvenile facilities is a consideration in a review of his character, so too is his behavior while in those juvenile facilities,” Judge Rudolph R. Pyle III wrote for the panel that included judges Michael Barnes and Terry Crone.

“Bratcher repeatedly violated probation under his various dispositional orders. Most significant of all these violations was that Bratcher committed child molesting while on juvenile probation for theft,” prior to the instant case.

Crone concurred in the opinion except for its ruling affirming a condition of probation that restricted his interaction with children. The condition: “You shall not participate in any activity which involves children under 18 years of age, such as, but not limited to, youth groups, Boy Scouts, Girl Scouts, Brownies, 4-H, YMCA, YWCA, or youth sports teams, unless given permission by the Court.”

As he did in Collins v. State, 911 N.E.2d 700, 707 (Ind. Ct. App. 2009), trans. denied, Crone wrote in a one-paragraph dissent, “I believe that condition is unconstitutionally vague. Therefore, I respectfully dissent as to that issue.”
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Nov. 20

Criminal – Evidence/Possession of Paraphernalia

Tony Sluder v. State of Indiana

03A01-1305-CR-208

Because the state did not introduce evidence that a man intended to use a syringe found in his pocket after being stopped by police to inject a controlled substance into his body, his conviction for Class A misdemeanor possession of paraphernalia must be reversed, the Indiana Court of Appeals concluded.

The judges overturned the conviction, in which Tony Sluder argued insufficient evidence to show he intended to use the syringe to introduce a controlled substance into his body.

Sluder was riding his moped when stopped by Columbus police officer Troy Love, who recognized Sluder and confirmed he had outstanding warrants. When Love searched Sluder, he did not find the syringe. Officer Angela Owens, who responded to a call to transport Sluder to jail, searched Sluder again and found the syringe.

Sluder initially denied the syringe was his, then later claimed the syringe was his sister’s, which he used to feed puppies after their mother was killed. It was in his pocket because he fed the puppies earlier that day. He was convicted at a bench trial after the judge found Sluder’s and his sister’s testimony not credible.

“The State argues in its brief that Sluder exhibited behavior indicating a consciousness of guilt because he denied that the syringe was his but testified to a different story at trial and allegedly hid the syringe,” Judge Nancy Vaidik wrote. “Merely denying ownership of an item without more is insufficient to indicate a consciousness of guilt. Second, there is no evidence that Sluder hid the syringe when he was arrested. … The mere fact that the syringe was not found until the second search is not evidence that Sluder hid the syringe.”
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Civil Tort – Immunity/Medical Malpractice

Thomas Haggerty and Cathy Haggerty v. Anonymous Party 1, Anonymous Party 2, and Anonymous Party 3

53A01-1210-CT-472

The three unidentified entities involved in the detention of a Bloomington man for several days after he refused in-patient treatment for alcoholism are entitled to immunity in his lawsuit alleging medical malpractice, the Indiana Court of Appeals ruled.

Thomas and Cathy Haggerty filed the lawsuit against the entities identified by the court as Anonymous Party 1, 2 and 3 after Thomas Haggerty refused to stay at the AP1 facility and threatened to walk home to Bloomington from Indianapolis on a cold winter night. Haggerty had been hospitalized for complications due to alcoholism and was to receive in-patient treatment in Indianapolis. He did not want to stay, which led to AP2 being called. AP2, a nearby medical facility, picked up Haggerty and detained him. AP3, a corporate entity related to AP2, was also named in the Haggertys’ proposed complaint for medical malpractice and subsequent lawsuit.

All three parties argued they were immune from liability under I.C. 12-26-2-6, which grants immunity to those who assist or participate in proceedings for an individual’s detention or commitment. The trial court granted AP1’s motion for summary judgment, but denied it related to the other parties. The Haggertys appealed the grant of summary judgment. AP2 and AP3 filed a belated motion to certify the trial court’s order for interlocutory appeal. The trial court granted the belated motion, and the COA accepted jurisdiction over the combined appeal.

The Haggertys argued that the trial court did not have jurisdiction to rule on the issue of immunity because that issue was reserved for the medical review panel, as well as that none of the anonymous parties are entitled to immunity under Indiana law because they violated Haggerty’s personal or civil rights.

The COA found the trial court had jurisdiction to rule on the issue of immunity because it is an affirmative defense.

“The trial court did not need an expert opinion to determine whether the anonymous parties could claim immunity under Section 12-26-2-6; this is a legal determination that the court was capable of making on its own,” Judge Nancy Vaidik wrote.

All three judges on the panel agreed AP1 is entitled to immunity. Vaidik and Judge Ezra Friedlander found AP2 and AP3 are entitled to immunity and reversed the denial of their motions for summary judgment.

But Judge John Baker dissented from his colleagues’ decision to grant summary judgment for AP2 and AP3 on the immunity issue. Baker believed Haggerty’s testimony that he was placed in a small bathroom for four hours before being admitted to AP2 creates a genuine issue of material fact. This is the type of issue the medical review panel should assess to determine whether the actions of AP2 were appropriate, he wrote.
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Nov. 21

Civil Tort – Subject Matter Jurisdiction/Negligence

B.R., a Minor, by his Guardian, Teresa Todd v. State of Indiana, Indiana Department of Child Services, Morgan County Office of Department of Child Services, and Adult and Child Mental Health Center

55A05-1212-CT-639

A Morgan County court erred when it granted Adult and Child Mental Health Center Inc.’s motion to dismiss a lawsuit filed on behalf of a child in foster care who suffered severe brain damage from a near-drowning. The center argued the complaint was subject to the Indiana Medical Malpractice Act.

B.R. was 3 years old when he was placed in therapeutic foster care and referred to the health center. He had disruptive behavior disorder and was significantly developmentally delayed. He was placed with foster parents, and a health center employee supervised the placement and served as B.R.’s case manager. The center has a contract with the Department of Child Services to facilitate these types of placements.

In 2007, while B.R. was placed in respite care with therapeutic foster parents Mark and Penny Hughes, he ran onto an adjacent property, entered a pool and nearly drowned, resulting in serious damage to his brain.

The health center sought to dismiss the lawsuit that alleged it breached its duty to B.R. by failing to adequately supervise his foster parents, the Hugheses’ property, and other claims. It alleged that B.R.’s action is a malpractice claim against a health care provider, which claim is subject to review by a medical review panel, and that since B.R. had not submitted his claim through the review panel process, the trial court lacked subject matter jurisdiction. The Morgan Superior Court granted the center’s motion to dismiss.

The Court of Appeals found that the health center’s authority to make therapeutic foster care placements arises solely from its contract with DCS. The appellate court also held that the center was not providing health care to B.R. when it placed him with the Hugheses, as defined under I.C. 34-18-2-18. The judges rejected the center’s argument that the claim should first go before a medical review panel.

“The issues presented in this case surrounding B.R.’s case manager’s alleged negligence are unquestionably within the understanding of the average lay juror. A medical professional is no better equipped than the average juror to consider whether the case manager complied with the appropriate standard of care,” Judge Paul Mathias wrote.

“The allegations in B.R.’s complaint, i.e. that his case manager negligently placed him with the respite therapeutic foster parents and negligently failed to inform the foster parents that B.R. was an overly active child known to run from adults and escape his home, are not directly related to any medical care B.R. received from the Health Center. Furthermore, the foster care placement was not made by a health care professional. Because B.R.’s claims sound in general negligence, his claims fall outside the Medical Malpractice Act.”•

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  1. Such things are no more elections than those in the late, unlamented Soviet Union.

  2. It appears the police and prosecutors are allowed to change the rules halfway through the game to suit themselves. I am surprised that the congress has not yet eliminated the right to a trial in cases involving any type of forensic evidence. That would suit their foolish law and order police state views. I say we eliminate the statute of limitations for crimes committed by members of congress and other government employees. Of course they would never do that. They are all corrupt cowards!!!

  3. Poor Judge Brown probably thought that by slavishly serving the godz of the age her violations of 18th century concepts like due process and the rule of law would be overlooked. Mayhaps she was merely a Judge ahead of her time?

  4. in a lawyer discipline case Judge Brown, now removed, was presiding over a hearing about a lawyer accused of the supposedly heinous ethical violation of saying the words "Illegal immigrant." (IN re Barker) http://www.in.gov/judiciary/files/order-discipline-2013-55S00-1008-DI-429.pdf .... I wonder if when we compare the egregious violations of due process by Judge Brown, to her chiding of another lawyer for politically incorrectness, if there are any conclusions to be drawn about what kind of person, what kind of judge, what kind of apparatchik, is busy implementing the agenda of political correctness and making off-limits legit advocacy about an adverse party in a suit whose illegal alien status is relevant? I am just asking the question, the reader can make own conclsuion. Oh wait-- did I use the wrong adjective-- let me rephrase that, um undocumented alien?

  5. of course the bigger questions of whether or not the people want to pay for ANY bussing is off limits, due to the Supreme Court protecting the people from DEMOCRACY. Several decades hence from desegregation and bussing plans and we STILL need to be taking all this taxpayer money to combat mostly-imagined "discrimination" in the most obviously failed social program of the postwar period.

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