Listen to this articleCivil
Attorney Discipline
Disbarment
In May 2020, the Supreme Court indefinitely suspended respondent Ana L. Pena without the right to petition for reinstatement for 18 months for, among other violations, misappropriation of client funds. Pena never petitioned for reinstatement. On October 7, 2024, the Director of the Minnesota Office of Lawyers Professional Responsibility filed a second Petition for Disciplinary Action against Pena alleging two counts. First, the Director alleged that Pena committed theft of over $94,000 from her Texas-based law firm and one of its partners, constituting fraud and dishonesty in violation of Rule 8.04(a)(3), Texas Disciplinary Rules of Professional Conduct (TDRPC). Second, the Director alleged that Pena’s failure to cooperate with the Director’s investigation violated Rule 8.1(b), Minnesota Rules of Professional Conduct (MRPC), and Rule 25, Rules on Lawyers Professional Responsibility (RLPR). Pena did not respond to this petition. The Director argued for disbarment.
The Supreme Court held that disbarment was warranted where respondent misappropriated more than $94,000 from her employer while suspended for having previously misappropriated client funds. Disbarred.
A24-1737 In re Pena (Original Jurisdiction)
News Media
Confidential Sources
This case arose from a North Dakota lawsuit filed by appellants, corporate entities involved in the planning, construction, and operation of the Dakota Access Pipeline, against defendant environmental advocacy organization and several other defendants. The North Dakota suit arose from the defendants’ alleged actions related to the 2016 protests over the pipeline. Respondent, a Minnesota-based news organization, and member-journalist were present at and reported on the protests. Believing that respondent had documents and information relevant to the North Dakota suit, appellant served subpoenas duces tecum on respondents seeking information related to the protests. Respondents objected to the subpoenas, directing appellant to its published materials and claiming that all other potentially responsive documents were privileged. Appellants filed a motion to compel respondents to produce the requested documents. At issue here was whether the Minnesota Free Flow of Information Act (MFFIA) applies when a newsgatherer engages in unlawful or tortious conduct while reporting.
The Supreme Court held that (1) the MFFIA does not contain an exception—beyond the statutory exceptions contained in Minn. Stat. §§ 595.024–.025—for newsgatherers who allegedly engage in unlawful or tortious conduct of the kind presented in this case; and (2) the MFFIA does not prohibit the District Court from ordering production of a privilege log. Affirmed in part, reversed in part, and remanded.
A23-1284 Energy Transfer LP v. Greenpeace Int’l (Court of Appeals)
Receiverships
Equitable Subrogation
This appeal arose from a dispute between a surety bond company, appellant, and a creditor bank, respondent, regarding entitlement to funds held by a receiver in a receivership action. Appellant issued payment bonds to defendant for public works projects. Defendant defaulted on the public works projects. Defendant also defaulted on loans from respondent. At issue was whether appellant or respondent has priority to the bonded contract funds held by the receiver. Appellant argued that it had priority as a performing construction surety under the doctrine of equitable subrogation because it paid laborers and suppliers for their work on the projects. Respondent argued that it had priority under the UCC because respondent perfected its security interests in defendant’s accounts receivable before appellant issued the payment bonds.
The Supreme Court held that (1) a performing construction surety need not show any mistake of fact to exercise its right of equitable subrogation; and (2) a surety’s right to equitable subrogation is not a security interest subject to the UCC and the UCC’s first-in-time priority rule. Instead, through the doctrine of equitable subrogation, a performing surety has priority over a secured creditor as to contract funds created by the surety’s performance on its bond obligations. Reversed and remanded.
A23-1478 In re Receivership of United Prairie Bank (Court of Appeals)
Workers’ Compensation
Mental Impairment
At issue in this case was whether the Workers’ Compensation Court of Appeals (WCCA) erred in affirming the compensation judge’s determination that respondent-employee was entitled to workers’ compensation benefits under Minn. Stat. § 176.66 for a mental impairment. Also at issue was whether the WCCA erred in affirming the compensation judge’s award of penalties against the employer, City of Minneapolis. The City argued that the WCCA committed errors of law by (1) affirming the compensation judge’s determination that respondent was entitled to workers’ compensation benefits for a present diagnosis of post-traumatic stress disorder (PTSD); (2) sua sponte referring the case back to the compensation judge for a finding regarding respondent’s claim for benefits based on a diagnosis of other specified trauma and stressor-related disorder (OSTD) as a consequential mental injury of PTSD; (3) affirming the compensation judge’s determination following the referral that respondent was entitled to workers’ compensation benefits for OSTD as a consequential mental injury of PTSD; and (4) affirming the compensation judge’s award of penalties against the City for frivolous denial of liability.
The Supreme Court held that (1) the WCCA did not err in affirming the compensation judge’s finding that the employee has a compensable mental injury because that finding is not manifestly contrary to the evidence, which included testimony by a licensed professional psychologist that, based on the most recent edition of the Diagnostic and Statistical Manual of Mental Disorders, the employee has a present diagnosis of PTSD; (2) the WCCA erred in addressing the employee’s argument that he was entitled to compensation benefits for a diagnosis of OSTD as a consequential mental injury of PTSD because that issue was moot given the record here, where the employee’s expert psychologist opined that the employee’s OSTD diagnosis was “subthreshold PTSD” and the WCCA decided that the employee was entitled to compensation benefits for a present diagnosis of PTSD; and (3) the WCCA did not err in affirming the compensation judge’s award of a penalty for frivolous denial of primary liability. Affirmed in part and reversed in part.
A24-1205 Peterson v. City of Minneapolis (Workers’ Compensation Court of Appeals)
Criminal
Postconviction Relief
Equal Protection
This case concerned pro se petitioner’s third petition for postconviction relief. Petitioner was convicted of first-degree premeditated murder and several other offenses related to the murder of his ex-wife in 2011. He was sentenced to life in prison without the possibility of release. Petitioner’s petition for postconviction relief contained several claims that petitioner asserted entitle him to reversal of his convictions. First, Munt argues that the United States Supreme Court’s decision in Dobbs v. Jackson Women’s Health Organization, 597 U.S. 215 (2022), reversing its recognition of a federal constitutional right to abortion, rendered his conviction for first-degree premeditated murder invalid on equal protection grounds.
The Supreme Court held that (1) the District Court did not abuse its discretion by denying petitioner’s petition for postconviction relief as to his equal protection claim; and (2) the District Court did not abuse its discretion by denying petitioner’s petition for postconviction relief as to his claims of entrapment, trial counsel’s disregard of his “defense objective of choice,” and witness tampering. Affirmed.
A24-0259 Munt v. State (Blue Earth County)
Postconviction Relief
New Interpretation of Law
Almost 30 years after petitioner’s conviction for first-degree murder was affirmed, pro se petitioner filed a petition for postconviction relief raising several issues and asking for a new trial. The District Court denied the petition without an evidentiary hearing, reasoning that it was untimely. On appeal from the postconviction denial, petitioner raised two issues he asserted in the District Court and makes a new argument for the first time. First, petitioner claimed that the trial judge committed several procedural errors when the jury reported it was deadlocked during deliberations. Second, petitioner argued that the Supreme Court erred in its 1995 decision on petitioner’s direct appeal from his conviction when we did not order the District Court to conduct a Schwartz hearing to address allegations of juror misconduct. Finally, in his briefs on appeal, petitioner asserted for the first time that his postconviction claims were timely because the United States Supreme Court recently issued a decision overruling Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984). Petitioner claimed that under Loper Bright, the court no longer needed to defer to its past decisions or the District Court’s past determinations in this case.
The Supreme Court held that the new-interpretation-of-federal-or-state-law exception to the two-year time bar set forth in Minn. Stat. § 590.01, subd. 4(b)(3), did not apply to petitioner’s claims for postconviction relief. Affirmed.