# Opposition Brief — SSC Odin Operating Operating Co., LLC v Carter (No. 08-805)

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 2008

## Text

Q a a
WW | APR 3.0 2009

No. 08-805

OFFICE OF THE CLERK

In The
Supreme Court of the United States

2

SSC ODIN OPERATING COMPANY LLC,
D/B/A ODIN HEALTH CARE CENTER,

Petitioner,

V.

SUE CARTER, SPECIAL ADMINISTRATOR
OF THE ESTATE OF JOYCE GOTT,

Respondent.

— +

On Petition For A Writ Of Certiorari
To The Appellate Court Of Illinois,
Fifth District

>

RESPONDENT'S BRIEF IN OPPOSITION

*
STACI M. YANDLE K. GLENDA CAMERON
7012 West Main St Counsel of Record
Belleville, [IL 62223 2006 Eastern Suburb.
(618) 394-9600 Suite 101

Christiansted, VI 00820
(340) 773-3444

Attorneys jor Respondent

April 30, 2009

QUESTION PRESENTED

The Appellate Court of Illinois, Fifth District,
affirmed the denial of petitioner’s motion to compel
arbitration. Should respondent be compelled to
arbitrate one of her claims, even though no valid
arbitration agreement exists between the parties?

ll

TABLE OF CONTENTS

Page

Bee PSN EIEN os cnescuuhvesauevercensneeuvanevacenits ate i

STATEMENT OF THE CABE......1cscccscccescncssessccontens 2

REASONS FOR DENYING THE WRIT ............... 4
I. There Is No Valid Agreement to Arbitrate

Respondent’s Wrongful Death Claim ........ 5

A. The FAA Does Not Require Courts to
Force Arbitration on Parties Who
Have Not Agreed to Arbitrate. ............ 5

B. The Illinois Court of Appeals, Fifth
District, Applied Established and
Routine Principles of State Contract
ee NEN ee ene ok kc ths 7

Il. There Is No Split in Authority on the
Questions Presented in the Petition......... 10

CONCLUSION..........-.. sonsivinied deaaddgaknlqoe nee 12

i]

TABLE OF AUTHORITIES

Page
CASES
14 Penn Plaza v. Pyett,__— S. Ct. __, 2009 WL
Se ahiciiatiie slot esi chit vas oxen tek cues) ambband sauna cane 7
Allied-Bruce Terminix Co’s, Inc. v. Dobson, 513
Se I aid Seisidnv avd teaniiuguninsieinnexaannec Maen auimaniens 7
AT & T Technologies, Inc. v. Communications
Workers, 475 U.S. 6438, 106 S. Ct. 1415 (1986)......... 5
Chapman v. Anchor Lumber, 823 N.E.2d 594
Caer ti BI, DET aos salen aninnecnantcedaccsundactcececeeuns 12
Doctor’s Associates, Inc. v. Casarotto, 517 U.S.
RN coi spate vnegealnecsevianedneeentiondnenessusneds 2,7,8
First Options of Chicago, Inc. v. Kaplan, 514
U.S. 938, 115 S. Ct. 1920 (1995).....................- eres
Granfinanctera, S.A. v. Nordberg, 492 U.S. 33,
109 S. Ct. 2782, 106 L.Ed.2d 26 (1989)...........0..0.0... 7
Green Tree Fin. Corp. v. Bazzle, 5389 U.S. 444
Es saint miacdcchamd corel ananaiateaaeaienrtedeiees eae
Green Tree Fin. Corp.-Alabama v. Randolph,
es Se Fe orice ash aces a loncaccasgnes tapas naaateancnied 8
Kinkel v. Cingular Wireless LLC, 223 Ill. 2d 1
PR cn ee aa are eae tig eet eee stare oa aael dares Cone cave canes 8
Kleinwort Benson North America, Ine. v.
Quantum Financial Services, Inc., 181 Ill. 2d
Be OR siesta csatokscsacasolshesineiseavaanitgescarerescdnaiersy: ee

Mastrobuono v. Shearson Lehman Hutton. Inc..
514 U.S. 52 (1995)............ 5

1V

TABLE OF AUTHORITIES — Continued

Page

Mitsubishi Motors Corp. v. Soler Chrysler-

Plymouth, Inc., 473 U.S. 614 (1985)...............0.-2.0008 4
O’Hara v. Ahlgren, Blumfeld and Kempster,

ee Ses Te ee Dawn ictienesessonicdioncessevexes ee iteaes 7
Perry v. Thomas, 482 U.S. 483, 107 S. Ct. 2520

2 ARRAS SP OPO DAE MN I NPC OTTERS 2, 8, 9
Scherk v. Alberto-Culver Co., 417 U.S. 506

SE sites tel cecke dns Jeewewincisaets ee Ecia enaearnienri deinen 9
Volt Info. Sciences, Inc. v. Bd. of Trustees of

Leland Stanford Junior Univ., 489 U.S. 468

FRE APS AHN. Ae Ree TES mane aT Pea eee D
Washington v. Confederated Bands and Tribes

of Yakima Nation, 489 U.S. 463, 99 S. Ct.

740, 58 L.Ed.2d 740 (1979).............. a Rae A ne 7
STATUTES
Federal Arbitration Act (“FAA”), 9 U.S.C. §1

MRIS accent te ena eee ea Cue aes Pas ak un mintien dale passim
Illinois Nursing Home Care Act (“INHCA”),

210 Ill. Comp. Stat. 45/1-101 et seq. ..................... 2, 4
linois Wrongful Death Act (““IWDA”), 740 III.

Comp. Stat. 180/101 ef Aah EMOTE, et
RULES

I SUN NI TIF ercvcdiicnciscnsvecesivanmsneqerctnmvsecdeened 9

INTRODUCTION

Petitioner seeks review of a decision of an
intermediate state appellate court on whether unu-
sual state statutory provisions applicable only to
nursing home residents are preempted by the Federal
Arbitration Act (FAA). Petitioner concedes that only
two other states have comparable statutes and that
no federal appellate court or state court of last resort
has ruled on whether such statutes are preempted. In
the absence of a conflict or of any indication that such
statutes are common or that the issue presented is a
frequently recurring one, Petitioner has failed to
demonstrate that this case presents an issue of suffi-
cient importance to merit this Court’s review.

Moreover, Petitioner overlooks that regardless of
how this Court might resolve the preemption
question it seeks to present, it will still have to
litigate with Respondent in court, because Respon-
dent never entered into an arbitration agreement
with Petitioner, and her lawsuit raises a claim under
the Illinois Wrongful Death Act that belongs
exclusively to her rather than to the Decedent who
signed the arbitration agreements at issue. The lower
court did not have to reach this issue because it held
the arbitration agreements invalid, but if the case
were remanded, it would have to address this issue
and could not direct Respondent’s wrongful death
claim to arbitration. Thus, Petitioner’s preemption
argument will not keep it out of court no matter how
it is resolved, and this Court should not devote its

attention to an issue that, ultimately, will have so
little impact on the course of the proceedings below.

Finally, in resolving the preemption issue posed
by Petitioner, the lower court conscientiously applied
the relevant decisions of this Court, including
Doctor’s Assoctates, Inc. v. Casarotto, 517 U.S. 681
(1996) and Perry v. Thomas, 482 U.S. 483, 107 S. Ct.
2520 (1987) and correctly recognized that those
decisions hold that the FAA permits application to
arbitration of generally applicable state-law contract
principles but preempts application of state-law prin-
ciples that apply distinctively to arbitration agree-
ments. Petitioner does not take issue with the lower
court’s statement of the principles derived from this
Court’s decisions, but only with their application to
an unusual set of state statutes. Even if Petitioner’s
complaints about the lower court’s application of FAA
preemption principles were correct, error correction —
especially with respect to a decision that does not
necessarily reflect the final word of the I]}linois courts
with respect to the issue presented — is not a suffi-
cient basis for invocation of this Court’s discretionary
jurisdiction.

STATEMENT OF THE CASE

This case involves claims that Respondent Sue
Carter brought pursuant to the Tllinois Nursing
Home Care Act ({NHCA) and the Illinois Wrongful
Death Act (IWDA) to recover damages resulting from

3

injuries sustained by and the death of Joyce Gott.
Respondent alleged that the Petitioner failed to
provide adequate care to Joyce Gott while Ms. Gott
was a resident at Petitiorer’s nursing home. Joyce
Gott was admitted into Udin Health Care Nursing
Home on January 12, 2006 to convalesce from a sur-
gical procedure that fixed a hip fracture. At the time
of admission, Ms. Gott was on Coumadin, a blood
thinner. As a result, Dr. Aziz Rahman, Ms. Gott’s
family doctor, provided a “Doctor’s Protocol” sheet
with her admission, that required the staff at Odin to
test her PTINR levels daily for the first three days,
then once a week for the three weeks after that, and
then once every two weeks for three weeks following
that. The purpose of the testing was to check the
coagulation of the blood. Contrary to the specific
instructions on the “Doctor’s Protocol,” Ms. Gott’s
PTINR was taken on January 13, 2006, and not taken
again. Because Odin failed to test Ms. Gott’s blood
according to the protocol, they failed to detect that
Ms. Gott’s blood had become too thin. As a result, Ms.
Gott, 75 years-old at the time, developed gastro-
intestinal bieeding and died on January 31, 2006.

Odin moved the trial court to compel arbitration
based on two written arbitration agreements signed
by or on behalf of Ms. Gott. In response to the motion,
Carter raised several state-law defenses, including
lack of mutuality, voidness for illegality, and that
Carter is a non-party not bound by the agreements.
The trial court denied the motion to compel arbitra-
tion and the Illinois Appellate Court, Fifth District,

4

affirmed. The Illinois Supreme Court denied Odin’s
petition for leave to appeal.

¢

REASONS FOR DENYING THE WRIT

Contrary to petitioner Odin’s assertion, review by
this Court is not necessary to ensure proper and
uniform application of the Federal Arbitration Act
(“FAA”), 9 U.S.C. § 1 et seqg., to determine if a claim is
subject to arbitration, nor does the decision below
present an irreconcilable conflict with this Court’s
precedents. Rather, this matter involves traditional
principles of contract interpretation and, under the
FAA, arbitration agreements are subject to generally
applicable state law contract defenses. Moreover,
regardless of any decision this Court might render
with respect to the question presented by Odin, the
outcome with respect to Carter’s wrongful death
claim would remain the same, because Carter was
not a party to any arbitration agreement. That is,
regardless of how this Court might resolve the pre-
emption question petitioner seeks to present, it will
still have to litigate with Respondent in court. This is
so because the FAA “does not require parties to
arbitrate when they have not agreed to do so.”
Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth,
Inc., 473 U.S. 614, 625 (1985).

I. There Is No Valid Agreement to Arbitrate
Respondent’s Wrongful Death Claim.

A. The FAA Does Not Require Courts to
Force Arbitration on Parties Who
Have Not Agreed to Arbitrate.

The FAA places arbitration agreements on equal
footing with other contracts. Contracts do not become
super contracts simply because of the presence of an
arbitration clause.

Nothing in the FAA overrides normal rules of
contract formation; the Act’s goal was to put
arbitration on a par with other contracts and
eliminate any vestige of old rules disfavoring arbitra-
tion. Arbitration depends on agreement, see First
Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943,
115 S. Ct. 1920 (1995); AT & T Technologies, Inc. v.
Communications Workers, 475 U.S. 643, 648-49, 106
S.Ct. 1415 (1986), and this Court has repeatedly
stated that “when deciding whether the parties
agreed to arbitrate a certain matter ... courts
generally should apply ordinary state-law principles
that govern the formation of contracts.” First Options,
514 U.S. at 944; see also Mastrobuono v. Shearson
Lehman Hutton, Inc., 514 U.S. 52, 60-63 (1995): Volt
Info. Sciences, Inc. v. Bd. of Trustees of Leland
Stanford Junior Univ., 489 U.S. 468, 474 (1989) (“the
interpretation of private contracts is ordinarily a
question of state law, which this Court does not sit to
review”); Green Tree Fin. Corp. v. Bazzle, 539 US.
444, 447 (2003) (the contractual interpretation
question of whether an arbitration clause permitted

6

class actions in arbitration was “a matter of state
law....”)

It is axiomatic that a party to a contract cannot
bargain away a right he or she does not have. Indeed,
petitioner Odin does not dispute the fact that the
right to bring a wrongful death claim does not belong
to the decedent. Nor is there any contention that
respondent Carter ever entered into any agreement to
arbitrate any claim. Thus, there is no denying in this
case that Carter’s wrongful death claim is not subject
to the arbitration agreement, and Odin does not
contend otherwise. Regardless of the resolution of the
preemption issues raised by the petition, therefore,
Carter’s wrongful death claim cannot be referred to
arbitration, and the case against the nursing home
will inevitably proceed in the trial court on the
wrongful-death claim.

Because the court below could have reached the
same outcome by denying arbitration on this ground
~ and would be required to address the issue and
reach the same result even if the Court were to decide
the preemption issue adversely and remand — this
Court should deny the petition for certiorari on this
independent basis. '

‘This Court recently reiterated that:

“Without cross-petitioning for certiorari, a prevailing

party may, of course, ‘defend its judgment on any

ground properly raised below whether or not that

ground was relied upon, rejected, or even considered
(Continued on following page)

B. The Illinois Court of Appeals, Fifth
District, Applied Established and Rou-
tine Principles of State Contract Law.

In Allied-Bruce Terminix Co’s, Inc. v. Dobson, 513
U.S. 265, 281 (1995), this Court reiterated that
“States may regulate contracts, including arbitration
clauses, under general contract law principles and
they may invalidate an arbitration clause ‘upon such
grounds as exist at law or in equity for the revocation
of any contract.’” (emphasis added). The court below
applied this principle in rejecting Odin’s preemption
claim. First, the court made the unremarkable obser-
vation that “a violation of public policy can be a
legitimate generally applicable defense to all con-
tracts in [llinois.” Pet. App. 6a (citing O’Hara v.
Ahlgren, Blumfeld and Kempster, 127 fll. 2d 333, 314-
42 (1989); Kleinwort Benson North America, Inc. v.
Quantum Financial Services, Inc., 181 Ill. 2d 214,
226-27 (1998).

Next, the Illinois Court of Appeals observed ‘hat,
unlike the statute at issue in Doctor’s Associates, Inc.
v. Casarotto, 517 U.S. 681], 687 (1996), the [linois
Nursing Home Care Act (INHCA) (210 Ill. Comp.

by the District Court or the Court of Appeals.”
Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 38-39,
109 S.Ct. 2782, 106 I.Ed.2d 26 (1989) (quoting
Washington v. Confederated Bands and Tribes of
Yakima Nation, 439 U.S. 463, 476, n. 20,99 S. Ct. 740,
58 L.Ed.2d 740 (1979))

14 Penn Plaza v. Pyett,__ S. Ct. ___, 2009 WL 838159 at *15

8

Stat. 45/3-606 and 3-607, “represent[s] ‘emphatically
stated public policy’ that has existed in this state for
nearly 30 years.” Pet. App. 7a. The Illinois Appellate
Court correctly stated that:

The rule stated in Casarotto and [Perry v.|
Thomas|, 482 U.S. 483 (1987),] fis] that state
law is applicable and is not preempted by the
Federal Arbitration Act if that law arose to
govern issues concerning the validity, rev-
ocability, and enforceability of contracts
generally.

Pet. App. 9a. The Illinois Appellate Court then
applied the rule as stated in Casarotto and Thomas to
the facts of this case and concluded that:

because the public policy expressed in
sections 3-606 and 3-607 concerns the
validity, revocability and enforceability of
contracts generally and does not specifically
target arbitration agreements, it presents a
legitimate state law contract defense of a
violation of public policy to the agreements
and so voids the agreements.

Pet. App. 10a (citing Kinkel v. Cingular Wireless LLC,
223 Ill. 2d 1, 15-19 ‘2009)). The reasoning of the
Illinois Appellate Court is consistent with this Court’s
express holding in Casarotto that “[cjourts may not

invalidate arbitration agreements under state
laws applicable only to arbitration provisions.” 517
U.S. at 686. Thus, despite the “lberal federal policy
favoring arbitration agreements,” Green Tree Fn.

Corp.-Alabama v. Randolph, 531 U.S. 79, 81 (2000),

9

state law is not entirely displaced from the FAA
preemption analysis. Under § 2, “state law, whether
of legislative or judicial origin, is applicable if that
law arose to govern issues concerning the validity,
revocability, and enforceability of contracts generally.”
Thomas, 482 U.S. at 492 n. 9 (1987). In other words,
in enacting the FAA “Congress [only] precluded
States from singling out arbitration provisions for
suspect status, requiring instead that such provisions
be placed ‘upon the same footing as other contracts.’”
Id. (queting Scherk v. Alberto-Culver Co., 417 US.
506, 511 (1974)). In short, the Illinois Appellate
Court’s ruling is consistent with this Court’s prece-
dents.

Tt is also well established that state law governs
the enforceability of contracts, so long as the state
law does not disfavor arbitration clauses as compared
to other contract terms. Here, Odin has not shown,
and cannot show, a conflict or a “state of confusion”
about either these broad principles or their applica-
tion to this case. Indeed, Odin’s claim is, at most, that
the court below misapplied correctly stated legal
principles to the particular [llinois statutes involved
in this case. Even if Odin was correct, such a claimed
error by an intermediate-level state appellate court
hardly warrants review by this Court. Indeed, this
Court’s Rule 10 specifically admonishes that “la!
petition for certiorar! is rarely granted when the
asserted error consists of ... the misapplication of a

properly stated rule of law.”

10

Il. There Is No Split in Authority on the
Questions Presented in the Petition.

In an effort to dress up its request for review of
the correctness of the lower court’s decision as an
issue meriting this Court’s attention, petitioner Odin
claims that the decision conflicts with a number of
decisions of federal appellate courts. An examination
of the decisions Odin cites, however, reveals that the
conflict is chimerical. The federal appellate cases
Odin cites involve the very different question whether
statutes that forbid the enforcement of forum selec-
tion clauses in franchise or construction contracts are
preempted by the FAA when applied to arbitration
agreements including such clauses. [Pet. 26-27] That
may be an interesting and even important question,
but cases resolving it hardly present a square conflict
with a decision about the enforceability of an
arbitration agreement involving a nursing home
resident.

Turning to the issue actually directly involved in
the case, Odin concedes that it has been able to locate
only two other states that have statutes that are
directly comparable to the Illinois laws at issue here
— a concession that significantly undermines any
suggestion that the issue presented here is of broad,
national importance. And as to whether such statutes
are preempted by the FAA, Odin cites only two
unreported and unappealed federal trial-court rulings
that touched on the preemption question [Pet. 26-27],
neither of which involved a direct attempt to enforce

an arbitration provision in a contract signed by a

11

nursing home resident. In other words, the issue pre-
sented has yet to reach either a state court of last
resort or a federal appellate court, in this or any other
case. If and when the issue is resolved at that level,
its resolution presents a conflict, there will be ample
time for the Court to address that issue.

In a final attempt to suggest the existence of a
conflict of state supreme court authority, Odin cites
rulings of the Oklahoma, Alabama, Mississippi, and
Texas Supreme Courts on a different issue — whether
contracts between nursing homes and their residents
involve interstate commerce sufficiently to trigger
application of the FAA. [Pet. 27-28] The decision
below, however, did not even suggest that the FAA
was inapplicable for that reason, and, indeed,
assumed its applicability. Odin’s claim that the Okla-
homa state court’s resolution of the interstate com-
merce issue indicates that they are “hostile” to the
FAA might conceivably offer some reason for review of
an Oklahoma decision based on the commerce
rationale, but it 1s hardly a reason for reviewing an
Illinois decision that did not even address that issue.
In other words, even if there is a split among the
state supreme courts as to whether contracts between
nursing homes and their residents involve interstate
commerce, this case simply does not present that

question and such a split cannot be a basis for review.

In the end, this case involves only the views of
one intermediate state appellate court on preemption
of an unusual state statute. Based on QOdin’s own
canvass of the judicial landscape, it is evidently the

12

first appellate court in the country to address pre-
emption of such a statute. And its holding is not even
definitive within its own state: the Illinois courts of
appeals for other districts may conceivably resolve
the issue differently, as may the Illinois Supreme
Court, should a conflict among the lower state courts
arise that requires resolution at a higher level.
Chapman v. Anchor Lumber, 823 N.E.2d 594, 596 (3d
Dist. Ill. App. 2005) (noting that Illinois has five
appellate districts, aad the decisions of one district
are not binding on the others). Only at that point will
the view of the Illinois courts be finally settled, and
only if that view comes into conflict with decisions of
other state courts of last resort or federal courts of
appeals might an issue requiring resolution by this
Court be presented.

CONCLUSION

For the foregoing reasons, the petition for a writ
of certiorari should be denied.

Respectfully submitted,

STacit M. YANDLE K. GLENDA CAMERON
7012 West Main St. Counsel of Record
Belleville, IL 62223 2006 Eastern Suburb,
(618) 394-9600 Suite 101

Christiansted. VI 00820
(340) 773-3444
Attorney = for Respondent

Date: April 30, 2009

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386020_0929%3A2. Public record. Not legal advice.