44 Trial Lawyer • Spring 2022 discrimination statutes. The U.S. Supreme Court held the baker’s religious objection had not been considered with the neutrality that the Free Exercise Clause requires. The U.S. Supreme Court granted the Kleins’ petition, vacated the Court of Appeals’ decision and remanded the case for reconsideration in light of Masterpiece Cakeshop. On remand from the U.S. Supreme Court, the Court of Appeals adhered to its earlier decision upholding BOLI’s determination Aaron Klein unlawfully discriminated against the BowmanCryers by refusing to bake them a wedding cake because of their sexual orientation, and neither the state nor the federal constitution precludes the enforcement of the statute against him. The Court of Appeals held that, under Employment Div., Dept. of Human Resources of Oregon v. Smith, 494 US 872, 110 S Ct 1595, 108 L Ed 2d 876 (1990), the Free Exercise Clause does not preclude the enforcement of a generally applicable and neutral law, even where a person’s failure to comply with that law stems from the person’s adherence to faith obligations. Article I, sections 2 and 3, of the Oregon Constitution, likewise do not require that a person be granted an exception from a generally applicable, religiously neutral law when the law burdens the person’s exercise of their religious beliefs. With respect to BOLI’s noneconomic damages award, the Court of Appeals reached a different conclusion, construing the U.S. Supreme Court’s decision in Masterpiece Cakeshop to set forth three principles for review. First, in evaluating on direct review a litigant’s claim that an adjudication is premised, in whole or in part, on unconstitutional hostility toward religious beliefs, a reviewing court must examine the entire record at each stage of the case. Second, where a governmental adjudicator is called upon to determine whether a person’s conduct violates a generally applicable and neutral law, and that conduct was motivated by a religious belief, the adjudicator must act scrupulously to ensure the adjudication targets only the unlawful conduct and is not in any way the product of the adjudicator’s hostility toward the belief itself. Third, even “subtle departures” from neutrality violate the First Amendment and require corrective action from a reviewing court. Applying those principles, the Court of Appeals concluded, under Masterpiece Cakeshop, the damages portion of the proceedings before BOLI did not comport with the First Amendment’s requirement of strict neutrality toward religion. The Court of Appeals concluded BOLI at least subtly departed from the requirement of strict neutrality by expressly awarding damages in part based on what it found as fact to be Aaron Klein’s expression of his views in the context of a religious dialogue. The statute of ultimate repose in ORS 12.115 does not apply to claims alleging negligently caused economic loss. Marshall v. PricewaterhouseCoopers, LLP, 316 Or App 416 (2021); Shorr, J. The plaintiffs were represented by Jeff Pitzer and John Dunbar. The plaintiffs considered whether to sell their shares in a corporation to a third party as part of an effort to minimize taxes; under the deal, the third party would assume all of the corporation’s assets and liabilities, including its tax liabilities. The plaintiffs hired the defendant law firm (Schwabe) to advise them whether the transaction was legitimate or a tax avoidance scam that would expose them to tax liability. Schwabe allegedly failed to advise the plaintiffs that the deal was likely a scam and that, if the third party did not pay the corporation’s taxes, the plaintiffs could be held liable for any unpaid tax liability. Ultimately the IRS held the plaintiffs liable for the taxes. The plaintiffs sued Schwabe for malpractice, seeking damages for the tax liability and attorney fees paid to Schwabe and others. The trial court granted Schwabe’s motion to dismiss based on the statute of ultimate repose in ORS 12.115. The Court of Appeals reversed, holding that ORS 12.115 did not apply because the plaintiffs’ claim was for economic loss, not “injury to person or property” (which is what the statute provides). The court cited prior decisions interpreting similar language in other statutes and holding that those statutes do not apply to economic losses such as indebtedness incurred and return of monies paid. The court also noted that it had held ORS 12.115 to apply in two legal malpractice actions stemming from divorce cases but explained that those cases both had involved injuries to property, or at least injuries to an interest in property, specifically, the unintended distribution of property following a divorce and a probate. The court recognized that some past cases had used broad language to describe the scope of ORS 12.115 (e.g., “negligence” or “tort” claims), and that the Legislature may have intended to protect lawyers in all negligence actions, but the court held that the statutory text was controlling and that none of the prior cases had actually applied the statute when no injury to person or property was implicated and the action sought to recover for economic loss alone. Finally, the court noted that attorneys, their clients and insurers may have their expectations unsettled by this ruling, but held that policy considerations could not trump Oregon’s paradigm for interpreting statutes Creditors of an LLC can obtain garnishment from the LLC’s members for amounts they owe to the LLC, such as for unlawful distributions and fraudulent transfers. Twigg v. Opsahl, 316 Or App 775 (2022); Kamins, J. The plaintiffs were represented by Steven Cade. Sheets Continued from p 43
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