McDONALD'S CORP. v. Ogborn
| Decision Date | 25 January 2010 |
| Docket Number | No. 2008-CA-000024-MR.,2008-CA-000024-MR. |
| Citation | 309 SW 3d 274 |
| Parties | McDONALD'S CORPORATION, Appellant, v. Louise OGBORN, Donna J. Summers, and Kim Dockery, Appellees. |
| Court | Kentucky Court of Appeals |
Steven T. Catlett (argued), Chicago, IL, Margaret E. Keane and James W. Herr (argued), Louisville, KY, for appellant.
Ann Oldfather (argued), Kirsten R. Daniel, Vicki L. Buba, Louisville, KY, for appellee, Louise Ogborn.
Glenn Cohen (argued), Paul J. Hershberg, Cynthia L. Effinger, Louisville, KY, for appellee, Donna J. Summers.
Frank Hampton Moore, Jr., Matthew P. Cook, Bowling Green, KY, for appellee, Kim Dockery.
Before ACREE, TAYLOR and THOMPSON, Judges.
The defendant below, McDonald's Corporation, appeals the November 15, 2007, judgment of the Bullitt Circuit Court awarding both compensatory and punitive damages to Louise Ogborn, the plaintiff below, and Donna J. Summers, a defendant and cross-claimant below. We affirm the judgment of the Bullitt Circuit Court except as to the punitive damages awarded to Summers, which we reduce to comport with constitutional due process.1
Between 1994 and 2004, an unknown individual placed a series of hoax telephone calls to McDonald's and other fast food restaurants, pretending to be a police officer. During that time, he convinced restaurant managers, employees, and third parties to conduct strip searches and even sexual assaults at his direction.2 The caller was successful in accomplishing his perverse hoax more than thirty times at different McDonald's restaurants alone, including several in Kentucky.3
McDonald's corporate legal department was fully aware of these hoaxes and had documented them. The evidence supports the reasonable conclusion that McDonald's corporate management made a conscious decision not to train or warn store managers or employees about the calls. The evidence further supports the finding that proper training or warning would have prevented successful repetition of the hoaxes.
On April 9, 2004, eighteen-year-old Louise Ogborn had just finished her afternoon shift as an employee at the Mt. Washington, Kentucky, McDonald's restaurant when a manager asked her to work a second shift to fill in for an absent employee. She agreed to do so after she finished a meal the restaurant provided to its employees under such circumstances.
Shortly thereafter, an unknown individual telephoned the restaurant and assistant manager Donna Summers answered. The caller falsely identified himself as a police officer and claimed to be investigating a recent theft of a purse or wallet at the restaurant. According to the caller, the perpetrator was a McDonald's employee. He described a female suspect which Summers believed fit Ogborn. Ogborn was summoned to the office and informed that she was the subject of an "investigation" into this theft. The series of events that unfolded thereafter lasted more than three hours.
At the instruction of the caller, Summers told Ogborn she had two choices: she could be searched in the office by her managers or at the police station after arrest. After speaking with the caller, Ogborn agreed to be searched in the office. In accordance with the caller's detailed instructions, Ogborn was methodically searched as she was convinced to gradually disrobe. Summers took Ogborn's clothes, cell phone and other belongings, and removed them from the office. The assistant manager who was to replace Summers for the evening shift, Kim Dockery, soon arrived and provided Ogborn with an apron to cover her, but then returned to management duties outside the office.
The caller then instructed Summers to summon a male employee to sit with Ogborn during the investigation. Following instructions, Summers left the office and returned with a cook, Jason Bradley. Bradley spoke to the caller and after several minutes left the office, informing Summers, in appropriately strong, colloquial language, that the situation was unacceptable. However, he took no further action and returned to his work.
Undaunted, the caller asked Summers if she was married. She responded that although she was unmarried, she was engaged. The caller then instructed Summers to have her fiance, Walter Nix,4 come to the office and stay with Ogborn. Summers called Nix, who soon arrived.
Without questioning the propriety of doing so, Summers left Nix largely alone in the office with Ogborn, who was still naked but for the apron she held in front of herself. Summers and Dockery periodically, but only briefly, returned to the manager's office. Nix, acting on the instruction and encouragement of the caller, forced Ogborn to perform a series of humiliating physical acts, conducted a cavity search of her body, engaged in the additional physical assault of spanking her, and ultimately sexually assaulted her. After nearly two hours, Nix left the restaurant and Summers resumed control of the situation. Summers was not aware until later that her fiance had physically and sexually assaulted her employee.
While Ogborn was detained naked in the office and subjected to these searches and assaults, she continuously expressed her strenuous objection to the search, asked for her clothes, and requested permission to leave. Her requests evoked some sympathy from her managers but were ultimately denied.
Summers then brought into the office a McDonald's maintenance employee, Tom Simms, to take the phone, speak with the caller, and sit with Ogborn. After a while, Simms and several other employees appropriately assessed the call and the caller as a fraud. The hoax having been revealed, the call was terminated. Summers' supervisor, Lisa Siddons, was called. When Siddons arrived, she called the police.
McDonald's terminated Summers' employment. Nix was found guilty and imprisoned on three felony indictments. Summers entered an Alford plea5 to a misdemeanor charge. David Stewart, a Florida security guard with no affiliation to McDonald's, was suspected as the hoax caller and was charged with felonies related to the incident at the Mt. Washington McDonald's restaurant; Stewart was eventually acquitted.
Both Ogborn and Summers underwent counseling. The psychological impact on Ogborn manifested in significant physical and behavioral changes.
Ogborn filed suit against McDonald's, Summers, and Dockery. McDonald's responded with a third-party complaint for indemnity against Nix. Summers also filed a cross-complaint against McDonald's. Seeking to impose liability on the caller, McDonald's filed a third-party complaint against David Stewart. However, after Stewart was acquitted in his criminal trial, allegations focused on an "unknown" caller. Significantly, McDonald's did not pursue a third-party claim against the unknown caller.6
A lengthy period of discovery revealed substantial evidence that McDonald's corporate legal department was aware of the many similar previous incidents at its restaurants but chose not to train or warn restaurant employees so as to prevent future incidents. This evidence was presented to the jury.
At the close of the evidence, the jury found for Ogborn and against McDonald's on Ogborn's claims of sexual harassment, false imprisonment, premises liability, and negligence. The jury awarded Ogborn $1,111,312.00 in compensatory damages and $5,000,000.00 in punitive damages.
The jury also found against McDonald's on Summers' claim for Intentional Infliction of Emotional Distress (IIED), awarding her $100,000.00 in compensatory damages and $1,000,000.00 in punitive damages.
On Summers' claims and Ogborn's claims the jury apportioned damages 50 percent to McDonald's and 50 percent to the unknown caller who was a non-settling non-party. No apportionment instruction was submitted to the jury or requested for Stewart. The circuit court entered a judgment imposing all damages awards against McDonald's without apportionment. This appeal followed.
McDonald's arguments fall into three categories: (1) those pertaining only to Ogborn; (2) those pertaining only to Summers; and (3) those pertaining to both Ogborn and Summers. We address the arguments in those categories.
Regarding Ogborn's judgment, McDonald's appeals on the following grounds:
A. The Kentucky Worker's Compensation Act provides Ogborn's "sole remedy" and the trial court "had no jurisdiction to hear Ogborn's claims";
B. The Kentucky Civil Rights Act preempts Ogborn's claims;
C. Ogborn's Kentucky Civil Rights Act claim fails as a matter of law because McDonald's cannot be liable for a nonemployee's conduct, and the McDonald's employees were found not negligent;
D. The evidence does not support Ogborn's false imprisonment claim;
E. Ogborn's premises liability claim fails as a matter of law;
F. Ogborn's negligence claim fails as a matter of law;
G. Nix's unforeseeable criminal acts function as an intervening cause which prevents the imposition of liability to McDonald's;
H. The evidence did not support an award of punitive damages under Kentucky Revised Statutes (KRS) 411.184(3).
The merits of these arguments are not sufficient to reverse the judgment in favor of Ogborn. We consider each of these arguments in turn.
McDonald's argues, by virtue of KRS 342.690(1), that the liability of an employer under the Workers' Compensation Act is exclusive and in place of all other liability. KRS 342.610(1). We believe McDonald's waived this argument.
From the aforementioned provisions of the Workers' Compensation Act, McDonald's reasons that Ogborn's employment with McDonald's divested the trial court of jurisdiction to adjudicate Ogborn's claims. "In our view, this construction of the statute is erroneous for it confuses a defensive plea with want of jurisdiction." Gordon v. NKC Hospitals, Inc., 887...
To continue reading
Request your trial