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Statements made to keep a sold trip going come back to haunt defendant after whitewater rafting death.

Never forget, Marketing makes promises risk management has to pay for. Statement made about the water level dropping by the time a certain rapid was to be reached at issue in litigation but allows the plaintiff to add claims for punitive damages.

The Estate of Joseph R. Kane, v. Epley’s Inc., 2017 U.S. Dist. LEXIS 48179

State: Idaho, United States District Court for the District of Idaho

Plaintiff: The Estate of Joseph R. Kane, deceased; Stacie Kane, individually, and as guardian of Joseph P. Kane; and Thomas Kane, individually,

Defendant: Epley’s Inc.

Plaintiff Claims: Motion to add punitive damages to the complaint

Defendant Defenses: Evidence does not support the motion

Holding: Plaintiff’s motions were granted

Year: 2017

This case concerns statements made prior to a Whitewater rafting trip in Idaho on the Lower Salmon River. A group of Boy Scouts and their adult volunteers booked this trip with the defendant. The majority of the Boy Scouts on the trip did not have any Whitewater experience.

The deceased was ejected from the raft in this section of the lower Salmon River known the slide wrap. Idaho has an outfitters and guide’s statute that says an outfitter is liable if they breach the standard of care for their industry.

Through this action, Plaintiffs (to include the estate of Mr. Kane, his wife Stacie Kane, and sons Thomas and Joseph P. Kane) claim that Epley’s conduct — in particular, its decision to run the Slide Rapid at flows above 23,000 cubic feet per second (“cfs”) — breached the standard of care applicable to outfitters and guides under chapter 12, Title 6, Idaho Code and that said breach was a direct and proximate result of Mr. Kane’s death.

The issue for the plaintiffs when they arrived at the defendant’s office was the volume of water flowing on the river. It is slightly confusing, but it seems the Bureau of Land Management or the outfitting association on the river had set a cutoff of 23,000 CFS as the maximum level, the river could be rafted. There was discussion at the time Boy Scouts arrived as to what the actual river flow was and what the flow would be in a few days when the group reached the big rapid.

The plaintiffs argued to the appellate court that the defendant intentionally misrepresented the flow of the river and whether not the flow would go up or down. This misrepresentation made by the defendant was the basis for the plaintiff’s motion to amend their complaint and add a claim requesting punitive damages.

According to Plaintiffs, Epley’s not only ignored and misrepresented to the group the extreme risks presented by the water levels forecasted to be encountered at Slide Rapid on June 27, 2014 (thus permitting the trip’s June 24, 2014 launch in the first instance), its later decision to actually continue through Slide Rapid on June 27, 2014 at flows in excess of 23,500 cfs represented an extreme deviation from industry standards.

The arguments made by the plaintiffs are that the manager for the defendant misled them on the river volume and what the volume of the river would be on the date when the group encountered slide wrap. The plaintiffs also argued that the defendants had an opportunity to avoid slide rapid by taking out or going on a different trip.

As of this date, this case has not gone to trial. This is only a preliminary motion’s hearing. What it takes to prove the plaintiff’s case at trial may be totally different than what the facts in this decision are. There is also higher likelihood that the case will settle now.

Analysis: making sense of the law based on these facts.

The court first looked into the requirements under Idaho statutes add a claim for punitive damages and what punitive damages were in Idaho.

In any action seeking recovery of punitive damages, the claimant must prove, by clear and convincing evidence, oppressive, fraudulent, malicious or outrageous conduct by the party against whom the claim for punitive damages is asserted.

To prove a claim and receive punitive damages in Idaho the plaintiff must prove by clear and convincing evidence that the defendant made fraudulent misstatement or engaged in outrages conduct. There is a high standard of proof to build a case to recover punitive damages.

That definition includes a defendant acting in such a way that is extreme deviated from the reasonable standard of care or acted maliciously fraudulently or outrageously.

Ultimately, an award of punitive damages requires a bad act and a bad state of mind. The defendant must (1) act in a manner that was an extreme deviation from reasonable standards of conduct with an understanding of — or disregard for — the likely consequences, and must (2) act with an extremely harmful state of mind, described variously as with malice, oppression, fraud, or outrageousness.

However, that requirement of proof set out above does not need to be met to allege punitive damages in the complaint. To add a claim for punitive damages in the complaint, plaintiff needs only prove a reasonable likelihood of proving facts at trial to support a claim.

However, for purposes of a motion to amend, the party seeking to add a claim for punitive damages does not need to meet this high burden; rather, the party need only show “a reasonable likelihood of proving facts at trial sufficient to support an award of punitive damages.”

These requirements are balanced by the theory that under Idaho law, punitive damages were not favored and should only be awarded in most unusual compelling circumstances.

As a matter of substantive law, it is well established in Idaho that punitive damages are not favored and should be awarded only in the most unusual and compelling circumstances, and are to be awarded cautiously and within narrow limits.

The plaintiff’s argument centered on the river flows on the dates of the trip. The defendant argued that by the time the party reached the slide rapid the water levels would have decreased. The plaintiff argued that the opposite occurred, that the water levels had increased. The Plaintiff also argued that the guides could have called or should have called for more help.

Still, Defendant decided to proceed through Slide Rapid with allegedly unqualified guides, foregoing options to use an available satellite phone to discuss potentially safer options for the relatively inexperienced group, portage around Slide Rapid, or altogether exit the river on land at Eagle Creek (the last place where the group could have readily done so).

The court found the plaintiff had produced enough evidence to prove there was a likelihood that they could prevail on their punitive damages claim at trial.

Viewing the evidence in the light most favorable to Plaintiffs, and giving Plaintiff the benefit of all legitimate inferences without assessing credibility, Plaintiffs have established a reasonable likelihood of proving by clear and convincing evidence that Defendant acted in a manner that was an extreme deviation from reasonable standards of conduct with an understanding (as an experienced outfitter) of — or disregard for — the likely consequences of those actions.

The court then looked at the plaintiff’s claim that the defendant acted with the bad state of mind court or an extremely harmful state of mind. They argued that the manager of the defendant’s river operation purposely misled them about the river levels.

In other words, Plaintiffs argue that Mr. Blackner purposely misled Ms. Schaefer and, thus, the group by failing to inform them of actual (as of the June 24, 2014 launch date) and projected (for the anticipated encounter with Slide Rapid on June 27, 2014) river flows — that is, it was fraudulent and outrageous for Mr. Blackner to say that the forecasted flow for Slide Rapid on June 27, 2014 was 17,000 cfs, when, in actuality, it was much higher.

Again, even though the defendant disputed the allegations. There was enough evidence in addition to the witness statements to support the claim. In fact, the court found that there was more enough evidence to support the claim and that the defendant had acted with the bad state of mind.

In other words, Plaintiffs argue that Mr. Blackner purposely misled Ms. Schaefer and, thus, the group by failing to inform them of actual (as of the June 24, 2014 launch date) and projected (for the anticipated encounter with Slide Rapid on June 27, 2014) river flows — that is, it was fraudulent and outrageous for Mr. Blackner to say that the forecasted flow for Slide Rapid on June 27, 2014 was 17,000 cfs, when, in actuality, it was much higher.

Consequently, the plaintiff’s motion to amend the complaint and add a claim for punitive damages was upheld by the court.

So Now What?

Honestly, it is hard to believe that the river outfitter intentionally misled the plaintiffs in this case. I do suspect that the river outfitter was making statements an attempt to hold onto the trip without either checking the facts or understanding what was really going on with river flows.

Water levels are a constant source of discussion between River outfitters. You want the water levels high enough to attract clients and low enough not to hurt anyone. The best River outfitters figure out, which claims to market to which groups for river levels they are expecting.

Things always change when a fatality occurs. Whatever the trip leader says about what is going to be expected will be adopted by the clients. So if river guides say the rivers okay, clients know the river is okay.

Never forget, marketing makes promises that risk management has to pay for. Here, in an attempt to hold onto a group of clients for a multi-day whitewater rafting trip, marketing might’ve taken over when risk management might’ve been the road.

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Author: Outdoor Recreation Insurance, Risk Management and Law

Copyright 2017 Recreation Law (720) Edit Law

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By Recreation Law           Rec-law@recreation-law.com     James H. Moss

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