author: /s/ G. Barry Anderson Associate Justice

text:
    Henry L. WILSON, Respondent, v. SCANLAN INTERNATIONAL, INC., and State Fund Mutual Ins. Co., Relators, and HealthPartners, Fairview Health Services, Allina Hospitals & Clinic/United Hospital, St. Paul Radiology, Neurological Associates, and University of Minnesota Physicians, Intervenors.
    No. A06-23.
    Supreme Court of Minnesota.
    March 28, 2006.
   ORDER

Based upon all the files, records, and proceedings herein,

IT IS HEREBY ORDERED that the decision of the Workers’ Compensation Court of Appeals filed December 9, 2005, be, and the same is, affirmed without opinion. See Hoff v. Kempton, 317 N.W.2d 361, 366 (Minn.1982) (summary affir-mances have no precedential value because they do not commit the court to any particular point of. view, doing no more than establishing the law of the case).

Employee is awarded $1,200 in attorney fees.

BY THE COURT:

/s/ G. Barry Anderson Associate Justice

GILDEA, J., took no part in the consideration or decision of this case.


source: Caselaw Access Project

author: /s/Alan C. Page Associate Justice

license: Public Domain

text:
    Brenda L. MUNDY, Relator, v. AMERICAN RED CROSS, and American International Group/Heritage Claims Services, Respondents, and Noran Neurological Clinic, and Minnesota Department of Human Services, Intervenors.
    No. A06-25.
    Supreme Court of Minnesota.
    March 28, 2006.
   ORDER

Based upon all the files, records and proceedings herein,

IT IS HEREBY ORDERED that the decision of the Workers’ Compensation Court of Appeals filed December 13, 2005, be, and the same is, affirmed without opinion. See Hoff v. Kempton, 317 N.W.2d 361, 366 (Minn.1982) (summary dispositions have no precedential value because they do not commit the court to any particular point of view,, doing no more than establishing the law of the case).

BY THE COURT:

/s/Alan C. Page Associate Justice


author: ANDERSON, RUSSELL A., Chief Justice.

text:
    Ronald PETERSON, et al., Respondents, v. BASF CORPORATION, a foreign corporation, Appellant.
    No. C3-02-857.
    Supreme Court of Minnesota.
    March 30, 2006.

      James A. O’Neal, John P. Borger, Winthrop A. Rockwell, Bruce Gregory Jones, John P. Mandler, Faegre & Benson LLP, Minneapolis, MN; and Kenneth F. Jo-hannson, Crookston, MN, for Appellant BASF Corp.
    Hugh V. Plunkett, III, Scottsdale, AZ; and J. Michael Schwartz, Minneapolis, MN, for Respondent Ronald Peterson.
    Douglas J. Nill, Minneapolis, MN, for Respondents Barry Thune and Christopher Grove Farms and Ronald Peterson.
    Wayne D. Struble, Bowman and Brooke, Minneapolis, MN, for Amicus The Product Liability Advisory Council, Inc.
    Lawrence S. Ebner, McKenna Long & Aldridge LLP, Washington, DC, for Ami-cus CropLife America.
    Evan M. Tager, Mayer, Brown, Rowe & Maw LLP, and Robin S. Conrad, Washington, DC, for Amicus Chamber of Commerce of the United States.
    Todd Anders Noteboom, Leonard Street & Deinard, Minneapolis, MN, for Amicus National Assoc, of Independent Insurers.
    Michael Robert Docherty, Minneapolis, MN, for Amicus Tort Reform Association and Amicus American Tort Reform Association.
    William F. Mohrman, Mohrman & Kaar-dal, P. A., Minneapolis, MN, for Amicus Washington Legal Foundation.
    Scott W. Johnson, Minneapolis, MN, for Amicus National Assoc, of Manufacturers/American Chemistry.
    Mike Hatch, Attorney General, Prentiss Edward Cox, St. Paul, MN, for Amicus Minnesota Attorney General.
    Bruce Michael Eleven, ST. Paul, MN, for Amicus American Sugarbeet Growers Association.

      J. Gordon Rudd, Jr., Zimmerman Reed PLLP, Minneapolis, MN, for Amicus Minnesota Trial Lawyers Association.
    David Ryan Moeller, Farmers Legal Action Grp. Inc., St. Paul, MN, for Amicus Minnesota Farmers Union.

      . Appointed pursuant to Minn. Const, art. VI, §§ 2, 10, and Minn.Stat. § 2.724, subds. l, 2 (2004).

   OPINION

ANDERSON, RUSSELL A., Chief Justice.

In February 2004, we affirmed the judgment for respondents Ronald Peterson, et al., in this class action against appellant BASF Corporation for violation of the New Jersey Consumer Fraud Act (“NJCFA”), N.J. Stat. Ann. §§ 56:8-1 to - 106 (West 2001), in BASF’s marketing and advertising of its herbicides Poast and Poast Plus. Peterson v. BASF Corp., 675 N.W.2d 57 (Minn.2004) (“Peterson III”). BASF petitioned the United States Supreme Court for a writ of certiorari. In an order filed May 2, 2005, the Court granted the writ of certiorari, vacated the judgment, and remanded for reconsideration in light of Bates v. Dow Agrosciences LLC, 544 U.S. 431, 125 S.Ct. 1788, 161 L.Ed.2d 687 (2005), a recently-decided case on preemption under the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”), 7 U.S.C. §§ 136-136y (2000). BASF Corp. v. Peterson, 544 U.S. 1012, 125 S.Ct. 1968, 161 L.Ed.2d 845 (Mem.) (2005). Bates confirms our earlier conclusion that the respondents’ claims are not preempted by FIFRA, and we therefore affirm the court of appeals.

The facts and procedural history of this case are explained in our initial decision, 675 N.W.2d at 61-65, and need not be recounted in detail here. BASF is a corporation that develops, produces, and markets herbicides. Respondents (“farmers”) are a nationwide class of farmers who alleged that BASF violated the NJCFA by deceptively advertising and marketing two BASF herbicides, Poast and Poast Plus. Evidence introduced at trial established that the two products, when applied according to label instructions, contain the same amount of the same active ingredient per acre. Both products were registered with the Environmental Protection Agency (“EPA”) under FIFRA for use on the same crops, including both major crops and minor crops. Nevertheless, pursuant to a marketing strategy to maximize profits based on the different economics of the major and minor crop herbicide markets, BASF did not register Poast Plus with state regulators for use on most minor crops and its label did not indicate it was suitable for use on minor crops. BASF furthered this marketing plan by use of advertising and literature, and other conduct, that BASF’s internal documents indicated were intended to prevent farmers from learning that the lower-priced Poast Plus was EPA-registered for minor crops and was the active-ingredient equivalent of Poast.

The farmers brought this class action suit against BASF under the New Jersey Consumer Fraud Act in 1997. The district court certified the class action in 1999. In 2000, the court denied BASF’s motion to decertify the class, but granted BASF’s motion for summary judgment, concluding that BASF’s actions did not violate the NJCFA. On appeal, the Minnesota Court of Appeals reversed the summary judgment, holding that there was a question of fact as to whether BASF had violated the NJCFA. Peterson v. BASF Corp., 618 N.W.2d 821, 825-26 (Minn.App.2000) (“Peterson I ”). This court denied BASF’s petition for review.

The case proceeded to trial, at the end of which the jury unanimously found by special verdict that BASF had violated the NJCFA. The jury found $15 million- in damages to the class members, which was trebled as required by the NJCFA. N.J. Stat. Ann. § 56:8-19 (West 2001). With the addition of attorney fees, available to prevailing plaintiffs under the NJCFA, id., and interest, judgment was entered for the farmers in the amount of $52,058,931.51.

BASF appealed on numerous grounds, including as relevant here federal preemption of the state-law claims, erroneous admission of prejudicial evidence, and improper denial of BASF’s requested jury instructions. The court of appeals affirmed. Peterson v. BASF Corp., 657 N.W.2d 858 (Minn.App.2003) (“Peterson II”). BASF petitioned this court for review; the petition included the preemption issue, but did not include any express reference to evidentiary or jury instruction issues. We granted review and affirmed in Peterson III.

BASF petitioned the United States Supreme Court for a writ of certiorari. The Court granted the writ, vacated the judgment, and remanded the ease to this court for reconsideration in light of a recently-decided FIFRA preemption case, Bates, 544 U.S. 431, 125 S.Ct. 1788. BASF Corp., 125 S.Ct. 1968. As Bates only involved the issue of FIFRA preemption, we review only the preemption aspect of our decision in Peterson III. See In re Linehan, 594 N.W.2d 867, 871 (Minn.1999).

BASF raises two main claims that it contends should be reviewed under Bates. First, BASF argues that under the Bates analysis the consumer fraud claims that are the foundation of this case are preempted by FIFRA, and therefore the case must be dismissed. In the alternative, BASF argues that even if the claims are not preempted as a matter of law, erroneous rulings regarding evidence and jury instructions mandate a new trial under Bates.

I.

The starting point for any preemption analysis is the statute itself, because the touchstone of preemption is Congressional intent. E.g., Malone v. White Motor Corp., 435 U.S. 497, 504, 98 S.Ct. 1185, 55 L.Ed.2d 443 (1978). We therefore begin our analysis with a brief summary of FI-FRA, which is described in more detail in our initial opinion. Peterson III, 675 N.W.2d at 61-62. FIFRA is a federal statute that regulates pesticides. FIFRA requires federal registration of pesticides with the EPA and imposes labeling requirements. 7 U.S.C. §§ 136(p), (q), (ee); 136a(a); 136j(a)(2)(G); 136w(c)(3) (2000); 40 C.F.R. § 156.10 (2005). Under FIFRA, a pesticide may only be distributed or used on a particular crop if: (1) the EPA has registered it for that crop, and (2) the farmer uses the pesticide in conformity with its label. 7 U.S.C. §§ 136(ee), 136a(a). Under FIFRA, even if the EPA registers a pesticide for a given type of crop, the producer need not include that use on the label — it may label for only a “subset” of EPA-approved uses. 40 C.F.R. § 152.130(b) (2005). This is known as “subset labeling.”

FIFRA does not establish an exclusively federal regime of pesticide regulation; it expressly reserves some regulatory authority to the states. 7 U.S.C. § 136v(a) (2000) (“A State may regulate the sale or use of any federally registered pesticide or device in the State, but only if and to the extent the regulation does not permit any sale or use prohibited by this subchap-ter.”). With regard to labeling, FIFRA declares that states are not allowed to add new and different labeling requirements to the FIFRA standards. 7 U.S.C. § 136v(b) (2000) (“Such State shall not impose or continue in effect any requirements for labeling or packaging in addition to or different from those required under this subchapter.”).

As the Supreme Court remanded specifically for reconsideration in light of its decision in Bates, we will review that decision in detail. In Bates, Texas peanut farmers (“Texas farmers”) sought damages from Dow Agrosciences LLC (“Dow”) for injury to their crops caused by application of a Dow pesticide. The pesticide had been registered with the EPA under FI-FRA and labeled for use “in all areas where peanuts are grown.” Bates, 544 U.S. at 434, 125 S.Ct. at 1793. Application of the product not only failed to control weeds, it severely damaged the Texas farmers’ peanut crops. Id. The Texas farmers alleged that Dow knew or should have known that use of the product on soil with a high Ph level like the Texas farmers’ would damage the peanuts, but Dow nevertheless claimed both on the product label and in its equivalent sales pitches that the product could be used in all areas. Id. The Texas farmers sued Dow on several legal grounds, including strict liability, negligence, fraud, breach of warranty, and violation of the Texas Deceptive Trade Practices-Consumer Protection Act. Bates, 125 S.Ct. at 1793-94.

The district court held that these claims were preempted by FIFRA. The United States Court of Appeals for the Fifth Circuit affirmed, reading the FIFRA preemption provision, 7 U.S.C. § 136v(b), to preempt any state law claim in which “a judgment against Dow would induce it to alter its product label.” Bates, 125 S.Ct. at 1793 (quoting Dow Agrosciences v. Bates, 332 F.3d 323, 331 (5th Cir.2003)).

The Supreme Court reversed, rejecting the broad “inducement” test employed by the court 'of appeals and adopting a more narrow test for FIFRA preemption under section 136v(b). Bates, 125 S.Ct. at 1791. The Court initially explained that in an earlier case it had rejected a claim that FIFRA preempted a local ordinance that required a permit for aerial application of pesticides even though the ordinance imposed requirements not found in FIFRA, because the Court had concluded that “FI-FRA was not ‘a sufficiently comprehensive statute to justify an inference that Congress had occupied the field to the exclusion of the States.’ ” Bates, 125 S.Ct. at 1797 (quoting Wisconsin Pub. Intervenor v. Mortier, 501 U.S. 597, 607, 111 S.Ct. 2476, 115 L.Ed.2d 532 (1991)). Rather, the Court had concluded, “[FIFRA] leaves ample room for States and localities to supplement federal efforts * * Id. (quoting Mortier, 501 U.S. at 613, 111 S.Ct. 2476).

The Court then turned to the specific preemption language of section 136v(b), which provides: “Such State shall not impose or continue in effect any requirements for labeling or packaging in addition to or different from those required under this subchapter.” Interpreting this provision, the Court first explained that it applies only to “requirements” imposed by the state and declared that “[t]he Court of Appeals was therefore quite wrong when it assumed that any event, such as a jury verdict, that might ‘induce’ a pesticide manufacturer to change its label should be viewed as a requirement.” Bates, 125 S.Ct. at 1798.

The Court proceeded to delineate the scope of preemption established by section 136v(b) by describing the characteristics a state law requirement must have for preemption to apply:

For a particular state rule to be preempted, it must satisfy two conditions. First it must be a requirement “for labeling or packaging rules governing the design of a product, for example, are not pre-empted. Second, it must impose a labeling or packaging requirement that is “in addition to or different from those required under [FIFRA].” A state regulation requiring the word “poison” to appear in red letters, for instance, would not be preempted if an EPA regulation imposed the same requirement.

Bates, 125 S.Ct. at 1798. Thus, the Court established, first, that a state law claim is not preempted under FIFRA unless it imposes a requirement, and, second, that a requirement is not preempted unless it satisfies two factors: it must be a requirement (1) for labeling or packaging, (2) that is in addition to or different from FIFRA requirements.

The Court next applied these factors to the Texas state law claims asserted in Bates. First, the Court held that the claims for defective design, defective manufacture, negligent testing, and breach of express warranty were not preempted, because none of the common law rules on which those claims were based “requires that manufacturers label or package their products in any particular way.” Bates, 125 S.Ct. at 1798. In particular, the Court ruled that the breach of express warranty claim was not a requirement for labeling or packaging even though Dow had placed its express warranty on the pesticide’s label. Id. at 1798-99. The Court explained that the state common law rule requiring the manufacturer to honor its voluntary contractual warranty commitment did not require the manufacturer to provide a warranty or to say anything in particular in that warranty and therefore was not a requirement for labeling or packaging. Id. In this context, the Court again rejected the reasoning of the court of appeals that a state claim would be preempted if an adverse ruling would “induce” the manufacturer to change its label. The Court stated:

In arriving at a different conclusion, the court below reasoned that a finding of liability on these claims would “induce Dow to alter [its] label.” 332 F.3d at 332 (footnote omitted). This effects-based test finds no support in the text of § 136v(b), which speaks only of “requirements.” A requirement is a rule of latv that must be obeyed; an event, such as a jury verdict, that merely motivates an optional decision is not a requirement. The proper inquiry calls for an examination of the elements of the common-law duty at issue, see Cipollone[ v. Liggett Group, Inc.], 505 U.S., [504] at 524[, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992)]; it does not call for speculation as to whether a jury verdict will prompt the manufacturer to take any particular action (a question, in any event, that will depend on a variety of cost/benefit calculations best left to the manufacturer’s accountants).

Id. at 1799 (emphasis added).

The Court viewed the Texas farmers’ fraud and negligent-failuré-to-warn claims differently. The Court explained that the common law duties underlying those claims were requirements for labeling and packaging, because those claims were based on allegations that false statements and inadequate warnings on the product label violated the state-imposed standards of conduct. Id. at 1799-1800.

But that alone was not enough to establish preemption. The Court then addressed the remaining prong of the FI-FRA preemption test, whether the state-law labeling and packaging requirements were “in addition to or different from” FIFRA requirements. The Court emphasized that “a state-law labeling requirement is not pre-empted by § 136v(b) if it is equivalent to, and fully consistent with, FIFRA’s misbranding provisions.” Bates, 125 S.Ct. at 1800. The Court explained at length the foundation and rationale for this “parallel requirements” reading of section 136v(b). Bates, 125 S.Ct. at 1800-03. The Court summarized the limited scope of FIFRA preemption regarding pesticide labeling as follows:

In sum, under our interpretation, § 136v(b) retains a narrow, but still important, role. In the main, it pre-empts competing state labeling standards-— imagine 50 different labeling regimes prescribing the color, font size, and wording of warnings — that would create significant inefficiencies for manufacturers. The provision also pre-empts any statutory or common-law rule that would impose a labeling requirement that diverges from those set out in FIFRA and its implementing regulations. It does not, however, pre-empt any state rules that are fully consistent with federal requirements.

Bates, 125 S.Ct. at 1803 (footnote omitted).

Acknowledging that the parties had not adequately briefed the issue of whether the Texas common law fraud and failure-to-warn claims imposed duties of truth in labeling greater than those imposed by FIFRA, the Court remanded that issue to the court of appeals. In conjunction with that remand to determine if the state and federal labeling requirements were equivalent, the Court explained that in order to “ensure that nominally equivalent labeling requirements are genuinely equivalent,” if the case went to trial the jury should be instructed on the relevant FIFRA mis-branding standards and regulations. Bates, 125 S.Ct. at 1804.

It is significant that the Court also made the point that a state requirement applicable to oral statements does not qualify as a requirement for “labeling or packaging” covered by section 136v(b). The Court observed:

To the extent that petitioners’ warranty and fraud claims are based on oral representations made by Dow’s agents, they fall outside the text of § 136v(b) for an independent reason. Because FIFRA defines labeling as “all labels and all other written, printed, or graphic matter” that accompany a pesticide, § 136(p)(2), any requirement that applied to a sales agent’s oral representations would not be a requirement for “labeling or packaging.”

Bates, 125 S.Ct. at 1798 n. 17. Even the concurrence and dissent echoed this narrow view of the “labeling or packaging requirement” factor, in explaining that “[a] state-law cause of action, even if not specific to labeling, nevertheless imposes a labeling requirement ‘in addition to or different from’ FIFRA’s when it attaches liability to statements on the label that do not produce liability under FIFRA.” Bates, 125 S.Ct. at 1805 (Thomas, J., concurring in part and dissenting in part) (emphasis added).

II.

From our careful reading of Bates, we conclude that the United States Supreme Court adopted in that case narrower standards for finding preemption under FI-FRA than we applied in our earlier decision. We stated that the issue was “whether one could reasonably foresee that the manufacturer, in seeking to avoid liability for the error, would choose to alter the product or label.” Peterson III, 675 N.W.2d at 71 (quoting Worm v. Am. Cyanamid Co., 5 F.3d 744, 747-48 (4th Cir.1993)). This was essentially the effects-based test used by the Fifth Circuit in Bates that was emphatically rejected as too broad by the Supreme Court. See pp. 125 S.Ct. at 1797, 1799, supra. We also cited favorably a federal district court decision addressing FIFRA preemption in the context of a claim under the New Jersey Consumer Fraud Act in which the court ruled that “[w]hen advertising or promotional materials merely repeat information or language contained on the label, claims directed at the advertising necessarily challenge the label itself and are therefore preempted.” Peterson III at 70 (quoting Mortellite v. Novartis Crop Protection, Inc., 278 F.Supp.2d 390, 401 (D.N.J.2003)). In Bates, the Supreme Court rejected this approach. Even though, as the Court had observed earlier in the opinion, the oral sales presentations at issue in Bates were the equivalent of statements on the product label, 125 S.Ct. at 1793, the Court explained that to the extent the farmers’ warranty and fraud claims imposed liability based on oral representations made by sales agents, those claims would not be preempted because they would not be requirements for “labeling or packaging.” Id. at 1798 n. 17. The C.ourt’s rejection of the effects-oriented inducement test and its refusal to view regulation of oral statements, even those that mirror label language, as requirements for labeling or packaging, demonstrate that state regulation must be very directly related to labeling and packaging in order to invoke FIFRA preemption.

As in our earlier decision, our conclusion on remand turns on this crucial determinant. That is, FIFRA preemption applies only if the state requirement on which liability is based is directly addressed to labeling or packaging. We concluded initially, and we do so again, that the farmers’ claims that BASF engaged in fraud, deception, and unconscionable conduct in violation of the New Jersey Consumer Fraud Act are based on BASF’s marketing and advertising actions and not on the content of the product labels.

BASF makes two broad arguments in seeking relief based on Bates. First, BASF contends that the farmers’ claims are preempted under FIFRA and BASF is entitled to prevail as a matter of law. Second, BASF argues that at a minimum it is entitled to a new trial based on evi-dentiary rulings and denial of jury instructions. We address these arguments in turn.

A. FIFRA Preemption

BASF’s contention that farmers’ claims are preempted as a matter of law is based on three sub-arguments. First, BASF contends that the core of the farmers’ claims is that BASF impermissibly marketed Poast and Poast Plus as separate products, when they are really one and the same. BASF asserts that as it was required under FIFRA to label Poast and Poast Plus separately, the farmers’ claims must be preempted because they would impose liability for conduct required by FIFRA. Second, BASF asserts that the farmers claim that BASF’s labeling of Poast Plus for fewer crops than it was registered for with the EPA violated the NJCFA. BASF argues that because FI-FRA expressly allows manufacturers to “subset” label EPA-registered products, the farmers’ claims seek to impose liability for conduct that is expressly allowed by FIFRA labeling regulations, and the farmers’ claims are therefore preempted. Third, BASF argues that the farmers’ claims would require a manufacturer to market a product in all 50 states and for all crops for which it is EPA-registered, regardless of the manufacturer’s concerns that additional testing is needed to assure safe and efficacious use in all areas or on all crops. BASF argues that this aspect of the farmers’ claims is contrary to Bates because of the Court’s acknowledgement in that case of the continued regulatory role of the states and the fact that tort claims are not preempted under FIFRA in order to encourage manufacturers to exercise caution in the labeling of their products.

The salient question for purposes of FIFRA preemption, as made crystal clear in Bates, is whether the farmers’ claims under the New Jersey Consumer Fraud Act impose a requirement for labeling or packaging that is in addition to or different from FIFRA requirements. The farmers assert that their claims are not based on the content of the product labels, but rather on the deceptive, fraudulent, and unconscionable nonlabel actions of BASF in pursuing its planned marketing strategy to segment the use of Poast and Poast Plus. As we said in our initial decision:

The court of appeals * * * held that “the farmers’ claims were based on BASF’s misleading statements and omissions as to the EPA-authorized uses of the products, not on the claims that BASF committed fraud in the labeling or packaging.” Peterson II, 657 N.W.2d at 865. Further, the court of appeals noted that “the farmers here were not asserting that BASF’s registration and container labels were false or misleading, * * * [rjather, the farmers’ point was that even if BASF’s labels were technically accurate, BASF could and did commit consumer fraud by leading farmers to believe that the cheaper Poast Plus could only be used on major corps * ⅜ Id.

Peterson III, 675 N.W.2d at 70.

As before, we believe the farmers and the court of appeals more accurately characterize the nature of the farmers’ claims. The farmers presented evidence that BASF advertised Poast Plus as only “registered” for use on four major crops, cotton, soy beans, peanuts, and alfalfa, when it was EPA-registered for numerous minor crops as well. BASF advertised that Poast was the “only” post-emergent grass herbicide registered for use on minor crops, although Poast Plus was also registered for use on minor crops. A BASF executive candidly admitted this was a material omission. Additionally, BASF attempted to prevent word from spreading that Poast Plus was EPA-registered for use on minor crops. BASF had its public relations firm submit for publication a magazine article discussing increased enforcement of fines for failing to follow label recommendations, and BASF falsely told the North Dakota Department of Agriculture that BASF could not add crops that were on the Poast label to the Poast Plus label because the EPA would require it to do further residue testing, which would cost the company millions of dollars. In this ease the conduct that violated the New Jersey Consumer Fraud Act was not the labeling or packaging of Poast and Poast Plus, but BASF’s deceptive advertising, literature, magazine articles, and misrepresentations to North Dakota authorities. The conduct at issue is analogous to the oral sales representations that the Supreme Court found in Bates to be outside the scope of FIFRA preemption, which is narrowly limited to regulation of the label and packaging itself.

Based on the record, we again reject BASF’s characterization of the farmers’ claims as requiring that the two products be labeled as one. While the farmers might have believed that would have been a more honest approach for BASF to take, that was not the factual or legal basis for their claims. The duty the farmers’ claims imposed on BASF was not to register and label Poast and Poast Plus as one product, but rather, having registered and labeled them separately, to refrain from deceptive statements about their EPA registration, their active ingredient composition, and their relative efficacy on major and minor crops.

For the same reasons, we cannot agree with BASF that the farmers’ claims seek to impose liability for BASF’s choice to use subset labeling, which is allowed under FIFRA. Again, the farmers’ claims do not challenge the legality of BASF’s subset labeling, but rather its misrepresentations about the products, their registration, and their capacities noted above.

With regard to BASF’s third argument, that the farmers’ claims would require marketing products in all 50 states and on all crops for which they are EPA-registered, regardless of the manufacturer’s concerns for safety and the need for additional testing, we note first that this is a policy-oriented argument that is not founded on the preemption criteria under FI-FRA. Moreover, we are compelled to observe that under the facts of this case the argument bears little credibility. BASF assured the EPA that no additional testing was required for its registration of Poast Plus for minor crops because the results would be the same as those it had submitted in support of its registration of Poast. Furthermore, evidence was submitted that established that the choice in this case to limit state registration and availability of Poast Plus for use on minor crops was a marketing decision intended to maximize profits, not generated by safety concerns.

Regarding BASF’s arguments that farmers’ claims should be preempted by FIFRA as a matter of law, we note in conclusion that in light of the Supreme Court’s clarification of the appropriate FI-FRA preemption standards, it has become even more apparent that the debate in this case is not about the correct preemption standard or about the legal standard imposed by application of the New Jersey statute in the context of the farmers’ claims. Instead, the fundamental debate is simply about how the farmers’ claims are accurately characterized. Because we conclude that the record supports the farmers’ characterization of their claims as based on nonlabel conduct, under Bates there is no FIFRA preemption.

B. Evidence and Jury Instruction Rulings

BASF argues that even if the farmers’ claims are not pre-empted by FIFRA, BASF is nevertheless entitled to a new trial because (a) evidence about the contents of the Poast Plus and Poast labels was introduced at trial, “inviting the jury to hold BASF liable for fraud on the basis of the labeling,” and (b) the court refused to instruct the jury regarding FIFRA labeling regulations, which BASF claims is required by Bates.

First, the farmers contend correctly that these arguments were procedurally waived by BASF. Although BASF made these arguments to the court of appeals in Peterson II and the court rejected them, see 657 N.W.2d at 871-73, BASF did not mention either evidentiary rulings or jury instructions in its statement of issues or otherwise in its petition for review to this court from Peterson II. We ruled in Peterson III that issues must be raised in a petition for review or they are waived. 675 N.W.2d at 66-67; see also Hapka v. Paquin Farms, 458 N.W.2d 683, 686 (Minn.1990). Moreover, the evidentiary issues were not raised in BASF’s briefs to this court in Peterson III. Jury instructions were not raised as an independent claim of error, but as support for BASF’s preemption argument. It is well-established that failure to address an issue in brief constitutes waiver of that issue. E.g., Melina v. Chaplin, 327 N.W.2d 19, 20 (Minn.1982).

Furthermore, these arguments were not automatically preserved as part of BASF’s preemption argument. Although BASF ties these arguments to preemption because their resolution in some degree is related to the nature and permissible scope of the farmers’ claims and BASF’s defenses, these arguments are more accurately viewed as challenges to trial rulings about evidence and jury instructions. They are not the same as BASF’s legal argument that farmers’ claims are preempted by FIFRA.

Finally, BASF is not permitted to resurrect these waived arguments because of a change in the law by the Supreme Court in Bates. These arguments were available to BASF (and were made by BASF in Peterson II) prior to Bates. Nothing the Supreme Court said in Bates created new law that made these arguments newly-available, particularly in view of the fact that the Court narrowed the test for FIFRA preemption in Bates, rather than expanding it.

Even if these arguments were not waived, BASF would not prevail. First, BASF objects to the district court’s decision to allow information from the Poast and Poast Plus labels to be introduced at trial. The evidence to which BASF objects includes the names of the products, the percentages of active ingredients in each, the instructions for use, and the approved uses. BASF claims this evidence should have been excluded because it was irrelevant to any nonlabel-based claim and was strongly prejudicial, because it may have permitted the jury to consider whether the label information was deceptive in reaching its verdict.

“The district court has broad discretion in ruling on evidentiary matters and we will not overturn a district court’s evidentiary rulings unless appellant shows a clear abuse of discretion ⅜ * State v. Steward, 645 N.W.2d 115, 120 (Minn.2002). Evidence is considered relevant if it has “any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence.” Minn. R. Evid. 401. However, relevant evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice. Minn. R. Evid. 403.

The district court admitted the evidence of the chemical composition of Poast and Poast Plus, instructions for their use, and other label information because it provided background for the evidence of non-label conduct that the farmers claimed was deceptive. We conclude that given the significant degree of relevance and the high standard of Minn. R. Evid. 403 (the evidence must be substantially more prejudicial than probative before it is excluded), the district court did not abuse its discretion in admitting the evidence.

Next, BASF claims that it is entitled to a new trial because the district court refused to instruct the jury regarding FI-FRA regulations, specifically:

• That EPA regulations “required BASF to register Poast and Poast Plus as separate products.”
• That “EPA’s regulations prohibited BASF from using the exact same name for Poast and Poast Plus.”
• That “EPA regulations allow manufacturers to distribute or sell pesticides under labeling bearing any subset of the directions for use approved by the EPA.”
• That “EPA allows a company to label an herbicide for fewer crops than registered by the EPA.”
• That “[a] manufacturer of pesticides has no duty under federal or state law to label pesticides for specific crop uses.”
• That the jury could not find “[t]he omission of any information from, or the inclusion of any information on” the Poast Plus label to be a violation of the NJCFA.
• That every state requires separate registration of pesticides and may deny registration and bar use of the pesticide notwithstanding EPA registration.

BASF argues that the court’s refusal to give these instructions violated the Supreme Court’s statement in Bates that courts “should instruct the jury on the relevant FIFRA misbranding standards, as well as any regulations that add content to those standards.” Bates, 125 S.Ct. at 1804.

Given the context of the Court’s statement about jury instructions in Bates, we do not understand it to require instructions on FIFRA regulations in every case in which FIFRA preemption is raised. As explained above, the Court interpreted two of the Texas farmers’ claims in Bates to be based on the truth or falsity of the content of the product label. This raised the question whether the legal standard imposed on the label content by the Texas common law claims was equivalent to the misbrand-ing standards in FIFRA, an issue the Court determined had not been adequately briefed. In remanding for a determination on that issue, the Court also addressed the hypothetical scenario of that issue of equivalence of state and federal labeling requirements going to trial. In that context, the Court raised the issue of jury instructions, stating:

To survive pre-emption, the state-law requirement need not be phrased in the identical language as its corresponding FIFRA requirement; indeed, it would be surprising if a common-law requirement used the same phraseology as FI-FRA. If a ease proceeds to trial, the court’s jury instructions must ensure that nominally equivalent labeling requirements are genuinely equivalent. If a defendant so requests, a court should instruct the jury on the relevant FIFRA misbranding standards, as well as any regulations that add content to those standards. For a manufacturer should not be held liable under a state labeling requirement subject to § 136v(b) unless the manufacturer is also liable for mis-branding as defined by FIFRA.

Bates, 125 S.Ct. at 1804 (third emphasis added).

Thus, when liability under state law is alleged to arise based on the content of the label, the court must ensure, through jury instructions if requested, that the defendant is not held liable based on a state standard that is substantively different than the FIFRA misbranding standards. This case, however, did not involve claims of deceptive labeling, but rather deceptive nonlabel conduct.

Moreover, appellate review of jury instructions is limited:

When determining the adequacy of jury instructions, this court reviews for an abuse of discretion. The district court has considerable latitude in selecting language for jury instructions. Jury instructions are viewed as a whole to determine whether they fairly and adequately explain the law. An instruction is error if it materially misstates the law.

State v. Moore, 699 N.W.2d 733, 736 (Minn.2005) (internal citations omitted). The district court’s decision must be viewed in the context of the case. During the trial, BASF presented extensive expert testimony on the nature of FIFRA and its regulations. Additionally, BASF admits that the farmers never asserted that BASF violated FIFRA. The farmers’ closing and opening statements describe and dwell on BASF’s advertising misstatements and its false statements to government officials, mentioning labeling and registration only to explain the nature of the marketing scheme. Finally, BASF’s attorney argued extensively in closing about FIFRA, state registration, and their relevance to the case. Given this context, the jury had already been informed at length that BASF was compliant with labeling laws and that BASF could not be held liable for its labels. The court did not want to confuse the jury with instructions on labeling law when it was not alleged that BASF had labeled incorrectly. Therefore, the district court refused to include the requested jury instructions.

As the court of appeals stated in rejecting this argument:

BASF’s proposed instructions do not relate directly to the charge before the jury, which was whether BASF violated the NJCFA. Further, throughout the entire trial, the jury heard numerous discussions of these issues and the various witnesses’ descriptions of the effect of the regulations. These topics were more properly the subject of counsel’s final argument rather than jury instructions, and the court did not abuse its discretion in denying the request to include these instructions.

Peterson II, 657 N.W.2d at 871. We agree and conclude that the district court did not abuse its discretion in denying the requested jury instructions.

Affirmed.

PAGE and ANDERSON, G. BARRY, JJ., took no part in the consideration or decision of this matter.

GILDEA, J., not having been a member of this court at the time of the argument and submission, took no part in the consideration or decision of this matter.

BLOOMQUIST, Acting J.

      . The class does not include farmers from North Dakota who participated in a separate class action against BASF that was settled.

      . Poast Plus contains 13% sethoxydim, while Poast contains 18%. However, when mixed and used according to the directions, they both have a gallons-to-acres-covered ratio of 0.19%. In other words, they provide the same amount of active ingredient per acre when correctly applied. Poast Plus also contains an “adjuvant” (an ingredient that modifies the action of the principal ingredient). But in order to use Poast, farmers must add an adjuvant. In fact, when registering Poast Plus with the FDA as safe for use on minor crops, BASF claimed that no further study of Poast Plus's effects on minor crops was needed because "the proposed label directions for use in the above listed crops for Poast Plus are identical to those for the registered product Poast Herbicide.”

      ."Major” crops include such crops as soybeans, peanuts, cotton, and corn, which are grown in huge quantities for low prices. "Minor” crops, such as sugarbeets, vegetables, and fruits are grown on fewer acres but bring a much higher profit per acre.

      . There are few herbicides that can be used on minor crops, which means there is little price competition in that area. In contrast, the herbicide market for major crops is competitive. BASF’s goal, as stated in its 1990 marketing plan, was to price Poast Plus low to effectively compete with other major crop herbicides while keeping the price of Poast high to exploit the lack of competition in the minor crop market.

      . This type of Supreme Court action, granting, vacating, and remanding, is known as a "GVR order." It is not a ruling on the merits.
      [A] GVR order is neither an outright reversal nor an invitation to reverse; it is merely a device that allows a lower court that had rendered its decision without the benefit of an intervening clarification to have an opportunity to reconsider that decision and, if warranted, to revise or correct it. The GVR order itself does not constitute a final determination on the merits; it does not even carry precedential weight.

        Gonzalez v. Justices of Mun. Court of Boston, 420 F.3d 5, 7 (1st Cir.2005) (citation omitted). See also South Dakota v. United States Dept. of Interior, 423 F.3d 790, 796 n. 5 (8th Cir.2005) ("A GVR does not compel a particular determination or outcome, but occurs often when an intervening development may affect the outcome of the case.”).

      . Under FIFRA, "weed” is included in the definition of "pest” and herbicide therefore is included in the term "pesticide.” 7 U.S.C. § 136(t), (u) (2000).

      . The Court explained that state common law standards, as well as statutes and regulations, on which liability is based can constitute requirements. Id. In Bates the Court focused primarily on the Texas common law claims. In contrast, here the claims involve statutory liability under the NJCFA.

      . The Court pointed out further that because the common law warranty claim was not preempted, the Texas farmers’ statutory claim was not preempted to the extent it was based on breach of warranty. Id. at 1799 n. 18.

      . The Court explained that FIFRA requires truth in labeling under its provisions that prohibit labels from containing "false or misleading” statements and inadequate instructions or warnings. 7 U.S.C. §§ 136(q)(l)(A), (F), and (G) (2000). Thus, a state requirement that precludes false or deceptive statements about a product can be enforced against label content as long as the state requirement is equivalent in relevant part to these FIFRA requirements. Bates, 125 S.Ct. at 1800.

      . The provision of the NJCFA that BASF was found to have violated provides:
      The act, use or employment by any person of any unconscionable commercial practice, deception, fraud, false pretense, false promise, misrepresentation, or the knowing, concealment, suppression, or omission of any material fact with intent that others rely upon such concealment, suppression or omission, in connection with the sale or advertisement of any merchandise or real estate, or with the subsequent performance of such person as aforesaid, whether or not any person has in fact been misled, deceived or damaged thereby, is declared to be. an unlawful practice * * ⅜.
      N.J. Stat. Ann. § 56:8-2 (West 2001). BASF does not contend every claim brought under this statute would be preempted by FIFRA, so it is necessary to assess the particular claims asserted by the farmers in this case.

      . In contrast, in seeking registration for Poast Plus for minor crops, BASF had told the EPA, and the EPA agreed, that no additional residue testing was necessary because Poast Plus used the same active ingredient in the same quantity per acre as the already-tested and registered Poast. See n. 3, supra.

      . For instance, BASF indicated in its 1990 marketing plan that its goal was to price Poast Plus low to effectively compete with other major crop herbicides while keeping the price of Poast high to exploit the lack of competition in the minor crop market. Additionally, when the North Dakota Commissioner of Agriculture contacted the EPA to inquire about the Poast Plus registration, she was informed that the EPA had already registered Poast Plus for all crops for which Poast was registered (and had done so at BASF's request), and that BASF was not allowing Poast Plus use on minor crops for marketing reasons.

      . Indeed, in terms of characterizing claims, although BASF avoids presenting them as such, it appears to us that its arguments that the farmers' claims would require BASF to label Poast and Poast Plus as one product and to market it in all states for all crops are in reality "effects-based” arguments. That is, the success of farmers' claims might induce such conduct on the part of BASF. But, as explained above, the Supreme Court soundly rejected the effects-based inducement test for FIFRA preemption in Bates.


author: PAGE, Justice. ANDERSON, PAUL H., Justice

text:
    KMART CORPORATION, Relator, v. COUNTY OF CLAY, Respondent, and American Crystal Sugar Company, Relator, v. County of Clay, Respondent.
    Nos. A05-590, A05-591.
    Supreme Court of Minnesota.
    March 30, 2006.

      Thomas R. Wilhelmy, Steven J. Quam, Fredrikson^ & Byron, P.A., Minneapolis, MN, for Relator, Kmart Corporation.
    Kenneth Kohler, Clay County Attorney, Michelle C. Winkis, Chief Assistant County Attorney, Moorhead, MN, for Respondent, County of Clay.
    Myron L. Frans, Mark D. Savin, Lisa R. Pugh, Faegre & Benson, L.L.P., Minneapolis, MN, for Relator, American' Crystal Sugar Company.
   OPINION

PAGE, Justice.

In two separate appeals, relators, American Crystal Sugar Company (ACS) and Kmart Corporation (Kmart), appeal the Minnesota Tax Court’s dismissals of their 2003 Clay County real property tax petitions. ACS and Kmart assert separate and distinct tax claims that were litigated separately in the tax court and separately appealed and briefed to this court. Nevertheless, because the procedural facts and legal issues presented by the two appeals are identical, we address both appeals in this combined opinion. Respondent Clay County (County) filed motions to dismiss the tax petitions, contending ACS and Kmart failed to properly serve the county assessor and the county attorney as required by Minn.Stat. § 278.01, subd. 1(a) (2004). The County also claimed that ACS and Kmart failed to timely file proof of service as required by Minn.Stat. § 278.01, subd. 1(c) (2004). ACS and Kmart opposed the County’s motions, arguing the service on the county assessor and the county attorney was adequate in light of the officials’ refusal to accept service. Further, they argued that their failure to file proof of service by the statutory deadline did not deprive the tax court of jurisdiction. The tax court granted the County’s motions to dismiss, holding that for purposes of Minn.Stat. § 278.01, subd. 1(a), ACS and Kmart failed to personally serve the county assessor and the county attorney. The court also held that ACS and Kmart could not use facsimile service under Minn. R. Civ. P. 5.01 for original tax petitions. The court, therefore, concluded that it did not have jurisdiction over ACS’s and Kmart’s tax petitions.

On appeal, ACS and Kmart argue that the tax court erred in concluding that it did not have jurisdiction over their tax petitions and in granting the county’s motions to dismiss. . Specifically, ACS and Kmart claim that: (1) the court erroneously determined that they had failed to personally serve the county assessor and the county attorney pursuant to Minn.Stat. § 278.01, subd. 1(a); (2) the court erred in concluding their attempt to serve the original petitions under Minn. R. Civ. P. 5.01 by facsimile was ineffective; and (3) their failure to timely file the required proof of service under Minn.Stat. § 278.01, subd. 1(c), did not deprive the tax court of jurisdiction. We affirm.

In April 2003, ACS and Kmart hired Metro Legal Services (Metro Legal) to file tax petitions in Clay, Becker, and Norman Counties. Minnesota Statutes § 278.01, subd. 1(a), provides that a taxpayer may challenge a county’s property tax assessment “by serving one copy of a petition for such determination upon the county auditor, one copy on the county attorney, one copy on the county treasurer, and three copies on the county assessor.” Subdivision 1(c) of section 278.01 provides that the taxpayer “must file the copies [of the petition] with proof of service, in the office of the court administrator of the district court on or before April 30 of the year in which the tax becomes payable.”

On April 30, 2003, Metro Legal successfully served and filed tax petitions for ACS, Kmart, and a third taxpayer not involved in this appeal in Becker County and Norman County. Metro Legal proceeded to Clay County, arriving at the county auditor’s office shortly after 4:10 p.m. Once there, the petitions were served on the county auditor, who reviewed the petitions, signed the acknowledgements of service on the back of the petitions, and returned a signed original and a signed copy of each petition to Metro Legal.

Metro Legal proceeded across the hall to the Clay County Treasurer’s office at approximately 4:15 p.m. and handed the petitions to the county treasurer, Betty Swetland, who reviewed the petitions of ACS and the third party before signing the acknowledgment of service. After that, Swetland looked at a clock and said, “It is 4:33 p.m., I am not going to accept the [Kmart petition]. You can come back in the morning because we are closed.”

After leaving the treasurer’s office, Metro Legal walked across the parking lot to the Clay County Courthouse, where the county assessor and the county attorney are located, and discovered that the doors were locked. At approximately 5:00 p.m., Metro Legal called the county assessor at his home in an effort to arrange service of the petitions that evening. The county assessor informed Metro Legal that his office was closed, that Metro Legal had until 4:30 to serve the petitions, and that he was not available to be served that evening, but could be served the next day. After several attempts to locate and serve the county assessor at home failed, Metro Legal left copies of the petitions between the storm door and the front door of the county assessor’s home.

Metro Legal also called the county attorney at her office and home, but did not reach her. The county attorney returned Metro Legal’s call at about 5:30 p.m. According to Metro Legal, the county attorney said that Metro Legal had until 4:30 to serve the papers and was “out of luck.” The county attorney, however, testified that she did not tell Metro Legal that she was not going to accept service that night and that she “would never say those words.” According to the county attorney, she told Metro Legal that she would be at work the next day and she could be served then. Subsequent efforts to find the county attorney at her office, home, and at a soccer field were unsuccessful and, ultimately, copies of the petitions were left underneath a rug on the porch ' of the county attorney’s home.

Sometime after 9:30 that evening, Metro Legal began faxing copies of all of the tax petitions to the offices of the county treasurer, county assessor, and county attorney and the Clay County Court Administrator. Regarding proof of service, the' record indicates that the court administrator’s office received the back page of the Kmart petition, which included the county auditor’s acknowledgment of service. The record, however, does not indicate that the back page of the ACS petition, which contained the county auditor and county treasurer’s acknowledgement of service, was received. Moreover, none of the petitions included proof of service, by either ac-knowledgement or affidavit, on the county assessor and the county attorney. On May 1, 2003, Metro Legal filed the original petitions with affidavits of service upon the county assessor and the county attorney in the Clay County Court Administrator’s office, indicating that copies of the petitions had been left at the county assessor and the county attorney’s homes, as well as faxed to their respective offices.

“We review tax court decisions to determine whether the court lacked jurisdiction, whether the court’s decisions are supported by the evidence and in conformity with the law, and whether the court committed any other error of law.” Bond v. Comm’r of Revenue, 691 N.W.2d 831, 835 (Minn.2005). While not bound by the tax court’s decisions, we will only overrule the court if its decision “is clearly erroneous because the evidence as a whole does not reasonably support the decision.” Id. at 835-36. Moreover, we review the tax court’s legal determinations de novo. ILHC of Eagan, LLC v. County of Dakota, 693 N.W.2d 412, 419 (Minn.2005). When, as here, the resolution of the parties’ claims turn on the application of a statute to undisputed facts, the applicable standard of review is de novo. Morton Bldgs., Inc. v. Comm’r of Revenue, 488 N.W.2d 254, 257 (Minn.1992).

These cases raise a number of issues. The primary issue is whether ACS and Kmart served the tax petitions on the Clay County Assessor, Clay County Attorney, Clay County Auditor, and Clay County Treasurer on or before April 30, 2003, as required by Minn.Stat. § 278.01, subd. 1. In our view, resolution of this issue is dispositive of this case. Because there appears to be no dispute between ACS, Kmart, and the County as to whether ACS and Kmart timely served the petitions on the county auditor and the county treasurer, we focus our attention on whether the county attorney and county assessor were effectively served.

ACS and Kmart first argue that personal service was complete when they made reasonable attempts to serve the petitions and the county assessor and the county attorney refused to accept them. ACS and Kmart further argue that, as public officials, the county assessor and the county attorney had an obligation to cooperate with their attempts to serve them on April 30, even after regular business hours. Clay County does not directly address the question of whether leaving copies of the tax petitions at the county assessor and the county attorney’s homes qualifies as adequate service under Minn.Stat. § 278.01, subd. 1(a). Instead, the county simply asserts that the service was incomplete and argues that the lack of complete service was due to ACS’s and Kmart’s own negligence. The county further asserts that the county assessor and the county attorney acted appropriately on April 30, 2003, because county officials are not required to be available to the public outside of their 8:00 a.m. to 4:30 p.m. “duty day.”

Minnesota Statutes § 278.01, subd. 1(a), requires service on the four designated county officials to initiate a property tax claim, but the method of service required is not defined in the statute. Rule 81 of the Minnesota Rules of Civil Procedure provides that the rules of civil procedure govern chapter 278 proceedings as long as the provisions of the statute and the rules are consistent and not in conflict. Minn. R. Civ. P. 81.01; see also Minn.Stat. § 271.06, subd. 7 (2004) (providing that the rules of civil procedure apply to proceedings in the tax court where practicable). In requiring service of a petition, section 278.01, subdivision 1(a), prescribes the means of initiating a property tax claim under chapter 278 in either district court or tax court. The permissible methods of serving the pleadings that initiate a civil action in district court (and through section 271.06, subdivision 7, in tax court) are prescribed in Minn. R. Civ. P. 4. Because chapter 278 contains no definition of service, there is no conflict between the statute and the rule that would prevent application of the rule. Accordingly, we will look to Minn. R. Civ. P. 4 for the parameters of effective service under section 278.01, subdivision 1(a).

Here, Metro Legal attempted service on the county assessor and the county attorney by two methods: personal service and service by facsimile. Rule 4 does authorize personal service of initiating documents, specifying the methods for personal service on an individual in Minn. R. Civ. P. 4.03(a). As applicable here, Rule 4.03(a) provides that personal service can be accomplished “by delivering a copy to the individual personally or by leaving a copy at the individual’s usual place of abode with some person of suitable age and discretion then residing therein.” ACS and Kmart do not contend that Metro Legal delivered copies of the petition to the officials personally or left copies with any person at the officials’ usual places of abode. Accordingly, they did not effect valid personal service on the officials in the manner authorized in Rule 4.03(a).

Further, on this record, we find no merit in ACS’s and Rmart’s argument that, even if the service in question was technically incomplete, the county is not entitled to dismiss their tax petitions because the failure to complete the service was caused by the county assessor’s and the county attorney’s refusal to accept the service. In support of this argument, ACS and Kmart rely on Nielsen v. Braland, 264 Minn. 481, 119 N.W.2d 737 (1963), and Carlson v. Cohen, 302 Minn. 531, 223 N.W.2d 810 (1974). Neither case is helpful to relators. Nielsen stands for the proposition that a defendant could not physically refuse to accept service when the defendant was in close proximity to the processor server, was touched with summons, and the summons was laid in a place easily accessible to him. 264 Minn. at 484, 119 N.W.2d at 739. Carlson stands for the proposition that placing the summons and complaint under the windshield wiper of a defendant’s car as the defendant attempted to evade service in the driveway of her home constitutes proper service. 302 Minn. 531, 223 N.W.2d 810. In each case, the process server was in close proximity to the person being served when the person being served either refused service or took steps to avoid being served. That is .not the case here. In this case, Metro Legal was never in close physical proximity to either the county attorney or the county assessor and neither of the officials took any extraordinary step to avoid service. We also note that, while ACS and Kmart assert that the county officials had a statutory duty to make themselves available for service after county business hours, they cite no authority for that proposition; nor have we found any. While county officials may choose to make themselves available for service after business hours, we find no basis on which to conclude that they are legally obligated to do so.

ACS and Kmart also argue that their facsimile transmission of the petitions to the assessor and the county attorney on the evening of April 30, 2003, qualified as effective service under Minn.Stat. § 278.01, subd. 1(a). According to ACS and Kmart, under “Minn. R. Civ. P. 4.03(e)(l)[,] a lawsuit against a county is commenced by personal service of the county auditor,” while Minn. R. Civ. P. 5.01 and 5.02 provide “every pleading subsequent to the original complaint” can be made, among other means, by “transmitting a copy by facsimile machine to the attorney, or the party’s office.” Because the county auditor was the first official served in the instant case, ACS and Kmart assert that “service on the other officials was service subsequent to the original complaint.” We disagree.

Rule 4 of the Minnesota Rules of Civil Procedure does not include any provision for service by facsimile. Facsimile service is authorized under Minn. R. Civ. P. 5.02, but Rule 5 applies only to service of documents after an action has been initiated. See Minn. R. Civ. P. 5.01; see also 1 David F. Herr & Roger S. Haydock, Minnesota Practice — Civil Rules Ann. § 4.6 (4th ed. 2002) (“Rule 4 should not be confused with Rule 5, which allows service by fax or mail only after a lawsuit has been properly commenced by using a Rule 4 method of service”). Minnesota Statutes § 278.01, subd. 1(a), states that to initiate a challenge to a county’s property tax assessment the petition must be served on the county’s auditor, treasurer, attorney, and assessor. Therefore, we read section 278.01 subdivision 1(a), to require service on each of the officials in order to commence the action. Thus, effective service of the petition on one of the officials does not make service of the petition on the other officials service of a “pleading subsequent to the original.” Because facsimile service is not authorized for service of initiating documents in the rules of civil procedure, we agree with the tax court that faxing the petitions to the offices of the county assessor and the county attorney did not effect valid service.

Having concluded that ACS and Kmart failed to make effective service of their tax petitions on the Clay County Assessor and Clay County Attorney as required by section 278.01, subdivision 1(a), we need not address their other contentions. Accordingly, we affirm the dismissal of their tax petitions.

Affirmed.

GILDEA, J., not having been a member of this court at the time of the argument and submission, took no part in the consideration or decision of this case.

ANDERSON, PAUL H., Justice

(concurring).

I concur with the majority because I agree that ASC’s and Kmart’s service was defective, as the county attorney and the county assessor were not appropriately served on or before April 30, 2003, as required by Minn.Stat. § 278.01, subd. 1(a) (2004). But the inappropriate nature of the Clay County Treasurer’s actions in this case and the possibility that the majority opinion might be interpreted to condone such prejudicial behavior induces me to write separately. As the majority notes, Metro Legal arrived at the Clay County Treasurer’s Office and handed the petitions to the Clay County Treasurer at 4:15 p.m. on April 30, 2003. Upon being handed the petitions, the treasurer perused them for approximately 18 minutes before signing the acknowledgement of service. After signing the acknowledgement, the treasurer then announced, “It is 4:33 p.m., I am not going to accept the [Kmart petition]. You can come back in the morning because we are closed.”

It is undisputed that Metro Legal entered the Clay County Treasurer’s Office during business hours and effectively served the treasurer with the required petitions 15 minutes before office closing time. Further, the county acknowledges that service upon the treasurer was effectively made. Nevertheless, the treasurer’s decision to hold the Kmart petition for over 15 minutes — until after closing time— and then announce that, because her office was now closed, she would not accept the Kmart petition raises a valid question about her behavior. A public official cannot attempt to thwart effective service simply by refusing to acknowledge a document she is holding in her hand until after the acceptable time of service has elapsed. Based on the record before us, I conclude that ASC’s and Kmart’s petitions were validly served upon the treasurer before closing time for the Clay County Treasurer’s Office and as such the treasurer should have honored her public trust by accepting service. If service upon the treasurer had been the only impediment to ASC and Kmart avoiding dismissal of their petitions because of defective service, I would reverse and let them proceed with them actions.

      . Metro Legal contracted the task to an independent process server, who then hired an assistant to serve the petitions. In this opinion, we refer to both the processor server and the assistant as Metro Legal.


text:
    Carol DREYLING, et al., Relators, v. COMMISSIONER OF REVENUE, Respondent.
    No. A05-970.
    Supreme Court of Minnesota.
    March 30, 2006.

      John E. Mack, Mack & Daby, P.A., New London, MN, for Relators.
    Michael Hatch, Minnesota Attorney General, Craig R. Anderson, Assistant Attorney General, Minnesota Commissioner of Revenue, Daniel A. Salmone, St. Paul, MN, for Respondent.
   OPINION

ANDERSON, RUSSELL A., Chief Justice.

Relators Roger and Carol Dreyling appeal a tax court judgment affirming an order of the Commissioner of the Minnesota Department of Revenue (the commissioner) assessing additional income taxes, penalties, and interest for tax years 1998, 1999, and 2000. We affirm the judgment of the tax court as to the additional income taxes, interest, and penalties assessed for substantial underpayment under Minn. Stat. § 289A.60, subd. 4 (2004), but reverse as to the assessment of penalties for fraud under Minn.Stat. § 289A.60, subd. 6 (2004).

Roger Dreyling (Dreyling) was born and raised in Minnesota. He and Carol married in 1958. In 1966, Dreyling graduated from medical school. Shortly thereafter, Dreyling established a medical practice in Paynesville, Minnesota. Since 1981, the Dreylings have owned a home in Paynes-ville that they treat as their homestead for property tax purposes.

After he retired from the full-time practice of medicine in 1997, Dreyling entered into temporary employment agreements with two tribal organizations in Alaska. Under these agreements, Dreyling obtained an Alaska medical license and worked as a physician in Alaska for 26 days in 1998 and 68 days in 1999. He spent the balance of each year traveling in Alaska, at his home in Minnesota and in Florida, where the couple also owned a home. Carol Dreyling continued to live and work as a piano teacher in Paynesville, although she traveled with her husband on a few occasions. While in Alaska, Dreyl-ing lived in temporary housing provided rent-free by his employers. He used a mailbox rented from Mail Boxes Etc. as his Alaska mailing address, but his paychecks were sent to his home in Paynes-ville. Dreyling continued to maintain a Minnesota physician’s license and took continuing medical education courses in Minnesota in 1998 and 1999. Dreyling obtained an Alaska driver’s license but never physically surrendered his Minnesota license. Although Dreyling registered to vote in Alaska, he never did so. Dreyl-ing titled a car in Alaska, but it was insured under his Minnesota policies. Dreyling’s insurance, banking, and financial relationships were centered in Minnesota, and he never joined any clubs or community organizations in Alaska. Nor did Dreyling ever acquire any real property in Alaska, although he testified he considered the possibility. In 2000, Dreyl-ing’s health began to fail, and after 2000, he was no longer employed as a physician in Alaska.

For 1998, 1999, and 2000, Dreyling and Carol filed joint income tax returns indicating that Carol was a resident of Minnesota and Dreyling was a resident of Alaska. Before filing these returns, Dreyling reviewed the criteria for nonresident taxpayer status provided by his tax preparer. Dreyling independently determined that he was not a resident of Minnesota in 1998, 1999, and 2000, and reported his income for those years as nonresident income not subject to Minnesota income tax. But the commissioner audited the Dreylings’ income tax returns and determined that Dreyling was a resident of Minnesota in 1998, 1999, and 2000. Because Minnesota residents are not entitled to allocate any portion of their income to another jurisdiction, the commissioner assessed additional income taxes, underpayment and fraud penalties, and interest totaling $30,905.19. Dreyling appealed to the tax court from the commissioner’s order of October 10, 2003. Dreyling v. Comm’r of Revenue, No. 7622-R, 2005 WL 473893, at *1 (Minn. T.C. Oct. 10, 2003). The tax court found that Dreyling was a resident of Minnesota in 1998 and 1999, and affirmed in all respects the commissioner’s order assessing penalties. Id. at *1-2.

Dreyling appeals from the tax court’s judgment, contending that he is entitled to nonresident taxpayer status and reversal of the fraud penalties. We conclude that the tax court’s finding that Dreyling was a Minnesota resident in. 1998 and 1999 was justified by the evidence. But we also conclude that the tax court’s finding that Dreyling failed to prove that fraud penalties were improper was not justified by the evidence.

I.

The taxpayer bears the burden of demonstrating that the commissioner’s assessment is incorrect or invalid. Minn. Stat. § 270.68, subd. 3 (2004) (repealed and recodified- in 2005 at Minn.Stat. § 270C.61, subd. 4); Minn.Stat. § 289A.37, subd. 3 (2004) (repealed and recodified in 2005 at Minn.Stat. § 270C.33, subd. 6); F-D Oil Co., Inc. v. Comm’r of Revenue, 560 N.W.2d 701, 707-08 (Minn.1997). We review a decision of the tax court to determine if it is not justified by the evidence or not in conformity with the law. Minn.Stat. § 271.10, subd. 1 (2004); Wybierala v. Comm’r of Revenue, 587 N.W.2d 832, 835 (Minn.1998). When reviewing the tax court’s findings of fact, we determine whether sufficient evidence exists to support the tax court’s derision. Wybierala, 587 N.W.2d. at 835. The tax court is in the best position to evaluate the credibility of witnesses. Manthey v. Comm’r of Revenue, 468 N.W.2d 548, 550 (Minn.1991). Issues of law, however, we review de novo. Wybierala, 587 N.W.2d at 835.

II.

All net income of resident taxpayers is subject to Minnesota income tax. Minn. Stat. § 290.014, subd. 1 (2004). Nonresidents, but not residents, may allocate a portion of their income to other jurisdictions. Minn.Stat. § 290.17, subd. 1 (2004). A “resident” can be either “any individual domiciled in Minnesota” or “any individual domiciled outside the state who maintains a place of abode in the state and spends in the aggregate more than one-half of the tax year in Minnesota.” Minn.Stat. § 290.01, subd. 7 (2004). ' Spouses are presumed to have the same domicile unless there is affirmative evidence to the contrary or the spouses are legally separated or divorced. Minn. R. 8001.0300, subp. 2 (2005).

Dreyling argued below that he was'not a resident pf Minnesota in 1998 and 1999 under either test because (1) he was not domiciled in Minnesota, and (2) although he maintained a “place of abode” in the state, he was not domiciled here and did not spend more than one-half of either year in Minnesota.

“Domicile” means bodily presence in a place coupled with an intent to make that place one’s home. Miller’s Estate v. Comm’r of Taxation, 240 Minn. 18, 19, 59 N.W.2d 925, 926 (1953). Once established, a domicile is presumed to continue until the contrary is shown. Minn. R. 8001.0300-, subp. 2. As a result, one may live in another state for a period of time without affecting one’s Minnesota domicile. See Comm’r of Revenue v. Stamp, 296 N.W.2d 867, 870 (Minn.1980).

Because Dreyling does not dispute that he was bodily present in Minnesota during the years in question, his intent to change his domicile is the determinative issue. Rules promulgated by the commissioner establish 26 nonexclusive factors to aid in the determination of domicile. Minn. R. 8001.0300, subpt. 3 (2005).

In Manthey, we affirmed the tax court’s finding that a pipeline worker did not change his domicile from Minnesota to Alaska even though he spent most of his time in Alaska, purchased real estate in Alaska, engaged in everyday commerce in Alaska, received hiring preferences as a certified Alaska resident, received dividends from the Alaska Permanent Fund, obtained an Alaska driver’s license, registered and licensed his car and trailer in Alaska, purchased resident hunting and fishing licenses in Alaska, registered to vote and voted in Alaska elections, performed jury duty in Alaska, joined a fraternal organization in Alaska, and only traveled to Minnesota to visit his wife and children for 4 to 6 weeks of the year in 8 out of the 9 years he lived in Alaska. 468 N.W.2d at 549.

In comparison, Dreyling worked in Alaska on a strictly temporary basis, used a rented mailbox from Mail Boxes Etc. as his Alaska address, obtained an Alaska driver’s license (using his address at Mail Boxes Etc.), obtained Alaska resident fishing and hunting licenses, never voted in Alaska, and registered one motor vehicle in Alaska in 1999 (which he sold in Minnesota in that same year). Dreyling, 2005 WL 473893, at *1-2. Dreyling concedes that he was not eligible to receive dividends from the Alaska Permanent. Fund and that he never purchased real property in Alaska. And, like Manthey, Dreyling financially supported his wife in Minnesota, owned and licensed motor vehicles in Minnesota, owned real property in Minnesota, continued to maintain banking accounts in Minnesota, and left Alaska for good when he suffered health problems. Like Manthey, Dreyling’s wife remained a domiciliary of Minnesota.

The tax court found that Dreyling was domiciled in Minnesota in 1998 and 1999. Dreyling, 2005 WL 473893, at *6. The tax court then concluded that because Dreyling was domiciled in Minnesota in 1998 and 1999, he was a resident of Minnesota for tax purposes in those years as well. Id. at *10; see also Minn.Stat. § 290.01, subd. 7 (providing that a “resident” includes “any individual domiciled in Minnesota”).

Dreyling argues that, of the factors listed in Minn. R. 8001.0300, subp. 3, the sheer quantity of factors favoring nondo-miciliary status outweighs the factors favoring domicile in Minnesota. Nothing in either the statute or the rules supports such a formulaic approach. Rather, as Rule 8001.0300, subp. 2, provides: “No positive rule can .be adopted with respect to the evidence necessary to prove an intention to change a domicile but such intention may be proved by acts and declarations, and of the two forms of evidence, acts must be given more weight than declarations.” As we have observed, each case turns on its own peculiar facts and circumstances. Stamp, 296 N.W.2d at 870.

Dreyling also argues on appeal that he has met his burden of proving that he was not domiciled in Minnesota because the quality of factors he claims favor nondomi-ciliary status outweigh the factors he concedes favor domicile in Minnesota. We reject any attempt to elevate the importance of one factor over another. As Rule 8001.0300, subp. 3, specifically provides, “Any one of the items listed above will not, by itself, determine domicile.” Taking the factors under Rule 8001.0300, subp. 3, as a whole, we conclude that the tax court’s finding that Dreyling failed to meet his burden of proving that he was not a resident of Minnesota in 1998 and 1999 was justified by the evidence. We therefore affirm that, for tax purposes, Dreyling was a resident of Minnesota in 1998 and 1999.

III.

Dreyling also argues that even if we hold that he was a resident of Minnesota in 1998 and 1999, the fraud penalties imposed for 1998, 1999 and 2000 should be reversed. We agree. “If a person files a false or fraudulent return, or attempts in any manner to evade or defeat a tax or payment of tax, there is imposed on the person a penalty equal to 50 percent of the tax.” Minn.Stat. § 289A.60, subd. 6 (modified in 2005 to read: “If a person, with intent to evade or defeat a tax or payment of tax * * * files a false or fraudulent return, or attempts in any other manner to evade or defeat a tax or payment of tax, there is imposed on the person a penalty equal to 50 percent of the tax.”) Once assessed, the taxpayer bears the burden of proving that a fraud penalty is improper. Wybierala, 587 N.W.2d at 837 (citing F-D Oil Co., 560 N.W.2d at 708).

According to the evidence introduced at trial, Dreyling was audited as part of the “CRV project,” the nature of which was not disclosed at trial. According to the commissioner’s audit log and time summary, the commissioner assessed fraud penalties against Dreyling for five reasons:

Taxpayer made false statements, evasive response and attempts to mislead. The return is incorrect to such an extent and in respect to items of such character and magnitude as to compel one to conclude that the underreporting was known and deliberate. There is a pattern of consistent failure to fully report Minnesota income. Taxpayer has a high level of education. Taxpayer had ability to pay the correct tax due.

The department conceded at trial the only false statement Dreyling made was filing as a nonresident. As to the second and third reasons, the department does not contend that Dreyling deliberately omitted or attempted to conceal items of his gross income. Dreyling, 2005 WL 473893, at *12. Rather, the department contends that Dreyling intentionally misal-located a portion of his taxable income for each year to Alaska. We do not equate this with the type of knowing and deliberate underreporting of income that often constitutes fraud. Nor can we equate this dispute to “a pattern of consistent failure to fully report income.” Dreyling fully disclosed all income. His dispute with the commissioner revolves around a single issue-residency-that affects the classification of thqt income and affects multiple years, but it is still only one dispute. As to the fourth factor cited by the department, Dreyling may have a high level of education, but it is not in business, accounting, or tax. Nor do we agree that taxpayers who have “the ability to pay the correct tax due” are more likely to have the requisite state of mind than those who are unable to pay the correct tax due.

The tax court found that Dreyling failed to prove that fraud penalties were improper, essentially because (1) Dreyling was a sophisticated taxpayer who reviewed the criteria for nonresident taxpayer status before filing his returns, (2) Dreyling filed as a nonresident despite the lack of substance to his claim that he was domiciled in Alaska, (3) Dreyling’s allocation of income to Alaska resulted in a persistent and substantial understatement of his Minnesota taxable income, and (4) Dreyling’s conduct during the audit, and the records he supplied, were inadequate to disprove the foregoing. See Dreyling, 2005 WL 473893, at *12-13.

We conclude that Dreyling met his burden to prove that a fraud penalty was improper under the facts here. Dreyling testified that he first considered moving to Alaska upon graduation from medical school in 1965, but that he rejected the idea because at the time he and his wife had four young children and Alaska lacked educational opportunities for them comparable to those in Minnesota. Dreyling testified that, after his retirement from practice in Minnesota, he wanted to move to Alaska permanently, but was reluctant to sever all of his ties to Minnesota without knowing whether his move to Alaska would “work out.” As it turns out, Dreyl-ing stopped practicing medicine in Alaska after 2000 for health reasons, and not because the move to Alaska did not otherwise “work out.”

As Dreyling testified, he reviewed the criteria for nonresident taxpayer status before filing his returns, and concluded he qualified as a nonresident. Dreyling’s tax preparer also testified that, in the preparer’s opinion, Dreyling satisfied at least some of the criteria listed in Minn. R. 8001.0300. Dreyling reported all of his Alaskan income, disagreeing with the commissioner only over his residency. There was no evidence Dreyling had ever been audited, or paid any penalties for understating his income or filing late, until the returns in question here.

While we do not condone a taxpayer’s failure to cooperate completely with the commissioner, Dreyling maintained at least some records to document his out-of-state residence, and produced the bulk of the documents requested by the commissioner. Dreyling testified he did not produce documentation for 1998 because he believed that year was beyond the statute of limitations. But Dreyling did produce copies of his credit card statements showing his purchases in 1999 and 2000. The commissioner never subpoenaed any of Dreyling’s records, and Dreyling’s refusal to produce all available documentation supporting his out-of-state travel was appropriately construed against him in calculating the number of days he was present in the state. See Blumberg v. Palm, 238 Minn. 249, 254, 56 N.W.2d 412, 415 (1953) (failure to produce evidence within the control of a party permits an inference that the evidence, if produced, would be unfavorable to the party). When Dreyling realized he was not out of the state for the required number of days in 2000, Dreyling readily conceded the issue.

Dreyling testified to these matters under oath and denied that, in claiming non-residency, he intended to defraud the state. While we ordinarily defer to the trial court on matters of credibility, here the tax court made no finding that Dreyling’s testimony in this respect was not worthy of belief. Dreyling’s denial, while self-serving, is supported by the circumstantial evidence of his intent.

We conclude that the tax court’s finding that Dreyling failed to prove that fraud penalties were improper was not justified by the evidence. We therefore reverse the imposition of fraud penalties. The record reflects that Dreyling has paid the penalties assessed under Minn.Stat. § 289A.60, subd. 4, for substantially understating his Minnesota taxes.

Affirmed in part, reversed in part.

GILDEA, J., not having been a member of this court at the time of the argument and submission, took no part in the consideration or decision of this case.

      . Carol Dreyling is a named party because the Dreylings filed joint income tax returns, but she acknowledges that she was a Minnesota resident during the years in question and she has not participated in this case.

      . Dreyling testified that he developed symptoms of cardiac problems that culminated in a six-vessel cardiac bypass in 2002. He also testified to a total knee replacement in 2001, aggravated by the Alaskan weather. In addition, at trial he wore a brace on his right foot.

      . Before trial in the tax court, Dreyling conceded that he was a resident of Minnesota in 2000. In this action, Dreyling is still contesting the fraud penalty imposed for that year.

      . Dreyling claims that, of the 26 factors listed in the rule, ten factors favor non-domicile, two factors clearly favor Minnesota domicile, another two or three somewhat favor Minnesota domicile, and the rest are either inapplicable or do not favor one domicile over the other.

      . Dreyling claims the following factors are among those favoring domicile in Alaska: “location of employment,” "location of newly acquired living quarters whether owned or rented,” “jurisdiction in which a valid driver’s license was issued,” and “location of business relationships and the place where business is transacted.”

      . Dreyling agrees that “location of social, fraternal or athletic organizations or clubs” and "whether resident or nonresident hunting and fishing licenses were purchased [in 1999]” favor Minnesota domicile.

      . The statute of limitations for assessment of taxes is three and one-half years from the time a return is filed, but this limit does not apply to fraudulent returns. Minn.Stat. § 289A.38, subds. 1, 5 (2004).