author: HALBROOKS, Judge.

text:
    In re the Marriage of Janet Marie ROBERT, Petitioner, Respondent, v. John Anthony ZYGMUNT, Appellant.
    No. C7-02-67.
    Court of Appeals of Minnesota.
    Oct. 8, 2002.

      James L. Berg, Chaska, MN, for respondent.
    Alan C. Eidsness, Lisa T. Spencer, Henson & Efron, P.A., Minneapolis, MN, for appellant.
    Considered and decided by HALBROOKS, Presiding Judge, KLAPHAKE, Judge, and SHUMAKER, Judge.
   OPINION

HALBROOKS, Judge.

In this marital-dissolution dispute, appellant John Zygmunt challenges the trial court’s award of summary judgment to respondent Janet Robert. Appellant argues that the trial court erred or abused its discretion by concluding that (1) stock purchased from an inheritance trust in exchange for a promissory note secured by the stock itself was nonmarital property, (2) respondent’s interest in a Subchapter S corporation’s retained-earnings account was nonmarital property, (3) appellant was not entitled to spousal maintenance, and (4) appellant had not shown undue hardship warranting an invasion of respondent’s nonmarital property. We affirm.

FACTS

The 21-year marriage of appellant John Zygmunt and respondent Janet Robert was dissolved by judgment and decree on April 19, 2000. The parties have one child, now emancipated. Respondent’s family owns Siegel-Robert, Inc. (Siegel-Robert), a closely held corporation. Respondent’s parents gave respondent several individual gifts of Siegel-Robert stock both before and during the parties’ marriage and gave appellant individual gifts of stock during the marriage. The parties agree that these separate gifts of stock are the non-marital property of each party.

During their marriage, the parties lived a relatively modest lifestyle financed almost exclusively by respondent’s distributions from her Siegel-Robert stock. By profession, appellant is a playwright and respondent an attorney, but during the marriage neither party worked full-time to support the family or established a career in any specific location. The parties typically held short-term jobs for little or no pay and relocated at will, living in various parts of the United States and Canada until settling near the Twin Cities in 1987.

Respondent’s father died in 1996. His will directed that his entire estate, consisting primarily of Siegel-Robert stock, be held in a marital trust, with his wife (respondent’s mother) acting as trustee. The will gave respondent’s mother a life estate in the trust and divided the remainder interest equally among respondent and her siblings. The will authorized respondent’s mother to enter into any transactions necessary to minimize the total tax liability of the estate and its beneficiaries.

Respondent’s mother divided the marital trust into three separate trusts, including a qualified terminable interest property trust (“QTIP”) that held a controlling interest of Siegel-Robert shares. The estate’s tax planner determined that the estate’s tax liability would be substantially reduced if the QTIP held only a minority interest in Siegel-Robert by the time respondent’s mother died. The tax planner accordingly arranged a stock-purchase transaction whereby respondent and each of her siblings purchased an equal number of shares from the QTIP. The children each signed a promissory note with a 15-year term, a pledge agreement, and a redemption agreement. The promissory notes were secured by the shares to be purchased, which were held by the QTIP trust. The pledge agreement and redemption agreement provided that the children could redeem the shares held by the trust in order to pay the annual installments on the note.

None of the children’s spouses signed any of the documents related to the stock-purchase agreement. At the time of trial, respondent had not made any payment on the note using marital or nonmarital funds and had not commingled the QTIP stock with any marital asset. Instead, when the note’s first and second annual installments came due, respondent redeemed shares held as security by the QTIP to meet her obligation on the note.

After respondent’s father died, the Sie-gel-Robert board of directors further reduced the corporation’s tax liability by voting to convert Siegel-Robert from a Subchapter C corporation to a Subchapter S corporation for tax purposes. See I.R.C. §§ 301-385, 1361-1379 (2000) (defining and explaining Subchapter S and Subchapter C corporations). As a Sub-chapter S corporation, Siegel-Robert does not pay corporate-level taxes on its income. See I.R.C. § 1363. Instead, the corporation’s income is taxed directly to its shareholders based on their ownership of corporate stock, whether or not the income is actually distributed to the shareholders. See I.R.C. §§ 1366-1368. A Subchapter S corporation monitors its retained corporate earnings using an accumulated adjustments account (“AAA”), which is used to determine each shareholder’s basis for taxed but undistributed corporate income. See id. Siegel-Rob-ert’s AAA monitored the amount of income attributable to respondent’s shares in the corporation. Although this undistributed income was taxed to respondent and appellant on the parties’ joint income-tax returns, Siegel-Robert, and not the parties, always paid the tax; no marital assets were ever used for this purpose. Siegel-Robert never set aside an account for respondent with any funds in it, and no funds were ever distributed to either party from the AAA.

At the time of dissolution, respondent was working ten hours a month for nominal wages and receiving $360,000 net annual income from Siegel-Robert in stock distributions and director’s fees; appellant was pursuing his playwriting career but earning no income.

Before trial, the court granted respondent summary judgment as to the QTIP stock, agreeing with respondent’s argument that the stock was not marital property subject to division. The trial court reasoned that the stock-purchase agreement, as an estate-planning device, did not transform respondent’s remainder in the family trust from nonmarital to marital property, but merely accelerated respondent’s possession of the nonmarital bequest.

After a trial on the remaining issues, the trial court concluded that the AAA was also nonmarital property, reasoning that because Siegel-Robert always paid the tax burden created by the AAA and only nominally borne by the parties, the AAA had no effect on the parties’ marital assets or income. The trial court also concluded that appellant was not entitled to spousal maintenance and that appellant had demonstrated no special hardship entitling him to a portion of respondent’s nonmarital property. This appeal follows.

ISSUES

1. Was the Siegel-Robert stock respondent purchased from the QTIP marital property?

2. Was respondent’s basis in the Sie-gel-Robert retained-earnings account marital property?

3. Did the trial court properly deny appellant spousal maintenance?

4. Did the trial court properly decline to invade respondent’s nonmarital property to alleviate appellant’s financial hardship?

ANALYSIS

I.

Appellant challenges the trial court’s conclusion that the QTIP stock respondent acquired pursuant to the stock-purchase transaction remained a nonmarital asset, arguing that the stock became divisible marital property when respondent purchased it from the trust. We disagree and hold that the trial court did not err by granting respondent summary judgment on this issue.

We review appeals from grants of summary judgment to determine “(1) whether there are any genuine issues of material fact and (2) whether the lower courts erred in their application of the law.” State by Cooper v. French, 460 N.W.2d 2, 4 (Minn.1990) (citation omitted); see also Minn. R. Civ. P. 56.03. We need not defer to the trial court’s decision on a pure question of law. Frost-Benco Elec. Ass’n v. Minnesota Pub. Utils. Comm’n, 358 N.W.2d 639, 642 (Minn.1984). “Whether property is marital or nonmari-tal is a question of law, but a reviewing court must defer to the trial court’s underlying findings of fact.” Olsen v. Olsen, 562 N.W.2d 797, 800 (Minn.1997) (citation omitted).

All property obtained by either spouse during the marriage is presumed to be marital property. Minn.Stat. § 518.54, subd. 5 (2000). “To overcome the presumption that property is marital, a party must demonstrate by a preponderance of the evidence that the property is nonmari-tal.” Olsen, 562 N.W.2d at 800 (citation omitted); see also Minn.Stat. § 518.54, subd. 5. Nonmarital property includes property that is acquired as a bequest made to one spouse but not to the other, as well as a party’s remainder interest inherited in property subject to a life estate. Minn.Stat. § 518.54, subd. 5(a), (c); Theroux v. Boehmler, 410 N.W.2d 354, 357 (Minn.App.1987). For property to retain its nonmarital character, it must be kept separate from marital property or be readily traceable to an identifiable non-marital asset. Olsen, 562 N.W.2d at 800.

Appellant acknowledges that respondent’s remainder interest in the QTIP is nonmarital, but argues that the stock purchased from the QTIP, as property obtained during the marriage in exchange for a marital debt, was presumptively marital. See Minn.Stat. § 518.54, subd. 5. He asserts that the stock-purchase transaction did not merely accelerate respondent’s remainder interest while preserving its non-marital character, but converted it from respondent’s inheritance to divisible marital property.

Although there is some merit in appellant’s arguments, the terms and circumstances of the stock-purchase transaction here lead us to conclude that the stock purchased by respondent from the QTIP remained nonmarital property. First, we do not agree that the promissory note exchanged for the stock represented a marital debt. It is undisputed that respondent had a nonmarital remainder interest in the QTIP stock prior to the stock-purchase transaction and that the promissory note was secured by the QTIP stock itself, which remained in the trust’s possession. By the terms of the stock-purchase agreement, respondent is entitled, and has consistently chosen, to surrender the shares held as security in order to meet her obligations under the note, effectively using the stock to pay for itself. We conclude that because the promissory note was secured wholly by respondent’s non-marital remainder interest in the QTIP and involved no personal or marital assets, it was not a marital debt.

Consequently, the QTIP stock acquired by respondent pursuant to the stock-purchase transaction was not marital property. We have previously held that an estate-planning device designed to minimize tax burdens does not alter the marital or nonmarital character of property. See Pfleiderer v. Pfleiderer, 591 N.W.2d 729, 732-33 (Minn.App.1999) (holding that “transferring joint property into one party’s name for estate planning purposes does not convert marital property into nonmarital property”). Here, the stock-purchase transaction was developed by an estate planner in order to further the goal, as expressed by respondent’s father in his will, of reducing the tax liability of the estate and its beneficiaries. The transaction was designed so that payment for the stock purchase could be generated from the stock itself, with no contribution of marital or personal assets. On these facts, we conclude that the stock purchased from the QTIP, which was respondent’s non-marital property before the transaction, did not become marital property by operation of the estate-planning device.

Appellant argues that respondent’s remainder interest is strictly limited to the assets of the QTIP at the time of her mother’s death and that when respondent placed a promissory note in the QTIP in exchange for the stock, she acquired a remainder interest in the promissory note and lost her nonmarital interest in the stock. He therefore contends that respondent’s stock is marital property. But respondent indisputably had a nonmarital remainder interest in the stock held in the QTIP, subject to a life estate in her mother, prior to the stock-purchase transaction. Respondent purchased the stock from the trust in a transaction secured by the stock itself and involving no marital funds. While there are circumstances under which a party’s purchase of nonmarital property could convert the property into marital property, no such circumstance is present here because the stock was not commingled with marital property and because the funds for its purchase were generated by, and were, therefore, directly traceable to the stock itself. See Olsen, 562 N.W.2d at 800. Here, respondent secured the purchase with nonmarital assets, made no initial down payment for the stock, signed the purchase agreement, and has only made payments on the note by authorizing the QTIP to redeem shares in its possession.

Under these circumstances, we conclude that the promissory note signed by respondent was not a marital debt of the parties. Consequently, the QTIP stock acquired by respondent pursuant to the stock-purchase transaction remained a nonmarital inheritance after the transaction. Because the evidence was sufficient to rebut the presumption that respondent’s QTIP stock purchase was marital, the trial court did not err in granting respondent summary judgment on this issue.

II.

Appellant challenges the trial court’s conclusion that the Siegel-Robert AAA is respondent’s nonmarital property, arguing that the AAA is marital property because it contains earned income taxed to the marital estate and' because its value is attributable to respondent’s efforts. Whether a Subchapter S corporation’s retained earnings are marital property is an issue of first impression in Minnesota.

We note first that the Siegel-Rob-ert AAA is not “income” under the plain meaning of Minn.Stat. § 518.54, subd. 6 (2000), which defines “income” as “any form of periodic payment to an individual.” Although the Internal Revenue Code treats AAA earnings as income attributable to individual shareholders for federal tax purposes, there is no evidence in the record before us that an asset-bearing account was set aside by Siegel-Robert for respondent or that any amounts were, or will be, held in such an account or distributed to either party. Retained earnings and profits of a corporation are a corporate asset and remain the corporation’s property until severed from other corporate assets and distributed as dividends. See Hoffmann v. Hoffmann, 676 S.W.2d 817, 827 (Mo.1984). Respondent agrees that Siegel-Robert dividends actually paid to the parties were marital property. But because Siegel-Robert never distributed the retained earnings to respondent, the earnings never became respondent’s income under Minn.Stat. § 518.54.

Appellant argues that the AAA must be considered a marital asset because the income allocated to the AAA was taxed to the parties as income earned. But appellant does not contend, and there is no evidence, that any marital assets were used to pay the tax on the retained earnings associated with respondent’s shares of Siegel-Robert stock.

There is no evidence that respondent has the right to distribute the AAA to herself or other Siegel-Robert shareholders. Appellant’s reliance on Metz-Keener v. Keener, 215 Wis.2d 626, 573 N.W.2d 865, 866-68 (1997), for the proposition that a Subchapter S corporation’s AAA is marital property is therefore misplaced because there,.the party was the sole shareholder and manager of the corporation, had full access to the retained earnings, and could distribute the earnings at will. Appellant has not cited any authority — and we are not aware of any — that would require us to consider a party’s interest in a corporation’s retained earnings to be a marital asset where the party, like respondent here, is a minority shareholder, plays little to no role in the daily management of the corporation, and lacks control over the distribution of the corporation’s income. Indeed, our research indicates that, consistent with Metz-Keener, courts in other jurisdictions will only consider a corporation’s retained earnings to be a party’s income if the party has substantial control over a corporation’s earnings or is the sole stockholder. See, e.g., Bleth v. Bleth, 607 N.W.2d 577, 579 (N.D.2000); Mitts v. Mitts, 39 S.W.3d 142, 148 (Tenn.Ct.App.2000).

Here, the AAA was created when respondent and the other members of the Siegel-Robert board of directors voted to convert Siegel-Robert into a Subchapter S corporation. Appellant argues that the retained earnings are marital property because they are attributable to respondent’s entrepreneurial efforts during the marriage. See Nardini v. Nardini, 414 N.W.2d 184, 192 (Minn.1987) (holding that an increase in the value of nonmarital property attributable to the efforts of one or both spouses during marriage is marital property); White v. White, 521 N.W.2d 874, 878 (Minn.App.1994) (stating that such efforts include a party’s contribution of funds, labor, or entrepreneurial decision-making to the nonmarital property). We disagree.

We have held that an individual who is a board member, officer, and employee of a corporation controlled by his family, but who is not involved in the key functions of the business and only minorly involved in the business, does not contribute an effort to the corporation’s income. Duffey v. Duffey, 416 N.W.2d 830, 833 (Minn.App.1987), review denied (Minn. Feb. 24, 1988). Here, respondent plays no role in the management or day-to-day operation of the corporation, and she is not a corporate officer or employee. We do not agree with appellant that by attending quarterly board meetings, voting annually on distributions, and voting once to alter the corporate tax structure, respondent engaged in the kind of active effort contemplated by Nardini or entrepreneurial decision-making described in White.

The AAA. is not a distributive, asset-bearing account attributable to either party’s marital effort but rather is a notational device designed to measure the income attributable to respondent’s Siegel-Robert shares for federal tax purposes. We, therefore, hold that the AAA was not a marital asset and affirm the trial court’s determination that the account is respondent’s nonmarital property.

III.

Appellant argues that the trial court abused its discretion by denying his request for spousal maintenance. A trial court has broad discretion in determining spousal maintenance, and we will not overturn the trial court’s decision absent an abuse of discretion. Erlandson v. Erlandson, 318 N.W.2d 36, 38 (Minn.1982). A trial court abuses its discretion by resolving the matter in a manner that is “against the logic and the facts on the record.” Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn.1984). That the record might support findings other than those made by the trial court does not render the findings clearly erroneous, ahd we view the “evidence in the light most favorable to the trial court’s findings.” Vangsness v. Vangsness, 607 N.W.2d 468, 474 (Minn.App.2000). When reviewing the evidence regarding spousal maintenance, we leave credibility determinations to the fact-finders because they are in the best position to make such assessments. Prahl v. Prahl, 627 N.W.2d 698, 702 (Minn.App.2001).

A spousal-maintenance award is appropriate when one spouse demonstrates that he or she lacks sufficient property to provide for his or her reasonable needs or is otherwise unable to reasonably provide adequate self-support. Minn.Stat. § 518.552, subd. 1 (2000). In determining the amount and duration of a maintenance award, a court should consider (1) the financial resources of the party seeking maintenance; (2) the likelihood of the party seeking maintenance becoming fully or partially self-supporting given the party’s age and skills or ability to learn new skills; (3) the standard of living established during the marriage; (4) the duration of the marriage; (5) the loss of earnings, seniority, retirement benefits, and other employment opportunities forgone by the spouse seeking spousal maintenance; (6) the age and the physical and emotional condition of the party seeking maintenance; (7) the ability of the other spouse to meet his or her needs while also meeting those of the spouse seeking maintenance; and (8) the contribution of each party to the marital property and to the furtherance of the other’s employment or business. Minn. Stat. § 518.552, subd. 2 (2000).

First, we observe that appellant has significant financial resources at his disposal. His final property award exceeded $670,000. The parties stipulated that appellant can earn more than $32,000 annually in returns on Ms investments. A vocational expert testified at trial that appellant is capable of earning more than $30,000 annually as a copywriter. The record does not support appellant’s contention that the trial court miscalculated his expenses by disregarding various taxes and expenses. Nor does the record support appellant’s contention that the trial court’s denial of spousal maintenance is an abuse of discretion because it deprives him of the opportunity to maintain the standard of living the parties enjoyed during their marriage. The record is clear that the parties’ lifestyle for 18 of the marriage’s 21 years was modest. The trial court properly refused to give greater weight to the parties’ lifestyle in the final years of the marriage, when respondent’s income increased due to her father’s death. Appellant’s contention that he is “entitled” to pursue his chosen nonremunerative vocation and be “amply supported” by respondent is without merit.

Appellant argues that the trial court improperly imputed income to him without finding that he is underemployed in bad faith; in support, he erroneously relies on Maurer v. Maurer, 607 N.W.2d 176 (Minn.App.2000), rev’d on other grounds, 623 N.W.2d 604 (Minn.2001), and Carrick v. Carrick, 560 N.W.2d 407 (Minn.App.1997). In each of those cases, we held that the district court had erred by imputing income to a longtime homemaker without a finding of bad-faith underemployment. Maurer, 607 N.W.2d at 181; Carrick, 560 N.W.2d at 410. We reasoned that when a spouse is the homemaker and primary caretaker of the children, imputing income to that spouse without finding bad faith would ignore the spouse’s contributions as a homemaker in the marriage and punish her for maintaining the homemaker lifestyle. Carrick, 560 N.W.2d at 410; see also Maurer, 607 N.W.2d at 181. Here, respondent, not appellant, was the homemaker and primary caretaker of the parties’ child. We also observe that appellant’s financial and professional circumstances are far removed from those addressed in Maurer and Car-rick, where we considered the diminished earning capacities of female homemakers in so-called traditional marriages. Although appellant’s desire to seek remunerative employment may have diminished as a result of the financial support he received from respondent during the marriage, his earning capacity has not. The trial court appropriately imputed income to appellant.

The record does not support appellant’s argument that the trial court impermissi-bly considered his marital misconduct in denying maintenance. The trial court found that the parties frequently failed to communicate, but made no specific finding of fault.

The record is clear that appellant’s combined investment income and employment income will be sufficient to meet his monthly expenses. The trial court carefully considered and thoroughly analyzed all of the factors listed in Minn.Stat. § 518.552, subd. 2, and its determination that appellant is capable of self-support without any contribution from respondent has a reasonable and acceptable basis in fact. Pettit v. Pettit, 472 N.W.2d 668, 671 (Minn.App.1991) (citation omitted).

IV.

Appellant argues that the trial court abused its discretion by dividing the parties’ marital property equally, concluding that appellant suffered no undue hardship warranting an invasion of respondent’s nonmarital assets. We disagree, and affirm the trial court’s conclusion that appellant’s awards of marital and nonmari-tal property, which together exceed $670,000, preclude his claim of hardship,

A trial court can apportion non-marital property if it finds unfair hardship based on all relevant factors including the length of the marriage, the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities, needs, and opportunity for future acquisition of capital assets and income of each party. Minn.Stat. § 518.58, subd. 2 (2000). “A very severe disparity between the parties is required to sustain a finding of unfair hardship necessary to apportion nonmarital property.” Ward v. Ward, 453 N.W.2d 729, 733 (Minn.App.1990), review denied (Minn. June 6, 1990).

Appellant is in good health and possesses marketable skills that, together with his investment income, will enable him to meet his reasonable expenses. Appellant cites no apposite authority to support his argument that he will suffer undue hardship because respondent’s financial circumstances are, and will continue to be, significantly better than his own. Respondent’s superior financial condition is due to her nonmarital holdings in Siegel-Robert. Appellant’s reasonable needs will be met by the trial court’s distribution of marital and nonmarital property. A disparity between the parties’ post-dissolution assets does not support a claim of hardship. The trial court acted well within its discretion in dividing the marital and nonmarital property.

DECISION

The trial court did not err by concluding that (1) the QTIP stock remained respondent’s nonmarital property following the stock-purchase transaction, (2) the Siegel-Robert AAA was respondent’s nonmarital property, (3) appellant was not entitled to spousal maintenance, and (4) appellant suffered no unfair hardship warranting an invasion of respondent’s nonmarital property.

Affirmed.


source: Caselaw Access Project

author: MINGE, Judge.

license: Public Domain

text:
    STATE of Minnesota, Appellant, v. Michelle Marie SMITH, et al., Respondents.
    No. C2-02-204.
    Court of Appeals of Minnesota.
    Oct. 15, 2002.

      Mike Hatch, Attorney General, Steven L. Schleicher, Assistant Attorney General, St. Paul, MN; and Douglas J. Christian, Le Sueur County Attorney, Le Center, MN, for appellant.

      Richard L. Swanson, Thomas A. Volk, Attorneys at Law, Chaska, MN, for respondents.
    Considered and decided by WILLIS, Presiding Judge, MINGE, Judge, and PARKER, Judge.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. Art. VI, § 10.

   OPINION

MINGE, Judge.

In this appeal from a pretrial order suppressing evidence and dismissing charges of first- and fifth-degree eontrolled-sub-stanee crime, child endangerment, and driving without a license, the state argues that the district court erred in ruling that the statute prohibiting excessive automobile window tint, which was the basis for the stop, is unconstitutional. The state also argues that the exclusionary rule should not apply to evidence gathered incident to a stop based on a statute that is later determined to be unconstitutional and that the vehicle owner who was not present at the time of the stop has no standing to contest the stop and search. Because no police misconduct occurred that warrants applying the exclusionary rule for its deterrent effect, we reverse and remand without reaching the constitutional and standing issues.

FACTS

On February 2, 2001, a Le Sueur County deputy stopped respondent Glen Lee Kohman for driving a car with an excessively tinted window. Minn.Stat. § 169.71, subd. 4 (2000). The deputy testified that the car caught his attention because he could not see through its rear window. After making the stop and checking respondent Kohman, the deputy arrested him for driving without a license and impounded the car, which was owned by respondent Michelle Marie Smith. During an inventory search of the car, officers found methamphetamine and evidence of material used to manufacture methamphetamine. Officers secured a warrant to search the car more extensively and found more evidence of drug-manufacturing materials. Officers then secured a search warrant for respondents’ house. This search revealed further evidence of drug manufacturing, and the officers learned that three minors lived with respondents. Respondents were charged with possession, manufacturing, and conspiracy to manufacture methamphetamine, as well as child endangerment. See Minn.Stat. § 152.025, subd. 2(1) (2000) (possession); Minn.Stat. § 152.021, subd. 2a (2000) (manufacturing); Minn.Stat. § 152.096, subd. 1 (2000) (conspiracy); Minn.Stat. § 609.378, subd. 1(b)(2) (2000) (endangerment). Kohman was also charged with driving without a license under Minn.Stat. § 171.24, subd. 5(1) (2000). Charges were not pressed under the tinted-window statute.

On July 17, the district court held a contested omnibus hearing to consider whether officers had probable cause to charge respondents. On October 30, the court ruled that the tinted-window statute violated the equal protection provision of the Minnesota Constitution by permitting people driving vans or pick-up trucks — but not cars — to drive with excessively tinted rear and side windows. See Minn.Stat. § 169.71, subd. 4(3) (2000). The court acknowledged that the officers’ conduct “was reasonable, prudent and arguably lawful at the time of the stop and resulting arrest and searches.” Nevertheless, the court held that, because the stop was based on an unconstitutional statute, all evidence discovered as a result must be suppressed. The court concluded that there was not sufficient evidence to establish probable cause for the arrest, for the warrants, and for the charges and dismissed all charges against respondents. The state moved for a rehearing, clarification, and reconsideration, which the court denied. This appeal followed.

ISSUE

Does the exclusionary rule apply to evidence obtained incident to stopping a vehicle for violating an unconstitutional law when at the time of the stop there was no reason to believe the law might be unconstitutional and there is no allegation of improper conduct by the police?

ANALYSIS

The state challenges the district court’s decision that the tinted-window statute (Minn.Stat. § 169.71, subd 4 (2000)) violates the equal protection provision of the Minnesota Constitution. Because the exclusionary rule exists to deter police misconduct, and because no police misconduct of any kind occurred and no other special circumstances exist in this case, we reverse and remand without reaching the constitutional issue. In view of this determination, we do not address the state’s argument that respondent Smith lacks standing to challenge the stop.

When reviewing a pretrial suppression order, “we may independently review the facts and determine, as a matter of law, whether the district court erred in suppressing * * * the evidence.” State v. Harris, 590 N.W.2d 90, 98 (Minn.1999) (citation omitted). If the state appeals pretrial suppression orders in felony cases, it “must ‘clearly and unequivocally’ show both that the trial court’s order will have a ‘critical impact’ on the state’s ability to prosecute the defendant successfully and that the order constituted error.” State v. Scott, 584 N.W.2d 412, 416 (Minn.1998) (quotation omitted). Critical impact exists where suppressing the evidence destroys the state’s case. State v. Kim, 398 N.W.2d 544, 551 (Minn.1987).

For purposes of this case, we assume, but do not decide, that the statute on excessively tinted automobile window glass violates the Minnesota equal protection provision. The question is whether the resulting search is impermissible under the exclusionary rule.

The courts fashioned the exclusionary rule to deter unconscionable invasions of privacy by law enforcement officials. State v. Conaway, 319 N.W.2d 35, 41 (Minn.1982). If a stop of a person’s vehicle is impermissible or unreasonable, the exclusionary rule may apply. State v. Fiebke, 554 N.W.2d 755, 757 (Minn.App.1996). The court below correctly noted that the rule extends to derivative evidence that is the product of evidence acquired as an indirect result of the unlawful search. Wong Sun v. United States, 371 U.S. 471, 484-85, 83 S.Ct. 407, 415-16, 9 L.Ed.2d 441 (1963). It is a prudential rule, not constitutionally mandated, and thus it should be used only when its deterrent value outweighs its social costs. State v. Martin, 595 N.W.2d 214, 219 (Minn.App.1999), review denied (Minn. Aug. 25, 1999); cf. New York v. Quarles, 467 U.S. 649, 654-56, 104 S.Ct. 2626, 2630-31, 81 L.Ed.2d 550 (1984) (holding that the Miranda warning, which is designed to protect a suspect’s right against compulsory self-incrimination, is not constitutionally mandated and contains exceptions).

The United States Supreme Court considered the exclusionary rule in the context of an arrest based on a statute that was later found unconstitutional in Michigan v. DeFillippo, 443 U.S. 31, 39-40, 99 S.Ct. 2627, 2633, 61 L.Ed.2d 343 (1979). In that case, police received a call that two intoxicated individuals were in an alley; when the officers arrived, they saw a man standing with a woman who was removing her pants. Id. at 33, 99 S.Ct. at 2630. A city ordinance permitted police to question an individual whose behavior gave reasonable cause to warrant further investigation of possible criminal acts, and the ordinance made it illegal for an individual not to identify oneself. Id. When the man accompanying the woman refused to identify himself, he was arrested, and the police found drugs on him. Id. at 34, 99 S.Ct. at 2630. Although the ordinance was later ruled unconstitutional, the Court held that the exclusionary rule is an inappropriate remedy when police discover evidence after an arrest based on a presumptively valid statute. Id. at 40, 99 S.Ct. at 2633.

The district court below distinguished DeFillippo because that case dealt with an arrest based on a statute that was later found unconstitutional, whereas this case dealt with a stop based on a statute that was later found unconstitutional. The court reasoned that, in DeFillippo, the officers would have had a reasonable articu-lable suspicion to stop the defendant despite the fact that the statute was later found unconstitutional. The court pointed out that the standard for a stop is lower than the standard for an amst, and, absent the tinted-window statute in this case, the officer would have had no reason to stop Kohman. The court also reasoned that Minnesota has rejected the good-faith exception to the exclusionary rule and asserted that police misconduct is simply unconstitutional behavior by law enforcement officers. The district court’s distinction between an arrest and a stop is immaterial in the context of a prudential rule such as the exclusionary rule.

We observe that the policy articulated in DeFillippo is equally applicable to the substantive statute that furnishes the basis for the stop in this case.

Police are charged to enforce laws until and unless they are declared unconstitutional. The enactment of a law forecloses speculation by enforcement officers concerning its constitutionality— with the possible exception of a law so grossly and flagrantly unconstitutional that any person of reasonable prudence would be bound to see its flaws. Society would be ill-served if its police officers took it upon themselves to determine which laws are and which laws are not constitutionally entitled to enforcement.

DeFillippo, 443 U.S. at 38, 99 S.Ct. at 2632.

The exclusionary rule was designed to give practical reinforcement to the Fourth Amendment by deterring lawless conduct by government agents. Weeks v. United States, 232 U.S. 383, 392-94, 34 S.Ct. 341, 344-45, 58 L.Ed. 652 (1914). In the instant case, the legislature adopted the law on vehicle glass. Law enforcement officers played no role that brings the risk of their misconduct within the zone of the challenged legislation. In enacting the tinted-window statute, the legislature was not authorizing a warrantless evidence gathering dragnet or some invidious process that may infringe on the right to be free of unreasonable searches or offensive government conduct.

The exclusionary rule is not appropriate when (1) the conduct of the law enforcement officer was reasonable, prudent, and restrained and there is no hint of selective enforcement or discrimination; (2) the legislation in question did not authorize a warrantless search in the gathering of evidence; (3) all parties assumed the statute was valid and enforceable at the time of the stop and the issuance of the warrant; (4) the officer had probable cause to make an arrest during that stop; and (5) the officer obtained a search warrant from a judicial officer. As a result, the evidence discovered following Kohman’s stop and arrest should not have been suppressed.

DECISION

The exclusionary rule does not apply to evidence obtained under the facts in this case. This court does not reach the questions of constitutionality or standing. The determination of the district court is reversed, and the case is remanded for further proceedings.


author: WILLIS, Judge.

text:
    STATE of Minnesota, Respondent, v. Ray Howard KNAEBLE, Appellant.
    No. C8-01-1735.
    Court of Appeals of Minnesota.
    Oct. 29, 2002.

      Mike Hatch, Attorney General, Thomas R. Ragatz, Assistant Attorney General, St. Paul, MN; and John J. Muhar, Itasca County Attorney, Grand Rapids, MN, for respondent.
    John M. Stuart, State Public Defender, Theodora Gaitas, Assistant Public Defender, Minneapolis, MN, for appellant.
    Considered and decided by TOUSSAINT, Chief Judge, WILLIS, Judge, and MINGE, Judge.
   OPINION

WILLIS, Judge.

This appeal is from a conviction of felon in possession of a firearm, in violation of Minn.Stat. § 609.165, subd. lb(a) (2000), and terroristic threats, in violation of Minn.Stat. § 609.713, subd. 1 (2000). Appellant Ray Knaeble challenges the application of the felon-in-possession statute to his conduct and the sufficiency of the evidence to support the terroristic-threats conviction. Because we conclude that the felon-in-possession statute may properly be applied to possession of an inoperable shotgun and that the evidence is sufficient to prove appellant committed terroristic threats, we affirm.

FACTS

On April 23, 2001, two Itasca County deputy sheriffs responded to a call reporting a domestic disturbance at the residence of appellant and his brother, Paul. Deputy Ryan Gunderson testified that Paul Knaeble met them in the driveway and told them that appellant was “busting up the house” and had broken windows and a door. The officers asked if there was a gun in the house, and Paul reported that appellant had a shotgun in the house.

Deputy Gunderson testified that Paul also reported that appellant had “threatened him about chopping his head off’ and that Paul said he felt threatened. Gunder-son testified that after entering the house they saw appellant, who had been in an outbuilding on the property, approach the house. When appellant entered the house, he was upset about a dent in a small gas can, which he blamed on Paul. He threw the gas can at his brother, knocking a baseball cap off Paul’s head, and told him not to wear a hat in the house. Gunderson testified that Deputy Johnson then told appellant that he was under arrest. Appellant, however, picked up an object from the kitchen table and “held it above his head in a threatening-type manner.” Deputy Gunderson thought at first that the object was a knife, although at trial he identified a hammer as the object appellant had grabbed. The two officers responded by drawing their weapons and ordering appellant to drop the hammer.

Deputy Gunderson testified that appellant eventually put the hammer down. When he continued to ignore their stated intent to arrest him, however, the officers grabbed appellant and handcuffed him. Appellant told them they had no right to arrest him or to take his gun. Gunderson testified that appellant said that he had received the shotgun as payment from someone who owed Mm money.

Deputy Robin Johnson testified that when they encountered Paul Knaeble in the driveway, Paul reported that appellant had broken a window on a car, as well as breaking things in the house. Johnson also testified that Paul said appellant had made several oral threats, in particular a threat “to chop his head off.” Johnson testified that Paul appeared to be concerned about it, although not terrified.

Deputy Johnson testified that Paul told him that appellant had a pellet gun and a double-barreled shotgun in the house. Johnson testified that he asked Paul to take him inside the house and show him the shotgun. Paul led him to the gun, which was “leaning against a wall in the hallway,” in plain view of anyone inside the house. After Johnson did a cursory search of the house, which revealed no other weapons, appellant entered, blaming Paul for the gas-can dent and trying to knock Paul’s cap off. At that point, Johnson testified, he told appellant that he was under arrest, and appellant said “something to the effect, like hell I am.”

Paul Knaeble testified that he could not remember whether appellant had threatened him. When confronted with his statement to police, however, Paul conceded that he told police that appellant said he “was going to chop my head off or something like that.” Paul claimed this was said “a little jokingly” and possibly in reference to a statement made at another time.

Before trial, appellant moved to dismiss the felon-in-possession charge on the ground that the shotgun did not qualify as a “firearm” under the felon-in-possession statute because it was an antique and because it was inoperable. The prosecution presented the testimony of a local sporting-goods merchant, who testified that the shotgun had been manufactured sometime between 1880 and 1920 and was inoperable “in a traditional sense” because the hammer springs were broken or had been removed. He testified, however, that the firing pins on the gun were in place and that the gun could be fired if the hammer were manually struck with sufficient force. The store owner also testified that the gun was not an “antique” under federal regulations, and its sale would be subject to the required paperwork and background check for firearm sales.

The district court denied appellant’s motion to dismiss the felon-in-possession charge. The court made detailed factual findings on the age and condition of the shotgun and concluded that a temporarily inoperable gun was a “firearm” for purposes of Minn.Stat. § 609.165, subd. lb(a).

After the jury found appellant guilty on all three counts (including obstruction of legal process), the court sentenced him to concurrent executed sentences of 21 months for the felon-in-possession offense and 21 months for terroristic threats. This appeal follows.

ISSUES

1. Was appellant properly convicted under Minn.Stat. § 609.165, subd. lb(a), based on possession of an inoperable firearm?

2. Does the policy statement in Minn. Stat. § 624.711 preclude conviction for possessing a shotgun?

3. Is the evidence sufficient to support the conviction of terroristic threats?

ANALYSIS

I.

Appellant argues that because he was charged with constructively possessing the shotgun, and not with using it in the course of an offense, he cannot be convicted for possessing a firearm that was inoperable. Appellant acknowledges supreme court caselaw holding that a “firearm” need not be capable of operation for purposes of criminal liability. But he argues that those holdings should be limited to cases involving actual use of the weapon.

The interpretation of a statute is a question of law subject to de novo review. State v. Dendy, 598 N.W.2d 4, 6 (Minn.App.1999), review denied (Minn. Sept. 28, 1999).

Appellant was convicted of violating Minn.Stat. § 609.165, subd. lb(a) (2000), which prohibits the possession of “a firearm” by a person who has been convicted of a crime of violence unless ten years have elapsed since the person’s restoration to civil rights. The statute does not define the term “firearm”; neither does the criminal code provide a general definition. But appellant argues that the term does not extend to an inoperable gun.

The supreme court has held, in a challenge to a conviction of aggravated assault, that

a firearm manufactured as such is a “firearm” even if there is some mechanical defect which renders it temporarily inoperable.

LaMere v. State, 278 N.W.2d 552, 556 (Minn.1979). The court reasoned by analogy from the case of an unloaded gun, which can elicit the same response from a victim as a loaded gun, and which should be treated alike for purposes of criminal liability, in part because of the difficulty in proving later that the gun was loaded. Id. The court concluded that the same considerations “justify treating a firearm as a ‘firearm’ even if it was temporarily inoperable.” Id.

Three years after LaMere, the supreme court again considered the inoperability of a firearm in the context of a criminal statute, this time in a case in which the defendant was charged with possessing a short-barreled shotgun. Gerdes v. State, 319 N.W.2d 710 (Minn.1982). The court again held that the fact that the gun was inoperable was immaterial under the statute. Id. at 712. The court noted the state’s argument that the statute criminalized mere possession of the weapon, without requiring any intent to use it to commit a criminal offense. Id. The court also indicated that possession had been criminalized because of the impact of “merely displaying such a weapon.” Id. Finally, the court found the LaMere holding that an inoperable firearm is a dangerous weapon to be instructive. Id.

Appellant argues that Gerdes is distinguishable because any possession of a short-barreled shotgun is prohibited, whereas in this case appellant’s possession of his standard-length shotgun was illegal only because of his status as a convicted felon. He argues that the dangerousness of a short-barreled shotgun warrants criminalizing the possession of even inoperable short-barreled shotguns, whereas the presumed dangerousness of a convicted felon does not extend to possession of inoperable firearms generally. We disagree.

First, the supreme court had the opportunity to limit the LaMere holding regarding inoperable weapons to the use of those weapons in Gerdes, but it did not do so. Gerdes involved possession, but not use, of a firearm, just as does the charge against appellant. Gerdes, however, concluded that the potential use by display of an inoperable short-barreled shotgun would be sufficiently convincing to justify making the possession of such a weapon a crime. 319 N.W.2d at 712.

Second, the potential use of a firearm by a convicted felon is presumably the concern that ultimately lies behind the statutory prohibition in Minn.Stat. § 609.165, subd. lb(a). Even if the actual use of the firearm is not at issue, its potential use by display is sufficient under Gerdes to extend the statute’s scope to inoperable weapons.

Finally, all statutory prohibitions directed at firearms are presumably based on the dangerousness of those weapons. An inoperable firearm, lacking the same element of danger as an operable weapon, logically could be exempted from all statutory prohibitions. The legislature, however, has not chosen to create such an exemption. This court cannot supply language that the legislature has chosen to omit or neglected to provide. State v. Jones, 587 N.W.2d 854, 856 (Minn.App.1999).

Thus, we conclude that, under LaMere and Gerdes, possession of an inoperable gun does fall within the prohibition of Minn.Stat. § 609.165, subd. lb(a).

II.

Appellant argues that the legislature’s statement of policy in Minn.Stat. § 624.711, which renounces any intent to regulate shotguns, precludes a prosecution of a felon for possessing a shotgun. That statute, which is entitled “Declaration of policy,” states:

It is not the intent of the legislature to regulate shotguns, rifles and other long-guns of the type commonly used for hunting and not defined as pistols or semiautomatic military-style assault weapons, or to place costs of administration upon those citizens who wish to possess or carry pistols or semiautomatic military-style assault weapons lawfully, or to confiscate or otherwise restrict the use of pistols or semiautomatic military-style assault weapons by law-abiding citizens.

Minn.Stat. § 624.711 (2000).

The state argues that appellant has waived any claim that Minn.Stat. § 624.711 bars this prosecution because he failed to raise that issue in the district court. This court generally will not address issues raised for the first time on appeal. State v. Sorenson, 441 N.W.2d 455, 457 (Minn.1989). But we may do so if it is in the interests of justice and does not unfairly surprise the other party. Id. Because the application of section 624.711 does not pose a novel legal issue or involve any fact issue that would benefit by prior consideration by the district court, we will address the issue in the interests of justice.

This court has already held that the statement of policy in Minn.Stat. § 624.711 does not preclude the state from prosecuting a felon for possessing a shotgun. Dendy, 598 N.W.2d at 7. Appellant attempts to distinguish Dendy or to avoid its holding in several ways.

In Dendy, the defendant was charged under Minn.Stat. § 624.713, subd. 1(b) (1998), with possessing a “firearm” after police found a shotgun at his home. Id. at 6. The district court ruled that Minn.Stat. § 624.713, subd. 1(b), did not apply to possession of a shotgun, citing the policy statement in Minn.Stat. § 624.711 regarding the regulation of shotguns. Id. This court acknowledged

a conflict between the policy declaration [in Minn.Stat. § 624.711] that the legislature does not intend to regulate shotguns used for hunting, and the 1994 amendment prohibiting certain persons from possessing pistols, assault weapons, and any other firearm, which is now codified at Minn.Stat. § 624.713. The provisions contradict each other and therefore are irreconcilable.

Id. at 7. The Dendy court resolved the conflict by applying two rules of statutory construction: (1) a later-enacted law prevails over one enacted earlier; and (2) a more specific provision prevails over one that is more general. See id; see generally State ex rel. McMaster v. Benson, 495 N.W.2d 613, 614 (Minn.App.1993) (citing general rule that law last enacted prevails), review denied (Minn. Mar. 11,1993); State v. Lewandowski, 443 N.W.2d 551, 553 (Minn.App.1989) (noting rule that specific statute controls over general statute absent manifest legislative intent to the contrary).

Appellant argues that Dendy is distinguishable because the defendant there was charged under the felon-in-possession provisions of chapter 624, while appellant was charged with violating Minn.Stat. § 609.165, subd. lb(a). But the same rules of statutory construction apply to both statutes. And section 609.165, subd. lb(a), which governs eligibility to possess firearms following a felon’s restoration to civil rights, is even more specific than the general felon-in-possession prohibition in Minn.Stat. § 624.713, subd. 1(b). Moreover, Minn.Stat. § 609.165 has been amended several times since the 1975 enactment of Minn.Stat. § 624.711 and also since the minor 1993 amendment to section 624.711. See 1994 Minn. Laws ch. 636, art. 3, § 9 (adding subd. lb to section 609.165); 1993 Minn. Laws ch. 326, art. 1, § 22 (adding reference to semi-automatic military assault weapons to section 624.711). Thus, the same reasoning applied in Den-dy to a chapter 624 felon-in-possession prosecution applies to appellant’s prosecution under Minn.Stat. § 609.165, subd. lb(a).

Appellant also argues that the dissenting opinion in State v. Wasson, 615 N.W.2d 316 (Minn.2000), requires a result different from Dendy. But Wasson involved a challenge to a no-knock provision in a search warrant. Id. at 318. In a footnote, Justice Gilbert, who disagreed with the majority’s conclusion that there were grounds for a no-knock entry, indicated that Minn. Stat. § 624.711 specifically exempts certain weapons “from the ‘felon in possession’ bar to owning weapons.” Id. at 327 n. 2. This statement, in a separate opinion, not representing the ruling of the court as a whole, on a matter tangential to the disputed issue in the case, does not overrule Dendy. See generally State ex rel. Foster v. Naftalin, 246 Minn. 181, 208-09, 74 N.W.2d 249, 266 (1956) (explaining when dictum in “a court’s opinion” is entitled to deference).

III.

Finally, appellant argues that the evidence presented at trial was insufficient to support his conviction for uttering ter-roristic threats. In reviewing a claim of insufficient evidence, this court conducts a painstaking analysis of the record to determine whether the evidence, when viewed in the light most favorable to the conviction, is sufficient to allow the jurors to reach the verdict that they did. State v. Webb, 440 N.W.2d 426, 430 (Minn.1989). The reviewing court must assume the jury believed the state’s witnesses and disbelieved any evidence to the contrary. State v. Moore, 438 N.W.2d 101, 108 (Minn.1989).

Appellant argues that his brother Paul’s testimony at trial was too vague to establish that appellant threatened to “chop his head off’ or that the statement, if made, would have had a reasonable tendency to create apprehension that it would be carried out. See Minn.Stat. § 609.713, subd. 1 (2000) (prohibiting threats made with purpose of terrorizing another or in reckless disregard of risk of causing such terror); see generally State v. Murphy, 545 N.W.2d 909, 915 (Minn.1996) (discussing elements of terroristic threats in context of claim that physical acts alone could not constitute terroristic threats).

But Paul Knaeble did not deny that appellant threatened him, he merely claimed confusion and lack of precise memory as to the threat. The state presented the testimony of two officers that Paul told them that appellant had threatened to “chop his head off.” In light of this evidence, along with Paul Knaeble’s failure to deny at trial that appellant made the statements or to deny that he felt threatened, there is no lack of proof that the threat was made. Cf. State v. Lehikoinen, 463 N.W.2d 770, 772 (Minn.App.1990) (holding that recanting victim’s admission that she told police of the assault, without police testimony about her statement, was insufficient evidence to support conviction).

Appellant’s argument that his statement to his brother that he would “chop his head off’ was not a terroristic threat is without merit. Although a person may flippantly or thoughtlessly say to another that he is going to “chop his head off,” appellant had been breaking windows and otherwise acting in a violent manner before making the statement and was still visibly upset 40 minutes later when the police arrived, trying to knock his brother’s cap off and acting belligerently with the police. These circumstances establish that appellant’s words were not merely flippant or spoken in jest. Therefore, we conclude that the evidence is sufficient to support the conviction.

DECISION

Appellant’s possession of an inoperable shotgun fits within the statutory prohibition in Minn.Stat. § 609.165, subd. lb(a). And a prosecution for that offense is not barred by Minn.Stat. § 624.711. Finally, the evidence is sufficient to support the conviction of terroristic threats.

Affirmed.


author: PETERSON, Judge. G. BARRY ANDERSON, Judge

text:
    Thomas A. REGNER, Appellant, v. NORTHWEST AIRLINES, INC., Respondent.
    No. C4-02-463.
    Court of Appeals of Minnesota.
    Nov. 5, 2002.

      Susan M. Coler, Sprenger & Lang, PLLC, Minneapolis, MN, for appellant.
    Timothy R. Thornton, Scott G. Knudson, Susan E. Ryan, Briggs and Morgan, P.A., Minneapolis, MN, for respondent.
    Considered and decided by G. BARRY ANDERSON, Presiding Judge, PETERSON, Judge, and HUDSON, Judge.
   OPINION

PETERSON, Judge.

Appellant Thomas A. Regner, an airline mechanic employed by respondent Northwest Airlines, Inc., was fired after he filed reports of alleged safety violations with the Federal Aviation Administration. Regner sued under the Whistleblower Act, Minn.Stat. § 181.932, subd. 1(a), contending that he was fired for making the reports. In this appeal from a summary judgment for Northwest, Regner challenges the district court’s conclusion that under the Airline Deregulation Act, 49 U.S.C. § 41713, Congress intended to preempt state whistleblower claims when an employee reports a violation or suspected violation of a Federal Aviation Administration safety regulation. We affirm.

FACTS

Northwest hired Regner as an aircraft mechanic in August 1989 and promoted him to the position of crew chief in 1996. As a crew chief, Regner was responsible for assigning maintenance and repair work to crew members and making sure that the maintenance and repair work and required paperwork were properly completed.

Under federal safety regulations, an aircraft used to carry passengers must have an airworthiness certificate in effect. 49 U.S.C. § 44711(a)(1). When a nonroutine repair was required on a Northwest aircraft, a mechanic or crew chief wrote up a card stating what work was required. Before the aircraft could be returned to service, the repair either had to be completed or, if the repair was not related to airworthiness, it could be deferred. Completion or deferral of a repair was indicated on the card.

Federal aviation regulations also require aircraft mechanics to report safety violations to the Federal Aviation Administration. On five occasions between March and April 1998, Regner reported possible safety violations by Northwest to the Federal Aviation Administration. A factual dispute exists regarding whether Regner made the reports in good faith or as part of an orchestrated work slowdown. Northwest discharged Regner from employment on May 5, 1998, and Regner brought this action claiming that he was fired for reporting the safety violations. The district court concluded that Regner’s claim is preempted by the Airline Deregulation Act (ADA) and granted summary judgment for Northwest.

ISSUE

Is Regner’s whistleblower claim brought under Minn.Stat. § 181.932, subd. 1(a) preempted by the ADA?

ANALYSIS

‘Whether a claim is preempted is a question of congressional intent that is ‘at bottom’ a legal question of statutory construction.” Leonard v. Northwest Airlines, Inc., 605 N.W.2d 425, 428 (Minn.App.2000). Statutory construction is subject to de novo review. Metropolitan Sports Facilities Comm’n v. County of Hennepin, 561 N.W.2d 513, 515 (Minn.1997).

Preemption analysis begins with the assumption that the “historic police powers of the [s]tates” are not to be eclipsed unless to do so was “the clear and manifest purpose of Congress.”

Dahl v. Charles Schwab & Co., 545 N.W.2d 918, 922 (Minn.1996) (quoting Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 1152, 91 L.Ed. 1447 (1947)). When determining the preemptive effect of the ADA,

our ultimate touchstone is the purpose of Congress. We begin with the language employed by Congress and the assumption that the ordinary meaning of that language accurately expresses the legislative purpose. We do not lightly infer pre-emption in the area of employment law, for it falls within the traditional police power of the State.

Botz v. Omni Air Int’l, 286 F.3d 488, 492-93 (8th Cir.2002) (quotations and citations omitted).

The FAA [Federal Aviation Act] was passed by Congress for the purpose of centralizing in a single authority the power to frame rules for the safe and efficient use of the nation’s airspace. To that end, Congress set out a legal duty, enforceable by the Secretary of Transportation, that interstate air carriers perform their services “with the highest possible degree of safety * *

Botz v. Omni Air Int’l, 134 F.Supp.2d 1042, 1047 (D.Minn.2001) (quoting 49 U.S.C. § 44701(d)(1)(A)) (other quotation omitted), aff'd, 286 F.3d 488 (8th Cir.2002). The FAA was amended by the ADA in 1978, 49 U.S.C. 41713 (1995).

The enactment [of the ADA] was motivated by congressional belief that maximum reliance on competitive market forces would best further efficiency, innovation, and low prices as well as variety and quality of ah- transportation services.

Leonard, 605 N.W.2d at 429 (quotation omitted).

The ADA contains the following preemption provision:

[A] State * * * may not enact or enforce a law, regulation, or other provF sion having the force and effect of law related to a price, route, or service of an air carrier * * *.

49 U.S.C. § 41713(b)(1); see Leonard, 605 N.W.2d at 429 (purpose of preemption provision is to prevent states from undoing deregulation).

The United States Supreme Court has set forth a two-part test for determining whether the ADA preempts a state claim. Leonard, 605 N.W.2d at 429 (citing American Airlines v. Wolens, 513 U.S. 219, 226, 115 S.Ct. 817, 823, 130 L.Ed.2d 715 (1995); Morales v. Trans World Airlines, Inc., 504 U.S. 374, 384, 112 S.Ct. 2031, 2037, 119 L.Ed.2d 157 (1992)). “To be preempted, the claim must (1) relate to prices, routes, or services, and (2) constitute an enactment or enforcement of state law.” Id. (citing Wolens, 513 U.S. at 226, 115 S.Ct. at 823). Because this lawsuit arises under the Whistleblower Act, the second prong is satisfied. See id. at 431 (distinguishing between contract claims that seek simply to enforce the bargain of the parties and those that require the enforcement of state law or policy outside the contract). Thus, the question is whether this lawsuit relates to prices, routes, or services.

The Minnesota Whistleblower Act states:

An employer shall not discharge, discipline, threaten, otherwise discriminate against, or penalize an employee regarding the employee’s compensation, terms, conditions, location, or privileges of employment because:
(a) the employee, or a person acting on behalf of an employee, in good faith, reports a violation or suspected violation of any federal or state law or rule adopted pursuant to law to an employer or to any governmental body or law enforcement official;
(b) the employee is requested by a public body or office to participate in an investigation, hearing, inquiry;
(c) the employee refuses an employer’s order to perform an action that the employee has an objective basis in fact to believe violates any state or federal law or rule or regulation adopted pursuant to law, and the employee informs the employer that the order is being refused for that reason; or
(d) the employee, in good faith, reports a situation in which the quality of health care services provided by a health care facility, organization, or health care provider violates a standard established by federal or state law or a professionally recognized national clinical or ethical standard and potentially places the public at risk of harm.

Minn.Stat. § 181.932, subd. 1 (Supp.1997).

In Botz, the federal district court summarized the Supreme Court’s decisions in Wolens and Morales as follows:

The [Morales] Court stated that the ordinary meaning of the phrase “related to” is broadly defined as “to stand in some relation; to have bearing or concern; to pertain; refer; to bring into association with or connection with.” The question before the Court in Morales was whether the enforcement of state law, prohibiting deceptive advertising by airlines, was “related to” airline rates, and within the preemptive scope of § 41713(b)(1). The Court found that the state law was sufficiently related to airline’s rates to fall within the scope of the FAA’s preemption, reasoning that restrictions on the advertising of airline rates would serve to increase the difficulty of discovering the lowest cost seller and reduce the incentive to price competitively. The Supreme Court, therefore, applied a very broad reading of the term “related to.”
The Supreme Court also addressed the breadth of the FAA’s preemption in [Wolens ]. In Wolens, the Court held that the FAA preempted the plaintiffs state Consumer Fraud Act claims, but did not preempt plaintiffs common-law contract claims. With respect to the plaintiffs Consumer Fraud Act claims, the Court relied on its holding in Morales to find that the Act was preempted. The Court reasoned that applying the Act to airlines amounted to a policing of the marketing practices of the airlines. Accordingly, the Court held that the Act was related to the airline’s services. The Court declined, however, to apply FAA preemption to plaintiffs breach of contract claim because the claim did not arise from a state-imposed obligation, as required for FAA preemption. Under Morales and Wolens, the term “related to a service” and the scope of FAA preemption are to be interpreted broadly by this Court.

Botz, 134 F.Supp.2d at 1045-46.

In Botz, the Eighth Circuit Court of Appeals, based on the plain language of the ADA’s preemption provision and on Morales and Wolens, held that the ADA preempted a flight attendant’s claim under the Minnesota Whistleblower Act. Botz v. Omni Air Intern., 286 F.3d 488, 498 (8th Cir.2002). The flight attendant was terminated after she refused to accept an assignment that she believed violated regulations governing the maximum hours a flight attendant can fly in a specified time period. Botz, 286 F.3d at 490. The Eighth Circuit court explained:

■When applied to the facts surrounding Botz’s discharge, the Minnesota whistleblower statute has a forbidden connection with air-carrier services. It includes broad authorization to flight attendants to refuse assignments, jeopardizing an air carrier’s ability to complete its scheduled flights. The FAR [Federal Aviation Regulations] set standards for the minimum number of flight attendants that must be on board and available to serve passengers and execute safety procedures. Thus, an air carrier is unauthorized to fly or even board passengers if an aircraft’s crew does not include the proper number of flight attendants. An air carrier that is confronted with a flight attendant’s refusal to serve on a flight to which he has been assigned has at least two obvious options for dealing with the scheduled flight. It can replace the refusing flight attendant with another flight attendant it employs, or, if it is unable to replace him in time, it can cancel the flight to comply with the FAR prescriptions of the minimum number of flight attendants and reschedule the ticketed passengers onto other flights.
* * * [A] significant likelihood exists that the carrier will have to cancel the flight in order to comply with the FAR’s flight-attendant staffing regulations. * * * An air carrier cannot avoid this possibility even by adhering to every law, rule, and regulation- — federal and state, for the Minnesota whistleblower statute authorizes refusals based on the flight attendant’s objective, fact-based belief alone that the assignment is viola-tive. This authorization to refuse assignments, and the protections that the whistleblower statute provides, have a forbidden connection with an air carrier’s service under any reasonable interpretation of Congress’s use of the word “service.”

Id. at 494-95; see also Hodges v. Delta Airlines, Inc., 44 F.3d 384, 336 (5th Cir.1995) (holding that “services” refers to elements of “the contractual arrangement between the airline and the user of the service,” including “items such as ticketing, boarding procedures, provision of food and drink, and baggage handling, in addition to the transportation itself’).

Regner argues that this case is distinguishable from Botz because he brought his claim under Minn.Stat. § 181.932, subd. 1(a), not Minn.Stat. § 181.932, subd. 1(c). But the Botz plaintiff sued under both subsections (a) and (c). Id. at 490. In any event, Regner’s argument that a distinction should be made between subsections (a) and (c) for the purpose of preemption is not persuasive. We conclude that just as a flight attendant can interrupt services by refusing an assignment, an aircraft mechanic can interrupt services by grounding an aircraft based on an alleged mechanical violation.

We recognize that the ADA was amended after Regner initiated this lawsuit and before the Botz plaintiff initiated hers. In 2000, Congress amended the ADA by adding a section establishing a comprehensive scheme for aggrieved employees to bring whistleblower claims. Botz, 134 F.Supp.2d at 1048. Before the enactment of the ADA’s whistleblower provision, there was a split among authorities, with some jurisdictions holding that the ADA did not preempt state retaliatory-discharge claims and others holding that it did. See, e.g., Espinosa v. Continental Airlines, 80 F.Supp.2d 297 (D.N.J.2000) (holding that FAA did not completely preempt state retaliation claim); Marlow v. AMR Serv. Corp., 870 F.Supp. 295 (D.Haw.1994) (holding that state whistleblower claim was preempted by the FAA).

The Eighth Circuit’s decision in Botz, however, was based strictly on the ADA preemption provision’s plain language and the Supreme Court’s construction of the term “related to”. The Eighth Circuit stated:

[I]n accordance with the ADA pre-emption provision’s plain language and the Supreme Court’s instruction that the provision’s “related to” language should be broadly applied, we conclude that the Minnesota whistleblower statute has a forbidden connection with both air-carrier routes and services.

Botz, 286 F.3d at 496-97. Only after stating its holding did the court note that its decision was bolstered by the addition of the whistleblower provision to the ADA. Id. at 497.

Regner cites the FAA’s savings clause as support for his argument against preemption. The savings clause states, “[a] remedy under this part is in addition to any other remedies provided by law.” 49 U.S.C. 40120(c) (1994). Regner argues that this provision “confirms that Congress contemplated the survival of state law remedies that did not interfere with the ADA’s purpose.” But “[t]he Supreme Court has referred to this as a general ‘remedies’ savings clause and deemed it “a relic of the pre-ADA/no pre-emption regime.’ ” Botz, 286 F.3d at 491 (quoting Morales v. Trans World Airlines, Inc., 504 U.S. 374, 385, 112 S.Ct. 2031, 119 L.Ed.2d 157 (1992)).

While this court is not bound to follow Eighth Circuit precedent, it is persuasive authority. Northpointe Plaza v. City of Rochester, 457 N.W.2d 398, 403 (Minn.App.1990), aff'd, 465 N.W.2d 686 (Minn.1991). Because we are persuaded by the Eighth-Circuit’s well-reasoned decision in Botz, we hold that the ADA preempts Regner’s whistleblower claim.

Having concluded that the ADA preempts Regner’s whistleblower claim, we do not reach Northwest’s argument that Regner’s claim is preempted by the Railway Labor Act.

DECISION

Because Regner’s whistleblower claim brought under Minn.Stat. § 181.932, subd. 1(a), relates to a price, route, or service of an air carrier and constitutes enforcement of a state law, the claim is preempted by 49 U.S.C. § 41713(b)(1).

Affirmed.

G. BARRY ANDERSON, Judge concurring specially.

G. BARRY ANDERSON, Judge

(concurring specially).

I concur with the majority and agree with the conclusion that appellant’s state whistleblower claim is preempted by the federal Airline Deregulation Act. I write separately, however, to express my concerns with respondent’s use of the record and ad hominem arguments.

Respondent’s brief is replete with extreme factual assertions relating to appellant’s alleged participation in a mechanics’ work slowdown. For example, respondent alleges that, prior to appellant’s termination from employment, appellant “attempted to shield himself from slowdown accountability by reporting alleged maintenance irregularities to the airline and the FAA.” Respondent also alleges that although appellant’s conduct “did not result in flight cancellation, the purpose of [appellant’s] conduct — the disruption of air carrier service — is beyond cavil.” Finally, respondent alleges that appellant “was attempting to put half of the aircraft that [respondent] operated on the ground. [Appellant] arrogated on to himself command over a fleet of 180 aircraft. He would say when those DC-9s would fly.”

While appellant’s participation in the alleged “slowdown” can arguably be inferred from the circumstances, respondent fails to cite to any part of the record supporting these specific allegations. Parties before this court have an obligation under the rules of civil appellate procedure to cite to the specific part of the record that supports each factual assertion. Minn. R. Civ. App. 128.03

Although respondent argues otherwise, the record indicates that the FAA and respondent took some action to ameliorate certain “unairworthy” conditions identified by appellant as posing safety risks to respondent’s aircraft. For instance, the FAA responded to appellant’s complaint about the use of certain fire-containment tape by issuing a “technical alert,” and, in response to appellant’s complaint concerning the charging of emergency-light battery packs, respondent amended its Boeing 727 maintenance manual and revised a chapter of its general engineering and maintenance manual. Because respondent took these steps, the FAA did not take further enforcement action “pursuant to [respondent’s] commitment to the proposed actions.” These corrective actions may have been relatively minor, but there seems to be no dispute that they were in response to appellant’s complaints.

I turn next to respondent’s ad hominem and irrelevant arguments against appellant and appellant’s counsel. Respondent claims, among other things, that “maintenance disruption is a time-honored collective bargaining stratagem among [respondent’s] unionized mechanics.” Further, respondent states that appellant “apparently has difficulty understanding appellate court opinions.” Both arguments are examples of non-sequiturs — fallacies of irrelevance. The circumstances surrounding appellant’s complaints are not relevant to the issues in this case and respondent’s use of appellant’s union membership, and union conduct in general, to impugn appellant’s legal argument is simply wrong.

There is little doubt that respondent was benefited here by competent, effective and aggressive advocacy. Although not directly related to the disposition of this case, because I have concerns with the form and expression of that advocacy, I concur specially.

      . The personal attack, or argument ad homi-nem (Latin for "against the person"), attempts to undercut a claim by drawing unfavorable attention to the person making it. * * * An opponent's thesis is asserted to be wrong or unworthy of attention because of the opponent's character or situation. Such reasoning is fallacious because it does not address the truth or falsity of the proposition itself.
      Robert Paul Churchill, Logic: An Introduction 465 (2d ed. 1990).
      It is of course a matter of historical record and beyond dispute that labor unions have engaged in "slowdown” tactics or have engaged in other conduct determined to be wrongful. United Air Lines, Inc. v. Int’l Assoc. of Machinists and Aerospace Workers, 243 F.3d 349, (7th Cir.2001) (stating that the issu-anee of an injunction in favor of the airline was appropriate based on proof that IAM participated in, authorized, or ratified work slowdowns by some of its union members). And it is equally a matter of historical record and beyond dispute that employers have engaged in tactics or conduct determined to be wrongful. Advanced Constr. Services, Inc. v. N.L.R.B., 247 F.3d 807 (8th Cir.2001) (holding that an employer was found to have violated its duty to bargain lawfully by refusing to provide information to the local union affiliate).
      But it is not necessary to resolve whether management or labor is on the side of the angels. As interesting as that philosophical question is, it is irrelevant to the only question at hand here — does preemption apply?