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News NJ App. Div Interprets &quot;Control Of Affliliate&quot; In Deemer Statute. August 30, 2010 < Back Share to: In Cupido v. Perez, the plaintiff was a resident of Pa. involved in a motor vehicle accident in NJ. Plaintiff selected the full tort option under his personal automobile insurance policy giving him the right to sue for any injuries sustained in a motor vehicle accident. Plaintiff's carrier, Nationwide, was not authorized to transact any motor vehicle insurance business in NJ; however, it controlled 4 affiliated companies which were authorized to transact commercial motor vehicle insurance but not private passenger insurance business in NJ. The issue on appeal was whether the NJ Deemer Statute , N.J.S.A. 17 :28-1.4 applied based on the control of an affiliate company authorized to transact commercial motor vehicle insurance business in NJ. The Appellate Division found that the Deemer Statute applied, and therefore that the plaintiff was subject to the NJ verbal threshold limitations on his right to sue for injuries. Please contact Robert Ball with any questions. http://www.judiciary.state.nj.us/opinions/a4557-08.pdf Previous Next Contact

News Clever Defense Strategy Leads to Victory for Motor Vehicle Insurer (NJ) March 12, 2020 < Back Share to: It is common practice for a defendant in a personal injury action to retain a doctor to conduct an independent medical exam (“IME”) of the plaintiff, with the intention of refuting the findings of the plaintiff’s medical expert. Often, but not always, the defense report is favorable and the IME doctor will be called by the defense to testify at trial. In Slomkowski v. New Jersey Manufacturers Insurance Company, the appellate division in New Jersey recently held that the defendant’s decision against calling its IME doctor as a trial witness did not take away from a fair trial for the plaintiffs. The plaintiffs' car was rear ended by a vehicle operated by an underinsured motorist. The plaintiffs sued New Jersey Manufacturers Insurance Co. seeking recovery for personal injuries. The expert hired by the defense determined that the injuries had been caused by the underinsured motorist and rendered a report to that effect, essentially agreeing with the plaintiffs' medical expert. Based on the opinion, the defense decided not to call the IME doctor to testify at the trial. Prior to trial, the defense filed a carefully crafted motion to preclude the plaintiff’s counsel from advising the jury during summation that the defense doctor had been retained by the defendant. Defense counsel did not seek to bar the jury being informed that the defense did not put forth an expert to rebut the plaintiff’s medical expert, nor did the defense object to the plaintiff calling the the defense doctor during their case in chief. The motion was granted and the jury rendered a no cause verdict in the defendant’s favor. On appeal, the court evaluated “whether failure to call a witness raises an unfavorable inference and whether any reference in the summation or a charge [to the jury] is warranted.” In affirming the trial court’s ruling prohibiting the plaintiff’s counsel from advising the jury that an expert was retained by the defense, the court noted that attorneys are given “broad latitude in summation.” However, as the court highlighted, the latitude is not limitless and must be based on facts within the record, which in this case, did not include the defense doctor's testimony. The court further determined that in order to support the plaintiff’s desired inference that the defense was attempting to conceal the opinion (which concurred with the plaintiff’s doctor), the defense would have had to have been in exclusive control of the doctor. Here, the defense was not in exclusive control as it did not call the expert as a defense witness and did not seek to preclude plaintiffs' counsel from doing so.. The court highlighted the fact that the plaintiff was free to subpoena the defense expert's testimony, but did not. In affirming the trial court’s decision, the appellate court determined that the trial court did not abuse its discretion in preventing the plaintiffs' counsel from suggesting to the jury that the defense “had chosen to withhold unfavorable evidence from them,” particularly where the plaintiff had every opportunity to obtain the desired testimony. The strategy does not end with a bad report. Experienced litigators can find a way. Thanks to Emily Kidder for her contribution to this post. If you have any questions or comments, please contact Vincent Terrasi. Previous Next Contact

News Jurisdictional Discovery Has Limits March 6, 2024 < Back Share to: Earlier this week, the Superior Court of New Jersey’s Appellate Division resolved a jurisdictional discovery dispute in a products liability action involving an alleged vape explosion. Plaintiff Ian Crespi (“Crespi”) claims that in 2016 he was injured when his vape exploded. After filing suit against several defendants Crespi filed a Third Amended Complaint against LG Chem, a South Korean company that designs, manufactures and sells an 18650 lithium-ion battery. Following a round of motion practice that included an appeal to the Superior Court, the parties were instructed to conduct jurisdictional discovery, as LG Chem argued the trial court lacked specific personal jurisdiction. Crespi issued 101 interrogatories to LG Chem, which led to further motion practice. Eventually, the Superior Court was asked to determine whether Crespi was entitled to answers or supplemental answers to 22 interrogatories. Citing U.S. Supreme Court precedent, the Court noted that placing a product into the stream of commerce, without more, does not amount to a purposeful act directed towards the forum state that would be sufficient to establish specific personal jurisdiction. Asahi Metal Indus. Co. v. Superior Ct. , 480 U.S. 102, 112 (1987). To that end, jurisdictional discovery should be limited. And where the issue is whether the court has specific personal jurisdiction, such discovery should be limited to “developing facts showing whether defendant engaged in purposeful conduct in New Jersey related to plaintiff's claims.” This is distinguished from the broad focus of merits discovery. The Court found Crespi’s jurisdictional theory as overly broad and indicated it must be tailored. To that end, the Court found that only one of the 22 interrogatories was proper. This interrogatory asked LG Chem to list ways it “recycles, re-purposes, brands, names, uses, sells, ships, and/or distributes [18650 batteries] that do not satisfy [its] requirements for the rechargeable lithium[-]ion battery to be supplied to the [c]onsumer by LG Chem.” (Emphasis omitted). Crespi v. Zeppy, et al. , No. A-2881-22, 2024 WL 1295798, at *3 (N.J. Super. Ct. App. Div. Mar. 27, 2024). Crespi had requested a follow up answer to LG Chem’s response, which the Court found was proper. 18 of the remaining 21 interrogatories concerned details of battery production “from start to finish,” which the Court stated had nothing to do with jurisdictional discovery. The Court also found that Crespi was not entitled to supplemental answers on two interrogatories concerning the sale or advertisement of products in New Jersey between 2011 and 2016, nor was he entitled to an answer as to what steps LG Chem took to ensure other entitled did not distribute or sell its 18650 batteries in New Jersey. As for these last three interrogatories, the Court found LG’s answers and objection satisfied the scope of jurisdictional discovery. This case serves as a helpful reminder that while discovery is a broad concept generally, parties must be mindful that jurisdictional discovery is limited and should not be used as a “fishing expedition” or as an extension of merit discovery. IAN CRESPI v. VAPE ZEPPY MICHAEL EILYUK EDWARD VINOKUR SOCIALITE E-CIGS LLC .pdf Download PDF • 152KB Previous Next Brian T. Noel Brian T. Noel Partner +1 267 331 3891 bnoel@wcmlaw.com Contact

News WCM Obtains Dismissal of NJ Products Liability Lawsuit. July 17, 2020 < Back Share to: Partner Bob Cosgrove and Counsel Matt Care successfully obtained a with prejudice dismissal of a products liability lawsuit in federal court in Newark, New Jersey. In the case of Elizabeth Kean, et al. v. Cedar Works, et al., the plaintiff alleged that, when she was a child, she fell from a defective swing set in her backyard onto her head. She claimed that the fall caused a traumatic brain injury -- specifically trauma-induced postural orthostatic tachycardia syndrome ( “POTS ”). While designed by our client, the swing set was installed, uninstalled, moved, and eventually reinstalled by an unknown party that was not joined to the case. At the close of pleadings, we moved to dismiss the case and argued that the unknown installer, mover, and reinstaller was a necessary and indispensable parties to the litigation, without which full and complete justice could not be rendered. We also moved to dismiss the case on the grounds that complaint was insufficiently specific. The Court granted our motion on both grounds and dismissed all claims against our client. For more information about this victory, please contact rcosgrove@wcmlaw.com .   Previous Next Contact

News Pennsylvania Court Allows For Partial Bifurcation of Bad Faith Claims March 22, 2018 < Back Share to: In Fertig v. Kelley, et al., the plaintiff was injured in a motor vehicle accident. The plaintiff sued the driver of the other car, and her insurance company. The plaintiff claimed that the insurer failed to pay underinsured motorist benefits under her policy. As such, she asserted claims for breach of contract, and statutory bad faith. The insurer moved to bifurcate or sever the bad faith claim, and stay discovery of the bad faith claim until the UIM claim was tried. The Pennsylvania Court of Common Pleas noted that no appellate court in Pennsylvania “has addressed the severance of a UIM claim and a statutory bad faith claim or the stay of bad faith discovery and proceedings pending the resolution of the UIM claim.” With regard to the plaintiff’s liability claims (against the driver) and UIM claim (a/k/a breach of contract claim against the insurer), the court concluded that since those claims raised similar questions of fact and law, they should be joined for trial purposes. Conversely, the court determined, that if the plaintiff’s claim for bad faith was tried with her liability and UIM claims, it could result in unfair prejudice to the insurer. Therefore, the bad faith claim was bifurcated and to be tried after the liability and UIM claims. However, given the similar issues raised in all claims, the court held that all claims should remain consolidated for discovery. Often times a plaintiff will commence an action asserting claims against both the tortfeasor, and an insurance company. Typically, when bad faith claims are involved, a motion to bifurcate is filed, to ensure that the insurance company is not prejudiced by that claim at trial. This case provides guidance on how Pennsylvania courts faced with similar motions will rule, allowing insurers to know how to best defend themselves against bad faith claims. Thanks to Colleen Hayes for her contribution to this post.       Previous Next Contact

News NY’s “Pothole Law,” Prior Written Notice Statutes, and the Affirmative Negligence Exception (NY) December 23, 2020 < Back Share to: In Martin v. City of New York, No. 12318, 2020 WL 7347089 (1st Dep’t, Dec. 15, 2020), the Appellate Division, First Department clarified a municipality’s liability exposure, pursuant to a prior written notice statute and the affirmative negligence exception. In Martin, Plaintiff alleged he sustained personal injuries when falling on a roadway in the Bronx. Defendant owned and maintained the accident location. Defendant moved for summary judgment, which was granted, because Plaintiff failed to provide Defendant with prior written notice of the alleged roadway defect, as required under the “Pothole Law.” See Administrative Code of City of NY § 7-201 (c)(2). On appeal, Plaintiff argued notice was not required under the Pothole Law when the alleged tortfeasor created the roadway defect through an affirmative act of negligence, i.e., poorly conducted repair work. The First Department agreed with Plaintiff and reversed the trial court’s summary judgment order, for the reasons articulated below. Generally, a municipality that has enacted a prior written notice statute may not be subject to liability for personal injuries caused by a defective street or sidewalk condition, absent proof of prior written notice or an exception thereto. Martin, at *1. The Court of Appeals has recognized two exceptions to this rule, namely, where the locality created the defect or hazard through an affirmative act of negligence [and] where a “special use” confers a special benefit upon the locality. Katasoudas v. City of New York, 29 A.D.3d 740, 741 (2d Dep’t 2006) (additional citations omitted). In Martin, the “affirmative creation exception” was at issue. This exception is “limited to work by the City that immediately results in the existence of a dangerous condition.” Yarborough v. City of New York, 10 N.Y.3d 726, 728 (2008) (internal quotation marks and additional citations omitted). The exception does not apply in circumstances where a dangerous condition eventually emerges, due to erosion/gradual wear and tear. In Martin, however, the First Department noted the trial court erred by ignoring deposition testimony demonstrating Defendant attempted to repair the subject road approximately one month before the accident occurred. Thus, questions of fact existed as to whether Defendant’s affirmative repair of the road negligently created a defective condition. The takeaway for defense counsel is that they should be aware of the evidentiary burden required to prevail on summary judgment when plaintiffs proffer testimony supporting the affirmative negligence exception of a prior written notice statute. Rebutting such a proffer would require countervailing evidence that plaintiff’s testimony is either entirely unsubstantiated or the dangerous condition developed over time. Thanks to John Amato for his contribution to this post. If you have any questions or comments, please contact Colleen Hayes. Previous Next Contact

News NY High Court Takes Common Sense Approach to Additional Insured Coverage June 15, 2017 < Back Share to: For years parties have disputed just how far “caused in whole or in part” stretches in the context of coverage afforded an additional insured for the acts or omissions of a named insured. New York’s highest court settled the dispute and decreed “caused” refers to proximate, rather than the impermissibly broad “but for,” causation. The Court of Appeals decided Burlington Ins. Co. v. NYC Tr. Auth., on June 6, 2017, and was presented with a familiar fact pattern in the world of coverage: a coverage dispute over the scope of additional insured coverage afforded in the scope of construction project. Burlington insured Breaking Solutions, Inc. (“BSI”), which supplied equipment and personnel for the project. Plaintiff, a Transit Authority employee, fell from scaffolding after BSI equipment came into contact with a live electrical cable that was under concrete. Burlington initially recognized a duty to defend the Transit Authority, subject to a reservation of rights, based on the Transit Authority’s status as an additional insured. Burlington reserved its right to deny coverage based on the limitations of the pertinent additional insured endorsements, which afforded coverage: …only with respect to liability for “bodily injury”, “property damage” or “personal and advertising injury cause, in whole or in part, by: Your acts or omissions; orThe acts or omissions of those acting on your behalf. Subsequent discovery revealed internal Transit Authority memos admitting they were solely at fault, and BSI neither operated the machinery improperly, nor knew of the existence of the cable. Based on these admissions, Burlington disclaimed coverage. The Court of Appeals held the plain language of the endorsement, including the reference to “liability,” calls for proximate causation. Significantly, the Court rejected the argument that “caused by” is equivalent to “arising out of,” the latter of which signals but for causation. In the end, the Transit Authority’s sole negligence was not covered under the Burlington policy’s additional insured endorsement. The Court’s plain language interpretation reflects the common sense recognition that additional insured endorsements are meant to apportion loss to the party with the most control over the risk. In the real world construction context, the endorsement is meant to create a coverage chain in parallel to the contractual chain of indemnification running from the bottom rung subcontractor to the property owner at the top. Sole acts of negligence of entities higher up the chain always break the liability and indemnification chain in New York, and coverage is no different. Thanks to Chris Soverow for his contribution to this post.     Previous Next Contact

News Footing the Bill Does Not Necessarily Entitle Insurers to Privileged Documents (PA) February 15, 2013 < Back Share to: A recent decision in the Eastern District of Pennsylvania suggests increased hostility to the adoption of an absolute rule that insurers are co-clients with their insureds for the purposes of discovery in declaratory judgment actions. In the case of CAMICO Mutual v. Heffler, Radetich, & Saitta, LLP, CAMICO insured the defendant accounting firm’s administration of class action settlement funds and agreed to defend same under a reservation of rights when sued for misappropriation of proceeds. However, in the midst of funding the firm’s defense, CAMICO elected to pursue a separate action for declaratory judgment stating that its coverage obligations under the policy were limited to $100,000. Litigation proceeded apace in both cases until CAMICO propounded discovery demands upon the firm seeking the production of documents created in the defense of the misappropriation action. Unsurprisingly, the firm took exception, prompting CAMICO to file the subject motion to compel. While the firm argued that the responsive documents were insulated from disclosure by the attorney-client privilege, CAMICO countered by asserting that its common interest in the underlying defense gave rise to an exception. Applying the substantive law of Pennsylvania, Judge Jan E. DuBois of the Eastern District noted that both state and federal courts have consistently split on the issue. Specifically, Judge DuBois explained that while some courts in both jurisdictions recognize an absolute co-client relationship between insurer and insured, Pennsylvania’s appellate courts have recently endorsed a case-by-case approach that focuses on how the parties interact with the joint attorneys and each other. Adopting the second standard, Judge DuBois ultimately held that a co-client relationship did not exist because the firm independently retained defense counsel before CAMICO involved itself in the claim. As a result, CAMICO’s shared interest in the defense, without more, was insufficient to constitute a waiver of the attorney-client privilege and the motion was denied. Although CAMICO’s consideration of the attorney-client privilege in coverage disputes is limited to those circumstances where defense counsel is independently retained, the decision illustrates a growing trend against an absolute rule in Pennsylvania. To be sure, however, the court itself recognized that its decision does not preclude the possibility of a co-client relationship in all cases. Special thanks to law clerk Adam Gomez for his contribution to this post. For further information, please contact Paul Clark at pclark@wcmlaw.com Previous Next Contact

News Estate of Family Who Fled Nazi Germany Sues Met For Return of Picasso Allegedly Sold Under Duress November 18, 2016 < Back Share to: The estate of a family who fled Nazi Germany recently sued the Met Museum in the U.S. District Court, Southern District of New York, claiming that it was the rightful owner of a work by Pablo Picasso titled “The Actor.” According to the complaint in Zuckerman v. The Metropolitan Museum of Art, Paul Friedrich Leffmann, a successful and wealthy businessman from Cologne, Germany, purchased the work in 1912. After Germany’s Nazi regime implemented the Nuremberg Laws, the Leffmanns were forced to emigrate to Italy in 1937. There, according to the complaint, they faced the same kind of persecution they suffered in Germany. The plaintiffs further alleged that, due to the discriminatory and confiscatory laws in Italy, and the regulatory barriers associated with fleeing to countries such as Switzerland and Brazil, Lefmann, sold the Work under duress at a deep discount in 1938. After the Work changed hands at least two more times, the Work was donated to the Met in 1952. According to the complaint, the Met either knew and failed to disclose; or should have known that the Work had been owned by a Jewish refugee who only disposed the Work under duress because of Nazi and Fascist persecution. In support of this allegation, the plaintiff cited, among other things, State Department efforts to warn museums, libraries, art dealers, and others to use vigilance in identifying “cultural objects with provenances tainted by World War II.” The plaintiff also alleges that the Met published an inaccurate provenance for the Work, which indicated that Leffmann sold the Work much earlier than 1938. According to news reports on the case, the Met is expected to argue that Leffmann actually sold the Work at market value in 1938 and was therefore, not a sale under duress. The Met is also expected to argue that inaccuracies in the Work’s provenance were based on a former buyer’s inaccurate recollection rather than anything nefarious. It will be interesting to see how Zuckerman unfolds. There is no denying that the Nazi regime looted art and that many sales were made under duress. One question is whether a valuation analysis can shed light on the issue of whether this Work was sold at the then value or under duress. Watch this space. Thanks to Mike Gauvin for his contribution to this post. For more information, please email Dennis Wade at dwade@wcmlaw.com . Previous Next Contact

News NJ Insurer's Bad Faith Failure to Settle Issue for Fact Finder July 29, 2010 < Back Share to: When a jury returns a verdict well in excess of an insured’s policy limit after an insurer refused an offer to settle within the limit, a bad faith claim is not a matter of strict liability. In fact, the determination of whether the insurer acted in bad faith is a fact sensitive question that generally will require a plenary hearing or trial. In Wood v. New Jersey Manufacturers Ins. Co., the plaintiff postal worker alleged cervical and lumbar injuries were caused when she backed into a fence and a dog jumped up on her. She had cervical and lumbar surgeries and contemplated further surgery as the trial approached. A court appointed arbitrator had awarded the plaintiff $600,000 attributing 90% to the insured for a net award against the insured dog owner for $540,000, $40,000 above the policy limit. The defense rejected the arbitrator’s award, and at trial, the jury awarded a total of $2.4 million with an allocation of 51% to the insured (49% to the co-defendant property owner) for a net verdict of $1.4 million. Notably both the claims adjuster and the defense attorney had recommended settlement within the policy limit, but this had been rejected by the insurer’s Major Claims Committee. In an appeal by the insurer of summary judgment on the bad faith claim, the Appellate Division reversed and ordered further proceedings that would address the insurer’s reasonableness in their evaluation of the claim. The court recognized that an insurer could disagree with its counsel and even its adjuster’s evaluation of the case. A full hearing would give the insurer an opportunity to explain why it did so and allow a fact finder to fully assess the credibility and persuasiveness of the witnesses. Thus, an insurer is not expected to be “gifted with the powers of divination or of accurate prophecy,” and it will not automatically be held in bad faith when a jury awards an amount in excess of the policy limit. On the other hand, the insurer will need to be prepared to persuade a fact finder of the reasonableness of its actions. If you have any questions or comments about this post, please email Denise at dricci@wcmlaw.com . See Wood v. New Jersey Manufacturers Ins. Co. at http://www.judiciary.state.nj.us/opinions/a1768-08.pdf Previous Next Contact

News Functional Capacity Exams Accepted In New York September 29, 2010 < Back Share to: In Cristiano v. York Hunter Services, the Kings County Supreme Court denied a protective order to a plaintiff who was seeking to prevent the admission of a Functional Capacity Examination (FCE). The FCE is used generally to gage a person’s ability to return to work. Plaintiff argued that the FCE is a novel scientific methodology that has not been shown to have been generally accepted by the relevant scientific community. The court rejected this argument by noting that the New York Appellate Division has previously held that FCEs are commonly relied on by physicians when making determinations on a patient’s ability to return to work. Therefore, the FCE was admissible. For more information on this post, please contact David Tavella at dtavella@wcmlaw.com . http://pdf.wcmlaw.com/pdf/Cristiano.pdf Previous Next Contact

News New Jersey Opens Door to Treble Damages in Products Claims (NJ) January 22, 2021 < Back Share to: New Jersey’s Supreme Court troublingly opened the door to avaricious plaintiffs, potentially allowing plaintiffs to simultaneously allege product liability actions and actions under the Consumer Fraud Act. The Consumer Fraud Act allows for the potential of treble damages, attorneys fees, and costs to successful plaintiffs. Until recently, the Product Liability Act, which governs the strict product liability regime in New Jersey, subsumed almost every cause of action into a products claim, if the thrust of the claim was that of a defective product or warning. In Sun Chemical Corp. v. Fike Corp., 243 N.J. 319 (2020), a fire occurred that resulted in property damage and bodily injury. Relevant here, Sun had purchased a fire suppression system, and alleged that the fire suppression system manufacturer materially misrepresented that the “(1) the Suppression System would prevent explosions; (2) the Suppression System would have an audible alarm; (3) the Suppression System complied with industry standards; and (4) the System had never failed.” The Consumer Fraud Act broadly prohibits deceptive or misleading conduct or practices, including in the sale of goods. Typically, the CFA prohibits material misrepresentations or omissions. However, as relevant here, the CFA typically “punishes” express or affirmative misrepresentations more so than omissions or unintended deceptive conduct. Sun alleged affirmative and express material misrepresentations under the CFA. The New Jersey Supreme Court declared that the more serious “sins” of material affirmative and express material misrepresentations under the CFA were not subsumed under the PLA. Therefore, plaintiffs can now allege simultaneous product liability cases and violations of the CFA. Accordingly, we expect plaintiffs to allege CFA claims pursuant to written or verbal warranties, warnings, and representations, in order to obtain leverage with respect to the treble damages and attorneys fees under the CFA going forward. Thanks to Matt Care for his contribution to this post. If you have any questions or comments, please contact Colleen Hayes. Previous Next Contact