News Legal Malpractice Claims Barred Business Enterprise/Pursuits Exclusions January 17, 2013 < Back Share to: Professional liability policies are designed to cover errors and omissions committed by professional while providing or failing to provide services on behalf of their firms. Sounds simple enough. Problems arise when attorneys -or other professionals – act in different capacities, sometimes providing legal advice while at others offering business judgments or acting as “deal makers” for fledgling businesses. In Abrams, Fensterman, et al. v. Underwriters At Lloyd’s, London, a partner and his law firm found themselves in a real pickle over some business transactions that went bad. The underlying complaint alleged that the partner committed legal malpractice and engaged in fraudulent conduct when he induced the underlying plaintiffs to invest in a business formed to underwrite and sell insurance products. According to the disgruntled investors, when their seed money went missing, the law firm defendants falsely claimed that it was stolen by members of a royal family in the United Arab Emirates. Given the allegations of legal malpractice, the law firm defendants sought a defense and indemnification from their malpractice insurer. After some initial fact gathering, the insurer denied coverage citing two key policy exclusions commonly called the “business pursuits” and “business enterprise” exclusions. Closely aligned, these exclusions bar coverage for any claims arising out of or in connection with (1) a business “controlled, operated or managed by any insured” or (2) an insured’s activities as “a trustee, partner, officer, director or employee of a business " other than his law firm. Given the attorneys' alleged involvement in the formation, capitalization and management of the business venture, the court upheld the insurer's denial of coverage. Abrams, Fensterman reinforces that most professional liability policies seek to avoid assuming additional risk where an attorney “so intermingles his business relationships with his law practice” that the line between the two is blurred. When timely invoked, the courts will uphold those exclusions. If you have any questions or comments about this post, please email Paul at pclark@wcmlaw.com Disclaimer: This post is not intended to express any opinion on the merits of the allegations in the underlying lawsuit, which may or may not have any merit.   Previous Next Contact

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News Setting Chain of Events in Motion Not Necessarily a Cause (NY) September 26, 2017 < Back Share to: We have all seen the scenario when a tragic accident results from a chain of events where more than one actor could have legal fault. We see this situation frequently when one of the tortfeasor’s insurance limits fall far below fair compensation, resulting in lawsuits against so called “deep pockets.” Cases can be won on proximate cause when one party merely furnishes the opportunity for the real tortfeasor’s fault. In the recent case of Goldstein v. Kingston, a pedestrian was struck and later died from his injuries while walking in an intersection. The defendant driver was moving in reverse at the time of the impact. Minutes before the accident, the defendant was driving on a one-way street in Queens when she came upon workers employed by the defendant Forest Hills Garden Corporation, who were re-sodding a part of the grassy area between the curb and the sidewalk. After a worker waved at her in a manner that she understood to mean that she could not proceed further on the one-way street due to the ongoing work, defendant drove her vehicle in reverse to an intersection, where she struck the decedent, who was walking in a crosswalk. Goldstein, as executor of the decedent's estate and individually, commenced this action against the vehicle’s owner and driver, as well as Forest Hills Garden Corporation, to recover damages for wrongful death. The Supreme Court subsequently granted FHGC's motion for summary judgment dismissing the complaint insofar as asserted against it. The Appellate Division, Second Judicial Department affirmed the dismissal as to FHGC. FHGC established evidence that its employees' conduct in performing work near the roadway merely furnished the condition or occasion for the accident, and as a matter of law, was not a proximate cause of the decedent's injuries. The driver's decision to reverse her vehicle and drive back down the one-way street, ultimately striking the decedent, was the sole proximate cause of the accident. The trial court and the appellate court held that FHGC demonstrated its prima facie entitlement to judgment as a matter of law. FHGC merely furnished the condition or occasion for the accident, and was not a proximate cause of the decedent's injuries. The court reasoned that "There can be more than one proximate cause of an accident'" and "[g]enerally it is for the trier of fact to determine the issue of proximate cause." However, "liability may not be imposed upon a party who merely furnished the condition or occasion for the occurrence of the event' but was not one of its causes." Thanks to Vincent Terrasi for his contribution. For more information, contact Denise Fontana Ricci at dricci@wcmlaw.com .   Previous Next Contact

News Frequent Elevator Misalignment Creates Issues of Fact (NY) October 8, 2020 < Back Share to: In Napolitano v. Jackson "78" Condominium, the Appellate Division, Second Department addressed whether the defendants were entitled to summary judgment when plaintiff tripped while stepping into an elevator owned and/or managed by the defendants. The Supreme Court granted the defendants motions for summary judgment to dismiss the complaint insofar as asserted against them. Plaintiff allegedly tripped while going into the defendant’s elevator, and when she entered the elevator it was misaligned with the floor of the building’s lobby – which caused her fall. The Appellate Division stated that "A property owner can be held liable for an elevator-related injury where there is a defect in the elevator, and the property owner has actual or constructive notice of the defect" (citations omitted). Although the defendant-property owners were able to establish that no complaints were ever made about the misalignment of the elevator, and that they performed routine inspections, plaintiff was able to raise a triable issue of fact whether the defendants had notice of the defective elevator. Specifically, plaintiff submitted an affidavit from another tenant in the building which asserted that she frequently observed misalignment of the elevator and that a member of the condo board acknowledged the problem in her presence. In addition, plaintiff’s expert alleged the defendants performed an unsatisfactory inspection three days before the accident. This decision serves as a reminder that property owners likely will not prevail on summary judgment if the defect at issue has frequently been an issue in the past and if they perform unsatisfactory inspections of the defect. Thanks to Corey Morgenstern for his contribution to this post. Any questions, please contact Georgia Coats. Previous Next Contact

News Saw You Slipping In The Lobby (It Wasn’t Me) (NY) February 18, 2021 < Back Share to: Kwan v. Confucius Plaza Tenants, et al, No. 154794/2015, 2021 WL 419041 (NY Cty. Sup. Ct. Feb. 5, 2021) is a personal injury case, wherein Plaintiff alleged damages after a slip-and-fall in the lobby of her residential premises, which was owned and managed by defendants. Kwan was decided on summary judgment in favor of defendants, who were able to prove: “It wasn’t me.” How? Surveillance footage captured the entire incident. The accident occurred on a rainy day after Plaintiff and her daughter entered safely through the lobby’s vestibule and towards the elevators. Plaintiff and her daughter were carrying umbrellas, and the daughter was rolling a suitcase. The daughter entered the elevator safely, pulling her luggage along with her. As Plaintiff followed, she slipped on the exact spot where the suitcase had just traversed. The record contained conflicting testimonial evidence about the existence of warning signs, mats in the vicinity, and whether defendants had notice about the wet conditions that caused Plaintiff’s slip-and-fall. The Kwan Court did not buy Plaintiff’s account of the events. Under New York law, to establish liability in a slip-and-fall case, a “plaintiff must prove that defendant either created or had notice of the condition.” Here, Plaintiff could not create triable issues of fact to prevent dismissal on summary judgment. Defendants established, as a matter of law, they did not create the wet-floor condition. Specifically, the video footage, from the lobby, supported defendants’ theory – that Plaintiff and her daughter tracked water into the lobby vis-à-vis carrying wet umbrellas, walking with wet shoes, and pulling a wet suitcase. Plaintiff failed to provide countervailing evidence to these points. And defendants do not have an “obligation to provide a constant remedy” if water is “tracked into the building by individuals immediately preceding plaintiff.” Plaintiff also failed to create triable issues of fact that defendants had either actual or constructive notice the floor was wet. In terms of actual notice – defendants were never notified the floor was wet (or otherwise observed the floor being wet). In terms of constructive notice – “a defect must be visible and apparent, and it must exist for a sufficient length of time prior to the accident to permit defendants’ employees to discover and remedy it.” Here, Plaintiff failed to provide any evidence establishing how long the floor was wet before the accident. Additionally, the record was remiss of evidence that anyone else saw the floor being wet prior to the accident. The takeaway from Kwan is not novel: owners, managers, and operators of commercial and residential property should consider investing in surveillance cameras for the common areas of their respective premises. Doing so can save time and money, as it may permit prospective defendants to prevail on summary judgment by relying on the “it wasn’t me” defense. Of course, this type of defense can only be successful if prospective defendants comply with their legal duties under premises liability law. Otherwise, it could be defendants caught red-handed, letting water stay on the floor. 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 WCM Wins Again! Court Grants Time Bar Motion to Dismiss in NY July 25, 2024 < Back Share to: Hon. Judge Suzanne J. Adams, recently granted WCM's motion to dismiss plaintiff’s complaint in the case of New Liberty Pawn Shop, Inc. v. Certain Underwriters at Lloyd’s of London filed in the Supreme Court of the State of New York, New York County. Plaintiff New Liberty Pawn Shop Inc. (“New Liberty”) sought coverage under its policy of insurance issued by Defendants Certain Underwriters at Lloyd’s of London (“Underwriters”) after a reported theft. After the theft occurred, Underwriters conducted a preliminary investigation into New Liberty’s claim. Underwriters soon discovered that New Liberty was acting as the owner and controlling force behind Romanov Gold Buyers, another jewelry entity which was being criminally investigated. New Liberty did not disclose that it was acting as the controlling force behind Romanov on its application for insurance and essentially lied when filling out question 17(c) which required “the names and addresses of other locations of the proposer and of other concerns engaged in the jewelry trade under the same ownership or management as the proposer and not included in this proposal.” Underwriters determined that this misstatement was a breach of the policy and therefore disclaimed coverage on April 7, 2021. On October 27, 2023, thirty months after the disclaimer was issued, New Liberty filed suit against Underwriters asserting a cause of action for breach of contract. Notably, New Liberty’s policy contained Condition “n”, which provided that: “No suit, action or proceeding for the recovery of any claim under this Contract shall be sustainable in any court of law or equity unless the same be commenced within twelve (12) months next after discovery of the insured of the occurrence which gives rise to the claim…” We argued that New Liberty’s delay in filing violated the unambiguous terms of the policy, and therefore New Liberty’s complaint should be dismissed. Judge Adams agreed, holding that New Liberty’s complaint and amended complaint filed on November 6, 2023 were time barred and dismissed with prejudice. Time bar provisions are generally disfavored and scrutinized carefully, but in this case, Judge Adams fully WCM's position, and found excuse for New Liberty having waited more than two years to test the merits of the disclaimer. An important win for WCM and for our clients in London. Nice work by Dennis Wade, Mike Bono, Martha Osisek and Dominika Tomasetti in a true team effort. Previous Next Dennis M. Wade Dennis M. Wade Partner +1 212 267 1900 dwade@wcmlaw.com Contact

News Progressive Facing Class-Action Lawsuit for Stiffing Thousands on Totaled Cars (NJ) January 6, 2011 < Back Share to: As we've recently seen, some courts have seen the wisdom in treating insurance policies as individual contracts. But that may or may not be the case for Progressive Insurance, which faces a class action lawsuit in New Jersey Federal Court for allegations that it stiffed thousands of customers on fees such as title transfer and registration transfer fees when covering insureds’ claims for cars that were deemed totaled. The lawsuit sounds in breach of contract as plaintiff’s are alleging that Progressive and New Jersey Insurance Co. violated their policies by failing to pay the costs of those fees as part of the actual cash value of their vehicles. Plaintiff’s argued that an ACV policy indemnifies insureds such that the payment for the loss of a legally titled and registered vehicle legally operable in New Jersey necessarily includes, at minimum, an amount sufficient to legally operate a vehicle in New Jersey, just as the insureds did prior to the loss. Plaintiff’s attorneys are currently arguing that the case meets the requirements for Rule 23 certification, including that a class action is a superior means of resolving the claims. We will continue to monitor this case, Ferrara et al. v. Progressive Garden State Ins. Co., C.A. No. 2:20-cv-01183 (SRC)(CLW). Thanks to Jonathan Avolio for his contribution to this post. Please email Mike Gauvin with any questions. Previous Next Contact

News Do CGL Policies Now Insure Data Breaches? April 29, 2016 < Back Share to: The case that everyone is talking about is Travelers Indemnity v. Portal Health, a just released, unpublished Fourth Circuit opinion. The quick story is that the Fourth Circuit affirmed the trial court opinion and held that Travelers owed coverage (specifically defense) under a CGL policy for a data breach. The real story is a bit more nuanced. In the case, Portal Healthcare, a Virginia based company, was sued in NY in a class action lawsuit. In the lawsuit, patients of Glen Falls Hospital claimed that Portal Healthcare failed to safeguard medical records entrusted to Portal Healthcare by the hospital and instead allowed those records to be posted on the internet – accessible to everyone via a Google search. Portal Healthcare was insured by Travelers under two consecutive commercial general liability insurance policies – a 2012 policy and a 2013 policy. The Policies were not standard policies – rather they contained special endorsements that expanded the scope of personal injury, advertising injury and web site injury. Specifically, the 2012 Policy contained a Web Xtend Liability Endorsement that deleted and replaced the definition of Personal and Advertising Injury liability. The 2013 Policy contained an Amendment of Coverage B – Personal And Advertising Liability Endorsement that deleted and replaced the definition of Personal and Advertising Injury liability. Under both endorsements, the parties (and court) seemed to agree that coverage was triggered if the underlying complaint alleged: (1) injury arising out of the offense of “electronic publication of material that . . . gives unreasonable publicity to a person’s private life” (the language utilized in the insuring agreement of the 2012 Policy) or (2) injury caused by the offense of “electronic publication of material that . . . discloses information about a person’s private life” (the language utilized in the insuring agreement of the 2013 Policy). In respect of the first point, Travelers argued that, although the data was available to the general public, since Portal Healthcare did not intend to publish it, publication did not occur. This argument was rejected by the court which held that it was the fact of publication (and not the intent of publisher) that mattered. In respect of the second point, Travelers argued that there was no “publicity” given to a person’s private life as the leak was not intended to generate publicity. This argument was also rejected by the court which held that since the leaked data was available to the general public, publicity had occurred. All of this seems rather straightforward, so why all the fuss? It seems that a top sheet review might be to blame. When you look at the trial court’s decision and the policies themselves, you see that the Travelers’ decision to broaden the scope of potential claims that would qualify as “personal and advertising injury” is the root cause of the decision. So, it’s true that CGL policies might have more potential exposure to data breaches – but only if you enhance the coverages. For more information about this post please e-mail Bob Cosgrove. Previous Next Contact

Florida Our Offices New York Pennsylvania New Jersey Florida Louisiana Texas Long Island London Wade Clark Mulcahy LLP – West Palm Beach WCM established its Florida office in 2021. Since then, the office has earned a strong reputation for handling a broad range of matters, including insurance defense, insurance coverage, commercial litigation, and appellate work. Led by two Board-Certified Trial Attorneys, our Florida team litigates cases in all state court vicinages throughout Florida, as well as in federal courts. Over the past year, the office has experienced significant growth—reflecting our unwavering commitment to achieving positive results through high-quality legal work, professional integrity, and outstanding client service. In addition to our litigation capabilities, the Florida office maintains a dedicated focus on insurance coverage and coverage litigation. Our team is well-equipped to handle the full spectrum of insurance matters, from cargo and jeweler’s block/specie to homeowner’s and general liability claims. Contact Details 1555 Palm Beach Lakes Blvd, Suite 580, West Palm Beach, FL 33401 561 231 2744 561 828 4620 Attorneys and Professional Staff Laurence Cancel Senior Associate Vanancia C. Hyppolite Associate Maria E. Dalmanieras Partner Nishall N. Jairam Counsel Helene E. Dalmanieras Paralegal Peter R. Restani Partner Chip M-P George Of Counsel

News Illegal Immigrant Using False Documentation Wins Workers Comp Benefits October 31, 2008 < Back Share to: The courts in NY have grappled with wage claims by undocumented immigrants ever since the US Supreme Court touched on the subject in 2003 in Hoffman Plastic Compounds v. NLRB. New York's highest court addressed the subject in 2006 in Balbuena v. IDR Realty. In the Balbuena case, an undocumented immigrant obtained employment without proffering any fraudulent documents -- he simply applied for a job and was hired. The court held that "in the absence of proof that plaintiffs tendered false work authorization documents to obtain employment, [federal law] does not bar the maintenance of a claim for lost wages by an undocumented alien." Thus, the court ruled that the plaintiffs in Balbuena were entitled to pursue a lost wage claim for injuries caused by the defendants' violation of Labor Law 240 and 241. Now comes Amoah v. Mallah Management, decided yesterday by an intermediate appellate court in Albany. Mr. Amoah arrived in the US legally with a seven-month visa that did not allow him to work. He obtained a job using a friend's name, social security number, and driver license. That is, in the words of the Balbuena decision, he "tendered false work authorization documents to obtain employment." Many months later (and long after his visa had expired), Amoah was injured on the job. He applied for workers comp benefits under his assumed identity. He had the support of his friend (who had loaned Amoah his identity) because his friend, who we will call "The Dealmaker," agreed to the scheme as long as Amoah shared half of the workers comp award and two-thirds of any recovery in a lawsuit. Mr. Amoah found these terms too harsh and revealed his true identity to the workers comp board. He then pressed on with his workers comp claim under his true identity. The appellate court ruled that Amoah is entitled to workers comp benefits even though he used false documentation to get his job and even though he used the same false documentation in applying for benefits. The court's rationale was that to deny benfits to Amoah would encourage employers to hire illegal aliens in the hope that they (the employers) would then be able to escape comp claims by these same illegal aliens. Previous Next Contact

News Naked Cowboy Files Legal Briefs February 15, 2008 < Back Share to: The "Naked Cowboy", a tourist attraction in NYC's Times Square for over a decade has sued Mars, Inc., the makers of M&Ms for trademark infringement over a billboard depicting an M&M in what appears to be the Naked Cowboy's unique outfit. http://www.cnn.com/2008/CRIME/02/14/naked.cowboy/index.html Previous Next Contact

News Signed Releases Cook Plaintiff's Harrassment Suit Against McDonald's (NY) July 25, 2013 < Back Share to: It is not uncommon for a party who signs a pre-suit release to have "buyers remorse" and decide to file suit anyway. The issue recently arose in Nelson v. Lattner Enters. Of N.Y., where, despite signing a release, plaintiff sued a McDonald’s franchisee and the McDonald’s Corporation for sex discrimination and sexual harassment. Plaintiff was a restaurant manager for the franchisee for approximately six years, and reported to the Corporation that her supervisor, Lattner, repeatedly subjected her to sexual harassment. During a meeting in December 2007, plaintiff signed a handwritten settlement agreement, consenting to leaving her employment and releasing all claims in exchange for severance payment and medical benefits. In a subsequent meeting, plaintiff signed a typed settlement agreement and release which comprehensively released all defendants from any liability in exchange for severance pay of $18,688.10 and continued medical benefits. When bringing suit against the defendants, plaintiff claimed that the signed releases were not valid and should be void because she signed them under duress. The trial court dismissed plaintiff’s action and the Second Department affirmed the dismissal of the claims. Even assuming that plaintiff was under duress when signing the handwritten first agreement, the Court found that she was not under duress when signing the second typed agreement. In the second meeting, plaintiff was unable to demonstrate any unlawful act that compelled her to sign. Further, the Court noted that the typed agreement indicated in bold that she should consult with an attorney, that she had 21 days to consider the agreement, and that she could even revoke the release up to seven days after signing it. Notwithstanding the language in the agreement, the Court also found that plaintiff’s conduct waived her objections and ratified the agreement by accepting and retaining the benefits for nearly two years before bringing suit in 2009. Thanks to Jung Lee for his contribution to this post. If you would like more information please write to Mike Bono. Previous Next Contact