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News Even In Victory, The Rules Of Professional Conduct Still Apply September 6, 2017 < Back Share to: Following a favorable judgment in a bad faith case, plaintiff’s counsel in Clemens v. New York Central Mutual Fire Ins. Co., sought $1.12 million in fees, costs and interest. While Pennsylvania’s bad faith statute does permit an award of attorneys’ fees when an insurer has acted in bad faith, U.S. District Judge Malachy E. Mannion of the Middle District of Pennsylvania denied counsel’s request and referred the case to the Disciplinary Board of the Supreme Court of Pennsylvania. The plaintiff's attorneys sought $48,050 for their work on the UIM claim, $827,515 for working on the bad-faith claim and $27,090 for preparing the fee petition, for a total of $902,655 in fees for a case that had been litigated for nearly nine years. Judge Mannion began his memorandum opinion with a cautionary reminder that “attorneys are quasi-officers of the court and they are expected to be careful and scrupulously honest in their representations to the court . . . they must exercise care, judgment, and ethical sensitivity in the delicate task of billing time and excluding hours that are vague, redundant, excessive or unnecessary.” Judge Mannion then spent the next 100-pages going through plaintiff’s counsel’s request line-by-line, slashing fees he deemed vague, duplicative and excessive. Even in victory, lawyers are expected to adhere to the rules of professional conduct. As a self-policing profession, the enforcement of such rules can be lax, but this federal case is a strong reminder that unscrupulous conduct has no place in the court room. Thanks to Hillary Ladov for her contribution to this post. Previous Next Contact

News Material Misrepresentation in Auto Policy Application February 27, 2009 < Back Share to: In Consumer First Insurance v. Lee, the plaintiff appealed a dismissal of its declaratory judgment action against its insured. The Superior Court Appellate Division reversed and remanded, concluding that the insured made a material misrepresentation on his automobile insurance application regarding his lifelong epilepsy. As a result, plaintiff was required to extend only minimum mandatory statutory amounts of coverage to all claimants. Thanks to Sheila Osei for her contribution to this post. http://www.judiciary.state.nj.us/opinions/a5821-06.pdf Previous Next Contact

News Legislature Gives Green Light to Boarding Excess PIP Medical Expenses as "Economic Losses" (NJ) August 29, 2019 < Back Share to: Back in March, the New Jersey Supreme Court issued a landmark decision in Haines v. Taft, that substantially impacted boardable medical expenses in motor vehicle accident cases. As Brian Gibbons and Steve Kim first reported back in April, the Court’s decision essentially barred plaintiffs from admitting evidence of medical expenses that exceeded PIP policy limits. In reaching its conclusion, the Court analyzed the intent of the No-Fault scheme and evaluated the legislative history underpinning its formation – and invited lawmakers to intervene if they disagreed. The New Jersey Legislature responded, at breakneck speed, and recently passed two laws that supersede the Haines decision. The first piece of legislation, S-2432, allows injured victims of motor vehicle accidents to seek payment for medical expenses due to another’s negligence specifically when they exceed PIP coverage limits. The second piece of legislation, S-3963, confirms that injured victims may only recover unreimbursed medical expenses and clarifies that any excess expense must be limited to costs prescribed by the statutory PIP medical fee schedule. The result is a boon for the plaintiff’s bar, which has increasingly used snowballing medical expenses to raise arbitration awards and shock juries into increasing verdict amounts across the state. With the passing of S-2432 and S-3963, plaintiffs will now be firmly permitted to board any and all medical expenses in excess of PIP policy limits as “economic loss” damages – subject only to the cost limits prescribed by the existing statutory PIP medical fee schedule. Oddly enough, the Haines Court disapproved of the very outcome the legislature adopted, warning that treating excess medical expenses as boardable economic losses (while not permitting the recovery of PIP medical expenses themselves) may result in instances where lower PIP coverage limits ($15,000) with high boardable “economic loss” medical expenses yield higher reimbursements than standard PIP policies ($250,000) with no boardable medicals. Thanks to Brent Bouma for his contribution to this post. Please email Vito A. Pinto with any questions. Previous Next Contact

News Third Department Rules Plaintiff Raises Insufficient Evidence of a Defective Condition and Constructive Notice November 10, 2023 < Back Share to: In Guzman v. State , Plaintiff alleged that she tripped and fell after she “stepped into a cracked uneven, raised, depressed portion of the ground in the parking lot." 2023 N.Y. Slip Op. 05566 (3d Dep’t Nov. 2, 2023). Plaintiff alleged that the State of New York was negligent in maintaining the parking lot and sought to recover for her injuries. The trial court found that Plaintiff “failed to establish the existence of an actionable dangerous condition and that defendant had not received notice of any such condition.” Id . The Third Department affirmed, holding that Plaintiff did not meet her burden of demonstrating a defective condition existed in the parking lot because she did not measure the hole she alleges she fell on and only briefly glanced at the hole following the fall. Additionally, Plaintiff and her daughter testified that the weather was clear the date of the accident, but photographic and video evidence depicted a hole filled with water, which prevented the trial court from being able to effectively evaluate the alleged defective condition as it was claimed to have existed on the date of the accident. Id . Regarding Plaintiff’s failure to demonstrate actual or constructive notice, the Third Department cited the testimony of two Department of Transportation employees who both denied receiving any complaints about the hole where Plaintiff allegedly fell prior to Plaintiff’s accident. The Third Department deferred to the trial court’s finding that Plaintiff failed to demonstrate that an actionable condition existed for a sufficient period of time to establish constructive notice thereof. Id. Guzman v. State .pdf Download PDF • 151KB Previous Next Contact

News New York High Court Holds “Ordinary Vehicle Repair” Not Covered Under Labor Law January 5, 2024 < Back Share to: Plaintiff, a diesel technician, was working beneath defendant’s lifted trailer on broken air brakes when the trailer collapsed on him, causing grievous personal injuries. The question presented to the New York Court of Appeals in Stoneham et al v. Barsuk, Inc. et al, was whether “plaintiff was engaged in an activity protected by Labor Law §240(1).” 2023 NY Slip Op 06467 (2023). The Court held that the legislature did not intend Labor Law §240(1) to encompass “ordinary vehicle repair” and that the lower courts correctly dismissed the §240(1) claims. Plaintiff used a front loader to lift the trailer five and a half feet and began working to install the new air brake equipment. As Plaintiff was installing this equipment, the trailer fell on him, pinning him to the ground. Plaintiff commenced his action alleging a §240(1) claim among other claims, then moved for summary judgment. Defendant cross-moved. The trial court denied plaintiff’s motion and granted defendant’s. The Appellate Division affirmed, holding that §240(1) did not contemplate “the vehicle repair work at issue here” because it was not “a protected activity within the meaning of” §240(1). Id . The Court of Appeals affirmed, holding that §240(1) does not apply simply because a plaintiff’s injury results from “an elevation differential.” Id . The Court further held that in considering a “holistic view of the statute, ordinary vehicle repair” would extend the statute far beyond the purpose for which it was intended. Id. The Court discussed that if it were to hold Defendant liable in this instance, car owners would be “absolutely liable for car-related injuries that occurred when a mechanic was working on their car” which was not intended by the legislature, despite Plaintiff’s severe injuries. Id . Stoneham et al v. Barsuk - NYCA .pdf Download PDF • 427KB Previous Next Contact

News Certified Mail Without Returned Receipt... Worthless (NY) March 19, 2013 < Back Share to: In Tower Insurance Co. of NY v. Ray & Frank Liquor Store, Inc. et al, the insurer sought a declaratory judgment with respect to coverage disclaimed to an insured for a claim in underlying litigation. The defendant insured had given late notice of the claim, and the plaintiff sent a disclaimer in response. The disclaimer was sent via certified mail return receipt requested. However, at the bench trial, the insurer only produced the letter - not the signed receipt. The only witness to testify did not personally mail the letter, and no one was produced to testify regarding mail policies in a more general way. The matter proceeded to trial and the judge ruled in favor of the insurer, finding that it was not obligated to defend and indemnify the defendants. However, the First Department reversed the trial court's decision, finding that the insurer failed to adequately demonstrate that the disclaimer letter was actually mailed. Specifically, the insurer's failure to produce the return receipt or otherwise provide direct evidence of mailing was fatal to its cause. The moral of the story is that sending a significant document, such as a disclaimer, by certified mail is only the first step. In order to prove service, there must be testimony by one with knowledge that the document was actually mailed or, if available, a receipt showing actual service was made offered in evidence. Special thanks to Georgia Stagias for her contribution. For more information, contact Denise Fontana Ricci at dricci@wcmlaw.com .   Previous Next Contact

News Insurers Permitted To Intervene In Human Trafficking Suits (PA) October 14, 2021 < Back Share to: On October 7, 2021, the Pennsylvania Superior Court permitted insurers to intervene in cases brought against insureds arising out of alleged sex trafficking operations. A.H. v. Roosevelt Inn, LLC, et al, 1797 EDA 2020 (Pa. Super. Ct. Oct. 7, 2021). The plaintiff, an alleged victim of human trafficking, sued numerous defendants asserting that she was “exploited by traffickers of commercial sex acts and those who financially benefits from her exploitation.” The defendants allegedly knew of the sex trafficking at their premises and failed to prevent the activity or otherwise notify authorities of same opting instead to profit from the activity. The Complaint stated multiple claims for negligence, some arising out of the Pennsylvania sex trafficking statute, negligent infliction of emotional distress, negligent hiring, training, and/or supervision, as well as punitive damages. The insurers of some defendants filed petitions to intervene in the underlying suit solely requesting to submit a specific jury interrogatory and verdict slip to ensure that het basis of the jury’s finding is clear so the carriers could make coverage determinations. More specifically, the insurers sought instructions to determine whether any punitive damages award was based on direct or vicarious liability and whether the jury found that a given defendant violated the Pennsylvania trafficking statute. The trial court denied the petition. The insurers appealed, raising four issues for review. First, whether the court has jurisdiction to hear the interlocutory appeal. Second, whether the trial court abused its discretion by misapplying prior precedent regarding the right to intervene for purposes of securing a record that will identify whether any verdict is based on a claim for which indemnification may be barred by public policy. Third, whether the trial court abused its discretion by denying the petition on the grounds that the insurer’s interests are adequately addressed by counsel retained to represent the insured. Four, whether the trial court abused its discretion by denying the petition without a hearing. The Superior Court agreed with the insurers as to the first issue, finding that the denial was a collateral order separate from the main cause of actions because the right involved is too important to be denied. In evaluating the factors, the Court considered the following dispositive facts: (1) the right to intervene could not be resolved without addressing the addressing the merits of the underlying action; (2) resolution of the underlying action will not resolve the indemnification questions for the insurers; and (3) the insurers would be denied the ability to submit jury interrogatories or a special verdict form at the close of trial absent intervention. The Court considered the remaining questions together. In Pennsylvania, intervention is governed by two procedural rules: (1) Rule 2327 which governs who may intervene; and (2) Rule 2329 which provides the method for intervention. Rule 22329 expressly contemplates a hearing. The Rule states: “[u]pon the filing of the petition and after a hearing, of which due notice shall be given to all parties.” The trial court here failed to hold a hearing. The Superior Court concluded that the trial court “manifestly abused its discretion” in denying the petition. In holding that an insurer has a right to interevent to propose a special verdict form and jury interrogatories to assist in coverage determinations regarding indemnification, the Court relied on a case from earlier this year, Bogdan v. AM Legion Post 153 Home Ass’n, 2021 PA. Super. 127 (Pa. Super. Ct. June 23, 2021). In Bogdan, the court permitted a liquor liability insurer to intervene for the purpose of issuing special interrogatories to the jury’s verdict which would assist the insurer in subsequent coverage determinations. The trial court’s reliance on the fact that the insured’s counsel could address coverage issues was misplaced. The Superior Court agreed with the insurers that defendant counsel is “not expected to address any insurance coverage issues.” In so holding, the Superior Court noted the obvious potential for conflicts arising out of situations in which defense counsel is retained to represented the interests of individual defendants while simultaneously representing the interests of insurers who could have a duty to indemnify the defendants. The trial court’s order was reversed and the case remanded. Thanks to Jennifer Seme for her contribution to this post. Please contact Jennifer with any questions. Previous Next Contact

News US Supreme Court Issues Important Product Liability Decision. February 26, 2010 < Back Share to: When litigating a claim, if the parties reside in different states, the claim may be brought in federal court, as opposed to state court, under diversity of citizenship grounds. If an action is brought in state court, and diversity of citizenship exists, the parties may request that the case be removed from the state court to the federal court. The issue of diversity is important since, most plaintiffs prefer to sue in state court, where the "home town" advantages are much more real, and thus defendants often try to remove the case to federal court. In a unanimous ruling on Tuesday, February 23, 2010, the United States Supreme Court has determined that for the purposes of diversity of citizenship, a corporation will be deemed a resident of the state only where the company’s executives maintain their offices. The Court held that the “principal place of business” is located at the “corporate headquarters” or “nerve center” where the corporation’s officers “direct, control, and coordinate the corporation’s activities.” This is an important ruling because although a corporation could sell their products in all fifty states, that corporation cannot be considered a resident of any state its products are sold, except the state in which its corporate headquarters is located. If someone claims they bought a defective product in their home state, they can no longer “hometown” the corporation in a product liability suit by bringing their action in their home state court. If the litigant attempts to gain the hometown advantage by commencing the action in state court, the corporation will be able to swiftly remove the case to federal court on the basis of diversity of citizenship. Effectively, this ruling provides corporations with another strategic avenue to increase the likelihood of fair litigation, without the claimant obtaining the hometown advantage. This ruling may also change the structure of class action suits, where one representative member is chosen from the class for the purposes of determining diversity. If the class wants to litigate in state court, the only state court option will be that state where the corporation is headquartered, and the representative of the class will have reside in the same state as the corporation. Corporations selling products in many states should be prepared to ask for removal to federal court any time they are sued in state court, and should expect to see an increase in federal litigation as a result of this decision. If you would like more information about this post, please contact Bob Cosgrove at rcosgrove@wcmlaw.com . Special thanks to Alison Weintraub for her contributions to this post. http://www.supremecourtus.gov/opinions/09pdf/08-1107.pdf Previous Next Contact

News The New Judicial Hellhole Rankings Are Out! January 28, 2011 < Back Share to: And Philly tops the list -- http://www.judicialhellholes.org/wp-content/uploads/2010/12/JH2010.pdf Atlantic County, New Jersey and New York City are merely on the "watch list." Of course, as with all rankings, this ranking from the American Tort Reform Association must be taken with more than a grain of salt. A large part of Philadelphia's number one ranking can be attributed to the rise in mass tort cases. But, an equally large part of the ranking seems to flow from the fact that Pennsylvania remains (notwithstanding the introduction of proposed bills in the legislature -- http://www.legis.state.pa.us/cfdocs/billinfo/billinfo.cfm?syear=2011&sind=0&body=S&type=B&bn=0002) one of the few states to retain joint and several liability, i.e. the principle that 1% of negligence buys a defendant the potential of having to satisfy the entire judgment. Insurers beware! Philadelphia might not be so brotherly in its love for you! If you would like more information about this post, please contact Bob Cosgrove at rcosgrove@wcmlaw.com . Previous Next Contact

News Graves Amendment Immunity Denied To Auto Company If Liability Not Completely Based On Ownership (PA) March 10, 2023 < Back Share to: In the recent case of Burns v. Shama Express LLC, The United States District Court for the Western District of Pennsylvania found the Graves Amendment to the Safe, Accountable Flexible and Efficient Transportation Equity Action of 2004 is inapplicable when the liability attempting to be placed on an automobile company is grounded, even in part, in any basis other than ownership. Burns involves an automobile-trucking collision resulting in death of Plaintiff for negligence and negligent infliction of emotional distress, under Pennsylvania’s Wrongful Death and Survival Acts. Bowman owned the subject-truck that allegedly caused the accident. Plaintiff alleged, in part, that Bowman through its “employees, servants, or agents,” breached its duty, as the owner and operator of the subject-truck, “to be alert and maintain control of the vehicle,” and that Bowman negligently trained its truck operators. Bowman filed a Motion to Dismiss arguing that its only involvement in the underlying events was that it leased the subject-truck, months before the incident took place, and was therefore immune from vicarious liability under the Graves Amendment. The Graves Amendment provides: (a) In general.—An owner of a motor vehicle that rents or leases the vehicle to a person (or an affiliate of the owner) shall not be liable under the law of any State or political subdivision thereof, by reason of being the owner of the vehicle (or an affiliate of the owner), for harm to persons or property that results or arises out of the use, operation, or possession of the vehicle during the period of the rental or lease, if— (1) the owner (or an affiliate of the owner) is engaged in the trade or business of renting or leasing motor vehicles; and (2) there is no negligence or criminal wrongdoing on the part of the owner (or an affiliate of the owner). 49 U.S.C. § 30106. The magistrate determined that “[b]ecause plaintiff had sufficiently alleged, at this initial stage, that Bowman was negligent, the Graves Amendment cannot serve as a basis for immunity.” The court ultimately adopted the magistrate’s Report and Recommendation and dismissed the Motion to Dismiss. Burns is a cautionary tale for defendants engaged in the trade or business of renting or leasing motor vehicles. It makes clear that Graves Amendment immunity from liability is only applicable to liability grounded exclusively in ownership; on the other hand, vehicle owners who themselves, or through agents, engage in negligence, are not protected by the Amendment. Thanks to Stephen Kerstein for his assistance in this post. Should you have any questions, please feel free to contact Tom Bracken. Previous Next Contact

News How Careful Should Athletes (and Defendants) Be in New Jersey? (NJ) November 21, 2019 < Back Share to: In Mesar v Bound Brook Board of Education, a teenage plaintiff sued his local school board after he severely broke his ankle while playing baseball for the school team. Specifically, he claimed the assistant coach improperly signaled for him to slide into third base as he approached, causing the injury. The defendants won summary judgment in the first instance and plaintiff appealed. The Appellate Division took the opportunity to reiterate that although it is incumbent on instructors and coaches not to increase the risks over and above those inherent in the sport, the appropriate standard of care for accidents in sports is recklessness. However, in making this motion, defendants argued plaintiff had failed to plead recklessness in his complaint, rather than arguing, plaintiff presented insufficient facts to support a claim of recklessness. When evaluating whether a complaint should be dismissed for failure to state a claim, the Court must determine “whether a cause of action is ‘suggested’ by the facts,” and the Appellate Division found plaintiff’s complaint met that very lax standard. As a result, even though defendants successfully obtained the higher standard of care for the time of trial, refraining from arguing insufficient evidence to satisfy the standard meant the motion was remanded to revisit that issue. The ruling is beneficial for defendants in that it pushes back on any narrowing of the recklessness standard in the context of sports accidents, but it is a reminder to make alternative arguments on dispositive motions to close any possible backdoor escape hatches for plaintiff’s counsel. Thanks to Nicholas Schaefer for his contribution to this post. Please e-mail Vincent Terrasi with any questions. Previous Next Contact

News Frozen Pizza Quest no Excuse of PA Fall June 22, 2018 < Back Share to: Recently, a Pennsylvania court evaluated a grocery store’s liability for injuries caused by known or obvious conditions. In Walker v. Save-a-Lot. Plaintiff was shopping in a grocery store when she tripped and fell on a pallet displaying cases of water in the middle of the frozen food aisle. Plaintiff walked toward the pallet on her way to the freezer and situated her cart adjacent to the pallet. After grabbing a frozen pizza, plaintiff stepped away from the freezer and tripped over the pallet. Defendant sought summary judgment on the ground that the pallet created a known or obvious condition. Plaintiff claimed she did not see the pallet as she was focused on finding a frozen pizza. Surveillance footage showed that the plaintiff walked by one pallet displaying cases of water before she approached a second pallet displaying the same. The court turned to prior decisions addressing the duty of care owed to invitees and concluded that it is established Pennsylvania law that a person must look where he is going, further explaining that customers are not relieved of this responsibility even if they are distracted by sales displays. The court concluded that the fact that the plaintiff claims she did not see the pallet because she was focused on finding her frozen pizza does not excuse the fact that the pallet was a known or obvious condition that she failed to avoid by the exercise of ordinary care. Thanks to Chelsea Rendelman for her contribution to this post and please write to Mike Bono for more information. Previous Next Contact