Wade Clark Mulcahy LLP

News When Does Art Really Lose Its Value? December 7, 2012 < Back Share to: We, here, at WCM are often asked to tackle the appropriate legal measurement of a work of fine art's loss in value. Often times, when we get involved, one side or the other has declared the work a "total loss" requiring full market or scheduled value repayment. But, perhaps, that is the wrong way of looking at things since even damaged art can have value. This interesting article profiles the Salvage Art Institute, an organization that takes the position that even damaged art has value. The question is -- can that value be measured in terms a court will accept? For more information about this post, please contact Bob Cosgrove at rcosgrove@wcmlaw.com . Previous Next Contact

News Broad Policy Exclusions Are Vulnerable to Reasonable Expectations (PA) November 23, 2022 < Back Share to: On November 2, 2022, in Atain Insurance Company v. V2 Properties LLC, the Eastern District of Pennsylvania, Judge Padova issued a memorandum decision denying Atain Insurance Company’s (“Atain”) motion for judgment on the pleadings, arguing that its policy issued to V2 Properties (“V2”) provided no coverage for losses sustained in connection with a personal injury judgment entered against V2. The personal injury judgment resulted from a decedent’s fall from scaffolding while performing masonry work at a home construction site in Philadelphia. In the underlying action, it was alleged V2 was the general contractor for the project, responsible for the safety of all work performed. Based on an allegation in the underlying complaint stating that the decedent was a business invitee and construction worker performing masonry work at the site, Atain asserted that the decedent fell under “one or more of the several types of workers identified in the Employer’s Liability Exclusion,” and therefore, sought a judicial declaration stating it did not owe V2 a defense or indemnification in respect of the underlying action. In response to the declaratory judgment complaint, V2 asserted, among other things, an affirmative defense stating the policy did not reflect the reasonable expectations of the insureds and asserted the policy should be reformed to do so. Specifically, the policy’s Employer’s Liability Exclusion, barred coverage to, any insured to indemnify or contribute with another because of damages arising out of “bodily injury” to an “employee”, subcontractor, employee of any subcontractor, “independent contractor”, employee or any “independent contractor”, “temporary worker”, “leased worker”, “volunteer worker” of any insured or any person performing work or services for any insured arising out of and in the course of employment by or service to any insured for which any insured may be held liable as an employer or in any other capacity. In arguing against Atain’s judgment on the pleadings, V2 asserted that the exclusion is ambiguous as applied because it is unclear if “it is limited in its application to only those injuries sustained by direct employees of [V2]” or “vitiates all insurance coverage for the insured's most common and foreseeable liability risk—liability for injuries to any workers on the construction job site.” This was rejected by the court because the language does not give rise to multiple meanings; however, the question of whether the language is reasonable in light of V2’s expectations, as an affirmative defense, was an issue on which the court was unwilling to rule. Specifically, it stated that the totality of the insurance contract had not been established and therefore it was not possible to ascertain the reasonable expectations of the insured. Accordingly, the court denied Atain’s motion and determined the question of reasonableness should be resolved on a full factual record. Thanks to Richard Dunne for his contribution to this article. Should you have questions, contact Matthew Care. Previous Next Contact

News No Duty to Defend: Insurers Off the Hook in "Ghost Gun" Sales Case September 20, 2024 < Back Share to: In Granite State Ins. Co. v. Primary Arms LLC , insurance company plaintiffs Granite State Insurance Company ("GSIC") and National Union Fire Insurance Company of Pittsburgh, Pa. ("National Union") sought a declaratory judgment that they did not owe a duty to defend or indemnify their insured, Texas-based firearms dealer Primary Arms LLC ("Primary"), in three underlying lawsuits filed in New York. These lawsuits were brought against Primary under the insuring agreements in their commercial general liability policies. Granite State Ins. Co. v. Primary Arms LLC , No. 23 CIV. 7651 (LGS), 2024 WL 4008167, at *1 (S.D.N.Y. Aug. 30, 2024). In the underlying lawsuits, plaintiffs allege that Primary sold and shipped unfinished firearm parts that evaded gun control laws and regulations, and that its sales contributed to an increase in gun violence. The untraceable firearms made from these parts are referred to as “ghost guns.” Applying Texas law, the court found that the underlying lawsuits contained allegations that Primary “took deliberate action to enable the anonymous acquisition of uncontrolled firearms with the predictable outcome of increasing gun violence.” Therefore, Primary’s actions did not constitute an “accident” or “occurrence” triggering coverage under the GSIC and National Union policies. The court noted, “The claim is not that [Primary] forgot to run a background check on certain customers or misplaced its paperwork; rather, the allegations are that [Primary] made a deliberate choice not to implement internal controls.” Accordingly, the court granted the insurance companies' motions for summary judgment, finding that neither owed a duty to defend Primary in the lawsuits involving injuries due to Primary’s allegedly intentional conduct. Granite State Insurance Company v. Primary Arms LLC .pdf Download PDF • 169KB Previous Next Contact

News Do You Even Care? (NY) September 5, 2019 < Back Share to: In Rosen v Hilo Maintenance, the New York Supreme Court addressed a third party contractor’s duty of care to a plaintiff injured on a jobsite. By way of background, plaintiff, Rosen, sued Hilo Maintenance, a third party contractor, to recover for alleged injuries that were sustained when he fell off of a loading dock ramp while he was working back in August 2014. In the plaintiff’s lawsuit, it was claimed that Hilo was negligent. Specifically, plaintiff claimed that Hilo did not repair the ramp’s hold-down mechanism properly. Eventually, Hilo moved for Summary Judgement arguing that it did not owe a duty to the plaintiff. Hilo claimed it never did any work on the alleged hold-down mechanism. The court did not agree with Hilo. The court found that an issue of fact existed and the case should proceed to trial. Specifically, the court found that the affidavits submitted by Hilo, in support of its Motion for Summary Judgment, were “conclusory, lacking in foundation, and speculative.” The court reasoned that even though Hilo demonstrated that it was an independent contractor hired by a non-party to repair its loading docks, Hilo did not establish that it did not “launch an instrument of harm, that plaintiff did not detrimentally rely on its contractual duties, and that it did not displace the property owner’s duty to safely maintain the premises.” These are the three main factors that are laid out in Espinal v. Melville Snow Contrs. regarding a third party contractor’s potential duty to a plaintiff. The take away here is simple. If you are a third party contractor looking to get out on Summary Judgement under Espinal make sure you conduct discovery thoroughly and have evidence showing there is no issue of fact, with respect to these aforementioned factors, as a court may determine any affidavits are “conclusory, lacking in foundation, and speculative” and are not going to cut it. Thank you to Marc Schauer for his contribution to this post. Please email Colleen E. Hayes with any questions. Previous Next Contact

News Plain Meaning of Insurance Contract Prevails in New Jersey December 6, 2012 < Back Share to: In the recent unreported decision of Chery v. New Jersey Indemnity Insurance Company, plaintiff Michelle Chery was injured in a hit-and-run motor vehicle accident, and sought compensation through an uninsured motorist claim against New Jersey Indemnity Insurance Company. Pursuant to the policy, plaintiff was entitled to $15,000 in UM coverage and was expressly contracted to be bound by an arbitration award unless it exceeded $15,000. The parties proceeded to arbitration, where an award of $17,500 was awarded to the plaintiff. Defendant appealed and filed for a trial de novo. Plaintiff filed a complaint to confirm the arbitration award, and a motion for summary judgment. In her motion, plaintiff argued that, because the mandatory minimum liability limit specified by the Financial Responsibility Law of New Jersey, and the actual liability limit of defendant’s policy are the same ($15,000), the contract provision does not permit defendant to appeal the award or demand a trial de novo. The Appellate Court disagreed with plaintiff’s argument, noting that the policy contained no provision, expressed or implied, that the plain language was inapplicable where the UM limit of the policy and the minimum for liability specified by the Financial Responsibility Law were the same. Since the language of the policy was unambiguous, defendant was legally entitled to reject the arbitration award and proceed to trial. Thanks to Heather Aquino for her contribution to this post.   Previous Next Contact

News Governor Murphy has Re-Opened More Businesses Amid COVID-19 (NJ) May 15, 2020 < Back Share to: On May 13, 2020, Governor Murphy stated that New Jersey will allow more businesses to re-open. This declaration comes as the Governor said he plans to provide hard dates for restarting New Jersey’s economy. The Governor is allowing non-essential retail stores to conduct online pickup and phone/internet ordering. In addition, non-essential construction is now allowed to resume. Gatherings of vehicles for drive-in movies or religious services are no longer violations of the Governor’s order prohibiting mass gatherings. However, people must remain in their cars. What does this mean for New Jersey Courts? Courts in New Jersey remain open, but conferences continue to be conducted via video and/or telephone. Additionally, jury trials remain suspended and no new trials are being scheduled. Also, while discovery is being routinely extended via motion and upon request, litigants continue to try to conduct discovery and take depositions via video and/or telephone. We will continue to keep you updated on the status of New Jersey courts as things develop. Thanks to Michael Noblett for his contribution to this post. If you have any questions or comments, please contact Colleen Hayes. Previous Next Contact

News Court Curtails Use of Incompetent's Settlement (NY) November 22, 2013 < Back Share to: Most parents who serve as court-appointed guardians for their disabled child would know what is in their child’s best interest and would use settlement proceeds to advance those interests. But that does not mean that courts will abdicate their oversight responsibilities. In the Matter of the Application of Geoffrey M. and Jordanna M. involves Sigal M., a girl who suffers from cerebral palsy, quadriparesis, microcephaly, and other developmental issues. Previously, she had been adjudicated incapacitated under Mental Hygiene Law 81.02(b), and had received a structured settlement. The amount in the estate at the time of this decision was approximately $8 million. Sigal’s parents, who are also her co-guardians, sought to use a portion of those funds to pay $33,349 on the bat mitzvah party for her and 237 guests, and $60,000 on a trip to Israel for Sigal, her family, and an aide. The Nassau District Court rejected the request. In reaching its decision, the court considered two approaches. The first, followed by the First and Second Departments, limits withdrawals to necessities and education that cannot otherwise be provided by the parents. The second, articulated by Court of Claims Judge David Weinstein focuses on the best interests of the child. Noting that Article 81 is silent with respect to extraordinary expenses such family holidays and culturally significant milestones, the court focused on the necessity of preserving the estate for the child. For that reason, and because Sigal’s parents were people of means, the court denied the parents’ request to use the money to pay for the bat mitzvah and limited the amount of funds to be used on the vacation. Expenses for the daughter, her aide, and her mother were appropriate, but the court refused to allow expenses for the parents’ hotel room, and expenses related to Sigal’s siblings. Most parents believe they know what is best for their children, but courts have oversight responsibilities. When a guardian spends a disabled person’s money, courts will scrutinize whether the expenditures are for the disabled person or their family as a whole. Based on this decision, even when a disabled person has a major life event on the horizon, their guardians would be well advised to keep estate expenditures as ordinary as possible. Thanks to Mike Gauvin for this post. If you have any questions, please email Paul at pclark@wcmlaw.com Previous Next Contact

News DUI: Compensatory or Punitive Damages? (PA) June 13, 2019 < Back Share to: The Pennsylvania Court of Common Pleas, Lawrence County, recently addressed whether individuals who cause damages as a result of driving while intoxicated are automatically liable for punitive damages. In Tornabene v. Crivelli, Defendant Crivelli operated a vehicle while under the influence of alcohol when he struck Plaintiff’s vehicle causing significant injuries to the Plaintiff. Plaintiff sued the Defendant seeking, inter alia, punitive damages. Under Pennsylvania law, "punitive damages may be awarded for conduct that is outrageous, because of the defendant's evil motive or his reckless indifference to the rights of others." To support a claim for punitive damages, the plaintiff must show that the defendant had a subjective appreciation of the risk of harm to which the plaintiff was exposed and that the defendant acted, or failed to act, in conscious disregard of that risk. In Tornabene, the court found there was no evidence that the Defendant had a subjective appreciation of the risk of his actions. Specifically, Plaintiff's complaint lacked any specific details of Defendant’s state of mind at the time of the crash, or that in his state he consciously disregarded the risk of driving while intoxicated. Additionally, there was no evidence of how Defendant's inebriation affected his driving. Further, there were no details about the manner in which Defendant operated his vehicle such as: his estimated rate of speed in relation to other traffic; his use/nonuse of turn signals as he changed lanes; any near collisions with other drivers; any use of a cell phone while behind the wheel; or any other distractions or decisions that would have impeded his safe operation of the vehicle. Further, the Court laid out certain criteria that could have been included to bolster the punitive damages claim: whether Defendant consumed alcoholic beverages while behind the wheel or prior to entering the vehicle, and how many; whether Defendant manifested signs of intoxication at the incident scene (such as slurred speech, bloodshot eyes or an unsteady gait); whether any tests were performed by law enforcement and the results, if any, such as blood alcohol concentration (BAC) or field sobriety tests; or whether Defendant was criminally cited for any alcohol consumption. Although arguments were made that driving while intoxicated necessarily indicates a conscious disregard such that punitive damages should apply, based on this case, it appears that some Pennsylvania courts may not agree with this argument. Thank you to Malik Pickett for his contribution to this post. Please email Colleen E. Hayes with any questions. Previous Next Contact

News In Trademark Dispute over Engagement Rings, the Second Circuit Court of Appeals asks the Southern District of New York to Reconsider (NY) August 28, 2020 < Back Share to: In Tiffany and Company v. Costco Wholesale Corporation, the United Second Circuit Court of Appeals found a triable issue of fact as to whether Costco’s otherwise unbranded engagement rings identified as “Tiffany” rings by signs placed at the point-of-sale infringed upon Tiffany’s trademark. As part of its lawsuit, Tiffany alleged, that these point-of-sale signs constituted trademark infringement under the Lanham Act. Specifically, Tiffany alleged that Costco by displaying of these signs throughout its stores deliberately misled consumers as to the actual source of the rings. On summary judgment, the trial court agreed, entering judgment in favor of Tiffany and awarding Tiffany approximately $21 million in trebled profits, prejudgment interest, and punitive damages. Costco appealed the trial court’s decision arguing that there was a genuine issue of material fact as to whether there was a likelihood of confusion to consumers based upon Costco’s conduct. Courts in the Second Circuit follow an eight-part factor test in assessing whether there was a likelihood of confusion. In its appeal, Costco cited three of those factors as being in dispute: (1) actual confusion; (2) good faith; and (3) consumer sophistication. The Second Circuit agreed with Costco. In assessing actual confusion, the lower court found that evidence presented by Tiffany established that no reasonably jury could find in favor of Costco. The lower court pointed to testimony from six Costco customers who stated they were confused by the signs, as well as results from a survey of self-identified Costco customers in which two of five respondents reported they would have been confused. The Second Circuit disagreed with this reasoning, noting that Costco’s expert successfully raised the specter of “trained” responses and thus brought this factor into dispute. As to good faith, the District Court found this factor in Tiffany’s favor on the basis that Costco sought to have its suppliers provide rings that looked like Tiffany’s. The Second Circuit disagreed observing that under the law of the Second Circuit, the question of good faith is not whether Costco sought to sell jewelry that looked like Tiffany, but whether it sought to have its consumers believe they were purchasing Tiffany. On that basis, the Second Circuit found a genuine dispute on this factor, as Costco did not use the Tiffany trademark or its packaging and that it’s return policy allowed for fully refundable returns at any time. Rather, Costco used the Tiffany name to describe the setting style employed by Tiffany in its rings. Finally, as to the sophistication of the consumers, the Second Circuit found that it has been the recognized in that circuit that ring buyers, particularly the purchaser of a wedding or engagement ring, are among the most “discriminating in his [or her] purchase.” In assessing these factors together, the Second Circuit found that it was possible for a reasonable jury to conclude that Costco used “Tiffany” as a descriptor rather than a mark. This case demonstrates that claims of trademark infringement should not be taken at face value, and instead require a careful assessment by the court and the parties. Thanks to Benjamin G. Ferrell for the post. Please contact Vincent Terrasi with any questions or comments. Previous Next Contact

News PA Superior Court Finds That Employer Is Liable For Contribution Despite Not Being At Fault For Plaintiffs’ Injuries August 26, 2021 < Back Share to: In McLaughlin v. Nahata, et al., the Pennsylvania Superior Court found a hospital could seek indemnity or contribution toward a $17 million verdict rendered against it, from the employer of the doctors found liable for malpractice. Plaintiffs Alyssa McLaughlin and William McLaughlin sued two doctors over injuries Alyssa received while treating at The Washington Hospital (“TWH”). Plaintiffs also named TWH as a defendant. TWH joined The Dialysis Clinic, the doctors’ employer. Although the doctors performed the treatment that allegedly caused the injuries at TWH, the trial court found that The Dialysis Clinic was the doctors’ employer. Eventually, the doctors settled with the plaintiffs and TWH’s claims for contribution from The Dialysis Clinic were severed into a separate trial. The Dialysis Clinic claimed that it could not be held liable because it did not contribute to the injuries. The Superior Court disagreed. The court reasoned that the Pennsylvania Joint TortFeasors Act “does not limit the right of contribution to tortfeasors who have been guilty of negligence. Contribution is available whenever two [or] more persons are jointly or severally liable in tort, irrespective of the theory by which tort liability is imposed.” Although the theory of liability against The Dialysis Clinic was only through vicarious liability, the court reasoned that contribution was still available. Ultimately, the Superior Court remanded the case to the trial court because it found that the amount of liability to be apportioned to The Dialysis Clinic was a jury issue. Thanks to John Lang for his contribution to this post. Should you have any questions, please feel free to contact Tom Bracken. Previous Next Contact

News Fireworks Accident Only One Occurrence (PA) March 31, 2017 < Back Share to: In Hollis v. Lexington Insurance Company, a Pennsylvania federal court was faced with determining how many "occurrences" were triggered under an insurance policy, which can dramatically impact the amount of available coverage. Plaintiff Kathleen Hollis and her two children were injured during a fireworks show when a mortar unexpectedly was launched into the crowd. Plaintiffs alleged that the fireworks company, its president, and another employee committed 19 breaches of duty resulting in the injuries. Those breaches included negligently selecting and purchasing the fireworks, violating laws and regulations in the import of the fireworks, failing to test the fireworks before deployment, disregarding indications that the location for the fireworks show was unsafe, failing to set the crowd back at a safe distance from the launch area, negligently training employees, and other similar allegations. In the declaratory judgment action against Lexington Insurance Company, the Court was tasked with determining whether the allegations constituted a single occurrence, or as the claimants alleged, 19 separate occurrences under the fireworks company’s insurance policy to correspond with the number of duties that fireworks company allegedly breached. The insurance policy had a $1 million limit per occurrence and a $2 million aggregate limit. The insurer moved for summary judgment, saying that there was a single occurrence, and the injured claimants cross-moved. The trial court found in favor of the insurer, and the claimants appealed. On appeal, the Fourth Circuit found that Pennsylvania law applies a cause approach to defining what constitutes an “occurrence.” Under the cause approach, there is a single occurrence if there was one proximate, uninterrupted, and continuing cause which resulted in all of the injuries and damage. The Fourth Circuit noted that, regardless of the number of alleged negligent acts or victims, all the injuries had a single proximate cause — the misfired firework. Since all the injuries only had one cause, the Court affirmed the trial court’s decision and held that only one occurrence took place. Thanks to Jorgelina Foglietta for her contribution to this post and please write to Mike Bono for more information. Previous Next Contact

News Court Determines Discovery Needed on Alter Ego Defense (NY) January 6, 2017 < Back Share to: In Pringle v. AC Bodyworks & Sons, Inc., decedent was fatally crushed by an unmanned, flatbed truck that unexpectedly moved forward, pinning him against a wall. At the time, decedent was working on the truck as an auto detailer in the employ of AC Bodyworks & Sons, Inc. The truck was owned by defendant, AC Bodyworks & Sons, LLC. In September 2014, the administrators of decedent's estate applied for workers' compensation benefits and received an award for his work-related death. Thereafter, they commenced an action against, among others, AC Bodyworks & Sons, LLC, to recover damages for his wrongful death. AC Bodyworks & Sons, LLC moved for summary judgment asserting that the claim was barred by the exclusivity provision of Workers' Compensation Law § 11. Although documents established that AC Bodyworks & Sons, Inc. was decedent's employer on the date of the accident, AC Bodyworks & Sons, LLC contended it was also shielded from this action because it was a dissolved, predecessor entity that transferred "all ownership and operation of the business, including ownership of all business vehicles" to its successor, AC Bodyworks & Sons, Inc. The Supreme Court granted the motion, holding that this exclusivity provision extended to defendant and rejecting plaintiffs' contention that the motion was premature. On appeal, the court held that AC Bodyworks & Sons, LLC’s motion should have been denied as premature. "A determination as to whether two entities are alter egos of each other requires a far more detailed record than is present here.” Notably, defendant proffered no documentary proof of any transfer of assets between the two entities, while plaintiffs furnished admissible proof in the form of certified records from the Department of Motor Vehicles indicating that defendant obtained title to the truck 10 weeks after dissolution, and put new license plates on it 16 months after dissolution, and held title and registration on the date of the accident. As such, the court found that there were questions of fact as to whether the title and registration reflected administrative errors or, as suggested by plaintiffs, the continued operation of defendant as of the date of the accident. The court determined that discovery was needed to review decedent's employment records and documents substantiating the relationship between the two entities and the transfer of assets from defendant to AC Bodyworks & Sons, Inc., as well as deposition testimony. The decision was therefore reversed. Thanks to Paul Vitale for his contribution to this post and please write to Mike Bono if you would like more information.   Previous Next Contact