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September 2010
Texas Securities Litigation Addresses Liability Issue
Senior U. S. District Court Judge Royal Furgeson held in Billitteri v. Securities America, Inc., et al. (Provident Royalties Litigation), No. 09-cv-1568 (N.D. Tex. July 26, 2010), that seller liability under Section 33 of the Texas Securities Act (TSA) requires more than simply being in the chain of sale of a security sold by means of a material misrepresentation or omission. Wilson Elser attorneys successfully argued that point on behalf of their client, a securities broker-dealer. More.
September 2010
$7.5 million verdict upheld in ‘dual persona’ asbestos exposure suit
On August 20, 2010, the New Jersey Appellate Division affirmed a multimillion-dollar take-home asbestos verdict against Exxon Mobil in its role as a premises owner in the case Anderson v. A.J. Friedman, 2010 N.J. Super. LEXIS 173 (App Div). The plaintiff, who worked at one of Exxon’s facilities in New Jersey, had sued the company, claiming she developed the lung disease mesothelioma as a result of exposure to asbestos. There was evidence available that the plaintiff experienced dual, but separate, exposures to asbestos – as an employee of Exxon and/or as a spouse who laundered the work clothes of her husband, who also worked at Exxon. More.
August 2010
U.S. Supreme Court to review an important securities case that may open the door to fraud suits against service providers
The U.S. Supreme Court will hear a case that may expose service providers to lawsuits over alleged misstatements in securities prospectuses. The decision’s impact could extend beyond the investment management business to others who advise public companies concerning securities offering documents. That group likely would include accountants, attorneys, bankers, financial advisors and consultants. More.
August 2010
New York Court of Appeals clarifies scope of coverage for additional insureds
On June 3, 2010, the New York State Court of Appeals issued a decision in the case of Regal Construction Corp. v. National Union Fire Ins. Co. of Pittsburgh, Pa., in which it found that an additional insured clause in a policy of insurance provides coverage to an additional insured for activities which relate, even in very tangential ways, to the work being performed by the named insured on behalf of the additional insured. More.
July 2010
New York court addresses liability of professionals for a client’s fraud
Sticking one’s head in the sand may be a helpful way for an ostrich to avoid issues in life, but for professionals such as attorneys and accountants, this tactic can be risky. In a July 6, 2010, decision by the Appellate Division of the Supreme Court of the State of New York, First Department (the intermediary appellate court with authority over cases in Manhattan), the court sent a signal to professional services defendants that they may face expanded liability for the frauds perpetrated by their clients. More.
July 2010
Limits on California design professionals’ indemnity obligation in public contracts
In the recent cases of Crawford v. Weather Shield Manufacturing, (2008) 44 Cal. 4th 541, and UDC-Universal Development Company LP v. CH2M Hill, (2010) 181 Cal.App.4th 10, California appellate courts have upheld a design professional’s contractual defense obligation, even in the absence of any finding of negligence by the design professional. More.
July 2010
Employer asbestos defendant owes duty of care to families of employees
On June 10, 2010, the Fifth District Illinois Appellate Court ruled in Simpkins v. CSX Corporation and CSX Transportation that employers owe a duty to protect their employees’ immediate family members against take-home asbestos exposure even though no relationship exists between the employer and the family member. More.
July 2010
How new law affects life settlements in New York
The life settlement market has been a focus of attention in the life insurance industry over the last several years. A “life settlement” generally occurs when the owner of a life insurance policy sells the policy to a third party in exchange for a lump sum payment – the life insurance policy typically remains in force and the death benefit is paid to the beneficiary named by the new third-party owner. More.
July 2010
Connecticut Supreme Court upholds Graves Amendment in cases where a lessor leases an uninsured motor vehicle
In Rodriguez v. Testa (SC 18389), the Connecticut Supreme Court decided whether 49 U.S.C. § 30106, also known as the Graves Amendment, preempted state law imposing vicarious liability on the lessor of an uninsured motor vehicle for damages caused by the negligent acts of the lessee or the agent thereof. More.
June 2010
U.S. Supreme Court finds that COGSA governs liability of U.S. inland carriers transporting cargo under a “through bill of lading” issued by an ocean carrier
On June 21, 2010, the United States Supreme Court, three months following oral argument, issued its decision in the case of Kawasaki Kisen Kaisha Ltd et al. v. Regal Beloit Corp. (“Regal Beloit”). This is a seminal decision to the transportation industry, overruling a line of cases from the Second and Ninth Circuit Courts of Appeals that had imposed the Carmack Amendment’s higher liability regime upon motor and rail carriers for cargo damaged during the inland portion of shipments originating overseas, regardless of whether the shipment was being transported on a through bill of lading issued by the ocean carrier and was therefore arguably governed by the Carriage of Goods by Sea Act (COGSA). More.
June 2010
Preservation of electronically stored information (ESI)
In today’s litigation environment, evidence preservation responsibilities, particularly those concerning electronically stored information (ESI), seem to be constantly evolving. This process not only involves identifying key players, relevant time frames, and the metrics and locations of the information at issue, but also counseling sometimes unsuspecting clients about when preservation obligations attach and the consequences of not acting swiftly once a preservation trigger has been pulled. More.
June 2010
More certainty about “contract certainty”
When is an insurance policy a completed contract? Uncertainty as to whether an insurance contract is complete and in final form can lead to litigation among insurance carriers, brokers and policy holders. The New York Insurance Department recently supplemented its guidelines regarding "contract certainty" to aid licensees in avoiding such disputes. More.
June 2010
First Department clarifies New York law on the “Statutory Pollution Exclusion” and the merits of an insurer’s late notice defense in a pollution liability claim
In its May 20, 2010 decision in Travelers Indem. Co. v. Orange & Rockland Utils., Inc. (2010 NY Slip Op 04254) (ORU), the Appellate Division, First Department clarified the applicability of the so-called “Statutory Pollution Exclusion” and the merits of an insurer’s late notice defense in a pollution liability claim. More.
June 2010
Florida adopts UN arbitration model
Until recently, international arbitration in Florida was governed by the Florida International Arbitration Act (FIAA). However, the FIAA has now been repealed and replaced with the Model International Commercial Arbitration Law (Model Law), as drafted under the supervision of the United Nations Commission on International Trade Law. More.
June 2010
New Florida law raises burden of proof for claimants in slip and fall suits
Effective July 1, 2010, a claimant involved in a slip and fall lawsuit stemming from the presence of a foreign transitory substance will have to establish actual or constructive knowledge of the alleged dangerous condition on the part of the premises owner. More.
June 2010
The evolution of Bi-Economy: A note on potential consequential damages
It has been two years since the New York Court of Appeals decided Bi-Economy v. Harleysville Insurance (10 N.Y.3d 187 [2008]) and its companion case, Panasia Estates v. Hudson Insurance (10 N.Y.3d 200 [2008]). As distinct from claims for punitive damages for egregious bad faith (which is a tort claim), in these cases the Court of Appeals addressed the issue of the damages recoverable for breach of contract – specifically, for claims against insurers for breach of the implied covenant of good faith. More.
June 2010
Illinois Appellate Court holds rule of estoppel applies to “claims made and reported” policy conditions
A recent First District Appellate Court of Illinois decision makes it clear that insurers issuing “claims made and reported” policies in Illinois will be subject to the Illinois rule of estoppel, and that such insurers risk losing the right to enforce the reporting condition of such policies if they fail to take appropriate preemptive action. See, Uhlich Children’s Advantage Network v. National Union Fire Ins. Co., 2010 Ill. App. LEXIS 61 (1st Dist. February 3, 2010). More.
June 2010
Ninth Circuit finds coverage for patent infringement claim under advertising injury coverage within a general liability policy
The U.S. Ninth Circuit Court of Appeals recently ruled that an insurer owed a policy holder a defense under a general liability policy where the alleged patent infringement constituted “advertising injury” under the definitions of the policy. As this conclusion shows, the ever-changing nature of the Internet can give rise to a defense obligation in circumstances that may not be anticipated by an insurer, particularly those involving patents on novel technologies that are used by many modern businesses on their websites. More.
June 2010
Medicare Secondary Payer Act: New Jersey Appellate Court holds Medicare recovery rights not barred by collateral source statute or preempted by state law
Lending clarity to the increasing controversy surrounding Medicare’s recovery rights, the New Jersey Appellate Division, in an unpublished decision, has indicated a clear intent that Medicare’s recovery rights under the Medicare Secondary Payment Statute (“MSPS”) are not preempted by state law, nor does the New Jersey collateral source statute permit allocation of an award to damages other than medical expenses. More.
May 2010
Florida Supreme Court determines no bad faith by an insurer where it did not cause damages claimed by its insured, nor were damages incurred beyond the policy limit
Florida third party claimants may bring common law bad faith actions against insurers under limited circumstances, including the rendering of an excess judgment against an insured or by assignment. In a case recently determined by the Florida Supreme Court, Pamela Perera v. United States Fidelity and Guaranty Company, No. SC08-1968, the court, in essence, found that bad faith does not exist in a vacuum—that without the causation of damages, a carrier’s alleged bad faith conduct is not actionable.
May 2010
Georgia Supreme Court finds that, when insurer assumes defense under an ineffective reservation letter, insurer can be estopped from disclaimer based on noncoverage, even absent a showing of prejudice by insured
In World Harvest Church, Inc. v. GuideOne Mutual Insurance Co., 2010 Ga. LEXIS 365 (May 3, 2010), the Supreme Court of Georgia answered certified questions from the U.S. Court of Appeals for the Eleventh Circuit regarding the specificity required for an effective reservation of rights letter and whether an insured must show prejudice for an insurer to be estopped from denying coverage under Georgia law.
May 2010
Whether and when ‘English-only’ rules in the workplace are discriminatory
The population of the United States is becoming increasingly diverse. Recent surveys reflect that Hispanics currently comprise more than 15 percent of the population – more than 46 million people – making them the country’s largest minority group. As such, employers should make it a priority to become more knowledgeable about issues pertaining to Hispanic-Americans and other non-native English speakers in the workplace in order to avoid potential legal problems now and in the coming years. More.
April 2010
Important ruling on New York Workers’ Compensation Law for GSITs
A recent ruling by the New York Supreme Court, Albany County, in Held v. State of New York Workers’ Compensation Board regarding Group Self-Insured Workers’ Compensation Trusts is a decision that all providers of workers’ compensation insurance in New York should pay special attention to. In particular, the court addresses important issues of liability, constitutionality, and relatedness in connection to Group Self-Insured Trusts. More
April 2010
California court rules on equitable contribution in Scottsdale Insurance Co. v. Century Surety Co.
In Scottsdale Insurance Company v. Century Surety Company – B204521, the California Court of Appeal recently ruled that an insurance company seeking equitable contribution must establish that it paid more than its “fair share,” the proof of which would determine the amount of damages recoverable in such an equitable contribution action. The Court of Appeal also ruled that when an insurer contests a claim for equitable contribution based on a “prior work exclusion” in its policy, the insurer must prove that the exclusion is “conspicuous, plain and clear.” More.
April 2010
New York Insurance Regulation 194
New York Insurance Regulation 194 (“Regulation 194”), which will require insurance producers to disclose certain information concerning the compensation they receive for placing business, will take effect on January 1, 2011. While attempts are being made to challenge this regulation, these efforts may prove unsuccessful and/or the regulation may well go into effect before the matter is finally resolved. More.
April 2010
Oregon court allows discovery of confidential reinsurance reports in bad faith litigation: The Regence Group v. TIG Specialty Insurance Co.
In a much watched decision regarding the discoverability of reinsurance information, the District Court of Oregon recently denied a motion for reconsideration of its prior order finding such material discoverable and not cloaked by the attorney-client privilege or work product doctrine. The Regence Group v. TIG Specialty Insurance Co. Case no 07-1337-HA (USDC D. Or. Feb. 4, 2010). This ruling has troubling implications for cedents and their reinsurers, and it is a departure from well established precedent in other jurisdictions, notably California. More.
April 2010
Connecticut extends the limited duty rule to owners of hockey arenas
In Verneris v. Wang, Superior Court, judicial district of New Haven, Docket No. CV 07-5014070 (March 19, 2010, Keegan J.) a plaintiff brought suit against the Connecticut Islanders, LLC after being struck in the face by a hockey puck while attending a professional hockey match between the Bridgeport Sound Tigers and the Wilkes-Barre/Scranton Penguins. The plaintiff alleged that the Connecticut Islanders, LLC, as owners of the venue where the match took place, were negligent in failing to provide adequate protections for fans from the dangers of flying pucks. More.
March 2010
FINRA issues 2010 Annual Examination Priorities Letter
The Financial Industry Regulatory Authority (FINRA) conducts annual examinations of its member firms. These examinations are risk based and their frequency, scope and content will depend on the risk, scale and nature of a firm’s operations. On March 1, 2010, FINRA issued its 2010 Annual Examination Priorities Letter, which discusses the issues and topics that FINRA examiners will be focusing on in the upcoming year. More.
March 2010
Fifth Circuit grants en banc review in Comer, but recent administrative and legislative developments increase risk of climate change nuisance lawsuit
In several recent alerts, we have advised our clients of two federal appellate decisions, Connecticut v. American Electric Power Co., Inc. (582 F.3d 309 [2d Cir. 2009]) and Comer v. Murphy Oil USA (585 F.3d 855 [5th Cir. 2009]) that have allowed lawsuits seeking damages for global warming based on the federal common law of nuisance to go forward, and one district court decision, Native Village of Kivalina v. Exxon Mobil Corp. (663 F.Supp.2d 863 [N.D.Cal. 2009]) that has dismissed such a claim. More.
March 2010
First-in-the-nation statewide mandatory green building standards code; expected to generate future construction and design claims
On January 12, 2010, Governor Arnold Schwarzenegger announced that the California Building Standards Commission unanimously adopted the first-in-the-nation mandatory Green Building Standards Code (CALGREEN). These mandatory building regulations will apply to all new construction in California including, but not limited to, all residential and commercial buildings. The CALGREEN Code will take effect on January 1, 2011, and will become the baseline for regulating green construction statewide. More.
March 2010
Texas Court of Appeals adopts “chrysotile defense” as to specific causation in mesothelioma case
In a potentially far-reaching decision, the Texas Court of Appeals (Ft. Worth Division) recently held that a plaintiff’s failure to offer competent scientific evidence of the minimum exposure level of chrysotile asbestos necessary to increase the risk of mesothelioma entitled the defendant joint compound manufacturer to a summary judgment on the issue of specific causation. 2010 Tex. App. LEXIS 1367 (Feb. 25, 2010). More.
March 2010
“Personal injury” coverage and climate change liability: why policyholders may target this coverage in responding to climate change suits based on nuisance claims
In December 2009 and January 2010 Environmental Alerts, Wilson Elser reported on several recent federal court decisions concerning whether to allow private claims predicated on the federal common law of nuisance against parties whose greenhouse gas emissions have allegedly contributed to global warming. As reported in the previous alerts, the courts addressing this issue have reached conflicting conclusions as to whether such claims may stand. More.
March 2010
National Appellate Practice Group 2009 in Review
Skilled advocates, Wilson Elser’s appellate attorneys have earned the firm a reputation for excellence in post-trial and appellate work. Concentrating on the complex, highly technical, and constantly evolving discipline of appellate procedure, we have the experience needed to plan and execute the most effective post-trial and appellate strategy. In addition to handling appeals, we provide critical assistance at the trial level, including consultation on the preparation of dispositive pre-trial motions, motions in limine, and jury instructions; participation at trial; and attendance at the jury instructions conference. More.
March 2010
Supreme Court upholds the “nerve center” test to determine a corporation’s “principal place of business” for the purposes of diversity jurisdiction and rejects the Ninth Circuit’s amount of “business activities” test
On February 23, 2010, the United States Supreme Court in Hertz Corp. v. Friend, et. al., unanimously held that a corporation’s “principal place of business” for the purposes of federal diversity jurisdiction shall be determined by the “nerve center” test. This refers to the corporation’s center of direction, control and coordination, as opposed to the “business activities” test used in the Ninth Circuit and elsewhere. More.
March 2010
Second Circuit finds that New York notice requirements inapplicable to disclaimers based on coverage grant of the policy
Where an insurer’s disclaimer of coverage is not based on a policy exclusion, but rather on the basis that no coverage exists in the first instance, must the carrier still comply with the stringent notice requirements of New York Insurance Law § 3420(d)(2)? No, said the Second Circuit in its recent ruling in <EM>NGM Insurance Company v. Blakely Pumping, Inc. More.
February 2010
Utah advises brokers to follow state law in FINRA arbitrations
What law governs disputes that are subject to binding arbitration in the Financial Industry Regulatory Authority (FINRA)? The State of Utah has advised securities broker-dealers doing business there that they expect FINRA arbitrators to apply Utah’s Uniform Securities Act in deciding issues of liability and damages. The Act allows investors to recover the amount they paid to purchase the securities at issue, plus 12% annual interest, costs, and reasonable attorneys’ fees, less any income received from the securities. More.
February 2010
Illinois strikes down verdict caps
On February 4, 2010, the Illinois Supreme Court, by a 4-2 ruling, invalidated an Illinois statute which established caps on the amount of non-economic damages such as; pain, disfigurement and loss of consortium, that can be recovered in medical malpractice actions. In reaching its determination in Lebron v. Gottlieb Memorial Hospital (Ill. Supreme Court Docket Nos. 105741, 105745), the court determined that the statute violated the separation of power provisions stated in the Illinois Constitution by nullifying the court’s inherent power to correct excessive jury awards. More.
February 2010
Florida: Should plaintiffs pay for frivolous suits?
Parties, but not their attorneys, could be spared sanctions for frivolous litigation if they do not understand their cases were baseless under House Bill 449, which cleared the Florida House of Representatives Civil Justice and Court Committee in January 2010. More.
January 2010
Opinion in Pension Committee v. Banc of America is destined to change the e-Discovery landscape
Anyone with even a passing familiarity with the duty to preserve and produce electronically stored information (ESI) in U.S. litigation is well-aware of the pivotal series of Zubulake v. UBS decisions written by U.S. District Court Judge Shira A. Scheindlin of the Southern District of New York in 2003 and 2004. Shortly after those opinions were issued, the Federal Rules of Civil Procedure were amended to include specific ESI provisions. More.
January 2010
Global warming litigation: Native Village of Kivalina
Following our December 2009 advisory, “The Application of Nuisance Law to Greenhouse Gas Emissions,” this is the latest in a series of client advisories concerning climate change-related liability.
Plaintiffs who had made claims for alleged global warming damages received a recent setback in the Northern District of California U.S. District Court. In Native Village of Kivalina et al vs. ExxonMobil Corporation et al. ((2000 N.D. Cal) 2009 U.S. Dist Lexis 99563), Judge Saundra Brown Armstrong granted a motion to dismiss the complaint filed against 24 oil, energy and utility companies alleging that their greenhouse gas emissions created a public nuisance and contributed to climate change brought on by global warming. This decision focuses on the fundamental problems with such claims and foretells a potential split between federal circuits and an issue that will ultimately need to be decided by the United States Supreme Court. More.
January 2010
California’s Fourth Appellate District upholds land subsidence exclusion in a Commercial General Liability (CGL) policy
A recent decision by the Fourth Appellate District of the California State Court of Appeal, City of Carlsbad v. Insurance Co. of the State of Pennsylvania (2009 Cal.App. LEXIS 2025), has upheld a land subsidence exclusion to a CGL insurance policy, finding that the exclusion, which precludes coverage for “property damage arising out of land subsidence for any reason whatsoever,” is not ambiguous and does not violate Insurance Code Sec. 530. This published decision should prove to be extremely useful to insurers seeking to assert such exclusions upon tender of a third-party landside claim. More.
January 2010
Rollout of updated policies with the new year
After the frenzy of the holiday season, January is the perfect time to reassess employment policies. This includes making modifications to comply with changes in the laws and implementing any updates appropriate for the ever-changing needs of the workplace. More.
January 2010
“That’s what friends aren’t for,” says Florida ethics panel
On November 17, 2009, Florida’s Judicial Ethics Advisory Committee concluded that judges should not be Facebook friends with attorneys who appear before them. The State Committee said “‘friending’ someone on Facebook poses an appearance of conflict and could lend the weight of the robe to others.” Judicial Canon 2B strictly prohibits judges from doing anything that might “lend the prestige of judicial office to advance the private interests of the judge or others.” The ruling did not address Facebook in particular but, instead, referred to all social networking sites by noting that the primary problem was allowing others to see who someone’s friends are. More.
January 2010
Statement on Auditing Standards – Consideration Of Fraud In A Financial Statement Audit – Slated For Review By The Auditing Standards Board
The Auditing Standards Board (“ASB”) of the American Institute of Certified Public Accountants (“AICPA”) will review the exposure draft of the proposed Statement on Auditing Standards (“SAS”), Consideration of Fraud in a Financial Statement Audit, at its January 2010 meeting as part of the continuing Clarity Project. More.
December 2009
The House approves the Wall Street Reform and Consumer Protection Act
On Friday, December 11, 2009, the U.S. House of Representatives approved H.R. 4173, the Wall Street Reform and Consumer Protection Act, a bill aimed at tightening the federal regulation of Wall Street financial institutions and banks, and increasing consumer protections in the wake of the financial crisis that devastated the economies of the United States and other leading financial markets. The bill is representative of the Obama Administration’s efforts at overhauling the regulation of the financial sector, and is one of the first major initiatives since the stimulus package passed during the peak of the crisis. More.
December 2009
The application of nuisance law to greenhouse gas emissions
This is the latest in a series of client advisories concerning climate change-related liability.
In two recent decisions, the U.S. Courts of Appeals for the Second and Fifth Circuits have held that climate change lawsuits based on the common law of nuisance may proceed. Although the principal issues before the courts in each case were standing and justiciability, the courts’ acceptance of the notion that the principles of nuisance law may give rise to liability for greenhouse gas emissions is telling, and may make it more likely that significant litigation on that basis will follow. The breadth of the courts’ analyses further suggests that future claims may not be limited to major emitters, and that liability for damages allegedly resulting from climate change may follow. More.
December 2009
EPA lead law to impose new requirements on contractors and landlords
The U.S. Environmental Protection Agency (EPA) has enacted the Renovation, Repair and Painting (RRP) Rule, developed under the Toxic Substances Control Act, going into effect on April 22, 2010, which imposes a new set of requirements for contractors and property owners and managers who renovate, repair or prepare surfaces for painting in pre-1978 rental housing or space rented by child care facilities. More.
November 2009
Caretaker coverage extended under new law
Recently, President Barack Obama signed into law the National Authorization Act for Fiscal Year 2010, which extends military caregiver leave provisions to veterans. Under the new law, a worker will be able to take up to 26 weeks of leave from employment to care for a veteran for up to five years after the service member leaves the military. The leave could be taken by the caregiver if the veteran suffered a qualifying injury or illness in the line of active duty (or had an existing injury or illness aggravated in the line of active duty). The injury or illness could manifest itself before or after the service member became a veteran. More.
November 2009
Appellate Alert
Wilson Elser’s Appellate Practice Group has recently made new law in Illinois with respect to pleading causes of action for defamation per se. In Green v. Rogers, --- N.E.2d ---, 2009 WL 3063399 (Ill. Sept. 24, 2009), Group Co-Chair Melissa A. Murphy-Petros (Of Counsel-Chicago) convinced the Illinois Supreme Court to hold, as a matter of first impression, that such claims must be pled with the same specificity and particularity as that required in pleading fraud claims. This ruling not only secured dismissal of the complaint against Wilson Elser’s client, but also established new law favorable to defamation defendants throughout the state. More.
November 2009
Broad application of in pari delicto defense results in summary judgments for Grant Thornton in Parmalat case
An old defense to claims brought by clients and former clients has been renewed and given broad application to end litigation against affiliates of the former client’s auditors. U.S. District Judge for the Southern District of New York Lewis Kaplan ruled, on September 18, 2009, that all claims brought by the plaintiffs, Dr. Enrico Bondi, (“Bondi”), the Extraordinary Commissioner of Parmalat Finanziaria, S.p.A., Parmalat S.p.A., and their affiliates (jointly “Parmalat”) in Italian reorganization proceedings, and Parmalat Capital Finance Limited, a subsidiary of Parmalat (“PCFL”), against defendants Grant Thornton International (“GTI”) and Grant Thornton LLP (“GT-US”) were barred under the in pari delicto defense. More.
October 2009
Enforceability of website Terms of Use notice at bottom of home page called into question
In a decision recently issued in the Eastern District of New York, a court has questioned the enforceability of a website Terms of Use document that does not require a user to “click through,” and is only noticed in a small link at the bottom of a long scroll-page. The case, Hines v. Overstock.com, Inc., 09-cv-00991 (EDNY 2009), denied Overstock.com’s request to stay litigation for arbitration, as it held that the plaintiff had not assented to the arbitration clause in Overstock.com’s website Terms of Use due to a lack of sufficient notice. More.
October 2009
Firms must comply with FTC “Red Flags” data protection rule, starting November 1, 2009
The Federal Trade Commission’s “Red Flags” Rule is designed to protect personally identifiable information from data thieves. Insurance brokerage firms and other service providers that receive payment after their services have been delivered are required to comply. The compliance deadline is November 1, 2009—data breaches on or after that day may be subject to penalties of up to $3,500 per violation, and could also result in prosecution for violation of state consumer protection or deceptive trade practices laws. Such laws may permit private individuals to sue and recover treble damages, attorney’s fees and/or litigation costs. More.
October 2009
Connecticut Legislature approves pre-suit policy disclosures
The Connecticut Legislature recently enacted an act requiring disclosure of automobile liability insurance policy limits prior to the filing of a claim. Public Act 09-240, effective October 1, 2009 and applicable to all claims arising on or after that date, requires an automobile liability insurer to disclose the limits applicable under a policy it issued within 30 days after receiving a written request for disclosure. More.
October 2009
A role for the federal government in insurance regulation attracts additional support
During its Fall National Meeting, the National Association of Insurance Commissioners’ (“NAIC”) Government Relations Leadership Counsel (“GRLC”) approved for submission to Congress the Reinsurance Regulatory Modernization Act of 2009 (the “Act”), which would modernize the regulation of reinsurance by state insurance regulators. The Act is intended “to facilitate cross-border reinsurance transactions and to enhance competition within the U.S. market, while ensuring that U.S. insurers and policy holders are adequately protected against the risk of insolvency,” according to a statement by Roger Sevigny, New Hampshire Insurance Commissioner and President of the NAIC. More.
October 2009
Accounting firms must comply with FTC “Red Flags” Rule by November 1, 200
The Federal Trade Commission’s “Red Flags” Rule is designed to protect personally identifiable information from data thieves. Among others, the Red Flags Rule applies to any business or individual that provides a product or service for which payment is received after the product or service is delivered. While many might assume that data protection regulation applies only to hospitals and banks, the broad definition of who is covered by the Red Flags Rule very clearly applies to professional services firms that get paid by their clients after the services are provided, which, of course, includes accounting firms. More
September 2009
Delaware decisions reduce hurdles to defending D&O claims
A typical claim targeting directors and officers (“D&Os”) in the context of a merger or acquisition is that the D&Os breached their fiduciary duties of care and loyalty by failing to get the best deal for shareholders. However, in a boon to D&Os and their insurers, several recent Delaware court decisions have made it easier for defendants to successfully defend these types of claims. More.
September 2009
Premises Liability Alert - Florida appellate court finds that third-party contribution claims are obsolete
A recent Florida case may have a dramatic impact on the way that defendants and defense counsel handle claims in which a third party may be partially or entirely liable for the claimant’s damages. See T & S Enterprises Handicap Accessibility Inc. v. Wink Industrial Maintenance and Repair, Inc., 34 Fla. L. Weekly D953 (Fla. 2d DCA May 13, 2009). The court in T & S answered the question of whether the right of contribution continues to exist following the 2006 statutory abolition of joint and several liability. More.
August 2009
Environmental Alert - Be aware of open-ended remediation contracts
In today’s tough economic times, many municipalities are seeking to enter into contracts with insurers for the environmental remediation of contamination caused by an insured’s negligence, i.e. an excavating company. Often, these agreements seek to saddle insurers with open-ended responsibility for remediation work. As discussed below, insurers can avoid these types of agreements and still provide the remediation that the municipality is seeking. More.
August 2009
Environmental Alert - Site Remediation Reform Act
A significant change has come to the process of environmental investigations and cleanups in New Jersey with the March 16, 2009, passage by the New Jersey State Senate and Assembly of a highly important piece of legislation – the Site Remediation Reform Act (S.1897/A.2962) (the “SRRA”). On May 7, 2009, Governor Corzine signed the SRRA into law. This new law will dramatically change the site remediation process in New Jersey, as well as the role of the New Jersey Department of Environmental Protection (“NJDEP”) and environmental consultants. More.
August 2009
Governor Paterson announces administration appointments
Governor David A. Paterson appointed James J. Wrynn as New York State Superintendent of Insurance and Wendy Saunders as Deputy Secretary for Health, Medicaid and Oversight. The Governor also announced the appointments of Kristin Proud as Deputy Secretary for Human Services, Technology and Operations and Senior Advisor to the Office of Taxpayer Accountability as well as Mark Leinung as Deputy Director for State Operations. More
August 2009
New Medicare reporting guidelines apply to all liability insurers and self-insureds, but will they be enforceable against alien (non-U.S.-admitted) carriers?
As we reported in an Insurance Alert on April 30, 2009, and as further elaborated in an article by Frederick J. Pomerantz (Partner-NY), that appeared in Vol. 20 Edition 2 - Summer 2009 of the FORC Journal, a publication of the Federation of Regulatory Counsel, Inc., the “Medicare, Medicaid, and SCHIP Extension Act of 2007” (the “Act”) amends the Medicare Secondary Payer Act (MSPA), imposing significant new reporting obligations upon insurers and others subject to it. Significantly, if an insurer fails to notify Medicare in accordance with the new reporting guidelines, a civil penalty of $1,000 per day may be assessed per claimant. The new legislation clearly indicates a shift in federal policy that will result in the federal government monitoring recoveries in tort claims more closely to minimize costs to Medicare. More.
August 2009
Data Security and Privacy Alert Update - Commencement of Red Flags enforcement by FTC postponed to November 1, 2009
On July 29, 2009, the Federal Trade Commission (“FTC”) announced that the implementation of the “Red Flags” rule, requiring most businesses to adopt a written data security and breach policy, has been postponed by three months, to November 1, 2009. The FTC has cited the need to assist and educate small businesses with low risk of security breaches regarding the required conduct under the rule. Businesses now have additional time to prepare for the impact of the rule by bringing their companies or practices into compliance with the rule’s requirements. More
July 2009
Intellectual Property Alert - Jury awards record labels $1.9m for defendant’s sharing of 24 songs online
On June 18, 2009, a verdict was returned in the case of Capitol Records, et al. vs. Jammie Thomas-Rasset finding a private individual guilty of copyright infringement for sharing 24 songs on a popular file sharing network. In the first case brought by the recording industry to go to a jury, the plaintiff was awarded $80,000 in damages per song, totaling $1.92 million. More
July 2009
Employment Alert - Swine Flu and the Americans with Disabilities Act
Concern over spread of the H1N1 flu virus (“swine flu”) in the workplace does not relieve employers of their obligations under employee protection laws, including the federal Americans With Disabilities Act (ADA). Indeed, as the Equal Employment Opportunity Commission (EEOC) recently noted, swine flu raises a number of potential disability discrimination issues of which employers must be aware. More.
July 2009
Insurance Alert - IAIS strengthens supervision of large, multi-national insurance and reinsurance companies
On June 17, 2009, President Obama announced a Financial Regulatory Reform U.S. Plan (“U.S. Plan”) which is designed to overhaul the financial regulatory system by, among others, creating a systemic risk regulator, enhancing the roles of existing federal regulators, and creating a consumer protection agency. The U.S. Plan was well received by the National Association of Insurance Commissioners, as well as by several insurance and banking trade groups. More.
June 2009
Insurance Alert - Florida legislature reaffirms exemption for surplus lines carriers
Whereas domestic insurers are regulated by Chapter 627 of the Florida Statutes, it was assumed that this chapter did not apply to surplus line insurers. Following two 2008 court rulings in Florida, which created an ambiguity as to how many surplus lines insurers are regulated in contrast to domestic insurers, the Florida Legislature passed House Bill 853 during the 2009 Legislative Session, which was signed into law by Governor Charlie Crist on June 11, 2009. More.
June 2009
Insurance Alert - Proposed amendments to NY Regulation 41 (excess lines) and the impact on declination rules and requirements
The proposed Eleventh Amendment to New York Insurance Department Regulation 41 (11 N.Y.C.R.R. 27.0 et seq.) would expand New York’s “export list,” making it easier to purchase certain coverages that have been largely unavailable in the admitted market by expanding the “no declinations” rule to those lines of insurance. More.
June 2009
Accountants Alert - BDO International escapes liability for mistakes of member firm
In a case closely watched by the accounting profession, a jury took only one hour to render a verdict in favor of BDO International (now known as BDO Global Coordination B.V.), saving that company, the umbrella organization of the BDO network, from huge vicarious liability for the acts of one of its member firms, BDO Seidman. More.
June 2009
Securities Alert - Potential impacts from the proposed changes to the regulation of the financial industry and the federal securities laws
In an effort to protect our clients’ current and future interests, the existing rules and regulations in place and any proposed changes which could have an impact on business practices should be recognized and evaluated. On June 17, 2009, the Treasury Department and the White House released their proposed changes to the regulation of the financial industry entitled, Financial Regulatory Reform: A New Foundation (the “Proposal”). The Proposal could have a dramatic effect on how our clients manage their business and litigation. More.
June 2009
Asbestos Alert - Premises liability asbestos defendant is not liable for second-hand exposure
Second-hand or bystander asbestos exposure litigation has been increasing in Illinois, but a recent Illinois Appellate Court opinion has held that premises defendants cannot be found liable under a second-hand exposure theory. On May 29, 2009, the Second District Appellate Court ruled in Nelson, et al. v. Aurora Equipment Company, in a case of first impression, that an asbestos defendant is not liable for alleged asbestos injuries under the theory of premises liability to a plaintiff who was never present on the defendant’s premises. More.
June 2009
Accountants Alert - Inattention to engagement letter details leads to potential exposure for otherwise time-barred claims
Carefully crafted engagement letters are one of the best risk management tools for accountants. The use of engagement letters across the broad and growing spectrum of services accountants provide is, however, sometimes uneven. The result can be disastrous. More.
June 2009
Securities Alert - Notable FINRA Rule Changes
There have been several recent amendments to current FINRA rules, which impact broker-dealers and associated persons in the securities industry. Some amendments are favorable, such as the increase in the threshold for customer complaint reporting, whereas the amendment requiring Form U-4 disclosure for all arbitrations and civil actions, even when the broker has not been named will negatively impact brokers. Regardless of its impact, the following rule changes are important and our clients should be aware of them. More.
June 2009
Data Security and Privacy Alert - Red Flags Rule Enforcement by FTC Begins August 1, 2009
The Red Flags Rule is designed to protect personal identifiable information from data thieves. While many people believe that data protection regulation applies only to hospitals and banks, data thieves are attacking other businesses, so regulation has expanded. More.
June 2009
Latin America Alert - Mexico imposes retaliatory tariffs on U.S. goods in response to suspension of NAFTA trucking program
The Mexican government recently imposed import tariffs on $2.4 billion of U.S. goods after the United States suspended a program allowing Mexican trucks to deliver goods across the border. When the U.S. closed the southern border to Mexican trucking in March, Mexico promised to retaliate. Mexico has released a list of 89 U.S. products that will face tariffs of 10 percent to 45 percent. More.
May 2009
Insurance Alert - Increased e-Discovery Challenges for Insurers & Claims Representatives
In December of 2006, the procedural rules changed in the United States federal courts to mandate very early discussions concerning the preservation and discovery of electronically stored information (ESI). Since that time, 23 states have enacted e-Discovery provisions to their civil rules, and another 12 are considering such provisions. These changes in the ground rules by which the discovery phase of U.S. litigation takes place mirror the explosive growth of ESI issues dealt with by our courts. More.
May 2009
Insurance Alert - California Supreme Court rules on the effect of concurrent causation in coverage cases involving indivisible damage from pollution
In its March 9, 2009 ruling in State of California v. Underwriters at Lloyd's London et al. (S149988) (“Underwriters”), the California Supreme Court, which is the highest court in that state, handed down a significant ruling for insurers and insureds litigating coverage for environmental pollution. More
May 2009
Insurance Alert - Emerging coverage issues of new EPA-proposed climate change regulation
The risks that the insurance industry as a whole, and liability insurers in particular, face are being altered by climate change. Experts may debate the scope of investment that the world needs to make to combat global warming, but the forecasts are all measured in trillions of dollars. More.
May 2009
Environmental Alert - Federal efforts to reduce greenhouse-gas emissions
On April 17, 2009, the Obama administration’s Environmental Protection Agency (“EPA”) issued two proposed findings regarding the following greenhouse gases (“GHGs”): carbon dioxide; methane; nitrous oxide; hydrofluorocarbons; perfluorocarbons; and sulfur hexafluoride. More.
April 2009
Insurance Alert - New Medicare guidelines impose enhanced reporting duties upon liability insurers and self-insureds, with severe penalties for non-compliance
On December 29, 2007, then-President George Bush signed into law the "Medicare Medicaid, and SCHIP Extension Act of 2007" (MMSEA). Beginning July 1, 2009, MMSEA amends the Medicare Secondary Payer Act (MSPA), imposing significant new reporting obligations upon insurers and others subject to it for all claims that involve medical costs subject to Medicare. More
April 2009
Asbestos Alert - Nolan v. Weil-McLain decision changes legal landscape
On April 16, 2009, the Illinois Supreme Court issued its long-awaited decision in Nolan v. Weil-McLain, providing some relief to defendants who have been barred from introducing evidence of other asbestos exposure. More
April 2009
Eighth Circuit concludes that decision in Abram v. Cargill, Inc.does not apply under new ERISA regulations
In Midgett v. Washington Group Int'l Long Term Disability Plan, __ F.3d __, 2009 WL 996682 (8th Cir. April 15, 2009), the Eighth Circuit considered the amended ERISA claim regulations in deciding whether a claimant received a "full and fair review" of the denial of benefits. The court ultimately agreed with the Tenth and Eleventh Circuits and concluded that a plan is under no obligation to provide a claimant with copies of reports obtained during the appeal so they may comment on them prior to a final decision. More.
April 2009
Third Circuit provides useful interpretation of New Jersey regulation on “discretionary” clauses in insurance contracts
In Evans v. Employee Benefit Plan, 2009 U.S. App. LEXIS 3426, 2209 WL 418628 (3d Cir. N.J. Feb. 20, 2009), the Third Circuit Court of Appeals affirmed the New Jersey District Court's decision that the insurance carrier did not abuse its discretion in denying the claimant’s long term disability claim. This decision should prove useful in cases in which a claimant under a life, health or disability policy seeks to use New Jersey ’s regulatory ban on so-called “discretionary” clauses in such policies. More.
April 2009
Connecticut high court clarifies rules for interpreting policy exclusions
In its March 24, 2009, decision in Liberty Mutual Ins. Co. v. Lone Star Industries, Inc. et al., 290 Conn. 767 (2009), the Connecticut Supreme Court clarified Connecticut law concerning the interpretation of exclusions in insurance policies. More
April 2009
New York Appellate Court Provides Guidance on Rules Concerning Constructive Waiver of Late Notice Defense and Proving the Content of a “Lost” Renewal Policy
In its recent ruling in Estee Lauder v. OneBeacon (2009 NY Slip Op 01313, Feb. 19. 2009), New York's Appellate Division First Department confronted significant issues of New York law regarding the constructive waiver of a late notice defense and proving the material terms and conditions of a "lost" or disputed renewal policy. More
March 2009
U.S. Supreme Court rules no federal preemption for prescription drug labels
In a long-awaited decision, on March 4, 2009, in Wyeth v. Levine, the United States Supreme Court found by a 6 to 3 vote, that the Food and Drug Administration's approval of a warning label on a prescription drug did not preempt state law tort claims. More.
March 2009
New rulings by Florida courts create uncertainty about regulation of surplus lines insurers
Two recent court rulings in Florida have resulted in ambiguity as to how much surplus lines insurers are regulated in contrast to domestic insurers. Whereas domestic insurers are regulated by Chapter 627 of the Florida Statutes, it was assumed that this chapter did not apply to surplus line insurers until these court rulings indicated otherwise. Legislation has now been introduced in the Florida House of Representatives and Florida Senate that provides that surplus lines insurers are exempt from all of Chapter 627. More.
March 2009
Insurance Alert - Illinois and Wisconsin high courts apply “time and space” considerations in quantifying the number of occurrences
Recent rulings from the Supreme Courts of Illinois and Wisconsin demonstrate that these states have joined the increasing number of jurisdictions that have applied "time and space considerations" in quantifying the number of occurrences in claims involving multiple losses. More.
February 2009
Vicarious Liability Claims To Proceed To Trial: When Can an International Accounting Organization be Held Liable for the Acts of a Member Firm?
In a recently issued decision, a federal trial court applied traditional rules of vicarious liability and concluded that issues of fact existed as to whether an international accounting organization might be held liable for the acts of one of its members. Accordingly, a case that could have significant effects on the structure and management of accounting organizations, and potential liability, will now proceed to trial. More.
February 2009
Securities Arbitration in FINRA: A Guide to What Every Securities Broker Needs to Know
Securities brokers, financial planners and other professionals are facing serious repercussions from the current Credit Crisis and downturn in the economy in the form of increased and widespread investor claims. It would benefit these professionals to understand the Financial Industry Regulatory Authority (FINRA) arbitration process in order to better manage risk and prevent future claims, to bring disputes to early and economical resolutions, and to fully defend matters that should be contested on the merits. Looking ahead, 2009 may be a record-setting year for new FINRA claims due to the generalized bear market. More.
February 2009
New multinational counter-piracy task force established
The Combined Maritime Forces, consisting of more than 20 nations, announced on January 8, 2009, the creation of a new Combined Task Force (151) specifically established for counter-piracy operations in the Gulf of Aden, the Gulf of Oman, the Arabian Sea, the Red Sea and the Indian Ocean. The force, consisting of naval vessels, aircraft and other assets, became operational during January 2009 and is commanded by U.S. Navy Rear Admiral Terence McKnight. More.
February 2009
Lilly Ledbetter Fair Pay Act extends filing deadlines for pay-bias complaints:
With the recent signing of the Lilly Ledbetter Fair Pay Act, President Obama effectively overturned a U.S. Supreme Court ruling in 2007 that severely restricted the amount of time an employee had in which to assert a pay discrimination claim. An employee can now file a complaint of pay discrimination long after learning of any pay discrepancy. More.
February 2009
Long awaited revisions to the education law mean additional obligations and opportunities for the New York accountant
Governor David A. Paterson signed a bill on January 27, 2009, that imposes significant additional regulations upon accountants practicing in the State of New York. The bill amends the Education Law of New York applicable to the practice of accountancy in the state and becomes law six months from now. The new amendments will impact nearly all who practice within New York and, potentially, open the door for reciprocity with other states. More
January 2009
Revised regulations for greater taxpayer protection create additional duties and considerations for accountants
The Treasury Department and the Internal Revenue Service have issued new regulations providing taxpayers improved safeguards and greater control over their tax return information held by tax return preparers. These new regulations create additional obligations for tax preparers and continue to impose criminal and civil liability for failure to adhere to those obligations.
January 2009
FINRA announces special arbitration procedures for investors seeking recovery of consequential damages for auction rate security losses
Through the end of November 2008, two hundred seventy-five (275) matters have been filed with the Financial Industry Regulatory Authority (“FINRA”) seeking the recovery of consequential damages related to auction rate securities. On December 16, 2008, FINRA announced a Special Arbitration Procedure (“SAP”) designed to provide swift resolution and reduced costs for investors seeking to recover consequential damages related to auction rate securities against broker-dealers who entered into auction rate security settlements with FINRA or the SEC.
January 2009
Ninth Circuit provides new standard for reviewing (some) conflict of interest evidence on ERISA motion for summary judgment
The Ninth Circuit, in Nolan v. Heald College , et al., 9th Circuit Docket No. 07-15679 (January 13, 2009), revisited the standard a U.S. District Court should apply when reviewing evidence of a conflict of interest on a motion for summary judgment in ERISA litigation. More specifically, the court addressed the standard for evidence submitted from outside the administrative record in a matter being reviewed under the abuse of discretion standard.
January 2009
Florida joins growing number of jurisdictions that have invalidated pre-injury releases signed by parents on behalf of their minor children
Recently the Florida Supreme Court in Kirton v. Fields, 2008 WL 5170603 (Dec. 11, 2008) held that a parent cannot enter into a binding pre-injury release on behalf of a minor who is participating in a commercial activity. The court’s ruling stemmed from a 2003 accident involving a 14 year old boy who was fatally injured while operating an ATV at an off-road motor-sports park. In order to gain admission to the park, the father, who was the primary custodial parent, had to execute a release and waiver of liability. Following the fatal accident the personal representative of the child’s estate filed a wrongful death lawsuit against the park’s operators.
January 2009
Indemnification provisions in client engagement letters: Old tool given new life for limiting liability of accountants
As we have repeatedly advised, carefully tailored engagement letters are of growing importance in reducing accountants’ liability exposure. There are numerous provisions incorporated in an engagement letter, some of which can protect the accountant from liability, both from the client and third parties. However, until recently, it was unclear if one of the most important contractual provisions would be enforced if placed in an accountant’s engagement letter: an indemnification and hold harmless provision.
December 2008
Product safety legislation update
The Consumer Product Safety Improvement Act of 2008 (CPSIA) went into effect in August. Wilson Elser reported on this new legislation and provided a forecast as to some of the more troubling aspects of this legislation and its anticipated consequences to various business interests. Recently, the Federal Register published the final rule changes to the CPSIA. The CPSIA enhances the Consumer Product Safety Act (CPSA) and, among other things, conveys new enforcement obligations and authority to the U.S. Consumer Product Safety Commission (CPSC).
December 2008
Navigating the Madoff mess
In the economic and investment world, 2008 certainly will go down as the year of “crisis.“ Arguably, the pinnacle will be the allegation that Bernard L. Madoff Investment Securities LLC was a ponzi scheme in which thousands of investors may have lost upwards of $50 billion. The categories of investors involved runs the gamut from individuals to pension plans to charitable foundations.
December 2008
Illinois Supreme Court rules that settling defendants are not to be included in the jury’s allocation on fault
The Illinois Supreme Court in Ready v. United/Goedecke Services, Inc., 2008 WL 5046833 (Nov. 25, 2008), resolved a question that is of critical importance to any defendant sued in that state. Where the plaintiff sues multiple defendants and settles with one or more before trial, may the fault of the settling defendants be considered by the jury for purposes of allocating fault to the remaining defendants? A divided Supreme Court has unfortunately answered “no.”
December 2008
International Law Alert
California Supreme Court issues ruling in Manco Contracting Co. v. Krikor Bezdikian clarifying key terms of California ’s Uniform Foreign Money Judgments Recognition Act More
December 2008
Non-statutory employment claims still subject to arbitration under the amended NASD Code
In possibly one of the first cases since the implementation of the revised NASD Code of Arbitration Procedure (“NASD Code”), the Supreme Court of Texas has issued a per curiam ruling concluding that an employee’s non-statutory employment claim is subject to the mandatory arbitration provision of the NASD Code. This may be the first case in the United States to address whether common law employment actions are still arbitrable under April 2007 amendments to NASD’s Code of Arbitration Procedure. More
November 2008
Handling the large loss fire: An overview
In 2006, about 3,675 civilians and 106 firefighters lost their lives as the result of fire, and there were 16,400 civilian injuries. Fire killed more Americans than all natural disasters combined. Although 1.6 million fires were reported, many others went unreported, causing additional injuries and property loss. Direct property loss due to fires was estimated at $11.3 billion. Of these fires, 50 percent were outside and other fires, 31.9 percent were structure fires and 18.1 percent were vehicle fires. Residential fires represented 24.7 percent of all fires and 77.5 percent of structure fires. More
November 2008
Wilson Elser National Fire & Casualty Response Team
In these tough economic times, the importance of responding to the notification of a fire loss when your company or insured is a potential target has never been more important. With the advent of the National Fire Protection Association’s 921 Guide for Fire and Explosion Investigations, courts have recognized greater responsibilities of property owners and their insurers to provide adequate notice to interested parties that they may bear legal responsibility for a fire loss. More
October 2008
Insurance Alert
Illinois Supreme Court lets stand groundbreaking insurance coverage decision obtained by Wilson Elser team
October 2008
Wilson Elser’s Appellate Practice Group makes new law in New York State
Wilson Elser's Appellate Practice Group makes new law in New York State
September 2008
Marine Alert
United States imposes new sanctions against Iranian carrier and urges marine insurers and reinsurers to implement existing sanctions
August 2008
Product Liability Alert - Product Safety Legislation Update
In the wake of a record-setting year for product recalls and widespread criticism of the U.S. Consumer Product Safety Commission's ability to protect consumers from dangerous products, Congress has enacted the Consumer Product Safety Improvement Act of 2008 (CPSIA). President Bush is expected to sign this legislation into law in the near future. The new legislation revamps the Consumer Product Safety Act (CPSA) and strengthens the U.S. Consumer Product Safety Commission (CPSC).
Product Safety Legislation Update Aug2008
July 2008
Insurance Alert
Supplemental Update to July 2, 2008 Update - New Insurance Legislation Passed in New York
July 2008
Worker’s compensation law: recent ruling by the State Supreme Court in Albany impacts self-insured trusts and self insurers
All self-insured employers in New York should pay special attention to a recent ruling by the State Supreme Court in Albany County regarding Group Self-Insured Worker’s Compensation Trusts. In Held v. State of New York Worker’s Compensation Board, the Court held that the Worker’s Compensation Board could not levy assessments against solvent Group Self-Insured Trusts (GSITs) and self-insurers to make up for lack of sufficient monies from insolvent GSITs without first meeting certain condition precedents contained in the Worker’s Compensation Law.
July 2008
Vicarious Liability Law Alert
Court of Appeals allows automobile accident victims to add vicariously liable leasing and rental companies to lawsuits commenced before adoption of federal statute preempting such actions
July 2008
Environmental Toxic Tort Alert - Florida Appellate Courts clash over Florida's Asbestos & Silica Fairness Compensation Act
Just recently the Florida's Fourth District Court of Appeal, seated in Palm Beach County, Florida, ruled that Florida's Asbestos and Silica Fairness Compensation Act (Florida Statute §774.201, et seq.), was unconstitutional as retroactively applied to cases filed before the effective date of the Act in July of 2005. Williams v American Optical Corp., 2008 Fla. App. LEXIS 7532, (Fla. 4th DCA 2008). At issue is the fate of over 8,000 pending asbestos cases in Florida.
July 2008
Insurance Alert - Update – New Insurance Legislation Passed in New York
In a marked departure from longstanding precedent, the New York State Legislature has passed a bill, shortly expected to be signed by Governor David A. Paterson, that erodes - if not eliminates - the late-notice defense available to insurers under liability policies covering personal injury and property damage. For the first time in New York, prejudice will have to be proven to disclaim coverage on the ground of late notice. In addition, claimants will be allowed to bring direct actions against insurers who have disclaimed coverage due to late notice.
June 2008
Employment Alert - The Family and Medical Leave Act
The complexities of the Family and Medical Leave Act (FMLA) have made it difficult for employers to know exactly how to address the variety of claims submitted by employees. The courts have often stepped in to interpret many issues under the FMLA; however, they have sometimes disagreed on key issues. In this article, originally featured in Employment Plan Review from May 2008, David M. Holmes, Partner in our Chicago office, examines two issues that have been addressed by the courts: (1) what an employee must do to trigger FMLA leave; and (2) what and employer must consider in determining whether an employee has a “serious health condition” entitling that employee to FMLA leave. Click here to view full article.
June 2008
Contruction Alert - Lack of knowledge insufficient to insulate owner from liability under labor law §240
The New York Court of Appeals has recently held that a landlord is strictly liable under New York Labor Law § 240(1) for injuries to a worker, even though the injury- producing work was conducted without the landlord's knowledge or consent, and in violation of the lease.
May 2008
ERISA Alert
U.S. Supreme Court hears ERISA conflict-of-interest benefits determination case
April 2008
Directors & Officers Liability Insurance Alert
For excess carriers who are tired of being asked to pay without the full exhaustion of the underlying coverage, the case of Qualcomm v. Underwriters at Lloyd's provides some comfort.
March 2008
Product Liability Alert
Product safety legislation update: Following a record-setting year for the number of product recalls by the U.S. Consumer Product Safety Commission (CPSC), Congress is looking to legislatively overhaul the CPSC. While the bills introduced separately by the House and Senate purport to protect consumers from unsafe products, they actually may cause more harm than good.
March 2008
Vicarious Liability Law Alert
Automobile leasing companies breathe sigh of relief as Graham v. Dunkley is overturned on appeal Plaintiff's bar waits for other shoe to drop in U.S. Court of Appeals, 11th Circuit
February 2008
Insurance Alert
The Texas Supreme Court holds that Texas public policy does not prohibit insurance coverage of exemplary damages for gross negligence in the workers' compensation context
February 2008
Supreme Court Decision Increases Potential Investor Claims Under ERISA
On February 20, 2008, the Supreme Court entered a significant decision reversing a district court's decision granting a Defined Contribution Plan Administrator's motion to dismiss. The District Court decision was affirmed by the Fourth Circuit Court of Appeals. The matter is breach of fiduciary duty claim brought under the Employee Retirement Income Securities Act of 1974 ("ERISA") where the administrator of a defined contribution plan allegedly failed to follow one of the participant's instructions regarding his account.
February 2008
Accountants Alert - Carefully considered engagement letters can reduce the exposure to otherwise untimely accounting malpractice claims in New York
Countless articles and lectures addressing risk management for accountants have preached the benefits of carefully tailored engagement letters for all clients. While the accounting profession's utilization of engagement letters has come a long way, many firms, including some of the largest firms in the world, do not devote as much energy as they should to properly confirming the terms of every engagement. The recent New York County Supreme Court decision in Apple Bank for Savings v. PricewaterhouseCoopers, LLP (Sup. Ct., N.Y. County, Index No. 603492/06, Feb. 5, 2008) illustrates how the failure to carefully consider the importance of an engagement letter for all aspects of client engagements can expose accountants to malpractice claims in New York that otherwise would be untimely and barred by the statute of limitations.
February 2008
Insurance Alert - Recent Decision Regarding SOLI Policies in the Southern District of New York
On January 22, 2008, the Honorable Denny Chin of the U.S. District Court for the Southern District of New York issued a decision in the case of Life Product Clearing LLC v. Linda Angel et al., holding that life insurance policies are invalid if purchased solely for resale to a third party.
February 2008
Insurance Alert - New Jersey Supreme Court warns insurers against seeking declaratory relief while defending the policyholder under a reservation of rights
Citing New Jersey's interest in remediating contaminated sites within its borders, the New Jersey Supreme Court has held that a later-filed New Jersey coverage suit takes precedence over an earlier-filed lawsuit in New York. The Supreme Court's ruling could be viewed as the latest affirmance of New Jersey's longstanding interest in funding remediation projects in New Jersey, except that the court offered a second, and novel, basis for its holding - that the primary insurer defending the policyholder under a reservation of rights acted cavalierly, and perhaps in bad faith, by initiating a declaratory action to determine coverage. The court's criticism of insurer initiated coverage suits contradicts longstanding practice and creates uncertainty for insurers seeking a judicial resolution of coverage issues.
January 2008
Insurance Alert - Wilson Elser wins appellate decision affirming dismissal of pollution coverage claim
Wilson Elser recently obtained a decision from the U.S. Court of Appeals for the First Circuit (the “First Circuit”) affirming summary judgment dismissing a policyholder’s claim for loss stemming from a leaking underground storage tank. Michael J. Case (Partner-Metro New York), along with Robert D. Sullivan Jr. (Associate-Metro New York) and Mark R. Freitas (Associate-Boston), represented the insurer.
January 2008
IP Alert
Resolving Domain Name Disputes: A Primer
January 2008
Accountants Alert
The Stoneridge Decision—Curtailing Private Securities Fraud Claims against Secondary Actors (such as Accountants and Other Professionals): On January 15, 2008, the Supreme Court of the United States issued a decision (5-3) in Stoneridge Investment Partners, LLC v. Scientific-Atlanta, Inc., et al., which clarified and curtailed the investing public's right to bring a federal securities fraud action against secondary actors under both primary and aiding and abetting theories of liability.
January 2008
Wilson Elser team obtains appellate decision
In one of the nation's first appellate decisions on point, the Appellate Court of Illinois (First Judicial District), applying New York law, has affirmed that payments a policyholder makes to the federal government to resolve criminal charges pursuant to a pretrial diversion agreement are uninsurable as a matter of public policy. Wilson Elser insurance coverage partners Thomas W. Hyland, Michael J. Case and Joseph L. Francoeur advanced the winning argument.
January 2008
Managing the heightened preparer liability standards for federal tax preparation engagements
The Small Business and Work Opportunity Act of 2007, enacted on May 25, 2007, made several important changes that broadened and toughened tax return preparer penalties applicable to undisclosed positions on a prepared tax return. As enacted, the provisions were effective immediately, but IRS Notice 2007-54 postponed the effective dates for the changes until after December 31, 2007, which means they are here for the 2008 tax season.
January 2008
Insurance Alert - Appellate Court Unanimously Upholds Exemption for Municipal Insurance Contracts
Wilson Elser received a unanimous decision from the Appellate Division, Second Department, in Hanz Andre v. City of New York, the Metropolitan Transportation Authority ("MTA") and AIG Claim Services, Inc. ("AIG"), 2008 Slip Op. 00080 and 00081 (A.D. 2d. Dept. January 8, 2008) reversing a trial court's decision that a claim services agreement incorporated in an insurance policy procured by a government entity must be competitively bid. Of significance, for the first time in more than fifty years a New York appellate court addressing competitive bidding requirements for municipal insurance contracts held that such insurance polices were exempt.
January 2008
California implementing new reporting requirements with reference to settlements and judgments of claims involving engineers and surveyors
As of January 1, 2008, the California Board for Professional Engineers and Land Surveyors will begin enforcing Article 4.5 of the California Professional Engineers Act and Article 5.7 of the Professional Land Surveyors' Act. The new requirements are directed to both the licensees and their professional liability insurers, as well as the courts that rendered the judgments. A report form was published by the board on January 3, 2008.
January 2008
Insurance Alert - Third Circuit Upholds Life Insurer's Right to Approve Reinstatement
In West v. Lincoln Benefit Life Company, 2007 WL 4336192 (3d Cir. 12/13/07), the Third Circuit held that reinstatement of a lapsed life insurance policy is not effective until and unless the insurer approves the insured's application for reinstatement prior to the insured's death. Mere payment of overdue premiums and submission of a completed reinstatement application is not enough to reinstate the policy, even if the application contains evidence of insurability otherwise satisfactory to the company. The court further held that the insured's or policyholder's subjective expectations regarding reinstatement do not alter the outcome under the doctrine of reasonable expectations in cases where there is no affirmative misrepresentation by the insurer regarding the requirements of reinstatement.
December 2007
Court of Appeals Summarily Affirms Dismissal under Forum Non Conveniens
The U.S. Court of Appeals for the District of Columbia summarily affirmed the dismissal of a case brought in the U.S. District Court for the District of Columbia against Marriott International for a tort that occurred in Mexico. Stromberg v. Marriott International, Inc., 474 F. Supp. 2d 57 (D.D.C. 2007), aff'd per curiam, Appeal No. 07-7038 (D.C. Cir., Nov. 14, 2007). The opinions that dismiss the lawsuit have significance for any U.S. multinational corporation doing business outside the United States.
December 2007
Ex Parte Interviews with Physicians Upheld
Wilson Elser obtains major victory at New York's high court: defense counsel may conduct private informal interviews of personal injury plaintiffs' treating physicians. On November 27, 2007, New York's highest court - the Court of Appeals - held that defense counsel have a right to conduct private informal interviews of a plaintiff's nonparty treating physicians. Arons v. Jutkowitz, 2007 N.Y. Slip Op. 09309 (November 27, 2007).
September 2007
Insurance Alert - Texas Construction Defect Claims
Texas Supreme Court holds that construction defect claims may meet the "Occurrence" and "Property Damage" requirements of CGL policies and that the Texas prompt-payment statute applies to the duty to defend
September 2007
Insurance Alert - Florida Auto Rental and Leasing
Recent court rulings in Florida and New York may leave automobile rental and leasing companies facing renewed exposure to vicarious liability
August 2007
Insurance Alert
Teeth Remain in New Jersey Lawsuit Threshold Law: Personal automobile insurers in New Jersey both won and lost on July 31, 2007, when the state's Supreme Court kept the teeth - so to speak - in the Automobile Insurance Cost Reduction Act ("AICRA") by ruling that a chipped tooth does not constitute a "displaced fracture" and therefore plaintiffs are not entitled to collect for pain and suffering from such an injury.
August 2007
Insurance Alert
The New York Supreme Court, Appellate Division, Second Department, decides that suspicion of fraud does not excuse insurers from acting on no-fault claims within 30 days
August 2007
Insurance Alert
New York Governor Eliot Spitzer vetos legislation overturning New York’s “no prejudice” rule
August 2007
Insurance Alert
Duty to Defend Additional Insured Under New York Law: Must liability be determined before an additional named insured under a general liability insurance policy is entitled to a defense in an underlying personal injury action?
July 2007
ERISA Alert
New Jersey seeks to prohibit the use of certain “discretionary” interpretation clauses in insurance contracts
June 2007
Insurance Alert
New insurance legislation passed in New York: Plaintiffs would be permitted to file a prejudgment declaratory judgment action to determine the existence of coverage and to prohibit an insurer from denying coverage for late notice absent material prejudice.
June 2007
Texas Toxic Tort Alert
Texas Supreme Court: Asbestos plaintiff must prove defendant’s product was substantial factor in causing asbestos disease.
June 2007
Medical Malpractice Alert
Habit evidence: By decision and order dated June 12, 2007, the New York Court of Appeals held in Rivera v. Anilesh that evidence of a dentist’s routine procedure for administering injections of anesthesia was admissible to support a motion for summary judgment.
June 2007
Accountants Alert
In its "first opportunity to determine the applicability of the continuous representation doctrine in an accounting context," the New York Court of Appeals, in Williamson (Respondent) v. PricewaterhouseCoopers LLP (Appellant), No. 64, June 7, 2007, held the doctrine inapplicable where the professional engagement consisted of "separate and discrete" annual engagements and such engagements did not concern "a course of representation as to the particular problems (conditions) that gave rise to plaintiff's malpractice claims."
May 2007
Insurance Alert
Wlson Elser wins appeal for Liberty Mutual Insurance in bad faith claim.
May 2007
Environmental Alert
Wilson Elser successfully defends $18 million New Jersey Spill Act claim resulting from TCE discharge.
April 2007
Accountants Alert
Newly articulated danger that auditors may incur primary liability for fraud under U.S. securities laws under certain circumstances.
April 2007
Securities Alert
Disclosure information reported on NASD Form U-5 granted absolute privilege status.
March 2007
Prior Acts Coverage Update
New Jersey Supreme Court rules that the failure to disclose a potential claim on an application for insurance results in denial of legal malpractice coverage.
March 2007
Occurrences Alert
The “unfortunate-event test” in quantifying the number of occurrences in general liability policies.
March 2007
Legislative Immunity Alert
Second Circuit extends legislative immunity protection to officials during private meetings.
February 2007
Forum Non Conveniens Alert
The Federal Court in the District of Columbia recently dismissed a case based on the doctrine of forum non conveniens on behalf of Marriott International, Inc. Stromberg v. Marriott International, Inc., 2007 U.S. Dist. LEXIS 8280 (D.D.C. Feb. 7, 2007). The case has significance for any U.S. multi-national corporation doing business outside the United States.
February 2007
Vicarious Liability Alert
A New York State Supreme Court decision declaring unconstitutional 49 U.S.C. § 30106 (which is meant to preempt state laws holding motor vehicle leasing and renting companies vicariously liable for the negligence of any permissive driver) has survived its first judicial challenge. The trial court that denied a defendant leasing company’s original motion to dismiss has now denied a motion to reargue that decision.
February 2007
Punitive Damages Alert
Philip Morris USA v. Williams: U.S. Supreme Court nixes punitive damages awards that punish a defendant for harm to nonparties.
February 2007
Alert
Optional Federal Charter gains prominent new support.
February 2007
Alert
California Fourth District rules public contract substitution does not establish breach of contract.
January 2007
Securities Alert
The SEC approves new NASD code of arbitration procedure.
January 2007
Alert
Avoiding entry of judgment by offers of compromise in Connecticut: The difference between Public Act 05-275 and the amended Public Act 06-40.
January 2007
Securities Alert
Pension Protection Act of 2006 and its potential impact on corporate equity.
December 2006
HIPAA Alert
Court limits defense’s ability to conduct ex parte interviews: On December 5, 2006, in a case of first impression at the appellate level, the Second Department drastically limited the ability of defense counsel to conduct ex parte interviews with a plaintiff’s treating physicians. The decision will have major implications for the manner in which defendants conduct pretrial discovery and prepare for trial.
December 2006
Construction Alert
Second Circuit rules illegal aliens can claim “lost wages” at higher U.S. wage levels - Awards based on wage rates of native countries rejected: The U.S. Court of Appeals, 2nd Circuit, ruled on Nov. 14, 2006, in Madeira v. Affordable Housing Foundation, Inc., that illegal alien workers in the United States are not restricted to lost earnings awards based on the existing wage levels of their native countries or other nations where they might be hired legally. This decision may be significant in New York state construction cases where injured plaintiffs often claim the Labor Laws were violated.
December 2006
Insurance Coverage Alert
Duty to defend under New York law - New York’s highest court broadens the duty to defend: The New York Court of Appeals, the state’s highest court, issued a decision earlier this year that greatly broadens the scope of the duty to defend under New York law.
November 2006
Accountants Alert
Continuous representation doctrine clarified by appellate court: The New York Supreme Court, Appellate Division, First Department, in Booth v. Kriegel (2006 NY Slip Op 08352, November 16, 2006), has provided much needed guidance concerning the application of the continuous representation doctrine, and specifically, the limitations in the application of the doctrine in accountants’ malpractice cases. This is welcome news after the First Department articulated the reaches of the doctrine in Williamson v. PricewaterhouseCoopers LLP (32 AD3d 179 (2006), lv granted 2006 NY Slip Op 77541 (1st Dept., October 12, 2006)), which we discussed in the August 2006 Accountants Alert.
November 2006
Securities Alert
NYSE and NASD – Do they have the urge to merge?: The New York Stock Exchange (NYSE) and the National Association of Securities Dealers (NASD) may soon be combining to form a single self-regulating organization (SRO) for the U.S. securities industry.
November 2006
Defense motion for summary judgment granted where plaintiff alleges to have sustained questionable “serious injuries”
New York State Insurance Law §5104 requires that all claimants establish that they have sustained a “serious injury” in order to recover in a bodily injury lawsuit resulting from a motor vehicle accident. There has been much debate among the four Appellate Courts in New York as to what constitutes a “serious injury” within the meaning of the statute.
November 2006
Liability of schools and school bus operators in personal injury claims brought by students in New York
In furtherance to our earlier advisory regarding the liability of schools and school bus operators, we have recently been successful in having a case dismissed in Kings County, New York, where the plaintiff alleged that he was severely injured when he was pushed by another student while boarding a school bus.
October 2006
Insurance Alert
Pennsylvania Supreme Court rules that a construction defect case cannot constitute an "occurrence" under general liability policies of insurance.
October 2006
Intellectual Property Alert
The counterfeiting of products, particularly those with well-known trade names, is a growing problem for companies and consumers alike. It is not just the street corner sales of “knock-off” watches and other luxury goods that is of concern these days...brand owners and all companies in the marketplace should be prepared to consider litigation as a tool to protect their interests.
October 2006
Florida Supreme Court interprets cure provision of Section 624.155, Fla. Stat. (2005) in Michelle Macola, et al. v. GEICO
The Florida high court continues the trend of decisions adverse to carriers in the context of bad faith cases. The decision evolves from questions of Florida law certified by the United States Court of Appeals for the Eleventh Circuit.
October 2006
Premises Liability Alert
"NY Court of Appeals rules in favor of landlords: compliance with code equals due care" - For the past 20 years, there has been doubt whether a landowner's compliance with statutory and regulatory building codes would suffice to discharge his duties of due care. In the decision, Rivera v. Nelson Realty (NY Court of Appeals, October 24, 2006), New York's high court has answered the question definitively...
October 2006
Estate Planning Alert
As 2006 quickly draws to a close, it is the perfect time to focus one's attention on lifetime planning goals. One important and simple way this can be accomplished is through the use of "gifts."
October 2006
Intellectual Property Alert
"Trademark Dilution Revision Act of 2006: Famous trademarks to gain greater protection in U.S." - On September 25, 2006, the U.S. Senate passed a landmark bill (H.R. 683) that provides greater protection for famous U.S. trademarks. The Trademark Dilution Revision Act of 2006 (“TDRA”) is a revision of the Federal Trademark Dilution Act of 1995 (“FTDA”).
September 2006
Vicarious Liability Law Alert
In a local court ruling with significant statewide and possible national implications, the New York State Supreme Court, Queens County, has determined that a recently enacted federal law preempting state vicarious liability laws for motor vehicle leasing companies is unconstitutional. If upheld, Justice Thomas V. Polizzi’s decision in Graham v. Dunkley (2006 NY Slip Op 26358, 2006 NY Misc. LEXIS 2375) will have a significant impact for companies that lease or rent motor vehicles.
September 2006
A Business Guide: Strategic preparation for “e-Discovery” under the new federal rules
There has been significant media coverage about the up-coming e-changes to the Federal Rules of Civil Procedure. Most is directed to lawyers that will be on the front lines in courthouses around the country rather than the businesses. It is important for companies and individual litigants to understand that these changes will have very significant effects on their involvement in the litigation process.
September 2006
Second Circuit denies successor liability of purchaser of business responsible for pollution
According to a recent decision by the U.S. Court of Appeals for the Second Circuit, the environmental cleanup liability of a potentially responsible party ("PRP") is not automatically assumed by a purchaser of the PRP, unless there is "continuity of ownership" between the PRP and its subsequent purchaser.
August 2006
Accountants Alert
In denying the application of the continuous representation doctrine until after "a full exploration of the facts" the New York Supreme Court, Appellate Division, First Department, in Williamson v. PricewaterhouseCoopers LLP (2006 NY Slip Op 05116, June 22, 2006) has made it inexorably more difficult for accountants to dismiss an accountant malpractice claim on statute of limitations grounds at the pleadings stage.
July 2006
House committee approves the Nonadmitted and Reinsurance Reform Act of 2006 - H.R. 5637
On July 26, 2006, the House Financial Services Committee approved H.R. 5637.
July 2006
New York State Health Law Section 4201
Effective August 2, 2006, pursuant to Public Health Law §4201, individuals will be able to include in their estate planning, an assignment of agent in the disposition of remains. While this may seem unnecessary to the majority of individuals, with the increase of multiple marriages, same-sex relationships and individuals who are choosing co-habitation over legal marriage, the disposition of a loved one's remains is increasingly being litigated.
July 2006
The Nonadmitted and Reinsurance Reform Act of 2006 - H.R. 5637
A bill has been introduced into the United States House of Representatives (H.R. 5637), which may significantly impact the way insurance companies do business. Because insurance in the United States, with few exceptions, has been exclusively regulated by each of the 50 states, the U.S. market is less "a market" and more like 50 different markets. H.R. 5637 may help to alleviate significant obstacles facing reinsurers and the surplus line industry in providing customers, domiciled in different states, what they need.
July 2006
Lost punitive damages not recoverable in subsequent legal malpractice case under Illinois law
On June 22, 2006, the Illinois Supreme Court issued an opinion in Tri-G, Inc. v. Burke Bosselman & Weaver, 2006 Ill. LEXIS 1090, where the court held that, in a matter of first impression under Illinois law, a legal malpractice plaintiff may not recover punitive damages that were lost in the underlying case. In finding that lost punitive damages are not compensatory damages in a subsequent legal malpractice case, the court followed the approach taken by the courts in California and New York.
June 2006
NAIC Reinsurance Task Force to Explore Alternatives to Full Collateral Funding Required of Alien Reinsurers
Over strong objections of U.S. insurance companies, state insurance regulators took action at the recently concluded National Association of Insurance Commissioners' (NAIC's) Summer Meeting that could lead to reducing the current collateral requirements imposed upon alien, non-admitted reinsurers for reinsurance ceded by U.S. domestic insurers.
June 2006
U.S. Court of Appeals Rules that Attorneys’ Fees and Costs May Be Covered as “Damages” under Liability Policies – Los Angeles
Cutler-Orosi Unified Sch. Dist. v. Tulare County Sch. Dists. Liab./Prop. Self-Ins. Auth. (1994) 31 Cal.App.4th 617 held that attorneys' fees and costs are not considered "damages" under California insurance law. Fee awards do not compensate claimants for the injury that brought them to court and therefore do not fit the concept of damages in the ordinary and popular sense.
June 2006
Labor Law Section 240 Claims No Longer a Sure Win for Plaintiffs
Courts have traditionally held that owners and general contractors are absolutely liable for injuries that are height-related, pursuant to Labor Law Section 240. However, the Courts have recently held that if the plaintiff is found to have been the sole proximate cause of the accident then the plaintiff's Labor Law 240 claim will be dismissed.
June 2006
Liability of Schools and School Bus Operators in Lawsuits Brought by Students - NY
Generally schools and school bus operators are under a duty to adequately supervise the students in their charge and they will be held liable for foreseeable injuries proximately related to the absence of adequate supervision. The New York courts have set out guidelines and conditions that must be met in order to hold a school district or school bus operator liable. The following outlines the law and should be useful as a rudimentary tool in assessing a case and whether it is a candidate for a summary judgment motion.
May 2006
A Trio of “No Loss” D&O Insurance Decisions
In a trio of recent decisions, Wilson Elser’s Chicago office has been at the forefront of the “no Loss” argument for Directors and Officers (“D&O”) Liability Policies – i.e., rescission or restitutionary damages do not constitute “loss” under a D&O policy.
April 2006
New York’s Highest Court Permits Illegal Immigrant Workers to Claim Loss of Earnings
On February 21, 2006, the Court of Appeals of the State of New York (the highest Court in New York) decided two cases which focused on this issue, and effectively held that, in certain circumstances, undocumented workers are entitled to recover lost earnings based upon the wages earned in the United States.
April 2006
Joint & Several Liability No Longer the Law in Florida
Florida has repealed the decades-old doctrine of joint and several liability. The legal doctrine of joint and several liability required every defendant in a lawsuit to be completely responsible for a plaintiff’s lost wages and medical costs regardless of his or her degree of fault. With this repeal, Florida has enacted the system of pure comparative fault in which defendants only pay their proportion of damages, economic and non-economic, equal to their percentage of fault assigned by a jury.
April 2006
NJ Property Owners Beware: Asbestos Liability Extends Beyond Property Line
New Jersey Supreme Court extends duty of landowner to spouse's household asbestos exposure claims.
April 2006
Mold Alert
The mere presence of mold spores at a property is not a sufficient basis for expert testimony on the medical effects of exposure to mold. Pervasive errors in the chain of custody of mold samples render scientific testimony based upon such samples inherently unreliable.
March 2006
Changes for Some NY Insurers
The New York Insurance Department has made a major change in the potential enforceability of discretionary language of health and disability insurance contracts. The Insurance Department issued Circular Letter No. 8 on March 27 addressing “Discretionary Clauses in Health Insurance Policies and Contracts including Disability Income Insurance.”
March 2006
Pseudoephedrine under Attack
Recently the plaintiff’s bar launched an attack against the pharmaceutical industry that may expand the notion of manufacturers’ liability. Patterned after moves in many areas to find firearms manufacturers liable for the damages caused by gun crime, a plaintiff in Oklahoma brought suit against Pfizer Pharmaceuticals and three generic drug manufacturers for the wrongful death of a police officer killed in the line of duty.
January 2006
Hazardous Materials - Railroads
The lessor of a tank car of combustible material is not responsible for damages from derailment. Furthermore, all of its duties are preempted by federal law.
December 2005
Bankruptcy Court Rejects “Deepening Insolvency” Liability
Although insolvency is a subject of increasing concern for the liability of corporate directors and officers, Judge S. Martin Teel Jr. of the Bankruptcy Court for the District of Columbia recently rejected creditors’ claims based upon the theory of “deepening insolvency” as an independent tort.
December 2005
Connecticut Court Invalidates Waiver of Liability
A waiver releasing recreational operators from liability for personal injuries caused by their negligent conduct violates Connecticut public policy and cannot be enforced.
November 2005
Otis D. Wright II Appointed Judge
Wilson Elser is proud to announce that Partner Otis D. Wright II has been appointed Judge by California Gov. Arnold Schwarzenegger as a Los Angeles County Superior Court judge.
October 2005
New York Court Rejects Household Asbestos Exposure Claims
An employer/premises owner does not owe a duty of care to a family member who was allegedly injured from exposure to asbestos dust that employee-husband introduced into the family home on soiled work clothes.
October 2005
Katrina Spawns Storm over Insurance
Typically, a homeowner's policy contains a water damage exclusion. Insurers do not insure for water damage occurring either directly or indirectly "...regardless of any other cause or event contributing concurrently or in any sequence to the loss." Typical water damage exclusions encompass, among other things...
August 2005
Graves Amendment Alert
Federal preemption of state vicarious liability laws and the changing landscape of motor vehicle accident litigation.
August 2005
Effectiveness of Employee Waivers of Family and Medical Leave Act Claims in Doubt
A recent federal court case has ruled that certain individuals can sue their employers for alleged violation of a federal law even after signing a release and accepting money offered through a separation agreement.
August 2005
Marine Insurance Principles and Admiralty Jurisdiction Extended by Leading Federal Appellate Court
Court of Appeals holds that admiralty jurisdiction and marine insurance principles control a tailored comprehensive general liability and shiprepairer's legal liability policies where the "primary objective" was to provide marine insurance.
July 2005
Employment Alert
On July 18, 2005, the California Supreme Court expanded potential liability for employers. California employees may now sue their employers for sexual harassment if their employment is affected by an office romance between their supervisor and a fellow employee.
March 2005
Court of Appeals broadens “recalcitrant worker” defense in construction injury cases
In December of 2004, the Court of Appeals broadened the scope of the “recalcitrant worker” defense in actions brought under Labor Law § 240(1) by reversing the Appellate Division’s decision in the case of Cahill v. Triborough Bridge and Tunnel Authority.
March 2005
Marine hull insurer participates in recovery settlement with third parties and is awarded attorneys' fees and costs for breach of settlement agreement by insured according to recent Court of Appeals' decision
A marine insurer is entitled to share in the proceeds of a subsequent settlement between its insured, vessel owner, and a third party pursuant to the express terms of the agreement resolving litigation under the hull policy. The Court of Appeals for the First Circuit reversed summary judgment and directed entry of judgment as a matter of law, also ruling that insurers were entitled to recover their “reasonable attorneys fees and costs” from the insured for breach of their settlement agreement. Home Insurance Co. v. Pan American Grain Manufacturing Co., Inc., 2005 U.S. App. LEXIS 1827 (1st Cir. February 4, 2005).
February 2005
Supreme Court of New Jersey holds that municipal construction officials may cite developers for construction code violations on property already issued a certificate of occupancy. DMK Residential Properties Corporation v. The Township of Montgomery, docket no. a-61-03, Supreme Court of New Jersey, January 24, 2005.
On January 24, 2005 the Supreme Court of New Jersey held that a municipal construction official has the authority to cite a developer for violations of the New Jersey Uniform Construction Code (“UCC”) “in respect of property that has been conveyed and for which a certificate of occupancy has issued.”
February 2005
Rowdy Elsner v. Carl Uveges
California update: California Supreme Court affirms admissibility of Cal OSHA regulations to establish negligence per se, and more.
June 2004
State Farm v. Campbell May Not Be Enough to Curb Runaway Punitive Damage Awards
The United States Supreme Court's mandate enunciated in State Farm v. Campbell for state appellate courts to closely scrutinize and rein in large punitive damage awards may not be enough to curb excessive punitive damages awards once and for all.
June 2004
Mississippi Passes Sweeping Tort Reform Bill
On June 16, 2004, Mississippi Governor Haley Barbour signed into law a massive tort reform bill that institutes venue reform by limiting places where a plaintiff can sue, caps non-economic and punitive damages and provides protection for innocent product sellers and premises owners. This tort reform will become effective September 1, 2004.
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