In the case of Willingboro Mall v. 240/242 Franklin Avenue, et al., the plaintiff appealed from an order enforcing a settlement reached during a mediation session conducted pursuant to Rule 1:40-4. Plaintiff argued that the rule precludes enforcement of an oral settlement reached at a nonbinding mediation session. It also contended the alleged settlement was the product of coercion by the mediator. The facts giving rise to the appeal are as follows.

Plaintiff and defendants were commercial real estate entities who were involved in a default and foreclosure dispute. The parties were referred to mediation by the General Equity judge. The parties selected a retired Superior Court Judge as mediator, and attended a mediation session with their attorneys at the office of defendants’ attorney. After several hours, the parties agreed to a settlement. Counsel for defendants then wrote a letter to the General Equity judge to inform him that the parties had reached a settlement. The letter also stated the terms of the settlement.

Plaintiff refused to consummate the settlement and instead asserted that a final, binding settlement agreement had not been reached at the mediation session. Defendants then filed a motion to enforce the mediated settlement agreement, and supported the motion with a certification of their attorney and the mediator. A plenary hearing was conducted and a written opinion was issued, which found that the parties did in fact arrive at a settlement of the underlying case, and that the settlement was therefore binding.

On appeal, plaintiff argued that Rule 1:40-4(i) prevented enforcement of an oral settlement because the terms of the settlement were not reduced to writing at the mediation session, a copy of the writing was not provided to each party, and the parties did not affix their signatures to the writing at the mediation session. In addition, plaintiff argued that enforcement of a settlement reached at a mediation session is contrary to the non-binding nature of the mediation process.

The Appellate Division agreed with the trial court. It ruled that mediation is utilized to afford the parties an opportunity to present their position before an experienced professional with the goal of resolving some or all of the differences between the parties. Rule 1:40-4 (i) does not prohibit the mediator or one of the parties from reducing the terms of the agreement to writing shortly after conclusion of the mediation session as occurred in this case. Specifically, the court noted that in this case, three days after the mediation session, defendants’ attorney prepared and sent a letter stating the terms of the agreement reached by the parties. Two weeks later, he sent another letter informing plaintiff that he had placed the sum required to resolve the dispute in an escrow account. The Appellate Court held that these writings, the first memorializing the terms of the settlement and the second notifying plaintiff of defendants’ action to consummate the settlement, were within the intention of the rule requiring the agreement to be reduced to writing.

Two important points bear mention here. First, sometimes attorneys (and litigants) are held to their word and bound by their verbal actions. Second, and perhaps more importantly, know your case and the attorneys. If the attorneys on the other side seem like the kind of folks who will try to weasel their way out of an agreement, don’t leave the mediation until a written agreement is finalized and signed by all parties. It might take a little bit longer, but it’s certainly worth the effort – in fact, we just did this on a case on Wednesday where a post mediation “agreement on written terms” seemed like it might be hard to come by. But that’s a story for a different day…

Special thanks to Sheila Osei for her contributions to this post. For more information about it, or WCM’s NJ practice, please contact Bob Cosgrove at .

We have reported on several occasions about how social media has been slowly changing the legal landscape, particularly in terms of instructions to be given to jurors during trial proceedings. While judges must always instruct jurors not to communicate with anyone about the pending proceedings, jurors have continuously failed to comprehend that the judge’s instructions also apply to Facebook and twitter.

California has decided to be proactive about such juror actions, and is amending its jury instruction to include a prohibition against “any form of electronic or wireless communication.” Violators potentially face six months in jail.

New York was a bit ahead of the game on this issue as it revised its jury instructions in May 2009.

A “tweeting juror” in NY can be charged with criminal contempt, and very nearly was in the case of People v. Rios, 2010 WL 625221 (N.Y. Sup., 2010) during a well publicized arson trial in Bronx County.

Thanks to Biran Gibbons for his contribution to this post.

In the case of Eckman v. Erie Insurance, Solid Waste Services sued Eckman for false statements made during a local election campaign. Eckman presented the claim to its homeowner’s carrier, Erie. Erie assigned defense counsel under a reservation of rights. The ROR noted that intentional acts and punitive damages were excluded from coverage. Eckman rebuffed Erie’s assigned counsel and instead demanded counsel of its own choosing. When that offer was rejected, Eckman commenced a declaratory judgment action and sought injunctive relief to force Erie to provide Eckman with counsel of Eckman’s choosing. In making its argument, Eckman relied upon admittedly non-binding Pennsylvania case law and suggested that “a conflict of interest is a conflict of interest, exclusive of Pennsylvania case law.” Eckman argued that any attorney selected by an insurer under a reservation of rights, and paid by that insurer, would ipso facto breach his or her obligations to the insured/client.

Eckman’s claim was rejected both by the trial court and the Superior Court. In a good result for insurers, the court reasoned that a conflict of interest (such to support the assignment of independent counsel) must be proven and cannot merely be presupposed. This decision is consistent with controlling PA precedent and as the court rightfully noted, it is bound to “follow controlling precedent as long as decision has not been overturned by the Supreme Court.” So, in Pennsylvania at least, a reservation of rights does not automatically trigger a right to independent counsel.

If you have any questions about this post, please contact Bob Cosgrove at .

Absent a contractual obligation to make repairs or a retention of control over the property, an out-of-possession landlord cannot be held liable for personal injuries sustained on its premises. The Second Department reiterated this principle when affirming the trial court’s decision in Sciammarella v. Manorville Postal Associates, where the plaintiff, a U.S. Postal Service employee sustained personal injuries. Sciammarella fell after stepping into a hole on premises leased by the U.S. Postal Service. Defendant moved for summary judgment and established its prima facie entitlement to summary judgment on the basis that it was an out-of-possession landowner with no control or contractual obligation to maintain the premises.

Thanks to Alison Weintraub for her contribution to this post.

A common tactic in IP litigation is the assertion of a False Marking Statute claim. The False Marking Statute basically states that you can’t stamp the word “patented” on a product that, in fact, does not have a patent. Sounds simple enough. The problem is that for each distributed product that contains a false product marking, a fine of $500 can be awarded. But wait! There’s more. The right to the fine proceeds gets split between the litigant and the federal government.

So, under these circumstances, guess what happens? Right. If possible, litigants always assert these so-called qui tam claims to increase the case’s settlement value and/or the respective leverage.

Courts have begun to question whether allowing civil litigants to wield, in effect, prosecutorial powers by seeking fines for qui tam violations is constitutional. In the Eastern District of Pennsylvania, a split exists on the district level. In the most recent decision on point, Judge Baylson ruled that the statute is, in fact, constitutional. If this decision stands, it can greatly increase the cost of settling an IP case since the penalty value of the case can easily exceed the actual damages at issue.

If you have any questions about this post or WCM’s intellectual property practice, please contact Bob Cosgrove at .

In Deprado v. Planet Sushi, (Civil Court, New York County) plaintiff claimed that the “special sauce” served with her sushi contained semen. She had a sample examined by a lab, but the tests were inconclusive. The lab informed plaintiff that the sample would be discarded after six months, and neither plaintiff nor her attorney retrieved the sample. Defendant moved to dismiss the complaint based upon spoliation.

Plaintiff testified at her deposition that she destroyed or discarded all samples of the sauce. However, in an errata sheet to her deposition transcript plaintiff claimed she still had a sample in her freezer. This was sufficient to defeat the spoliation motion. The court noted that defendants can still move to dismiss if the sauce did not contain semen, and could use plaintiff’s inconsistent testimony at trial. However, the change in testimony was sufficient to defeat a spoliation motion.

For more information on this post, please contact David Tavella at .

http://pdf.wcmlaw.com/pdf/deprado.pdf

In Culler v. City of New York, the plaintiff was enjoying a swim at a public pool when he was threatened by a group of fellow swimmers. He reported the incident to a police officer who told him the pool was closing and he had to leave. When the plaintiff walked outside, he saw the group waiting for him with sticks and bottles. He again informed the officer who told him to just walk home. When the plaintiff left, he was chased by the group and attacked with the bottles. He fell and broke his ankle.

The First Department held that as a general rule a municipality can not be held liable for injuries resulting from the failure to provide adequate police protection. However, under the “special relationship” exception, liability will arise if the officer assumed an affirmative duty and the plaintiff relied on this undertaking. Unfortunately, the court found that, in the present case, the officer’s refusal to protect the plaintiff shielded him from liability.

Thanks to Georgia G. Stagias for her contribution to this post.

In an apparent effort to generate revenue for conducting inspections, since a budget increase is definitely off the table, the FDA has proposed instituting a fee on violators for the post-violation re-inspection that the FDA must conduct. One wonders whether the Tea Party will consider this a breach of the “no new taxes” pledge.

For more information about this post or WCM’s product recall practice, please contact Bob Cosgrove at .