Monthly Archives: April 2012

NY City Liable When Police Bust Drug Dealer?

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A municipality is generally not liable for negligent police protection absent a “special relationship” with the plaintiff. A special relationship can be established if the municipality assumed an affirmative duty to act, had knowledge that inaction could lead to harm, had direct contact between its agents and the injured party, and the injured party justifiably relied on the municipality’s affirmative undertaking.

This principle was tested in Matican v. City of New York. The plaintiff had been arrested after purchasing drugs from a certain drug dealer. While in custody, the plaintiff agreed to become a confidential informant to help the police arrest the dealer. The plaintiff did so under the proviso that the police would arrest the dealer under the pretext of an ordinary traffic violation and that, if the dealer made bail and came after the plaintiff, the police would protect him.

The next day, the plaintiff called the dealer to meet at their agreed spot. Each time they had met at this spot in the past, the dealer made an illegal U-turn. Instead of living up to the arrangement and stopping the dealer for making an illegal U-turn, the police swarmed the dealer’s car by emerging from three separate police cars. They then tore the car apart, eventually finding the drugs in the dealer’s underwear. When the dealer made bail, he went after the plaintiff for ratting on him.

Although the Supreme Court granted summary judgment to the City, the Second Department reversed, finding that there were issues of fact as to whether the City assumed an affirmative duty to (1) protect the plaintiff by concealing his identity when they arrested the dealer, and (2) to protect the plaintiff from retaliation.

Thanks to Gabriel Darwick for his submission.

New Notification: PA Updates Status on Facebook Disclosures

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While the phenomenon of social media continues to expand, so too does the courts’ understanding of the nexus between Facebook and discovery disclosures. As we have noted previously, the trend in both state and federal court has been to allow the defendant access to a claimant’s Facebook account for the purpose of challenging credibility. However, a recent decision from the Montgomery County Court of Common Pleas has extended the doctrine in Pennsylvania to permit the plaintiff’s investigation of Facebook for evidence of the underlying incident.

In the case of Gallagher v. Urbanovich, the court considered a motion to compel access to the defendant’s Facebook credentials following a claim that the he sucker-punched a man during a work-sponsored soccer game. Although Pennsylvania judges have ordinarily required an initial review of the party’s public information before granting such discovery, the court in Gallagher agreed with the plaintiff’s contention that Facebook is simply another source for admissible statements made by an opponent and therefore allowed unbridled access to the defendant’s account. Additionally, the court’s order implicated the potential for spoliation issues and forewarned the defendant against destructing or altering the information contained on the site.

While Pennsylvania appellate courts have yet to comment on the appropriateness of Facebook disclosures, the expanse of Gallagher is certainly noteworthy. In the absence of a uniform approach, Gallagher may have the potential to create a new standard for the discovery of Facebook evidence when material to the actual incident.

Thanks to Adam Gomez, law clerk, for this post.  If you have any questions or comments, please email Paul at .

 

 

N.J. Court Determines Coverage For Injury Near Stores In Close Proximity

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A recent N.J. Appellate Division case  analyzed the often complicated assessment of insurance coverage for personal injuries that occur on a property with more than one commercial tenant. In VSH Realty, Inc. and Cumberland Farms v. Sub Busters, the underlying plaintiff visited a strip mall intending on visiting both Sub-Busters and Cumberland Farms. As she walked from her car towards the entrance of Cumberland, she slipped and fell. The jury subsequently found Cumberland liable for failing to clean and remove snow outside their store .  The property owner sought indemnification from Sub-Busters’ insurer (Cumberland Mutual) based on policy language providing coverage to the property owner but only with respect to liability arising out of the maintenance, ownership or use of that part of the designated premises leased to Sub Busters.  The Trial Court, based upon a review of the above language, declared that Cumberland was owed coverage from Sub-Busters’ insurer.

The Appellate Division reversed and held that the accident did not arise out of the maintenance or “use” of Sub-Busters’ leased premises.  Although under New Jersey law a commercial tenant may be “using” its premises even if a claimant/customer is injured when not physically present on their property, such was not the case in VSH Realty.  Of significance, the plaintiff was walking into Cumberland Farms with only a future intention of going to Sub-Busters: plaintiff was never actually on Sub-Busters’ property.  Further, it was conclusively determined during underlying trial that the slip and fall occurred because of Cumberland’s sole negligence in failing to clear the walkway. A further review of Sub-Busters’ insurance policy demonstrated that Cumberland Mutual agreed to only indemnify VSH for claims arising out of the maintenance or use of the property leased to Sub Busters.  Since the area where plaintiff fell was not leased to Sub-Busters nor did the accident arise out of Sub-Buster’s “use” of the premises, Sub-Busters’ insurer had no duty to defend or indemnify the strip mall owner. (“we reject an extension of that body of law to cover such an event [that] would suggest that leased premises were “used” merely because the injured patron intended, without acting on the intention, to patronize the premises.”]

This case once again highlights the tricky interpretation of commercial general liability policies when two or more entities are conducting business in a very close proximity and a patron is injured in a common area.

Thank to Andrew Marra for this post.  If you have any questions or comments,  please email Paul at

 

 


48% of Chicken in US Stores Contaminated with E-Coli.

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According to this NYT article, a study by the Physicians Committee for Responsible Medicine has found that 48 percent of 120 chicken products bought in 10 major US cities was contaminated with e-coli, likely resulting from fecal contamination.  The study has been challenged (on bias and sample size grounds), but it gives insurers something else to worry about.  It also makes you look a different way at your grilled chicken or chicken curry dinner…

For more information about this post, please contact Bob Cosgrove at .

PA Appellate Division Grapples With Contractor Liability for Employees and Independent Contractors.

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In the case of Patton, et al v. Worthington Associates, Inc., Pennsylvania’s appellate division was faced with the defendant’s appeal of an adverse trial verdict.  The case’s relevant facts are as follows.

The Christ Methodist Church hired Worthington to perform construction work.  Worthington subcontracted the work to Patton Construction.  While Patton Construction was performing work, Patton (its principal) fell 14 feet to the ground and suffered injuries that a Bucks County jury valued at more than $1,500,000.  He sued Worthington.  At the close of discovery, Worthington filled a motion for summary judgment and argued that it was the “statutory employer of Patton under the Pennsylvania Worker’s Compensation Act.”  Specifically, Worthington argued that it was entitled to the benefits of §52 of the Act which states: 

“An employer who permits the entry upon premises occupied by him or under his control of a laborer or an assistant hired by an employee or contractor, for the performance upon such premises of a part of the employer’s regular business entrusted to such employee or contractor, shall be liable to such laborer or assistant in the same manner and to the same extent as to his own employee.”

Worthington further argued that Patton was not an independent contractor (which would negate the defense), but rather a statutory employee because: (a) Worthington  was under contract with Patton Construction; (b) the site where the accident occurred was under Worthington’s control; (c) Worthington’s regular business at the accident site was entrusted to Patton Construction; and (d) Patton was a direct employee of Patton Construction.  The  motion was denied and the court allowed the jury to decide if Patton was an independent contractor or a statutory employee.  The jury ruled that he was an independent contractor, the award was given and the appeal resulted.

The Superior Court has now ruled that the trial court was correct to submit the question to the jury as the issue was one of fact and not law.  Yet another hurdle to overcome in Pennsylvania construction accident cases!

For more information about this post, please contact Bob Cosgrove at .

Nothing To Weep About For Art Purchaser

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The New York State Court of Appeals recently decided a dispute over the ownership of a 1,100 pound sculpture entitled The Cry, by Jacques Lipchitz, between the executor of the owner’s estate and the purchaser (who purchased the sculpture from a man claiming to have been gifted the sculpture from the owner in 1997). In July 2004, the executor of the estate claimed to have sold the sculpture to an art gallery, while the purchaser claimed to have purchased the sculpture from another man in September 2005. The executor and the purchaser each filed petitions asking the Surrogate’s Court to resolve the conflicting claims of ownership.

The Surrogate’s Court found in favor of the purchaser, noting that the decedent’s inter vivos gift of the sculpture was valid, and dismissed the executor’s petition. However, on appeal, the Appellate Division, First Department, reversed on the law, finding that the purchaser’s claim of ownership was barred by the statute of limitations because the sculpture was converted in 1998 when loaned to the French government.

In Mirivsh v. Mott, the Court of Appeals reversed again and found that the Surrogate’s Court correctly ruled in the purchaser’s favor because the purchaser established each of the elements of a valid inter vivos gift (intent, delivery and acceptance) by clear and convincing evidence, and, in any event, both parties had agreed by stipulation to allow the Surrogate’s Court would decide ownership of the sculpture on the merits. The court noted that the original owner’s intent to make a present transfer of “The Cry” was clear on the face of the gift instrument, which was in the form of a picture of the sculpture with a writing describing the piece and declaring that it was a gift (and did not necessarily require physical transfer or delivery of the sculpture itself).

Thanks to Joe Fusco for this post. If you have any questions or comments, please email Paul Clark at

Litigation Financing: A Trap For The Unwary?

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Ever wonder how some plaintiff’s attorneys fund their cases or smooth out their cash flow?  In a recent case, it seems that one method is to obtain funding from outside sources secured on the estimated value of the firm’s cases, that is, on the settlement or verdict value of each case.  According to Kelly, Grossman & Flanagan, LLP v. Quick Cash, Inc., the prevailing rate of interest in these transactions is substantial ranging from 3.5% to 3.99% compounded monthly or an annual rate of nearly 40%!

Like many states, New York makes it a criminal offense to charge rates of interest on a loan beyond certain stated percentages.  In Kelly, the plaintiffs argued that the arrangement that resulted in funding of over $1,200,000 was, in fact, a loan subject to New York’s usury laws.  In contrast, the defendants argued that the usury laws only apply to “loans,” and not to transactions that involve interest to be paid based on a contingency not in the control of the debtor. In this case, the finance company contended that the contingency of whether a case settled or a jury returned a favorable verdict was not the  law firm’s control and therefore was not a “loan.”

In Kelly, it was bad news for the lawyers: the court held that the transaction was not a loan but an agreement that created an ownership interest in the proceeds of the lawsuits being prosecuted by the plaintiffs on behalf of their clients.

The Kelly case is a fascinating insider’s view of the recent trend of third party litigation financing where either law firms or their clients are advanced funds in exchange for a piece of the action on the tail end when the case settles or a favorable plaintiff’s verdict is obtained. Unfortunately, the price of admission is steep, with interest rates of near 40%.  These arrangements have ramifications for the defendants in these financed cases because the plaintiff’s settlement demands now must include not only the amount of outstanding medical bills or lost wages, but any sums owed to the third party financing companies.

If you have any questions or comments about this post, please contact Paul at

Hold On: Subway Trains Will Move

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In Cohen v. City of New York, plaintiff sued the MTA for personal injuries after the subway she had boarded allegedly lurched suddenly causing her to fall. She further alleged the MTA failed to warn her of a wet condition on the train due to a storm.  Defendants moved for summary judgment claiming that plaintiff had failed to demonstrate the train left the station in an unusual manner and that the wet condition was open and obvious and not the cause of plaintiff’s fall.  The trial court denied defendant’s motion.

On appeal, the First Department reversed the trial court’s decision and granted defendant’s summary judgment motion.  The Appellate Court explained that plaintiff failed to testify that the train jerked in an unusual or violent manner. Moreover, even assuming she had, she did not put forth the testimony of any other passengers that would confirm the abnormality of the train’s departure.  As such, she raised no triable issue of fact in response to defendant’s summary judgment motion. In addition, the First department disagreed with plaintiff’s liability theory based upon the wet condition.  Plaintiff conceded she was aware of the condition, and that such condition had not caused her to fall.  Moreover, the First Department found that the storm in progress doctrine applied, which states that while a storm is ongoing there is not an immediate duty to address the wet condition.

Thanks to Alison Weintraub for this post.  If you have any questions, please email Paul Clark at

Judicial Deference in NJ?

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In law school, one is taught that if two judges are of equal rank, the one cannot overrule the other on the same issues in the same case.  Yet the practice of law sometimes reveals contrary results.

In the case of Little, et al. v. KIA Motors, New Jersey’s appellate division was faced with the following fact pattern arising out of a class action consumer fraud case.  In brief (and out of respect the opinion talks about the “first trial judge” and the “second judge” without using names), in November 2008, the first judge issued various rulings (which are not essential to this blawg post) relevant to Kia’s request for post-trial relief.  In August 2011, the second judge overruled the first trial judge’s orders and issued new rulings that contradicted the first judge’s orders.  The instant appeal resulted.

The appellate division reversed the second judge and reiterated that “decisions of law made in a case should be respected by all other lower or equal courts during the pendency of that case.”  Good news for litigants and their insurers who count on finality in litigation.

For more information about this post, please contact Bob Cosgrove at .

What can your product be used for? PA Supreme Court says multiple uses may be considered in products liability suits

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In Beard v. Johnson & Johnson, the Pennsylvania Supreme Court found that a court conducting a risk-utility analysis on an allegedly  defective product should consider all of the uses of that product, not just the use that resulted in harm. The underlying state court case involved a woman who died of sepsis after bariatric surgery when the staples from the surgery did not close properly.  The plaintiff’s estate claimed that the area the surgeon stapled was too thick for the instrument used to insert her staples.  An Alleghany County jury agreed and award of $5 million.

The product at issue, an endocutter, was manufactured by a subsidiary of Johnson & Johnson. Although the plaintiff underwent open surgery, the endocutter is most commonly used for laparoscopic surgery.  The Superior Court overturned the jury’s award in part because the plaintiff’s estate failed, under a risk-utility assessment, to prove that the risks of the endocutter outweigh its benefit, especially during laparoscopic surgeries. At the Supreme Court, the plaintiff’s estate argued that since the endocutter was not used labroscopically during the plaintiff’s surgery that particular use should not factor into the risk-utility assessment. The assessment should be limited solely to the one implicated by the circumstances of plaintiff’s injury. However, the Supreme Court resoundingly rejected this contention and held that the appropriate focus of a design-defect risk utility analysis should not be limited to a particular intended use. Because the Pennsylvania trial courts are required to consider all aspects of a products use in their role as a “social philosopher”, they should not be required to put on blinders to avoid all practical uses of a given product.

Special thanks to Remy Cahn for her contributions to this post.  For more information, please contact Bob Cosgrove at .