Even Soft Tissue Injuries Can Prompt Recovery at Trial (PA)

A Philadelphia jury awarded a plaintiff a $40,000 verdict in a motor vehicle accident this past summer.  On October 7, 2013, the plaintiff, Brian Johnson, Jr., was stopped at a red light in West Philadelphia when he was struck from behind by the defendant, Tyra Elam.  The parties stipulated to negligence and the case was tried on causation and damages.

Johnson attended more than a dozen physical therapy sessions for lower back pain he alleged was a result of the accident.  He eventually stopped with physical therapy due to seizures.  He then had an MRI of his back, which showed bulges at various discs.  Johnson also underwent additional tests, which showed injuries to nerves in his spine.  He went to a pain specialist who administered an epidural injection and concluded that Johnson’s injuries were caused by the accident and that he suffered from serious bodily impairment.   Johnson’s physician recommended future medical treatment totaling $10,000 annually with a $50,000 procedure.  The defense presented a radiology expert who testified that Johnson’s bulging discs were degenerative and were not related to the accident.  After deliberation, the jury found that Elam’s negligence was the cause of Johnson’s injury.

This case illustrates that claims from even minor motor vehicle accidents can still result in plaintiff’s verdicts.  Here, the injuries, and resulting judgment, were modest.  But we all know that cases like this one can often result in surgery — and exposure in the six or seven digit realm.  The morale is even small claims don’t always remain small forever. Thanks to Peter Cardwell for his contribution to this post.  Please email Brian Gibbons with any questions.

Broken Hip doesn’t Break the Bank (Federal, PA)

The Third Circuit recently upheld a pretrial win for Zimmer Holdings Inc. over claims launched by a patient who sued the medical device maker after his hip replacement broke in Kline v. Zimmer Holdings, Inc.  In affirming, the Court found that there was no showing that Zimmer acted unreasonably in designing the product or warning.

On January 13, 2010, Gregory Kline underwent a total hip replacement.  His surgeon implanted a Femoral Stem with Kinectiv Technology.  On April 6, 2011, Kline’s hip replacement stem fractured at the neck.  Kline sued Zimmer Holdings Inc., Zimmer Inc., and Zimmer United States Inc. (collectively, “Zimmer”), alleging several state-law product liability claims.  By the time the case reached summary judgment, Kline’s only remaining claims were negligent design defect and negligent failure to warn.  The District Court granted summary judgment to Zimmer on all counts.

On appeal, the Third Circuit affirmed the judgment of the District Court because Kline failed to show that a reasonable jury could find that any unreasonable act or omission by Zimmer caused him harm.  In support of his position, Klein argued that the failure of the Zimmer device in another patient treated by Kline’s doctor was key to proving his claims for negligent design defect and negligent failure to warn.  However, the Court held that evidence regarding the other patient’s device failure was not admissible because it did not involve the same product under similar circumstances, nor did it (1) show notice to the defendant of the danger, (2) show the existence of the danger, or (3) show the cause of the accident.

With respect to Kline’s claim for negligent failure to warn, Kline’s theory, supported by Zimmer’s experts, was that an individual of Kline’s weight or body mass index who engaged in vigorous activity was at a higher risk of device failure.  However, as Kline acknowledged, a package insert for Zimmer’s device warned about those risks, at least in general terms.  Accordingly, there was no evidence in the record that the risk was of a magnitude to require a contraindication at any specific weight, body mass index, or activity level, except that the device broke in Kline.

Kline’s failure to prevail only goes to show that plaintiff’s counsel must still be able to prove that the product in question is in fact defective when that product fails, as opposed to inadvertent product failure.  Thanks to Hillary Ladov for her contribution to this post. Please email Brian Gibbons with any questions.


Homeowner’s Ice Removal Efforts Sufficient to Bar Recovery (PA)

In Sirchio v. Macdougal, the Montgomery County Court of Common Pleas addressed a few common issues that arise in sidewalk slip and fall cases during the cold winter season.

The plaintiff  fractured his ankle when he slipped on an icy patch of sidewalk while walking home one January evening in Conshohocken.  The plaintiff sued the defendant homeowner and alleged that the defendant was negligent in the maintenance of the property, because the defendant’s drainage system was improperly configured and leaked water onto the sidewalk.  The plaintiff also alleged that the area in front of the defendant’s home was not sufficiently lit and that the defendant should have known that the combination of the leaky water and poorly lit area created a hazardous, icy condition in the cold winter months.

The defendant countered that he was in fact aware of the propensity for dangerous icy conditions on the sidewalk; and that he exercised extra care in the winter by shoveling his walk, breaking up the snow and ice with a shovel, and applying materials to melt the ice.  The defendant also noted that there was a street lamp located less than a block away, and introduced expert evidence that the drainage system did not violate any municipal codes.  Finally, the defendant alleged that the plaintiff was comparatively negligent because the surrounding sidewalk was covered with snow, and thus the plaintiff should have been more careful when walking on the snow-and-ice covered sidewalk.

The plaintiff sought damages totaling $250,000 for past medical costs, lost wages, as well as past and future pain and suffering.  However, a twelve member jury found that the plaintiff was 65% liable and the defendant homeowner was only 35% liable.  Under Pennsylvania’s comparative negligence law, the defendant was thus barred from receiving any damages.

Defendants should be mindful that retention of the proper liability experts likely made what amounted to a defense verdict possible here.  Thanks to Greg Herrold for his contribution to this post.  Please email Brian Gibbons with any questions.

Going to Need a Bigger Boat? Will Cyber Rules Finally Impact Insurers and Their Vendors (Like Lawyers)?

You might have noticed that cybersecurity issues are a little bit in the news these days. But, we’re not here to talk about Russian spies influencing US presidential elections (although that would be an interesting discussion). Rather, we’re here to talk about boring NY bureaucrats, who have just promulgated (for comment) 23 NYCRR 500, CYBERSECURITY REQUIREMENTS FOR FINANCIAL SERVICES COMPANIES that is set to go into effect on January 1, 2017 (yes, that’s less than 3 months from now). The proposed regulation is currently in its comment period and, if adopted, will apply to insurers who do more than $5,000,000 in gross revenue and are regulated by the NY Department of Financial Services. It will also likely serve as the blueprint for other states across the country. So what does the regulation propose to do?

Basically, to prevent and mitigate a “cybersecurity event”, i.e. an act or attempt, successful or unsuccessful, to gain unauthorized access to, disrupt or misuse an information system, a regulated entity (like an insurance company) is obligated to ensure that non-public information (like names, dates of birth and social security numbers) are protected. To do that, you must:

(1) develop and implement a cybersecurity program that includes penetration testing, vulnerability assessments, an audit trail system, access privilege limitations, application security, risk assessments, a data retention policy, encryption of nonpublic information and an incident response plan;

(2) develop and implement a cybersecurity policy that includes training and monitoring;

(3) have a chief information security officer (and other personnel); and

(4) have a third-party information security policy that will apply to all third-parties doing business with the insurer.

But, you might ask, what does this really mean for me? It means that you’re going to need a bigger boat (to paraphrase Jaws) if you want to stay ahead of this shark and avoid fines and penalties by the NY Department of Financial Services (and also avoid lawsuits where failure to follow the NY regulations will serve as a blueprint for what you were supposed to do and failed to do). Insurers and their vendors (like attorneys) have in their possession voluminous amounts of information (like medical records, discovery responses and transcripts) that include non-public information. Yet, how often is such information being transmitted by insurers to their attorneys (and from attorneys to their insurers) in unsecured ways? How many insurers are capable of downloading and adding to their files information that is sent by attorneys in secured ways (e.g. via Sharefile — which is our preferred data transmission method at WCM)? I think the answer is “not as many as you would hope.” We here at WCM are happy to help work with you as to what you need to do (and to do what we can for you to help ensure compliance). But, there’s a lot of work to be done and not a lot of time to start doing it.

For more information about this post please e-mail Bob Cosgrove .

PA Court Finds No Coverage For Leaky Roof Suit

In State Farm Fire and Casualty Co. v. Kim’s Asia Construction, a Pennsylvania court had to determine whether a construction company was entitled to coverage in a suit alleging negligent installation of a leaky roof. Kim’s Asia was hired to remove an existing roof and install a new one. The finished roof leaked during rainstorms, and additional repairs failed to fix the issue and the building owner was forced to hire a new contractor to remove the roof and install another one. Kim’s Asia was sued and it sought coverage for the lawsuit from State Farm. State Farm agreed to defend the case under a reservation of rights and  commenced a declaratory judgment action.

The policy provided coverage for property damage caused by an “occurrence,” which was defined as an accident. In the Pennsylvania Supreme Court’s 2006 ruling in Kvaerner Metals Div. of Kvaerner U.S. Inc. v. Commercial Union Ins. Co. the justices interpreted nearly identical policy language. Applying the dictionary definition of “accident,” which means “fortuitous,” the court determined that property damage claims based on faulty workmanship do not qualify as an “accident” that establishes an “occurrence” where the underlying complaint does not allege anything “unexpected.”

Here, although the complaint included general allegations of negligence, the court determined that there was nothing “unexpected,” “unintentional” or “fortuitous” about the insured’s allegedly poor roof construction. As a result it did not meet the definition of an “occurrence” under the policy and was a faulty workmanship claim that did not trigger coverage.  As such, State Farm had no obligation to defend or indemnify Kim’s Asia in the underlying action.

Thanks to Jorgelina Foglietta for her contribution to this post and please write to Mike Bono for more information.

Register as a Foreign Corporation = Consent to Jurisdiction (PA)

In Bors v. Johnson & Johnson, U.S. District Court denied the defendant’s motion for dismissal and concluded that despite the U.S. Supreme Court’s ruling in Daimler AG v. Bauman, Pennsylvania had personal jurisdiction over the defendants who had consented to jurisdiction by registering in the State.

In Bors, the plaintiff, as administrator of the estate of Maureen Milliken, brought suit against Johnson & Johnson and Imerys Talc American for various product and negligence claims.  The plaintiff alleged that the defendants’ products lead to Ms. Milliken’s ovarian cancer and death.  Ms. Milliken was a Philadelphia resident at the time of her death and during her prior usage of the defendants’ products.  However, Imerys’ only connection to Pennsylvania was its decision in 2007 to register to do business as a foreign corporation in Pennsylvania.  Imerys has no offices, conducts no business, sells none of its products, nor manufactures any of its products in Pennsylvania.  Accordingly, relying on the U.S. Supreme Court’s reasoning in Daimler, Imerys argued that its registration was not enough to submit it to personal jurisdiction.  In Daimler, the court limited general personal jurisdiction over a foreign corporation to where the corporation was essentially at home.

Unfortunately for Imerys, the Daimler court did not address consent to general personal jurisdiction, and Pennsylvania’s rules on personal jurisdiction are pretty unambiguous.  Personal jurisdiction can be established in Pennsylvania if there has been consent to general jurisdiction, general jurisdiction, or specific jurisdiction.  Imerys must have missed the fine print attached to its application to register as a foreign corporation which essentially states that by registering as a foreign company, the company consents to general jurisdiction.  Moral of the story, read before signing or it may cost you.

Thanks to Marcus Washington for his contribution.

For more information, contact Denise Fontana Ricci at dricci@wcmlaw.com.


A & B Exclusion Prevails Over Negligence Claim (PA)

Smart plaintiffs’ attorneys routinely plead negligence against a commercial enterprise for injuries arising out of an assault. The strategy is commonly employed to bring claims, that would otherwise excluded within the realm of the business’s insurance coverage.

In QBE Insurance Corp v. Walters, a café’s insurer sought declaratory judgment that its assault and battery exclusion applied to a claim arising from a shooting in the Jazzland café parking lot. In his underlying complaint, Walters, alleged negligence against Jazzland claiming that the café was located in a high crime neighborhood and that patrons regularly brought firearms into the establishment.  The plaintiff claimed that the café, with knowledge of these facts, was negligent in failing to prevent his injuries.

Jazzland sought defense and indemnity from its insurer, QBE, for the lawsuit. QBE filed a declaratory judgment action, arguing that the policy’s “assault and battery” exclusion barred coverage for the incident. The trial court granted summary judgment to QBE, to which Jazzland and Walters appealed, arguing on appeal that the language of the complaint sounded in negligence as a direct cause of Walters’ injury, thus the assault and battery exclusion was inapplicable to these claims.

The Superior Court of Pennsylvania ruled that the trial court properly granted summary judgment in favor of QBE in the declaratory judgment action and that the assault and battery exclusion barred coverage for Walters’ claim. Notably, the A & B exclusion contained a comprehensive definition of “assault and battery” which placed any negligent conduct on behalf of the insured and their employee’s in connection to an A&B squarely within the realm of the exclusion. Specifically, QBE’s A&B exclusion stated that it applied regardless of degree of culpability with regard to allegations of negligent hiring, training of employees and failure to prevent a claimant’s harm. Furthermore, the definition of A&B under the policy expressly included the negligent employment, investigation, supervision, training and retention of any employees and any insured or employees’ failure to prevent harm.

Based upon the policy’s plain language, the Court found that the exclusion was unambiguous in its intent to exclude any alleged negligence arising out of an assault and battery. Given the Superior Court’s interpretation of the policy at issue, insurers operating in the Commonwealth of Pennsylvania should be advised of the language used in in this case by QBE that encompasses claims that could potentially be disguised as negligence claims.

Thanks to Sathima Jones for her contribution.

For more information, contact Denise Fontana Ricci at dricci@wcmlaw.com.

No Coverage Owed for Junk Faxes (PA)

Junk faxes have now been overtaken by spam email, but a number of statutes were passed to protect the public from harassment by fax, including the Telephone Consumer Protection Act.  A recent federal court case dealt with whether insurance coverage was owed for claims brought under the TCPA.

In Auto Owners Ins. Co. v. Stevens & Ricci, Inc., Stevens & Ricci was a debt collection firm accused of sending junk faxes in violation of the TCPA. While the underlying litigation was pending, the insurer Auto-Owners Ins. Co. commenced a declaratory judgment action against the firm and the class representative. Auto-Owners moved for summary judgment, arguing that the terms of the insurance policy did not obligate it to indemnify or defend Stevens & Ricci in the class action. The class representative cross-moved, claiming that Auto-Owners was obligated to satisfy the judgment entered against Stevens & Ricci, which was for $2 million dollars.

The District Court found that the sending of unsolicited faxes in violation of the TCPA did not fall within the terms of the policy, and granted the insurer’s motion for summary judgment. The class members appealed. The Third Circuit affirmed the denial of coverage, and found that the alleged injuries resulting from the receipt of junk faxes (loss of ink, toner and time) did not qualify as property damage because they were not the result of an “accident.”

The Third Circuit also found that the alleged harm did not qualify as an advertising injury, as the policy’s definition of advertising injury covered only violations of the privacy interests of secrecy, not a violation of privacy if a message is received without permission.

Thanks to Jorgelina Foglietta for her contribution to this post and please write to Mike Bono for more information.

Subway: Eat Fresh, Stay Alert – Subway wins design defect claim on summary judgment (PA)

On July 14, 2016, the Philadelphia Court of Common Pleas granted the defendant’s, Bhagvati Krupa, Inc. t/a Subway (“Subway”), motion for summary judgment against the plaintiff’s claims based on a defective design argument in Santangini v. Bhagvatic Krupa, Inc t/a Subway.  Specifically, on September 20, 2013, the plaintiff, Geraldine Santangini, was a customer in a Subway store located in Center City Philadelphia.  After purchasing her food, the plaintiff went to the self-serve soda fountain to fill her drink.  Thereafter, the plaintiff turned towards the door to leave the store, took a step and fell down two steps that led to the exit.  The plaintiff alleged certain injuries as a result of the fall.

The plaintiff filed suit against Subway for her injuries, alleging that the Subway restaurant was defectively designed.  Notably, the plaintiff alleged, inter alia, that the Subway restaurant was defectively designed because there was an unguarded ledge directly next to the self-service soda machine and the design caused an overcrowded condition in certain areas.  After discovery was completed, Subway filed a motion for summary judgment on the basis that the plaintiff failed to establish a prima facie case of negligence because the plaintiff did not obtain an expert to establish that the Subway was in fact defectively designed.

In deciding the motion for summary judgment, the trial looked at whether the issue of negligence could be determined by a layperson or whether it required a special skill or knowledge.  If the former was true, no expert would be needed; however, the latter would require an expert.  Here, looking at the issue of whether the Subway store was defectively designed, the trial court found that expert testimony was “indispensable” for the plaintiff’s claims against Subway.  Specifically, the trial court stated that there were too many variables to take into consideration for a layperson to make a sound and reasoned decision, such as whether designing a restaurant with a step drop off instead of a ramp or gradual incline was negligent.  Accordingly, Subway’s motion for summary judgment was granted and the trial court urged the Pennsylvania Superior Court to uphold their decision on appeal.

Thanks to Erin Connolly for her contribution.

For more information, contact Denise Fontana Ricci at dricci@wcmlaw.com.

Property Owner Gets By With a Little Help From His Friends (PA)

On July 13, 2016, a Luzerne County jury found for the defendant in a sidewalk slip-and-fall on ice case due to the ability of the defense to present solid witness testimony from non-party witnesses.

In Donald Pachucki v. James Farrell and Michael Farrell, the plaintiff allegedly fell on a patch of ice on sidewalk in front of residential rental property.  A municipal worker, he had been in the course of his employment collecting debris when he fell.  He alleged that the property owner had failed to clear the sidewalk and produced photographs he claimed had been taken hours after the incident to prove his claim.  Pachucki sued the property owner/landlord of the property where he fell on the theory that they were negligent in maintaining the property.

At trial, the defendants were firm that the sidewalk was clear on the day of Pachucki’s fall.  The property owner had an agreement with one of the tenants to remove snow and ice on the property.  That tenant testified that he and his eight children regularly shoveled and applied salt and that they had done so that day prior to the incident.  Another neighbor boosted this testimony, describing the efforts the owner took driving by the property up to three times a day to verify that it was properly maintained.  He described the defendants as meticulous in their maintenance of the property and confirmed that the sidewalk was certainly clear on the day of Pachucki’s fall.

The defendants questioned the plaintiff’s photographs suggesting that snow on the sidewalk could have accumulated due to activity of children walking from a neighboring school.

The jury was persuaded by the testimonials and found in favor of the defendants.

Thanks to Melanie Brother for her contribution.

For more information contact Denise Fontana Ricci at dricci@wcmlaw.com.