Experience Archive

Following a week-long hearing, a three-person Panel of Arbitrators dismissed Claimant's allegations that WSHB's client violated several provisions of state and securities laws, seeking $1.4 million in damages, in favor of our client.

In a case of first impression, the New Jersey Supreme Court in Norman International, Inc., and Richfield Window Coverings, LLC d/b/a Niem Made (USA), Inc. v. Admiral Insurance Company, 251 NJ 538 (2022) enforced a Designated New York Counties Exclusion included in a commercial general liability insurance policy issued by Admiral Insurance Company ("Admiral"). In so holding, the Supreme Court found that the policy's broad and unambiguous language did not require a causal relationship to trigger the exclusion. Rather, any claim "in any way connected with" the insured's operations in an excluded county fell within the exclusion. Additionally, Admiral had no duty to defend a claim that it was not obligated to indemnify. The determination of whether Admiral had a duty to defend was not determined solely by the allegations of the complaint. Instead Admiral relied upon facts adduced during discovery indicating that in certain instances an insurer may use extrinsic evidence to deny a defense to its insured. The Supreme Court recommended that going forward, in similar situations, courts should indicate when an issue requires consideration of facts beyond the complaint.

A New York City eviction court denied a motion for summary judgment, ruling that a tenant in a polyamorous relationship with the lease holder was entitled to the same eviction protections as those in two-person relationships. In its denial of summary judgment, the court found that the holdover tenant may be entitled to take the lease in his name after the death of his partner. What could the recognition of polyamorous relationships mean not only for property disputes in the future, but for employers and insurance carriers moving forward?

Washington state courts favor enforcing contractual arbitration clauses, and will strictly enforce an LLC operating agreement to arbitrate claims, including derivative claims, where agreement language is broad enough to include the same. Moreover, a contractual arbitration clause will be enforced absent evidence clearly indicating waiver of an intention to arbitrate.

Determining appropriate policy limits is no easy task. On one the hand, an insured has motivation to keep its retentions, deductibles and premiums down to a reasonable level. On the other hand, that fiscal interest is balanced against the security found in high policy limits designed to protect against a potential serious claim that requires a large payout. Often clients rely on the advice of a broker to help them select appropriate limits and policy terms. When claims come in the door, and the limits are insufficient to cover the damages, the broker may find themselves in the crosshairs of an angry client liable for damages not covered by their policy - and open the door for claims of professional negligence against the broker. Whether an insurer is obligated to defend and indemnify the broker against a claim of professional negligence is a question of policy interpretation recently addressed by the Ninth Circuit in Bliss Sequoia Ins. & Risk Advisors v. Allied Prop. & Cas. Ins. Co., No. 20-35890 (9th Cir. Oct. 27, 2022).

Courts must abide by the terms of arbitration agreements that invoke the governance of the Federal Arbitration Act (FAA), or contain a clearly written delegation clause. Terms that provide for an arbitrator to decide threshold issues may not be sidestepped or ignored by state courts. This is true even if the district court finds that the subject of the dispute is not within the scope of the arbitration agreement.

King County alleged that a judge was openly hostile to an attorney during a jury trial that resulted in the jury having negative feelings toward the defense. The court ruled that the audio recordings were not subject to disclosure as public records. The lack of transparency and accountability could make for a troublesome precedent.

An Illinois appellate court recently held that a patient's medical privacy rights were violated after the attorneys who secured him a $4.2 million verdict released details of his condition and medical history in the media after the trial concluded.

In quite a scolding for defense counsel, the court in Shapell Socal Rental Properties, LLC v. Chico's FAS, Inc., found on appeal that attorneys have both an ethical and statutory duty to notify opposing counsel of an intent to seek a default. The fact that one party failed to pay rent and pushed the envelope due to COVID closures did not change the obligation of professionalism between legal teams.

The Supreme Court of Washington found that the interruption of a dental office's business operations, caused by the COVID-19 shutdown and restrictions, did not constitute a physical loss under the property insurance policy. Although the dentists' argument that they should succeed under the "loss of functionality" theory was considered by the court, it still found in favor of the insurer because the dental office premises were not physically harmed and, in fact, the office was still functional and being used for emergency dental procedures. The policy also contained a virus exclusion. The efficient proximate causation theory did not assist the plaintiffs because the initial peril in the causation chain (the COVID-19 virus) was excluded under the policy.

New Orleans restaurant wins ground-breaking case in which an appellate court ruled that shut-downs and partial closures due to COVID-19 particles invading a restaurant's physical space may constitute direct physical loss sufficient to trigger coverage under an all-risks insurance policy that did not contain a virus exclusion.

When a property insurer pays for losses under a first-party property insurance policy, they are often paid at actual cash value. Actual cash value is calculated by taking the replacement cost, i.e., the amount it would cost to repair or replace an item of similar kind and quality, less depreciation, i.e., the decrease in the property’s value because of use, wear, obsolescence, or age. For an insurer, this often begs the question, what costs are depreciated when calculating actual cash value?

In a high-profile, high-exposure products liability case involving allegations of a defective cannabis leaf trimmer that caused serious injuries, the United States District Court for the District of Colorado granted summary judgment in favor of the manufacturer. WSHB partner Ryan Hicks and his team prevailed in navigating this victory.

In a recurring issue of statewide importance, the Supreme Court of Arizona in Zambrano v. M & RC II, LLC, No. CV-21-0205-PR (Sept. 28, 2022) decided that it is against public policy to waive or disclaim the implied warranty of workmanship and habitability in a purchase agreement with a homebuyer. This rule extends to circumstances in which a builder simultaneously provides express warranties providing similar protections.

If a lawyer is not licensed in California but practices law as part of a team of licensed California lawyers, is this enough to invalidate the arbitration agreement between the client and California law firm? That question was squarely answered by California’s Fifth Appellate District in its recent decision in Brawerman v. Loeb & Loeb, LLP. 297 Cal.Rptr.3d ----, 81 Cal.App.5th 1106, 2022 WL 3053302, 2022 Daily Journal D.A.R. 8347. The work performed by an unlicensed attorney that is completed in conjunction with a team of properly qualified attorneys does not invalidate the retainer agreement as a whole, the court concluded. Any allegedly “illegal” work performed by the unlicensed attorney can be severed from the work performed by licensed counsel, thereby allowing the agreement between the parties to be preserved. Since the retainer agreement was not inherently illegal in its inception, its provisions, including the arbitration agreement, can withstand an alleged partial illegality. See, Birbrower, Montalbano, Condon & Frank v. Superior Court (1998) 17 Cal.4th 119 (Birbrower).

A Hollywood producer was not held vicariously liable for the negligent activities of his personal chef in supplying the entourage's executive assistant with drugs and alcohol that contributed to her demise. The court reasoned that the rendezvous between the chef and the assistant took place after hours, in a private bungalow and was not related to the chef's scope of employment.

Sometimes the defense is so strong that the case is gutted before it makes it to the jury. That is the result in a Santa Barbara matter where WSHB trial lawyer Frances O’Meara prevailed on her motion for a directed verdict following plaintiff’s case in chief. Focus on this case now moves to cost recovery given the result and beating the statutory offer to compromise.

When two companies both catering to the rich and famous of Orange County tried to merge, and failed, litigation was bound to ensue. Thankfully, for one of the companies, Rebecca Gabroy was the trial lawyer.

The exact moment a statute of limitations begins to run is not always black and white. In a case where water and mud were directed onto a property by an adjacent property’s construction project the Texas Court of Appeals, basing its holding on accrual of nuisance claims rather than accrual of a negligence action, found that the two-year statute of limitations did not accrue until property damage occurred, even though plaintiff knew at a much earlier date that the condition might cause property damage.

This case underscores the importance of interrogatory answers, and attempts to be evasive can come back to bite. In the case of Field v. U.S. Bank National Assn. as Trustee, etc., et al. (2022) 79 Cal.App.5th 703, the California Court of Appeals addressed the issue of evasive discovery responses where a plaintiff who filed a wrongful foreclosure claim could not change a deliberately evasive interrogatory answer in an effort to defeat a motion for summary judgment filed against her by the defense.

A commercial general liability (CGL) insurance policy that contains a requirement that the loss occur and be reported by the policyholder within the same policy year, and does not include retroactive coverage was in violation of Washington public policy. In Preferred Contractors Ins. Co. v. Baker & Son Construction, Inc., 2022 Wash. LEXIS 426(Aug. 11 2022), the court looked to RCW 18.27.050 which provides that registered contractors bear financial responsibility for bodily injuries and death, and found that a denial of coverage a policy stemming from a wrongful death on a construction site was contrary to the statutorily-supported public policy of protecting the public.

In Khalil v. Williams, et al., the Supreme Court of Pennsylvania held that attorneys who may have engaged in fraud in connection with the execution of a release may not shield themselves from potential liability based on the Court’s holding in Muhammad v. Strassbruger, McKenna, Shilobad & Gutnick, 587 A.2d 1346 (Pa. 1991) which stands for the proposition that attorneys cannot be liable on legal malpractice claims when clients change their minds about the sufficiency of a negotiated settlement.

The insured was not entitled to recovery under a professional errors and omissions policy for a loss resulting from a hacking incident. Considering both North Carolina and Pennsylvania law, the court found that coverage was barred by the insurance policy's unauthorized computer use exclusion as well as the insured's failure to comply with the condition to obtain insurer consent before finalizing all settlements. Constr. Fin. Admin. Servs. LLC v. Fed. Ins. Co., No. 2:19-CV-00020, Doc. 63 (E.D. Pa. June 9, 2022).

In Viking River Cruises v. Moriana, B297327 (Cal. App. Sep. 18, 2020), the issue before the court was whether a pre-dispute arbitration agreement under the Federal Arbitration Act ("FAA") purporting to require arbitration of any such claim is valid. The decision effectively invalidates longstanding California law precluding arbitration of any Private Attorneys General Act (PAGA) claim, and will have massive positive repercussions in favor of employers.

Schools must take reasonable steps to protect their students from foreseeable injury inflicted by third parties. A trip to Starbucks after track practice did not relieve the school of its duty to a student when she returned to school and was stabbed on campus. The school had a "special relationship" with the student under the law and owed her a heightened duty of care while she was present on campus during open hours.

The Arizona Supreme Court ruled that treating physicians who have personal and direct knowledge of the patient in question and who testify as to the standard of care, diagnosis, and treatment for that patient are not considered experts for purposes of the One Expert Rule. Further, the One Expert Rule's purpose is to reduce costs in presenting multiple expert witnesses rather than combating cumulative evidence, which is already addressed by Rule 403 of the Arizona Rules of Evidence.

People suffer injuries on other people's property all the time, but the responsibility to keep them safe may be legally delegated to an independent contractor. In this influential Washington court decision, Eylander v. Prologis Targeted U.S. Logistics Fund, No. 82834-7-I (Wash. Ct. App. Jul. 18, 2022), the court ruled that a landowner must take reasonable steps to ensure the safety of an independent contractor's employees on their property, but may delegate that duty if they exercise reasonable care to ensure that the independent contractor will protect their own employees against known or obvious dangers.

A mother's claim against the City of Peoria for an incident resulting in the death of her son was not invalidated due to the inclusion of a shortened settlement window in her notice of claim. The Arizona Supreme Court in James v. City of Peoria, No. CV-21-0125-PR (Ariz. Jul. 18, 2022), found that a notice of claim otherwise in compliance with A.R.S. §12-821.01 is not invalid because it attempts to set a deadline for settlement prior to the sixty-day period outlined by the statute. The action was a legal nullity.

In another defining decision regarding ostensible agency, the Court of Appeal in De Valle v. Doctors Med. Ctr. of Modesto, No. F082099 (Cal. Ct. App. Jul. 6, 2022) found in favor of a defendant hospital. Based upon this recent decision, a patient’s claim for injuries against a hospital based upon ostensible agency for negligent surgery performed by an independent contractor will fail when it is demonstrated that the patient had a pre-existing relationship with the physician, that such physician scheduled the surgery and selected the hospital where the surgery would be performed, and that the patient should have reasonably known that the hospital was simply the venue for the surgery.

A gym member's claim of negligence, gross negligence and premises liability was shot down by the court when it found that she signed a release of claims as part of her membership agreement. A slip and fall in the gym's sauna as a result of a burnt out light bulb did not rise to the level of gross negligence to subject the club to liability.

A court invalidated an arbitration agreement as unconscionable and adhesive where it was presented to an employee as a condition of employment. The agreement was found procedurally unconscionable because the employee spoke Spanish and was only provided documentation in English, without any offer of translation or assistance in understanding the document. The agreement was also found substantively unconscionable because it permitted the arbitrator to shift all attorney's fees and costs to the employee in the event the employee was the losing party and severely limited discovery.

Washington’s Court of Appeals held an owner of land who did not exercise control over the manner of work on a worksite was not vicariously liable for the death of an employee of one of its general contractors. The decision handed down on June 21, 2022, in Farris, et al. v. The Port Blakely Company, et al. is instructive on common law and regulatory scheme establishing the line dividing responsibility between landowners and contractors performing works of improvement.

The standard statute of limitations for a party to bring a personal injury or wrongful death actions is two years. There are, however, circumstances in which the statute of limitations for such causes of action are extended. The victim of a felony in California, for example, has an extended statute of limitations in which to bring an action for personal injury or wrongful death against the person convicted of that felony. (Code Civ. Proc., § 340.3) In Cardenas v. Horizon, the California Court of Appeal made a notable ruling limiting the extended statute of limitations, holding such an extension does not apply to the convicted felon's employer. The Court further held that Labor Code section 2802, which allows an employee to be indemnified by his or her employer, does not apply to third parties in this circumstance.

The California Court of Appeal ruled that a general liability policy does not provide coverage to a homeowner who grades a neighbors' property because of a mistaken understanding of the property lines. The homeowner’s policy contained standard language creating coverage for property damage caused by an “occurrence,” which the policy defined as an “accident.” The insurer did not have a duty to defend the policyholder because a mistake as to property lines did not qualify as an accident and trigger coverage under the policy.

The Texas Supreme Court found in In re UPS Ground Freight, 65 Tex. Sup. Ct. J. 1532 (Tex. June 17, 2022) [20-0827] that a discovery request in a wrongful death action compelling production of the drug tests and other personal information of uninvolved UPS drivers was overbroad and prohibited by federal law.

Dick Poe was the only director of Poe Management, Inc. (PMI). As part of that role he authorized the issuance of 1,100 shares of PMI stock, which he purchased for $3.2 million. Prior to the issuance of these shares, Dick's son, Richard, was PMI's only shareholder. Richard did not have knowledge of the issuance until after Dick's death and at that point he brought suit to invalidate the share issuance.

In a recent decision, the Illinois Supreme Court found that an employer's acknowledgement of vicarious liability can no longer prevent a plaintiff from filing negligence claims directly against the employer. Prior to this decision, employers were shielded from independent, individual claims of negligence and could only be vicariously liable for the negligence of their employees, with certain exceptions. Employers and their legal counsel as well as insurance adjusters should take note of this important development.

New Jersey Supreme Court excludes application of rule relieving plaintiffs who bring premises liability claims against businesses that employ self-service models of the burden of proving actual or constructive notice of a dangerous condition to produce sold in sealed containers.

Following an eight-week bench trial, plaintiffs dropped its $6 million dollar plus demand and accepted a dismissal with a cost waiver. This trial victory, led by WSHB trial lawyer Rebecca M. Gabroy, underscored a hard fought battle in a complex defamation, breach of contract, lost profits and punitive damage case which endured many failed mediations.

Following a protracted trial, an Orange County jury handed an impressive win for WSHB trial lawyers Sheila Fix and Greg Amundson in a habitability case. Notably, this trial started on March 29 and the verdict was handed down almost three months later.

Senate Bill S74A, also known as the “Grieving Families Act” (“GFA”) is set to vastly expand compensable damages in wrongful death actions. Currently, compensable damages in these types of actions are limited to pecuniary loss only, such as pre-death medical expenses, funeral expenses and loss of financial support.

In the past several years, Florida homeowners have accounted for somewhere between 65 to 80 percent of all property lawsuits filed nationwide. In just this calendar year, insurers in the Florida market have either stopped writing business or have gone under. For instance, since February 2022, at least three insurers – Lighthouse Property Insurance, Avatar Property & Casualty, and St. John’s Insurance Co. – have been declared insolvent.

Following a three-week trial, a Los Angeles jury rejected a $45 million demand for a fatality in a jet ski accident in favor of Wood, Smith, Henning & Berman’s client.

In another victory for the team at WSHB, partner Ranjan Lahiri and senior counsel Sarah Spaulding obtained an outstanding verdict for the client, defeating Plaintiff’s 998 offer. Plaintiff who was injured while inside a self-storage unit demanded $1,175,000 in damages.

By way of a recent Arizona Supreme Court holding, Arizona law continues to support the legal conclusion that non-contracting parties cannot maintain a cause of action sounding in negligence for purely economic damages. Cal-Am Properties Inc. v. Edais Eng’g Inc., CV-21-0129-PR, 2022 WL 1613497, at *5 (Ariz. May 23, 2022).

In a trifecta of good news for defense attorneys, three separate cases in the New York Court of Appeals were decided in favor of insurers in bodily injury construction claims. Although it may not yet be considered a trend, a positive decision for the defense, especially in traditionally plaintiff-friendly counties, is good news for insurance companies and the attorneys who defend them.

 Another trial “first” for national law firm Wood, Smith, Henning & Berman last week when a Los Angeles jury returned the verdict. Tried by sibling partners, Tracy and Paul Lewis, this case represents a brother-sister trial duo that defeated plaintiff’s claim for over $2.4 million. 

In a widely-anticipated decision, the Massachusetts Supreme Judicial Court unanimously held that where a franchisee is an “individual performing any service” for a franchisor, the three prong test set forth in the independent contractor statute applies to the relationship between a franchisor and the individual and is not in conflict with the franchisor’s disclosure obligations prescribed by the FTC Franchise Rule.

Appellate Division revokes case law carrying a presumption that third-parties or recording devices are allowed in the examination room for psychological defense medical examinations, but require plaintiffs to show “special circumstances” warranting third-party observation or recording of physical examinations.

After decades of debate, the reform of medical malpractice claims in California is finally coming to fruition. Legislators and interested parties on both sides of the MICRA debate have reached a compromise and agreed to a deal that will avert a planned ballot measure in the upcoming election.