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Employee's Surfing Pornographic Web Sites At Work Lands Employer In Hot Water

Trends usually start in California, or so we on the Left Coast would like to believe.  New Jersey, however, proves this adage wrong with a recent employment law decision that requires employers to stop an employee's internet porn surfing. 

The Appellate Division of the Superior Court of New Jersey decided, "that an employer who is on notice that one of its employees is using a workplace computer to access pornography, possibly child pornography, has a duty to investigate the employee's activities and to take prompt and effective action to stop the unauthorized activity, lest it result in harm to innocent third-parties. No privacy interest of the employee stands in the way of this duty on the part of the employer."  Here, the employee's wife sued the company for allowing her husband's to upload a picture of their naked daughter to a child pornography site, and the appellate court reversed the trial court's decision dismissing the case.  The trial court found that the employer had no such duty to monitor its employee's internet surfing, but the higher court disagreed.

The case will now proceed to trial.  It's a tough standard to hold employers to, and most employment lawyers have decried the outcome of the case because of the extra burden it places on employers.  In a case of bad facts make bad law, though, you might not be surprised at the outcome given the involvement of child pornography.  That subject is an easy target for courts -- imagine the civic backlash if the court hadn't taken such a step to protect the child at risk.  What makes it doubly troubling, however, is the involvement of the child's stepfather.

Even so, in this case, the employer knew that the employee was visiting porn sites, yet apparently did nothing affirmative to stop the employee's surfing, except to warn the employee to stop.  The employer admitted that it had the software and technical capability to "turn off" the employee's access to the pornographic sites, but did not do so.  That fact was most likely the tipping point for the court's decision, but if you have specific questions about this case, you should contact a New Jersey lawyer.  According to the Court's opinion, the company had a policy not to monitor employee's computers, but at the same time, it had received complaints from other employees about the husband-employee's viewing of pornographic images on his computer.

This type of case hasn't yet been addressed by California courts, but there's no reason to doubt that if a similar set of facts came in front of a court here, the decision would likely be the same.  While MIPTC won't predict the outcome of the New Jersey case, a case like that here would have a difficult time overcoming the burden of proof to show proximate cause of the damages to the couple's daughter since some of the same activity happened on their home computer. 

Nonetheless, employers may want to review their internal policies on privacy and pornography.



Podcast 

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Wednesday, January 11, 2006 at 11:40. Comments Closed (0) |

Pollution Coverage Exclusion Narrowed By Maryland Courts

The pollution exclusion has long been waved as a banner by insurance companies to preclude coverage for a myriad of pollution-related ills, keeping your premium and not paying claims.  In Maryland, however, another chunk just got removed from that wall of impenetrability.

The Maryland Court of Appeals ruled that the total pollution exclusion does not bar liability coverage for an injury suit arising from workplace exposure to welding fumes.  U.S. Fire Insurance Company initially denied claims filed by two of its insureds, Clendenin Brothers Inc. and Nichols Wire, Inc., for personal injury lawsuits filed by workers allegedly exposed to welding fumes, and it's a case we've been watching with interest for some time, along with the entire industry.

According to the Court, the certified question asked to it by the U.S. District Court for the District of Maryland was based on suits brought by plaintiffs against Clendenin and Nichols who allege that proper use of the insureds' welding products produced harmful localized fumes containing manganese, which caused bodily harm and neurological damage.  The insurance company filed a declaratory relief action, seeking to avoid defending its insureds. 

Now, however, USFC has to cover the claim, and repay Clendenin and Nichols for itheir costs to defend these suits.



Podcast 

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Tuesday, January 10, 2006 at 13:14. Comments Closed (1) |

Coffee Wars: Mr. Charbucks vs. Starbucks

You might be able to order a "short cappuccino" at Starbucks, but the retailing giant is big on enforcing its trademark.  So much so that a small New Hampshire coffee company, the self-styled Black Bear Micro Roastery's cup of "Mr. Charbucks," ran headlong into trouble with Starbucks over its similar-sounding name. 

Black Bear Coffee offers this page on its website with details of the litigation between the big company and their small company.  Starbucks' press page offers no comment.  Court TV interviewed the owners of Black Bear Coffee, who commented, "We're so small that there's no way, even if we wanted to, that we could cause harm to Starbucks," Jim Clark told Courttv.com in a telephone interview. "They did not have to go to this extent to police their trademark."

The opinion, not up on the U.S. District Court for the Southern District of New York's website, stated (according to Court TV), "The court finds, based on the distinctive packaging and the separate retailing channels of the parties' respective products, that an ordinary purchaser is very unlikely to mistake defendant's 'Mr. Charbucks Blend' ... for one offered by Starbucks," wrote Judge Laura Swain. 

You make the call:  here's Black Bear's Mr. Charbucks (photos of the actual blend not on the site).  You likely already know what a Starbucks coffee looks like.



Podcast 

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Monday, January 09, 2006 at 13:43. Comments Closed (1) |

CHP Hands Out IOUs for DUIs

Now that New Year's Eve has come and gone, there may be a few people out there who receive bills from the California Highway Patrol (link has music) for the pleasure of having been arrested for DUI (driving under the influence).  Not only will this experience cost between $10 to $15,000 in legal fees and costs, additional insurance premiums, lost time from work, classes, probation, court fines and the like, offenders now get bills from the CHP for their time.  If someone you know is in this situation, here's a primer for what you can expect from the CHP.

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Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Sunday, January 08, 2006 at 07:04. Comments Closed (0) |

Government Loses Big Battle Over Excessive Developer Fees

Right before Christmas and Hanukkah last year, the California Supreme Court quietly issued a decision that will have long-reaching effects across the state, perhaps to the point that cities and counties may raise taxes for fees they can't now collect from builders (and consequently new home buyers).  Builders have long groused about both the time it takes to get land development approval and the costs.  One builder, however, recently chose to challenge one City's fees as excessive.

The builder won.  In a big way.

Barratt American, a Carlsbad builder somewhat new to California, claimed that it had paid more than $143,000 in building permit and plan review fees for at least 83 building permits for the construction of single-family homes, or $1,722.89 per home.  The City's ordinances allowed it to charge $550.50 per home.  Barratt claimed that the City of Rancho Cucamonga had collected more than $1,000,000.00 in excess building fees in one year from all builders, and sought a refund of the money it had paid in.

While the City succeeded in its argument that four of five causes of action Barratt filed should be dismissed.  It didn't succeed, however, in the most important of the five:  the one cause of action that asked for a refund of excess fees.  Ultimately, the decision will lead to lower new home prices to consumers, and lower revenues to cities.  Barratt has a similar case against the City of Encinitas pending before the Supreme Court, which now will most likely be handled the same way.

Cities and counties across California now need to readjust their fee, accounting and audit structure to meet the requirements explained by the California Supreme Court.  Essentially, cities must now price their fees commensurate with the cost of providing the services of planning review to obtain development permits to meet the Court's edict.

In government-speak, that result means less money coming in to local government, even though the fees are supposed to cover costs.  Does that mean that with less revenue, local governments will now try to raise taxes elsewhere to cover the lost revenue?  Let me put it this way:  how many times have we seen taxes go down?



Podcast 

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Saturday, January 07, 2006 at 13:23. Comments Closed (2) |

Review Of New 2006 Legislation For California

Attorney James Toledano from Santa Ana gave his twenty-sixth annual presentation of new laws of interest to California business litigators at the Orange County Bar Association Business Litigation Section meeting today.  Jim was kind enough to give me permission to post his review, subject to his wonderful disclaimer below, for your use:

Small Claims (CCP § 116.221, etc.)

Raises jurisdictional limit, for individuals only, to $7,500, requires itemization of debt and payments, raises fees, requires pro-tems to pass law and ethics course every three years, modifies deadline for cases to be heard, limits recoverable costs of service of process, limits court's power to correct decision.

Sanctions (CCP §§ 128.6, 128.7)

Removes the hold on sanctions under CCP § 128.6 (which replicates § 128.5 as to current cases) and makes § 128.7 no longer subject to automatic repeal.

Disqualification of Judge Who Discusses Employment with "Neutrals" (CCP § 170.1)

Abrogates interpretation of law in Hartford Casualty Ins. Co. v. Superior Court (C3 Entertainment, Inc.) (2004) 125 Cal.App.4th 250, 254-258 (rev. granted 2005) in which the Court of Appeal read the law expansively to disqualify judges who had contacts with ADR providers or those who worked for them.

Statute of Limitations, Discrimination Involving Violence (CCP § 338)

Amends three-year statute to add violations of Civil Code § 51.7, a part of the Unruh Civil Rights Act that makes acts of violent discrimination unlawful.

Insufficient Filing Fee (CCP § 411.21) [eff. July 19, 2005]

Provides that insufficient fee for first paper is grounds to void filing, sets procedures.

Service of Subpoena in Gated Community (CCP §§ 415.21)

Adds service of subpoena as basis to gain entry to gated community, but does not affect existing law as to substituted service on guard.

Proof of Service (CCP §§ 412.10, 417.30, 583.210, etc.)

Provides that clerk is to retain original summons and replaces requirement of "return of summons" with requirement that proof of service of copy of summons be filed.

SLAPP Motion Hearing Date (CCP § 425.16)

Makes it the duty of the clerk, not the party, to set SLAPP motion within the 30-day period and abrogates contrary Court of Appeal decisions.

SLAPPback Motions (CCP § 425.18)

Imposes regulations and sanctions analogous to anti-SLAPP law on motions to strike causes of action arising out of the grant of a SLAPP motion in an earlier action.

Injunctions Against Violence (CCP §§ 527.8, 527.10)

Expands effect of injunction against violence by employee against employer, prohibits person against whom any personal injunction is granted from legal access to personal records of person granted the injunction.

Offers to Compromise (CCP § 998)

Sets out specific terms to be included in 998 offer and provides that written acceptance may be made by attorney.

Electronic Summons (CCP § 1010.6)

Requires court to issue official summons upon request of party electronically filing complaint.

Subpoenaing Personal Consumer Records (CCP § 1985.3)

Provides that consumer need not give notice to self when subpoenaing own records.

Mediation Pilot Program Rules (Rules 1640-1640.8, CRC)

Repealed.

Unruh Civil Rights Act (Civ. Code §§ 51, 51.7, 51.8, 52, 53)

States that civil rights law bars discrimination and violence arising from marital status or sexual orientation, that this is intended to clarify, not change, existing law and adds definitions of certain terms.

Mobilehomes (Civ. Code§§ 798.19.5 ff.)

More changes in mobilehome regulatory law.

Disclosure of Supplemental Tax Bills (Civ. Code § 1102.6c)

Requires seller to disclose possibility of supplemental tax bills.

Form of Acknowledgment (Civ. Code § 1189)

Requires acknowledgments to be exactly as provided by statute.

Financial Record-keeping and Disclosure, HOA (Civ. Code §§ 1357.120 ff)

Continues process of regulating the conduct of homeowner associations.

HOA Liens for Assessments (Civ. Code §§ 1367.3, 1367.4)

Greatly limits power of homeowner associations to record liens for unpaid assessments.

Discrimination in Approval of Changes in Occupied Residence (Civ. Code § 1378)

Applies Fair Employment and Housing Act to decisions to approve or reject proposed owner's changes or modifications to residence.

Postponement of Foreclosure Sale (Civ. Code §§ 2924b, 2924g)

Permits postponement of foreclosure sale for a total of 365 days, rather than 3 times, before new notice of sale required; provides that email address is not an "actually known address" for valid service.

Motor Vehicle Purchase Contracts (Civ. Code § 2981, 2982, 2982.2)

Provides for further disclosures in motor vehicle purchase contracts.

Stop Notice Releases (Civ. Code § 1936)

Provides manner in which a stop notice release may be made enforceable.

Filing fees (Gov. C. §§ 70600ff; various provisions of CCP)

Filing fees have generally been made reasonably uniform, and of course increased. Exceptions are where a county (e.g., Riverside) has an added fee to pay for courthouse construction. In addition, as part of the state takeover of the courts system, makes all fees payable to the court, rather than to local jurisdictions.

Clean-up (generally)

There were the usual clean-up laws (three, again this year), this time correcting such things as references to the proper section of the Discovery Act, as amended effective last July 1.

DISCLAIMER:

"The selection of the statutes described, and the descriptions thereof, are the choice solely of the author of this document. His opinions, biases and other ideas are solely his responsibility and are not that of the Orange County Bar Association, the Business Litigation Section thereof, or of any person to whom he may be related or connected by blood, former marriage, potential marriage, domestic partnership or civil union, friendship, former friendship, former partnership, or past or future political or any other affiliation, nor of his former campaign committee(s) or, for that matter, any rational person."

Just as an FYI, Jim Toledano selects new statutes of interest to business litigators.  This list does not include all new statutes for this coming year, and not all those that may be of interest to business litigators, either.  There are other changes to the law not included here, so consult with your favorite attorney if you want to know more.  Remember too, these are only summaries, not the actual laws. 



Podcast 

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Friday, January 06, 2006 at 18:14. Comments Closed (0) |

Butterflies Or Buggies? Tough Choices For Nevada Sand Dunes

It's a fair bet that we're not going to run out of dune buggies or off-roaders anytime soon.  According to environmentalists, however, we are going to run out of the Sand Mountain Blue Butterfly, which has a life span of about a week.  Back in April 2004, the environmentalists filed a petition to designate the Butterfly as endangered, but the United States Fish & Wildlife Service has done nothing in response, allegedly due to a lack of funds.

Today the Center for Biological Diversity and a coalition of other environmental groups filed a Complaint against the USF&WS to force listing the Butterfly as an endangered species and designate the Sand Mountain Recreation Area in western Nevada as critical habitat.

The off-roaders counter that off-road space is just as endangered.  AP writer Scott Sonner asked Richard Hilton of Reno, a board member of the Friends of Sand Mountain, a group of off-road enthusiasts, who replied, "If it did become listed, no telling what type of restrictions they could do out there."

According to environmentalists, critical habitat designations don't have any effect other than requiring those who want to use the designated area to consult with federal agencies regarding the consequences of use of the area.  While technically that's true, it ignores the practical result:  after a critical habitat designation, there is limited or no use of the designated area.

In a CBD press release on the Complaint, Daniel R. Patterson, Desert Ecologist with the Center who formerly worked with BLM said, “This attractive blue butterfly lives only at Sand Mountain, BLM [Bureau of Land Management] is unethically letting its dunes habitat be destroyed by off-road access, and the Bush administration won’t even follow the law to read our petition and consider protection.  The Sand Mountain blue and other dunes endemics are a beautiful part the Great Basin Desert, and only the protections of the Endangered Species Act will ensure their survival and recovery.”

In this case, the Butterfly resides in the Kearney Buckwheat shrub, which covers about 1,000 acres of the 4,795 acre recreation area.  While it may seem that distinction would allow off-roaders to co-exist on the remaining 3,795 acres, a critical habitat designation would likely encompass the entire site.  Sometimes, although not always, the Service requires as much as a four-to-one designation to protect a species.  That means here, there would be 795 acres left for off-roaders.

That leaves off-roaders to claim they're the ones that are becoming endangered.  The Center for Biological Diversity claims that Nevada dunes are not the only ones that need protection.  California's Tolowa Dunes State Park contains critical habitat for the snowy plower bird that will be damaged if off-roaders are allowed back on the land, according to the group.



Podcast 

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Thursday, January 05, 2006 at 12:30. Comments Closed (0) |

Who Owns Baseball Statistics?

It's well past the bottom of the ninth, and the boys of summer have long ago left the mound, but that hasn't stopped Major League Baseball from trying to wring a few more dollars out of last season.  MLB has decided to attack fantasy baseball

Yep, it gives a whole new meaning to Rotisserie leagues

According to LA Times writer Greg Johnson, a fantasy baseball game operator, CBC Distribution & Marketing has filed a complaint against MLB, arguing that MLB cannot force it to obtain a license to plug baseball stats into its games.  MLB claims it owns the numbers, or perhaps more accurately the statistics of baseball.  I don't play fantasy baseball, but I have a lot of friends who do, and most of them are attorneys.  You can count on numerous amicus curiae briefs being filed in this case, most likely in favor of CBC, and against MLB.

It's hard to imagine that MLB will be successful in its claim that it owns the statistics of the game.  They're numbers, right?  On the other hand, there are several cases out there about the alphabet, and some intellectual property rulings side in favor of companies owning part of the alphabet, in certain configurations.  But I can't fathom that one through one thousand, or any of the other myriad statistics thrown out at baseball games (pun intended) can be the property of those who play the game.  It would be like Webster's claiming that I have to obtain a license to write this blog because they first trademarked the words in their dictionary.

Next thing you know, they'll be charging the fans to quote statistics to one another.  Nah.  Numbers (and letters and words) are owned by the people, not the major leagues.



Podcast 

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Wednesday, January 04, 2006 at 12:34. Comments Closed (1) |



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