May It Please The Court: Weblog of legal news and observations, including a quote of the day and daily updates
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Quote of the Day - The lion and the calf will lay down together, but the calf won't get much sleep.
New Law: Driving While SnoringNew Jersey criminalized driving while tired last month. The legislation is dubbed Maggie's law for the 20-year old who was killed by a van driver who admitted to being up for thirty straight hours.It's the first law of it's kind in the nation. Two other states, Washington and New York, have similar bills pending. There's an attempt to create a federal version of Maggie's law, too. No, they don't plan on pulling you over if your head is leaning too far forward and then snaps upright. Maggie's law says that the DA has to prove that you've been up for more than 24 hours. The law, introduced by State Senator George Geist, had 11 co-sponsors. This bill, appears to be the final version. The National Sleep Foundation supported the bill, and is glad to see action being taken. "We are so accustomed to being fatigued and tired and sleepy that it's part of our daily life and we think nothing of getting behind the wheel and driving despite the horrible ramifications of that act," said Marcia Stein of the National Sleep Foundation, a nonprofit research organization. I can't imagine how the law can be effectively enforced. It's not like there's a version of the field sobriety test for sleeping or drowsiness. How tired do you have to be? If you keep quiet, how are they ever going to know unless someone else gives you up? It will be a dead giveaway, however, if you put your head down in the police car and start snoring. It gives a whole new meaning to being arrested. The "Gore Factors"Environmental decisions are in a word, messy. This one, however, adds a new twist that may clean things up faster.The Sixth Circuit decided a Kentucky case three days ago that is signifcant because some companies involved in Superfund cleanups have tried to dodge the "pay now" bullet in the past by sticking their heads in the sand. These companies are known as Recalcitrant PRPs (potentially responsible parties). They reason that by hiding, they can avoid contributing toward cleanup costs. There's a new sherrif in town. At least in the Sixth Circuit, that is. Now, it's going to hurt a little more if you hide in Kentucky. The decision endorses what appears to be a new factor in addition to the six existing "Gore factors" used to determine cleanup contribution. These factors are named for then-representative Albert Gore, Jr. (D-Tenn.), which were not included in the final version of the law. The (paraphrased) Gore factors include: (1) distinguishable discharge; (2) amount; (3) degree of toxicity; (4) involvement in generation, treatment, transportation, storage or disposal; (5) degree of care; and, (6) The degree of cooperation by the parties with Federal, State or local officials to prevent any harm to the public health or the environment. This last one is quoted in full because it's where the Sixth Circuit added a new factor to the analysis: "cooperation with the government." The law allows courts to consider "equitable factors," which the circuit judges opined was exactly what the trial judge did. Neville Chemical, who on its website claims "A Tradition of Leadership and Quality" must have missed that line when responding to the USEPA and the lead PRPs. The Court's opinion notes that at least four times Neville was offered the opportunity to cooperate and work out payment for its contribution of 472,000 gallons of wastewater sludge. And at least four times Neville declined the invitation. The trial judge Karen Caldwell apparently had enough, and although the parties thought Neville had contributed 4.78% of the contamination by volume, Judge Caldwell slapped Neville with 6%. Although the dollar amount of the cleanup involved is not in the opinion, Neville's share of the interest attributable on its portion of the cleanup costs (since 1986) was calculated at $298,000. Touch Me, But Don't Invade My PrivacyOften, lawyers come up with new theories to get coverage under insurance policies. Here's a new twist that didn't work in Florida. Lawyers there tried to trigger the "invasion of privacy" policy terms based on a claim of "offensive touching." No, it's not first and ten, it's unwelcome sexual advances.Mealy's Litigation Reports posted this article that highlight's Elaine Scarfo's case against her employer, Victor Ginsberg, for offensively touching her. Ginsberg tendered the suit to his insurance company, Allstate Insurance, which denied the claim. They then both sued Allstate. Allstate won, and the Florida Supreme Court determined that unwanted sexual advances do not trigger coverage under invasion of privacy policy language. Want to see practically the entire case? Florida State University College of Law has a nifty little website that indexes the opinion and all the briefs. It even includes an amicus brief, and video of the oral arguments. Cool. As an aside here, Allstate has changed its jingle from "You're in Good Hands" to "The Right Hands Make All the Difference." I'll have to refrain from commenting - but you've got your own imagination. Call me silly, but it seems that being felt up qualifies from a common sense approach as an invastion of privacy. Certainly, there are legal reasons it does not. Perhaps the 11th Circuit expert, Abstract Appeal, can give some more insight on the case. Two Towers, Two Planes, One Occurrence, Too BadThe World Trade Center owners in New York lost their battle with Hartford Insurance, Travelers Company, (formerly St. Paul) and a host of other insurance companies, but not Travelers. The WTC, owned by Silverstein Properties, LLC, wanted their insurance carriers to pay for the loss of the two buildings as two different "occurrences." That way, Silverstein could collect for the loss of both buildings. Obviously, the carriers only wanted the loss of the two WTC towers on September 11 to constitute one "occurrence."The U.S. Court of Appeals for the Second Circuit ruled that the loss of the towers constituted one occurrence. In a heavily factual opinion, the Court cited the policy form developed by Silverstein's insurance brokers, Willis of New York. The Willis "form" defined "occurrence" as: "... losses or damages that are attributable directly or indirectly to one cause or to one series of similar causes." Apparently, Silverstein was concerned with the insurance companies attempting to apply multiple deductibles to one "occurrence." Silverstein instructed Willis to customize (or manuscript) this language into the policies with the insurers. Silverstein, along with the rest of us, never thought both towers would be lost in one accident. Silverstein wanted high deductibles to keep premiums low, but didn't want the carriers to avoid paying claims by applying multiple "occurrences" to each loss. It backfired. In a big way. To the tune of only $3.5 billion instead of $7 billion. Yes, that's with only one "B" instead of two. In their decision, the Second Circuit agreed with Judge John S. Martin of the U.S. District Court for the Southern District of New York. He ruled that the "occurrence" definition agreed to by most of the various insurers meant that the damage occurred from one cause - a coordinated plan of attack on the two WTC towers. The Second Circuit affirmed his ruling. Traveler's portion of the case, however, remains unresolved, and is set to be heard by a jury. The Second Circuit thought the definition in the Travelers policy was too ambiguous to grant Summary Judgment as a matter of law for Judge Martin to decide. The case is actually much more complicated that I've presented here, and for lawyers, insurance brokers or others interested in the facts behind what happened, the case gives all the details, even down to quoting faxes and deposition testimony. Otherwise, the opinion is good for bedtime reading. The case is also a Civil Procedure professor's dream come true. The Court's discussion of jurisdiction goes on for almost eight pages - a lot to slog through if you're not a lawyer. If Silverstein hadn't tried to limit its own payout for multiple deductibles by altering the typical insurance definition of "occurrence," the Court would have had no problem awarding $7 billion dollars of coverage. You know: two planes, two towers, two different times, two sets of highjackers. Too bad for almost everyone ... but hope springs eternal for Silverstein and Travelers. No Lift for this Lift KitIf you’re going to sue, sue. Don’t just sit there.Anthony Choy installed a lift kit on his car, and then promptly lost control of the car and severely injured himself in an accident. How he got to sue anyone else is a mystery, but he did. He bought the lift kit from Shamrock Tire, and Shamrock was insured by Redland Insurance Company, part of the Clarendon Insurance Group (rating recently downgraded). Not surprisingly, Choy sued Shamrock. Not surprisingly, Shamrock filed bankruptcy. Here’s where it gets dicey. Choy tendered a policy limits demand to Redland for $500,000. Redland rejected the demand. Deals were made in Shamrock’s bankruptcy, and ultimately, Choy ended up with a bankruptcy claim for about $26K. The trustee approved the claim, the bankruptcy court approved the claim, but when the trustee sued Redland Insurance to collect the claim, the case was dismissed. The appellate court upheld the dismissal. Boom. Case over. The trustee’s case was dismissed ultimately because no one ever bothered to prosecute to judgment the underlying case for liability. It’s very simple in insurance lingo. No judgment, no payment. No one ever proved that Shamrock was liable for Choy’s injuries. (See also the second paragraph, above). Now, the attorneys, trustee and practically everyone else is embroiled in litigation to sort all of this out. That is, everyone but Redland. They’re just continuing to collect premiums and not pay out claims. We Can Pay Any Punitive Damages You Can AwardHats off to my former partner, Dan Callahan of Callahan & Blaine, who just pulled down a $934 million dollar victory. The news hasn't made it to their website yet, but it is in the print version of today's Los Angeles Daily Journal (right most column, and third story down on this internet page).Dan represented a medical equipment manufacturer, Beckman Coulter, and Gary Waldron of Waldron & Olsen and Scott Farrell of Call, Jensen & Farrell (I couldn't find either of their sites) represented Dovatron, whose parent is Flextronics. Supposedly trading was halted after the verdict, by it appears that the stock is still being traded, although it's fallen 4.73% at the time of this post. Not surprisingly, Waldron nor Farrell returned calls to the Daily Journal. Dan, of course, played to the paper. According to the article, "The jury was instructed - at the behest of Flextronic's counsel, according to Callahan - that the company was capable of paying any punitive award it may deliver. 'They stipulated they could pay any punitive damage allowed by law,' he said. 'I believe that tactic backfired on them. Their rationale was they did not want to expose their financial records in any more depth to the jury, but I believe it gave the jury a sense of arrogance and lack of remorse.'" In order to get to that little tidbit, you have to wade through the entire article. I don't think I would have put that revelation at the end of the article. That revelation is $850 million of the verdict. Arrogance costs a lot these days. Spam- Soon to be Illegal in CaliforniaJust a scant 30 minutes ago, Governor in Waiting Gray Davis signed SB 186, banning spam in California. The bill makes it illegal for spammers to send unsolicited email. The estimates in the bill are that 40% of all email sent is spam, and by the end of this year alone, it will reach 50%, costing us over $1.2 billion dollars.Fines are stiff: $1,000 for each violation and up to $1,000,000 for a email blitz campaign. The bill also provides for an award of attorneys fees to the prevailing plaintiff. The Los Angeles Times article quotes the Bill's author, State Senator Kevin Murray, who says it will be easy to collect these fines. The bill applies to "'Commercial e-mail advertisement[s']' [, which] means any electronic mail message initiated for the purpose of advertising or promoting the lease, sale, rental, gift offer, or other disposition of any property, goods, services, or extension of credit." The bill goes into effect January 1, 2004, and does not apply retroactively. The bill also requires email senders to provide an opt-out method - either in the email itself or an 800 number. Most other states have Spam laws, but California's is comparatively harsh. It will likely set a new standard for other states and the federal government. Plus, it will be a crime to send unsolicited email in California. So not only can regular citizens sue spammers, the AG and DA can file charges. Ouch! The Death of an Indian ChiefThe Indian Chief may once again ride off into the sunset. Yesterday, Indian Motorcyles halted production and laid off its entire workforce of 380 in Gilroy, California.Initially started in 1913, the company folded in 1953, but rumbled slowly back to life in 1999, according to an Associated Press article. The article points out that just last year, Indian introduced its own motor, the Power Plus, which creates an exhaust sound different than the infamous Harley-Davidson sound. (Check out the "Sounds of Harley-Davidson" box. After you scroll down, look on the right.) For a short sample of the Indian sound, click on the "Feel the Power" link on the site's home page. Now, the Indian company has 200 dealers across the country and had hoped to produce 4,500 bikes this year. Before WWI, Indian had produced as many as 20,000 bikes. Just recently, funds ran low, and the company's main investor backed out, leaving Indian high and dry. Dozens of investors have called offering help, but the company is weighing bankruptcy options. This sad event may have been coming for some time. The job application section of the company's website notes that no jobs are available at this time If you were ever thinking about owning an new Indian, now may be your last chance.
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