Challenging A Non-Compete Covenant
LABOR LAW: Who Pays For Sexual Harassment?
Severance Deal? No Need to Rush
Woman to Woman Sexual Harassment
CLASS ACTION: Defending Fleet On Rate Inflation Charge
TECH TRANSFER: Innovative Model For Biotech Deal
CONTRACT LAW: Harbor Dredging Dispute
MERGERS & ACQUISITIONS: Valuation Defended
TAX LAW: Defending Hospital’s Status
ENVIRONMENTAL LAW: $38 Million Cleanup
PERSONAL INJURY: Fatigued Trucker
FIRST AMENDMENT Right to Hear 911 Tapes
FAMILY LAW: Licenses Lost Over Child Support
Corrections or additions?
This article was prepared for the May 28, 2003 edition of U.S. 1 Newspaper. All rights reserved.
Business Law
U.S. 1 asked area firms to comment on recent legal cases and court
decisions that could have an impact on business in Central New Jersey.
This section was edited by Kathleen McGinn Spring and Barbara Fox
Top Of Page
Challenging A Non-Compete Covenant
Karol Maw is a graphic designer. Or she was until she
was fired by the Lambertville-based pharmaceutical marketing firm,
Advanced Clinical Communications, for refusing to sign an employment
agreement containing a covenant not to compete. The clause would have
prohibited her from working for a competitor or customer for two years
after leaving the company. Fearing that such a prohibition could
prevent
her from earning a living, she balked at signing.
After she was terminated, Maw sued her former employer, which has
since changed its name to Advanced (www.advancedmdc.com). Now Maw,
who probably would not have become famous as a result of the
illustrations
she prepared for pharmaceutical marketing materials, stands a good
chance of having her name attached to a ground-breaking case.
"This is a big, big issue," says Michael Osborne, an
attorney with Stark & Stark who specializes in employment law. This
is so, he says, because in her law suit, Maw alleged that her rights
under the Conscientious Employee Protection Act (CEPA) — also
known as the "whistle-blower act" — had been violated
by the demand that she sign the non-compete agreement. It is that
claim that sets her case apart, according to Osborne, who predicts
that the case could go all the way to the Supreme Court — and
create substantial headaches for employers.
Osborne speaks on "Restrictive Covenants," including
agreements
like the one Maw refused to sign, on Wednesday, June 4, at 9 a.m.
at a free seminar in the community room of Stark & Stark’s offices
at 993 Lenox Drive. Call 609-219-7413 to reserve a spot.
The Mercer County Superior Court dismissed Maw’s case, finding that
the non-compete agreement does not per se violate public policy. But,
in a decision handed down just last month, the Appellate Division
reversed this decision, and ruled that Maw can proceed with her claim
against her former employer.
Phone calls to the attorney representing Maw and to the attorney
representing
Advanced Clinical Communications were not returned, but here are the
facts of the case as laid out in the complaint Maw filed and in the
Appellate Court decision.
A New Hope resident, and the mother of a young child, Maw was employed
by Advanced Clinical Communications for three-and-a-half years,
designing
written materials and presentations used as educational and marketing
tools for the company’s clients in the pharmaceutical and healthcare
professions. She was promoted to the title of senior graphic designer
in January, 2000. In that position, her major responsibilities
involved
providing creative design concepts for written and graphic materials;
preparing the design and layout of technical charts, graphs, and
reports;
working with vendors on design issues; and other work typical of a
graphic designer.
The educational requirements for the position were a bachelor’s
degree,
with an emphasis in graphic design preferred. In addition, the
employer
required a minimum of four to six year of design experience and a
knowledge of a number of graphic-related software products. Maw had
no training in any medical or pharmaceutical science and understood
very little about the substantive/medical/pharmaceutical content of
the projects on which she was working. Her job did not require such
understanding or knowledge; instead it required her to be able to
present printed or graphic material in an attractive and
understandable
format by using the principles of graphic design.
In January, 2001, Advanced Clinical Communications and
its president, Michael Forte, against whom Maw also is pursuing a
cause of action, made a decision to require all employees at the level
of coordinator and above to sign an employment agreement, which
contained
the non-compete agreement. Maw’s complaint alleges that defendants
made no distinction between the employees based on their job duties
and did not undertake a process to specifically identify for each
employee the "legitimate business interest" it was seeking
to protect. It further alleges that, while Maw may have had access
to certain confidential material in the course of going about her
work, there were numerous administrative and clerical staff who had
the same access to this same material, and they were not required
to sign the employee agreement.
In addition, by the time graphic design projects relating to the
launch
of a new product were begun, the drugs involved had already passed
the FDA’s pre-approval process, and substantial information about
them was already in the public domain.
Nevertheless, Maw was willing to sign the section of the employment
agreement that prohibited any employee from disclosing, during the
time of employment or at any time thereafter, any confidential or
proprietary information.
It was the non-compete clause that gave her pause. She did not
understand
why, as a graphic designer, she would have to sign it, and she worried
that it would restrict her ability to find a job elsewhere in her
field.
The agreement suggested that employees obtain independent legal
counsel
before signing, and Maw did so, calling upon her father, an attorney.
Maw proposed changes in the agreement, including changes to the
duration
of the non-compete clause. When she presented the proposed changes,
she was told that the company would not discuss the agreement at all
with her. Her complaint alleges that an HR representative told her
that "it’s the president’s company and he is not going to make
any exceptions."
Believing that there was no legitimate business reason compelling
her employer to make her sign the agreement, she declined to do so
and soon after was terminated. The reason given was "noncompliance
with company policy."
In her complaint, Maw states that she is due compensatory and punitive
damages for her injuries, including humiliation and emotional
distress,
suffered as a result of her employer’s violations of CEPA. The
provisions
of CEPA, the complaint reminds the court, prohibit an employer from
taking retaliatory action against an employee where the employee is
objecting to or refusing to participate in an activity, policy, or
practice that the employee reasonably believes is in violation of
a law and/or is incompatible with a clear mandate of public policy.
That the Appellate Court agreed that she could pursue a cause of
action
under CEPA is what makes Maw’s case a ground breaker, according to
Stark & Stark attorney Osborne. "It’s like the law against
discrimination,"
he explains. Plaintiffs who prevail on a CEPA claim are entitled to
punitive damages, including attorney’s fees, in addition to
compensatory
damages, which typically include lost wages.
"That means," Osborne gives as an example, "a plaintiff
could win a $5,000 judgment and be awarded $100,000 in attorney’s
fees." This is not true in a contract case.
"This decision is sending a major chill through employers,"
says Osborne. This is especially so, he says, because employers have
vastly accelerated the pace at which they are passing out employment
agreements, and have broadened the categories of employees compelled
to sign them. "More and more rank and file, non-management
employees
with no access to secrets are signing," he says. In his opinion,
"some employers are over-reaching."
But, Osborne, continues, the employer’s caution is often based not
on paranoia, but rather on vastly changed ways of doing business.
"It used to be that you needed to pull up a van in the middle
of the night to make off with client lists," he says. The same
getaway strategy was necessary for spiriting away mailing lists,
top-secret
research, or plans for business expansion. Now, he points out, it
takes only seconds, and a blank disk, to accomplish the same heist.
"Information is much more portable than it was 15 years ago,"
says Osborne, and courts are having a much harder time in deciding
restrictive covenant cases. "They believe in competition,"
he says, "but not in unfair competition." Balancing the two
is the stuff of litigation.
There are three types of restrictive covenants. The first has to do
with trade secrets, the second with non-solicitation of clients or
employees, and the third, the issue in the Maw case, with non-compete
agreements. All three types of restrictive covenants must meet a
three-pronged
test if they are to be enforceable. They must protect a legitimate
business interest of the employer; they cannot impose undue hardship
on an employee; and they cannot injure the public.
Courts have the easiest time in deciding cases involving trade
secrets,
says Osborne. It is easy to see that sneaking out of Coke with the
formula for Coke Classic and setting up competing a soft drink
business
is a no-no.
Non-solicitation is far trickier. "It’s a chicken and egg sort
of thing," says Osborne. Did the salesperson attract the clients
through the power of his personality? And is he therefore entitled
to take them with him when he starts his own business or goes to work
for another company? Or did he reel them in using the prestige of
his company’s image? And should their relationship remain with that
company? "We see this all the time with securities firms,"
Osborne says. "A broker goes from one house to another and
solicits
his book of business."
While non-solicitation cases can go either way, non-compete cases
are where the employer has the most trouble prevailing, especially
in New Jersey. "New Jersey leans toward employees," says
Osborne.
"This is the one the courts are least likely to enforce. The
general
feeling is that people should have the ability to make a living."
Non-compete agreements restricting employees for a short period of
time have a better chance of being enforced. During the Internet
bubble,
Osborne recalls, New York courts decided that six months was the
maximum
amount of time an employee could be prohibited from competing. The
rationale? Within half-a-year the pace of technology innovation would
make any proprietary information obsolete — and useless.
Osborne, a graduate of Duquesne (Class of 1988) and of the Quinnipiac
School of Law, has been working on management-side employment law
for three years. He says his firm gets "hundreds" of calls
a year from employers looking for advice on restrictive covenants.
His general advice, particularly in light of potential implications
of the Maw case, is to proceed carefully in compelling employees to
sign restrictive covenants. If the agreements are deemed necessary,
it is probably a good idea to lock them up before employment begins,
or to have them signed in conjunction with a promotion.
A problem for the employer in the Maw case, in Osborne’s opinion,
is that the employment agreement was "sprung on her" for no
apparent reason after she had been working for the company for several
years. If she had been presented with the same agreement before she
was hired, it would be a different story. "Then it could be said
that she went into it with her eyes open," he says. But being
asked, out of the blue, to stay out of large segments of the workplace
for two years should she leave the job could be construed as being
unreasonable.
Should Maw prevail, the agreement, which appears to confer no major
protection or advantage on her former employer, could prove to be
very expensive. Perhaps just the prospect of such a victory will make
any number of New Jersey employees think twice before compelling their
workers to sign restrictive covenants. Says Osborne, "This is
a very interesting case."
— Kathleen McGinn Spring
Top Of Page
SPORTS LAW: NHL Contracts
For James F. Dial, a hockey fan and a partner
at Reed Smith at Forrestal Village, representing the Minnesota Wild
of the National Hockey League in salary arbitrations with restricted
free agents is a dream assignment. In a legal field historically
dominated
by Canadian law firms, Dial’s representation is something of an
anomaly,
but he had positive results for the three-year-old expansion club
after the past two seasons.
Every year scores of National Hockey League restricted free agents
file to participate in binding arbitration to determine their salaries
for the upcoming season. About a dozen or so actually get to the
hearing
stage of the process, at which management and the player are
represented
by legal counsel. This is where Dial comes in.
In 2001 he represented the Wild in one of the team’s three cases that
went the distance. On the heels of that favorable result, he was again
selected to represent the Wild in arbitration in 2002, this time
involving
the team’s left wing, Finnish-born Antti Laaksonen, the only Wild
player to appear in every game of the franchise’s then two-year
history.
"The process is that both sides submit evidence about a player’s
value to the hearing arbitrator," says Dial. "It’s a little
more exciting than many other kinds of arbitration, because this
evidence
hinges on an individual player’s hockey statistics — how many
goals, assists and saves made, how many minutes played, how many
minutes
in the penalty box. The primary focus is to try to find similar
players
and develop an argument for the salary worth of the player in question
based on salaries of these comparables. Management’s case hinges on
establishing the salary band for players with similar levels of
accomplishment.
Of course, the player and his attorney generally have a different
perspective."
Held in Toronto each year, a hearing requires both written submissions
and oral argument, after which the arbitrator determines the player’s
salary. Dial points out that the process must be carefully conducted,
with an eye not only on past player performance, but on future
considerations
as well.
"It’s important not to alienate a player in the salary arbitration
process," he explains. "These are individuals you want to
keep as part of your team and encourage their contribution to the
team’s success for seasons ahead."
The Wild’s recent loss to the Anaheim Ducks brought their Stanley
Cup hopes to an end in mid-May. With five players eligible to file
for arbitration, Dial is ready to represent the team in negotiations
with any who pursue the hearing route this summer.
Top Of Page
LABOR LAW: Who Pays For Sexual Harassment?
Employees working for small businesses that may not
have the money to compensate their employees for injury can still
hope to recover for damages incurred in a discrimination or harassment
case, according to a sexual harassment case that went to the Supreme
Court of New Jersey (Schmidt vs Smith, 1998). "This case has
changed
the face of discrimination claims in New Jersey," says
Elizabeth
Zuckerman of Zuckerman & Fisher who represented the employee.
John
Bubblewicz of Hamilton represented the employer.
As a result of the case, employers can now have insurance companies
cover claims in which employees allege physical consequences stemming
from the emotional distress of harassment or discrimination.
Top Of Page
Severance Deal? No Need to Rush
Medical Inter Insurance Exchange (MIIX, the medical
liability insurance company on Princess Road) lost a case in 1998
involving an employee who returned from disability leave to learn
that her job had been terminated. Upon her return, the employee was
encouraged, that day, to sign a release in return for a severance
package. Elizabeth Zuckerman represented the plaintiff in the
1998 case, Riddell vs. MIIX, and Vanessa Kelly of Jackson Lewis
represented the defendant.
The court held that the employee did not have adequate opportunity
for reflection and did not clearly identify the claims being waived.
The court also said that the employee could keep the severance she
received because a requirement to give it back could deter meritorious
claims.
Top Of Page
Female Harasser
<B>Linda Wong and Daniel Fleming of Alexander
Road-based Wong Fleming PC (www.wongfleming.com) have a sexual
harassment
case before the New Jersey Supreme Court that made the pages of People
magazine and stands to earn them almost a million dollars. Though
the harassment was mostly verbal, and the harassed person kept his
job, the jury awarded more than $750,000 in compensatory damages and
$3 million in punitive damages.
What made this case different was that the plaintiff was male, and
the harasser female. It was the first female-on-male sex harassment
case in New Jersey and the largest verdict of its kind in the country.
The state has finally admitted that Ronda Turner, a supervisor at
the Mid-state Correctional Facility in Wrightstown, harassed jail
guard Robert Lockley Jr. over a nine-year period. But the state did
not admit it soon enough, not before Wong and Fleming had counted
up $822,000 in attorney fees. "Before we filed, we offered to
settle the case for $10,000," says Wong, who has an eight-attorney
office at 821 Alexander Road (www.wongfleming.com). The state had
another chance. A week before jury selection she and Fleming offered
to settle for $300,000.
Wong rejects the notion that Lockley’s award is too high, saying that
the jury based its verdict on daily emotional distress. "Who is
in a better position than the jury to decide this? There was a
breakdown
in the relationship with his family. He was the subject of constant
ridicule about his masculinity. It was vicious and repeated, day in
and day out," she says.
The case was appealed, both on the grounds of attorney fees and jury
awards. Wong and Fleming said their personal work accounted for 1,349
of the 2,220 hours spent by their firm, and that their fee is $325
an hour. The state retaliated that it was more usual for associates
to do most of the work, but Wong and Fleming emphasized the
difficulties
that they faced and the risk that if their client lost, he would not
be able to pay any fees.
The appellate court upheld both the attorney fees and the $750,000
plus interest in compensatory damages, but not the $3 million in
punitive
damages. Wong took the $3 million to the state Supreme Court, which
heard the case last January.
Top Of Page
Joking Vs. Abuse
How to draw the line between joking and abuse in the
workplace? In 1999 a federal jury in Trenton awarded $227,000 to a
state worker with dyslexia who said the workplace atmosphere violated
the Americans With Disabilities Act rules on disability-related job
discrimination. It was one of the first times a plaintiff has won
a case alleging a hostile environment under the ADA.
The plaintiff’s attorney, Linda Wong of Wong and Fleming at 821
Alexander
Road (www.wongfleming.com), compares disability harassment to racial
harassment: "When someone’s weakness becomes the butt of daily
jokes, that’s not funny," says Wong. Agreeing that employers are
indeed liable for racial harmony and gender equity in the workplace,
defense attorneys decry the additional vulnerability that this
decision
adds and raise the specter of censorship in private conversations.
Plaintiff Philip J. Lanni, 34, was a radio dispatcher for the
Department
of Environmental Protection at the Assunpink Wildlife Area in
Robbinsville.
He says his halting speech and memory and comprehension problems due
to neurological disorders made him the target of repeated harassment
such as putting his picture on a turkey decoy, mimicking his speech,
publicly correcting his spelling errors, and joking about shooting
him.
Defense lawyers tried to show a teasing atmosphere where Lanni himself
called his overweight supervisor "Fat Man" and "Jabba
the Hun," and pointed out that co-workers were supportive in other
ways, such as collecting $500 when Lanni’s house burned down.
Presiding Judge Anne E. Thompson refused to approve the law firm’s
request for more than $1 million in fees and nearly $50,000 in costs,
saying in part that both name partners need not have attended the
trial, and so one of them should have billed themselves at the
associate’s
level. Most of the money questions — including some quibbles over
copying costs — were won by Wong & Fleming on appeal.
Top Of Page
Woman to Woman Sexual Harassment
This case of sexual harassment involved only one
incident,
and the court ruled that a single incident (touching on the breast
and threatening words by a supervisor to a subordinate) was enough
to establish that a reasonable woman could believe her work
environment
had become hostile.
The case of Flizack vs. Good News Home for Women was also unusual
in that the harassment was woman to woman. The appellate court ruled
that a woman could maintain a sexual harassment claim against another
woman regardless of whether either person was an avowed homosexual.
"A claim for sexual harassment does not require that the defendant
be motivated by the desire for sexual gratification," said the
court. Elizabeth Zuckerman of Zuckerman & Fisher on Mapleton
Road represented the plaintiff, and Charles Schalk of Somerset
represented the defendant.
Top Of Page
AIDS Discrimination?
A Mercer County jury awarded $265,800, amounting to
$540,000 including attorney fees and costs, to a former employee of
Nelson Communications on Lenox Drive who alleged he was selected for
termination as part of a reduction in force because the employer
suspected,
or discovered, that he had AIDS.
Jacqueline Tillman of Zuckerman & Fisher represented the
plaintiff
and Frank Dee of Carpenter Bennett in Newark represented the
employers. The company denied any wrongdoing and appealed the verdict,
and a settlement was reached before the case went to appeals court.
Top Of Page
CLASS ACTION: Defending Fleet On Rate Inflation Charge
When FleetBoston Financial was named a defendant in
a putative national class action suit, it was represented by Reed
Smith partners Mark S. Melodia at Princeton’s Forrestal Village,
and Anthony Laura in Newark (www.reedsmith.com).
FleetBank is among a dozen of the nation’s largest financial
institutions
being sued by three plaintiffs purporting to represent hundreds of
thousands, if not millions, of banking customers. Specifically, the
plaintiffs claim that FleetBank and its codefendants have engaged
in a conspiracy to inflate the prime rate paid by the borrowing public
on all prime-based credit products (for example, home equity loans,
credit cards and lines of credit).
"The suit asserted RICO, the Sherman Act, and New Jersey Consumer
Fraud claims, which our Reed Smith team and the attorneys for the
other financial institutions were able to successfully counter,"
says Laura. "All of the banks moved jointly to dismiss the case
— a motion the court granted."
Melodia participated in the nearly four-hour oral argument before
the court, and Laura played a key role in preparing defense materials.
But, says Laura, "all of the attorneys and firms involved
contributed
to the victory."
Melodia and Laura continue to represent Fleet Bank in the appeal of
the Court’s decision, to be argued on Monday, June 2, in the Court
of Appeals for the Third Circuit in Newark.
Top Of Page
Mortgage Cases Dismissed
Reed Smith’s Princeton-based team, headed by Mark
S. Melodia, scored a series of national victories for three
financial
clients — GMAC-RFC, Sovereign Bank, and M & T Bank — in 12
cases pending in two states.
A well-known plaintiffs’ class action firm had attempted to hold the
three Reed Smith clients and some 80-plus other defendants responsible
for alleged unlawful conduct by the originators of the named
plaintiffs’
second mortgage loans — regardless of the fact that most of the
defendants never purchased or received the plaintiffs’ loans from
the originators. The plaintiffs wanted such remedies as refunds of
mortgage loan fees, mortgage interest paid, and penalties.
Because of the large number of mortgage entities named as
co-defendants
in the cases, there were multiple law firms from across the nation
involved. Like Reed Smith, many of them represented more than one
defendant. The Reed Smith team, which also included Lauren G.
Delehey
and Melissa P. Marschner, was selected as lead counsel by this
large joint defense group. Melodia made the oral argument for the
defense group on the motions to dismiss before the courts in Indiana
and Colorado.
Dismissals were obtained for all 12 matters, with four judges
involved.
Top Of Page
TECH TRANSFER: Innovative Model For Biotech Deal
Last October Reed Smith Princeton partners Diane
Frenier and Nan Mantell put together a deal between a
genomics-based
drug discovery company and their major pharmaceutical client,
GlaxoSmithKline.
Together with associates Rosemary Farr, Michelle LoMonte and
Greg Wiessner, they arranged a broad alliance between
GlaxoSmithKline
(GSK) and San Francisco-based Exelixis to discover, develop, and
commercialize
novel therapeutics in the areas of vascular biology, inflammatory
disease, and oncology.
Using an innovative model for sharing risks and potential rewards
in an R&D collaboration, the alliance combines Exelixis’ gene-to-drug
discovery platform and GSK’s strengths in development and
commercialization.
Exelixis is to deliver to GSK an undisclosed number of small-molecule
compounds that have met agreed-upon criteria in early Phase II
clinical
testing. GSK will have the right to further develop these compounds
and exclusive, worldwide commercialization and manufacturing rights.
"As a part of the deal, Exelixis retains co-promotion rights in
North America," says Frenier. "GSK will make an upfront
payment
of $30 million to Exelixis. GSK will also initially acquire 2 million
newly issued shares of Exelixis common stock at $7 per share, which
represents a premium of approximately 100 percent to the current stock
price. Exelixis also has the option to sell GSK additional shares
at a specified time in the future."
Other parts of the agreement call for GSK to pay Exelixis a minimum
of $90 million in development funding over a six year period, $220
million to $350 million in clinical and regulatory milestone payments,
and it will loan Exelixis up to $85 million. Two years from now, if
the two companies expand the collaboration, Exelixis’ milestone
payments
could double in size, and the development funding and the loan
facility
would also be significantly expanded.
Top Of Page
CONTRACT LAW: Harbor Dredging Dispute
In a case that involved a high-dollar contract to
modernize
the ports in Newark and Elizabeth, Reed Smith’s Mark Manewitz
(of the Forrestal Village office) and Anthony Laura and Greg
Dadika (of the Newark office) successfully preserved their client’s
dredging agreement with the Port Authority of New York and New Jersey.
Their client, Bean Stuyvesant LLC, had submitted the second-lowest
bid for providing dredging services for the federal contract from
the Army Corps of Engineers for part of the New York harbor dredging
program.
Jay Cashman Inc., the New England-based plaintiff in the case, had
initially submitted the low bid. Cashman, however, made a mistake
of such magnitude in the bidding process that the firm subsequently
withdrew its offer. As the next lowest bidder, Bean Stuyvesant (a
joint venture between firms in the United States and the Netherlands)
was then awarded the contract.
Subsequently the Port Authority awarded Bean Stuyvesant with a
contract
for additional work in the same part of the harbor for deeper
dredging,
which Cashman sought to enjoin in Federal District Court. Cashman
claimed that Bean Stuyvesant, along with co-defendants, the Corps
of Engineers and the Port Authority, had bypassed federal public
bidding
requirements in awarding the work to Bean Stuyvesant.
The Reed Smith attorneys crafted critical certifications and briefs
to demonstrate that the U.S. District Court of New Jersey lacked
subject
matter jurisdiction to hear the plaintiff’s injunction, and they
guided
the Army Corps and Port Authority in succeeding on similar arguments.
"The Court agreed with the Reed Smith argument that Cashman had
filed the matter in the wrong court," explains Manewitz. "The
judge subsequently transferred jurisdiction in the matter to the
Federal
Court of Claims, where it should originally have been filed. We also
successfully convinced Cashman that their argument would not prevail
in the Court of Claims."
Cashman voluntarily dismissed the case against all three defendants
when it did not succeed in the District Court action.
Top Of Page
MERGERS & ACQUISITIONS: Valuation Defended
Putting a value on something, whether it’s a house for
sale or an asphalt contract, is as much of an art as a business. You
can crunch the numbers all you want, but there will still be some
intangibles that have to be guessed, and the final sum almost
certainly
will displease one of the parties involved, either the seller or the
buyer.
And when the object in question is worthy many millions of dollars,
the tension is compounded.
Valuation experts at Management Planning Inc. (MPI) on Poor Farm Road
have been doing this for more than 60 years (www.mpival.com). MPI
Securities Inc. is a broker-dealer that provides business and
securities
valuation expertise to closely held and publicly held businesses
including
litigation support and expert testimony.
But recently Management Planning ran afoul of a buyer that very much
disagreed with the firm’s conclusions, and was taken to court. Don
Veix of Mason Griffin Pearson, located in the same building on
Poor Farm Road, successfully defended MPI against an attorney team
that included the former U.S. Solicitor General under President
Clinton
and the firm that Clinton used during the Monica Lewinski scandal.
A branch of the family that had founded the Salt Lake Tribune had
lost financial control of the paper and was trying to buy it back,
but its owners meanwhile had sold it to someone else. Each side hired
an appraiser, and the third appraiser, MPI, was to come up with the
final sum. That sum was rejected by the family, who filed the lawsuit
in January, saying MPI’s value was too much by more than $100 million.
Though the New Jersey Superior Court rejected the suit, the family’s
attempt to buy the paper continues.
Top Of Page
TAX LAW: Defending Hospital’s Status
If you think the Medical Center of Princeton has had
problems with neighbors, zoning, and what not, consider the case of
a hospital that incurred so much ill will that the host municipality
tried to make it pay taxes.
The Southern Jersey Family Medical Center had its property tax
exemption
revoked by the municipality in which it was located, Pleasantville,
on the grounds that much of the hospital’s revenue was from government
grants and reimbursements for providing services to indigent and
low-income
patients. The New Jersey Tax Court upheld the tax assessor’s denial,
but Archer & Greiner, representing the hospital, successfully appealed
the decision. Then Pleasantville took it to the state supreme court.
On May 13 the New Jersey Supreme Court upheld a decision that even
though a charitable organization receives substantial government
funding,
it can still qualify for a tax exemption. Arthur H. Jones of
Archer & Greiner (www.archerlaw.com) successfully argued the case.
Top Of Page
ENVIRONMENTAL LAW: $38 Million Cleanup
Representing three companies, Chris Gibson of
Archer & Greiner successfully defended a $38 million suit filed by
Rohm & Haas to recover the cost of cleanup for the Lipari Landfill
Superfund Site in Gloucester County. Based in Haddonfield, Archer
& Greiner has offices at 700 Alexander Park (www.archerlaw.com).
Gibson’s
clients were Crown, Cork & Seal Company, Continental Can Company,
and NL Industries Inc.
The landfill was first on the priorities list of SuperFund Sites in
1985 when the original $38 million suit was filed by the United
States,
via the New Jersey Department of Environmental Protection, against
Rohm & Haas, and three years later Rohm & Haas filed suit against
the third-party defendants. After a 29-day trial, U.S. District Judge
Joseph H. Rodriguez ruled in favor of the defendants.
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PERSONAL INJURY: Fatigued Trucker
A trucker for a floral company was on his third day
of interstate deliveries and was driving his 24-foot, 9,000 pound
truck south on the New Jersey Turnpike. He made an illegal stop in
Salem County to urinate and then re-entered the roadway and never
saw the 1988 Nissan minivan traveling at 65 miles per hour in the
right lane. It was 5 a.m. on New Year’s Eve day, December 31, 1999,
and a family of six were driving from a relative’s home in Connecticut
to their home in North Carolina.
The father was thrown more than 300 feet and died hours after the
accident. The mother suffered brain injury and fractures to both legs,
ribs, and jaw. Four children had no serious physical injury but there
was severe emotional impact relating to the loss of their father and
their mother’s brain damage.
Frank D. Allen and Andrew J. Rosetti of Archer & Greiner
(www.archerlaw.com) represented the family, and the case settled on
January 4, 2002. The trucking company and its insurers had to pay
$7.125 million — $4.625 million for the mother and children and
$2.5 million for the estate of the father.
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FIRST AMENDMENT Right to Hear 911 Tapes
A Newspaper’s right to see public records includes the
rights to listen to a police department’s 911 tapes, ruled the
Superior
Court of New Jersey in Ocean County. The Asbury Park Press had sued
to get access to the tapes covering a confrontation between Lakewood
Township police officers, and an individual, Thomas Jacobs.
On July 6, 2001, Jacobs was being pursued by undercover police
officers
during what was termed a "low speed chase," and he called
911 on his cellular phone. Then he was stopped, forced out of his
vehicle, and according to his account, was kicked and punched. The
police officers were indicted after an investigation, but the Press
was denied access to the reports.
The Lakewood police officers claimed that the tapes were exempt from
the "Right to Know Law," particularly when they were part
of an ongoing investigation, and that it would prejudice the rights
of the parties in the investigation.
Representing Gannett, the New Jersey newspaper chain to which the
Asbury Park Press belongs, was John C. Connell of Archer &
Greiner,
based in Haddonfield and with an office on Alexander Road
Connell cited a 50-state survey of decisions that had examined this
issue, and the court found in favor of access to the tapes on April
11, 2002.
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FAMILY LAW: Licenses Lost Over Child Support
If you are an architect, doctor, taxi driver, or
cosmetologist,
keep your child support paid up or you won’t have a job. It happened
to a boxer licensed by the state; his failure to make child support
payments cost him his license and perhaps his career.
Brian Paul, a family law attorney with Szaferman Lakind
Blumstein,
Blader, Lehmann & Goldshore at Quakerbridge Executive Center
won a case against "Tiger" Thomas, a light heavyweight boxer
who lost his license to fight until he had paid at least $4,000 in
child support to Margaret M. Greco, the mother of Thomas’ two-year-old
twin girls.
Paul, who represented Greco in the 1999 case, said that he could find
no previous case of a New Jersey boxer who lost his license for
failure
to pay child support. He based his case on a 1998 amendment to the
Child Support Improvement Act, which covers all state licenses and
certificates, including professional licenses for beauticians,
architects,
and veterinarians, as well as recreational and sporting licenses.
"Boxing is a privilege in New Jersey, not a right. It’s like
driving
a car. If you don’t meet your obligations to pay child support, that
privilege will be taken away," said Paul.
Greco, who was working at the time as a legal secretary for the state,
and also had a part-time job with a boxing management company, was
not the only mother of children by Thomas, but she was the only one
to pursue legal action. She was supposed to be getting $80 a week,
including back payments for $4,000 owed.
Thomas’ trainer protested that Greco was getting one-third of the
boxer’s purses, that Thomas was doing his best, and that canceling
fights would ruin his career. Described as a "rising star,"
Thomas had a 10-1 record with nine knockouts, and his fights had been
aired on cable television.
Paul brought the case up to date in a telephone interview. "A
couple of times he was able to box and a portion of the purse went
for the child," says Paul, "The purses were small, $10,000
and $15,000. After fees she probably got $1,500 or $2,000. I don’t
think he is boxing any more."
In contrast to driver suspension, which can be automatic and is easily
tracked, professional license suspensions require due process —
accurate identification and a hearing. "Many professional boards
had not been collecting social security numbers and their databases
are not of the caliber needed to confirm identities," says court
spokesperson Winnie Comfort. So only a small number of professionals
have been tracked down, and almost all were able to pay up to continue
working.
Corrections or additions?
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