Browne, et al. v. PAM Transport; Eat, Drink, and Be Wary: Hidden Costs in the Sleeper Berth After New FLSA Ruling

/in /by Browne, et al. v. PAM Transport; Eat, Drink, and Be Wary: Hidden Costs in the Sleeper Berth After New FLSA Ruling

A recent decision issued in Browne, et al. v. PAM Transport, a class action lawsuit brought under the Fair Labor Standards Act (“FLSA”), may signal further national litigation and additional labor costs for time commercial drivers spend off the road.  In the US District Court for the District of Arkansas, a group of truck drivers sued their employer, P.A.M. Transport (“PAM”), alleging they should have been paid for 16 hours out of every 24-hour period pursuant to the FLSA, even though DOT regulations require drivers to spend no more than 14 hours on the road.

The FLSA recognizes that certain employment positions require employees to have periods of down time where they are not necessarily actively performing any employment duties.  The FLSA mandates that employers pay those employees an amount at least equal to minimum wage for those periods of down time. Typically, this applies to receptionists, firefighters, waiters, or other employees who respond to variable workloads. In the context of the transportation industry, the FLSA payment mandate applies to drivers who must wait at certain pickup and delivery points to be loaded and unloaded. For employees who are required to be on duty for 24-hour periods, the FLSA requires employers to pay their employees for their down time, including time spent eating and sleeping, during the full 24-hour period. An employer and employee can enter into an agreement that permits a maximum of eight hours in a 24-hour period to be unpaid. However, an employer must compensate an employee who is required to be on duty for 24-hour periods for a minimum of 16 hours under the FLSA, regardless of whether the employee spends more than eight hours eating and sleeping.  In the absence of any agreement to exclude any portion of the 24-hour period from an employee’s compensation, an employer must compensate the employee for the full 24 hours.

It is against this backdrop of the FLSA that a group of truck drivers sued their employer, PAM, alleging that PAM was required under the FLSA to pay them for a minimum of 16 hours of every 24-hour period, even where some of those 16 hours were spent in the sleeper berth.  The US District Court for the District of Arkansas was tasked with determining whether a commercial truck driver who is in the sleeper berth and therefore “off duty” for purposes of the Federal Motor Carrier Safety Regulations (“FMCSR”), is still “on duty” for purposes of application of the FLSA and therefore entitled to payment of at least minimum wage for time spent in the sleeper berth.

In parsing out the applicable FMCSR and FLSA provisions, the court ultimately determined that commercial drivers not “on duty” under FMCSR hours of service regulations are, in fact, “on duty” for FLSA purposes and therefore entitled to compensation for time spent in the sleeper berth.  In reaching its decision, the court determined that the purpose of the FMCSR is to “make our roads safe,” while the FLSA regulations govern issues related to compensation. Therefore, the court determined that the FLSA provisions as to whether a driver is “on duty” should apply in order to determine appropriate compensation.

While this order is not binding on other courts, it is an indication of potential additional litigation and future risks related to employer liability.  The Browne case highlights the importance of motor carriers having an agreement in place with their employee drivers to exclude the eight hours permitted under the FLSA for time spent in the sleeper berth from a driver’s compensation, in order to reduce the amount of time and wages potentially at issue.

For more information regarding this article, please contact April Kerns at 410.230.2975 or akerns@fandpnet.com.

Trending Anti-Indemnification Statutes

/in /by Trending Anti-Indemnification Statutes

Traditionally, motor carriers and shippers used contracts to set forth their respective obligations, which included shifting the risk of liability from one party to the other.  Shippers have notoriously had more leverage in this situation, placing motor carriers in the precarious position of contractually assuming all the risk of liability, including liability for the shipper’s own negligence.  In the last ten years, states have taken notice of such inequitable contracts and by 2016, 42 states had passed some form of an anti-indemnification statute, restricting the anti-indemnification clauses in shipper/motor carrier contracts.

The purpose of these statutes is twofold: to protect individuals and entities from assuming all liability for accidents in shipping contracts and to protect motor carriers from bearing the liability of a shipper’s own negligence.  There are four categories of anti-indemnification statutes:

Category of Anti-Indemnification Statute States Enacted in
Statutes that prohibit motor carriers and shippers from contracting to indemnify the shipper against the shipper’s negligence-based and intentional-based liability. Alaska

New Mexico
Statutes that prohibit unspecified third parties, such as a shipper, broker, etc., from requiring the motor carrier to indemnify the third parties for any negligence-based or intentional-based liability. Hawaii

Oklahoma

South Dakota
Statutes that use boilerplate promisor and promisee language to prohibit indemnification for negligence-based or intentional-act based liability in any provision that affects a motor carrier agreement or contract. Arkansas

California

Colorado

Connecticut

Iowa

Kansas

Louisiana

 

 Massachusetts

Montana

New Jersey

New York

Oregon

Tennessee

Utah

Wyoming
Statutes that use boiler plate promisor and promisee language to prohibit any non-motor carrier from requiring motor carriers to indemnify the non-motor carrier for its negligence-based and intentional-based liability. Florida

Georgia

Idaho

Illinois

Indiana

Kentucky

Maine

Maryland

Michigan

 

 Minnesota

Missouri

Nebraska

Nevada

North Carolina

Pennsylvania

South Carolina

Virginia

West Virginia

Wisconsin

There are five (5) states (Alabama, Arizona, North Dakota, Texas and Washington) with unique anti-indemnification statutes that do not fit in the four above categories.  In 2016, there were only five (5) states (Delaware, Mississippi, New Hampshire, Rhode Island and Vermont) without transportation anti-indemnification laws.

These statutes generally prohibit indemnification provisions that shift risk between parties irrespective of fault; they do not prohibit provisions that shift risk to a negligent party. Additionally, if an indemnification provision is found in violation of an anti-indemnity statute, the provision will be held unenforceable.  There is little case law regarding challenges to states’ anti-indemnification statutes at this time.  However, there is a possibility that such statutes are preempted under federal law 49 U.S.C. 14501, which prohibits states from enacting or enforcing a law, regulation, or other provision related to price, route or service of any motor carrier with respect to transportation of property.

At this time, given the lacking information on state challenges, to avoid being left with no protection at all should a provision be found to violate a state’s anti-indemnification statute, parties should consider securing additional insurance coverage when entering such transportation contracts.

For more information regarding this article, please contact Miranda Russell at 410.230.1092 or mdrussell@fandpnet.com.

 

Payment of Claimant’s Attorney’s Fees After a Successful Appeal

/in /by Payment of Claimant’s Attorney’s Fees After a Successful Appeal

When an employer and insurer appeals a decision of the Maryland Workers’ Compensation Commission there are several positive outcomes which may result.  One possibility is that a jury or judge reduces the amount of permanent partial disability benefits awarded to a claimant.  Because such benefits remain payable to a claimant while an appeal is pending, the employer and insurer may find they have, in fact, overpaid benefits pursuant to the prior award.  Under Maryland law, such an overpayment becomes a credit against future indemnity benefits.  Assuming the employer and insurer properly held the claimant’s attorney’s fees in escrow during the appeal, the question arises: must these attorney’s fees be released to opposing counsel even though the claimant has already been paid all benefits he or she is due?

The longstanding rule in Maryland is that an employer and insurer must pay legal fees to a claimant’s attorney, even in those instances where a claimant has already been paid all compensation due under a modified award.  In Staley v. Board of Education of Washington County, 308 Md. 42 (1986), the Court of Appeals of Maryland discussed in detail the traditional function of an attorney’s fee petition.  When a claimant’s attorney files a fee petition with the Commission and provides a copy to the employer and insurer, the employer and the insurer must reserve in escrow the requested fees.  This provides protection to the claimant’s attorney in that it effectively creates a lien against the claimant’s compensation for the attorney’s legal fees.  The Court went on to explain that an overpayment to the claimant as the result of an operation of law should not prejudicially effect the attorney’s lien.  In short, an overpayment of benefits to a claimant as the result of a successful appeal by an employer and insurer does not extinguish the claimant’s attorney’s lien and the employer and insurer are not discharged of their responsibility to pay these legal fees.

More recently, in Prince George’s County v. Minor, 227 Md. App. 233 (2016), the Court of Special Appeals of Maryland denied attorney’s fees pursuant to a permanency award.  In that case, the claimant’s attorney failed to file a consent form at the time of the hearing before the Workers’ Compensation Commission and no attorney’s fees were awarded in the Commission’s first award of compensation.  The County paid the claimant’s compensation in full before his attorney was awarded fees and before a lien was established.

Minor explicitly distinguished itself from Staley and carved out a narrow exemption to the broader rule that attorney’s fees are due to the claimant’s attorney even if it would result in an overpayment.  Specifically, Minor makes clear that, if claimant’s counsel failed to put the employer and insurer on notice of his or her fees by filing a timely request with the Commission, the employer and insurer are not obligated to pay.  Rather, the claimant’s attorney must seek reimbursement of his or her fees from the claimant directly.

In the instance where an employer and insurer successfully overturn a significant permanency award and payment of attorney’s fees would cause a large overpayment, it is worth considering settlement.  As Sims v. First National Bank of Maryland, 42 Md. App. 309 (1979) makes clear, there is no requirement that settlements address only issues that have not already been litigated.  Keeping this in mind, employers and insurer may wish to consider settling the entire claim following a successful appeal, including any issue of attorney’s fees.

For more information about this article, please contact April Kerns  at 410.230.2975 or akerns@fandpnet.com.

Defending Against the High Prescription Prices of Workers’ Compensation Pharmacies Without a Costly Expert

/in /by Defending Against the High Prescription Prices of Workers’ Compensation Pharmacies Without a Costly Expert

Workers’ compensation pharmacies such as the Injured Workers Pharmacy (tagged as the “Patient Advocate Pharmacy”) and Summit Pharmacy base their marketing platform on providing prescription medications to injured workers with quicker than usual delivery times.  In order to do this, such pharmacies may fill prescriptions unauthorized by workers’ compensation carriers.  When a carrier then refuses to pay the entire billed price, pharmacies like IWP and Summit will file an application with the Virginia Workers’ Commission for full reimbursement.  Defending against these applications either requires a contract between the pharmacy and the insurance company or employer, or it requires showing the prices for the pharmaceuticals exceed the prevailing community rate.  Typically, showing the prevailing community rate requires an expensive expert economist.  Such experts can prove to be cost-prohibitive for many claims.

In an unpublished case before the Virginia Workers’ Compensation Commission, Riggleman v. Riggleman, 05 WC UNP 1386610 (2005), an employer successfully defended against IWP’s pharmaceutical prices without using an expert.  To show the standard community rates, the employer compared the costs at five local pharmacies and “additional local pharmacies” with the cost at IWP.  The employer’s evidence showed that IWP’s charges “exceeded the prevailing community rate.”  The Full Commission further found that “in addition to prescription-filling services, the Injured Workers’ Pharmacy provided ancillary services, such as advocacy services in achieving reimbursement and the shifting of risk of non-payment away from the patient.” IWP’s charges “were not only for the filling of prescriptions, but also for these other charges, which are not provided by the Act.”  Therefore, the employer was not responsible for the full payment.  This case has not been appealed or otherwise cited unfavorably.

Riggleman v. Riggleman seems to suggest that there is an opportunity for employers and insurers to defend against a pharmacy provider’s application without the use of a costly expert.  It may simply require the commission of a data-gathering company to contact pharmacies at random within the appropriate community and inquire what an uninsured individual would pay for relevant prescription medications. This process would likely cost a fraction of what an expert economist would charge.  It is not certain, however, what the required number of pharmacies to survey might be.  Such a determination likely depends on how many total pharmacies are available in a given community.

As a side note, the advent of the new Virginia Workers’ Compensation Medical Fee Schedule has standardized most aspects of the cost for medical care.  However, notably absent from the fee schedule is prescription medications.  Therefore, it appears the fight against prescription prices set by workers’ compensation pharmacies will continue for the foreseeable future.

For more information about this article, please contact Ciara Malone at 571.612.5937 or cmalone@fandpnet.com.

Early Investigation of Workers’ Compensation Claims

/in /by Early Investigation of Workers’ Compensation Claims

Workers’ compensation claims often last for years and, absent a settlement agreement, employers and insurers can remain responsible for the payment of causally related medical treatment for a claimant’s lifetime.  Additionally, once attorneys are involved, there are immediate added expenses for representation and the possibility for a quick resolution fades.  The following are steps that claim adjusters can take in the early investigation of workers’ compensation claims which can help aid in a more expeditious resolution.

  • First, check to see if the Employer’s First Report of Injury has been filed. This will trigger the statute of limitations and will document basic information about the incident, such as time, place, witness and body parts involved.  Note this will not generate a claim or any notice to the injured worker.
  • Consider whether and when to assist the injured worker in filing a Claim Form. This is a fact-specific decision, but the Claim Form can be helpful, especially if there is no dispute as to compensability and if you need subpoena power to investigate possible matches on an Index Report or other evidence of unrelated conditions and injuries.
  • Contact the employer to see if surveillance footage is available for the day and time of an injury. Such footage is more commonplace now with widely available technology, but video often is erased quickly – so act fast to preserve evidence.  If securing a video, make sure it is kept in the ordinary course of business and, if a copy is made, ensure that process is accounted for and documented to avoid any possible questions as to whether the evidence was properly gathered and maintained.
  • Quickly identify any witnesses who may be able to provide a recorded statement, such as coworkers and supervisors. It is best to obtain this information while it is fresh in a witness’ memory.  If an auto accident is involved, obtain any police reports.  Accurate fact-gathering through employment records and witness statements can quickly build a basis to dispute all or part of a claim.  This will also help avoid any change in an injured worker’s description of events, as the version of events as told by witnesses or official documents will help rebut any changes to a story later.
  • Investigate if an injured worker promptly reported his or her alleged incident. He or she has ten days to do so under the Maryland statute (although this rule is generally not strictly enforced).

If the goal of an employer and insurer is to resolve a claim quickly, perhaps through settlement, the above methods of investigation and prompt discussion with an injured worker can be beneficial.  Such investigation will provide necessary information to provide a basic valuation of a claim, assess the likelihood it will be found compensable, and possibly help guide early settlement negotiations.

For more information about this article, please contact John Archibald at 410.230.3064 or jarchibald@fandpnet.com.

F&P Workers’ Comp Spotlights: Barbara Thompson & Barbara Reider

/in /by F&P Workers’ Comp Spotlights: Barbara Thompson & Barbara Reider

Barbara Thompson

Barbara Thompson, who was recently promoted to principal at Franklin & Prokopik (F&P), has a total of 20 years of experience in civil litigation in the field of workers’ compensation defense.  In fact, Barbara’s entire professional career has been focused on workers’ compensation and she brings that wealth of experience and perspective to the cases she handles.

In 1988, Barbara graduated from James Madison University with a Bachelor of Science in Political Science.  She was first introduced to workers’ compensation through an internship program with CIGNA Property & Casualty Company, following which she was hired as a claims adjuster.  Barbara later made the decision to attend law school, and in 1997 graduated, cum laude, from the University of Baltimore School of Law.  After becoming a licensed attorney, Barbara worked primarily as in-house counsel for CIGNA as well as Zurich North America for a combined total of 13 years.  Barbara joined F&P in 2011 and will be celebrating seven years with the firm this month.

During her time at F&P, Barbara has diligently and vigorously litigated countless cases.  Notably, along with F&P Principal David Skomba and Associate Michael Bennett, Barbara defended F&P clients and received a favorable decision from the Court of Appeals in Reger v. Washington County Board of Education, 455 Md. 68 (2017).

Outside of the office, you will most often find Barbara near a barn, ringside at one of her daughter’s horse shows or cheering on her son at a baseball game (always with a camera hanging from her neck).

Barbara A. Reider

Barbara Reider joined Franklin & Prokopik as a paralegal in 2013. Her work is focused in the area of workers’ compensation defense.

Prior to joining Franklin & Prokopik, Barbara worked in the medical field for 15 years. In that time, she was employed as a Certified Medical Assistant, a medical claims processor, and also a phlebotomist. While working in the medical field, Barbara began assisting with the preparation and filing of documentation for her family business, and developed an interest in the legal field. As a result, she decided to make a career change into the legal profession.

In 2013, Barbara received her Associates Degree from the Community College of Baltimore County, where she graduated with honors. While attending school, she continued to work full time, assisting with running her family business and caring for her two children and three dogs. Upon graduating, Barbara was referred to F&P by the director of CCBC’s Legal Studies Department.  During her time at F&P, Barbara has enjoyed working on challenging cases involving the more complex aspects of workers’ compensation law.

Barbara spends most of her free time with her family and is also very active in her church.  Her son recently graduated from high school and is currently serving in the United States Coast Guard as a fireman.  Her daughter is currently being scouted by colleges for her high academic achievements.

Overview of Uninsured and Underinsured Motorist Insurance Coverage Litigation in Maryland

/in /by Overview of Uninsured and Underinsured Motorist Insurance Coverage Litigation in Maryland

Pursuant to Maryland’s Insurance Code, unless the policy holder waives coverage, every motor vehicle insurance policy written in the state of Maryland is required to include options for uninsured motorist (“UM”) and underinsured motorist (“UIM”) coverage. As indicated above, the policy purchaser is permitted by statute to waive said coverage, but policy writers may not refuse to underwrite a policy if the purchaser refuses to waive the UM or UIM coverage.

 UM coverage applies when the policy holder is injured by a third-party tortfeasor who does not have insurance coverage. In that case, the policy holder is entitled to recover from her insurance carrier the damages she could have recovered from the third-party tortfeasor. The recovery is, of course, limited to the UM policy limits under the policy. UIM coverage applies when the insurance carrier’s policy holder is injured by a party that does have insurance coverage, but the policy limits are not sufficient to make the injured party whole. In that case, assuming coverage has not been waived, the injured party is entitled to recover the remaining damages from her insurance carrier (again, up to policy limits).

 Often, when the policy holder brings suit against the third-party tortfeasor, if the plaintiff believes that the tortfeasor’s insurance coverage is insufficient, he will sue his own insurance carrier in the same action to recover UM/UIM benefits. This is not required, as Maryland statute expressly permits a subsequent action to recover UM/UIM benefits. The statute of limitations to bring a UM/UIM claim against the insurance carrier does not begin to run until: (1) the policy holder receives the full policy limits from the tortfeasor; or (2) the insurance carrier denies coverage. Therefore, potential UM/UIM claimants might have much more than the standard three years to file a UM/UIM claim in Maryland.

When and if a UM/UIM claim is actually made, it is contingent on the plaintiff proving she is entitled to damages that cannot be compensated by the tortfeasor. For uninsured motorists, this is relatively straightforward, as there is no coverage available. For a underinsured motorist, this requires a showing of proof (from a litigation standpoint). In order to be entitled to coverage, the Plaintiff must establish that she is entitled to damages above and beyond the policy limits received from the tortfeasor. If she is successful, she is entitled to recover only the damages in excess of the tortfeasor’s insurance policy.

 Whether or not the policy holder ever makes a claim for UM/UIM coverage is almost entirely dependent on the availability and limits of the third-party tortfeasor’s insurance coverage.

Self-Driving Cars: Are Negligent Causes of Action Soon to Be a Thing of the past in Motor Vehicle Accidents?

/in /by Self-Driving Cars: Are Negligent Causes of Action Soon to Be a Thing of the past in Motor Vehicle Accidents?

With so many car manufacturers announcing recently their plans of introducing self-driving cars into the marketplace, one has to wonder how that will affect liability when there is a motor vehicle accident involving one of these self-driving cars. In West Virginia, most, if not all, motor vehicle accident cases are premised on the negligent operation of a vehicle that led to the accident.  However, with computers and machines now in the driver seat (pun intended), new theories of liability will most certainly arise in these cases, with one being strict liability based on a defect with the self-driving car.

In a regular motor vehicle accident, a plaintiff most often asserts negligence as his or her cause of action, which requires the plaintiff to prove: “(1) [a] duty which the defendant owes him; (2) [a] negligent breach of that duty; (3) injuries received thereby, resulting proximately from the breach of that duty;” and (4) damages.  Webb v. Brown & Williamson Tobacco Co., 121 W.Va. 115, 118, 2 S.E.2d 898, 899 (1939) (citations omitted).  Moreover, the Supreme Court of Appeals of West Virginia has stated that negligence is defined as “what a reasonable and prudent person would ordinarily have done under the circumstances . . . .”  Honaker v. Mahon, 210 W. Va. 53, 58, 552 S.E.2d 788, 793 (2001) (emphasis added).  Dating all the way back to 1914, the Supreme Court of Appeals of West Virginia has held that an operator of a motor vehicle must operate said motor vehicle with reasonable care and has applied a negligence cause of action when the operator fails to act with such reasonable care.  Deputy v. Kimmell, 73 W. Va. 595, 80 S.E. 919, 920 (1914).  However, by now removing a person from the driver seat from a motor vehicle, a negligence cause of action does not appear to be the appropriate cause of action for measuring the liability of a self-driving car because a computer and/or machine cannot act as a reasonable and prudent person would have under the same or similar circumstance.  Thus, plaintiffs will most likely have to turn to the theory of strict liability for product defects.

 In West Virginia, strict liability based on an injury caused by a product has three components that create the separate causes of action: (1) a defect of the product; (2) negligence of the manufacturer making or altering the product; and (3) a breach of the warranty covering the product.  Syl. Pt. 6, Ilosky v. Michelin Tire Corp., 172 W. Va. 435 307 S.E.2d 603 (1983). A defective product is one that is not reasonably safe for its intended purpose and can be proven to be defective either by showing that: (1) there was a manufacturing defect; (2) there was a design defect; or (3) there was a use defect caused by inadequate warnings, instructions, or labels. Morningstar v. Black & Decker Mfg. Co., 162 W. Va. 857, 888-89, 253 S.E.2d 666, 682-83 (1979).  A design defect is one in which the entire line of products was designed in such a way that it makes the product potentially harmful and a safer alternative design existed at the time the product was designed.  Id. at 888-89, 682-83. A product contains a manufacturing defect if the product differs from the manufacturer’s design or specifications or from other typical units of the same product line.  Id. at 884-85, 681.

Because a person will no longer be operating these self-driving cars, West Virginia trial courts will be hard pressed to assert liability on the person sitting behind the wheel.  Instead, plaintiffs’ attorneys will most likely take the route of attempting to prove a defect with the self-driving car.  Although there will almost certainly be hurdles for plaintiffs to overcome using a cause of action grounded in defective products, such as increased costs of expert witnesses in trying to prove a defect, the rewards of potentially much higher verdicts may outweigh those costs.  Furthermore, by being able to present a negligence claim against the manufacturer, distributor, and/or seller of the self-driving car for failing to use reasonable care in the designing, manufacturing, and/or warning about the self-driving car, parties to the litigation should feel some level of comfort with the familiar analysis of the “reasonable prudent standard” that exists in normal motor vehicles accidents involving individuals driving the vehicles.  See Yost v. Fuscaldo, 185 W. Va. 493, 497-98, 408 S.E.2d 72, 76-77 (1991).

 It appears that the days of a driver being simply negligent in causing a motor vehicle accident are coming to a close, or at the very least on the decline, with news of the self-driving cars on the way.  Causes of action for negligence may still be asserted against the individual behind the wheel, but it is expected that the main focus of the litigation will be centered on the liability of the manufacturer of the self-driving car.  With the recent tort reform that has been occurring in the West Virginia State Legislature, expect the legislature to tackle the issue to reduce exposure of liability for manufacturers in future sessions, and look for the Supreme Court of Appeals of West Virginia to promptly deal with this issue at the first chance it is given to review a case involving a self-driving car, which appears to be much sooner rather than later.

Virginia Supreme Court Addresses Elements Necessary for a Spoliation of Evidence Inference at Trial

/in /by Virginia Supreme Court Addresses Elements Necessary for a Spoliation of Evidence Inference at Trial

In a case of first impression decided December 28, 2017, the Virginia Supreme Court clarified the requirements for a spoliation of evidence jury instruction where there is no “bad faith” associated with the loss of evidence.  In doing so, the court reversed a verdict for the plaintiff and remanded the case for a new trial.

Spoliation of evidence occurs when a party is aware that litigation is pending or probable involving evidence in the party’s possession or control, and the destruction or failure to preserve the evidence will adversely affect the opposing party’s ability to prove its claims at trial.  If the court finds spoliation of evidence has occurred, it may take various remedial measures depending on the severity of the situation.

In Emerald Point, LLC et al. v. Lindsey Hawkins, et al., the plaintiff tenants alleged that they suffered carbon monoxide exposure as a result of the defendant landlord’s failure to properly maintain the furnace, vents, and flues, resulting in serious bodily injuries.  They filed suit in Virginia Beach Circuit Court for negligence in 2014.

The old furnace that was in place when the carbon monoxide was first discovered was removed from the plaintiffs’ apartment and stored for more than one year.  It was later disposed of before the plaintiffs’ filed suit.  The court agreed to give an instruction to the jury on spoliation of evidence that, “if a party has exclusive possession of evidence which a party knows, or reasonably should have known would be material to a potential civil action and the party disposes of that evidence,” then the jury may infer that the evidence would be detrimental to the case of the party that disposed of it.

 The jury found in favor of the plaintiffs.  The defendant appealed the decision on several grounds, including an objection to the instruction on spoliation of evidence that was given to the jury at trial.  The defendant argued that such an instruction was not warranted, as it was not reasonably on notice of the litigation at the time the furnace was disposed of.  Second, the defendant questioned whether any relief for spoliation of evidence was appropriate without an express finding that it had acted in bad faith in disposing of the furnace.

The Virginia Supreme Court held that “evidence must support a finding of intentional loss or destruction of evidence in order to prevent its use in litigation before the court may permit the spoliation inference.”  Negligent destruction of evidence is not sufficient to warrant an inference of spoliation of evidence.  Therefore, the trial court erred in giving a spoliation of evidence jury instruction without an express finding that the furnace was intentionally discarded.

This decision is a welcome one, as it raises the bar for a spoliation of evidence inference at trial and avoids penalizing a party that may negligently, but without bad faith, discard or destroy evidence when there is a possibility of litigation.

2018 Legal Technology Trends

The start of a new year brings with it reflections as well as predictions.  Here’s a brief look at some of the technology trends expect to impact the legal world and improve outcomes for clients.

  1. Big data and e-discovery: The use of computer technology in the discovery process continues to evolve. It’s expected that in 2018 big data algorithms will become more mainstream, allowing a wide range of businesses, including law firms, to run more efficiently. Specifically, algorithms with predictive analytics can be used to reduce the costs of document review in e-discovery.
  1. Blockchain: The technology behind Bitcoin is expected to find application in other industries as well. Because Blockchain is impossible to hack or forge, it is used to track financial assets.  It is also being used in the so-called “smart contracts” – electronic contracts that utilize the technology to verify and store a user’s signature rather than physically signing a paper contract or clicking various confirmation buttons on an electronic contract.  The technology is expected to be of great use in the financial, healthcare, and insurance industries.
  1. Internet of Things: Experts estimate that approximately 8 billion “things” worldwide are now Internet connected, from cell phones and smartwatches to refrigerators and wireless printers.  Electronic personal assistants such as Amazon Echo and Google Home are also becoming more mainstream.  It is possible that data from an appliance or wearable electronic device will become a prevalent source of evidence in litigation.

Winter Slip and Falls Accumulate in the Spring

/in /by Winter Slip and Falls Accumulate in the Spring

Although winter seems like a distant memory for most, claims arising out of slips and falls related to snow and ice claims still seem to accumulate.  Whenever it snows, commercial property owners are faced with the burden of removing snow and ice hazards from their premises or facing legal action should a pedestrian slip and fall and injure himself/herself.  Specifically, a landowner has an affirmative duty to keep premises reasonably safe by removing accumulations of snow and ice.  Commercial landowners continue to be sued despite their efforts to do so; however, the Delaware Superior Court has for the first time recognized the expertise required in carrying out these efforts.

 On December 12, 2017, Delaware Superior Court Judge John A. Parkins issued a decision that could potentially curb some of the more futile snow and ice removal litigation.  Judge Parkins opined that a plaintiff must proffer expert testimony when disputing the reasonableness of ice remediation efforts. Prior to this decision, the question of whether snow and ice remediation was left to a layman jury which often resulted in early settlements to avoid the risk of trial.

Specifically, in Ridgway v. Acme Markets et al, C.A. N16A-01-183 JAP (Del. Super. Dec. 2017) , a Plaintiff sued after she slipped and fell on ice in the parking lot alleging that ACME Markets, its landlord, and the snow removal contractor were negligent in their efforts to remove snow and ice from their premises.   However, the unrebutted evidence revealed that in the days prior to the Plaintiff’s slip and fall, the parking lot was plowed, the walkways were shoveled twice, salt was applied to the parking lot five times and calcium chloride was applied to the sidewalks twice.   The Defendants moved for summary judgment arguing, among other things, that expert testimony was required to show that the efforts to keep the parking lot clear were unreasonable.

At oral argument, Franklin & Prokopik’s Eric S. Thompson successfully argued that the methodology of removing snow and spreading salt on a commercial property is beyond the purview of a lay person and requires scientific, technical, or specialized knowledge.  He further argued, that the performance of ice remediation on a commercial property should not be discounted to a trivial exercise and is one which requires knowledge of the property, the impact of weather and temperature on the substance being applied, and how best to apply the ice remediation substance.

        Judge Parkins in granting summary judgment agreed and held that:

The accumulation of snow and ice is a natural occurrence.  The mere presence of ice in a parking lot does not, without more, establish negligence.  Even using every available measure to make the premises safe, a defendant cannot be expected to remove every single snowflake or patch of ice from the premises.  In order to understand what is needed and is reasonable under the circumstances to meet an industry standard, expert testimony is required.

 In a case of first impression in Delaware, Judge Parkins granted Defendants’ Motion for Summary Judgment for Plaintiff’s failure to retain a liability expert.

 If you have additional questions on Delaware premises liability or commercial landowner’s obligations for snow and ice removal, please contact our Delaware office at 302.594.9780.