Articles Posted in Supreme Court of New Jersey

by
Plaintiffs Emelia Jackson and Tahisha Roach purchased used cars from BM Motoring, LLC, and Federal Auto Brokers, Inc., doing business as BM Motor Cars (collectively, BM). As part of the transaction, each plaintiff signed an identical DRA, which required resolution of disputes through an arbitration in accordance with the rules of the AAA before a retired judge or an attorney. Two months later, Jackson filed a demand for arbitration against BM with the AAA, asserting a claim under the New Jersey Consumer Fraud Act (CFA) for treble damages and other relief based on overcharges and misrepresentations by BM. Despite repeated requests by the AAA, BM did not advance the filing fees that the DRA obligated it to pay, or otherwise respond to the claim. The AAA dismissed Jackson’s arbitration claim for non-payment of fees. Six months after her vehicle purchase, Roach filed a complaint in the Superior Court against BM, and similarly, received no response from BM in response to the arbitration demand. Plaintiffs then filed this action against defendants, who moved to dismiss the complaint in favor of arbitration. Defendants contended that they did not contemplate using the AAA as the forum for arbitration, and consistently had not arbitrated customer disputes before the AAA, because of the excessive filing and administrative fees that the AAA charged. In opposition to the motion, plaintiffs asserted that defendants materially breached the DRA by failing to advance filing and arbitration fees, and waived their right to arbitration. Defendants contended that they neither breached the DRA nor waived arbitration because the AAA was not the appropriate arbitral forum. The trial court found that the parties intended to resolve disputes by arbitration. The court ordered the parties to attempt to reinstate plaintiffs’ claims with the AAA; if the AAA refused to administer the claim, plaintiffs could reinstate their complaint. The AAA reinstated the arbitration, and the court dismissed plaintiffs’ complaint with prejudice. The Appellate Division affirmed the dismissal of the complaint, finding that there was a sufficient factual dispute as to the proper forum for arbitration that defendants conduct did not constitute a material breach of the DRA, nor did they voluntarily and intentionally waive their right to enforce the DRA. The Supreme Court reversed the trial court’s judgment, finding defendants’ non-payment of filing and arbitration fees amounted to a material breach of the DRA. Defendants were therefore precluded from enforcing the arbitration provision, and the case proceeded in the courts. View "Roach v. BM Motoring, LLC" on Justia Law

by
Defendant Glenn Ciripompa was a tenured high school math teacher in the Bound Brook School District. Defendant's behavior came under the scrutiny of the Bound Brook Board of Education (Board) after the Board received copies of student Twitter posts alleging "Mr. C" was electronically transmitting nude photographs. An investigation uncovered defendant's pervasive misuse of his District-issued laptop and iPad, as well as evidence of inappropriate behavior toward female colleagues, often in the presence of students. The results of the investigation spurred the Board to seek defendant's termination from his tenured position and served as the substantive allegations of the two-count tenure complaint against defendant. In this appeal, the issue presented for the Supreme Court's review centered on whether an arbitrator exceeded his authority by applying the standard for proving a hostile-work-environment, sexual-harassment claim in a law against discrimination (LAD) case to a claim of unbecoming conduct in the teacher disciplinary hearing. After review, the Supreme Court found that the arbitrator impermissibly converted the second charge of unbecoming conduct into one of sexual harassment. The arbitrator's review was not consonant with the matter submitted; rather, he imperfectly executed his powers as well as exceeded his authority by failing to decide whether Count II stated a successful claim of unbecoming conduct in support of termination. The arbitrator's award was therefore ruled invalid. View "Bound Brook Bd. of Edu. v. Ciripompa" on Justia Law

by
In July 2003, plaintiff Andrew McCarrell filed a products-liability action alleging that Hoffmann-La Roche, Inc. (Roche) had failed to provide adequate warnings about the risks and side effects associated with taking Accutane. Plaintiff timely filed this products-liability action within New Jersey's statute of limitations, but Alabama's limitations period had expired by the time of the filing. The issue is which state's statute of limitations applied under New Jersey s choice-of-law jurisprudence. Roche moved for summary judgment, citing Alabama's two-year statute of limitations. The trial court denied the motion, finding that the governmental-interest test set forth in "Gantes v. Kason Corp.," (145 N.J.478 (1996)), directed that New Jersey's statute of limitations governed the case. The jury found in favor of McCarrell on the failure-to-warn claim, but the Appellate Division reversed based on evidentiary issues. The Appellate Division approved the trial court's application of New Jersey's statute of limitations to the case, however, and the Court denied Roche's petition for certification. After a new trial, a jury found Roche liable for failure to warn, awarding McCarrell $25,159,530. Roche challenged the verdict on the ground that the governmental-interest test had been supplanted by the most-significant-relationship test of sections 146, 145, and 6 of the Second Restatement of Conflicts of Law and argued that, under this test, Alabama's statute of limitations applied. The trial court denied the challenge as untimely. An appellate panel expressly declined to apply section 142 of the Second Restatement, vacated the jury's verdict and award, dismissed McCarrell's complaint as untimely, and did not reach the remaining issues raised by Roche on appeal. McCarrell's petition for certification was granted. The Supreme Court reversed and reinstated the jury's verdict and award. Analysis under section 142 of the Second Restatement lead to the conclusion that New Jersey's statute of limitations was properly applied to this action. The matter was remanded to the Appellate Division for consideration of unaddressed issues remaining on appeal. View "McCarrell v. Hoffmann-La Roche, Inc." on Justia Law

by
Plaintiffs Tamar and Ari Ginsberg, now New Jersey residents, lived in New York during Tamar's pregnancy and at the time of the birth of their daughter, Abigail. Abigail tragically died from Tay-Sachs disease, a genetically inherited, incurable neurological disorder, at the age of three. Plaintiffs sued a New York laboratory owned and operated by defendant Quest Diagnostics Incorporated (Quest), a New Jersey-based medical testing company, alleging failure to provide correct blood test results when Ari sought to determine whether he was a Tay-Sachs carrier. Quest, in turn, asserted a third-party claim against Mount Sinai Medical Center, Inc., a New York hospital, which allegedly tested Ari's blood sample in New York pursuant to its contract with Quest. Plaintiffs also sued several New Jersey-domiciled defendants whom they alleged to have provided plaintiff Tamar with negligent advice and treatment in New Jersey. The issue this case presented for the New Jersey Supreme Court's review in this interlocutory appeal was whether the choice-of-law principles set forth in 146, 145, and 6 of the Restatement (Second) of Conflict of Laws (1971) should have been applied uniformly to all defendants in a given case, or whether courts should undertake a defendant-by-defendant choice-of-law analysis when the defendants are domiciled in different states. Although the appellate panel agreed that New Jersey and New York law diverged in material respects, it concluded that New York constituted the place of injury because it was the state of plaintiffs' domicile during Tamar's pregnancy, the state in which prenatal testing would have been conducted and the pregnancy would likely have been terminated, and the state in which Abigail was born. The panel then considered the contacts set forth in Restatement 145 and the principles stated in Restatement 6 to determine whether New Jersey had a more significant relationship to the parties and the issues than New York. The panel rejected the trial court's assumption that the law of a single state must govern all of the issues in this lawsuit and instead undertook separate choice-of-law analyses for the New Jersey and New York defendants. The panel found that the presumption in favor of New York law was overcome with regard to the New Jersey defendants, but not with regard to Quest and Mount Sinai. Finding no reversible error in the appellate court's decision, the New Jersey Supreme Court affirmed. View "Ginsberg v. Quest Diagnostics, Inc." on Justia Law

by
Plaintiffs Ramon and Jeffrey Cuevas were brothers who were employees of defendant Wentworth Property Management Corporation (Wentworth). In May 2005, Michael Mendillo, president and chief executive officer of Wentworth, hired Ramon to serve as a regional vice president; months later, Wentworth hired Jeffrey as a portfolio manager. Jeffrey was promoted to executive director in July 2007. In the new position, Jeffrey reported directly to defendant Arthur Bartikofsky, Wentworth's executive vice president of operations. Ramon also reported to Bartikofsky. Plaintiffs claimed that they encountered racial discrimination and a hostile work environment while under Bartikofsky's supervision. Many of the degrading remarks directed at Ramon occurred at senior executive meetings, where Mendillo, Bartikofsky, Alan Trachtenberg (in-house counsel), other executives, and regional vice presidents were present. Jeffrey corroborated most of his brother's account. When Jeffrey complained to Trachtenberg, he replied that Jeffrey should calm down and that the remarks should not be taken so seriously. Within the next month, both Ramon and Jeffrey were terminated. Plaintiffs filed an action under New Jersey s Law Against Discrimination (LAD) claiming that they were victims of race-based discrimination, a hostile work environment, and retaliatory firings. Ramon also claimed that Wentworth failed to promote him based on his race. In its defense, Wentworth contended that plaintiffs were terminated for poor work performance. The case was tried before a jury, which returned a verdict against defendants on all claims other than Ramon's failure-to-promote claim. The jury awarded overall damages in the amount of $2.5 million to the two brothers, including $800,000 in emotional-distress damages to Ramon and $600,000 in emotional-distress damages to Jeffrey. The trial court rejected defendants post-trial motions to vacate the jury's verdict and the damages award. In particular, the court denied defendants motion for a remittitur of the emotional-distress damages. In doing so, the court distinguished the comparable cases and verdicts selected by defendants. In the court's view, the award fell far short of one that would be shocking to the conscience. The trial judge also stated that she would refrain from applying her own feel for the case under "He v. Miller," (207 N.J.230 (2011)). The Appellate Division affirmed the trial court's judgment. Finding no error, the Supreme Court affirmed too. View "Cuevas v. Wentworth Group" on Justia Law

by
Plaintiff sought treatment for sleep apnea from an orthodontist. Plaintiff used the appliance given to him for treatment but complained that it caused the dislocation of some teeth. Contending that the orthodontist did not inform him that the appliance may dislocate teeth, plaintiff filed a complaint alleging that the treating orthodontist provided insufficient information to permit him to make an informed decision to proceed with the recommended treatment. Presented for the Supreme Court's review was the "vexing and recurring" issue of whether an affidavit of merit submitted by a plaintiff in an action alleging negligence by a licensed professional satisfied the requirements of the Affidavit of Merit statute (AOM statute). The trial court conducted a "Ferreira" conference and determined that plaintiff submitted a timely affidavit of merit; however, the court dismissed with prejudice plaintiff's complaint because plaintiff submitted the affidavit from a dentist who specialized in prosthodontics and the treatment of sleep apnea. The court stated that plaintiff knew that the dentist who treated him was an orthodontist and that the statute required submission of an affidavit of merit from a like-qualified dentist. In other words, the court determined that plaintiff was required to submit an affidavit of merit from an orthodontist rather than an affidavit from a board-certified prosthodontist who had specialized in the treatment of sleep apnea for twenty years. The Supreme Court concluded after review that the affidavit of merit submitted by plaintiff satisfied the credential requirements of the AOM statute. The Court therefore reversed the judgment of the Appellate Division and remanded the matter to the trial court for further proceedings. View "Meehan v. Antonellis" on Justia Law

by
This appeal arose from a conflict among the three members of IE Test, LLC (IE Test). After a dispute between defendant Kenneth Carroll and the other members, Patrick Cupo and Byron James, IE Test filed an action to expel Carroll, pursuant to the Limited Liability Company Act (LLCA). In 2004,Carroll and Cupo formed Instrumentation Engineering, LLC. Carroll owned a fifty-one percent interest in Instrumentation Engineering, and Cupo owned the remaining forty-nine percent. James was employed by Instrumentation Engineering, initially as Business Development Manager and later as Vice President. Carroll, Cupo, and James entered into a preliminary agreement stating intention to enter into an operating agreement for IE Test. Carroll claimed that Instrumentation Engineering owed substantial sums to him and his companies, and that became a point of contention among Cupo, James, and Carroll soon after they agreed to share ownership of IE Test. Carroll acknowledged that IE Test had no legal obligation to repay him for losses sustained because of Instrumentation Engineering's bankruptcy, but pressed for compensation that would allow him to recover some of his lost investment. By early 2010, Cupo and James were actively pursing a strategy to use the LLCA to expel Carroll as a member of the LLC. The trial court found in IE Test's favor on its claim based on subsection 3(c), reasoning that the "not reasonably practicable" language imposed a less stringent standard than did subsection 3(a). The trial court granted IE Test's motion for partial summary judgment and expelled Carroll as an LLC member. Carroll appealed. In an unpublished opinion, an Appellate Division panel affirmed, construing N.J.S.A.42:2B-24(b)(3), and its counterpart provision in the Revised Uniform Limited Liability Company Act (RULLCA), N.J.S.A.42:2C-46(e), to mandate that a trial judge engage in predictive reasoning in order to evaluate the future impact of an LLC member's current conduct. The panel found that Carroll's relationship with Cupo and James never recovered from Carroll's demand that he be compensated in a manner that permitted him to recoup his lost investment. The Supreme Court reversed. Applied to the record of this case, the standard of subsection 3(c) did not warrant a grant of partial summary judgment expelling Carroll from IE Test. View "IE Test, LLC v. Carroll" on Justia Law

by
Plaintiff Lamar Williams worked and owned a car in Alaska. In February 2010, he arranged through his employer to have the car shipped to New Jersey by defendant American Auto Logistics. After the car arrived, Williams visited the American Auto Logistics facility in New Jersey to pick it up. Williams inspected the car, found no apparent damage, and drove away. On leaving the facility, however, he heard swishing noises in the back of the car. He found water in the trunk and returned to the facility, where defendant's employees removed the accumulated water and offered a small amount of money for water damage. Williams rejected the offer. Williams sought out a mechanic who estimated the repairs would cost more than $10,000. He called American Auto Logistics and offered to settle for less than that amount, but the company rejected the offer and refused to pay anything for the damage. American Auto Logistics followed up by sending Williams a letter that disclaimed any responsibility and claimed the car was not damaged during shipping. Williams was twice denied his right to a jury trial by a trial court in the Special Civil Part. On both occasions, the trial court relied on Rule 4:25-7, prescribing certain pre-trial procedures, and sanctioned Williams for failure to comply by denying his right to a jury. In this appeal, the issue before the New Jersey Supreme Court was whether a litigant could lose his constitutionally protected right to a jury trial as a sanction for failure to comply with procedural rules. The case also presented a question about the court rules applicable to the Superior Court's Law Division, Special Civil Part. The Court held trial courts could not deprive civil litigants of their constitutionally protected right to a jury trial as a sanction for failure to comply with a procedural rule. The Court further instructed that Rule 4:25-7 did not apply to proceedings in the Special Civil Part. View "Williams v. American Auto Logistics" on Justia Law

by
This appeal as of right arose from defendants' alleged breach of a settlement agreement executed by defendants and one of the plaintiffs in this action, Globe Motor Company (Globe), to resolve prior litigation between the parties. Shortly after defendants sent two checks totaling $75,000 to plaintiffs to settle the earlier action, a Trustee appointed to represent the estate of an insolvent Minnesota entity brought an adversary proceeding against plaintiffs. The Trustee demanded that plaintiffs disgorge the settlement funds, on the ground that those funds had belonged to the bankrupt entity, not to defendants, and that the transactions were therefore voidable under provisions of the United States Bankruptcy Code, 11 U.S.C.A. 544 and 548. Plaintiffs paid $22,500 to resolve the bankruptcy Trustee's claim. Plaintiffs filed this action against defendants, seeking to recover the money that they paid to settle the bankruptcy proceeding as well as attorneys' fees and costs. The motion judge entered summary judgment for plaintiffs on their breach of contract claim. An Appellate Division panel affirmed that determination, with one judge dissenting. After its review, the New Jersey Supreme Court held that the motion judge improperly granted summary judgment in plaintiffs' favor. The Court concluded that the record did not establish plaintiffs' right to judgment as a matter of law. The case was remanded for further proceedings. View "GlobeMotor Company v. Igdalev" on Justia Law

by
In this appeal, the issue this case presented for the Supreme Court's review centered on whether a law firm practicing as a limited liability partnership (LLP) failed to maintain professional malpractice insurance to cover claims against it, and, if so, whether that failure should cause the revocation of the firm's LLP status, rendering innocent partners personally liable. In July 2009, Mortgage Grader hired Olivo of Ward & Olivo (W&O) to pursue claims of patent infringement against other entities. Mortgage Grader entered into settlement agreements in those matters. In exchange for one-time settlement payments, Mortgage Grader granted those defendant-entities licenses under the patents, including perpetual rights to any patents Mortgage Grader received or obtained through assignment, regardless of their relationship to the patents at issue in the litigation. It is those provisions of the settlement agreement that allegedly gave rise to legal malpractice. In 2011, W&O dissolved and entered into its windup period. W&O continued to exist as a partnership for the sole purpose of collecting outstanding legal fees and paying taxes. The next day, Ward formed a new LLP and began to practice with a new partner. Mortgage Grader filed a complaint against W&O, Olivo, and Ward in October 2012, alleging legal malpractice by Olivo, and claiming that the settlement agreements resulting from Olivo's representation harmed Mortgage Grader's patent rights. The motion court denied Ward's motion to dismiss, first determining that Mortgage Grader had failed to comply with the statutory requirement to serve an affidavit of merit (AOM) on each defendant named in the complaint, and rejected its substantial compliance argument. However, the court also determined that W&O failed to maintain the requisite insurance, which caused its liability shield to lapse and relegated W&O to a GP. Thus, the motion court concluded that Ward could be held vicariously liable for Olivo's alleged legal malpractice. The Appellate Division reversed. The Supreme Court affirmed, finding that law firms organized as LLPs that malpractice insurance did not extend to the firm's windup period, and tail insurance coverage was not required. View "Mortgage Grader, Inc. v. Ward & Olivo, L.L.P." on Justia Law