Attorney Advertising

Articles Posted in Business Litigation

by

barbed-wire-on-a-stormy-day-1117143-m.jpgWe previously spoke about injunctions; the court orders that most often forbid one party from doing something either temporarily or permanently. They are the subject of often heated controversies, the ones you see on the news where two sides in a passionate dispute go to court to settle their differences in the modern day equivalent of the Roman Coliseum, otherwise known as the courtroom. The losing party never does like it. He’s the one with his head slumped as the winner too often, and often too early, gloats over his victory. What happens when the losing party ignores the court order and goes ahead and does what he wants anyway? What happens when he violates the temporary restraining order, the temporary injunction, or the permanent injunction? In New York, the right way to enforce an injunction is for the aggrieved party to make a motion to hold the other in contempt for violating the court order. What everyone should remember is that contempt is a two way street; the rules are fair but the punishment can be harsh.

A recent high profile case here in New York that involves an alleged violation of a temporary restraining order, or TRO, concerns Long Island College Hospital in downtown Brooklyn. It was sold to SUNY Downstate Medical Center in 2011. Instead of keeping it open as it said it would when it bought the hospital, SUNY Downstate reportedly has tried to shut the hospital down. New York City Public Advocate Bill de Blasio obtained a temporary restraining order preventing SUNY Downstate from taking any action which could facilitate the shutdown. According to de Blasio, SUNY Downstate violated that TRO by transferring patients and diverting ambulances from the hospital; the hospital staff went so far as to call the police to prevent their patients from being transferred in violation of the TRO. De Blasio even wrote a letter to the New York City Fire Commissioner, Salvatore J. Cassano, asking him to stop diverting ambulances from the hospital. The state court judge that approved the 2011 sale, the Hon. Carolyn Demarest J.S.C., now has invalidated the sale because she reportedly determined that SUNY Downstate did not buy the hospital in good faith; i.e., it did not really intend to keep the hospital open as it claimed.

The rules for holding a party in civil contempt are simple and fair. A recent case, decided by the New York Appellate Division, Second Department on June 5, 2013, illustrates this. Suiss v. Baron, 107 A.D.3d 690, 966 N.Y.S.2d 481, 482 (2nd Dept. 2013), was an action to partition real property. The court ordered the defendant, who occupied the property, to pay money due for the use and occupancy of the real property to a temporary receiver or to give up possession of the property; i.e., she either had to pay to use the property or get out. The defendant, evidently, did not like the order and refused to obey it. The plaintiff tried to enforce the court order by making a motion to hold the defendant in civil contempt, which the lower court granted. In upholding the civil contempt finding, the Second Department held that:

“To prevail on a motion to punish a party for civil contempt, the movant must demonstrate that the party charged with contempt willfully violated a clear and unequivocal mandate of a court’s order, with knowledge of that order’s terms, thereby *691 prejudicing the movant’s rights” (Rubin v. Rubin, 78 A.D.3d 812, 813, 911 N.Y.S.2d 384; see Judiciary Law § 753[A] [3]; McCain v. Dinkins, 84 N.Y.2d 216, 225-226, 616 N.Y.S.2d 335, 639 N.E.2d 1132; McGrath v. McGrath, 85 A.D.3d 742, 924 N.Y.S.2d 805; Matter of Philie v. Singer, 79 A.D.3d 1041, 1042, 913 N.Y.S.2d 745). Additionally, the movant has the burden of proving contempt by clear and convincing evidence (see Matter of Philie v. Singer, 79 A.D.3d at 1042, 913 N.Y.S.2d 745; Vujovic v. Vujovic, 16 A.D.3d 490, 491, 791 N.Y.S.2d 648).

It is only fair that before a court can hold a party in contempt, it has to be certain that the offending party knew what it should not do and went ahead and did it anyway. Putting the order into the party’s hands, and making sure the order is clear, normally takes care of this. It also is fair that the offending party has to cause harm before he can be punished; no harm, no foul, is a reasonable rule. The higher burden of proof, that the violation be established by clear and convincing evidence, rather than the normal preponderance of the evidence, is another way to try to ensure that only the truly deserving are held in contempt.
Continue reading

by

IMG_00000027.jpgThe rules regarding expert’s disclosure in New York, concerning when a Plaintiff or Defendant has to disclose to its opponent an expert witness that it intends to testify at trial if it hopes to use the expert’s affidavit in support of or opposition to a motion for summary judgement, might seem confusing. The rules have caused so much misunderstanding that the Appellate Division, Second Department, went out of its way to clarify them, in a recent decision, Rivers v. Birnbaum, 102 A.D.3d 26, 953 N.Y.S.2d 232 (2nd Dept. 2012). The key to understanding the rules is to understand the decision, both its rationale and the reasons the Second Department went out of its way to explain it in the first place.

As we have previously discussed, if a party serves expert’s disclosure after the Note of Issue and Certificate of Readiness has been filed, without moving to vacate the Note of Issue first, the trial court has the discretion to refuse to consider an expert’s affidavit served in regard to a timely motion for summary judgement. See Rivers v. Birnbaum, supra,102 A.D.3d 26, 953 N.Y.S.2d 232 (2nd Dept. 2012), and Constr. by Singletree, Inc. v. Lowe, 55 A.D.3d 861, 866 N.Y.S.2d 702 (2nd Dept. 2008). In other words, a party might still be able to use the expert’s affidavit or it might not; it depends on the trial court and, as long as the trial court does not abuse its discretion, the party has to live with whatever the trial court decides. The real trick is to figure out what constitutes an abuse of discretion.

Before the Second Department decided Rivers v. Birnbaum, supra, last October, there was a widespread, mistaken, belief that a court would not and could not consider an expert’s affidavit in conjunction with a summary judgement motion unless the party that wanted to rely on it disclosed the expert before the Note of Issue and Certificate of Readiness were filed. Many read Constr. by Singletree, Inc. v. Lowe, supra, as creating such a hard and fast rule. Whether that was wishful thinking or panic, it was reading something into the court’s decision that was not there. As we discussed last time, Constr. by Singletree, Inc. v. Lowe, supra, only held that it was not an abuse of discretion for the trial court to refuse to consider such an expert’s affidavit.

Rivers v. Birnbaum, supra, was the perfect vehicle for the Second Department to clarify the rule. It was a medical malpractice action that had a sympathetic plaintiff, a mother who claimed the doctors, hospital, and other health professionals, who cared for her during her pregnancies missed obvious warning signs of gynecological cancer she since has suffered from. At the conclusion of discovery, after the Plaintiff filed the Note of Issue and Certificate of Readiness, many of the defendants moved for summary judgement; they used affidavits from experts, however, that they had not previously disclosed. If there had been a hard and fast rule, as many believed Constr. by Singletree, Inc. v. Lowe, supra, provided, then the defendants would have been precluded from relying on those experts’ affidavits. The trial court, however, even though the plaintiff cried foul, considered the defendants’ experts’ affidavits and granted the defendants summary judgement. The Second Department upheld the decision, and its reasoning is enlightening.

The main point behind the Second Department’s decision in Rivers v. Birnbaum, supra, is that the central purpose of a motion for summary judgement is to determine whether there is a genuine issue of material fact that requires a trial; if there is one, the motion must be denied. As the court said, precluding a party from relying on an expert’s affidavit merely because it did not disclose the expert prior to the conclusion of discovery, would not necessarily achieve that goal. Rivers v. Birnbaum, supra,102 A.D.3d at 42, 953 N.Y.S.2d at 243 (2nd Dept. 2012). In other words, an arbitrary decision to uphold an unclear deadline, may not be the best way to ensure that justice between the parties to a given lawsuit is done. What makes this guiding principal even clearer is that the Second Department explicitly stated that a trial court could impose strict deadlines for the completion of expert’s disclosure and, as long as the deadline was clearly set beforehand, the trial court could sanction a party for violating it. Rivers v. Birnbaum, supra, 102 A.D.3d at 39, 953 N.Y.S.2d at 241 (2nd Dept. 2012).

In Rivers v. Birnbaum, supra, the court found that the defendants, through the use of their experts, had made a prima facie showing, as they were required to in this medical malpractice action, that, in treating plaintiff, they had not deviated from the accepted standard of medical care. It also found that plaintiff had not raised a triable issue of fact about this; it was not even a close call. As the court pointed out in great detail, plaintiff’s experts’ affidavits were vague, conclusory, and otherwise deficient.

Therein lies the key. Why would the court deny summary judgement, and either require a trial or let plaintiff win, when plaintiff could not establish even the arguable existence of a genuine issue of material triable fact in opposition to the summary judgement motions? Precluding the defendants from relying on their experts’ affidavits merely because they had failed to disclose their experts prior to the filing of the Note of Issue and Certificate of Readiness, especially when the trial court had not set that point as the deadline for expert’s disclosure, would be a waste of time and a miscarriage of justice.
Continue reading

by

1412838_sundown.jpgThe rules governing the use of expert witness affidavits to oppose, or support, motions for summary judgement in New York, especially in the Appellate Division, Second Department, often are misunderstood. There are cases in which the trial court does not consider an expert’s affidavit because the party that tries to use it did not disclose the expert before the Note of Issue and Certificate of Readiness were filed, which is when fact discovery should be completed. See Constr. by Singletree, Inc. v. Lowe, 55 A.D.3d 861, 866 N.Y.S.2d 702 (2nd Dept. 2008). There are other cases, especially more recent ones, in which the trial court considers an expert’s affidavit despite the fact that the expert was not disclosed before the Note of Issue and Certificate of Readiness were filed. See Rivers v. Birnbaum, 102 A.D.3d 26, 953 N.Y.S.2d 232 (2nd Dept. 2012). There actually is a hard and fast rule as to whether a party will be able to use such an affidavit: It’s firmly within the trial court’s sound discretion.

As we previously discussed, an expert witness is allowed to provide her opinion at trial when it would help to clarify an issue calling for professional or technical knowledge, possessed by the expert and beyond the experience and understanding of the typical juror. See De Long v. Erie Cnty., 60 N.Y.2d 296, 307, 457 N.E.2d 717, 722 (1983). An expert often also is necessary to oppose, or support, a motion for summary judgement, which is the procedural equivalent of trial. See Rivers v. Birnbaum, supra, 102 A.D.3d 26, 953 N.Y.S.2d 232 (2nd Dept. 2012).

Plaintiffs and defendants both must disclose, prior to trial, the experts they intend to testify on their behalf at trial. The statute that governs expert’s disclosure, however, times the disclosure in terms of a trial, not in terms of a motion for summary judgement. CPLR 3101(d)(1) provides, in relevant part:

d) Trial preparation. 1. Experts. (i) Upon request, each party shall identify each person whom the party expects to call as an expert witness at trial and shall disclose in reasonable detail the subject matter on which each expert is expected to testify, the substance of the facts and opinions on which each expert is expected to testify, the qualifications of each expert witness and a summary of the grounds for each expert’s opinion. However, where a party for good cause shown retains an expert an insufficient period of time before the commencement of trial to give appropriate notice thereof, the party shall not thereupon be precluded from introducing the expert’s testimony at the trial solely on grounds of noncompliance with this paragraph. In that instance, upon motion of any party, made before or at trial, or on its own initiative, the court may make whatever order may be just.

[Emphasis supplied].

The problem comes from the fact that parties often wait until close to trial to disclose to their opponents the experts they intend to call at trial. They do this for many reasons, including the expense involved, since most experts command sizable fees and parties often want to be sure that the case will actually go to trial before they incur the expense of retaining an expert to testify at trial. There also is the very human trait of not doing something until it absolutely has to be done; there truly is nothing more productive than the very last minute.

The confusion comes from how the disclosure requirements of CPLR § 3101(d)(1), apply to motions for summary judgement; in particular, when parties need to disclose their experts, and what penalties they face if they fail to meet the deadline.

In Constr. by Singletree, Inc. v. Lowe, 55 A.D.3d 861, 866 N.Y.S.2d 702, (2nd Dept. 2008), the Appellate Division Second Department scared all the procrastinators straight. It upheld the lower court’s decision to bar the use of experts’ affidavits in opposition to a motion for summary judgement because the party that wanted to use them failed to disclose them before the Note of Issue and Certificate of Readiness were filed. Put another way, the parties agreed that all the preliminaries were completed, that the case was ready for trial, and then one of them said, “But wait, there’s more.” The court, however, did not go along.

If you look at the decision in Constr. by Singletree, Inc. v. Lowe, supra, you can see why the trial court issued such a harsh decision. The case involved a house which one of the defendants, J.C. Construction Management Corp, built for the other defendant, Lowe. The plaintiff, Construction by Singletree, Inc., was a subcontractor on the same job which sued the defendants to recover the money it claimed it was owed for its work. The issue on appeal was Lowe’s cross-claims against JC to recover money for what he said was JC’s breach of warranty and to collect the liquidated damages called for in the contract between them; i.e., Lowe alleged JC improperly installed the flooring and insulation systems and should pay him as a result. The only problem was, Lowe evidently waited too long to offer any substantial evidence to back up his claims, and then he tried to save the day by labeling that evidence as expert’s disclosure.
Continue reading

by

1241538_calculator.jpgWhen it comes to negotiating the best deal possible most people consider words to be king. If you make an offer there has to be a justification. If you refuse the offer, you immediately have to make a counter-proposal, and justify it. You tout the benefits of your product, justify your asking price, and critique the other side’s position; a few well-placed matter-of-fact observations, should do the trick. What most people do not realize, though, is that sometimes certain things, at certain times, are best left unsaid. Sometimes, silence is golden.

Standard negotiating advice to someone making an opening offer is to justify it. If there is something special about the item you are trying to sell, then say it. If there is something below-par about the product or service that you are trying to buy, then mention it. After all, you will be taken more seriously, and your position given more credence, because you have a reason for your offer. This advice is based, in large part, on the 1978 “Copier Machine Study,” by Ellen Langer, Arthur Blank, and Benzion Chanowith. In that study, a person waiting to make copies was more likely to let someone cut in front of him to make a small number of copies if the person offered some justification.

Katherine Shonk, Editor of Negotiation, the monthly newsletter of Harvard Law Schools’ Program on Negotiation, in an article that first appeared in October, 2011, points out that sometimes it may be wise to not justify an offer, at least not at first. She points out that the “Copy Machine Study” may have more to do with the trivial nature of the request, “Can I make 5 copies?” than with the justification offered for it.

Continue reading

by

827419_fongrafo.jpgTechnology is not the only thing you need to investigate insurance fraud. Technology might tell you who to question, but someone still has to do the questioning. Analysis of big data might give you a lot to talk about, but someone, preferably with a little training and experience, is going to have to have that conversation. Technology might be able to sort through a tremendous amount of otherwise indecipherable data in order to identify, or obtain, clues about possible fraud. No matter how good the technology, no matter how vast the meta-data, no matter how many computers parse the data, a skilled investigator still has to connect the dots, and, eventually, a lawyer still has to convince a jury that those dots create a clear, unmistakable picture of fraud.

The interview, where one real person talks to another, is necessary in all fact-finding, whether it be a fraud investigation, a deposition in litigation, or a criminal prosecution. How to obtain information from people, however, is an art, not a science. There might be rules to follow and methods to learn but, by themselves, they are not enough.

An article in the June 1-2, 2013 Weekend Edition of the Wall Street Journal points out the art, and skill, involved in obtaining information from people who may be reluctant to provide it. The author, Jason Matthews, is an ex-CIA agent with more than 30 years of experience, who worked in what now is known as the National Clandestine Service. He talks about what it takes to convince people to spy against their own country. The key, he argues, is to find out what motivates a person. He describes four basic motivational factors, common to all people, that he used. Known by the acronym MICE, they are: money, ideology, conscience, and ego. According to the author:

Continue reading

by

897692_firewood_5.jpgNegotiations are an important part of everyday existence for all businesses, whether big, medium, or small, whether they are located in New York, around the country, or anywhere in the world. Every time businesses buy and sell goods and services, they negotiate. Business owners want to buy low and sell high. They want to break into a market either by undercutting their competition or by charging a premium for their product to convince buyers of its superior quality. Business negotiations impact the lives of everyday people, too. Everyone knows what a Kindle is, what an iPad is, and what e-books are. Many either have, or know someone who has, at least one of them. In the last few years it’s become common for people to walk around with their nose in their tablet, either reading an e-book or surfing the web. Business negotiations played a big part in making this happen.

A good negotiator is a hard person to find. She’s someone no one else wants to go up against, but everyone wants, and needs, on their side. Whether you can become one is open to debate, but there are a few things every business owner, corporate officer, or attorney, i.e., anyone involved in negotiations on a regular basis, can do to increase their chances of success. Perhaps the most important thing is knowing what you want. Recent news stories point this out.

The United States Department of Justice has sued Apple over its alleged role in price-fixing the retail cost of e-books; the trial started this past Monday, June 3, 2013, in the United States District Court for the Southern District of New York. According to news reports, Apple is charged with conspiring with publishers to raise the price of e-books in 2009 when it sought to enter the e-book market with its iPad. At that time Amazon.com was selling 90% of all e-books, some at a loss, in order to support its e-reader, the Kindle, which it introduced two years earlier. Apple was looking for a way into the market, and the publishers reportedly were looking for a way to increase prices, and presumably profits. Allegedly Apple, at the suggestion of two of the publishers, agreed to a different pricing model than Amazon.com. The agency-model, as it was called, let the publishers set the price for the e-books and set Apple’s compensation as a fixed percentage of the sales price. According to published reports, the Department of Justice alleges that Apple’s entry into the market gave the publishers what they had been looking for: a way to increase the price of e-books. Apple is the sole remaining defendant in the case; the publishers have settled.

Continue reading

by

468027_rubix_cube_solved.jpgThere is no shortage of trial attorneys in New York, or around the country. What makes a good trial attorney, however, is open to debate. How to become one is even more difficult to define. Is it something you can master through hard work and perseverance; is it something you have to have a natural aptitude for; or is it some combination of both? As we previously discussed, there is a lot of practice involved in trial practice. It is important to practice and to do it in the right way; but is it enough?

People believe they know a good trial attorney when they see one and often even when they don’t. Most people base their opinion, in large part, on results. Many believe that a good trial attorney is the lawyer who wins huge verdicts, defeats frivolous lawsuits, repeatedly gets his indicted clients off with not guilty verdicts or hung juries (Bruce Cutler comes to mind), or a prosecutor who finally does send the bad guy away for an extended prison stay (Andrew J. Maloney and John Gleeson sound familiar). Judging trial attorneys based on results alone is at least somewhat misleading. It ignores the fact that lawyers can only play the hand they’re dealt; it’s what they do with that hand that’s important. Would anyone argue that Johnnie Cochrane was a better trial attorney than Clarence Darrow, even though Darrow lost one of the most famous trials in modern history?

Even if the characteristics of a great trial attorney are hard to define, there most certainly are a large number of lawyers who would like to be one, and no shortage of qualified consultants to help them achieve success in any given case. The question is, can this be done and who, if anyone, can do it?

Continue reading

by

639296_horses.jpgWe are going to pick up where we left off in our last article on subrogation in New York. We were talking about a subrogation case I had that showed how to overcome an exculpatory clause in a contract that absolved one of the parties from liability for its own negligence. In my case, it was an alarm company that monitored a warehouse that had a break-in in which clothes valued at several hundred thousand dollars were stolen. If the alarm company’s actions in responding to the alarms at the warehouse amounted to ordinary negligence, the subrogation action would fail because the insured, who signed the contract, could not recover, and therefore neither could the insurer. There could be a recovery, however, if the alarm company’s actions amounted to gross negligence because, at least in New York, a party cannot absolve itself from liability for its own gross negligence. See Sommer v. Fed. Signal Corp., 79 N.Y.2d 540, 554, 593 N.E.2d 1365, 1370-71 (1992).

According to the court, the basic facts were undisputed. The alarm company received alarms that something had happened at the warehouse, and notified the police and the designated representative of the business, as it was supposed to do. The police never arrived. The warehouse representative was told only that the alarms had been received. He thought they might be false alarms, as had happened in the past, and waited approximately a half hour for the alarm company guard to get to the warehouse, investigate, and call him back to let him know whether there had been an actual break in. When he did not get a call back, he went to bed. The alarm company, however, waited until the next shift, approximately three hours after it received the alarms, to have one of its guards respond to the warehouse to investigate, and it never told anyone from the warehouse that it would not be able to respond for so long; both were violations of its own guidelines. It also only had only a small number of guards on duty to respond to calls in a very large, populated area. In order to enter the warehouse the guards first had to travel back to the central station, get the key for the warehouse, and then drive a long distance back to the warehouse. Only then would they be able to investigate the alarms.

The key was not any one thing that the alarm company did wrong with this particular break in. The fact that it waited three hours to have a guard investigate the alarm, when it stated the guard would respond in 15 minutes, was not, by itself, gross negligence. Instead, I argued the evidence of gross negligence was found in a system that inevitably caused such delays: The evidence of the low number of guards on duty; the large area they had to cover; the long distance from the guard station to the warehouse that made it difficult even on a good night to make it to the warehouse in time; and the violation of its own guidelines. This was evidence of the gross disregard for the rights of others, of actions that smack of intentional wrongdoing, which is required to get to trial on claims of gross negligence.
Continue reading

by

377857_conveyor_belt_2.jpgThe last few articles have discussed the basic concepts and rules of subrogation in New York. It is the equitable doctrine that allows an insurer that pays a covered claim to its own insured to stand in the shoes of its insured to recover the money from the person or entity that caused the loss.

Subrogation, once you determine that the insurer can bring the claim, at least in claims involving property loss or damage to businesses, is really an exercise in commercial litigation. Whoever the insured could sue to recover for the loss it suffered, the insurance carrier also could sue; whoever the insured could not sue, the insurer also could not sue.

A good example of this is a subrogation claim I had that involved a theft of a few hundred thousand dollars of merchandise from a clothing warehouse. The thieves, who never were caught, were ingenious. They broke into the warehouse and jerry-rigged a conveyor system so that it brought the clothes right to the loading dock door. Once there, the thieves loaded the clothes into a waiting truck and drove off. The whole operation took approximately 2 hours; not bad for a night’s work.

Continue reading

by

1360030_black_book_in_row_isolated.jpgPerhaps one of the most misunderstood tools found in New York law is the injunction. Injunctions affect businesses big and small because they often are used in commercial litigation. Injunctions frequently make the news, especially when one is granted in a high profile case. Many times there will be news coverage of two parties just outside a courtroom, one triumphantly telling all who will listen that the end of the world has been averted; the other, down-faced and glum, saying only that he will live to fight another day. More often than not, the second one is right; for the injunction they most often talk about is a preliminary injunction, which is a provisional remedy that only lasts until the underlying case is decided on the merits.

Most recently, New York State tried to withhold school aid from New York City because the City and the local teacher’s union have not agreed on a teacher evaluation plan. Some parents of children who attend New York City public schools sued to stop the aid from being cut. A New York state judge ordered the State not to cut the education aid; he did so by issuing a preliminary injunction. This doesn’t mean that the parents won, the State lost, and the aid won’t ever be cut. It does mean that the aid will not be cut for now, at least until the court renders a final judgement on the parents’ lawsuit.

There actually are three different types of what commonly are known as injunctions. Though they might seem confusing, they really are straightforward:

– A Permanent Injunction.

This is a final judgement of the court after a trial on the merits of the case, which normally restrains or enjoins one of the parties from taking some action. It is an equitable remedy issued after all the relevant facts have been gathered, all the necessary discovery has been had, and a verdict has been rendered. A court does not have the power to issue a permanent injunction in advance of trial. See Oppenheim v. Thanasoulis, 123 App.Div. 494, 108 N.Y.S. 505 (1st Dept.1908).

– A Preliminary Injunction.

This stops a party from doing something, or, less frequently, orders that he take certain actions, even before the court has decided the case on the merits. This interim step, also known an injunction pendente lite, is a provisional remedy, often done to keep things as they are, to maintain the status quo, until the case itself has been decided. See CPLR 6301.

– A Temporary Restraining Order.

This is an instantaneous freeze issued while the court decides whether to order a preliminary injunction. That is, even before the court decides whether to stop someone from doing something, it stops that person from doing it, at least temporarily. See CPLR 6301.

Continue reading

Contact Information
99 Smithtown Blvd.
Smithtown, NY 11787
Phone: 631-240-4480 Fax: 631-295-3380
ATTORNEY ADVERTISING

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Please do not include any confidential or sensitive information in a contact form, text message, or voicemail. The contact form sends information by non-encrypted email, which is not secure. Submitting a contact form, sending a text message, making a phone call, or leaving a voicemail does not create an attorney-client relationship.

Copyright © 2025, The Law Firm of Grasing & Associates
JUSTIA Law Firm Blog Design