Legislative Update: Bid Protest Law Changes to Benefit Contractors
November 24, 2019 —
Brett M. Hill - Ahlers Cressman & Sleight PLLCA new statute became effective July 28, 2019 that benefits contractors who have bid protests in Washington. A bid protest is the only way for disappointed bidders to challenge irregularities in the public bidding process on public works projects. Bid protests ensure the integrity of the public bidding system and are the contractor’s only remedy if its bid is improperly rejected or the winning bidder has errors in its bid that render it nonresponsive.
Under the old law, a contractor was required to submit their bid protest within 2 days after the bid opening. The problem was that a contractor often does not know the basis to protest an award without seeing the other bids to determine whether the winning bid was responsive. Many owners provide copies of the bids if requested at the bid opening, but some contractors found that owners were refusing to provide copies of the other bids until after the 2-day protest period expired.
The new law, which passed this last Legislative session[1], states that a contractor has two days after the bid opening to either submit a written protest or request copies of the competing bids. If the contractor requests copies of the competing bids from the owner, the contractor then has until 2 days after the competing bids are provided by the owner before the contractor is required to submit its bid protest.
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Brett M. Hill, Ahlers Cressman Sleight PLLCMr. Hill may be contacted at
brett.hill@acslawyers.com
LA Lakers Partially Survive Motion to Dismiss COVID-19 Claims
June 13, 2022 —
Tred R. Eyerly - Insurance Law HawaiiWhile the appellate court affirmed dismissal of a majority of the claims submitted by the Los Angeles Lakers for closure of the Staples Center and other properties due to COVID-19, a portion of their claims survived. L.A. Lakers v. Fed Ins. Co., 2022 U.S. Dist. LEXIS 31503 (C.D. Calif. March 17, 2022).
Government orders closed the Staples Center in March 2020. The Lakers alleged they lost tens of millions of dollars in revenue. They further alleged that the presence of coronavirus particles on fixtures and building systems caused physical alterations to the covered properties. The Lakers had to upgrade their properties to include new air filters, touchless light switches, toilets and sinks; sleeves or coatings for high-touch surfaces; and plexiglass dividers. The Lakers also alleged that five Metro stations within a mile of the Staples Center, that was used to get to games, were closed by civil authorities due to the presence of COVID-19.
The Lakers submitted a claim for property damage and business interruption to Federal. The claim was denied and the Lakers filed suit. In February 2021, the court granted Federal's motion to dismiss without prejudice, after concluding that the Lakers' allegations of direct physical loss or damage were mere legal conclusions and not sufficient to state a claim.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Retainage: What Contractors Need to Know and Helpful Strategies
June 04, 2024 —
Gerard J. Onorata - ConsensusDocsIntroduction
Most, if not all, construction contracts contain a provision for “retainage.” The origin and concept of retainage dates back to the railroad boom that embraced Great Britain in the 1840s. In its simplest terms, retainage is a mechanism by which an owner or general contractor withholds disbursement of funds from the payment of a requisition in order to secure future performance of a contract and/or to pay for repair of defectively performed work. Retainage typically ranges from five to ten percent, with the amount being reduced as the project progresses to substantial and final completion. One of the reasons for withholding retainage is to incentivize a contractor to complete its work in accordance with the contract terms and conditions. While this may be well-intentioned in concept, it all too often leads to abuse that impacts project cash flow and raises tension between the parties. This typically happens on projects that have delay issues, deficient drawings, and/or claims of defective work. When a project has “gone bad,” the withholding of retainage is one of the first things that an owner will latch onto in order to leverage its position against a contractor. In order for a contractor to put itself in the best position possible, the following negotiation techniques and protective measures should be kept in mind.
Know Your Applicable Statute
Every state except West Virginia has statutes in place that govern the payment of retainage on public projects. On federal projects, the amount of retainage withheld shall not exceed ten percent as set forth in the Federal Acquisition Regulations (“FAR”). The common thread running through these statutes is the payment of interest as a remedy when the retainage is not timely paid. Historically, most retainage statutes were applicable only to publicly funded projects. This has recently changed with a substantial number of state legislatures recognizing that the payment of retainage on private projects was a serious enough problem to warrant regulation. These include Alabama, Arizona, California, Colorado, Connecticut, Idaho, Illinois, Kansas, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Missouri, Montana, Nebraska, Nevada, New Mexico, New York, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, and Vermont. New York’s retainage laws relating to private projects were enacted only this past November.
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Gerard J. Onorata, Peckar & AbramsonMr. Onorata may be contacted at
gonorata@pecklaw.com
Allegations that Carrier Failed to Adequately Investigate Survive Demurrer
July 30, 2014 —
Tred R. Eyerly – Insurance Law HawaiiThe California Court of Appeal reversed the trial court's dismissal of a complaint alleging bad faith for the insurer's failure to adequately investigate the claim. Maslo v. Ameriprise Auto & Home Ins., 2014 Cal. App. LEXIS 564 (Cal. Ct. App. June 27, 2014).
The insured was injured in an auto accident caused by an uninsured motorist. The insured sought policy limits of $250,000 from the insurer. In response, the insurer demanded arbitration. The arbitrator awarded $164,120.91.
The insured sued, alleging the breach of the covenant of good faith and fair dealing. The First Amended Complaint (FAC) alleged the insured was not at fault. The police report found that the uninsured motorist was the sole cause of the accident. The insured provided the police report and medical records to the insurer. When the insured demanded the $250,000 policy limits, the insurer did not respond.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Expert Medical Science Causation Testimony Improperly Excluded under Daubert; ID of Sole Cause of Medical Condition Not Required
April 15, 2014 —
R. Bryan Martin & Whitney L. Stefko - Haight Brown & Bonesteel LLPOn April 4, 2014, in Messick v. Novartis Pharmaceuticals Corp., the United States Court of Appeals for the Ninth Circuit reversed the district court's summary judgment in favor of Defendant Pharmaceutical Corporation because the district court improperly excluded expert testimony. The three-judge panel held that the district court erred by excluding causation testimony offered by Plaintiff's expert it found to be irrelevant and unreliable.
Plaintiff was diagnosed with breast cancer in 2000. In response to her development of osteoporosis after chemotherapy, Plaintiff treated with the drug Zometa for several months in 2002. Zometa is a bisphosphonate, a class of drug commonly used to treat multiple myeloma. Such drugs are generally used to reduce or eliminate the possibility of skeletal-related degeneration and injuries to which cancer patients are particularly susceptible. Novartis Pharmaceuticals Corporation produces Zometa, which was approved by the FDA in 2001 and 2002. In 2005 after encountering issues with her jaw, it was discovered that Plaintiff had osteonecrosis near three of her teeth. The oral specialists treating Plaintiff did so under the assumption that she was suffering from bisphosphonate-related osteonecrosis of the jaw ("BRONJ"), a condition recognized by the American Association of Oral and Maxillofacial Surgeons ("AAOMS"). Plaintiff's BRONJ healed in 2008 - three years after beginning treatment.
Thereafter, Plaintiff brought suit against Novartis for strict products liability, negligent manufacture, negligent failure to warn, breach of express and implied warranty, and loss of consortium. In support of her claims, Plaintiff offered her expert's testimony on ONJ and BRONJ, and on the causal link between plaintiff's bisphosphonate treatment and later development of BRONJ. Novartis filed a Daubert motion to exclude the specific causation testimony of Plaintiff's experts and a motion seeking summary judgment. The district court granted both motions on the basis that Plaintiff's expert testimony was irrelevant and unreliable.
Reprinted courtesy of
R. Bryan Martin, Haight Brown & Bonesteel LLP and
Whitney L. Stefko, Haight Brown & Bonesteel LLP
Mr. Martin may be contacted at bmartin@hbblaw.com; Ms. Stefko may be contacted at wstefko@hbblaw.com
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Cherokee Nation Wins Summary Judgment in COVID-19 Business Interruption Claim
February 01, 2021 —
Sergio F. Oehninger, Geoffrey B. Fehling & Matt Revis - Hunton Insurance Recovery BlogIn a resounding victory for policyholders, an Oklahoma state court granted partial summary judgment for the Cherokee Nation in its COVID-19 business interruption claim. The Cherokee Nation is seeking coverage for losses caused by the pandemic—specifically, the inability to use numerous tribal businesses and services for their intended purpose.
Based on the “all risks” nature of the policy and the fortuitous nature of its loss, the Cherokee Nation sought a partial summary judgment ruling that the policies afford business interruption coverage for COVID-19-related losses. The policy provided coverage for “all risk of direct physical loss or damage,” which the Cherokee Nation contended was triggered when the property was “rendered unusable for its intended purpose.” In support of this view, and consistent with established insurance policy interpretation principles, such as providing meaning to every term and reading the policy as a whole, the Cherokee Nation argued that a distinction must exist between “physical loss” and “physical damage.” This distinction demands an interpretation supporting the “intended purpose” reading of the policy language. Thus, the physical presence of COVID-19 depriving the Cherokee Nation of the use of covered property for its intended purpose triggered a covered loss.
Reprinted courtesy of
Sergio F. Oehninger, Hunton Andrews Kurth,
Geoffrey B. Fehling, Hunton Andrews Kurth and
Matt Revis, Hunton Andrews Kurth
Mr. Oehninger may be contacted at soehninger@HuntonAK.com
Mr. Fehling may be contacted at gfehling@HuntonAK.com
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Home Prices Up, Inventory Down
February 04, 2013 —
CDJ STAFF"Housing is clearly recovering," David Blitzer of Standard & Poor told USA Today. Standard & Poor issued their Case-Shiller Index of home sale prices for November. In their review of twenty metropolitan areas, prices rose in all but one area. In the report for October, housing overall saw a 0.1% decline with gains only in ten cities.
The article attributes this in part to that the inventory of unsold homes was 4.4 months, which was the lowest since May 2005. "Any new listings are getting eaten up right away," said E. J. Bowlds, a broker at Coldwell Banker Bain. He is seeing six to ten competing offers on homes in his area of Washington State.
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The Future of Pandemic Coverage for Real Estate Owners and Developers
November 09, 2020 —
Ashley McWilliams - Saxe Doernberger & VitaShutdowns resulting from the COVID-19 pandemic have prompted an unprecedented number of business income and business interruption insurance claims. Many claims have resulted in litigation and require judicial intervention to determine whether private insurance carriers owe policyholders indemnification for pandemic related losses. Private insurance carriers that have denied the claims, in large part, argue that they did not underwrite coverage for the pandemic and assert that pandemic coverage is much too unpredictable to underwrite. Private carriers contend that a government-backed insurance program is necessary to mitigate the economic impact resulting from pandemic claims.
The COVID-19 pandemic has significantly impacted real estate owners and developers. Real estate owners and developers have sustained business income losses in the form of lost rents at commercial properties, service disruption, labor and/ or material shortages, to name a few. Questions about whether the virus caused “direct physical damage,” as well as whether specific “virus exclusions” on policies, have provided hurdles to coverage under existing schemes, click here.Those that have filed lawsuits against their insurers seeking coverage under current policy terms are having mixed results, at best. Click here to view SDV’s Litigation Tracker. A predictable source of indemnification for future pandemic-related losses would greatly relieve business disruption and, ultimately, the impact on the economy. However, the question remains, who will pay for such massive losses?
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Ashley McWilliams, Saxe Doernberger & VitaMs. McWilliams may be contacted at
AMcWilliams@sdvlaw.com
