FAIRFIELD CONNECTICUT BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Revel Closing Shows Gambling Is No Sure Thing for Renewal

September 03, 2014 — Christopher Palmeri – Bloomberg
The Revel Casino Hotel was envisioned as a playground for Wall Streeters who hated flying to Las Vegas. Instead, it’s become a money pit for the banks and money managers who spearheaded the New Jersey project, and the losses will keep coming even after closing today. The Atlantic City resort, built at a cost of $2.4 billion, ceased operations after two bankruptcies and a 10-month search for a buyer. Barring a sale, the new owners may be Wells Fargo & Co. and JPMorgan Chase & Co., which provided $125 million in court-approved funding. Previous backers also included Capital Group Cos., the third-largest manager of U.S. mutual funds, and Morgan Stanley, the original investor. The resort fell prey to poor timing, bad design and a misreading of the local market. The Revel saga shows what can go wrong when bankers stray from what they know, according to Charles Geisst, a professor of finance at Manhattan College in New York and author of the book “Wall Street: A History.” Read the court decision
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Reprinted courtesy of Christopher Palmeri, Bloomberg
Mr. Palmeri may be contacted at cpalmeri1@bloomberg.net

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Hartford Stadium Controversy Still Unresolved

September 22, 2016 — Scott Van Voorhis - Engineering News-Record
The Hartford Yard Goats and the city of Hartford, Conn., say Arch Insurance—the surety for the dual developer/prime contractor of the minor-league baseball team’s new, unfinished stadium—has committed to helping complete the project now that the team and its developer have acrimoniously split. Read the court decision
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Reprinted courtesy of Scott Van Voorhis, Engineering News-Record
ENR may be contacted at enr.com@bnpmedia.com

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Massachusetts Federal Court Holds No Coverage for Mold and Water Damage Claim

February 11, 2019 — Brian Margolies - TLSS Insurance Law Blog
In its recent decision in Clarendon National Ins. Co. v. Philadelphia Indemnity Ins. Co., 2019 WL 134614 (D. Mass. Jan. 8, 2019), the United States District Court for the District of Massachusetts had occasion to consider the application of a prior knowledge provision in the context of a claim for mold and water-related bodily injury and property damage. Philadelphia insured a condominium property management company under a general liability insurance policy for the period September 1, 2007 through September 1, 2008. In 2009, the insured was sued by a unit owner alleging bodily injury and property damage resulting from toxic mold conditions resulting from leaks that had been identified in her unit as early as 2004. Notably, the complaint alleged that mold was identified in 2006 and that repair efforts were undertaken, but that these efforts all proved unsuccessful. Plaintiff alleged that she was forced to vacate her apartment in 2008 as a result of the conditions. Read the court decision
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Reprinted courtesy of Brian Margolies, Traub Lieberman
Mr. Margolies may be contacted at bmargolies@tlsslaw.com

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No Signature? Potentially No Problem for Sureties Enforcing a Bond’s Forum Selection Clause

March 21, 2022 — Brian C. Padove - ConsensusDocs
One of the foundational tenets of contract law is that a party may only be bound by terms they agree to, or in other words, if the party did not sign a contract, that party cannot be bound by the terms thereof. While this principle is generally unwavering, there are certain situations in which a non-signatory to a contract may still be bound by the terms of a contract. In particular, this non-signatory issue may arise when a payment bond claimant makes a bond claim, subsequently files a lawsuit, but the bond contains a forum selection clause different than the venue of the lawsuit and the surety seeks to enforce the bond’s forum selection clause. For example, the claimant may have filed its lawsuit against the surety in federal court, even though the bond provides language specifically mandating that no lawsuit shall be commenced by any claimant other than in a state court where the project is located. Thus, the question then becomes, can the surety enforce the forum selection clause against the claimant when the claimant did not sign the bond and/or never agreed to the terms thereof? The short answer, it depends (yes, that is a very lawyer-like answer). Given recent case law over the past decade, however, the surety has a strong argument in favor of enforcement of the forum selection clause. Read the court decision
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Reprinted courtesy of Brian C. Padove, Watt, Tieder, Hoffar & Fitzgerald, LLP (ConsensusDocs)
Mr. Padove may be contacted at bpadove@watttieder.com

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Don’t Spoil Me: Oklahoma District Court Rules Against Spoliation Sanctions

January 08, 2024 — Kyle Rice - The Subrogation Strategist
In Okla. Farm Bureau Mut. Ins. Co. v. Omega Flex, Inc., No. CIV-22-18-D, 2023 U.S. Dist. LEXIS 197755, the United States District Court for the Western District of Oklahoma (the District Court) determined spoliation sanctions were not warranted after a home was demolished for repair following a joint scene examination. The insurer, Oklahoma Farm Bureau Mutual Insurance Company (Insurer) provided a policy of insurance to Michael and Sondra Diel (the Diels). On July 11, 2020, the Diels’ home was struck by lightning and their attic caught fire. Following the loss, Insurer retained both counsel and fire origin and cause experts to inspect the Diels’ property. Insurer’s counsel informed in-house counsel for Omega Flex, Inc. (Omega Flex) via a letter dated July 14, 2020, that a preliminary investigation indicated the fire may have been caused by an Omega Flex product—specifically, TracPipe Corrugated Stainless Steel Tubing (CSST). Insurer’s counsel invited Omega Flex to inspect the property, noting: “It is anticipated that the loss will exceed $300,000” and stating that any inspection “must be completed during the next two weeks. At that time, the homeowner will proceed with demolition to rebuild.” (Emphasis added). Read the court decision
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Reprinted courtesy of Kyle Rice, White and Williams
Mr. Rice may be contacted at ricek@whiteandwilliams.com

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Norfolk Southern Accused of Trying to Destroy Evidence of Ohio Wreck

February 27, 2023 — Jef Feeley - Bloomberg
Norfolk Southern Corp.’s plan to remove wrecked rail cars from a derailment that resulted in potentially poisonous gas being released over an Ohio town will destroy evidence of the company’s liability, lawyers for residents say. Lawyers in proposed class-action lawsuits over the Feb. 3 accident on Friday asked a federal judge to block the company from clearing the wreckage in East Palestine, Ohio. According to the lawyers, Norfolk Southern informed them last week that it planned to move the 11 rail cars by March 1 and would make them available for inspection for only two days. Adam Gomez, a lawyer for East Palestine residents, said in a court filing that it was “common sense” to keep the wreckage where it is for now. “These communities have questions and we need the evidence to answer them,” he said. Read the court decision
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Reprinted courtesy of Jef Feeley, Bloomberg

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NLRB Finalizes Rule for Construction Industry Unions to Obtain Majority Support Representational Status

September 23, 2024 — Aaron C. Schlesinger - Peckar & Abramson, P.C.
On July 26, 2024, the National Labor Relations Board (“NLRB”) issued its Fair Choice – Employee Voice Final Rule (“Final Rule”), which takes effect September 30, 2024. The Final Rule eases the process for unions in the construction industry to convert their status as collective bargaining representative of bargaining unit employees from Section 8(f) to 9(a) of the National Labor Relations Act (“Act”) simply by placing certain recognitional acceptance language in their collective bargaining agreements. As a result, construction industry employers should review their collective bargaining agreements prior to signing to determine if such language exists. Section 9(a) Non-Construction Industry Employers In most industries, not including construction, union recognitional status as collective bargaining representative of the employer’s employees is governed by Section 9(a) of the Act. In order for a Union to obtain recognitional status under Section 9(a), the union must either: (1) file a petition with the NLRB showing support of 30% of the proposed bargaining unit via employee executed authorization cards and win an election of 51% of the employees in the proposed bargaining unit who actually vote; or (2) by reaching an agreement with the employer that the union possesses employee executed authorization cards from 51% of the proposed bargaining unit, which has been confirmed by a neutral arbitrator pursuant to a card count. Once such status is achieved, the union and employer are required to meet and bargain towards reaching a collective bargaining agreement covering the terms and conditions of employment of the union represented employees. A Section 9(a) union cannot have its recognitional status revoked absent the loss of majority support of the employees it represents. Read the court decision
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Reprinted courtesy of Aaron C. Schlesinger, Peckar & Abramson, P.C.
Mr. Schlesinger may be contacted at aschlesinger@pecklaw.com

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Entire Fairness or Business Judgment? It’s Anyone’s Guess

January 09, 2015 — Maurice Pesso, Greg M. Steinberg and Christopher J. Orrico – White and Williams LLP
In lawsuits challenging the validity of business transactions and combinations, the most significant issue is often which standard of review the court applies: the defense-friendly “Business Judgment Rule” or the more stringent “Entire Fairness Standard.” The standard utilized by the court – or more often times the standard which the parties think the court will apply – can drive decisions on motion practice, settlement discussions, and resolution strategy. Under the Business Judgment Rule, directors are presumed to have acted in good faith and their decisions will only be questioned when they are shown to have engaged in self-dealing or fraud. However, if a “Controlling Shareholder” stands on both sides of the transaction, the court will often scrutinize the transaction under the more plaintiff-friendly “Entire Fairness Standard.” So, what constitutes a “Controlling Shareholder?” If the party in question owns more than 50% of a company’s equity, the answer is clear-cut. However, for cases involving stockholders who own less than 50% of a company’s equity and stand on both sides of the disputed transaction, the answer is not so simple. This uncertainty was highlighted in back-to-back decisions by the Delaware Chancery Court in November 2014. On November 25, 2014, the court granted the defendants’ motion to dismiss a derivative lawsuit alleging breach of fiduciary duty in In Re Sanchez Energy Derivative Litigation (“Sanchez”). Vice Chancellor Glasscock held that the complaint failed to plead facts sufficient to raise an inference that two directors with a collective 21.5% equity interest in the company were Controlling Shareholders. The very next day, in In Re Zhongpin Inc. Stockholders Litigation (“Zhongpin”), the Delaware Chancery Court denied the defendants’ motion to dismiss breach of fiduciary duty claims against an alleged “Controlling Shareholder” and members of the company’s board. In Zhongpin, Vice Chancellor Noble held that sufficient facts were plead to raise an inference that a CEO with a 17.5% equity was a “Controlling Shareholder.” Reprinted courtesy of White and Williams LLP attorneys Maurice Pesso, Greg M. Steinberg and Christopher J. Orrico Mr. Pesso may be contacted at pessom@whiteandwilliams.com Mr. Steinberg may be contacted at steinbergg@whiteandwilliams.com Mr. Orrico may be contacted at orricoc@whiteandwilliams.com Read the court decision
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