Cambridge Massachusetts Building Expert Directory

Mitigating FCRA Risk Through Insurance

November 30, 2020 — Sergio F. Oehninger, Geoffrey B. Fehling & Matt Revis - Hunton Insurance Recovery Blog
As reported in a recent Hunton Andrews Kurth client alert, Mitigating FCRA Risks in the COVID-19 World (Oct. 23, 2020), consumer litigation claims related to the Fair Credit Reporting Act (FCRA) doubled in the years leading up to the COVID-19 pandemic. After a slight decrease in FCRA filings due to court closures and other COVID-19 restrictions, claims will likely resume their previous upward trajectory. In fact, the Consumer Financial Protection Bureau (CFPB) has already seen an uptick in consumer complaints, many of which mention COVID-19 specific keywords. Given the anticipated rise in FCRA complaints, the alert highlights the need for financial institutions and financial services companies to develop FCRA-compliant policies and procedures, including training on those policies and procedures, to mitigate the risk of FCRA-related enforcement actions and litigation claims, particularly in light of the regulatory changes relating to the COVID-19 pandemic. Another important risk mitigation tool to consider is insurance, which can offer protection when even the most robust preventative measures fail to prevent an FCRA claim. Coverage for FCRA-related claims—often from directors’ and officers’ (D&O) or errors and omissions (E&O) policies—might be broader than one would initially expect. Policies may cover defense costs involving legal fees, as well as indemnification for damages. 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 Read the court decision
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Two Texas Cities Top San Francisco for Property Investors

October 22, 2014 — Brian Louis – Bloomberg
Houston and Austin are the most attractive U.S. markets for buying and developing real estate, topping San Francisco, as growth potential in the Texas cities draws investors from popular coastal areas, a survey shows. The Northern California city ranked third, down from No. 1 last year, according to a report released today by PricewaterhouseCoopers LLP and the Urban Land Institute. Denver and Dallas-Fort Worth rounded out the five markets offering the best prospects for investors in 2015, the poll of more than 1,400 people in the real estate business shows. Manhattan slipped out of the top 10 to rank 14th. Some non-coastal markets are drawing more property investors partly because they offer higher yields than places such as San Francisco and Manhattan, which led the recovery from the financial crisis. The smaller cities also are benefiting from employment growth and increasing numbers of people moving into urban centers, according to Mitch Roschelle, a partner and U.S. real estate advisory practice leader at PricewaterhouseCoopers in New York. Read the court decision
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Reprinted courtesy of Brian Louis, Bloomberg
Mr. Louis may be contacted at blouis1@bloomberg.net

Are Untimely Repairs an “Occurrence” Triggering CGL Coverage?

January 17, 2023 — Christopher G. Hill - Construction Law Musings
All Class A commercial contractors in Virginia are required to have a minimum level of Commercial General Liability (CGL) coverage. As a general rule, this insurance is there for damage to property or persons arising from an “occurrence” that is covered by the policy. Many cases that are litigated relating to coverage for certain events under a CGL policy turn on the definition of “occurrence” and whether the event leading to a request for coverage constitutes an “occurrence.” A recent case in Fairfax County, Virginia, Erie Insurance Exchange v. Spalding Enterprises, et al., is just such a case. In the Spalding Enterprises case, the Court considered the following scenario. A homeowner, Mr. Yen contracted with Spalding Enterprises to fix some fire damage at his home. Spalding promised the repairs would be complete in October of 2019. However, after Mr. Yen paid a $300,000.00 deposit, Spalding Enterprises stated that the work would not be completed until November of 2019. Yen then fired Spalding Enterprises and sued for breach of contract, constructive fraud, and violation of the Virginia Consumer Protection Act. Spalding Enterprises sought coverage from Erie Insurance for the claim and Erie denied coverage and sought a declaratory judgment that the events alleged in the Complaint by Mr. Yen did not fall under the definition of “occurrence” in the CGL policy held by Spalding Enterprises. Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

Ninth Circuit: Speculative Injuries Do Not Confer Article III Standing

February 28, 2018 — Omar Parra and Lawrence S. Zucker II – Publications & Insights
As Dwight Schrute of hit NBC show “The Office” said, “identity theft is not a joke, Jim! Millions of families suffer every year!” In response, Congress has passed a variety of legislation over the years aimed at curbing identity theft. One such piece of legislation, the Fair Credit Reporting Act (“FCRA”), as amended by corollary acts, prohibits the printing of more than the last 5 digits of the credit card number or the credit card number’s expiration date on any sales receipt. Anyone who “willfully fails to comply with [the requirements] is liable to that consumer” for statutory or actual damages, attorney’s fees and costs, and potential punitive damages. But is a statutory violation of the FCRA alone a sufficient injury to confer Article III standing? No, says the Ninth Circuit. Reprinted courtesy of Omar Parra, Haight, Brown & Bonesteel LLP and Lawrence S. Zucker II , Haight, Brown & Bonesteel LLP Mr. Parra may be contacted at oparra@hbblaw.com Mr. Zucker may be contacted at lzucker@hbblaw.com Read the court decision
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Home Prices in 20 U.S. Cities Increase at Slower Pace

February 25, 2014 — Victoria Stilwell – Bloomberg
Home prices in the U.S. climbed at a slower pace in the year through December, pointing to a moderation in the market that will help keep more properties within reach for prospective buyers. The S&P/Case-Shiller index of property values in 20 cities rose 13.4 percent from December 2012 after increasing 13.7 percent in the year ended in November, the group said today in New York. It was the first deceleration since June. The gain matched the median estimate of 33 economists surveyed by Bloomberg. Price appreciation is slowing as rising mortgage rates combined with harsh winter weather to cool home purchases over the past few months. Smaller increases mean more homes will remain affordable as the labor market improves, helping maintain the rebound in residential real estate that has boosted growth. Read the court decision
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Reprinted courtesy of Victoria Stilwell, Bloomberg
Ms. Stilwell may be contacted at vstilwell1@bloomberg.net

Damages to Property That is Not the Insured's Work Product Are Covered

October 27, 2016 — Tred R. Eyerly – Insurance Law Hawaii
Reversing the district court, the Eighth Circuit predicted that under Iowa law, damage to property other than the insured's work product was covered. Decker Plastics Inc. v. West Bend Mut. Ins. Co., 2016 U.S. App. LEXIS 15235 (8th Cir. Aug. 19, 2016). A 1's, Inc. packaged and sold landscaping materials. Decker Plastics Corporation sold plastic bags to A 1's. The plastic bags were filled with sand and rock, and stored outdoors for sale to customers. Because Decker failed to manufacture the bags with an ultraviolet inhibitor, the bags deteriorated in the sunlight. This caused small shreds of plastic to commingle with A 1's landscaping materials. The plastic was a contaminant that could not be inexpensively separated form A 1's products. A 1's had to clean spilled materials from customer sites, purchase replacement bags from another supplier, and pay to clean up its own property. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

In All Fairness: Illinois Appellate Court Finds That Arbitration Clause in a Residential Construction Contract Was Unconscionable and Unenforceable

August 22, 2022 — Gus Sara - The Subrogation Strategist
In Bain v. Airoom, LLC, No. 1-21-001, 2022 Ill. App. LEXIS 241, the Appellate Court of Illinois (Appellate Court) considered whether the lower court erred in enforcing an arbitration clause in a construction contract between the parties and, as a result, dismissing the plaintiff’s lawsuit. The Appellate Court found that even if the arbitration clause was enforceable, the appropriate action would have been for the court to stay the lawsuit, as opposed to dismissing the case entirely. The Appellate Court then considered the language of the arbitration clause and found that several provisions were substantively unconscionable, which rendered the entire arbitration clause unenforceable. The Appellate Court reversed the lower court’s decision compelling arbitration and reinstated the plaintiff’s complaint. In 2018, the plaintiff, Ms. Bain, a disabled senior citizen, hired the defendant, Airoom, LLC (Airoom), to renovate her home. Airoom provided its “Cash Sales Contract,” which included a binding arbitration clause. The clause required that any dispute arising or relating to the contract be resolved by binding arbitration through the American Arbitration Association (AAA), using the Construction Industry Arbitration Rules and Mediation Procedures (Construction Industry Rules). Read the court decision
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Reprinted courtesy of Gus Sara, White and Williams
Mr. Sara may be contacted at sarag@whiteandwilliams.com

When Is an Arbitration Clause Unconscionable? Not Often

April 05, 2021 — Christopher G. Hill - Construction Law Musings
Here at Construction Law Musings, I have discussed the pros and cons of various forms of Alternative Dispute Resolution (ADR), including arbitration. I am a fan of most ADR, but less of one for arbitration than for mediation. However, where the arbitration can be done under a good set of cost-containing rules and with an arbitrator that is experienced in construction, arbitration can help with the resolution of construction claims. Of course, arbitration provisions in construction contracts are routinely upheld by the courts of Virginia with limited exceptions. One of these exceptions is where the arbitration clause is unconscionable and therefore unenforceable. A recent case out of the Western District of Virginia, Marroquin v. Dan Ryan Builders Mid-Atlantic LLC, shows how high a hurdle it is to get a court to invalidate an arbitration provision. In this case, the Marroquins purchased a new construction home from the Defendants. As is often the case in such purchase transactions, Defendant provided a limited warranty agreement (in this case provided by Quality Builders Warranty Corporation (“QBW”)) that along with the sales contract contained a mandatory arbitration provision. The parties executed the limited warranty and the sale proceeded with the Marroquins taking possession. Over the next year or so, the County inspector’s office issued several correction orders to Defendant, and the Marroquins, through counsel, identified numerous defects in construction, many of which they alleged to remain unremedied. Needless to say, they sued for breach of statutory warranty and for breach of the limited warranty. Defendant removed the case to Federal District Court and then moved to compel arbitration. Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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