Cambridge Massachusetts Building Expert Directory

The Hunton Policyholder’s Guide to Artificial Intelligence: SEC’s Recent AI-Washing Claims Present D&O Risks, Potential Coverage Challenges

July 08, 2024 — Geoffrey B. Fehling, Michael S. Levine & Alex D. Pappas - Hunton Insurance Recovery Blog
We have previewed in prior posts the ways artificial intelligence is rapidly changing the way business operate, including the many ways AI has influenced the insurance market, creating both opportunities and risks for policyholders. We later highlighted, based on a recent securities lawsuit, how corporate management may be at risk for the alleged use or misuse of AI and how companies should evaluate their directors and officers (D&O) and management liability policies to ensure that they are prepared to respond to and mitigate AI-driven risks, including claims alleging that a company or its officers and directors made misrepresentations about AI. That potential risk now has regulatory teeth, as the US Securities and Exchange Commission recently charged the founder of an AI hiring startup with fraud based on claims about using AI to help clients find diverse and underrepresented candidates to fulfill diversity, equity, and inclusion hiring goals. Reprinted courtesy of Geoffrey B. Fehling, Hunton Andrews Kurth, Michael S. Levine, Hunton Andrews Kurth and Alex D. Pappas, Hunton Andrews Kurth Mr. Fehling may be contacted at gfehling@HuntonAK.com Mr. Levine may be contacted at mlevine@HuntonAK.com Mr. Pappas may be contacted at apappas@HuntonAK.com Read the court decision
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New York Team’s Win Limits Scope of Property Owners’ Duties to Workers for Hazards Inherent in Their Work

May 20, 2024 — Lewis Brisbois Newsroom
New York, N.Y. (May 9, 2024) - New York Partners Jennifer Oxman and Andrew Harms recently secured dismissal of a personal injury plaintiff’s complaint on summary judgment in Queens County, with a state judge accepting their argument that a porter who allegedly tripped and fell on loose wood in a stairwell had no cause of action against the property owner because it was his job to clean the stairs in the first instance. The porter was not an employee of the property owner, but rather an employee of a property management company. Therefore, the workers compensation bar did not apply to the employee’s claims. In a four-page decision, Justice Chereé A. Buggs of Queens County Supreme Court found that plaintiff’s duties as a porter included cleaning the stairwell and that he saw and cleaned loose pieces of wood on occasions prior to his accident. Justice Buggs held that while the wood debris likely came from an “outside source”, i.e. a contractor performing work at a neighboring building, the source of the debris was not relevant. Rather, what mattered was the fact that the hazard upon which plaintiff tripped was “inherent in or related to” plaintiff’s work responsibilities. By contrast, Justice Buggs held that the contractor who allegedly was the source of the wood was not entitled to summary judgment under the same legal theory because it arguably caused and created the hazard upon which plaintiff tripped. Read the court decision
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Reprinted courtesy of Lewis Brisbois

Procedural Matters Matter!

December 10, 2024 — Suzanne M. Nicholson - Wilke Fleury
As an appellate practitioner, I am keenly aware that sometimes, a procedural matter can doom what would otherwise be a meritorious issue for appeal. Trial attorneys are well-advised to check and double-check procedural rules and case law governing the issues in their cases. Here’s a few recent developments to be aware of. The record on appeal: electronic recordings now available in Santa Clara County. It should not be news to anyone that it is the appellant’s burden to produce an adequate record for appeal. That includes not just the written submissions to the trial court, but also reporter’s transcripts of all proceedings that could have a substantive impact on your case. If you do not have a court reporter present for your hearing, you will be struck trying your best to get an agreed statement or a settled statement should the case go up on appeal. Believe me, that can be a serious challenge. Any omissions or deficiencies are going to result in presumptions made against the appellant. Read the court decision
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Reprinted courtesy of Suzanne M. Nicholson, Wilke Fleury
Ms. Nicholson may be contacted at snicholson@wilkefleury.com

Contingent Business Interruption Claim Denied

April 08, 2014 — Tred R. Eyerly – Insurance Law Hawaii
The insured's claim for contingent business interruption ("CBI") coverage was denied in Millennium Inorganic Chemicals Ltd. v. Nat. Union Fire Ins. Co. of Pittsburgh Pa., 2014 U.S. App. LEXIS 3096 (4th Cir. Feb. 20, 2014). Millenium processed titanium dioxide, a compound used for its white pigmentation, at its plant in Western Australia. Millennium purchased natural gas to process the titanium dioxide from Alinta Sales Pty Ltd., a natural gas supplier. Alinta purchased gas from Apache Corporation. Once Apache processed the natural gas, it was injected into a pipeline. The gas from Apache's facility was commingled with that obtained from other producers, resulting in a mix of gas in a single pipeline. Alinta had sole ownership of the gas once it entered the pipeline. Under Alinta's contract with Millennium, title to the gas passed to Millenium only at the time of delivery, i.e., when the gas left the pipeline and was delivered to Millennium's facility through a separate delivery line. Millennium had no contract or business relationship with Apache, and the contract it had with Alinta made no reference to Apache. An explosion occurred at Apache's facility causing its natural gas production to cease. As a result, Millennium's gas supply was curtailed, and it was force to shut down its operations for a number of months. 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

Let’s Talk About a Statutory First-Party Bad Faith Claim Against an Insurer

February 19, 2024 — David Adelstein - Florida Construction Legal Updates
Let’s talk about a statutory first-party bad faith claim against an insurer under Florida law. A recent opinion, discussed below, does a nice job providing a synopsis of a first-party statutory bad faith claim against an insurer: The Florida Legislature created the first-party bad faith cause of action by enacting section 624.155, Florida Statutes, which imposes a duty on insurers to settle their policyholders’ claims in good faith. The statutory obligation on the insurer is to timely evaluate and pay benefits owed under the insurance policy. The damages recoverable by the insured in a bad faith action are those amounts that are the reasonably foreseeable consequences of the insurer’s bad faith in resolving a claim, which include consequential damages. “[A] statutory bad faith claim under section 624.155 is ripe for litigation when there has been (1) a determination of the insurer’s liability for coverage; (2) a determination of the extent of the insured’s damages; and (3) the required [civil remedy] notice is filed pursuant to section 624.155(3)(a).” Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Duty to Defend Negligent Misrepresentation Claim

April 15, 2014 — Tred R. Eyerly – Insurance Law Hawaii
The Kansas Court of Appeals determined that the insurer must defend claims of negligent misrepresentation against its insured. Central Power Sys. & Servs. v. Universal Underwriters Ins. Co., 2014 Kan. App. LEXIS 9 (Kan. Ct. App. Feb. 21, 2014). Central Power contracted to furnish Eagle Well with 10 oil-rig engines and 10 oil-rig transmissions. Eagle Well alleged that Central Power informed them that the engines and transmissions would be operational without any additional components. As is turned out, the engines could not operate without a wiring harness. Eagle Well had to hire a third party to make wiring harnesses that would meet their needs and to install the wiring harnesses. Eagle Wells sued Central Power, alleging damages in the form of lost profits for the time it took to make the engines independently operational. Further, damages were incurred due to money needed for the costs of purchasing the wiring harnesses from the third party and attaching the harnesses to the engines. Claims asserted against Central Power included breach of contract, negligence and negligent misrepresentation. 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

Traub Lieberman Partner Lisa M. Rolle Obtains Pre-Answer Motion to Dismiss in Favor of Defendant

August 16, 2021 — Lisa M. Rolle - Traub Lieberman
Traub Lieberman Partner Lisa M. Rolle obtained a motion to dismiss in favor of an international hotel chain. In the case brought before the U.S. District Court, Southern District of New York, the Plaintiff sustained a slip and fall injury in a Portuguese hotel (“Hotel”), which was allegedly caused by violations of building codes and New York and Portuguese negligence laws. The Plaintiff notes that the Hotel utilized the branding affiliated with the international hotel chain, and the named corporate entities are subsidiaries of the parent company of the international hotel chain. Further, Plaintiff alleged that the named corporate entities “owned, operated, maintained, and controlled” the Hotel where the accident occurred, as the international hotel had previously acquired the entity which owned the spa branding utilized. In moving for pre-answer dismissal, Traub Lieberman acknowledged purchase of the managing agent of the Hotel, which became a subsidiary of their operations. However, Traub Lieberman asserted that the international hotel chain had not owned, operated, maintained, or managed the Hotel. Under New York law, parent corporations cannot be held liable for the actions of their subsidiaries, except in cases that support piercing the corporate veil. Traub Lieberman argued that the motion should be granted as a parent company cannot be held liable for acts committed by its subsidiary and further claimed that the parent company has never owned or operated the Hotel. Read the court decision
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Reprinted courtesy of Lisa M. Rolle, Traub Lieberman
Ms. Rolle may be contacted at lrolle@tlsslaw.com

Do You Have the Receipt? Pennsylvania Court Finds Insufficient Evidence That Defendant Sold the Product

December 23, 2024 — Gus Sara - The Subrogation Strategist
In State Farm Fire & Cas. Co. v. Coway USA, Inc., No. 22-cv-3516, 2024 U.S. Dist. LEXIS 192849, the United States District Court for the Eastern District of Pennsylvania (District Court) considered whether the plaintiff produced sufficient evidence to establish that the defendant sold and/or marketed a product and, thus, could be held liable for an alleged defect in the product. The plaintiff, a subrogating insurance carrier, brought strict product liability and breach of warranty claims against the defendant—the installer of a bidet in its insured’s home—claiming that the defendant also marketed and sold the bidet. The sole evidence to support a finding that the defendant sold the bidet was the homeowner’s testimony that she bought the product from the installer. The court found that the insured’s testimony, without any documentation or other corroborating evidence, was insufficient to establish that the defendant sold the product. Since proof of a sale is a required element for strict product liability and breach of warranty claims, the District Court granted the defendant’s motion for summary judgment, dismissing the case. This case involved a water loss to the Pennsylvania residence of Mikyung Kim and her husband Adrian Kim (collectively, the Kims) that was discovered in April 2021. An investigation revealed that the water loss originated from the failure of a bidet for a toilet in the second-floor bathroom. The Kims alleged that defendant, Coway USA, Inc. (Coway), sold the bidet and installed it around 2010. An employee of the plaintiff’s liability expert, a materials engineer, opined that a T-connector—a plastic valve that regulates the flow of water to and through the bidet—failed due to overtightening of the connector during the manufacturing process. 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

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