In a matter tried before Justice Barbara Jaffe in Supreme Court, New York County, GVK Partners James Deegan and Daniel Mevorach obtained a unanimous defense verdict on behalf of our client React Industries, Inc. (“React”)

Prior to trial, general contractor Structure Tone, Inc. settled for $3.625 million with the Plaintiff, who had obtained summary judgment against them under Labor Law 240(1).

The Plaintiff was a steamfitter who fell from a ladder while moving a pipe in a high ceiling under the direction of Structure Tone’s superintendent. The ladder collapsed, causing him serious and permanent injuries and ending his career as a steamfitter. At trial Structure Tone sought to recover against various subcontractors, including our client React, alleging it was entitled to contractual indemnification.

Structure Tone relied on a Blanket Insurance/Indemnification Agreement that it required all of its subcontractors to sign periodically. The jury agreed with our argument that the Blanket Agreement was not triggered because our client had no written or oral agreement with Structure Tone to perform work on the jobsite, and instead that our client was on the job site pursuant to an oral arrangement with Structure Tone’s direct contractor, FRP Sheet Metal Contracting Corp.

The contractual arrangements here were a bit unusual. In resolving a prior appeal, the Appellate Division, First Department found questions of fact about whether our client React had a contractual indemnification obligation to Structure Tone. Structure Tone had originally intended to hire our client, React, to manage and retain sub-subcontractors to complete the entire HVAC portion of the work, which is composed of two parts: mechanical work done by steamfitters and ductwork done by sheet metal workers. However, React was barred by the building management company from contracting with Structure Tone because React had a mechanic’s lien on the building. Structure Tone then wrote out purchase orders to sheet metal contractor FRP, one for mechanical work and one for sheet metal work. FRP had an oral “gentleman’s agreement” with React where React would handle the mechanical work. React then subcontracted the actual performance of the mechanical work to Plaintiff’s employer, FL Mechanical. We successfully convinced the jury that under this scenario, React lacked the relationship with Structure Tone necessary for the Blanket Insurance/Indemnification Agreement to apply.

Kenneth S. Merber successfully defends a commercial bus and its driver after a 4 week trial in the Superior Court of New Jersey, Bergen County, Law Division. The case of Juan Pablo Morales Hurtado v. New Service, Inc. and Abel Reinoso involved a 28 year old Hispanic man whose Honda Civic was rear ended by the defendants’ bus in Fort Lee, NJ. Following the accident, the claimant was immediately transported by ambulance to a hospital. He sought continuous treatment for 2 1/2 years and was diagnosed with multiple herniated discs, spondylolysis and spondylolisthesis. Plaintiff’s course of treatment included, chiropractic, orthopedic, neurologic care and pain management. After 5 epidural steroid injections failed to resolve his pain, he underwent multi-level laminectomy, discectomy, decompression and interbody fusion surgical procedures. Thereafter, Mr. Hurtado underwent a long course of physical therapy and rehabilitation. Plaintiff claimed he was permanently injured. Plaintiff’s past medical expenses totaled more than $500,000. His life care expert projected future medical expenses totaling more than $4 million. Mr. Merber convinced the 8 person jury that Plaintiff only suffered minor injuries as a result of the collision and that his spinal conditions were neither caused nor exacerbated by the trauma from the accident. Mr. Merber argued that Morales Hurtado had the surgery to address his long standing conditions and the possibility of future instability despite the fact that there was no evidence Plaintiff ever complained of back pain or sought any treatment for same prior to the accident at issue. Although defendants had offered $750,000 prior to trial, on January 6, 2016, the jury returned a verdict of only $50,000 for pain & suffering and $71,600 for medical expenses. These amounts were reduced by 20% for plaintiffs comparative negligence.

New York defendants scored a significant procedural victory recently, when the Appellate Division ruled that personal injury plaintiffs cannot video record independent medical examinations (“IME’s”) without prior court approval. The unanimous decision by a four-judge panel halts a growing trend of plaintiffs recording IME’s for expert impeachment, but equally as important, it highlights the hurdles that defendants oftentimes face at the trial court level.

In the damages trial of Bermejo v. New York City Health and Hospital Corp., 2015 WL 7270707 (2d Dep’t. 2015), the defense called a well-known orthopedist, Dr. Michael Katz, to testify on the issue of the plaintiff’s injuries. Throughout Dr. Katz’s testimony, Queens Supreme Court Justice Duane Hart exhibited a shocking amount of defense bias, which would form a basis for the Appellate Division’s eventual rebuke of the lower court. Justice Hart repeatedly placed his personal suspicions about Dr. Katz’s credibility ahead of evidence that was before the jury, in an obvious attempt to undermine the expert’s credibility and take down the IME industry in general.

Justice Hart eventually declared a mistrial on the issue of plaintiff’s surreptitious and undisclosed video recording of Dr. Katz’s IME, but not before he unequivocally and repeatedly accused the medical expert of lying under oath, inexplicably fixating on Dr. Katz’s seven-figure salary and popularity among the defense bar. In what amounted to a professional assassination, Justice Hart threatened criminal prosecution and professional censure of the doctor, calling on insurance companies to stop hiring him for IME work. Outrageously, the judge even threatened to impose the maximum amount of sanctions on defense counsel unless they stated, on the record, that their expert had lied under oath.

On November 18, 2015, the New York State Supreme Court Appellate Division, Second Department, ruled that plaintiffs have no legal right to video record IME’s and that any requests must be decided by the trial court on a case-by-case basis. It further ruled that video recordings are only permissible when plaintiffs can prove “special and unusual circumstances,” and that they must be disclosed before trial. Moreover, the Appellate Division excoriated Justice Hart for committing an “avalanche of errors” during trial and for his improper and oftentimes outrageous conduct toward the defense. It accused the judge of undertaking “extraordinary efforts” to end Dr. Katz’s medical career and found that the judge’s unfounded accusations “thoroughly intimidated” Dr. Katz so as to prevent him from testifying at any re-trial of the matter.

Given the requirement that defendants are to disclose video surveillance of plaintiffs before trial (or even sometimes before depositions), Bermejo is a welcome ruling in the plaintiff-friendly confines of New York City’s trial courts. The Second Department has stated that plaintiffs must play by the same rules as their counterparts, and in doing so, it has taken a small step to a more even playing field.

On January 10, 2012, New York’s highest court, the Court of Appeals, decided in Toledo v. Christo that the proper method for calculating preverdict interest on future wrongful death damages in personal injury cases is to discount damages to the date of death and award interest on that amount from the date of death to the date of the verdict. The court’s decision in calculating interest from the date of death, rather than verdict, confirms the rule that prejudgment interest in a wrongful death case is an “element” or “part” of the damages and rejects the defense argument that awarding interest on future damages that have yet to be realized is an unfair windfall for the plaintiff.

In Toledo, the plaintiff was killed in a construction accident on September 21, 2002, and the decedent’s estate brought a negligence and wrongful death action against the defendant church. On December 3, 2007, the jury rendered an award in favor of the plaintiff that included future damages in the amount of $3,562,000. The plaintiff submitted a proposed judgment to the trial court pursuant to the New York statute that discounted the jury’s award of future damages to the date of verdict and then further to the date of the decedent’s death, arriving at a value of $2,487,465. The interest was then calculated on that discounted rate at the statutory interest rate of 9% from the date of death to the date of verdict, arriving at a total future damages award of $4,295,595.

The Appellate Division, First Department, initially reversed, holding that interest on future damages should only be calculated from the date of the verdict. Upon reargument, the First Department vacated its decision and held “whereas here, the award of future damages was discounted by the court to the date of liability, which is the date of death, the award of interest from that date to the date of judgment was proper.” The Court of Appeals granted the defendant leave to appeal and affirmed the First Department’s decision.

The Court of Appeals’ reasoning in holding that preverdict interest on future damages calculated from the date of death does not constitute a windfall for the plaintiff is premised upon the theory that damages should have been paid at the time the loss was suffered, which is the date of death. Thus, the court confirmed that future damages are owed as of the date of death, and such award should include interest calculated from the date of death as well. In essence, what the court’s decision means for litigants in wrongful death cases is that prejudgment interest is a part of the damages, running from the date of death, and not the verdict date.

As a result of the court’s holding in Toledo, defendants should heed that the already large awards upheld in wrongful death cases will be significantly increased by a statutory interest of 9% that is calculated from the date of death to the date of verdict, particularly in light of the fact that these cases take many years to litigate before a jury verdict is rendered.

In a decision earlier this month, the Second Circuit reinstated disparate treatment and retaliation claims filed by a former New York City, Administration for Children’s Services (“ACS”) Director of its Equal Employment Opportunity Office and held that a plaintiff at the pleading stage “does not need substantial evidence of discriminatory intent” but rather “gets the presumption of discriminatory intent.” Littlejohn v. City of New York, No. 14-1395-CV, 2015 WL 4604250 (2d Cir. Aug. 3, 2015). The District Court granted defendants’ 12(b)(6) motion to dismiss in its entirety on the grounds that she failed to adequately plead her discrimination claims. In the opinion, the Second Circuit closely examined the pleading standards for Title VII discrimination claims and clarified that, at the pleadings stage, the plaintiff does not have to show an ultimate prima facie case of discrimination and gets the benefit of a temporary presumption such that the pleadings must be viewed in the light of most favorable to plaintiff. “The plaintiff cannot reasonably be required to allege more facts in the complaint than the plaintiff would need to defendant’s motion for summary judgment made prior to the defendant’s furnishing of a non-discriminatory justification.”

Significantly, the Circuit Court held that a Title VII plaintiff satisfies the FRCP 8(a)(2) notice pleading standard of “plausibility” under the Supreme Court’s Iqbal decision simply by alleging the prima facie elements of her case. In Iqbal, the Supreme Court said that a plaintiff alleging discrimination must plead “enough facts to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S.662, 697 (2009). Looking to the “quartet of cases” led by McDonnell Douglas v. Green, 411 U.S. 792 (1973) as well as Swierkiewsicz v. Sorema, NA, 534 U.S. 506 (2002) and Ashcroft v. Iqbal, 556 U.S.662 (2009), the Second Circuit held that the Iqbal requirement of “plausibility” applies to Title VII complaints of employment discrimination but does not affect the benefit to plaintiffs of the McDonnell framework for burden-shifting between parties, including the temporary presumption in plaintiff’s favor.

The Circuit Court then considered “…what, in the Title VII context, must be plausibly supported by factual allegations when the plaintiff does not have direct evidence of discriminatory intent at the outset.” The court explained, “absent direct evidence of discrimination, what must be plausibly supported by facts alleged in the complaint is that the plaintiff is a member of a protected class, was qualified, suffered an adverse employment action, and has at least minimal support for the proposition that the employer was motivated by discriminatory intent. The facts alleged must give plausible support to the reduced requirements that arise under McDonnell Douglas in the initial phase of Title VII litigation. The facts required by Iqbal to be alleged in the complaint need not give plausible support to the ultimate question of whether the adverse employment action was attributable to discrimination. They need only give plausible support to a minimal inference of discriminatory motivation.”

Turning to Littlejohn’s retaliation claim, the Circuit Court rejected the application of a so-called “manager rule” that excludes from “protected activity” any EEO opposition that falls within the employee’s scope of duties. Here, the defendants contends that Littlejohn’s complaints of racial discrimination were not protected actions under §704(a) because it was part of Littlejohn’s job responsibilities to investigate complaints of Title VII violations in her role as Director of the EEO office. Unimpressed with this argument, the Second Circuit held that, “[t]o the extent an employee is required as part of her job duties to report or investigate other employees’ complaints of discrimination, such reporting or investigating by itself is not a protected activity under § 704(a)’s…. But if an employee-even one whose job responsibilities involve investigating complaints of discrimination-actively ‘support[s]’ other employees in asserting their Title VII rights or personally ‘complain[s]’ or is ‘critical’ about the ‘discriminatory employment practices’ of her employer, that employee has engaged in a protected activity under § 704(a)’s….”

While the plaintiff will ultimately be required to prove that the employer-defendant engaged in discriminatory or retaliatory conduct, the initial pleadings phase of the case has been notably relaxed for the offended employee-plaintiff. There does seem to be a trend in the legislature and the courts to enlarge the scope of employment practices litigation through stricter regulations, and now greater latitude in this first pleading phase of a case.

The Court of Appeals recently issued three decisions on the so-called Scaffold Law, New York Labor Law 240(1), taking on both of the elements required to impose Scaffold Law liability (that a plaintiff is engaged in a “protected activity” and faced with a “height-related risk”) in the first two cases, and in the third case, addressing the “sole proximate cause” defense. The Court of Appeals continues to take a pragmatic approach to the question of whether a given task is a “protected activity,” focusing on the physical alteration to a building or structure, and may be slightly narrowing the scope of what can be considered an “elevation-related risk,” by emphasizing the requirement that an enumerated safety device would have prevented the accident; and the court remains resistant to the “sole proximate cause” defense.

In Saint v. Syracuse Supply, Inc., 2015 NY Slip Op 02802, the court clarified the application of the “protected activity,” i.e., erection, demolition, repairing, altering, painting, cleaning or pointing a building or structure, analysis to billboard construction. Although the Court of Appeals has previously held that changing the vinyl advertisement on the face of a billboard does not constitute a “protected activity,” because there is no change to the structure of the billboard, in Saint, the court held that because the installation involved enlargement of the billboard by the attachment of the extensions, work accomplished by the use of the angle iron on the back of each extension, and application of nuts, bolts and nails, the work did involve a physical alteration of the structure of the billboard. Since the work involved a physical alteration to the structure of the billboard, the court concluded that plaintiff was engaged in a “protected activity.” The lesson here is that the court will look to the physical requirements of the project, rather than relying on a categorical approach in determining whether the plaintiff is engaged in a “protected activity.”

In Nicometi v. Vineyards of Fredonia, LLC, 2015 NY Slip Op 02801, the court analyzed whether a worker who slipped on a patch of ice while using stilts to install insulation in a ceiling was subjected to an “elevation-related risk.” The majority refused to distinguish an earlier decision refusing to apply the Scaffold Law to an accident involving stilts, Melber v. 6333 Main St., 91 NY2d 759 [1998], and held that because stilts are not an enumerated safety device, the accident did not implicate the Scaffold Law. The court’s decision may indicate that the court is limiting the scope of “elevation-related” risks to accidents that could have been directly prevented by an enumerated safety device, such as a scaffold or ladder.

In Barreto v. Metropolitan Tr. Auth., 2015 NY Slip Op 03875, the plaintiff stepped into an uncovered manhole, being fully aware that the manhole cover had been removed. In determining that the “sole proximate cause” defense should have been dismissed as a matter of law, the majority focused on three potential causes other than the plaintiff’s negligence that contributed to the accident: a missing guard rail system that should have been installed around three sides of the open manhole, insufficient lighting, and the fact that the manhole cover was too heavy for plaintiff to have put it in place himself. The dissent focused on the fact that the accident allegedly occurred because plaintiff and his co-workers disregarded a supervisor’s instruction to cover the manhole before removing the lighting and the guardrails. The court’s decision here indicates the continuing difficulty in prevailing on the “sole proximate cause” defense.

While none of these Court of Appeals decisions alters the landscape in Scaffold Law litigation, they confirm the longstanding position of the Court of Appeals on the very limited scope of the “sole proximate cause” defense, and highlight the fact-intensive nature of the application of the Scaffold Law. If we were reading tea leaves from the Nicometi decision, we might view it as presaging a slight contraction of the scope of what is considered an “elevation-related” risk.

In a matter tried before Justice Peter Sweeney in Supreme Court, Kings County, James Deegan obtained a unanimous defense verdict on behalf of Coach Bus and bus driver Mark Richards after a three-day trial. The incident occurred in the eastbound lanes of the Brooklyn-Queens Expressway. Plaintiff claimed to have been rear-ended by the Coach bus while in the center lane, forcing plaintiff into a disabled vehicle partially blocking the right lane, which he would have avoided but for the impact from the bus. The bus driver claimed plaintiff was speeding and attempted to pass the bus on the right but struck the disabled vehicle that was obstructing a portion of the right lane, which forced plaintiff’s car into the bus.

Plaintiff, 32 years old at the time of the incident, claimed injuries to his shoulder requiring a right shoulder arthroscopy, an avulsion fracture to his right wrist, and lumbar and cervical herniations. Plaintiff had not worked since the day of the accident. Mr. Deegan successfully argued to the jury that plaintiff was the sole cause of the multiple-vehicle collision with his reckless attempt at passing the bus on the right while speeding, resulting in a defense verdict on liability at trial. An article describing the trial proceedings was printed in the Brooklyn Daily Eagle and can be seen by clicking here.

Matthew J. Vitucci obtained a defense verdict in a case involving a collision between defendant’s vehicle and the vehicle in which plaintiff, a sitting Supreme Court Justice, was a passenger, which vehicle was operated by her husband. Plaintiff’s husband/third-party defendant made contact with defendant’s vehicle while turning left in front of him, traveling from Gerard Avenue onto 138th Street in the Bronx. The matter was tried before Justice Edward Ritholtz in Supreme Court, Queens County.

Plaintiff’s liability expert, Robert Genna, P.E., of the Suffolk County Crime Lab testified that defendant saw third-party defendant turn in front of him for five seconds before the impact, translating to his having 183 feet of stopping distance, and that a mere tap on the brakes would have avoided impact. Defense expert witness testified that the left turn by third-party defendant gave defendant an insufficient time to activate his brakes.

The plaintiff claimed serious injuries, including a comminuted right tibia fracture, requiring surgical implantation of a bone stimulator and seven weeks of inpatient treatment, as well as a permanent diagnosis of deep vein thrombosis. The jury returned a verdict stating that defendant was not negligent in any percentage, thus wholly non-suiting the plaintiff.

VerdictSearch recently again compiled a useful chart of settlements in New York in 2014 in Construction Accident cases. The chart lists the name of the case, date of settlement, court, the type of action and injuries, the name of plaintiff’s counsel and amounts of the settlements, which range from $275,000 to $9.9 million. Out of the 33 settlements listed, 24 were over $1 million with an average settlement in the amount of $3.4 million. Click here for a copy of the Construction Accident Settlement chart for your reference.

The cases are predominantly actions prosecuted under the New York State Labor Law, meant to protect construction workers by holding construction companies, owners and contractors liable for unsafe workplace practices where regulations under this set of laws have been violated and workers injured. Should any of these settlements be of particular interest to you and you require additional information regarding the facts of the case, please contact us and we will attempt to obtain more details.

VerdictSearch compiled a similar chart of verdicts in 2011. Our summary of that chart is available at www.gvlaw.com/New-York-2011-Construction-Accident-Verdict-Summary.php.

Notably, median figures increased $150,000, from $1.75 million to $1.9 million, from 2011 to 2014.

On February 18, 2014, in a 5-2 decision, the New York Court of Appeals in QBE Insurance Corporation v. Jinx-Proof, Inc., et al., affirmed the January 18, 2013, holding of the Appellate Division, First Department, finding QBE Insurance Corporation (“QBE”) to have adequately disclaimed coverage to its insured, Jinx-Proof, Inc. (“Jinx-Proof”), with respect to assault and battery claims asserted in the underlying litigation, even though a defense was initially afforded by QBE subject to a specific reservation of rights to deny coverage pursuant to the assault and battery exclusion.

As you will recall from our January 23, 2013, Legal Alert, “The First Department Focuses On The Applicable Standard When Assessing The Validity of a Disclaimer Rather Then the Label Afforded by the Insurer,” the Appellate Division, First Department, handed down a rare 2-2-1 decision in connection with this matter on January 18, 2013, whereby it affirmed the lower court’s grant of summary judgment to QBE finding coverage was properly disclaimed in connection with the underlying lawsuit, pursuant to the assault and battery exclusion provided by the QBE Insurance Policy issued to Jinx-Proof.

This declaratory judgment action was commenced as a result of the underlying action, which arises out of a bar fight at Jinx-Proof’s Manhattan bar, and was commenced against Jinx-Proof by a patron who sustained injuries after she was hit with a piece of glass thrown by a bar employee. Within 30 days of receiving notice of the accident by Jinx-Proof, QBE issued two letters titled “Reservation of Rights” to Jinx-Proof, whereby it provided notice that although it would be affording a defense to Jinx-Proof in the underlying action, said defense was subject to a reservation of rights to deny coverage for any assault and battery claims.

As expected, the New York Court of Appeals affirmed the holding of the lower courts, with the majority holding that the first of two reservation of rights letters issued by QBE to Jinx-Proof clearly stated that QBE would not be affording a defense or indemnity to Jinx-Proof “under the General Liability portion of the policy for [the underlying] assault and battery allegations,” as said claims were clearly precluded by the policy’s assault and battery exclusion, and that Jinx-Proof did not purchase and, therefore, was not entitled to liquor liability coverage from QBE. The majority further opined that “[a]lthough the [two] letters contained some contradictory and confusing language, the confusion was not relevant to the issue in this case.” Moreover, irrespective of the fact that the letters were both titled “Reservation of Rights,” they were nonetheless effective as they specifically and consistently stated that Jinx-Proof’s insurance policy exclude[d] coverage for assault and battery claims.

Once again, we reiterate that, where even a mere possibility of disclaiming coverage under an insurance policy, an insurer must issue correspondence with unequivocal language that specifically and definitely notifies its insured of the grounds upon which coverage may be denied.