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Daily Decision Service Alert: Vol. 22, No. 85 — May 2, 2013
New Jersey Law Journal
STATE COURT CASES
01-2-9811 Hill v. New Jersey Racing Commission, App. Div. (per curiam) (12 pp.) Hill appeals from a final determination of the New Jersey Racing Commission, which disqualified her horse, JS, from his win in a race held at the Meadowlands Racetrack on June 13, 2009, and ordered that the purse be redistributed. The appellate panel finds Hartman v. New Jersey Racing Commission is factually distinguishable and Hill's reliance upon that decision is misplaced. On May 6, 2008, JS tested positive for the presence of Darbepo, an illegal blood-doping substance, and was placed on the New Jersey Steward's List. That information was noted on the USTA's electronic database. Hill purchased JS in early 2009. While notification that JS had been placed on the New Jersey Steward's List was deleted from the USTA's database in error at some point before the horse ran in the race at the Meadowlands on June 13, 2009, there is no evidence that this information was deleted from the USTA database before Hill purchased the horse. Thus, Hill was properly charged with notice that JS had been placed on the Steward's List and could not race in New Jersey until he was retested here under the supervision of New Jersey's racing officials. The panel concludes that the Commission did not abuse its discretion by disqualifying JS and ordering Hill to forfeit the purse won in the June 13, 2009 race.
ALTERNATIVE DISPUTE RESOLUTION ARBITRATION
03-2-9812 Lerner v. Heidenberg, App. Div. (per curiam) (15 pp.) Plaintiff Stephen Lerner appeals from an order granting defendant Robert Heidenberg's motion to compel arbitration. Plaintiff and defendant were partners in Lerner-Heidenberg Associates (LHA). Paragraph 13 of their partnership agreement contains an arbitration clause. The parties had a falling out. Rather than pursuing arbitration, plaintiff filed a complaint in the Chancery Division seeking to dissolve LHA. After the parties failed to reach a settlement through mediation, defendant filed a motion to compel arbitration and stay or dismiss the remaining LHA-related proceedings. Plaintiff opposed this request and argued that defendant had waived his right to compel arbitration by "aggressively litigating" the matter in the Chancery Division. The appellate panel affirms, finding no basis to disturb Judge Carroll's well-supported conclusion that defendant had not waived his right to seek arbitration. Plaintiff initially alleges that defendant waived arbitration when he failed to raise it in his answer. However, the failure to raise arbitration as an affirmative defense is not dispositive on the issue of waiver. Plaintiff also alleges that defendant waived his right to arbitration through his litigation conduct. However, defendant notified plaintiff of his intention to compel arbitration less than four months after plaintiff filed his complaint and six weeks later, after mediation failed, defendant filed a formal motion to compel arbitration. Further, defendant's conduct did not trigger the extraordinary remedy of judicial estoppel.
17-2-9813 Hudson County Improvement Authority v. Michaels, App. Div. (per curiam) (7 pp.) Defendant appeals the Special Civil Part order adjudicating him in violation of N.J.A.C. 7:26-3.4(b) which requires that certain solid waste be disposed of at an approved facility. The panel reverses finding that while there is no question that defendant was dumping solid waste, he did not do so in violation of 7:26-3.4 because he was transporting his own solid waste using a pickup truck and trailer that he testified were below the weight specified in the regulations, which plaintiff did not contest, and he therefore was exempt from the prohibition contained in 7:26-3.4(b). Moreover, plaintiff's plan specifies waste generated in Hudson County and the evidence is that defendant had emptied a storage unit in Union County.
LABOR AND EMPLOYMENT
25-3-9814 Gitto v. City Of Atlantic City, App. Div. (per curiam) (19 pp.) Defendants City of Atlantic City and City of Atlantic City Beach Patrol hired plaintiff as a lifeguard in 1977. In 2005, the mayor appointed plaintiff to the Beach Patrol Pension Commission, and promoted him to lieutenant. The American Federation of State County and Municipal Employees (AFSCME) filed a grievance, claiming Defendants failed to post the job opening in violation of the collective bargaining agreement (CBA). Plaintiff filed a counter-grievance. The City settled AFSCME's grievance by agreeing to rescind plaintiff's promotion. The City also removed plaintiff from his non-salaried position on the Commission. Plaintiffs grievances were denied and his union declined to pursue his claims. Plaintiff filed a complaint alleging violations of the federal and state constitutions, the New Jersey Civil Rights Act, breach of contract, breach of the implied covenant of good faith and fair dealing, and intentional infliction of emotional distress. Plaintiff settled his claims against the Union defendants. The appellate panel finds summary judgment was properly granted to the City defendants where they complied with the procedures in the employment contract and the CBA. The individual City defendants were entitled to qualified immunity. No adverse employment action occurred. Plaintiff failed to submit sufficient evidence to support a hostile work environment claim. Also, plaintiff's removal from the Commission falls within the "policymaking" exception to the prohibition on political affiliation discrimination.
LABOR AND EMPLOYMENT
25-2-9815 Harris v. County of Essex, App. Div. (per curiam) (12 pp.) Plaintiff appeals the grant of summary judgment dismissing his action alleging that his salary since he was rehired after being terminated because of budgetary cutbacks has been less than the compensation paid to employees with lower civil service grades and less experience, which he attributed to age discrimination. The panel affirms, finding that the discrimination claim was barred by the two -year statute of limitations governing LAD claims. Moreover, the panel says that he failed to establish a prima facie case of age discrimination since he failed to proffer any evidence that the county sought another person to perform the same work after he was laid off, nor was evidence presented sufficient to rebut the county's legitimate nondiscriminatory reason for plaintiff's layoff, i.e., budgetary constraints.
LABOR AND EMPLOYMENT
25-3-9816 Reilly v. Village of Ridgewood, Law Div. (Bergen County) (Toskos, J.S.C.) (27 pp.) In this action in which the jury rendered a verdict in favor of plaintiff-firefighter that defendant had violated the Conscientious Employee Protection Act and awarded emotional distress damages of $3.5 million, defendant moves for judgment notwithstanding the verdict, a new trial, or, in the alternative, remittitur. The court denies the motion for JNOV, finding that under the totality of the circumstances, plaintiff established a violation of CEPA and that he provided evidence of emotional distress. The court denies the motion for a new trial, finding that the jury award itself does not rise to the level to warrant a new trial, the length of deliberations does not indicate that the jury failed to conduct a reasonable deliberation, and the court did not err in refusing to admit plaintiff's medical records. The court grants the motion for remittitur, finding the $3.5 million award to be a shocking verdict. Analyzing the case law provided, considering the testimony and feel for the case, under the totality of the circumstances, the court determines that the emotional damage award should be remitted to $500,000. It also determines that plaintiff's attorney shall be awarded fees at $250 per hour. [Filed May 2, 2013]
36-2-9817 Estate of Koeberle v. Topping, App. Div. (per curiam) (8 pp.) Plaintiffs, individually and as executors of the estate of Juliana Koeberle, appeal the summary judgment dismissal of their wrongful death action against Holly Cedro. Koeberle was killed by an auto driven by Kyle Topping as she was crossing the street; Cedro had been traveling in the opposite direction. Plaintiffs alleged that Cedro was negligent in waving Koeberle across the street while she was stopped at a light. The panel affirms, finding that plaintiffs presented no evidence to establish that Cedro acted negligently prior to the accident.
TORTS PERSONAL INJURY
36-2-9818 Newton v. Sams Club, App. Div. (per curiam) (22 pp.) Defendant Sam's Club appeals from a jury verdict finding it seventy percent liable for injuries sustained by plaintiff and from an order denying its motion for a new trial on damages or for remittitur. Plaintiff, a seventy-two-year-old woman, was shopping at a Sam's Club store when another customer, Chong, accidentally struck her with a flatbed cart loaded with boxes. The boxes were stacked so high that Chong could not see in front of him as he pushed the cart. A Sam's Club employee had retrieved the merchandise for Chong and helped him load the cart. Plaintiff suffered a laceration to her leg, which left a thirteen-centimeter scar. Plaintiff sued Sam's Club and Chong in negligence. Plaintiff's expert, Dr. David Lessing, an orthopedic surgeon, diagnosed her with a "laceration to the posterior left calf or leg with altered sensation and a defect of the muscle tendon junction." According to Dr. Lessing, plaintiff's injury and scar were permanent. The jury awarded plaintiff $1,000,000 in damages, apportioning liability seventy percent to Sam's Club and thirty percent to Chong. The appellate panel affirms the judgment as to defendant's liability. Finding the court failed to address the jury verdicts offered by the parties to show that, by comparison, the $1 million damage award was either grossly excessive or within the normal range, the panel remands the issue of damages to the Law Division.
FEDERAL COURT CASES
CIVIL PROCEDURE JURISDICTION AND SERVICE OF PROCESS
07-7-9819 Phillips v. Berenato, Dist. Ct. (Kugler, U.S.D.J.) (5 pp.) On October 10, 2012, Plaintiff filed this action seeking compensation for injuries she claims to have sustained in a 2010 motor vehicle accident. Prior to filing this suit, Plaintiff filed a nearly identical complaint in the Superior Court of New Jersey. One month after Plaintiff filed her federal complaint, Defendant filed the instant motion to dismiss, arguing that the Court should decline to hear the case under the doctrine of Younger abstention. After initially declining to oppose the motion, Plaintiff filed a motion for leave to respond to Defendants motion four months after the original motion was filed. Plaintiffs motion for leave to reply is denied and the Court will consider the motion unopposed. Nonetheless, because Younger and its progeny require federal courts to abstain from entertaining suits that would interfere with pending state court proceedings and this federal proceeding would parallel, but not interfere, with the state proceeding, the Court denies Defendants motion to dismiss. [Filed April 15, 2013]
11-7-9820 Stockroom Inc. v. Dydacomp Development Corp., Dist. Ct. (Walls, S.U.S.D.J.) (13 pp.) Plaintiff-retailer alleges that defendant-software company that sold it an order processing system for online merchants is responsible for faulty credit card transactions caused when its system began issuing improper authorization codes, resulting in a 3% loss in its profits. It asserted claims for breach of contract, breach of the covenant of good faith and fair dealing, violation of the New Jersey Consumer Fraud Act, and breaches of express warranty, implied warranty of merchantability, and warranty of fitness for a particular purpose, which were all dismissed, mostly as time barred. Defendant now moves to dismiss the second amended complaint for failure to state a claim. The motion is granted in part and denied in part. Because Stockroom failed to allege sufficient facts of fraudulent concealment for equitable tolling to apply, any breach of contract or breach of warranty claims stemming from the original installation are barred by the four-year statute of limitations. However, any breach of warranty and breach of contract claims that accrued within four years of filing suit are not time-barred. Dydacomps motion to dismiss the CFA claim is denied because Stockroom has alleged a plausible claim for omission. Dydacomps motion to dismiss the common law fraud claim is granted because Stockroom fails to allege a statement of material fact that is false and a duty to disclose. [Filed April 24, 2013] [For publication]
INTELLECTUAL PROPERTY PATENTS
53-7-9821 Telebrands Corp. v. National Express, Inc., Dist. Ct. (Hochberg, U.S.D.J.) (13 pp.) Defendants move to dismiss Telebrands Corp.s complaint seeking a declaratory judgment of noninfringement and invalidity of Blue Gentians patents, the 941 Patent and the 942 Patent. Telebrands is a New Jersey corporation with its headquarters in New Jersey. Blue Gentian, LLC is a limited liability company organized under Florida law and owned by its managing member, Michael Berardi, a resident of Florida. National Express, Inc. (NEI) is a Connecticut Corporation with its principal place of business in Connecticut. Telebrands is a direct marketing company. Berardi is the sole inventor for the 941 and 942 Patents. Blue Gentian is the assignee of all right and interest in the 941 and 942 Patents. NEI is a licensee of the patents-in-suit from Blue Gentian. Since the parties produce potentially competing products, the patents-in-suit have issued, and Defendants declared their intent to pursue an infringement action, there is a substantial controversy so the Court can exercise subject matter jurisdiction. Since the parties have an extensive licensing agreement that extends beyond merely profit-sharing, Blue Gentian has purposefully availed itself of the privilege of conducting activities in New Jersey and specific personal jurisdiction exists. While the patents are owned by Florida companies, Telebrands is a New Jersey corporation and its potentially infringing product is manufactured in New Jersey, thus venue is proper. Defendants motion to dismiss is denied. [Filed April 11, 2013]
INTELLECTUAL PROPERTY PATENTS
53-7-9822 Jazz Pharmaceuticals, Inc. v. Roxane Laboratories, Inc.,Dist. Ct. (Mannion, U.S.M.J.) (9 pp.) Plaintiff Jazz Pharmaceuticals, Inc. filed a motion to consolidate this case with earlier filed actions, which Defendant Roxane Laboratories, Inc. opposes. This is an action for patent infringement arising from Roxanes filing of ANDA No. 202-090 seeking approval to commercially market a generic version of Jazzs drug product prior to the expiration of patents owned by Jazz. Since Jazz filed its initial complaint, two other actions have been consolidated with the instant matter. The patents-in-suit, the 431, 889, 219, 506 (the 431 patent family), as well as the 650 patent that Jazz seeks to consolidate in this motion, contain claims related to sodium oxybate, and methods of use and administration of pharmaceutical compounds containing sodium oxybate. In seeking consolidation of its lawsuit alleging infringement of the 650 patent with its earlier lawsuits, Jazz contends the 650 patent contains claims that are substantially similar to the patents in the 431 patent family. In light of this alleged overlap of infringement and invalidity issues, Jazz asserts that consolidation is appropriate. Roxane contends that consolidation is inappropriate because the claims of the patents within the 431 family are different from those of the 650 patent, and consolidation would not streamline pretrial proceedings. While some delay in the 650 patent proceedings may result, the Court finds that there is substantial overlap among the patents that Roxane is alleged to have infringed, and that consolidation is appropriate. [Filed April 12, 2013]
INTELLECTUAL PROPERTY PATENTS
53-7-9823 Teva Neuroscience, Inc. v. Watson Laboratories, Inc.,Dist. Ct. (Cecchi, U.S.D.J.) (20 pp.) This matter comes before the Court by request of for claim construction. The parties sought the Courts interpretation of disputed terms in United States Patent No. 5,453.446 (the 446 Patent). The 446 Patent claims a method of treating a patient with Parkinsons disease by administering to the patient an effective amount of a particular compound. A Markman hearing was held and here the Court sets forth its construction of the disputed terms. [Filed April 12, 2013]