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Seldom does an appeal land on the Supreme Court’s doorstep with such a capacity to combust as Maw v. Advanced Clinical Communications Inc., A-99-02. The case is a volatile mix of policy issues that could blow up in the justices’ faces no matter how carefully it’s handled. Not much is at stake — only the future of noncompete covenants in New Jersey employment contracts. Such clauses have historically protected companies from losing employees with specialized knowledge to competitors, but the Appellate Division ruled that a worker fired for refusing to sign might, in some circumstances, bring suit under the Conscientious Employee Protection Act. Karol Maw met the test. Hired in November 1997 as a graphic designer for Advanced Clinical Communications Inc., she was fired in March 2001 for refusing to sign an agreement that precluded her from working for any ACCI competitor or customer for two years after leaving the company. A Mercer County judge dismissed her CEPA claim but the Appellate Division reinstated it, finding the pact violated public policy. Last Monday, ACCI’s lawyer urged the court not to push CEPA into a new terrain that lawmakers did not anticipate. “The New Jersey Legislature has not made a determination” that restrictive covenants violate public policy, said Debbie Sandler, a partner at White and Williams in Philadelphia. “CEPA must have limits to its reach.” But when Sandler suggested that ACCI had a legitimate interest in having Maw sign a no-compete pact because of the sensitive nature of her work, Chief Justice Deborah Poritz and Justice Virginia Long seemed perplexed. What was it about the job of graphic designer, they asked, that was so sensitive? Sanders answered that Maw dealt with confidential information from clients about trade secrets and new medications that had not been publicly disclosed. The company and its clients had to be able to ensure that if Maw left, she could not disclose that information to competitors. Justice James Zazzali said, “She had a choice, either sign or be fired. Sign and have her future opportunities restricted.” “Only partially restricted,” replied Sandler, noting that Maw could take a job with another company that did not compete with ACCI or its clients. Zazzali seemed unassuaged. “The Court is very concerned about blocking workers’ rights to seek employment elsewhere,” he said. Justice Peter Verniero returned to the public policy implications of using CEPA to police noncompete clauses. “It’s up to the Legislature to make this kind of policy determination?” he asked. “Absolutely,” Sandler said. When it came time for Maw’s attorney to respond, he took issue with Sandler’s plea that allowing the CEPA suit to go forward would, in effect, nullify restrictive covenants. “That is an argument that is overblown and far overstates the case,” said Richard Schall, a partner at Moorestown’s Schall & Barasch. “This does not sound the death knell for no-compete agreements.” Schall insisted that public policy augured more for upholding the Appellate Division’s ruling, since employees don’t really have a choice but to sign a no-compete clause. “Most employees don’t have the resources to test” restrictive covenants in court, Schall said. “The consequence of a reversal is that [most employees] would have absolutely no cause of action.” IF THE SUIT FITS Lawyers on Monday asked the court to determine, in malpractice actions, whether plaintiffs and defendants can rely on expert testimony rather than have to determine the value of the action under the traditional “suit-within-a-suit” format. A lawyer representing a Bellmawr woman injured more than a decade ago asked the court to overturn an Appellate Division ruling that said he improperly used the expert witness tactic when, in fact, he used both formats. Karen Garcia suffered knee and head injuries in a four-car pileup on Route 130 in East Windsor in 1992. Her lawyer, an associate at Cherry Hill’s Kozlov, Seaton, Romanini, Brooks & Greenberg, filed a claim against the driver believed to have caused the accident, but she was missing by the time of trial, which left another associate at the firm (since acquired by Philadelphia’s Wolf, Block, Schorr & Solis-Cohen) in the predicament of trying the case against an “empty chair.” The lawyer, Michael Gentlesk, advised Garcia to accept a cumulative settlement of $87,500 from the other defendants, although he later told her that the case, if the missing driver had been involved, would have been worth $200,000 to $250,000. Garcia then retained Martin Indik, a partner at Princeton’s Indik & McNamara, who filed a malpractice claim against Kozlov, Seaton. At trial, the firm’s expert testified that the $87,500 was adequate. Indik produced an expert who backed up Gentlesk’s statement that the case was worth at least $200,000 to $250,000. At the same time, Indik says, he presented testimony from others involved in the accident, thus following the “suit-within-a-suit” format. The Appellate Division said the trial judge should have followed the suit-within-a-suit format rather than allow the expert testimony. Indik, in Garcia v. Kozlov, Seaton, Romanini, Brooks & Greenberg, A-81-02, told the court that the ruling impermissibly interfered with the trial judge’s ability to make a judgment call on how the trial should proceed. The defendant had expert testimony, Indik said. Thus, he had the right to present expert testimony as well. “Otherwise, the plaintiff has to defend against an empty chair. “This is litigation catastrophe,” said Indik. “This boils down to a trial judge’s” ability to make a judgment as to what evidence is permissible. The firm’s lawyer, Wolf, Block partner Gilbert Brooks, asked the court to uphold the Appellate Division. “It’s better to go ahead as a case-within-a-case,” Brooks said. “The Appellate Division said there was no sound basis for the alternative.” “What about deferring to the trial judge,” asked Long. “You can do that, depending on the complexity of the case,” said Brooks. “Here, there was no sound basis for deviating from the suit-within-a-suit format.” FAMILY TIES An effort by drug-addicted parents to prevent adoption of their children is testing whether the Kinship Legal Guardian Act of 2001 might be invoked in a way that is not in a child’s best interests. Division of Youth and Family Services v. P.P. and S.P., A-32-03. In this case, the grandparents of the children had been caring for them for years and now want to adopt, but the parents wish to preserve their parental rights and to keep the grandparents in “kinship legal guardianship” status. Such a guardian is a court-appointed family friend or relative of a child who is willing to assume care due to parental incapacity, with the intent to raise the child to adulthood. The Appellate Division ruled in the parents’ favor and DYFS appealed. Deputy Attorney General Jessica Greenstein argued that although the parents were showing “tremendous progress” in fighting their addictions, having the children remain in long-term care with the grandparents might ultimately not be best for them. Greenstein stressed that while “DYFS’ first priority is reunification, if possible,” adoption must be pursued if reunification is deemed unsafe. “For DYFS, kinship legal guardianship is not an alternative,” she said. The children’s appointed counsel agreed. “The health and safety of the children has to be of paramount concern,” said Assistant Deputy Public Defender Edward Marable Jr. “Kinship legal guardianship is not meant to be used as a weapon. This defense tactic gives no benefit to the children.” When S.P.’s lawyer, Newark solo practitioner Alan Smith, said the Appellate Division correctly allowed the parents to retain their rights, Justice Barry Albin asked whether the ruling “would discourage grandparents from opening their homes.” Smith said that is a concern, but said DYFS has not made a “good faith effort” to determine whether kinship legal guardianship will work. “Terminating parental rights is not in the best interests of a child,” he said. “But sometimes it is, unfortunately,” replied Poritz.

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